Justia ERISA Opinion Summaries

The district court overturned an employee benefit plan's denial of a former employee's claim for permanent and total disability life insurance benefits. On appeal, Defendant Owens-Illinois Hourly Employees Welfare Benefit Plan contended the district court erred in rejecting Defendant’s argument that the employee was not eligible for this benefit under the Plan’s life insurance coverage provisions because his PTD life insurance claim was not filed until after he retired. Upon review, the Tenth Circuit concluded that the district court should have entered judgment in favor of Plaintiff on the administrative record rather than remanding for further administrative proceedings. The Tenth Circuit therefore remanded the case with directions for the district court to modify its order and enter judgment in favor of Plaintiff. View "Spradley v. Owens-Illinois Hourly Employees Welfare Benefit Plan" on Justia Law

LINA appealed the district court's ruling that LINA abused its discretion in denying death benefits to Dawn McClelland based upon her husband's life insurance policy. LINA also appealed the district court's award of attorney's fees. The court found that LINA committed an abuse of discretion in denying benefits because its interpretation was contrary to the language of the plan that it would cover "loss of life" based upon an "accident" and because substantial evidence did not support its decision. The court also found that the total fee awarded should be $85,000 and remanded to the district court to enter an award in that amount. The prejudgment interest award was affirmed. View "McClelland v. Life Ins. Co. of North America" on Justia Law

Plaintiffs, employees at a defense plant in Arizona, collectively bargained for the right to receive employer-provided healthcare coverage after they retired. At issue was whether those employees, now retirees, were contractually entitled to receive premium-free healthcare coverage until age 65, or whether the contracts on which the retirees relied as providing that entitlement allowed their prior employer to start charging them for their insurance. The court held that Raytheon expressly agreed to provide 100% company-paid healthcare coverage for eligible retirees; that Raytheon's obligation survived the expectation of the collective bargaining agreements (CBAs); and that Raytheon's agreed-upon obligation could not be unilaterally abrogated by Raytheon, regardless of the rights Raytheon reserved for itself in Plan documents, because the CBAs did not incorporate the Plans' reservation-of-rights provisions with respect to employer contribution issues, as opposed to issues relating to the provision of monetary or in kind benefits for particular medical services. The court further held that the district court did not err in rejecting plaintiffs' claim for punitive and extra-contractual damages. View "Alday, et al. v. Raytheon Co.; Agraves, et al. v. Raytheon Co." on Justia Law

While working as a dentist, Fleisher obtained long-term disability insurance coverage under separate policies. He obtained the North American policy by membership in a professional organization. The Standard policy is an employee benefit, governed by the Employee Retirement Income Security Act, 29 U.S.C. 1132(a)(1)(B) and provides for monthly benefits to a maximum of "$10,000 before reduction by Deductible Income," defined to include "[a]ny amount you receive or are eligible to receive because of your disability under another group insurance coverage," but to exclude benefits paid under "any individual disability insurance policy." In 2008, Fleisher became disabled and claimed benefits under both policies. Shortly after Fleisher began collecting under both policies, Standard reduced his monthly benefits from $10,000 to $8,500 based on its determination that the North American policy was another group insurance coverage, and that the $1,500 in benefits he receives under it is deductible income. The district court dismissed his ERISA suit. The Third Circuit affirmed, finding the decision supported by substantial evidence and not unreasonable. View "Fleisher v. Std. Ins. Co." on Justia Law

After plaintiff was denied long-term disability benefits by Standard, he sought review of Standard's determination under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. The court affirmed the district court's grant of summary judgment in favor of Standard and held that there was substantial evidence supporting Standard's denial of benefits. The court also held that a conflict of interest alone was not determinative where there existed substantial evidence on the record supporting the denial of benefits. View "Hankins v. Standard Ins. Co." on Justia Law

A class of retirees who had worked under a collective bargaining agreement and their survivors and dependents obtained monetary damages and declaratory and injunctive relief requiring that defendants provide vested lifetime healthcare benefits to the class members depending on the relevant date of retirement (Employee Retirement Income Security Act of 1974, 29 U.S.C. 1132(a)(1)(B); Labor-Management Relations Act, 29 U.S.C. 185). The Sixth Circuit affirmed, holding that defendant Newell Window is bound as a successor liable under earlier collective bargaining agreements to which it was not a party; that members of the plaintiff class had vested rights to company-paid health insurance and/or Medicare Part B premium reimbursements; and that the claims were not barred by the applicable six-year statute of limitations. View "Bender v. Newell Window Furnishings, Inc." on Justia Law

Participants in an employer-sponsored 401(k) plan brought suit under the Employment Retirement Income Security Act of 1974, 29 U.S.C. 1001, and the Investment Company Act of 1940, 15 U.S.C. 80a-1, claiming excessive fees on annuity insurance contracts offered to plan participants. The district court dismissed the ICA claims because only those maintaining an ownership interest in the funds could sue under the derivative suit provision and the participants are no longer investors in the funds in question. As to the ERISA claims, the court dismissed because participants failed to make a pre-suit demand upon the plan trustees to take appropriate action and failed to join the trustees as parties. The Third Circuit affirmed with regards to the ICA claims, but vacated on the ERISA counts, holding that the statute does not require pre-suit demand or joinder of trustees. View "Santomenno v. John Hancock Life Ins. Co." on Justia Law

In 2005, the Secretary of Labor filed suit for breach of fiduciary duty, alleging that defendants had established a health benefit plan that was a multi-employer welfare arrangement governed by the Employee Retirement Income Security Act. Defendants had retained, as compensation, a substantial portion of payments made by businesses to enroll their employees. The complaint alleged improper diversion of funds and that defendants were required by ERISA to use the assets only for the defraying reasonable plan expenses for the benefit of plan participants. The district court ruled in favor of defendants. The Third Circuit vacated, characterizing the scheme appearing to be "an aggressively marketed, but inadequately funded health benefit plan masquerading as an ERISA-exempt plan in order to evade the solvency controls imposed by state insurance regulation."View "Sec'y of Labor v. Doyle" on Justia Law

Plaintiffs brought a putative class action under the Employee Retirement Income Security Act, 29 U.S.C. 1001, to recover benefits under long-term disability benefit plans maintained by their former employers. The plans provide for reduction of benefits if the disabled employee also receives benefits under the Social Security Act, as both plaintiffs do. They dispute calculation of the reduction, claiming that the plans do not authorize inclusion in the offset of benefits paid to dependent children. Both plans require offsets for "loss of time disability" benefits. The district court dismissed. The Seventh Circuit affirmed, holding that children's Social Security disability benefits paid based on a parent's disability are "loss of time disability" benefits under the language of the plans. View "Schultz v. Aviall Inc. Long Term Disability Plan" on Justia Law

Plaintiff commenced this action under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., claiming that the administrator of the Principal Life policies had misconstrued the policies in calculating his predisability earnings and that, with a proper calculation, his predisability earnings were far greater. The district court, ruling on cross-motions for summary judgment, entered judgment in favor of Principal Life. The court affirmed. Even though the court recognized that the policy language, defining those expenses that could be subtracted from gross income to arrive at predisability earnings, was somewhat confusing and, to be sure, needlessly verbose, the court concluded that the administrator's interpretation was a reasonable one. View "Fortier v. Principal Life Ins. Co." on Justia Law