Cogdell v. Reliance Standard Life Ins. Co., No. 24-1940, __ F.4th __, 2026 WL 588427 (4th Cir. Mar. 3, 2026) (Before Circuit Judges Agee, Quattlebaum, and Floyd)
ERISA requires benefit plan administrators to give participants a “full and fair review” when they challenge the denials of their claims. 29 U.S.C. § 1133. However, the statutory scheme does not provide any details as to what such a review should include.
Instead, Congress passed the buck to the Department of Labor, which promulgated 29 C.F.R. § 2560.503-1, titled “Claims procedure.” This regulation extensively sets forth requirements and time limits that apply to claims, appeals, and determinations on both.
In 2018, the Department of Labor amended the regulation to tighten the screws on disability benefit plan administrators. The amendment requires “strict adherence” to the regulation, and provides that if an administrator does not strictly adhere, e.g. by missing a deadline, “the claimant is deemed to have exhausted the administrative remedies available under the plan” and is entitled to file suit in federal court. Furthermore, “the claim…is deemed denied on review without the exercise of discretion by an appropriate fiduciary.”
So, what happens if a benefit plan gives the fiduciary discretionary authority to make benefit determinations? Ordinarily this would result in a deferential “abuse of discretion” or “arbitrary and capricious” standard of review by the court. But, if the fiduciary misses a regulatory deadline, does the absence of exercise of discretion mandated by the regulation mean that that the fiduciary is no longer entitled to deferential review? The Fourth Circuit addressed this issue in this week’s notable decision.
The plaintiff was Heather Cogdell, who was employed at MITRE Corporation as a principal business process engineer. In 2021, she contracted COVID-19 and suffered long-COVID symptoms such as intense fatigue and sporadic headaches. As a result, Cogdell took a medical leave, during which she worked part-time.
As she was recovering, in 2022, she contracted COVID again. This time she could not return to work, so she submitted a claim for benefits under MITRE’s ERISA-governed employee long-term disability benefit plan, which was insured and administered by Reliance Standard Life Insurance Company.
Reliance denied Cogdell’s claim, contending that she did not meet the insuring policy’s definition of “totally disabled.” Cogdell submitted additional medical records, but Reliance reaffirmed its decision.
Cogdell filed an appeal on August 15, 2023, which started a 45-day clock for Reliance under ERISA’s claims procedure regulation. This meant Reliance had to make a benefit determination by September 29, 2023.
However, it did not refer the case to its appeals department until September 11, 2023, and on September 25, 2023, Reliance informed Cogdell that it wanted to conduct an independent medical review of her claim, and thus it needed more than 45 days to make a final decision. Reliance did not inform Cogdell when it expected to make a final determination, nor did it invoke any “special circumstances,” as required by the regulation, to justify its claimed extension.
When the original 45-day deadline expired, Cogdell brought this action alleging wrongful denial of benefits under 29 U.S.C. § 1132(a)(1)(B). On October 26, 2023, 72 days after Cogdell appealed, Reliance upheld its decision denying her claim.
On cross-motions for judgment on the administrative record, the district court ruled in favor of Cogdell. Reliance argued that the policy gave it discretionary authority to make benefit determinations, and thus the court should use the abuse of discretion standard of review. The court rejected this argument, concluding that because Reliance did not timely decide Cogdell’s appeal, it had forfeited any deference from the court. The court then made findings of fact and conclusions of law, determining that under de novo review Cogdell was entitled to benefits. (This decision was Your ERISA Watch’s case of the week in our September 18, 2024 edition.)
Reliance appealed, and as the Fourth Circuit put it, “[t]he standard of review takes center stage[.]” This issue required a two-step analysis. First, the court addressed “whether Reliance timely decided Cogdell’s internal appeal as required by the applicable ERISA regulations and the Plan.”
Reliance acknowledged that it did not issue a decision by the initial 45-day deadline, but argued that it properly invoked the 45-day “special circumstances” extension allowed for by the regulation, which was necessary because it needed time to review Cogdell’s appeal and was seeking an independent medical report. As the Fourth Circuit put it, Reliance’s argument was that “in its view, so long as a plan administrator determines special circumstances exist, that finding in and of itself is sufficient.”
The court disagreed. It noted that Reliance did not inform Cogdell that its extended review “was a special circumstance, nor did it explain how it could be one.” Furthermore, although the regulation “do[es] not define ‘special circumstances,’ giving little guidance as to what it means,” the plain meaning of the word “special” indicated something “out of the ordinary” or “unusual.” However, “a circumstance is not ‘special’ if it is commonplace in the appeals process.” The court observed that the activities of reviewing medical records and scheduling an independent medical report are “routine,” “commonplace – and often required – in the internal appeal process.”
The court also faulted Reliance because “[t]he record…reveals that Reliance’s failure to complete its review within 45 days was completely of its own making,” citing the delay in assigning the appeal to the appropriate department. Indeed, the court noted that once the gears started turning in that department, Reliance was able to render a decision in 36 days. Thus, “Reliance could have completed its review of Cogdell’s internal appeal well within the initial 45 days. And, if it could not have, it provided no valid reason for failing to do so.”
The Fourth Circuit then turned to the issue of what consequences Reliance should face for its non-compliance. The court noted the two immediate results compelled by the regulation: (1) Cogdell was “deemed to have exhausted the administrative remedies available under the plan,” and (2) “the claim or appeal is deemed denied on review without the exercise of discretion by an appropriate fiduciary.”
Reliance conceded the first consequence, but argued that the second should not affect the applicable standard of review for two reasons. First, Reliance contended that it did in fact decide Cogdell’s appeal, even if it was late, and thus this case was “different from those that have held that a plan administrator forfeits discretionary review when it simply fails to decide an internal appeal.” The Fourth Circuit characterized this as “a substantial compliance argument… No harm, no foul?”
Unfortunately for Reliance, “We think not.” The court acknowledged that it had applied the substantial compliance doctrine in reviewing certain other procedural defects in claim administration, “[b]ut we have not located, and Reliance has not cited, a single case where we have applied the substantial compliance doctrine to the failure to observe the affirmative requirements of ERISA’s timing regulations or the provisions of the Plan.”
Furthermore, the court declined to apply it in the first instance here, holding that “failure to follow the Plan’s time restraints negates the discretion that would otherwise be due[.]” In short, “[d]ecisions made outside the boundaries of conferred discretion are not exercises of discretion[.]” The court approvingly cited then-Judge Amy Coney Barrett’s 2019 Seventh Circuit decision in Fessenden v. Reliance Standard Life Ins. Co. (which we covered as the case of the week in our June 26, 2019 edition) for the proposition that “the substantial compliance doctrine is incompatible with the applicable ERISA time restraints.”
Reliance’s second argument for retaining discretion was that the 2018 amendment to the regulation “was an impermissible exercise of the Secretary’s rulemaking authority” under the Supreme Court’s 2024 blockbuster decision in Loper Bright v. Raimondo. Reliance contended that the amendment “sets forth the judicial consequences of a fiduciary’s failure to follow the procedures by specifically revoking discretion” even though “ERISA does not grant the Secretary the authority to do so.”
This argument went nowhere with the district court, and was equally unsuccessful with the Fourth Circuit. The court stated that the standard of review did not flow from the regulation “but by [Supreme Court precedent] and the principles of trust law we must consider when determining the appropriate standard of review.” The regulation “simply says that a certain set of circumstances leads to a certain result. It does not, however, invade the role of courts in setting the standard of review.”
Finally, the court arrived at the merits of the case. Reliance argued that (1) “the district court erroneously evaluated Cogdell’s claim based on her specific job at MITRE rather than the duties of her ‘regular occupation,’” as required by the policy, (2) “the district court erred by not considering the reports from the two independent medical professionals that Reliance received after Cogdell’s claim was deemed denied and she filed suit,” and (3) “the district court impermissibly applied a ‘treating physician’ rule, assigning more weight to certain reports from Cogdell’s treating physicians.”
The Fourth Circuit rejected all three arguments. First, the court ruled that the district court “reasonably identified Cogdell’s occupation and its associated duties” by looking to her job description and other evidence in the record. The district court was also allowed to give the Dictionary of Occupational Titles entry for “Consultant,” used by Reliance, little weight because “many of the broad tasks it listed do not ‘involve comparable duties’ to the work Cogdell performed in her role at MITRE.” Furthermore, the sedentary nature of Cogdell’s job was insufficient to show that she could return to work because this “leaves out any consideration of the cognitive requirements of Cogdell’s occupation[.]”
Second, the Fourth Circuit upheld the district court’s decision not to look at Reliance’s late medical reports. “We see no abuse of discretion in the district court’s decision not to consider evidence that the claims processing regulations required be provided to Cogdell with an opportunity to respond within the appeals period because the evidence was not provided until after the claim was deemed denied, leaving Cogdell with no opportunity to respond.”
Finally, although the Fourth Circuit agreed with Reliance that there is no “treating physician” rule in ERISA benefit cases, it was still the district court’s institutional role to act as a finder of fact, “and that role encompasses ‘assessing credibility and determining the appropriate weight to assign evidence.’” Here, the district court gave more weight to Cogdell’s physicians, and “[a]lthough Reliance may dispute the weight of the evidence, given the district court’s extensive review of the record evidence that supports its conclusion that Cogdell was ‘Totally Disabled,’ Reliance has failed to show anything that would leave this Court ‘with the definite and firm conviction that a mistake has been committed.’”
As a result, the Fourth Circuit affirmed the judgment in Cogdell’s favor in its entirety.
Below is a summary of this past week’s notable ERISA decisions by subject matter and jurisdiction.
Arbitration
Ninth Circuit
Dixon v. MultiCare Health System, No. CV25-5414, 2026 WL 607769 (W.D. Wash. Mar. 4, 2026) (Judge Benjamin H. Settle). Ryan Adam Dixon was hired as a registered nurse at MultiCare Good Samaritan Hospital in 2023. He alleges that during his onboarding, an incorrect Social Security number and his nickname were used to set up his employment records and 401(k) retirement account. Dixon contends that as a result he was unable to access the employee portal to stop his 401(k) contributions, which eventually totaled $1,317.25. His request for a refund was denied, so he filed this action pro se, asserting claims under ERISA for recovery of benefit and breach of fiduciary duty, willful withholding of wages under Washington state law (RCW 49.52.070), and unlawful retaliation under ERISA. The parties filed several motions, including MultiCare’s motion to dismiss and Dixon’s motion to compel plan documents. MultiCare argued for dismissal on the grounds that Dixon failed to exhaust administrative review procedures and that his claims were subject to arbitration. It also contended that Dixon’s state law claim was preempted by ERISA and that he failed to allege a specific retaliatory act. The court addressed Dixon’s ERISA claims first, ruling that they were subject to the plan’s mandatory arbitration provision. The court found that the arbitration provision was enforceable and Dixon’s claims were within its scope, rejecting Dixon’s argument that it was unenforceable because it “eliminates plan-wide relief.” The court noted that Dixon was not representing others and that the arbitration provision in fact preserved all his rights. The court further rejected Dixon’s argument that MultiCare had waived its right to invoke arbitration, noting that MultiCare raised the issue at its first opportunity. The court thus granted MultiCare’s motion to compel arbitration and stayed Dixon’s ERISA claims. As for Dixon’s state law withholding claim, the court agreed with MultiCare that it was preempted by ERISA. The court ruled that the claim related to an ERISA-governed employee benefit plan, as the alleged liability arose from Dixon’s automatic enrollment in MultiCare’s 401(k) plan. As a result, this claim was dismissed with prejudice. Dixon’s retaliation claim under ERISA Section 510 was also dismissed because it was based on allegations that MultiCare might take adverse action against him in the future; the court agreed with MultiCare that potential future claims are not actionable. This dismissal was without prejudice. The court then turned to Dixon’s motion to compel production of documents. The court ruled that (a) MultiCare had produced all statutorily required documents, (b) MultiCare was not required to produce other documents requested by Dixon, and (c) Dixon failed to meet and confer under the court’s local rules before filing his motion. Finally, the court admonished Dixon because he “repeatedly cites to nonexistent cases and to other cases that do not support the proposition for which they were offered.” The court warned Dixon that this conduct, if it continued, could lead to monetary sanctions. Thus, the case will go to arbitration, and the parties’ other motions were denied as moot.
Attorneys’ Fees
Tenth Circuit
J.H. v. United Behavioral Health, No. 2:23-CV-00190-JNP-CMR, 2026 WL 632244 (D. Utah Mar. 6, 2026) (Judge Jill N. Parrish). In June of 2025 the district court granted plaintiffs’ motion for summary judgment, and denied defendants’, in this case involving United Behavioral Health’s denial of benefits for treatment of mental health and substance abuse. (Your ERISA Watch reported on this decision in our June 25, 2025 edition.) In so doing, the court ruled, “the record establishes that United’s decision to deny benefits was arbitrary and capricious. United failed to engage in anything resembling a meaningful dialogue in explaining its decisions, and no reasonable beneficiary in J.H.’s shoes could have been expected to understand its reasoning or decision-making process from its appeal-decision letters.” The court remanded the case to United for further consideration, and plaintiffs filed a motion for attorney’s fees, which the court ruled on in this order. The court noted that ordinarily it must consider whether plaintiffs achieved “some degree of success on the merits,” and then use the Tenth Circuit’s five-factor test, to determine whether fees should be awarded. However, “Here, Plaintiffs clearly achieved some level of success on the merits… Defendants also do not seriously dispute that attorney’s fees are available.” As a result, the court focused on the reasonableness of plaintiffs’ request. The court used the hybrid lodestar method to determine the appropriate amount, which involves multiplying the number of hours reasonably expended by a reasonable hourly rate. The parties agreed that plaintiffs’ counsel’s hours were reasonable, but they differed as to the appropriate hourly rates to be applied to that time. Plaintiffs’ counsel argued for a “national rate” in awarding fees, contending that “ERISA litigation is sufficiently specialized such that there ‘may be no local community of comparable lawyers from which to draw hourly rates for comparison.’” The court disagreed, noting that there were other ERISA practitioners in Utah, and that ERISA was not an unusual enough area of law to justify awarding a national rate. Thus, the court “looks to the prevailing rates in the community to determine reasonable hourly rates, with the relevant community being the Salt Lake City market.” Brian S. King requested $650 per hour, and the court agreed that “Mr. King has an exceptional, perhaps unparalleled depth of experience and skill in ERISA cases in this District. He has been exclusively handling ERISA cases for nearly thirty years, has lectured on various aspects of ERISA, and has testified before the Department of Labor twice on proposed changes to ERISA.” The court acknowledged that “no other court has yet found a rate of $650 per hour to be reasonable for Mr. King,” but other courts had awarded $600 per hour, and he had not raised his rates since 2021, so the court agreed $650 was reasonable. However, the court reduced the hourly rates for two other attorneys at Mr. King’s firm, from $400 to $300 for Samuel Hall, and from $300 to $250 for Andrew Somers. As a result, while plaintiffs requested $51,170, the court ultimately awarded $46,435, in addition to the undisputed $400 in incurred costs.
Breach of Fiduciary Duty
Second Circuit
Hammell v. Pilot Products, Inc. Defined Benefit Pension Plan, No. 24-3283-CV, __ F. App’x __, 2026 WL 586699 (2d Cir. Mar. 3, 2026) (Before Circuit Judges Bianco, Pérez, and Kahn). This case is a dispute between family members over the management of the pension plan for the family-owned business Pilot Products, Inc. The company was founded by husband and wife Herbert and Marcia Hebel. When Herbert died in 2011, the family litigated over control of the company, and in 2014 they agreed that Marcia and one of the couple’s daughters, Elizabeth, would resign and sell their shares to the other daughter, Carolyn, who became the sole officer, shareholder, and trustee of the pension plan. Carolyn began terminating the plan in 2018, but it was underfunded by $1.5 million, and thus she demanded that Elizabeth and Marcia contribute “to correct the underfunding.” In the same letter Carolyn also informed them that benefits could be distributed in a lump sum, but did not explain the financial implications of doing so. During the back-and-forth between the two sides about these issues, Marcia died in 2020 without completing the lump-sum election forms, resulting in a final distribution to her estate that was far less than she could have received in a lump-sum amount. Carolyn later distributed additional plan funds to herself. Elizabeth, on her own behalf and on behalf of Marcia’s estate, filed this action alleging breaches of the fiduciary duties of care and loyalty under ERISA, and a conversion claim under New York law. After a three-day bench trial, the district court found Carolyn liable for breaching her fiduciary duty of care by failing to provide proper notice of Marcia’s right to elect a lump-sum payment. The court awarded $1.78 million in damages, plus interest, amounting to the difference between the hypothetical lump sum and the amount Marcia’s estate actually received. (The court also awarded Elizabeth more than $1 million in attorney’s fees). The court found in favor of Carolyn on the remaining claims, determining that the conversion claims were preempted by ERISA and that Elizabeth failed to prove a breach of the fiduciary duty of loyalty. Both sides appealed. Carolyn argued that Elizabeth did not have standing, relying on the Supreme Court’s decision in Thole v. U.S. Bank, N.A. The Second Circuit disagreed, ruling that Elizabeth had standing because she properly alleged financial loss; Marcia’s estate received less than it would have if Carolyn had given sufficient notice regarding Marcia’s lump-sum options. Next, Carolyn argued that the district court applied “a ‘heightened’ standard of fiduciary duties based on the familial relationship between Carolyn and Marcia.” The Second Circuit ruled that the district court applied the proper fiduciary standard and upheld its ruling that Carolyn did not give proper notice of the lump-sum option because “Carolyn failed to accurately explain the effects of not taking the lump sum prior to the Plan’s termination.” The Second Circuit agreed that Carolyn’s notice was inadequate and obfuscating, and “most properly understood as litigation posturing” given its accompanying demand for money to correct the plan’s underfunding. The appellate court further agreed that Elizabeth demonstrated prejudice, concluding that Elizabeth and Marcia would have likely elected the lump sum if they had received adequate notice given the large monetary discrepancy. The court also upheld the district court’s calculation of damages, which restored Elizabeth to the financial position she would have been in if the lump-sum option had been selected. The Second Circuit then turned to Elizabeth’s cross-appeal, ruling that there was no basis to disturb the district court’s ruling that Carolyn did not breach her fiduciary duty of loyalty. The court ruled that Carolyn’s actions did not violate any plan documents or ERISA, and the post-termination distribution to herself was approved by an independent pension actuary which determined that “Carolyn was the only person who was eligible to receive additional contributions.” As a result, the court affirmed the judgment below in its entirety.
Stern v. JPMorgan Chase & Co., No. 1:25-CV-02097 (JLR), 2026 WL 654714 (S.D.N.Y. Mar. 9, 2026) (Judge Jennifer L. Rochon). This is a putative class action by current and former employees of JPMorgan Chase & Company alleging that JPMorgan and related defendants breached their fiduciary duties and engaged in prohibited transactions by mismanaging the prescription drug component of JPMorgan’s self-funded ERISA-governed employee health plan. Plaintiffs contend that defendants “agreed to or permitted grossly inflated prescription-drug prices, causing the Plan and its participants to pay millions of dollars more than necessary.” They allege that defendants failed to prudently select and scrutinize the plan’s pharmacy benefit manager (PBM), CVS Caremark, by not conducting competitive requests for proposals, failing to benchmark Caremark’s pricing against the market, and not negotiating pricing terms to protect the plan. Additionally, plaintiffs allege that defendants “permitted the Plan to pay excessive prices for prescription drugs, particularly generic drugs, relative to pharmacy acquisition costs and publicly available cash prices.” Plaintiffs also alleged that Caremark classified certain drugs as “specialty” drugs without consistent or objective standards, and that the defendants “allowed Plan participants to overpay for biosimilar drugs by narrowing the field of options.” Plaintiffs further alleged that the defendants failed to consider lower-cost alternatives to the traditional PBM model. Defendants moved to dismiss for lack of standing and failure to state a claim. On standing, defendants argued that (1) “because Plaintiffs received all benefits promised under the Plan, they suffered no cognizable injury under [the Supreme Court’s ruling in] Thole v. U.S. Bank N.A.,” (2) “Plaintiffs’ out-of-pocket costs theory of standing is too speculative because Plaintiffs do not provide the appropriate price comparisons to establish actual overpayment,” and (3) “Plaintiffs’ higher premiums theory is likewise speculative because there is no direct relationship between Plan costs and participant premiums.” The court agreed that plaintiffs’ “higher premium theory is too speculative to serve as a basis for standing,” but approved their “out-of-pocket cost theory,” noting that “[a]llegations of this kind are generally sufficient to confer standing.” The court distinguished Thole, noting that “unlike the defined-benefit pension plan in Thole, through which participants ‘receive[d] a fixed payment each month’…the Plan here is a self-funded welfare plan under which Plaintiffs allege they personally paid inflated out-of-pocket costs[.]” This “personal financial harm can confer standing.” The court distinguished other cases (including Navarro v. Wells Fargo, in which that court issued a new order last week, discussed below), finding them either different on the facts or the issues, or simply unpersuasive. Turning to the merits, the court ruled that the conduct challenged under the plaintiffs’ first two counts was not fiduciary in nature and dismissed them. These counts focused on the design and structure of the plan’s pharmacy benefit arrangements, which were settlor functions not subject to ERISA liability. The court also dismissed plaintiffs’ duty of loyalty claims, ruling that their allegations pointed to broader corporate activities, such as business relationships and joint ventures, which involved business judgments undertaken in a corporate capacity and not fiduciary actions under ERISA. The court emphasized that ERISA does not require that corporate business transactions, which may have a collateral effect on employee benefits, be performed solely in the interest of plan participants. However, the court denied defendants’ motion to dismiss counts four and five, which alleged prohibited transactions. The court noted that hiring a service provider, such as a PBM, is a fiduciary function, and plaintiffs plausibly alleged that defendants engaged in prohibited transactions by transferring plan assets to Caremark in exchange for services with unreasonable compensation. The court acknowledged that defendants “may have ample defenses to this claim,” but at this stage, under the Supreme Court’s recent decision in Cunningham v. Cornell Univ., it was compelled to let the claims move forward. Thus, defendants’ motion to dismiss was only partly successful.
Fourth Circuit
Fitzwater v. CONSOL Energy, Inc., No. 24-2088, __ F. App’x __, 2026 WL 595435 (4th Cir. Mar. 3, 2026) (Before Circuit Judges Wilkinson, Wynn, and Keenan). This ten-year-old case was brought by coal miners who were employees of CONSOL Energy, Inc. and its subsidiaries. CONSOL offered medical benefits to its employees through an ERISA-governed plan which included retiree medical benefits for employees who had worked for CONSOL for ten years and were 55 or older. Throughout, CONSOL issued plan documents containing reservation-of-rights clauses, stating that the company “reserved the right to modify or terminate the benefits plan at any time.” Plaintiffs, however, alleged that they were verbally told by CONSOL numerous times that their benefits would last a lifetime. Plaintiffs were also told, in an effort to deter unionization, that their benefits would be “at least as good as the benefits provided to members of the United Mine Workers of America…which provided lifetime retirement benefits.” Predictably, CONSOL terminated the retiree medical benefit by the end of 2015 and this action followed. Plaintiffs brought two actions against CONSOL, asserting multiple violations of ERISA, including breach of fiduciary duty because of CONSOL’s material misrepresentations about the permanence of their benefits. The actions were consolidated in 2017. The district court denied plaintiffs’ two motions for class certification, and in 2020 the court granted most of defendants’ summary judgment motion, but allowed plaintiffs’ claim for breach of fiduciary duty to proceed. (This decision was Your ERISA Watch’s case of the week in our October 28, 2020 edition.) The case was tried in February of 2021, and more than three years later the court issued its decision. The court ruled that CONSOL breached its fiduciary duty in misrepresenting the future of plaintiffs’ benefits. However, only two of the seven plaintiffs were victorious; the court found that the claims of one were time-barred while the other four did not demonstrate detrimental reliance on CONSOL’s misstatements. (We covered this ruling in our October 9, 2024 edition.) Both sides appealed to the Fourth Circuit. The court addressed class certification first, upholding the denial of plaintiffs’ two motions because plaintiffs abandoned the rationale behind their first motion and failed to address the district court’s reasoning in denying the second motion. Next, the Fourth Circuit addressed the summary judgment ruling, in which the district court rejected plaintiffs’ claim that CONSOL discriminated against certain retirees based on “claims experience.” The Fourth Circuit noted that plaintiffs’ “theory of discrimination shifted over the course of litigation,” and that regardless of their theory, they “were required to show discriminatory intent – not just differing impacts on the two groups.” The Fourth Circuit did not see any such intent, stating, “There is no evidence in the summary-judgment record that CONSOL even considered claims experience when deciding to whom it would offer the prorated payment.” Finally, the Fourth Circuit tackled the rulings at trial. Plaintiffs argued that the district court erred in finding no detrimental reliance for four of the employees, but the appellate court stated that “each of those Plaintiffs had knowledge that their benefits could be terminated at any time.” Furthermore, plaintiffs inappropriately focused on CONSOL’s behavior as a whole instead of its conduct with respect to those four employees. “This failure to grapple with factfinding that was central to the district court’s analysis – issued following a detailed, lengthy bench trial – is fatal to Plaintiffs’ arguments on appeal.” The Fourth Circuit rejected CONSOL’s arguments as well, upholding the district court’s factual determinations that CONSOL misled the two prevailing plaintiffs about their benefits and that they detrimentally relied on those misstatements by making “significant life decisions based on CONSOL’s erroneous promises.” As a result, the appellate court was “satisfied that the district court dispatched its duty admirably,” and affirmed the judgment.
Forrest v. Moore & Van Allen PLLC, No. 3:25-CV-624-MOC-SCR, __ F. Supp. 3d __, 2026 WL 607290 (W.D.N.C. Mar. 3, 2026) (Judge Max O. Cogburn Jr.). This is a putative class action by employees of Hollandia Produce Group who allege that various defendants abused the company’s employee stock ownership plan (ESOP) to enrich themselves at the expense of the ESOP and its employee beneficiaries. According to plaintiffs, in 2015 investors approached Hollandia’s owners about creating the ESOP. Hollandia’s owners agreed, and in various transactions all of Hollandia’s shares were sold to the ESOP and loans were issued to finance the transfer. GreatBanc Trust Company was appointed as trustee for the ESOP, and Moore & Van Allen (MVA) acted as GreatBanc’s legal counsel throughout this process. Plaintiffs contend that the terms of the loans, which included a 14% interest rate, gave significant control over Hollandia to the outside investors, which they used to maximize their returns at the expense of the ESOP. In 2022, the ESOP was terminated when Hollandia was sold to Local Bounti. The investors “received more than $75 million in cash and stock – of which more than 70% was paid in cash,” while “the ESOP walked away with only $3.1 million – of which only 20% was paid in cash.” Plaintiffs allege that “the ESOP beneficiaries’ retirement accounts would be worth approximately $4.2 million if the ESOP was never formed,” but instead “the ESOP beneficiaries are expected to receive just $1 million once the lock-up period expires and the ESOP’s funds are distributed.” Plaintiffs alleged numerous claims against the defendants, including breach of fiduciary duty under ERISA, prohibited transactions, and legal malpractice. Three motions to dismiss were filed: one by GreatBanc, one by the investor defendants, and one by the MVA defendants. Addressing the GreatBanc motion first, the court ruled that (a) plaintiffs’ claims were not barred by ERISA’s statute of repose because they alleged a continuing violation of fiduciary duties, (b) plaintiffs properly alleged that GreatBanc had a duty to prudently manage its investment in Hollandia and protect the ESOP’s assets from managerial malfeasance, (c) GreatBanc could be held liable for failing to investigate and pursue legal action against the other defendants, but (d) plaintiffs could not bring a claim for legal malpractice against GreatBanc. As for the investor defendants’ motion, the court held that (a) plaintiffs had standing, as they alleged financial harm to the ESOP, and the investors’ arguments to the contrary could not be resolved on a motion to dismiss, (b) plaintiffs’ breach of fiduciary duty claims were not untimely, for the same reason as their claims against GreatBanc, but their prohibited transactions claim under 29 U.S.C. § 1106(b) regarding the ESOP formation in 2015 was untimely, (c) plaintiffs sufficiently alleged that the investor defendants were fiduciaries of the ESOP because their control over GreatBanc gave them “functional authority or control over the ESOP” and because they effectively controlled Hollandia during the life of the ESOP, and (d) plaintiffs did not engage in “shotgun pleading” because they “sufficiently articulated what each defendant is charged with and provided a factual basis for those allegations.” On the MVA defendants’ motion, the court ruled that (a) plaintiffs had standing because they alleged that the defendants’ actions caused financial harm to the ESOP, (b) MVA’s attorney was not a fiduciary based solely on his role as an attorney, but plaintiffs properly alleged that he was a fiduciary “based on his role as an investor and member of the alleged conspiracy with the Investor Defendants,” (c) the statute of repose did not bar plaintiffs’ claims for the same reason as the claims against the investor defendants, and (d) issues of fact existed as to when the last act giving rise to plaintiffs’ legal malpractice claim occurred, and thus dismissal of this claim was inappropriate on timeliness grounds. As a result, plaintiffs’ complaint emerged from the motions largely unscathed, and discovery will now commence.
Ninth Circuit
McGeathy v. Reinalt-Thomas Corp., No. CV-25-01439-PHX-DLR, 2026 WL 617343 (D. Ariz. Mar. 5, 2026) (Judge Douglas L. Rayes). Cory McGeathy filed this putative class action against The Reinalt-Thomas Corporation (better known as Discount Tire) and its board of directors, alleging that they breached their fiduciary duties in their management of the company’s ERISA-governed profit-sharing retirement plan. McGeathy alleges that the plan has nearly $1.2 billion in assets, of which about $519.5 million is invested in the American Century Target Fund Suite, which he alleges is “one of the worst-performing investment suites in the entire market.” McGeathy provided market benchmarks which he alleged demonstrated underperformance, and contended that the Fund Suite was not adequately monitored or removed by defendants. Defendants moved to dismiss for failure to state a claim, arguing that ERISA does not provide a cause of action for underperforming investments and that McGeathy’s benchmarks were inappropriate. The court examined McGeathy’s five benchmarks and concluded that they were “meaningful comparators.” The court was satisfied that the complaint did not conclusorily allege that the funds were comparable; instead, it “evaluates the aims, risks, and potential rewards of each comparator fund with those of the American Century Target Fund Suite,” and “describes the glide path of each comparator fund and the types of investments they engage in.” Furthermore, McGeathy alleged that the Fund Suite “underperformed the benchmark designated by the Plan itself: the S&P Index.” The court noted that the Fund Suite’s performance was not a minor short-term loss; McGeathy “alleges the underperformance occurred over a 15-year period, 10 years prior to and then through the proposed Class Period, and that this underperformance cost Plan participants between $11 and $44 million.” As a result, the court ruled that McGeathy adequately stated a claim for breach of the fiduciary duty of prudence, and because his imprudence claim was sufficiently alleged, his derivative failure to monitor claim also survived. Defendants’ motion was denied in its entirety.
Oregon Potato Co. v. Strong, No. 4:25-CV-05139-MKD, 2026 WL 580167 (E.D. Wash. Mar. 2, 2026) (Judge Mary K. Dimke). This case is a dispute over the administration of the Oregon Potato Company’s (OPC) ERISA-governed employee medical benefit plan. OPC engaged Marsh & McLennan Agency (MMA) for brokerage and consulting services. OPC also engaged Darrell Strong and his company, DWS Holdings, d/b/a Pinnacle Peak, to provide administrative services. In 2023, MMA and Strong proposed changing the plan from a fully insured plan to a “guaranteed level funded premium plan.” Under this arrangement, OPC would pay a level premium, backed by stop-loss insurance. Fees were paid to Strong and DWS to manage the stop loss insurance and claims. However, OPC had second thoughts once the arrangement went into effect and it became aware of the extensive fees it was paying to Strong and DWS. OPC terminated its relationship with Strong, and in the ensuing months OPC alleges it became aware of a deficit in the plan, and discovered plan funds were being transferred improperly by Strong. OPC brought this action against Strong, DWS, and MMA, alleging (1) equitable relief under ERISA Section 502(a)(3) against Strong and DWS, (2) breach of fiduciary duty under ERISA Sections 404 and 405 against all defendants, (3) failure to disclose and misrepresentation against Strong and DWS, and (4) prohibited transactions under ERISA Section 406 against all defendants. MMA filed a motion to dismiss, contending that OPC did not adequately allege that MMA was a fiduciary, breached a fiduciary duty, or engaged in a prohibited transaction. The court noted that it was “undisputed that MMA is not a named fiduciary.” However, OPC alleged in its complaint that MMA “exercised management control by granting Pinnacle Peak control over banking relationships for the Plan” and “further exercised discretion over management and over the assets of the Plan by guaranteeing a level premium.” This was sufficient for the court to establish MMA’s fiduciary status. The court further determined that the complaint adequately alleged that MMA breached its fiduciary duty by misrepresenting fees and causing excessive fees to be paid, which led to prohibited transactions under ERISA. Finally, the court concluded that the plaintiffs sufficiently pleaded a prohibited transaction claim under 29 U.S.C. § 1106(a), as they alleged that MMA used its status to cause the plan to engage in prohibited transactions, including “(1) the payment of excessive fees for services performed, (2) the transfer of Plan assets for the use or benefit of a party-in-interest, and (3) the receipt of assets on their own account for a transaction involving the assets of the Plan.” As a result, the court denied MMA’s motion in its entirety.
Class Actions
Second Circuit
Carfora v. Teachers Ins. Annuity Ass’n of Am., No. 21 CIV. 8384 (KPF), 2026 WL 604448 (S.D.N.Y. Mar. 3, 2026) (Judge Katherine Polk Failla). Here at Your ERISA Watch we have reported on this putative class action numerous times, as it has been dismissed, resurrected, and is now in the discovery phase. The plaintiffs are university researchers and professors who are participants in retirement plans administered by two related TIAA entities. They have challenged TIAA’s practice of “cross-selling,” which plaintiffs contend TIAA used to encourage plan participants to divert their lower-fee employer-sponsored investments into higher-fee proprietary individually managed TIAA offerings. Plaintiffs contend, among other things, that this practice was “fraught with conflicts of interest” and did not lead to better returns. In its previous orders the court concluded that plaintiffs could not proceed with claims that sought to impute fiduciary duties on TIAA itself, but could proceed with a “knowing participation” claim against TIAA for breaches conducted by others. Before the court here was defendants’ third motion to dismiss. This time defendants challenged “whether Plaintiffs have class standing to pursue a knowing participation claim on behalf of participants in approximately 9,900 plans in which Plaintiffs themselves did not participate.” The court analyzed the difference between Article III standing and class standing, noting that there is a “‘tension’ in [Supreme Court] case law as to whether ‘variation’ between [i] a named plaintiff’s claims and [ii] the claims of putative class members ‘is a matter of Article III standing…or whether it goes to the propriety of class certification.’” Furthermore, the Second Circuit’s test on this issue “has created some confusion among district courts.” After discussing pertinent authorities, the court noted “certain patterns: Where plaintiffs allege that defendants engaged in different conduct giving rise to the same claim across class members, class standing is often found to be lacking… Where plaintiffs allege that defendants engaged in the same conduct across class members, however, class standing is often found to be present.” However, even in the second scenario, “class standing may still be lacking if the question of defendants’ liability requires the court to perform a fact-specific analysis of some other party’s conduct that dwarfs any consideration of defendants’ conduct.” Under this framework, the court concluded that plaintiffs lacked class standing to bring their knowing participation claim on behalf of participants in different retirement plans. The court found that the inquiry into whether each plan sponsor breached its fiduciary duty is highly context- and plan-specific, requiring significant differences in proof for each plan. The court emphasized that even if TIAA’s conduct was uniform, the reactions of the plan sponsors were not, and the need to inquire into those reactions precluded class standing. Plaintiffs contended that they could offer generalized proof regarding TIAA’s cross-selling activities, but the court ruled that this was insufficient because the generalized proof related to TIAA’s conduct, and did not address whether the plan sponsors adequately discharged their duties once they were triggered by TIAA’s activities. Consequently, the court determined that plaintiffs could not pursue class-wide claims for plans in which they did not participate and granted TIAA’s motion to dismiss on that basis.
ERISA Preemption
Ninth Circuit
Heintzman v. Lincoln Financial Grp., No. CV-25-01755-PHX-SHD, 2026 WL 621428 (D. Ariz. Mar. 5, 2026) (Judge Sharad H. Desai). This is a dispute between Dustin Heintzman and Lincoln Financial Group about the handling of Heintzman’s claim under Wells Fargo Company’s ERISA-governed short-term disability plan. Heintzman alleges that Lincoln’s agents engaged in deceptive and unlawful business practices, including misrepresenting the terms of the Wells Fargo plan and failing to comply with its fiduciary duties under ERISA. Specifically, Heintzman alleges that Lincoln agents failed to respond to voicemails, altered insurance documents, and disseminated false information to Wells Fargo regarding medical leave dates. Heintzman contends these actions were “willful and predatory.” Lincoln further “falsely insinuated that his Claim was closed because he was no longer employed by Wells Fargo, which Heintzman characterizes as ‘utterly false, predatory, and criminal.’” Heintzman filed this pro se action in state court, alleging state law claims for relief, and Lincoln removed it to federal court citing ERISA preemption and diversity jurisdiction. The parties then filed five motions; three by Heintzman and two by Lincoln. Addressing jurisdiction and remand first, the court bypassed the parties’ ERISA arguments, ruling that even if ERISA preemption did not apply, diversity jurisdiction existed because the action was between citizens of different states and the amount in controversy exceeded $75,000 – indeed, Heintzman “seeks $100 million in compensatory and punitive damages.” The court also rejected Heintzman’s arguments for remand, noting that his motion was untimely filed, and refused to “issue an order precluding Lincoln from seeking removal in any future state court proceedings on ERISA grounds” because “Courts do not prospectively enjoin parties from asserting jurisdictional positions in future proceedings[.]” The court then evaluated Heintzman’s motion for sanctions, which was premised on the idea that Lincoln’s attorneys failed to meet and confer with him before removing the case, and that its removal was “frivolous, made in bad faith, and constituted an abusive litigation tactic.” The court denied Heintzman’s motion, ruling that Lincoln had no legal requirement to confer with him and its removal was proper. Finally, the court turned to the merits of Heintzman’s claims. It ruled that his claims based on criminal statutes were non-starters because there is no private right of action under those statutes. As for his civil claims, the court noted that it was undisputed that the Wells Fargo disability plan was governed by ERISA. Furthermore, all of Heintzman’s claims were preempted by ERISA because, “however liberally construed,” they all “arise[] from the same nucleus of alleged conduct: Lincoln’s handling of Heintzman’s Claim, including the alleged alteration of insurance documents by Lincoln’s agent, the alleged dissemination of false information to Wells Fargo regarding Heintzman’s medical leave dates and employment status, and the alleged misrepresentations made to Heintzman during the claims administration process.” Thus, the court granted Lincoln’s motion to dismiss. Heintzman’s criminal and tort law claims were dismissed with prejudice because amendment would be futile, but the court granted Heintzman leave to file an amended complaint limited to claims arising under ERISA’s civil enforcement provisions.
Exhaustion of Administrative Remedies
Second Circuit
Gordon v. Aetna Life Ins. Co., No. 3:24-CV-1447 (VAB), 2026 WL 643134 (D. Conn. Mar. 8, 2026) (Judge Victor A. Bolden). The plaintiffs in this putative class action are transgender women who are seeking or have received gender-affirming facial reconstruction surgery, which they allege is medically necessary under their respective medical insurance plans. They are or were enrolled in health insurance plans designed, sold, or administered by Aetna Life Insurance Company, which has a clinical policy bulletin that plaintiffs allege excludes coverage for gender-affirming facial reconstruction surgeries, labeling them as cosmetic rather than medically necessary. Plaintiffs contend that this policy violates Section 1557 of the Affordable Care Act, which “prohibits a ‘health program or activity, any part of which is receiving Federal financial assistance’ from violating the non-discrimination mandate of Title IX of the Education Amendments of 1972[.]” (Title IX generally prohibits sex discrimination in education.) Aetna filed a motion to dismiss and two of the plaintiffs filed a motion for a preliminary injunction. Because this is Your ERISA Watch we will focus on Aetna’s ERISA argument in its motion to dismiss. Aetna contended that one of the plaintiffs, Alma Avalle, “failed to exhaust the administrative remedies under her ERISA-governed plan” and thus her claim was barred. The court was unconvinced. Quoting the Second Circuit, the court stated, “District courts in this Circuit have drawn a distinction between claims relating to violations of the terms of a benefit plan, and claims relating to statutory violations of ERISA, finding that the former, but not the latter, [] must be administratively exhausted.” The court noted that Avalle “asserts neither a violation of the terms of her ERISA-governed plan nor a statutory violation of ERISA. Rather, she brings a claim against Aetna for violating Section 1557 of the ACA, which contains no exhaustion requirement. And the text of ERISA is clear that it does not preempt other federal claims.” The court acknowledged that Avalle sought “individualized review” and “a grant of benefits” as remedies, but “it is neither the injury asserted nor the relief sought that dictates whether exhaustion is necessary. Rather, it is the cause of action under which the suit is brought.” In short, “Because Ms. Avalle is not bringing suit under ERISA for a violation of the terms of her plan, but rather under Section 1557 of the ACA for a violation of its non-discrimination mandate, she was not required to exhaust the administrative remedies prescribed by her plan.” Aetna’s other non-ERISA arguments were also unsuccessful, and in the end the court denied its motion to dismiss in its entirety. The court also granted preliminary injunctive relief to the two moving plaintiffs, enjoining Aetna from enforcing its clinical policy as to them.
Medical Benefit Claims
Seventh Circuit
Hegemann v. Blue Cross Blue Shield of Ill., No. 24-CV-286-WMC, 2026 WL 658368 (W.D. Wis. Mar. 9, 2026) (Judge William M. Conley). In May of 2022 Andrew Hegemann suffered a stroke of unknown cause which led to a series of medical evaluations. His physicians discovered that he suffered from a patent foramen ovale (PFO), a congenital heart defect in which there is a small opening in the wall between the upper chambers of the heart. They recommended that “a PFO closure procedure should be done for secondary stroke prevention,” and Hegemann underwent that surgery in December of 2022. Before his surgery, Hegemann was informed by his doctors that his insurer, Blue Cross Blue Shield of Illinois, had pre-approved it. However, after the surgery BCBSIL denied Hegemann’s two related claims for benefits under his ERISA-governed health plan, contending that (a) his doctors never initiated a pre-approval process with it, and (b) in any event the procedure was not medically necessary under its medical policy because of the lack of echocardiogram results supporting the need for such a procedure. Hegemann filed this action under ERISA, alleging that BCBSIL wrongfully denied his two claims, and the case proceeded to cross-motions for judgment. The court addressed exhaustion first. Aetna contended that Hegemann could not pursue one of his claims because he had failed to complete the appeal process for that claim. Hegemann acknowledged that he had not done so, but argued that exhaustion was futile because “his two claims involved the same procedure, were denied for identical reasons, and his appeal of the first denial had already been rejected.” The court agreed with Hegemann, finding that “plaintiff reasonably believed that defendant had full access to his records and that a second appeal stemming from the same procedure, which had already been denied, would certainly be denied.” Thus, the court turned to the merits, using the default de novo standard of review. Hegemann relied on three articles in the record discussing when practitioners should recommend PFO closure to patients, but the court found they had limited value: “[T]he articles only provide recommendations and suggestions for an updated PFO closure policy, rather than purporting to articulate generally accepted medical standards and giving them that status would exceed their self-proclaimed purpose.” Furthermore, “the studies proffered by plaintiff indicate that a PFO closure would put him at a higher risk of recurrent stroke and development of late atrial fibrillation.” The court also ruled that “recommendations from a health care provider are insufficient alone to establish that a service is Medically Necessary,” and that Wisconsin’s medical malpractice laws were irrelevant to determining whether Hegemann was entitled to benefits. What was relevant was the BCBSIL medical policy, which required “a large right-to-left interatrial shunt” confirmed by echocardiography. While Hegemann had undergone two echocardiography studies, one did not determine the size of the shunt while the other “revealed a bidirectional shunt, as opposed to a right-to-left shunt[.]” As a result, “the court must reluctantly grant defendant’s motion and deny plaintiff’s motion for summary judgment despite what seems a draconian result[.]” The court closed by hinting that Hegemann’s doctors might not want to insist on payment from him given their apparent missteps in the pre-approval process (“the court draws no conclusions as to whether Aspirus should be estopped seeking payment from plaintiff for his procedure”).
Pension Benefit Claims
Fifth Circuit
Anderson v. Entergy Corp., No. CV 25-2097, 2026 WL 614088 (E.D. La. Mar. 4, 2026) (Judge Jane Triche Milazzo). This case involves a dispute over the rightful beneficiary of funds in a 401(k) plan. Melissa Anne Anderson, the plaintiff, is the ex-wife of Shannon Anderson. At the time of his death, Shannon had been married to Karen Orso Anderson for four months. Shannon was employed by Entergy Services, LLC and participated in the plan, which provided that if a participant is married, the surviving spouse is deemed the beneficiary unless a written waiver is executed by the spouse to designate another beneficiary. As a result, even though Melissa was originally named as the beneficiary, the plan automatically revoked this designation when Shannon married Karen. The plan thus distributed the funds to Karen, and Melissa brought this pro se action against the plan, the benefits committee, Karen, and T. Rowe Price, the plan’s third-party administrator, asserting claims under ERISA and state law. She sought compensatory and punitive damages, and also requested that the plan be amended and the appeals process revised. All defendants filed motions to dismiss, making similar arguments. The court characterized Melissa’s ERISA claim as a wrongful denial of benefits under Section 502(a)(1)(B) and reviewed it under an abuse of discretion standard because the plan contained a grant of discretionary authority. The court found that the ERISA claim was appropriate against the committee and the plan, but not against T. Rowe Price or Karen because they had no control over plan administration. However, the court concluded that Melissa had no plausible claim under ERISA because the plan clearly designated Shannon’s surviving spouse as the beneficiary, and Karen indisputably was that person and did not waive any of her rights. The court acknowledged that Melissa believed that “this result is inequitable and contrary to the decedent’s wishes,” but this was irrelevant because the administrator was required to “act[] in compliance with the Plan terms,” and the court was not allowed to independently “decide who is most deserving of the amount at issue.” As for Melissa’s state law claims, the court quickly concluded that ERISA preempted most of them because “any claims that Plaintiff intends to pursue against the Plan, the Committee, or T. Rowe arise out of the claims handling process” and thus “related to” the plan for preemption purposes. However, the court noted that Melissa’s allegations regarding emotional distress “predominately reference actions taken by [Karen] after the death of Shannon [] and during the funeral and succession proceedings.” As a result, these allegations were not preempted by ERISA, and the court allowed Melissa’s tort claim based on these allegations to proceed because Karen “has not set forth any argument for the dismissal of Plaintiff’s state law tort claim against her.” The court thus granted the motions to dismiss, with prejudice, with the exception of Melissa’s state law claim against Karen for mental anguish.
Pleading Issues & Procedure
Eighth Circuit
Navarro v. Wells Fargo & Co., No. 24-CV-3043 (LMP/DLM), 2026 WL 591454 (D. Minn. Mar. 3, 2026) (Judge Laura M. Provinzino). The plaintiffs in this case are former employees of Wells Fargo & Company and were participants in the company’s health benefit plan. They allege that Wells Fargo breached its fiduciary duties under ERISA by mismanaging its prescription drug benefit program, which was administered by Express Scripts, Inc. (ESI), a pharmacy benefit manager (PBM). Plaintiffs contend that the prices negotiated with ESI were significantly above the pharmacy acquisition cost, and that Wells Fargo paid excessive administrative fees to ESI. This resulted in higher contributions and out-of-pocket costs for plan participants, amounting to a breach of fiduciary duties under 29 U.S.C. § 1104(a). Plaintiffs also alleged prohibited transactions under 29 U.S.C. § 1106(a)(1), and sought injunctive and equitable relief, including removal of the plan’s fiduciaries, replacement of ESI as the plan’s PBM, and restitution for losses to the plan. Wells Fargo moved to dismiss, and in March of 2025, the court granted its motion, ruling that plaintiffs lacked standing. (This ruling was Your ERISA Watch’s notable decision in our April 2, 2025 edition.) However, the court allowed plaintiffs to file an amended complaint, to which Wells Fargo responded with another motion to dismiss, which was the subject of this order. The court agreed once again with Wells Fargo, ruling that plaintiffs “have not remedied the deficiencies identified in the Court’s previous order[.]” As before, the court stressed that the plan at issue was a defined benefit plan, not a defined contribution plan, and that plaintiffs “d[o] not allege that they were denied any health benefits promised under the Plan, nor d[o] they allege that the Plan was insolvent or otherwise incapable of continuing to provide covered health benefits.” The court acknowledged plaintiffs’ argument that if Wells Fargo had negotiated a better deal, they might have paid lower contributions, but “these allegations are general in nature and do not solve the variable of [Wells Fargo’s] discretion in setting employee contribution rates.” The court emphasized that plaintiffs’ contributions were used to cover overall plan expenses, not specifically prescription drug benefits or administrative fees. Thus, the court could not draw a straight line between the alleged misconduct and pricing: “participant contribution amounts may be affected by several factors having nothing to do with prescription drug benefits…‘[t]here are simply too many variables in how Plan participants’ contribution rates are calculated’ to infer that Wells Fargo’s payments to ESI for prescription drug payments or administrative fees were the but-for cause of any increases in Plaintiffs’ required contributions.” The court also found that the plaintiffs’ theory of redressability was speculative, as it assumed Wells Fargo would maintain the same contribution ratio, which was not a given because the plan did not require such a ratio. The court ended on a sympathetic note: “To be sure, the price comparisons alleged in Plaintiffs’ complaint are staggering.” However, “it fundamentally cannot be the case that participants in a plan like the one at issue here are injured any time the contractually defined benefits to which they are entitled are available at lower cost to non-participants, absent any express promise by the plan fiduciary to provide those benefits at that lower cost or any specific allegations that the fiduciary’s misconduct diminished those benefits or rendered the plan unable to provide them.” As a result, the court once again ruled that plaintiffs did not have standing and granted Wells Fargo’s motion to dismiss.
Retaliation Claims
Second Circuit
Martin v. Google LLC, No. 3:25-CV-587 (SVN), 2026 WL 657265 (D. Conn. Mar. 9, 2026) (Judge Sarala V. Nagala). Peter Martin was a sales representative for Google who was pursuing a contract with Otis Elevator when he was diagnosed with stage four colon cancer in 2023. He alleges that even though he ultimately secured the Otis contract for Google, he was not paid appropriate commissions for it under an oral agreement he had with his supervisors at Google. In early 2024 Martin received a poor performance review, despite the Otis deal, and had several of his accounts reassigned. In July of 2024 he was terminated as part of a reduction in force. Martin brought this action, and in his amended complaint he alleged five claims: (1) violation of Section 510 of ERISA; (2) violation of Connecticut’s Wage Payment Law (Conn. Gen. Stat. § 31-72); (3) fraudulent inducement; (4) breach of contract; and (5) unjust enrichment. Google filed a motion to dismiss, and the court tackled his ERISA claim first. Martin alleged that “he was terminated with the intent to prevent him from attaining his ERISA-covered benefits, including life insurance proceeds to which his beneficiaries would have been entitled if he were still employed by Google at the time of his death.” Quoting the Second Circuit, the court noted that “[a]n essential element of plaintiff’s proof under [§ 510 of ERISA] is to show that an employer was at least in part motivated by the specific intent to engage in activity prohibited by § 510.” The court ruled that Martin “fails to plausibly allege that Google’s termination of his employment was motivated, even in part, by a specific intent to deprive him of ERISA-covered benefits.” The court explained that even if Martin’s allegations were true, “they at most show that Google intentionally terminated him due to his cancer diagnosis, a consequence of which was termination of his ERISA benefits. Plaintiff’s complaint does not take the further necessary step of alleging facts to support a plausible claim that Google’s decision to terminate him was also motivated in any part by an independent desire to terminate Plaintiff’s ERISA benefits.” As a result, the court granted Google’s motion to dismiss this claim, although it allowed Martin an opportunity to amend. As for his remaining claims, the court ruled that (1) Martin failed to allege a breach of contract because the alleged oral agreement was barred by the parol evidence rule (prohibiting evidence that contradicts a written agreement), (2) Martin could not bring a claim under Connecticut’s Wage Payment Law because he did not sufficiently allege a breach of contract, (3) unjust enrichment requires the absence of an enforceable contract, but Martin’s claim was based on his alleged agreements with Google, and (4) Martin’s fraudulent inducement claim was insufficiently alleged because the alleged promise was central to, not collateral to, the relevant agreement. As a result, the court granted Google’s motion to dismiss, but gave him leave to amend, except with regard to his fraudulent inducement claim.
Withdrawal Liability & Unpaid Contributions
Third Circuit
RTI Restoration Technologies, Inc. v. International Painters & Allied Trades Indus. Pension Fund, No. 24-2874, __ F.4th __, 2026 WL 588429 (3d Cir. Mar. 3, 2026) (Before Circuit Judges Phipps, Roth, and Rendell). The International Painters and Allied Trades Industry Pension Fund, a multi-employer pension fund, sought to collect withdrawal liability from Industrial Maintenance Industries LLC and RTI Restoration Technologies, Inc. under the Multiemployer Pension Plans Amendment Act (MPPAA), alleging that they were successors to a defunct contributing employer called CTI, which closed shop in 2013. The fund did not notify the two companies of their purported successor liability until July 2021, eight years after CTI turned the lights out. The companies filed this action for a declaratory judgment, contending that they were not liable because they were not signatories to a collective bargaining agreement with the union, and were not under common control with CTI and thus were not responsible for any of CTI’s liability. The fund counterclaimed, and the case proceeded to cross-motions for summary judgment. The district court, relying on the Third Circuit’s decision in Allied Painting & Decorating, Inc. v. Int’l Painters & Allied Trades Indus. Pension Fund (a decision we covered in our July 17, 2024 edition), ruled in favor of the companies based on the fund’s failure to notify the companies of their alleged withdrawal liability “as soon as practicable” as required by 29 U.S.C. § 1399(b)(1). The district court explained that the fund had all the information it needed to take action by 2013, but it waited to demand liability until 2021, which was too long and violated the statute. The fund appealed, contending that the companies waived their “as soon as practicable” argument because that issue can only be determined by an arbitrator, and the time for arbitration had passed. In this published decision, the Third Circuit rejected this argument and affirmed. The court held that the “as soon as practicable” requirement is an independent statutory requirement and not merely an affirmative defense subject to waiver. The court stated that timely notice and demand are essential elements of a withdrawal liability claim, and failure to meet this requirement means the claim never accrues, and thus there is no claim that even requires a defense that might be waived. In doing so, the court criticized other courts that held that the equitable defense of “laches is the only means of addressing timeliness… At bottom, laches is one vehicle for challenging timeliness, but it is not the exclusive means by which alleged delay may be addressed, nor is it the lens through which the ‘as soon as practicable’ requirement should be viewed.” The court further ruled that arbitration was not required on this issue because “timely notice and demand is an element of a withdrawal liability claim, so the existence of this element may be decided by a court sua sponte and without first submitting the matter to an arbitrator, especially where a decision is straightforward.” The court acknowledged that “the MPPAA expresses a ‘clear preference for self-regulation through arbitration,’” but this case fit the “rare case” exception discussed by the Third Circuit’s 1986 decision in Dorn’s Transp., Inc. v. Teamsters Pension Fund because (a) “the timeliness question on the record before the District Court did not require the special expertise of an arbitrator”; (b) the district court’s “decision to resolve the case on the timeliness ground without expending additional resources on the employer status issue served, rather than hindered, the goal of judicial economy”; and (c) “there would have been no benefit to insisting that the parties first arbitrate the matter to develop the factual record” because “[t]his case required little by way of factual development as all that was required was straightforward application of Allied.” Thus, the Third Circuit affirmed. The decision was not unanimous, however. Judge Peter J. Phipps acknowledged that the funds may not have acted “as soon as practicable,” but “clarity as to the resolution of that issue does not mean that the question is properly decided by a federal court instead of by an arbitrator.” Judge Phipps emphasized the MPPAA’s broad arbitration requirement, and criticized the majority’s creation of a “two-tier” approach in which there are “newly conceived ‘predicate elements,’ which are not subject to arbitration under the MPPAA[.]” Judge Phipps also questioned the majority’s application of the “rare case” exception, stating that “[u]ntil today, Dorn’s was in a dustbin” and had been limited to its facts on numerous occasions. Thus, for Judge Phipps, this case was an easy one “because the answer to the question presented here can be found in statutory text: as-soon-as-practicable determinations are subject to mandatory arbitration.”