If there was any theme in this week’s cases, it was tobacco surcharge litigation. The last couple of years have seen a surge in putative class actions against large employers challenging the wellness programs in their ERISA-governed health plans. These programs often impose a fee on plan beneficiaries who use tobacco, and provide for ways to eliminate that fee by satisfying a “reasonable alternative standard,” such as completing a tobacco cessation program.

The plaintiffs in these cases typically contend that the wellness programs violate ERISA’s nondiscrimination rules (e.g. 29 U.S.C. § 1182(b)) because they don’t give the “full reward” retroactively to participants who complete a cessation program, and don’t include the required “reasonable alternative standard” disclosures. Plaintiffs often bring other related claims, such as breach of fiduciary duty for failing to segregate surcharges as plan assets.

Results have been mixed. Some courts have dismissed these suits, on standing or other grounds, while others have allowed them to proceed. The litigation has even drawn the attention of the federal government, which weighed in recently with tri-agency guidance.

This week we have three cases that span the gamut of this litigation. In one, the court weeded out most of the plaintiffs’ claims but allowed their inadequate notice claim to proceed (Kiles v. Goodyear). In another the court preliminarily approved a $450,000 class settlement (Takala v. Nordstrom), and in a third plaintiffs scored what we believe to be the first win on summary judgment, with the court ruling in their favor across the board on their claims (Mehlberg v. Compass Group). See below for more details.

In the event regulatory deep-dives and health-contingent wellness implementation details are not your thing, we of course have other cases for you as well. They include: (1) a ruling potentially allowing discovery into privileged communications based on ERISA’s fiduciary exception to the attorney-client privilege (Collier v. Lincoln); (2) dismissal (this time with prejudice) of a putative class action against eyewear giant EssilorLuxottica for its inclusion of a Prudential-backed stable value fund in its retirement plan (Eibensteiner v. EssilorLuxottica); (3) the latest skirmish in the decade-old Patterson v. Swagelok/United saga; (4) a ruling that a life insurance beneficiary was not entitled to interest on the benefits, despite a nine-year gap between the death and the payment (Williamson v. Lunar); and last, but not least, (5) a multiemployer fund’s unsuccessful attempt to claw back pension benefits it paid to a dead plan participant (Central States v. Abraham).

As usual, we’ll be back with more next week.

Below is a summary of this past week’s notable ERISA decisions by subject matter and jurisdiction.

Arbitration

Fifth Circuit

Tyer v. Peachtree Hotel Group II, LLC, No. 1:26-CV-00744-ADA-DH, 2026 WL 3153106 (W.D. Tex. Oct. 20, 2026) (Magistrate Judge Dustin M. Howell). Charlotte Tracey Tyer worked for Peachtree Hospitality Management, LLC. She alleges that she refused to terminate another employee because of that employee’s national origin and detention by Immigration and Customs Enforcement, and that Peachtree and other defendants then retaliated against her by “blocking communication, deviating from typical discipline processes, and terminating her employment.” Proceeding pro se, she sued Peachtree and other related defendants, alleging that they “violated ERISA by interfering with her attainment of her employee benefits, breached their fiduciary duty under ERISA, and violated Title VII by retaliating against a protected activity.” Peachtree moved to compel arbitration of the Title VII claims and to stay the case pending arbitration, relying on a Mutual Dispute Resolution Agreement signed by Tyer. Applying the Fifth Circuit’s two-step framework, the assigned magistrate judge first asked whether the parties had entered into an arbitration agreement. Tyer’s complaint acknowledged the agreement, which she invoked to exclude her ERISA claims from arbitration, and Peachtree produced a signed copy that prominently stated that it included a binding arbitration provision. The court found that Tyer’s arguments were directed at waiver, enforceability, the agreement’s terms, and whether the ERISA and Title VII claims could be separated, not whether she entered into the agreement in the first place. As a result, the court found a valid contract, and moved on to the second step, i.e., whether Tyer’s claims were covered by the agreement. The agreement provided that “the arbitrator shall have the exclusive authority to resolve any dispute relating to the arbitrability of any individual claim or the enforceability or formation of this Agreement (including all defenses to contract enforcement such as, for example, waiver of the right to compel arbitration).” The court held that this language delegated “gateway questions of arbitrability to the arbitrator.” As a result, it covered Tyer’s arguments that Peachtree waived arbitration through pre-suit repudiation and that the agreement was unenforceable for other reasons. Because Tyer did not specifically challenge the delegation clause itself, the court was bound to enforce it, “leav[ing] any challenge to the validity of the Agreement as a whole for the arbitrator.” Tyer’s ERISA claims did not save her: “The agreement also forecloses her argument that her ERISA claims are too intertwined with her Title VII claims: ‘Enforcement of this Agreement may not be precluded… on the grounds that… a party to this Agreement asserts arbitrable and non-arbitrable claims. In [that situation], either party may file a motion to stay the litigation of non-arbitrable claims until the arbitrable claims are resolved in arbitration[.]’” The magistrate thus recommended granting Peachtree’s motion to compel. He further recommended staying the case pending arbitration because “Tyer’s ERISA and Title VII claims arise from the same operative facts,” and, as Tyer admitted, were “inextricably intertwined[.]”

Breach of Fiduciary Duty

Fifth Circuit

Eibensteiner v. EssilorLuxottica USA Inc., No. 3:25-CV-2443-X, 2026 WL 3182479 (N.D. Tex. Oct. 23, 2026) (Judge Brantley Starr). The plaintiffs in this case are participants in the EssilorLuxottica Retirement Savings Plan who contend that EssilorLuxottica USA Inc. and its ERISA Committee violated ERISA by including a Guaranteed Income Fund in the plan. The Fund is a stable value option backed by Prudential Retirement Insurance and Annuity Company. The court dismissed plaintiffs’ first amended complaint without prejudice (as we discussed in our May 6, 2026, edition), so they tried again. Their second amended complaint alleges that defendants breached their duty of prudence by selecting and keeping a guaranteed investment contract with lower crediting rates than similar investments, failed to negotiate reasonable recordkeeping and administration fees, and failed to monitor the plan’s fiduciaries. Defendants again moved to dismiss for failure to state claim. Beginning with the duty of prudence claim, the court agreed with defendants on all four of their arguments. First, the court had previously held that plaintiffs did not establish that their comparator funds were sufficiently similar to the Fund to support a meaningful comparison. The court stated that the Fifth Circuit has not defined a “meaningful benchmark,” but other courts distinguish actively and passively managed accounts, look to similar investment strategy and risk profile, and do not blindly accept the labels “comparable” or “peer.” The second amended complaint added that other stable value funds “share similar investment strategies,” but this criterion still “relies on far too high of a level of abstraction.” The complaint “still lacks the ‘why’ the Court requires to find that comparators are meaningful.” Four of plaintiffs’ top five comparators were managed by an affiliate of the plan’s sponsor, which could reasonably give better rates to affiliates, and the fifth was not even a stable value fund at all. Plaintiffs’ other comparators were applied “interchangeably and inconsistently, depending on the year,” which amounted to “cherry-picked evidence.” Second, plaintiffs’ attempt to show that the Fund was imprudent also failed. Their only new allegation was that other insurers offered plans with higher surplus to liability ratios, but they did not explain why that criterion matters or why those carriers should be compared. Third, plaintiffs’ fiduciary process theory was self-contradictory, because they could not explain why the Committee’s decision not to act for a time was imprudent while its eventual decision to switch to another stable value fund was also imprudent. That would put the defendants in a “damned-if-you-do-damned-if-you-don’t situation.” The court acknowledged that a fiduciary has a continuing duty to monitor investments and that a plaintiff may plead that a superior alternative was readily apparent. But the “test of prudence…is one of conduct, and not a test of the result of performance of the investment.” Plaintiffs alleged no malfeasance beyond accusing the fiduciaries of being “asleep at the wheel,” and their evidence boiled down to results, which was a “performance-oriented analysis” that the Fifth Circuit has “found…inappropriate.” Fourth, a study the plaintiffs relied on did not support their claims. The Stable Value Institute of America benchmark examined 135,000 plans serving about 42 million participants from January 2010 through December 2019, but the plaintiffs’ class period began in September 2019, so the study overlapped with it for less than four months. While a market index might on occasion serve as a meaningful benchmark, plaintiffs’ composite of disparate strategies was a poor comparator, and thus plaintiffs could not compare it to the Fund “any more than they can compare the moon to a baseball, though they are both spheres.” Next, the court examined plaintiffs’ excessive recordkeeping fees claim. The first amended complaint had asserted a prohibited transaction claim under ERISA § 406(a)-(b), which the court dismissed without prejudice because it did not allege whether Prudential was already providing services to the plan, and thus a party in interest, when the relevant contract was entered. The court had limited any amended complaint to changes “needed to cure the deficiencies identified by this Order.” Instead of curing that defect, the plaintiffs brought a new claim that the plan’s recordkeeping and administration fees were excessive. The court rejected plaintiffs’ argument that their new claims were valid because they did not prejudice defendants, holding that it “will not permit parties to bring new claims in an amended complaint after limiting the scope of that complaint.” Finally, plaintiffs’ failure to monitor claim was derivative of their prudence claim and thus was also unsuccessful. As a result, the court granted defendants’ motion to dismiss, this time with prejudice.

Sixth Circuit

Kiles v. Goodyear Tire & Rubber Co., No. 5:26-CV-179, 2026 WL 3135912 (N.D. Ohio Oct. 8, 2026) (Judge Christopher A. Boyko). To keep health coverage under the Goodyear Health Plans, Goodyear employees must declare each year whether they use nicotine; users must pay a surcharge. According to the complaint, employees and spouses paid more than $17 million in surcharges from 2020 through 2025. Plaintiffs, former Goodyear employees who paid the surcharge, allege that it was unlawful because the program fell outside of ERISA’s safe harbor for bona fide wellness programs. The summary plan description describes the American Cancer Society’s “Quit for Life” program as an option, and promises retroactive reimbursement of the surcharge on completion, but plaintiffs alleged that participant materials omitted the statement, required by 29 C.F.R. § 2590.702(f)(4)(v), that the recommendations of a participant’s personal physician will be accommodated. They asserted three claims: (1) failure to give required notice; (2) breach of fiduciary duty under § 502(a)(2), on the theory that Goodyear used the surcharges to offset its own contributions to the plans; and (3) breach of fiduciary duty and prohibited transactions under § 502(a)(3). Goodyear moved to dismiss under Rules 12(b)(1) and 12(b)(6). On standing, Goodyear argued that the notice claim alleged only an “informational injury” and that plaintiffs did not allege that they had a medical condition qualifying for the physician alternative or would have acted differently with better notice. The court disagreed, accepting plaintiffs’ argument that they did not claim injury from the missing notice. Instead, they claimed that the wellness program violated ERISA. Thus, if Goodyear “could not lawfully impose the tobacco surcharge on nicotine users,” then the surcharge was illegal, and plaintiffs suffered direct monetary harm from an allegedly unlawful plan and had standing. On the merits of the notice claim, Goodyear argued that the statute, 42 U.S.C. § 300gg-4(j)(3)(E), requires only disclosure of the availability of a reasonable alternative standard, which the “Quit for Life” reference satisfied. Furthermore, they argued that the physician-accommodation statement appears only in the regulation, which was not binding pursuant to the Supreme Court’s 2024 decision in Loper Bright Enterprises v. Raimondo (holding that agency interpretations of regulations are not entitled to deference). The court disagreed. Congress had delegated the authority to prescribe regulations necessary or appropriate to carry out the statute, and Loper Bright itself recognized that statutes may “empower an agency to prescribe rules to ‘fill up the details’ of a statutory scheme.” The court thus concluded that § 2590.702 “is a clarification of § 300gg-4’s notice requirements rather than an additional requirement,” so the physician-accommodation disclosure requirement was valid and plaintiffs plausibly alleged a violation. Thus, defendants’ motion regarding the first claim was denied. The fiduciary claims fared differently. Goodyear argued that they challenged settlor rather than fiduciary conduct, and the court agreed. It explained that an employer acts as settlor, not a fiduciary, in establishing, funding, amending, and terminating a plan, and that “day-to-day corporate business transactions” need not be performed solely in participants’ interest. The § 502(a)(2) claim also failed. Plaintiffs offered only “bare-bones, conclusory allegations” that Goodyear enriched itself at the plans’ expense, and without the plan documents there was no basis to infer that Goodyear owed contributions on top of the surcharges. Any harm from higher premiums fell on employees, not the plans. The § 502(a)(3) claim failed for a different reason. The court acknowledged that informing participants about a plan is a fiduciary function, but plaintiffs did not allege that the lack of disclosure was a breach that harmed them individually. The prohibited transaction theory also failed. The court observed that plaintiffs’ theory was that Goodyear contributed less of its own money, not that the plans were shortchanged. However, plaintiffs did not plausibly allege that the plans were underfunded or unable to pay benefits. As a result, the case will proceed, but only on plaintiffs’ first claim for relief regarding inadequate notice. Plaintiffs’ request for leave to amend, made at the end of their opposition brief, was denied.

Eighth Circuit

Mehlberg v. Compass Group USA, Inc., No. 24-cv-04179-SRB, __ F. Supp. 3d __, 2026 WL 3139083 (W.D. Mo. Oct. 16, 2026) (Judge Stephen R. Bough). Since 2016, foodservice giant Compass Group USA, Inc. has charged participants in its medical plan who use tobacco a surcharge, deducted from their paychecks and kept in Compass Group’s general assets. Participants were identified through an annual self-attestation. Compass Group offered an alternative standard to avoid the surcharge, such as a free tobacco cessation course, but it removed the surcharge only prospectively for the rest of the plan year, and the self-attestation said nothing about the alternative standard from 2016 through 2024. In mid-2024, Compass Group began reimbursing surcharges retroactively, but it did not disclose that until its 2025 enrollment guide. The parties agreed that almost $48 million in surcharges was collected from 2016 through May of this year. Plaintiffs Richard Mehlberg and Angela Deibel challenged Compass Group’s tobacco surcharge in this action, suing on behalf of a putative class and the plan, asserting six counts: violations of ERISA’s nondiscrimination provision (Count I) and of the wellness program disclosure requirements (Count II), breach of fiduciary duty on behalf of the plan (Count III) and individually (Count IV), and violation of plan terms under §§ 502(a)(3) and (a)(1)(B) (Counts V and VI). The court previously denied a motion to dismiss, and earlier this year it certified four classes (which we covered in our April 22, 2026, edition). The parties then filed 350 pages of briefing in support of their cross-motions for summary judgment, which were resolved in this published decision. On Article III standing, the court held that paying an unlawful surcharge is an injury in fact, because “[p]aying a fee they should not have been charged [is] a concrete injury.” It ruled that plaintiffs did not need to show that “informational deprivation caused some ‘downstream consequence.’” On statutory standing, the court ruled that § 1182’s non-discrimination provision protects “any individual,” and the medical-condition exemption from the surcharge, in 42 U.S.C. § 300gg-4(j)(3)(D), operated as an affirmative defense rather than a limit on who is allowed to sue. The court also rejected Compass Group’s challenge to the Department of Labor’s 2013 regulation on this issue because Congress had “called upon the Department of Labor’s expertise” in interpreting the statute, consistent with the Supreme Court’s recognition in Loper Bright Enterprises v. Raimondo that agencies may “fill up the details.” Turning to the merits, on Count I the court held that the statute’s “full reward” requirement is unambiguous and requires retroactive reimbursement for a participant who completes the alternative standard mid-year. Because “reward” includes “the absence of a surcharge” and “full” means all, prospective-only relief would mean “the best a tobacco user could hope for would be a partial reward for a given plan year.” A contrary reading would let plans discriminate for most of the year by offering the alternative at year’s end. The court noted that the 2013 regulation supported this conclusion. It rejected defendants’ argument based on the anti-parroting doctrine (which provides that courts will not grant an agency deference when it interprets its own regulation if the regulation is essentially the same as the statute) because it was “Congress that was copying the agency,” not the other way around. On Count II, the court found that the self-attestation form for 2016 through 2024 referenced a premium differential based on tobacco use but disclosed no reasonable alternative standard, and the 2025 and 2026 enrollment guides omitted the statement that a personal physician’s recommendations would be accommodated. Thus, Compass Group “did not provide the requisite disclosures” and plaintiffs were entitled to summary judgment. On Counts III and IV, the surcharges were employee contributions and thus plan assets, which Compass Group never segregated even though a dedicated payroll code made that easy. Defendants tried to rely on the applicable regulation’s “reasonable segregation” provisions, but the court explained that the 90-day period in the regulation is the “absolute outer bounds” and does not give employers “three months of impunity to commingle the funds at their leisure.” On Counts V and VI, the court held that plan language stating that it “shall be administered in accordance with” the ACA and PHSA and “is intended to operate in compliance with” federal law created an enforceable promise beyond plaintiffs’ statutory claims. The court rejected defendants’ argument that these were simply “generic representations of legal compliance.” Finally, the court addressed remedies. It ruled that equitable surcharge under § 502(a)(3) was available, regardless of whether it represented “recovery of specific traceable funds,” and that such a remedy was not limited to fiduciary claims. The court also addressed various statutes of limitations that affected calculation of a surcharge remedy, which reduced some of the relief plaintiffs could obtain. The court deferred awarding a specific amount of damages, ordering the parties to file briefs within fourteen days on damages, additional discovery, and duplicative recovery. As a result, the decision was nearly a clean sweep for plaintiffs, and as we noted in the introduction, a rare one: Your ERISA Watch believes that this ruling represents the first win by plaintiffs on summary judgment in the wave of tobacco surcharge lawsuits that have swept through the federal courts in the last two years.

Class Actions

Ninth Circuit

Takala v. Nordstrom, Inc., No. 2:25-cv-1396-JHC, 2026 WL 3131993 (W.D. Wash. Oct. 19, 2026) (Judge John H. Chun). Amy Takala and Jennifer Wescott brought this putative ERISA class action against Nordstrom, Inc. over its employee wellness program. Their claims concerned the imposition and administration of tobacco or nicotine surcharges, alleged deficiencies in notice of a reasonable alternative standard, the alleged failure to provide the “full reward” as required by applicable law, and alleged breaches of fiduciary duty. The parties reached a settlement agreement on September 14, 2026, and the plaintiffs moved for preliminary approval. In this order the court briskly granted the motion. It preliminarily found for settlement purposes that the proposed class was ascertainable from plan records and too numerous for joinder, and that the Rule 23(a) requirements of commonality, typicality, and adequacy were met. The court also found that separate actions by individual class members would risk inconsistent adjudications or adjudications that would, as a practical matter, dispose of the interests of absent members. On that basis it preliminarily certified a settlement class under Rule 23(b)(1). The class consists of individuals residing in the United States who paid a tobacco or nicotine surcharge in connection with participation in Nordstrom’s health and welfare benefit plan, for themselves or a covered spouse, domestic partner, or dependent, from July 24, 2019, through entry of the preliminary approval order. Finding the class sufficiently “well-defined and cohesive,” the court certified it as a non-opt-out class, so class members will be bound by any judgment on the settlement, subject to the court’s final determination. After considering the Rule 23(g) factors, the court designated Siri & Glimstad LLP as class counsel. It also found the class representatives adequate and typical, but the order appointed “Kelly Rogers, Kathryn Deisinger O’Flaherty, and Wyndham Hasler” as the class representatives rather than the two named plaintiffs, which appears to have been a typographical error. Next, the court preliminarily approved the settlement, finding that it resulted from arm’s-length negotiations after class counsel researched multiple legal and factual issues, that a “genuine controversy” exists over Nordstrom’s compliance with ERISA and its administration of the wellness program, and that the settlement appears on its face to be fair, reasonable, and adequate enough to warrant notice to the class. It likewise preliminarily found the plan of allocation fair, reasonable, and adequate. The order did not state the settlement amount, but it has been reported as $450,000. The court set a final approval hearing for February 17, 2027. Class counsel’s motion for final approval and its application for fees, expenses, and case contribution awards of up to $7,500 per class representative are due 45 before the hearing, the parties must respond to objectors five business days before it, and Nordstrom must file proof of compliance with the Class Action Fairness Act ten days before it.

Disability Benefit Claims

Second Circuit

Doolittle v. Hartford Life & Accident Ins. Co., No. 1:25-cv-00148 (BKS/CBF), 2026 WL 3135297 (N.D.N.Y. Oct. 20, 2026) (Judge Brenda K. Sannes). Micky Doolittle, a former employee of New England Motor Freight, Inc., received long-term disability benefits under an insured plan governed by ERISA, with Hartford Life and Accident Insurance Company as claim administrator. The group policy insuring the plan gave Hartford “full discretion and authority” to interpret its terms and allowed Hartford to reduce monthly benefits by “Other Income Benefits,” including Social Security disability (SSD) benefits. While Doolittle’s SSD application was pending, he signed a reimbursement agreement with Hartford in which he selected an option that allowed him to receive his benefits “with no reduction for Social Security Benefits,” and acknowledged that this “may result in an overpayment” that he would have to refund in a lump sum. In 2022 the Social Security Administration found him disabled and awarded about $41,781 in retroactive benefits, withholding $10,445.25 for a representative’s fee. Hartford calculated an overpayment of $43,890, Doolittle paid $10,000, and Hartford credited $6,000 as the maximum allowable attorney’s fee and began withholding his monthly benefits in 2022. The balance declined steadily until Hartford reported in July 2026 that it had been fully recouped and issued a $780 refund, after which benefits resumed. Meanwhile, in 2025, Doolittle brought this pro se action alleging state law claims, which the court found preempted by ERISA (as we reported in our September 17, 2025, edition). After Doolittle amended his complaint, the court allowed him to proceed on a § 502(a)(1)(B) claim based on the allegation that Hartford kept withholding benefits after the overpayment had been recovered (as we reported in our February 4, 2026, edition). The parties then cross-moved for summary judgment and this order was the result. Because the policy conferred discretion, the court reviewed Hartford’s withholding under the arbitrary and capricious standard of review. Doolittle argued that Hartford withheld his benefits “with no consistent calculation or documented rationale.” However, the court noted that Doolittle had signed the reimbursement agreement, and courts “routinely have enforced SSDI offset provisions in ERISA Plans as written, as well as Reimbursement Agreements similar to [the one] at issue here.” Hartford was therefore entitled under the plain language of the policy and the agreement to withhold benefits to recover its overpayment. The court rejected the argument that Hartford’s calculations “changed over time and included acknowledged errors.” Hartford admitted that its figures had changed, but only because the balance fell as it withheld benefits and applied credits. The court did note errors in Hartford’s correspondence, but found that Hartford had promptly corrected them. “[T]he sole discrepancy the Court can identify in Hartford’s calculation of the Overpayment is that Hartford credited $6,000.00 for attorney’s fees, whereas the Social Security Administration initially withheld twenty-five percent of Plaintiff’s retroactive award, or $10,445.25, for a representative fee.” However, Hartford explained that $6,000 was the maximum allowable fee at the time of the award and the SSA’s withholding was not final pending its approval of the fee. Thus, even assuming the difference was not refunded, “the Court cannot find that Hartford acted arbitrarily because it credited Plaintiff with a lower amount for attorney’s fees, when that amount was the maximum permitted under the law.” As for “other deviations” between the SSA award and calculated overpayment, the court found that they stemmed from Hartford’s underestimating Doolittle’s SSD benefits, since it used his original monthly amount despite cost-of-living increases, and from a $500 credit that Hartford mistakenly applied and was not seeking to recover. In the end, Hartford’s decision rested on the agreement and policy, and the record showed that its representatives repeatedly responded to Doolittle’s concerns and corrected errors, so its withholding was not arbitrary and capricious. The court then turned to two claims that Doolittle raised for the first time in his summary judgment motion, noting that they were new arguments that “need not be considered.” One was a claim under ERISA § 104(b)(4) premised on an administrative record that allegedly “omitted numerous relevant documents and included duplicates and missing sequence numbers.” The court noted that Doolittle did not allege that Hartford ignored a written request for documents, that the record was complete on his sole remaining claim, and that a supposedly missing sequence number resulted from a black border obscuring a Bates label. The second claim was an intentional infliction of emotional distress claim, over which the court declined to exercise supplemental jurisdiction. As a result, the court denied Doolittle’s motion for summary judgment, granted Hartford’s, and dismissed the case.

Ninth Circuit

Wong v. Metropolitan Life Ins. Co., No. 25-cv-10274-PCP, 2026 WL 3138805 (N.D. Cal. Oct. 20, 2026) (Judge P. Casey Pitts). Shifang Wong, a scientist at the biotechnology company Adicet Bio, worked on cancer research and cell therapy drug products in a job that demanded “4-8 hours of uninterrupted focus,” “zero tolerance for error,” and “sustained concentration, emotional regulation, and cognitive stamina.” Beginning in 2021 she alleged she endured severe bullying and harassment, including coworkers interfering with her experiments and smearing her car with mud, and by late 2023 she told her manager she could not complete her assigned experiments. Her primary care physician diagnosed major depressive disorder, panic attacks, and insomnia, noted memory and focus difficulties, and took her off work beginning November 8, 2023. A psychiatric nurse practitioner, Nima Lal, then treated her two to three times a month for a year, diagnosed generalized anxiety disorder and major depressive disorder, wrote out-of-work notes throughout, and opined in late 2024 that returning to work would “only exacerbate her condition.” Wong submitted a claim for benefits under Adicet’s long-term disability (LTD) benefit plan, insured by Metropolitan Life Insurance Company, in June 2024. MetLife denied Wong’s claim on the strength of a records review by an independent psychologist, Dr. Ghannam, who found her mental status “notably unremarkable aside from mood abnormalities” and noted that she was not suicidal and had not been hospitalized. On appeal, a second reviewer, Dr. Richardson, agreed and discounted her cognitive complaints because she offered “no clinical, measurable, and fully validated evidence to support impaired cognition.” MetLife thus upheld the denial in August 2025. Meanwhile, MetLife had awarded Wong short-term disability (STD) benefits for a later period, based largely on two interviews by its psychiatric specialist, who concluded that Wong was limited in her ability to sustain concentration and focus, and then extended the award to the maximum period. Wong sued MetLife under ERISA § 502(a)(1)(B), and the parties cross-moved for judgment under Rule 52, agreeing that de novo review applied. The court found that every practitioner who actually interacted with Wong, including MetLife’s STD reviewer, concluded that she could not work or that her cognitive functioning was impaired. By contrast, MetLife’s LTD reviewers never had the opportunity to “know and observe” her. A “pure paper” review “raise[s] questions about the thoroughness and accuracy of the benefits determination,” and discounting mental functioning complaints is “particularly troubling” when the reviewer has “never met the claimant.” The court emphasized the cognitive rigor of Wong’s job, finding it relevant that her job required “higher levels of mental functioning, including concentration and memory.” Even a “relatively moderate hind[]rance” could interfere with her ability to work as a scientist. Drs. Ghannam and Richardson “seemingly evaluated whether Wong was disabled from performing any work at all,” without explicitly considering the demands of her usual occupation. Their observations that she was not suicidal and had not been hospitalized “do not speak to Wong’s ability to work as a scientist,” leaving MetLife with “almost no evidence to rebut the opinions of Wong’s practitioners.” As for the paucity of objective testing, the court held that “Wong did not need more.” MetLife could not “fully discredit” subjective accounts of anxiety, depression, and cognitive functioning for lack of objective testing, and the absence of neuropsychological testing did not undermine her documented symptoms, “particularly when MetLife never asked for it.” As for the STD benefits, the court declined to find that they created a presumption of entitlement to LTD benefits, as nothing in the record showed whether the STD plan defined disability as the LTD plan did, and Wong sought STD benefits for a different time period. However, the findings of MetLife’s STD reviewer, which were part of the administrative record, served as additional evidence supporting Wong. The court rejected MetLife’s three counterarguments. Wong’s statements that she felt “okay” on some days, and notations of “intact” and “attentive” cognition, showed only that she was not completely disabled, which was not the correct standard, since “even moderate impairment” to cognitive function was sufficient to support inability to perform her job. MetLife’s argument that Wong’s impairments were specifically tied to her experience at Adicet, and that she could work elsewhere, was unsupported because other evidence addressed her cognitive difficulties generally. And MetLife’s causation argument that “bullying and harassment,” rather than a “sickness or illness,” caused her conditions misread the plan, which “imposes no restriction on coverage for mental conditions that were themselves triggered by other events.” The court thus granted Wong’s motion for judgment, denied MetLife’s cross-motion, and awarded Wong LTD benefits.

Discovery

Second Circuit

Nadarajah v. Provident Life & Accident Ins. Co., No. 26-CV-1841 (JPO), 2026 WL 3151102 (S.D.N.Y. Oct. 21, 2026) (Judge J. Paul Oetken). Jeyakumar Nadarajah sued The Provident Life and Accident Insurance Company regarding his former employer’s disability insurance program, which was insured by Provident. The case was removed from state court, and the parties are now disputing whether ERISA governs Nadarajah’s claims. Provident moved to stay discovery until that question is resolved. It argued that if ERISA applies, review will be largely confined to the administrative record, discovery will be limited or unnecessary, and discovery on Nadarajah’s state law claims will be foreclosed. Nadarajah disagreed, contending that “[t]he issue of whether ERISA governs is fact-intensive and itself requires discovery, thus making it inappropriate for early resolution.” In this brief order the court denied Provident’s motion. It first held that discovery is appropriate on at least the threshold question of whether ERISA governs, relying on various cases from within the district. Provident contended that the documents already in the record showed that the program was endorsed by Nadarajah’s former employer, and therefore that ERISA governs. Nadarajah countered that more discovery was needed on endorsement, including the agreements between Provident and the former employer, the employer’s communications to employees about the program, documents on the program’s administration, and deposition testimony. The court agreed with Nadarajah. The documents Provident cited indicated that the former employer was likely required to “sponsor and endorse the voluntary purchase of policies,” including through an “employer endorsement letter,” but they were “not necessarily dispositive.” Provident did not attach the endorsement letter or point to other record evidence that one was issued, and thus “Provident gives the Court no reason to believe that the necessary additional discovery on this issue has already occurred, such that discovery on other issues (e.g., Nadarajah’s state-law claims) ought to be stayed. It appears therefore that discovery continues to be necessary because it may at least be helpful on the question of ERISA’s applicability.” The court added that a stay would be premature in any event because, as Provident conceded, “the ERISA issue warrants full briefing.” It invited Provident to move for partial summary judgment on ERISA’s applicability, but in the meantime, “the Court will not stay discovery on the theory that it will resolve this question when, other than a sua sponte undertaking, it has no vehicle to do so.” The court thus denied Provident’s motion to stay discovery and directed the parties to prioritize discovery on the applicability of ERISA before discovery closes next month.

Sixth Circuit

Jacobs v. Fidelity Workplace Services, LLC, No. 1:25-CV-1719, 2026 WL 3150621 (N.D. Ohio Oct. 21, 2026) (Magistrate Judge Jennifer Dowdell Armstrong). In this action Sherlyn Jacobs, proceeding pro se on her own behalf and as representative of the estate of her late husband, Marvin Jacobs, has sued Fidelity Workplace Services, LLC, the administrator of General Motors’ pension plan. Marvin worked for GM for more than 30 years and died in 2023. Sherlyn alleged that the couple married in 2020, that Marvin submitted the paperwork to name her as his survivor beneficiary under the GM pension plan, and that in September 2021 he called Fidelity, in a call she says was recorded, and a representative confirmed that she was listed as the beneficiary. According to Sherlyn, Fidelity nevertheless rejected her claim for benefits, has not produced the recording or the forms, and is allegedly paying Marvin’s benefits to a former wife from whom he divorced in 1998. She asserted claims under ERISA for wrongful denial of benefits, failure to provide plan documents, and breach of fiduciary duty. Fidelity contends that Marvin never completed the HRP-60 form which would have removed his prior spouse and added Sherlyn, and that it is not the plan administrator for purposes of Sherlyn’s document request. At the initial case management conference, Fidelity agreed to produce the complete administrative record, including written communications and recorded phone calls, but opposed further discovery. In contrast, Jacobs sought “full discovery under the Federal Rules of Civil Procedure.” Fidelity produced the administrative record, but Jacobs was unhappy. She filed a motion to compel, which asked the court “to compel the production of ‘a complete and readable administrative record’ and ‘accurate call logs and recordings.’” She accused Fidelity of, among other things, producing “microscopic” and “unreadable” call logs and “silent” recordings. Jacobs’s motion was denied without prejudice for failing to meet and confer. During the meet and confer process, Fidelity produced additional records, including some it did not consider part of the administrative record, and an affidavit stating that an “exhaustive search” had not located the September 2021 call. Jacobs then filed an “ERISA Procedural Challenge” to the record. In this order the court began with the rule in ERISA cases that review is generally confined to the administrative record, which reflects “the facts known to the administrator” when it made its decision. The court construed part of Jacobs’s filing as an evidentiary objection to the contents of the record. However, Jacobs could not identify any document in Fidelity’s possession that had been omitted, and her suggestion that the record was incomplete was “pure speculation.” Fidelity had represented that the documents were “produced as received” and had supported its search for the missing call with an affidavit. “Ordinarily, the representation of a party’s attorney that no additional documents exist is sufficient to defeat a motion to compel absent credible evidence that the representation is inaccurate.” Thus, the court rejected Jacobs’s challenge to the contents of the administrative record. The court then addressed Jacobs’s requests for discovery relating to “procedural irregularities in Fidelity’s consideration of her benefits claim.” On this issue, Jacobs did not argue bias. Instead, her theory was that Fidelity denied her due process in administering the plan and in considering her claim. The court found that the record, which included materials showing that the HRP-60 form was explained to and sent to Marvin and provided to Sherlyn – but never properly completed – provided her with “meaningful review.” Jacobs pointed to nothing contradicting Fidelity’s explanation, and the extensive record contained a log and 40 recordings. Because Jacobs “has not shown even ‘the barest of an additional showing’ of a procedural irregularity or bias here,” her request for discovery was denied.

Ninth Circuit

Collier v. Lincoln Life Assurance Co. of Boston, No. 8:20-cv-00839-JVS-KESx, __ F. Supp. 3d __, 2026 WL 3126569 (C.D. Cal. Oct. 5, 2026) (Magistrate Judge Karen E. Scott). Vicki Collier brought this action against Lincoln Life Assurance Company of Boston for wrongfully denying her claim for ERISA-governed long-term disability benefits. The district court upheld the denial, but in November 2022 the Ninth Circuit reversed and remanded in a published opinion, holding that a district court “must examine only the rationales the plan administrator relied on in denying benefits and cannot adopt new rationales that the claimant had no opportunity to respond to during the administrative process.” According to the Ninth Circuit, the district court had improperly relied on new findings that Collier was not credible and that her claim lacked objective medical evidence. (This ruling was Your ERISA Watch’s case of the week in our November 23, 2022, edition.) After an unsuccessful post-appeal mediation, the district court remanded the claim to Lincoln, which upheld its denial in January of 2025. The case thus returned to district court, where Collier demanded a detailed privilege log and access to all communications between Lincoln and its in-house and outside counsel during the remand period, arguing that such communications were discoverable pursuant to the fiduciary exception to the attorney-client privilege and work product doctrine. Lincoln served a privilege log, with all entries claiming attorney-client privilege and thirteen also claiming work product protection, and argued that the fiduciary exception no longer applied because the parties’ interests had diverged when the litigation began and was not revived on remand. In this order, the assigned magistrate judge explained at the outset that the fiduciary exception to the privilege applies to advice on plan administration, but that the privilege “reasserts itself” as to advice a fiduciary obtains to protect herself from civil or criminal liability. The court first rejected Lincoln’s argument that its potential liability for attorney’s fees revived the privilege. The court noted that no one at Lincoln faced personal civil or criminal liability, and treating fee exposure, which exists whenever a claim is wrongfully denied under ERISA, as sufficient “would effectively nullify the fiduciary exception.” The court then held that the fiduciary exception revives on remand. It rejected a bright-line rule that the exception ends forever once litigation begins, as no case supported that proposition. Instead, “if on remand the plan administrator must again act as a fiduciary, then the fiduciary exception should be revived as to attorneys giving legal advice about plan administration. A contrary rule would free the plan administrators to act as litigation adversaries even while considering a remanded claim, which would defeat the purpose of remand.” Litigation counsel’s communications with Lincoln about how to evaluate Collier’s claim on remand would likely fall within the exception, but communications about the litigation itself would not. The court added that work product protection may still shield documents even where the exception applies. Pursuant to this framework, the court ordered Lincoln to serve an amended log identifying document type, the role of each sender and recipient, the author where it differs from the sender, and the status of email attachments, with numbered lines. It declined to require logging of communications internal to litigation counsel, which no one at Lincoln saw and which would almost certainly be protected work product, since logging them “would be busy-work.” However, communications from litigation counsel to Lincoln about the denial or the claim process, including advice on the denial’s effect on the litigation, how to decide the claim, and drafts and redlines of the denial letter, must be logged, as must any memo that counsel conveyed verbally through in-house attorneys. Lincoln could not exclude documents created between the date of remand and Collier’s first remand submission, but it could exclude documents created before that date, when the parties were “litigation adversaries.” The court refused to require a separate relevance log, finding no authority for one, and held that any deposition of the claim specialist would require a motion to the district judge. As a result, Lincoln will have to serve an amended privilege log and deliver a tabbed binder of the logged documents to the magistrate judge for in camera review. (Disclosure: Kantor & Kantor represents Collier in this action.)

Pension Benefit Claims

Seventh Circuit

Dumke v. Chicago & Vicinity Laborers’ Dist. Council Pension Fund, No. 25-C-50328, 2026 WL 3135028 (N.D. Ill. Oct. 20, 2026) (Judge Rebecca R. Pallmeyer). In this action Kristen Dumke has sued to enforce a divorce agreement that granted her a share of her former husband Jeffrey Dumke’s pension benefits. The Chicago & Vicinity Laborers’ District Council Pension Fund determined that she was not entitled to them because she never submitted a domestic relations order (DRO) before Jeffrey died, and thus full survivorship benefits vested in his widow, Elizabeth Fischer. Because those benefits had already vested, the Fund reasoned, the DRO Kristen submitted afterward could not constitute a qualified domestic relations order (QDRO) under ERISA entitling her to part of Jeffrey’s pension. The Fund set the annuity start date for Fischer’s benefit “just days” after it was on notice that Kristen was actively seeking to cure the deficiencies in her DRO, and it had pre-death notice of the divorce. On cross-motions for summary judgment, the court granted Kristen’s motion and denied the Fund’s earlier this year. (We covered this decision in our July 15, 2026, edition.) Because that ruling rested in part on arguments the parties had not raised, the court did not immediately enter judgment and instead invited them to “identify errors in the court’s reasoning.” The Fund responded by seeking reconsideration on three grounds: (1) that the court’s distinction between qualified joint and survivor annuities (QJSAs) and qualified pre-retirement survivor annuities (QPSAs) was contrary to law, (2) that it had confused the QDRO processing rules with the vesting provisions and created an unworkable “notice” standard, and (3) that the Second Circuit’s decision in Yale-New Haven Hospital v. Nicholls, on which the court relied, was incorrectly decided. On the first issue, the court explained that a QPSA is paid to a surviving spouse when a participant dies before commencing benefits, while a QJSA is paid after a participant dies in retirement. Elizabeth’s interest was a QPSA. The Fund argued that because QJSA benefits vest at retirement, QPSA benefits must vest at death. But Nicholls held that a surviving spouse “did not gain an automatic and irrevocable interest in [her ex-husband’s] plan benefits on the date of his death,” and a Ninth Circuit case (Carmona v. Carmona) similarly held that “so long as a valid DRO creates an alternate payee’s legally enforceable property interest in QPSA benefits, a QDRO can be obtained even after the plan participant’s death.” The court found these authorities persuasive, and thus ruled that Fischer’s QPSA interest did not vest at Jeffrey’s death. On the second issue, the Fund argued that ERISA’s segregation requirement, 29 U.S.C. § 1056(d)(3)(H), is triggered only by receipt of an entered order. However, the Fund did not cite any authorities on point, and a Ninth Circuit case (Trs. of the Dirs. Guild of Am.-Producer Pension Benefits Plans v. Tise) had recognized that Congress “expressly contemplated that further state court proceedings might ensue during the 18-month QDRO-determination period” to cure defects in the original DRO. This opportunity “implicitly accounts for situations like Kristen’s” and implies that notice of an order, even an unperfected one, suffices to trigger segregation. The Fund’s claim that no case allowed post-vesting notice to divest a surviving spouse disregarded the court’s finding that Elizabeth’s interest could not vest until the plan determined the DRO’s qualified status. Nor was the court’s reading “unworkable for plan administration,” because Congress intentionally balanced administrative ease against its interest in “mitigat[ing] the impact of divorce upon children and former spouses.” Finally, the court maintained its reliance on Nicholls. The Fund argued that nunc pro tunc orders would require reannuitization, a benefit “not otherwise provided under the plan” that disqualifies a DRO. However, that argument assumed that the annuity start date for QPSA benefits must be tied to the participant’s death, which the court had already stated it did not accept. The court reiterated its earlier conclusion that any need to reannuitize was a result of the Fund’s failure to account for Kristen’s DRO despite being on notice of it, and that it was “unwilling to approve a result that penalizes Kristen for the Fund’s apparent mistake.” As a result, the court’s summary judgment ruling remained unchanged. It ordered the Fund to qualify Kristen’s DRO and, within 30 days, remit to her the benefits to which she is entitled.

Pleading Issues & Procedure

Sixth Circuit

Patterson v. Swagelok Co., No. 1:20-cv-566, and Patterson v. UnitedHealth Group, Inc., No. 1:21-cv-470, 2026 WL 3126888 (N.D. Ohio Oct. 20, 2026) (Judge J. Philip Calabrese). These two long-running cases, which have been up to the Sixth Circuit twice, are likely familiar to devoted Your ERISA Watch readers. They involve a married couple who have asserted state and federal claims against various United Healthcare entities arising from separate automobile accidents. (For more background on this complicated case, see our December 10, 2025, edition.) The cases center on whether defendants were entitled to subrogation and reimbursement from the settlements that occurred after the accidents. After the latest trip to the Sixth Circuit, the district court granted in part and denied in part defendants’ motion to dismiss. That ruling addressed “at length the standing of each Plaintiff[.]” (We covered this order in our January 14, 2026, edition.) In July the court overruled the defendants’ objections to a single interrogatory seeking information about persons similarly situated to plaintiffs, and in August it denied reconsideration. At issue now is defendants’ motion asking the court to certify its August order for interlocutory appeal under 28 U.S.C. § 1292(b). As the court put it, “To try to side step the obvious deficiencies with appealing a discovery ruling, Defendants seek to frame the Court’s Order as one of standing.” The court began its discussion by correcting what it called “misstatements of the record.” Defendants asserted that the court had already held that Eric Patterson is not entitled to broader relief than the $25,000 reimbursed to the plan from his third-party settlement and cannot maintain claims on behalf of the plan. The court had indeed ruled that he could not maintain claims on behalf of the plan, but it had expressly considered whether he might maintain his ERISA claims on behalf of a class and concluded that the Sixth Circuit did not reach that question. The ruling challenged by defendants did not address that question either. Instead, it “concerns only the discoverability of information regarding others who might have similar claims. Such information is generally and routinely discoverable. Whether it is admissible is another matter, as is whether such information may support claims on behalf of a class. In any event, the discovery sought and ordered does not bear on standing.” The court also clarified that its January ruling did not hold that Patterson lacked standing to proceed on behalf of a class. The court had said only that it “will not reconsider Mr. Patterson’s standing to maintain a claim on behalf of the Plan or to any other claim”; standing and the ability to bring class claims “are two separate things.” Defendants, the court said, “continue to confuse” the claims Patterson may bring on his own behalf and on behalf of the plan with whether he may maintain his claims on behalf of a class. The court thus maintained that, “[a]t this stage of the proceedings, the amended complaint makes the discovery proper, and the discovery sought might or might not support claims on behalf of a class. Any such determination is for another day.” The court finished its introduction with two more points. First, “Defendants put their cards on the table and show the real issue they have. They want to bring a motion for sanctions against Plaintiffs.” The court stated that it would resolve claims and defenses on their merits rather than “through collateral litigation about attorney conduct and motions for sanctions.” Indeed, the court warned defendants that “if [their] position is that they intend to deny the existence of similarly situated individuals in discovery, notwithstanding the fact that such persons appear to exist, such conduct might merit a motion for sanctions. But it does not merit interlocutory review.” Second, defendants invoked the policies behind interlocutory appeals, but “they do so without taking the procedural step necessary to avail themselves of that appeal – proceeding through class certification proceedings. Indeed, Defendants have done everything in their power to delay and avoid such proceedings.” Turning to the requirements for interlocutory review under § 1292(b), the court applied the Sixth Circuit’s three-part test of In re City of Memphis, i.e., asking whether (1) there is a controlling question of law, (2) there exists substantial ground for difference of opinion, and (3) an appeal would materially advance the litigation’s termination. Certification is granted sparingly and only in exceptional cases, and the court called the order defendants sought to appeal “a run-of-the-mill discovery ruling. Nothing more, nothing less.” Defendants pointed to Article III standing as the controlling question, but the Sixth Circuit had already held that Eric Patterson has standing, and the actual question was whether the amended complaint entitles the plaintiffs to discovery about similarly situated persons, which is not a controlling question of law. Even if the first element were met, interlocutory review would not materially advance the litigation. With or without class proceedings, the parties must still go through discovery, dispositive motions, and trial, and given “heated proceedings between the parties that have spanned more than a decade,” the court saw no reason to expect an appellate ruling on a discovery dispute to advance the end of the case. In the end, “Defendants’ motion fails to meet the standard for certifying an interlocutory appeal. And the question is not even close.”

Ninth Circuit

Ouimet v. Engage3 Holdings, No. 2:26-cv-3560 DAD AC (PS), 2026 WL 3206088 (E.D. Cal. Oct. 26, 2026) (Magistrate Judge Allison Claire). Kenneth Joseph Ouimet, proceeding pro se, filed this action alleging ERISA claims against Engage3 Holdings, Inc. and other defendants and moved for a temporary restraining order. The motion asked the court to order Engage3 to produce “plan instruments, preserve administrative records, and transmit the produced governing documents to Mutual of Omaha Insurance Company” so that he could pursue long-term disability benefits. Ouimet argued that his “immediate injury is procedural and informational” because he could not know or satisfy the plan’s claim requirements, evaluate deadlines and limitations provisions, or present his claim “under the actual contract while governing instruments remain withheld.” The district judge referred the motion to the magistrate judge, who recommended that the motion be denied. Emergency relief without notice to the adverse party is available only where the movant “clearly show[s] that immediate and irreparable injury, loss, or damage will result to the movant before the adverse party can be heard in opposition,” and the court’s local rules provide that “[e]xcept in the most extraordinary of circumstances, no temporary restraining order shall be granted in the absence of actual notice to the affected party and/or counsel.” Finding no such circumstances, the court construed the motion as one for a preliminary injunction, which has a less onerous showing, i.e., that the movant is likely to succeed on the merits, is likely to suffer irreparable harm absent relief, that the balance of equities tips in his favor, and that an injunction is in the public interest. The motion failed first on irreparable harm. The court observed that the motion “reads more as a request for discovery than for a temporary restraining order.” Ouimet’s assertion that later monetary damages could not compensate for the harm of non-production was conclusory and unexplained, and the court was “unpersuaded that any harm would indeed be irreparable.” His motion did not present circumstances warranting emergency relief. As an independent basis for denial, the court held that Ouimet could not show a likelihood of success on the merits. In a separate order issued the same day, the magistrate judge screened the complaint and found that it did not comply with Rule 8, so that the court could not determine whether it presented any legally sufficient claim, and gave Ouimet leave to file an amended complaint. Because “there is currently no complaint before the court which states cognizable claims,” he could not establish a likelihood of success. The magistrate judge thus recommended that Ouimet’s emergency motion be denied.

Provider Claims

Fourth Circuit

Mercy Med. Ctr., Inc. v. Fidelis Software Solutions, LLC, No. 26-292-BAH, 2026 WL 3205754 (D. Md. Oct. 26, 2026) (Judge Brendan A. Hurson). Mercy Medical Center, Inc. sued Fidelis Software Solutions, LLC and Planned Administrators, Inc. (PAI) in state court for breach of contract, alleging that they failed to pay for inpatient care of a Fidelis health plan beneficiary at the rates set by the Maryland Health Services Cost Review Commission (MHSCRC). Fidelis provides health insurance to its employees, and PAI is the claims administrator for the Fidelis plan. PAI removed the case to federal court and moved to dismiss. In a July 30, 2026, decision, the court granted the motion for failure to state a breach of contract claim and directed Mercy to move for any relief related to service within fourteen days. (Fidelis had never been served.) (Your ERISA Watch covered this ruling in our August 5, 2026, edition.) Thirteen days later, Mercy moved to amend its complaint and to extend the time for service on Fidelis. Its proposed amended complaint abandoned the contract theory in favor of three counts: declaratory judgment (Count I), benefits under 29 U.S.C. § 1132(a) (Count II), and breach of fiduciary duty under § 1132(a)(3) (Count III). The court noted that because the motion sought post-judgment amendment, Mercy technically could not request leave to amend unless the court first vacated its judgment under Rule 59(e) or 60(b). Mercy had not asked for that relief, but because the court’s earlier opinion had signaled a willingness to consider amendment, the court liberally construed the motion to include it, citing a preference for “resolving cases on the merits, instead of on technicalities.” Regarding Mercy’s proposed amendments against PAI, the court agreed with PAI that they were futile. Each proposed count rested on the same assumption that defendants were contractually obliged to reimburse Mercy at MHSCRC rates, but, as the court explained in its prior order, the Commission sets hospital rates and “is not the source of any independent contractual obligation between provider, beneficiary, or plan.” Mercy still identified no authority that the Commission’s rate-setting function creates a contractual obligation among third parties, and it did not allege that the Fidelis plan itself sets reimbursement at MHSCRC levels. Because the amendments did not adequately respond to the court’s stated concerns, leave to amend as to PAI was denied. As for Fidelis, it and PAI are “differently situated in terms of their legal relationship to Mercy,” and PAI itself noted that its service agreement gives Fidelis, not PAI, final authority over plan interpretation and benefit payments and describes PAI’s duties as ministerial and non-fiduciary. Because this was Mercy’s first proposed amendment, and Fidelis had suffered no prejudice because it had not yet been served, the court granted leave to amend as to Fidelis. Finally, the court addressed Mercy’s motion to extend time for service regarding Fidelis. Mercy’s present counsel joined the case two days after PAI moved to dismiss, before the service deadline, and delayed serving because he believed that serving Fidelis “was inappropriate and would only run up their costs.” The court did not consider this to be good cause, but found that Mercy had acted in good faith by moving within the fourteen days the court allowed, had not sought a prior extension, requested only ten days, and the case was at an early stage. As a result, PAI remains dismissed, leave to amend as to Fidelis was granted, and Mercy was directed to file an updated amended complaint naming Fidelis as the sole defendant and to effect service on Fidelis within ten days of the date of the decision.

Remedies

Sixth Circuit

Williamson v. Lunar, No. 25-5790, __ F. App’x __, 2026 WL 3153191 (6th Cir. Oct. 21, 2026) (Before Circuit Judges Kethledge, Cole, and Mathis). In 2013, Larry Henning and three others left Charleston, South Carolina on a fishing vessel that shipwrecked off the coast of Florida. The Coast Guard found debris from the boat, but despite a multi-day search by the Coast Guard and the Florida Fish and Wildlife Conservation Commission, Henning’s body was never found. The Coast Guard told Henning’s estate that it was not authorized to issue a Letter of Presumed Death and instead issued a report stating that “Mr. Henning remains missing.” Henning was covered by an ERISA-governed accidental death policy issued by Life Insurance Company of North America (LINA) to American Maritime Officers Plans (AMOP). After plaintiff Robert Williamson was appointed curator of Henning’s estate in 2014, a woman named Ana Maria Lunar, who purported to be Henning’s widow, began communicating with the estate, the Coast Guard, and AMOP about claiming the benefits. AMOP rejected the marriage certificate she submitted, which was later determined to be forged. Two years later, the estate emailed AMOP to claim “any life insurance benefits that may become payable to the estate,” and AMOP forwarded the claim to LINA. LINA responded that it required “[a] finalized death certificate,” and when it did not receive one, closed the claim. The estate sued LINA, AMOP, and Lunar in 2018. Eventually, the claims against AMOP and Lunar were resolved, and only LINA remained. After a death certificate was finally issued, LINA ultimately paid benefits under the policy. The only remaining issue, then, was whether LINA was also required to pay interest on the benefits, and if so, whether attorney’s fees should also be awarded. The district court held that LINA did not abuse its discretion in requiring a death certificate, the policy did not require LINA to investigate Henning’s death further, and LINA had not breached the policy. It thus concluded that the estate was entitled to neither prejudgment interest nor attorney’s fees and granted LINA summary judgment. (Your ERISA Watch covered this ruling in our January 29, 2025, edition.) The estate appealed, arguing first that the district court improperly applied an arbitrary and capricious standard in deciding prejudgment interest, and alternatively that LINA wrongly withheld benefits even under that standard. On the first issue, the court held that the district court correctly used the arbitrary and capricious standard in deciding whether LINA wrongfully withheld benefits, because the policy conferred discretion. It required “[w]ritten or electronic proof of loss satisfactory to Us,” language that qualified as a grant of discretion under Sixth Circuit precedent in Perez v. Aetna Life Insurance Co. The appellate court ruled that the district court had applied that standard only to LINA’s proof-of-loss decisions and its demand for a death certificate, not directly to the interest question, and its conclusion that no interest was owed “correctly flowed from its finding that LINA had discretion as to when to pay the claim.” The estate responded that Perez was incorrectly decided, but “this panel has no power to overrule Perez” because in the Sixth Circuit a published opinion can be overruled only by an en banc court. As for the merits of the district court’s decision, the estate argued that LINA should have approved the claim at the outset because it had sufficient evidence to conclude that Henning was dead without a death certificate, or, at a minimum, LINA should have investigated the claim further. However, the Sixth Circuit concluded that LINA had no obligation to investigate because its policy placed the burden of providing satisfactory proof on the insured. Given the complexities of the claim, including the lack of a death certificate, the district court appropriately determined that the estate was not entitled to the benefits earlier than it received them, and because the benefits were received in a timely fashion, no interest was owed. As a result, the Sixth Circuit affirmed, holding that the district court did not abuse its discretion in denying prejudgment interest and attorney’s fees. (Disclosure: Kantor & Kantor represented the estate on appeal in this action.)

Retaliation Claims

Fourth Circuit

Callahan v. Carolina Veterinary Services PC, No. 1:26-CV-375, 2026 WL 3173688 (M.D.N.C. Oct. 23, 2026) (Judge Catherine C. Eagles). Brooke Callahan alleges in this action that she was fired while her disability accommodation request was pending. She began work as a receptionist for the two defendants, Carolina Veterinary Services PC and AVG of North Carolina LLC, in March 2025. In May 2025 she needed medical attention for polycystic ovarian syndrome and asked about the policy on missing work for medical reasons, and an assistant manager replied that “if you’re sick, you’re sick,” later declining her doctor’s note because “the company does not accept doctor’s notes.” After a manager directed her to the company’s third-party accommodations administrator, The Hartford, she was approved for personal leave from June 16 to July 18, 2025, while her accommodation request was pending. On June 24, before Hartford had made any decision, the human resources manager called and suggested that she resign because he did not think she would qualify for accommodations. On July 3 he told her that the request had been denied, her position had been filled, and her employer health insurance had ended effective July 1, and he later explained that the request was denied because she “went out on leave 60 days into her employment.” In her complaint Callahan asserted disability discrimination and retaliation under the ADA, wrongful discharge in violation of North Carolina public policy, and ERISA retaliation. Defendants moved to dismiss her amended complaint as an improper shotgun pleading and for failure to exhaust and to state a claim. In this order the court agreed the complaint was a shotgun pleading. Callahan did not specify who did what, which claim ran against which defendant, or even which defendant hired her. Facts offered in her response brief could not cure the problem, because “parties cannot amend their complaints through briefing or oral advocacy.” In an effort to avoid another round of briefing, the court addressed defendants’ other arguments. It ruled that Callahan failed to exhaust her ADA claim against Carolina Veterinary Services for failure to exhaust, because the EEOC charge named only AVG as her employer. On the merits, the court found the ADA claims largely plausible. Callahan properly alleged a disability, satisfactory performance, and termination while her request was pending, with the human resources manager’s comments supporting an inference of unlawful discrimination. Defendants’ argument that she did not allege that a “relevant decisionmaker” knew of her disability failed because she alleged that she told management, an assistant manager, the practice manager, Hartford, and the human resources manager. The ADA retaliation claim also survived because requesting an accommodation is protected activity, the timing and remarks supported causation, and it was reasonably related to the EEOC charge. However, the court held that any claim based on a failure to accommodate was not plausible because “it is not clear what accommodations she sought or what accommodations were denied.” The wrongful discharge claim failed because North Carolina’s narrow public policy exception requires an allegation that the defendant violated “an explicit statutory or constitutional provision,” and Callahan identified none in her complaint. Finally, Callahan’s ERISA retaliation claim under 29 U.S.C. § 1140 was also dismissed. She alleged only that her employer offered an ERISA health plan, ended her coverage, and sent a COBRA email, which were “minimal facts” that did not support an inference that she was exercising an ERISA right or was fired to interfere with one. Her complaint linked the loss of coverage to her request for disability leave and accommodations, not to any right under ERISA. As a result, defendants’ motion to dismiss was granted, but the court granted Callahan leave to amend.

Subrogation/Reimbursement Claims

Seventh Circuit

Central States Southeast & Southwest Areas Pension Fund v. Abraham, No. 26 CV 1827, 2026 WL 3181203 (N.D. Ill. Oct. 23, 2026) (Judge Jeremy C. Daniel). In this action Central States Southeast and Southwest Areas Pension Fund sued Margaret Abraham to recover an alleged overpayment of pension benefits. According to Central States, Stanley Jarecki, a Fund participant, died in 2017, but the Fund continued paying monthly benefits into his bank account through May 2021 in the total amount of $24,892. The Fund did not learn of his death until 2023. When the Fund sent a demand for payment to the bank, the bank explained that it could not return any funds because the account had been closed. The Fund argues that Abraham controlled the account, knew the Fund was still making deposits, and concealed Jarecki’s death. In its complaint it asserted breach of fiduciary duty under ERISA §§ 502(a)(2) and (a)(3) (Counts I and II), an equitable lien and constructive trust under § 502(a)(3) (Count III), and common law fraud (Count IV). Abraham moved to dismiss for failure to state a claim. On the fiduciary duty counts, the Fund’s theory was that Abraham is a fiduciary because she possesses the mistakenly paid benefits, which they contend remain Fund assets. The court held that this “does not pass muster” as a threshold matter because the complaint pleaded no facts showing that she “has the money.” It alleged only that the Fund deposited benefits into Jarecki’s account after his death and that the account was closed by the time the Fund contacted the bank. The complaint “pleads no facts that connect Jarecki, his bank account, or the mistaken payments” to Abraham. Because the complaint did not plausibly allege that Abraham was in possession of the overpaid benefits, the Fund could not establish that she was a fiduciary and thus the first two counts failed. Count III failed for a similar reason. An equitable lien requires a debt or obligation owed by the defendant and a res “particularly related to the debt or obligation.” Likewise, a constructive trust requires proceeds that exist as “an identifiable fund traceable to” the wrongful conduct. The plaintiffs identified the $24,892 as the res, but the complaint did not connect that money to Abraham, and “[t]he whereabouts of the money since then are unpled.” Without an identifiable asset or fund, the claim could not proceed, and Count III was dismissed without prejudice. Because the ERISA claims were dismissed, the court declined to exercise supplemental jurisdiction over the state law fraud claim in Count IV and dismissed it without prejudice. As a result, Abraham’s motion to dismiss was granted, albeit without prejudice.