Justia ERISA Opinion Summaries

Plaintiff filed a putative class action against her former employer, Dignity Health, alleging that the company has not maintained its pension plan in compliance with the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. Although Dignity Health concedes it has not complied with ERISA, it contends that the plan qualifies for ERISA’s church-plan exemption. The district court awarded partial summary judgment to plaintiff, ruling that Dignity Health’s pension plan must comply with ERISA. The court agreed with its sister circuits and held that a church plan must be established by a church or by a convention or association of churches, and maintained either by a church or by a principal-purpose organization. Accordingly, the court affirmed the judgment and remanded for further proceedings. View "Rollins v. Dignity Health" on Justia Law

After plaintiff's long term disability benefits were terminated, plaintiff filed suit under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(c)(1), against his former employer, ING, seeking statutory penalties against ING for failing to timely produce documents he had requested. The district court granted summary judgment to plaintiff and imposed a penalty of $27,475. The court affirmed the district court's decision to impose a penalty on ING North America for its failure to timely produce the Plan Document; the court reversed the district court’s decision to impose a penalty based on ING North America’s failure to timely produce the emails at issue; the court joined its sister circuits and held that penalties under 29 U.S.C. 1132(c)(1) can only be assessed against “plan administrators” for failing to produce documents that they are required to produce as plan administrators; and 29 C.F.R. 2560.503-1(h)(2)(iii) does not impose any requirements on plan administrators, and so cannot form the basis for a penalty under 29 U.S.C. 1132(c)(1). Accordingly, the court vacated the penalty award and remanded to the district court to assess a penalty based solely on the failure to timely produce the Plan Document. View "Lee v. ING Groep" on Justia Law

Trachte, a Wisconsin manufacturer, established an employee stock ownership plan (ESOP) in the mid-1980s. In the late 1990s, Fenkell and his company, Alliance, began buying ESOP-owned, closely-held companies with limited marketability. Typically, Fenkell would merge the acquired company's ESOP into Alliance’s ESOP, hold the company for a few years with its management in place, and then spin it off at a profit. Alliance acquired Trachte in 2002 for $24 million and folded its ESOP into Alliance’s ESOP. Trachte’s profits, however, were flat and its growth stalled, so Fenkell arranged a complicated leveraged buyout involving creation of a new Trachte ESOP managed by trustees beholden to Fenkell. The accounts in the Alliance ESOP were spun off to the new Trachte ESOP, which used the employees’ accounts as collateral to purchase Trachte’s equity back from Alliance, Trachte and its new ESOP paid $45 million for Trachte’s stock and incurred $36 million in debt. The purchase price was inflated; the debt load was unsustainable. By the end of 2008, Trachte’s stock was worthless. The employee participants in the new ESOP sued Alliance, Fenkell, and trustees, alleging breach of fiduciary duty in violation of the Employee Retirement Income Security Act. The district court found the defendants liable, crafted a remedial order to make the class whole, awarded attorney’s fees, and approved settlements among some of the parties. Fenkell conceded liability. The Seventh Circuit​ affirmed the order requiring him to indemnify his cofiduciaries. View "Chesemore v. Fenkell" on Justia Law

Plaintiffs, retirement-plan participants and one plan administrator, filed a putative class action on behalf of the plans themselves, contending that the plans were being cheated of certain plan assets. Specifically, Plaintiffs alleged that Defendants, various Fidelity entities that had trust agreements with the plans, were dealing with plan assets in breach of fiduciary duties imposed by the Employee Retirement Income Security Act. The district court dismissed the complaint for failure to state a claim. The First Circuit affirmed, holding that the district court did not err in its judgment. View "Kelley v. Fidelity Mgmt. Trust Co." on Justia Law

The issue this case presented for the Tenth Circuit's review involved claims under the Employee Retirement Income Security Act of 1974 (ERISA). Trent Lebahn and his wife claimed that a pension-plan consultant breached a fiduciary duty by misstating the amount of the monthly pension payments that Mr. Lebahn would receive if he were to retire. The Tenth Circuit found that under ERISA, the plan consultant could be considered a fiduciary only if she exercised discretionary authority over the plan’s administration. The Tenth Circuit addressed whether a consultant exercises discretionary authority in administering the plan simply by making a calculation of benefits at the request of a plan participant Finding that a consultant does not exercise discretionary authority under these circumstances, the Tenth Circuit affirmed judgment in favor of the pension plan and its consultant. View "Lebahn v. National Farmers Union" on Justia Law

Plaintiffs, on behalf of themselves and others similarly situated, sought declaratory relief under section 502(a)(3) of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(a)(3), injunctive relief, damages, attorney’s fees, and costs, against Berkshire and Acme. The district court granted defendants' motion to dismiss all claims. The court concluded that Acme did not violate the plans and did not breach its fiduciary duties when it adopted the amendment consistent with the plans’ terms and the law. Therefore, dismissal of plaintiffs' claims against Acme was appropriate. The court held that plaintiffs have pleaded sufficient facts to assert a plausible claim to relief against Berkshire. All of plaintiffs’ claims against Berkshire may proceed, except for its breach-of-contract claim that was not appealed and its participation in Acme’s breach-of-fiduciary-duty claim. Because the court found that plaintiffs did not plead sufficient facts to assert a plausible breach-of-fiduciary-duty claim against Acme, the court also found that the derivative participation claim fails against Berkshire. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Hunter v. Berkshire Hathaway" on Justia Law

Plaintiff filed suit against his former employer, Ericsson, asserting a claim under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. Despite filing that federal claim in a federal forum, plaintiff alternatively sought declaratory relief that ERISA did not govern this dispute over the Severance Plans. The district court ruled that ERISA governed the case and later granted summary judgment for Ericsson. The court concluded that Ericsson’s Plans check off most of the factors indicative of ERISA plans, and thus plaintiff's suit seeking to obtain benefits available under them, are governed by the federal statute. On the merits, the court concluded that the district court did not err in ruling as a matter of law that the Plan allowed Ericsson to deny benefits on the ground that plaintiff failed to meet the return of property condition. Given the absence of language entitling plaintiff to severance pay based solely on the release of legal claims, it is not inconsistent with the Plan to impose other conditions reasonably related to the termination of the employment relationship. In this case, a provision requiring the return of property is in line with the overall terms of the Plans, which are aimed at providing severance to those who depart the company on good terms through no fault of their own. Accordingly, the court affirmed the judgment. View "Gomez v. Ericsson, Inc." on Justia Law

After Prudential denied coverage of a life insurance policy, plaintiff filed suit claiming that she had no notice of the exclusion for active-duty servicemen and that the exclusion is otherwise unenforceable. The district court granted summary judgment for Prudential and UPS. Plaintiff worked for UPS and participated in a plan which provides group insurance coverage to UPS employees. Plaintiff sought coverage after plaintiff's husband was killed in a weekend motorcycle accident while off base and not on duty. The court concluded that Prudential correctly interpreted the exclusion as barring the claim where the plan indicates that a spouse is not a qualified dependent when the spouse is on active-duty in the armed forces of any country. Moreover, it was not an abuse of discretion for Prudential to interpret the exclusion to apply regardless of whether a spouse was on military duty at the time of an occurrence. The court rejected plaintiff's claim that she was not on notice of the exclusion, concluding that the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., only requires the court to simply interpret the plan. The court rejected plaintiff's claims and affirmed the judgment. View "Singletary v. Prudential Ins. Co." on Justia Law

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