Justia ERISA Opinion Summaries

Plaintiffs, former employees of NOPSI, filed claims against RTA and others under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., and later 42 U.S.C. 1983 and various state laws. The district court granted summary judgment on the federal claims and declined to exercise supplemental jurisdiction on the state law claims. The court held that the plan at issue was a governmental plan and thus exempt from ERISA. Accordingly, the district court did not err in granting summary judgment as to the successor liability claims against the RTA. The court expressed no opinion as to whether successor liability applies to ERISA violations by predecessor entities. The court also concluded that plaintiffs' section 1983 claims are barred by the statute of limitations. Finally, plaintiffs failed to demonstrate that the district court abused its discretion in denying their FRCP 56(d) motion. Accordingly, the court affirmed the judgment. View "Smith v. Regional Transit Auth." on Justia Law

Harrogate, a healthcare provider, participates in Blue Cross networks. Harrogate’s patients sign an “Assignment of Benefits,” allowing Harrogate to bill Blue Cross directly for services. The Provider Agreement allows Blue Cross to perform post-payment audits and recoup overpayments from Harrogate. Blue Cross paid Harrogate's claims for antigen leukocyte cellular antibody (ALCAT) tests, which purport to identify certain food allergies. Blue Cross claims that these tests have “little or no scientific rationale.” Investigational treatments are not “covered, compensable services” under Blue Cross’s Manual, which is incorporated by reference into the Provider Agreement. That Agreement also specifies that Harrogate may not “back-bill” patients for un-reimbursed, investigational treatments unless, before rendering such services, “the Provider has entered into a procedure-specific written agreement with the Member, which has advised the Member of his/her payment responsibilities.” Blue Cross began recouping ALCAT payments. Harrogate filed suit under the Employee Retirement Income Security Act. The district court dismissed, holding that Harrogate did not meet the statutory definition of “beneficiary” and had not received a valid assignment for the purpose of conferring derivative standing to bring suit under ERISA. The Seventh Circuit affirmed. While Harrogate had derivative standing through an assignment of benefits, its claim regarding recoupments falls outside the scope of that assignment. View "Brown v. BlueCross BlueShield of Tenn., Inc." on Justia Law

HMC was a shipping and shipyard services company, whose president was Hannah. HMC had a collective bargaining agreement with the mechanics union that required it to make contributions to the union’s pension fund to finance pensions for HMC’s employees. Hannah’s son, Mark, formed FCG, which bought the assets of HMC. No significant liabilities of HMC were explicitly transferred to FCG, which tried to negotiate its own collective bargaining agreement with the union. When HMC employees voted to decertify the union in 2009. the pension fund assessed withdrawal liability under the Multiemployer Pension Plan Amendments Act, 29 U.S.C. 1381. HMC had become insolvent, so the fund sought to impose HMC’s liability to the fund on FCG as HMC’s successor. The district court entered summary judgment in favor of FCG. The Seventh Circuit reversed in part, stating that lack of evidence that Mark knew about the pension fund and the possibility of withdrawal liability cannot excuse that liability. The court stated that fraudulent intent, while a factor in deciding whether there is alter ego liability, is not necessarily an essential factor, so summary judgment on a theory of successor liability was premature. View "Bd. of Trs. of the Auto. Mechs' Local v. Full Circle Group, Inc." on Justia Law

Plaintiff filed claims alleging breach of contract and claims under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., against BAH and others. Under California law, a breach of a written contract must be brought within four years of the date of the alleged breach, Cal. Civ. Proc. Code 337. The court concluded that plaintiff's cause of action accrued in September 2003 and the filing of his complaint was untimely. Therefore, plaintiff's breach of contract claim is time barred. The court also concluded that the district court did not abuse its discretion by denying plaintiff a third opportunity to amend his complaint. Finally, the court held that the employer’s stock rights plan did not qualify as an employee pension benefit plan subject to ERISA under 29 U.S.C. 1002(2)(A) because its primary purpose was not to provide deferred compensation or other retirement benefits. Because, in this case, the stock rights plan was not designed or intended to provide retirement or deferred income, it is not covered by ERISA. Accordingly, the court affirmed the judgment. View "Rich v. Shrader" on Justia Law

In 2011, Hogan sued the Life Insurance Company of North America for violating the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001, by denying her benefits claim under a disability insurance policy. The Sixth Circuit affirmed the grant of judgment against her. While appeal was pending, Hogan filed a state court suit against two nurses who worked for the Life Insurance Company and who had provided opinions regarding Hogan’s eligibility for benefits after reviewing her claim. Hogan carefully pleaded her claims in the second suit to avoid reference to the Life Insurance Company or ERISA, alleging only that the nurses committed negligence per se by giving medical advice without being licensed under Kentucky’s medical-licensure laws. The defendants removed the case to federal court on the basis of ERISA’s complete-preemptive effect. The district court denied Hogan’s attempts to remand the case to state court and later granted the defendants’ motion to dismiss. The Sixth Circuit affirmed the denial of remand and the dismissal. Hogan’s artfully pleaded state-law claims are simply claims for the wrongful denial of benefits under an ERISA plan that arise solely from the relationship created by that plan. The court denied defendants’ motion for sanctions on appeal because Hogan’s arguments were not frivolous. View "Hogan v. Jacobson" on Justia Law

Plaintiffs, former employees of Golden Eagle, filed a class action against Liberty Mutual for violating the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. Plaintiffs alleged that when Liberty Mutual purchased Golden Eagle, Liberty Mutual told plaintiffs that they would receive past service credit for the time they worked with Golden Eagle under Liberty Mutual’s retirement plan. The district court granted summary judgment to Liberty Mutual. The court concluded that plaintiffs cannot receive benefits for past service credit with Golden Eagle under the terms of the retirement plan where the district court applied the correct abuse of discretion standard, and Liberty Mutual's interpretation of the plan was reasonable. The court also concluded that plaintiffs are not barred from bringing simultaneous claims under section 1132(a)(3) and 1132(a)(1)(B). In Varity Corp. v. Howe, equitable relief under section 1132(a)(3) is not available if section 1132(a)(1)(B) provides an adequate remedy. In CIGNA Corp. v. Amara, section 1132(a)(3) authorized equitable relief in the form of plan reformation, even though plaintiffs also claimed relief under section 1132(a)(1)(B). Applying Amara’s conclusion that a plaintiff may seek relief under both section 1132(a)(1)(B) and section 1132(a)(3) does not contravene the ruling in Varity. The court further concluded that Liberty Mutual failed to notify plaintiffs in its summary plan descriptions that past service credit with Golden Eagle would not count for benefits accrual, but plaintiffs did not prove harm or reliance on the summary plan descriptions. Finally, the class certification was appropriate. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Moyle v. Liberty Mut. Ret. Benefit Plan" on Justia Law

Plaintiffs, two individual psychiatrists and three professional associations of psychiatrists, filed suit against defendants, four health‐insurance companies, alleging that the health insurers’ reimbursement practices discriminate against patients with mental health and substance use disorders in violation of the Mental Health Parity and Addition Equity Act of 2008 (MHPAEA), 29 U.S.C. 1185(a), and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001-1461. The court concluded that, because the psychiatrists are not among those expressly authorized to sue, they lack a cause of action under ERISA. The court also concluded that the association plaintiffs lack constitutional standing to pursue their respective ERISA and MHPAEA claims because their members lack standing. Accordingly, the court affirmed the judgment. View "Am. Psychiatric Ass’n v. Anthem Health Plans, Inc." on Justia Law

The Secretary filed suit alleging that defendants breached their fiduciary duties under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., when acting as trustees for an Employee Stock Ownership Plan (ESOP). In a three year period, BAI's owner Herbert C. Bruister sold 100% of his BAI shares to BAI's employees through a series of transactions. Two plan participants, Rader and Sealy, filed suit raising generally the same claims as the Secretary and seeking relief on behalf of the ESOP as a whole. The court concluded that Sealy has standing to sue on behalf of the ESOP; the district court applied the law correctly and did not clearly err in finding that Bruister was a fiduciary of the ESOP; defendants breached the duties of loyalty and prudence in their conduct with respect to the stock sales and engaged in prohibited transactions; the district court did not abuse its discretion by denying rescission of the BAI stock sales but granting equitable restitution in the amount the ESOP overpaid; the district court did not clearly err in holding BFLLC jointly and severally liable with the other defendants; the district court’s award and calculation of prejudgment interest were not an abuse of discretion; under the totality of circumstances, the district court did not abuse its discretion in barring defendants from serving as ERISA fiduciaries in the future; and, to alleviate any misconception and avert double recovery, the court modified the concurrent judgments in each consolidated case into a single judgment that disposes of them together. Accordingly, the court affirmed the judgment, but modified its concurrent judgments. View "Perez v. Bruister" on Justia Law

Central States is multiemployer pension fund. Bulk Transport is a Fund member and made contributions to the pension account of its employee, Loniewski. Bulk had certified that Loniewski was entitled by a collective bargaining agreement to participate in the Fund although the agreement was limited to Bulk’s drivers. Loniewski was a Bulk mechanic for 40 years. Bulk now denies that he was covered and has demanded that Central States refund $49,000 that Bulk had contributed to Loniewski’s pension account between 2002 and 2012. The Fund denied the request and sought a declaratory judgment. The district judge rejected Bulk’s claim. The Multiemployer Pension Plan Amendments Act of 1980 amends ERISA by imposing liabilty on employers who withdraw, partially or completely, from participation in an underfunded multiemployer pension fund, 29 U.S.C. 1381. Central States also assessed Bulk with withdrawal liability of $740,000 for the years 2010 through 2012, which Bulk challenged as excessive. At Bulk’s request, the court barred the Fund from enforcing its rules, which require arbitration of such a dispute by and conforming to the procedures of the American Arbitration Association. The Seventh Circuit affirmed with respect to the refund, but reversed with respect to the arbitration rules. View "Cent. States, SE & SW Areas Pension Funds v. Bulk Transp. Corp." on Justia Law

Bruce Barton filed suit against ADT under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1132, seeking claims related to his request for pension benefits. On appeal, Barton challenges the district court's conclusion that the Plan Administrator did not abuse its discretion in denying Barton’s request for pension benefits. The court concluded that the district court incorrectly placed the burden of proof on Barton for matters within defendants’ control. The court held that where a claimant has made a prima facie case that he is entitled to a pension benefit but lacks access to the key information about corporate structure or hours worked needed to substantiate his claim and the defendant controls such information, the burden shifts to the defendant to produce this information. The district court correctly held that to recover statutory penalties based on a plan administrator’s refusal to comply with ERISA’s disclosure obligations, a plaintiff must qualify as a plan participant. The court reversed and remanded for the district court to apply the now-clarified burden of proof in this case. View "Estate of Barton v. ADT" on Justia Law