Justia ERISA Opinion Summaries

Richard worked for GPI for 25 years until his 2009 death. He had a basic life insurance policy through GPI’s health and welfare plan and paid for an optional supplemental life insurance policy through GPI for several years. His wife, Maureen, was the beneficiary of both policies. At the end of 2008, Richard’s supplemental life insurance policy was cancelled. Richard’s pay stubs reflected the change, beginning in January 2009. When Richard died a few months later, GPI’s insurer, ABC, paid benefits on the basic life insurance policy. Richard had been diagnosed with stage 4 cancer in September 2008. Soon after Richard’s death, Maureen’s attorney requested information regarding Richard’s supplemental life insurance policy. The company refused the request, citing its confidentiality policy, indicating that the information would only be produced in response to a subpoena. Almost two years later, Maureen filed suit, claiming that either GPI or ABC breached the policy by terminating it without Richard’s consent, in violation of the Employee Retirement Income Security Act, 29 U.S.C. 1001. The district court awarded the defendants summary judgment. The Seventh Circuit affirmed. There was no material issue of fact as to whether Richard cancelled his supplemental policy. Although Maureen speculated that someone other than Richard terminated the policy, she presented no evidence to support her assertion. View "Herzog v. Graphic Packaging Int'l, Inc." on Justia Law

An employee benefits plan sued a medical college that provides patient care in clinics and hospitals and an affiliated children’s hospital, with which it had provider agreements, alleging ERISA violations and breach of contract under Wisconsin law. The suit was based on the plan’s determination that an employee’s child was not covered by the plan and the hospital’s denial of its subsequent request that the hospital refund about $1.7 million the plan had already paid on behalf of the child. The plan makes no mention of refunds. The district court dismissed and awarded attorneys’ fees to the hospital as a sanction for having filed frivolous claims. The Seventh Circuit affirmed dismissal of the ERISA claims but reversed dismissal of the breach of contract claim, rejecting the district court’s finding of preemption, and imposition of sanctions. On remand of the contract claim, the district court granted summary judgment in favor of the hospital. The Seventh Circuit affirmed, noting that the hospital, having been paid in full by the plan, has no possible claim against Medicaid, that the plan took 11 months to determine that the child was not a beneficiary, and that the hospital has not been unjustly enriched. View "Kolbe & Kolbe Health & Welfare Benefit Plan v. Med. Coll. of WI" on Justia Law

A Vermont statute requires all "health insurers" to file with the State reports containing claims data and other "information relating to health care." Liberty Mutual sought a declaration that the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., preempted the Vermont statute and regulation. The district court granted summary judgment in favor of Vermont. The court held that the reporting requirements of the Vermont statute and regulation have a "connection with" ERISA plans and were therefore preempted as applied. The court's holding was supported by the principle that "reporting" is a core ERISA function shielded from potentially inconsistent and burdensome state regulation. Accordingly, the court reversed and remanded with instructions to enter judgment for Liberty Mutual. View "Liberty Mutual Ins. Co. v. Donegan" on Justia Law

Javery began working for Lucent as a software engineer in 1998 and participated in Lucent’s Employee Retirement Income Security Act, 29 U.S.C. 1001, qualified disability plan, administered by CIGNA. In November 2002, he reported back pain. His family doctor, Dr. Dorado, prescribed medicine and testing, and recommended some time off work. In January 2003, after Lucent transferred him from Ohio to Illinois, Javery sought treatment from another physician, Seymour. The pain worsened. In May 2005, Javery stopped working on Dr. Seymour’s advice. Lucent approved and paid short term disability benefits from until those benefits expired in November 2005. Lucent notified CIGNA that it believed Javery might be eligible for long term benefits. Javery applied, submitting extensive medical evidence of his pain and resulting cognitive impairment and of his successful application for Social Security disability benefits, but the claim was denied. In addition to claiming that Javery had not shown that he was “disabled” as that term is defined in the Plan, CIGNA claimed that Javery should be judicially estopped from pursuing his ERISA claim because Javery failed to disclose the claim in his Chapter 13 personal bankruptcy action. The district court upheld the denial. The Sixth Circuit reversed. View "Javery v. Lucent Tech., Inc. Long-Term Disability Plan" on Justia Law

As an assembler with Eaton Corporation, McClain purchased the highest level of long-term disability insurance, which was “designed to replace ... 70 percent of [her] monthly base pay.” She stopped working in January 2008, due to a back injury she suffered on the job in June 2007. She received benefits during the first 24 months under the First Tier of the Plan’s coverage, which defined disability as being “totally and continuously unable to perform the essential duties of your regular position with the Company, or the duties of any suitable alternative position with the Company.” After 24 months, the Plan to an “any occupation” standard, providing Second Tier coverage if “you are totally and continuously unable to engage in any occupation or perform any work for compensation or profit for which you are, or may become, reasonably well fit by reason of education, training or experience--at Eaton or elsewhere.” The Plan denied her claim for benefits because her treating physician opined McClain could work part-time, and a market study identified various part-time positions in the area for which she was qualified. The district court rejected her suit under the Employee Retirement Income Security Act, 29 U.S.C. 1001. The Seventh Circuit affirmed, finding that the determination was not arbitrary.View "McClain v. Eaton Corp. Disability Plan" on Justia Law

Appellee, as executrix of the estate of her father, and her sister, brought a breach of contract action in which they asserted that their father's second wife, appellant, contractually waived her right to retain the proceeds of their deceased father's employer-provided 401K plan and life insurance policy by entering a settlement agreement incorporated into an order of separate maintenance executed approximately a year prior to the father's death. At issue was whether the court of appeals erred in finding that decedent's children could maintain a state law action against the decedent's surviving spouse to recover proceeds distributed to the spouse as the beneficiary of the decedent's ERISA-governed benefits plans, 29 U.S.C. 1001 et seq., where the state law claims were based on a contention that the spouse waived her rights to such proceeds. The court answered in the negative, concluding that, in this case, since the proceeds of the ERISA-covered plans were paid out to appellant and were no longer in the control of the plan administrator, the trial court erred when it dismissed appellees' breach of contract claim against appellant.View "Appleton v. Alcorn, et al." on Justia Law

The parties to the appeal disagreed about whether an employer who self funded a health-benefit plan for its employees was an "insurer" under the Texas Insurance Code, and therefore should be treated as a reinsurer when purchasing stop-loss insurance. The court of appeals concluded that an employer's self-funded plan was clearly an insurer under the Code and that a plan's purchase of stop-loss insurance was also clearly reinsurance beyond the regulatory scope of the Texas Department of Insurance. The court accordingly reversed the trial court's judgment, which held that the agency's regulation of the stop-loss policies at issue as direct insurance. Because the regulatory agency did not clearly err in its regulation of these stop-loss policies, however, the court reversed the court of appeals' judgment and rendered judgment for the agency.View "TX Dept. of Ins., et al. v. American National Ins. Co., et al." on Justia Law

Respondent, an insurer/managed care organization, contracted with an endoscopy center and gastroenterology center (collectively, the Clinic) to provide health care services to its insureds. After the Nevada Health District found that the Clinic engaged in a number of unsafe medical practices, Respondent terminated its contract with the Clinic. Janice Munda was insured by Respondent through her employer's health plan, which was governed by ERISA. Munda was diagnosed with hepatitis C, which the Health District determined she contracted as a result of being treated at the Clinic. Janise and her husband (collectively, Appellants) sued Respondent for negligence, negligence per se, breach of implied covenant of good faith and fair dealing, and loss of consortium. The district court granted Respondent's motion to dismiss, finding that Appellants' claims were preempted by ERISA. The Supreme Court reversed, holding that under the facts, there was no preemption because Respondent's alleged actions were independent of the administration of the ERISA plan. View "Munda v. Summerlin Life & Health Ins. Co." on Justia Law

Appellant Margerita Cervantes allegedly contracted hepatitis C as a result of treatment she received at the Endoscopy Center of Southern Nevada (ECSN). Appellant obtained treatment at ECSN as part of the health care benefits she received through her culinary union. The union operated a self-funded ERISA health care plan and retained Respondents, Health Plan of Nevada and other health and life insurance entities, as its agents to assist in establishing a network of the plan's chosen medical provider. Appellant filed a lawsuit alleging that Respondents were responsible for her injuries because they failed to ensure the quality of care provided by ECSN and referred her to a blatantly unsafe medical provider. The district court concluded that Cervantes' claims were preempted by ERISA section 514(a). The Supreme Court affirmed, holding that state law claims of negligence and negligence per se against a managed care organization contracted by an ERISA plan to facilitate the development of the ERISA plan's network of health care providers were precluded by ERISA section 514. View "Cervantes v. Health Plan of Nevada" on Justia Law

Hartford is the administrator of Wal-Mart’s Group Disability Plan, which is covered by the Employee Retirement Income Security Act. The policy requires any suit to recover benefits pursuant to ERISA, 29 U. S. C. 1132(a)(1)(B), to be filed within three years after “proof of loss” is due. Heimeshoff filed a claim for long-term disability benefits. Following mandatory administrative review process, Hartford issued a final denial. Almost three years after the final denial but more than three years after proof of loss was due, Heimeshoff sought judicial review under ERISA. The district court dismissed, reasoning that while ERISA does not provide a statute of limitations, the contractual limitations period was enforceable under state law and Circuit precedent. The Second Circuit affirmed. The Supreme Court affirmed, finding the limitations provision enforceable. A participant’s ERISA cause of action does not accrue until the plan issues a final denial, but it does not follow that a plan and its participants cannot agree to commence the limitations period before that time. The Court noted that contractual limitations provisions should ordinarily be enforced as written. The period at issue is not unreasonably short and does not undermine ERISA’s two-tiered remedial scheme by causing participants to shortchange the internal review process. If administrators attempt to prevent judicial review by delaying the resolution of claims in bad faith, the penalty for failure to meet regulatory deadlines is immediate access to judicial review for the participant and courts can apply waiver or estoppel. Plans offering appeals beyond what is contemplated in the internal review regulations must agree to toll the limitations provision during that time, 29 CFR 2560.503–1(c)(3)(ii). View "Heimeshoff v. Hartford Life & Accident Ins. Co." on Justia Law