Justia ERISA Opinion Summaries

Miller, a Fund beneficiary, fell from a ladder and was injured. He hired attorney Darr on a contingent fee basis to sue the person who was supposed to hold the ladder. The Fund advanced $86,709.73 in medical and disability benefits on the condition that Miller repay from any recovery, without deducting attorneys’ fees. Miller and Darr, signed a subrogation agreement. The lawsuit settled for $500,000. Calculating his fee based on $413,290.27, Darr submitted $57,806.48 to the Fund, stating that he was withholding $28,903.25 as a fee. To avoid jeopardizing Miller’s benefits Darr later submitted the $28,903.25. The Fund indicated that if Darr pursued his claim, it would consider Darr and Miller in breach of Plan terms and in repudiation of the subrogation agreement and would consider terminating coverage and seeking relief under ERISA. Darr sued the Fund in Illinois state court under the common fund doctrine, which permits a party who creates a fund in which others have an interest to obtain reimbursement for litigation expenses incurred in creating that fund. The district court enjoined Darr’s lawsuit. The Seventh Circuit vacated. A federal court may not enjoin “proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments,” 28 U.S.C. 2283.View "Trs. of the Carptenters' Health & Welfare Trust v. Darr" on Justia Law

Four plaintiffs each established an employee benefit plan under the Employee Retirement Income Security Act funded by a combination of employer contributions and covered employee payroll deductions; each entered into a Benefit Management Service Agreement with PBA, which specified that PBA would provide services, such as paying medical providers for claims incurred under the Plans. Each Agreement required PBA to establish a segregated bank account for each Plan into which it would deposit the funds that it received from the corresponding plaintiff for paying the medical claims and authorized PBA to pay medical claims by writing checks from this account. PBA not only failed to use funds supplied by plaintiffs to pay the claims incurred under the corresponding Plan, but commingled and misappropriated Plan funds. PBA did not pay all claims, despite receiving money for payment of those claims from the respective plaintiffs. The amounts unpaid for the plaintiffs are: $501,380.75, $409,943.88, $384,574.17, and $44,290.12. The district court found that PBA was a fiduciary under ERISA (29 U.S.C. 1002(21)(A)), had breached its fiduciary duties, and that ERISA preempted Permco’s breach-of-contract claims. The Sixth Circuit affirmed. View "Guyan Int'l, Inc. v. Prof'l Benefits Adm'rs, Inc." on Justia Law

Jeranek, a beneficiary of the Humana Plan, was hospitalized in 2006. Three days later, she was admitted at Nu-Roc Nursing Home. She was 88 years old and suffered from a variety of maladies that required her to use 14 prescription medications. A physician estimated at the time of her admission that Jeranek had a life expectancy of about one year. Jeranek was a resident at Nu-Roc for 702 days. On several occasions she declined medical treatment and her physician understood that she was to receive comfort care only. From November 15 until November 19, 2006, Jeranek’s stay at Nu-Roc was paid for by Medicare. Humana paid $50,097.67 to Nu-Roc for services provided from November 20, 2006, to September 30, 2007, but later determined that its disbursement had been a mistake, reasoning that “custodial” care was not covered by the Plan. Humana sought reimbursement for its previous payments and denied coverage for October 1, 2007 through October 22, 2008, when costs for Jeranek’s care totaled $64,669.74. The district court determined that Humana’s denial of coverage was not arbitrary and granted summary judgment for the Plan. The Seventh Circuit affirmed. View "Becker v. Chrysler LLC Health Care Benefits Plan" on Justia Law

Aschermann suffers from degenerating discs and spondylolisthesis and had lumbar fusion operations in 2002 and 2004. Until 2003 she worked as a sales representative. Back pain left her unable to perform its duties. Between 2003 and 2009 she received disability payments under the employer’s disability plan, a welfare-benefit plan governed by the Employee Retirement Income Security Act. The policy provides that after the first two years of benefits, the question becomes whether the recipient can perform any job in the economy as a whole. Lumbermens stopped paying disability benefits to Aschermann in fall 2009, concluding that she could do sedentary work. The district court held that the decision to end her disability benefits was not arbitrary. The Seventh Circuit affirmed. Aschermann does not deny that her education B.S. in psychology and master’s degree in social work and experience suit her for many desk-bound positions, but claimed inability to work more than four hours a day. The insurer gave notice complying with ERISA, (29 U.S.C. §1133(1), that it wanted new diagnostic test results and other recent information; she was given a “reasonable opportunity” to supplement the file and receive a “full and fair review.” View "Aschermann v. Aetna Life Ins. Co." on Justia Law

Aetna Life Insurance Company, as the plan administrator, determined Sharon Wade was no longer disabled and stopped paying long-term disability benefits from Wade's former employer's welfare benefit plan. Wade sought judicial review of Aetna's decision by filing a civil action under ERISA. The district court granted summary judgment in favor of Aetna, concluding that Aetna did not abuse its discretion in terminating Wade's benefits because substantial evidence supported the decision. The Eighth Circuit Court of Appeals affirmed, holding that the district court (1) applied the appropriate standard of review; (2) gave appropriate weight to the Social Security Administration's grant of long-term disability benefits to Wade; and (3) did not abuse its discretion by determining substantial evidence supported Aetna's termination of benefits. View "Wade v. Aetna Life Ins. Co." on Justia Law

Marantz practiced pulmonary and critical care medicine. In 1997 she underwent surgery for a herniated disc and degenerative disc disease. The surgery did not eliminate her pain. In 1999, she stopped working full time. Through her employment with she received disability coverage from LINA. LINA approved her claim. Additional surgery did not resolve the problem. MRIs revealed degenerative disc disease and spinal stenosis. In 2000 LINA provided funding for Marantz to enroll in an online Masters of Public Health program, for retraining for less-demanding work. In 2001, Marantz began working approximately 20 hours per week for the Illinois Department of Public Health. LINA offset disability benefits and reduced its monthly payment from $7,616 to $5,000 per month. LINA paid benefits for 60 months. In 2004, LINA investigated whether Marantz satisfied the policy’s more stringent definition of disability relevant after the first 60 months: “unable to perform all the material duties of any occupation for which [that worker] may reasonably become qualified based on education, training or experience.” In 2005 LINA terminated benefits, based on a functional capacity evaluation, doctors’ assessments, and surveillance. Marantz sued under the ERISA, 29 U.S.C. 113. The district court entered judgment in the defendants’ favor. The Seventh Circuit affirmed. View "Marantz v. Permanente Med. Grp., Inc." on Justia Law

Plaintiff appealed the district court's dismissal of her claim challenging the termination of her long-term disability benefits under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1132. Plaintiff challenged the district court's grant of summary judgment in favor of Unum on it's counterclaim for restitution of overpaid benefits. The court held that the district court abused its discretion by dismissing the claim for denial of benefits for failure to exhaust administrative remedies. The exhaustion requirement should have been excused because plaintiff acted reasonably in light of Unum's ambiguous communications and failure to engage in a meaningful dialogue. Accordingly, the court vacated the judgment in favor of Unum on plaintiff's claim for denial of benefits. View "Bilyeu v. Morgan Stanley Long Term Disability Plan, et al." on Justia Law

Defendant appealed the district court's grant of partial summary judgment in favor of CGI in its action seeking "appropriate equitable relief" under section 502(a)(3) of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. CGI appealed the district court's grant of partial summary judgment in favor of defendant's counsel and codefendant, dismissing the codefendant from the action. CGI also appealed the district court's grant of proportional fees and costs to the codefendant, deducted from CGI's recovery from defendant. The court affirmed the district court's grant of summary judgment in favor of the codefendant, dismissing it from the action. However, because the court saw no indication that in fashioning "appropriate equitable relief" for CGI, the district court did more than interpret the plain terms of the reimbursement provision, and no indication that the district court considered traditional equitable principles in assigning responsibility to CGI for attorneys' fees and costs, the court vacated the judgment in favor of CGI, vacated the judgment that the codefendant deducted fees and costs from CGI's entitlement, and remanded to the district court for further proceedings. View "CGI Technologies and Solutions v. Rose, et al." on Justia Law

LINA appealed the decision of the district court holding that it abused its discretion in its denial of benefits to plaintiff under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. Plaintiff alleged that LINA wrongly denied her the benefits of her common-law husband's ERISA-governed Group Accident Policies where her husband participated in two accidental death and dismemberment policies. The court affirmed the district court's holding that the common law definition of "accident" adopted in Todd v. AIG Life Insurance Co., was controlling in all ERISA accidental death and dismemberment plans where the term "accident" was undefined, irrespective of whether the plan administrator was given discretion to interpret the plan. View " Firman v. Beacon Construction Co., Inc." on Justia Law

Plaintiff appealed the district court's summary judgment dismissing her suit to recover health insurance benefits under an employee plan governed by the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001-1461. Aetna, a Texas health maintenance organization (HMO), provided and administered the plan's health insurance benefits under an agreement giving Aetna discretion to interpret the plan's terms. Aetna refused to reimburse plaintiff for care she received from a specialist outside of the Aetna HMO to whom she had been referred by a physician in the HMO. Aetna denied her claim because the referral was not pre-authorized by Aetna. The district court found as a matter of law that Aetna did not abuse its discretion in denying coverage. The court found, however, that the plan was ambiguous and the need for pre-authorization was not clearly stated in Aetna's summary description of the plan. And under the circumstances of the case, it could not be said as a matter of law that Aetna did not abuse its discretion in denying coverage. View "Koehler v. Aetna Health, Inc." on Justia Law