Reichert v. Kellogg Co., No. 24-1442, __ F.4th __, 2026 WL 734673 (6th Cir. Mar. 16, 2026) (Before Circuit Judges Stranch, Bush, and Nalbandian)
This week’s notable decision is a published opinion from the Sixth Circuit diving into the messy world of SLAs, JSAs, and QJSAs.
For those who don’t know what these terms mean (and have not fallen asleep yet), they refer to ways to calculate and pay benefits under ERISA-governed defined benefit plans, i.e., traditional pensions. ERISA requires plans to offer unmarried participants a single life annuity (SLA), which pays a defined benefit during their lifetimes. For married participants, plans must offer a joint and survivor annuity (JSA), which pays out over the joint lives of the participant and his or her spouse.
The focus of our attention this week is on qualified joint and survivor annuities (QJSAs), which are JSAs that meet ERISA’s statutory requirements and are the default benefit option for a married plan participant. A QJSA allows plans to pay one benefit starting at retirement, through the death of the participant, which is then followed by another benefit to the spouse, which must be at least 50% of the initial benefit. ERISA Section 1055(d) requires that a QJSA be the “actuarial equivalent of a [SLA] for the life of the participant.”
Crucially, ERISA does not define the term “actuarial equivalent,” and this litigation was a battle over how to interpret it. The case is actually two cases in one; the Sixth Circuit consolidated appeals involving the pension plans of two companies: the Kellogg Company and FedEx Corporation. Both companies maintain ERISA-governed employee pension plans that offer married participants JSAs that they contend meet the criteria for QJSAs.
In calculating their JSAs, both companies used an interest rate and a mortality table in order to convert SLAs to a QJSA equivalent. The interest rates represented the time value of money, while the mortality tables estimated the expected longevity of plan participants. These two numbers were combined to create a “conversion factor,” which was used to translate SLA values into appropriate QJSA values. In performing these calculations, the Kellogg plan used the “Uninsured Pensioners (UP) 1984 Mortality Table,” while the FedEx plan used the UP 1984 table as well as “the 1971 GAM Mortality Table.”
The plaintiffs in both cases argued that because mortality rates have greatly improved over the last several decades, these tables were out of date. The tables generated higher mortality rates, which meant fewer total payments for the SLA comparator, resulting in a lower conversion factor for the JSAs. Because the conversion factor was lower, the monthly payments under the pension plans were also lower.
The plaintiffs filed class actions, alleging that this practice violated the actuarial equivalence requirement of Section 1055(d) and constituted a breach of fiduciary duty under 29 U.S.C. § 1104. Both lawsuits were initially unsuccessful. In both cases the district court granted motions to dismiss, ruling that Section 1055 does not require the use of particular mortality tables or actuarial assumptions. The plaintiffs appealed, and the Sixth Circuit addressed this “matter of first impression.”
The appellate court began with the statutory text, identifying the “critical interpretive issue” as “the meaning of the term ‘actuarial equivalent’ at the time of ERISA’s enactment in 1974.” The court noted that the term has been understood in actuarial practice to mean that “one benefit has an equal present value to another benefit after accounting for certain actuarial assumptions, such as mortality rates.” This “‘established meaning’ persists in the modern era.”
As a result, “actuarial scientists recognized that ensuring equal present value between or among benefits requires mortality data that appropriately reflects the expected lives of the recipients of the benefits.” Thus, when calculating pension benefits, “a mortality table was understood to be ‘appropriate’ or ‘suitable’ when it aligned with the life expectancy of the relevant participant population.”
The court further examined historical case law, and determined that it “point[ed] in the same direction – actuarial equivalence requires mortality assumptions that reasonably reflect the lives of the applicable benefit recipients. That means using up-to-date mortality data, not data from half a century ago.” The court explained that “[t]his makes good sense,” because actuarial calculations are supposed to be “based on real-world conditions.”
The court also found that this interpretation was supported by Section 1055, which refers to “the life of the participant.” This reference to a concrete individual person “necessarily requires the use of mortality data reasonably reflecting the life expectancy of a retiree living in the present day.” Treasury Department regulations also aligned with this interpretation, because they provided that “actuarial equivalence ‘may be determined, on the basis of consistently applied reasonable actuarial factors, for each participant or for all participants or reasonable groupings of participants[.]’”
Thus, the court concluded that plan administrators could not use “whatever assumptions they wish”; they were constrained by reasonableness. Of course, “reasonableness is a range, not a precise prescription…Actuarial science requires reasonable estimates, and different actuaries can come to different conclusions on what the exact best estimates are in each situation.” Under ERISA, those conclusions are entitled to deference “if they are ‘within the scope of professional acceptability.’” However, those assumptions must “reasonably reflect the life expectancy of its plan participants[.]” If they do not, “that employer has exceeded the scope of actuarial acceptability and failed to adhere to § 1055(d)’s actuarial equivalence requirement.”
With this understanding, the Sixth Circuit turned to plaintiffs’ specific allegations and had no trouble concluding that they had alleged plausible claims. Plaintiffs had alleged that defendants used outdated and unreasonable mortality data which did not satisfy Section 1055’s actuarial equivalence requirement and resulted in lower benefit payments. “Plaintiffs have thus stated plausible claims for violation of § 1055 and breach of fiduciary duty under ERISA.”
The court then turned to defendants’ arguments and found them unavailing. Defendants contended that “§ 1055(d) does not expressly mandate that plans use ‘reasonable’ actuarial assumptions or delineate particular actuarial factors that plans must follow,” noting that other sections of ERISA explicitly used the word “reasonable” or “identif[ied] particular actuarial factors that plans should use[.]”
However, the court stated flatly that “[a]dopting this view of the statute would render the text of § 1055(d)(1)(B) meaningless.” This argument would “authorize employers to select data that allows the conversion between an SLA and a QJSA to work any way the employer wants, without regard to whether the two forms of benefits have a present value that is in fact equivalent,” thus rendering the “actuarial equivalence” requirement irrelevant.
Defendants attempted to assure the court that “they do not currently use…outlandish and outdated data,” but this “does not address the core interpretive problem, which is that their construction would allow an employer to use mortality rates that are completely out of step with the mortality rate of modern-day plan participants…Generally, courts should avoid interpreting statutes in a manner that could result in ‘absurd’ outcomes.”
The court also addressed defendants’ argument that Section 1055(d) “effectively acts as a disclosure mandate, requiring employers to disclose their actuarial assumptions in their plan documents and adhere to [them].” The court found that this argument “makes little sense.” ERISA already requires administrators to disclose plan terms, and thus defendants’ interpretation “would impermissibly render the provision entirely superfluous.” Furthermore, defendants’ interpretation “imposes no substantive limitations on the nature of the benefit itself” and thus “fails to add any ‘mean[ing]’ to the term QJSA in § 1055(d)(1).”
The court acknowledged that other sections of ERISA expressly impose a reasonableness requirement, but did not conclude that this meant Section 1055 lacked one. The court examined the other sections cited by defendants, but explained that they were “dissimilar, with different language and different formulations addressing different circumstances.” Furthermore, “none of these five sections…contain the term ‘actuarial equivalent’ or the clause ‘for the life of the participant,’” and thus they were unhelpful.
Finally, the court addressed defendants’ policy concerns, which included the difficulty of judicially determining what makes a set of actuarial assumptions “reasonable,” and the prospect of increased litigation challenging and interfering with plan administration. The court noted that “[p]ure policy considerations, of course, do not constitute a proper method of statutory interpretation,” and stated that courts were well equipped to evaluate reasonableness, especially in the ERISA context: “[t]his type of litigation is well within the wheelhouse of ERISA.” Furthermore, plans were still entitled to deference in their choice of reasonable assumptions.
As a result, the Sixth Circuit reversed and remanded. The decision was not unanimous, however. Judge John B. Nalbandian dissented, contending that Section 1055 does not require the use of “reasonable” actuarial assumptions. He stated that the term “reasonable” is absent from the statutory text and that the ordinary meaning of “actuarial equivalent,” as well as the “downstream” terms such as SLA and QJSA, do not impute a reasonableness requirement.
Judge Nalbandian also contended that the majority improperly relied on non-binding sources and “overemphasize[d] marginal sources,” such as academic literature and inapposite state court decisions, to read a reasonableness requirement into the statute.
Furthermore, Judge Nalbandian minimized the majority’s concern that plans could use wildly outdated mortality assumptions by noting that the Internal Revenue Code and its regulations already impose a reasonableness requirement on actuarial assumptions for pension plans. Violating these rules would lead to harsh consequences for plans, and thus “the value of those tax exemptions and deductions likely dwarf any plausible liability under ERISA.”
Finally, Judge Nalbandian raised the specter of “even more litigation and higher administrative costs,” which will be “passed on and will ultimately injure the continued viability of the plans. So it’s hard to see how this standard will benefit anyone besides the attorneys who litigate these cases.”
These arguments obviously did not carry the day, however, so in the Sixth Circuit at least the rule going forward is that Section 1055(d) prohibits employers from using unreasonable actuarial assumptions when calculating QJSAs.
Below is a summary of this past week’s notable ERISA decisions by subject matter and jurisdiction.
Arbitration
Second Circuit
Trustees of Int’l Union of Bricklayers & Allied Craftworkers Local 1 Connecticut Health Fund v. Elevance, Inc. f/k/a Anthem, Inc., No. 3:22-CV-1541 (SFR), 2026 WL 788179 (D. Conn. Mar. 20, 2026) (Judge Sarah F. Russell). The plaintiffs in this case, the Local 1 Fund and the Local 40 Fund, are two multi-employer, self-funded health benefit plans that provide medical benefits to union members, retirees, and their dependents. They entered into administrative service agreements (ASAs) with Elevance, Inc., formerly known as Anthem, Inc., in 2007 (Local 1) and 2020 (Local 40) to perform services for the plans. In 2022, however, the trustees of the plans requested claims data from Anthem and Anthem pushed back. As a result, plaintiffs obtained claims data from a third-party vendor, Zenith, which “revealed numerous irregularities.” The trustees of the funds thus filed this putative class action against Anthem and its affiliates alleging violations of ERISA. Defendants moved to compel arbitration of Local 1’s claims pursuant to the 2007 ASA, and argued that Local 40’s claims should be stayed pending that arbitration. Plaintiffs opposed, arguing that defendants waived their right to arbitrate through their conduct in the litigation. The court agreed with the funds. The court found that a valid arbitration agreement existed between Anthem and the Local 1 Fund because the 2007 ASA included a dispute resolution clause that allowed for arbitration. However, the court concluded that defendants waived their right to arbitrate by acting inconsistently with that right. The court explained that defendants had engaged in substantial litigation conduct, including filing a motion to dismiss, engaging in discovery, and participating in mediation, before they filed their motion to compel. The court emphasized that “[a]rbitration is not a fallback position,” and that seeking “full and final resolution of claims against them in federal court” is “not consistent with the right to compel arbitration.” The court rejected defendants’ claim of lack of knowledge about the arbitration provision because they knew or should have known about the dispute resolution process outlined in the ASA before the litigation commenced. Defendants’ motion to compel arbitration was thus denied.
Attorneys’ Fees
Tenth Circuit
K.S. v. Cigna Health & Life Ins. Co., No. 1:22-CV-00004, 2026 WL 752700 (D. Utah Mar. 17, 2026) (Magistrate Judge Dustin B. Pead). The plaintiffs in this case, mother and son K.S. and Z.S., brought this action challenging Cigna Health and Life Insurance Company’s denial of their claim for benefits under the Accenture LLP Benefit Plan for mental health treatment Z.S. received in 2019 and 2020. Plaintiffs alleged two claims in their complaint against Cigna and the Accenture plan: one for recovery of benefits under 29 U.S.C § 1132(a)(1)(B), and one for violation of the Mental Health Parity and Addiction Equity Act (MHPAEA), under 29 U.S.C. § 1132(a)(3). The parties cross-moved for summary judgment, and in 2024 the court granted plaintiffs’ motion in part while denying defendants’ motion entirely. (Your ERISA Watch reported on this decision in our July 17, 2024 edition.) The court ruled that Cigna’s denial was arbitrary and capricious because it failed to adequately explain its reasoning, did not engage with the opinions of Z.S.’s treating physicians, and did not address plaintiffs’ coverage arguments. The court remanded to Cigna for further consideration, after which Cigna reversed its denial for treatment Z.S. received from February 5, 2019 through October 15, 2019, but upheld its denial for treatment from October 16, 2019 through March 9, 2020. Plaintiffs then filed a “motion for a determination of benefits and an award of attorneys fees, prejudgment interest, and costs.” The parties agreed that the amount of benefits owed was $124,146, and thus the court awarded this amount. As for attorney’s fees, the court agreed that plaintiffs had achieved “some degree of success on the merits.” The court then applied the Tenth Circuit’s five-factor test and concluded that four of them weighed in favor of an award, and thus a fee award was appropriate. Turning to the calculation of fees, plaintiffs’ counsel Brian S. King requested an award using an hourly rate of $650, but the court found this “somewhat high. No court in this district has found $650 to be a reasonable rate for Mr. King.” (This is not exactly accurate; another court in Utah just ruled that $650 per hour was appropriate for Mr. King.) As a result, the court “finds it appropriate to award a rate of $600 per hour.” As for the time spent on the case, Mr. King attested he spent 68 hours, but the court reduced this amount by 2.1 hours for non-compensable pre-litigation work. Defendants further argued that plaintiffs’ fee award should be reduced because they abandoned their Parity Act claim, but “the court finds that the Plaintiffs’ MHPAEA claim and ERISA claim ‘involve a common core of facts’ and are ‘based on related legal theories’ and declines to reduce the billed hours amount.” The court also rejected defendants’ argument that the fee should be reduced because plaintiffs did not receive all the benefits they sought. Finally, the court approved plaintiffs’ request for $400 in costs and a prejudgment interest rate of ten percent, a rate “courts in this district have commonly applied.” As a result, the court ordered defendants to pay plaintiffs $124,146 in benefits, $88,296.72 in prejudgment interest, $73,822.50 in attorneys’ fees, and $400 in costs.
Breach of Fiduciary Duty
Fourth Circuit
Beroset v. Duke Univ., No. 1:25-CV-919, 2026 WL 765518 (M.D.N.C. Mar. 16, 2026) (Judge Catherine C. Eagles). This is yet another in a long line of cases alleging that a benefit plan administrator breached its fiduciary duties by misallocating forfeited employer contributions in an ERISA-governed defined contribution retirement plan. The plan in this case was sponsored by Duke University. Employees can make voluntary contributions to Duke’s plan, which immediately vest, while Duke also makes certain contributions for eligible employees, which are subject to a three-year vesting period. If employees leave before vesting, they forfeit Duke’s contributions. The question, as always, is what should be done with these forfeited contributions. The plan allowed Duke to use them to fund employer contributions for returning employees, pay plan expenses, or reduce future employer contributions. Plaintiff Frances Beroset alleges that Duke never used the forfeited contributions to pay plan expenses, which constituted a breach of fiduciary duty to plan participants. Beroset argued that “it is always in the best interests of plan participants when their plan expenses are defrayed.” Duke filed a motion to dismiss, which the court granted in this brief order. Duke argued that the plan explicitly granted it discretion to choose how to use the forfeited contributions, and that Beroset did not allege that she or any other participants did not receive the full benefits the plan promised. The court noted that “[m]ost courts have rejected ERISA claims concerning forfeited employer contributions, reasoning that ‘when (1) a plan document gives a plan fiduciary discretion in how to use forfeitures and (2) participants otherwise receive everything guaranteed by the plan’s terms, plan fiduciaries do not violate their duty of loyalty merely by declining to use forfeitures to cover administrative expenses.’” The court “agree[d] with the weight of authority and finds the reasoning in those cases to be persuasive.” Beroset argued that she “does not allege or argue that allocating forfeitures to offset employer contributions is a per se breach of fiduciary duty,” but the court was unconvinced: “when one reads her complaint and her brief, it is hard to see that.” The court thus considered Beroset’s claims to be per se claims that were untenable for the reasons just discussed. The court further ruled that even if Beroset was not bringing a per se claim, her complaint failed to satisfactorily allege “fact-specific fiduciary misconduct” because even though “the operative complaint is very long and full of many details,” the specific allegations regarding Duke’s choices were “conclusory” and thus “insufficient to state a claim.” The court thus granted Duke’s motion to dismiss.
Sixth Circuit
Greene v. Progressive Corp., No. 1:24-CV-01890, 2026 WL 785004 (N.D. Ohio Mar. 20, 2026) (Judge David A. Ruiz). The plaintiffs in this case are current and former employees of Progressive Corporation who allege that the wellness program in Progressive’s employee health plan violates ERISA. The program offers lower health insurance premiums to participants who are tobacco-free or received the COVID-19 vaccine. Tobacco-free participants pay $15 less per pay period, and those vaccinated against COVID-19 paid $25 less. Plaintiffs characterized these as “surcharges” on tobacco users and those who opted against the vaccine, and alleged they were not compliant with federal law. They alleged five counts: (1) unlawful imposition of a discriminatory tobacco surcharge in violation of 29 U.S.C. § 1182; (2) unlawful imposition of a discriminatory vaccine surcharge in violation of 29 U.S.C. § 1182; (3) failure to notify of a reasonable alternative standard for avoiding the tobacco surcharge in violation of 29 U.S.C. § 1182 and 29 C.F.R. § 2590.702; (4) failure to notify of a reasonable alternative standard for avoiding the vaccine surcharge in violation of 29 U.S.C. § 1182 and 29 C.F.R. § 2590.702; and (5) breach of fiduciary duty in violation of ERISA, §§ 404 and 406. Progressive filed a motion to dismiss for failure to state a claim and for lack of subject-matter jurisdiction, contending that plaintiffs lacked standing. The court found that the wellness program provided adequate “notice of a reasonable alternative standard” because it “substantively matches the sample language – nearly verbatim – provided by the [Department of Labor].” The court rejected plaintiffs’ argument that the plan did not describe the program’s reasonable alternative standard; the plan was not required to do so under the regulations, which only required it to disclose that such a program was available. Next, plaintiffs argued that the wellness program did not provide retroactive reimbursement for surcharges, which they claimed violated ERISA’s requirement to “provide the ‘full reward’ to all similarly situated individuals.” The court disagreed, finding that retroactive reimbursements were not legally required: “[T]he statute does not say anything about a retroactive reward and there is no reason to imbue the statute with such a requirement.” The court admitted that other judges had ruled to the contrary, but found their interpretations “run[] contrary to the plain language of the statute… If Congress intended the statute to provide the reward retroactive for the entire plan year, then it could have easily stated as much.” Next, the court addressed plaintiffs’ breach of fiduciary duty claim, ruling that Progressive acted as a settlor, not a fiduciary, when designing the wellness programs, and thus the claim was unviable. For the same reason the court also found no prohibited transaction, as the collection of premiums and surcharges was a feature of the plan’s structure, implicating a settlor rather than a fiduciary function. Finally, the court declined to address the issue of standing and administrative exhaustion because it had already determined that plaintiffs failed to state a claim: “In the interests of judicial economy, the Court finds resolution of this issue to be unnecessary.” As a result, the court granted Progressive’s motion and dismissed plaintiffs’ complaint.
Ninth Circuit
Johnson v. Carpenters of W. Wash. Bd. of Trustees, No. 2:22-CV-01079-JHC, 2026 WL 799702 (W.D. Wash. Mar. 23, 2026) (Judge John H. Chun). The plaintiffs in this class action are union carpenters who were participants in two multi-employer pension plans, the “DC Plan” and the “Pension Plan.” The two plans were managed by the Carpenters of Western Washington Board of Trustees and Callan, LLC. Plaintiffs contend that defendants mismanaged the plan by inappropriately investing plan funds. Specifically, they allege that between 2014 and 2016, defendants “invested nearly a fifth of the Plans’ assets into two volatility hedge funds[.]” These investments “were wildly inappropriate in light of the Plans’ investment timeframe, plan structure, and risk tolerance.” Plaintiffs allege that by early 2020, “the Funds suffered, leaving the Plans with $250 million in losses and resulting in reduced payouts to participants.” Plaintiffs filed suit in 2022, alleging breach of fiduciary duty under ERISA. They also pled alternative claims under common law fiduciary and negligence theories. Defendants filed a motion to dismiss, which was granted without leave to amend. However, the Ninth Circuit rescued plaintiffs in 2024, ruling that they had standing, and that they sufficiently stated their claims of imprudence and failure to monitor under ERISA. (Your ERISA Watch covered this decision in our August 7, 2024 edition.) Now the case is on remand to the district court, and defendant Callan LLC has filed a motion for judgment on the pleadings, which was joined by the trustees. (Meanwhile, the court has already granted the parties’ stipulated motion certifying and defining the class.) Callan argued in its motion that the Ninth Circuit’s recent decision in Anderson v. Intel Corp. Inv. Pol’y Comm., 137 F.4th 1015 (9th Cir. 2025), constitutes an “intervening change in the law” by imposing a “meaningful benchmark” requirement, thus compelling the district court to revisit the Ninth Circuit’s earlier ruling in this case that “Plaintiffs have [] stated a claim under ERISA.” (Your ERISA Watch reported on the Anderson decision in our May 28, 2025 edition.) The district court disagreed, noting that Anderson itself found that “[c]omparison is not a pleading requirement for a breach of fiduciary claim.” In any event, “this is not an underperformance case” that might require pleading of meaningful benchmarks. The court explained that plaintiffs did not rely solely on circumstantial allegations and had directly alleged facts showing the imprudence of the investments. Furthermore, the court rejected defendants’ argument that plaintiffs’ claims constituted an impermissible “per se challenge” to volatility hedge funds because plaintiffs had pleaded facts showing the investments “‘were imprudent at the scale [Defendant] made them’ and alleged ‘that those investments were particularly risky.’” Furthermore, defendants plausibly violated ERISA’s “require[ment] that a fiduciary ‘diversify[ ] the investments of the plan so as to minimize the risk of large losses.’” Finally, regarding the common law claims against Callan, the court ruled that it “need not determine if the state-law claims relate to or connect with the ERISA plan because the Ninth Circuit has already determined Defendant Callan’s ERISA fiduciary status.” Furthermore, plaintiffs had conceded that if Callan acted as an ERISA fiduciary, their common law claims would be preempted. As a result, the court granted defendants’ motion as to plaintiffs’ common law claims, but denied it as to their claims under ERISA.
Disability Benefit Claims
Second Circuit
Alexander v. Unum Life Ins. Co. of Am., No. 25-974, __ F. App’x __, 2026 WL 742865 (2d Cir. Mar. 17, 2026) (Before Circuit Judges Sullivan, Lee, and Merriam). Katherine Alexander was a nurse practitioner who was covered by an ERISA-governed long-term disability (LTD) employee benefit plan insured by Unum Life Insurance Company of America. Alexander alleged that she contracted COVID-19 in 2020, which resulted in long COVID symptoms, including chronic fatigue and brain fog. In September 2021, she reported that she “had trouble standing, walking, and using a computer for more than short periods at a time, had reduced energy and focus, and was suffering from malaise.” She stopped working on her doctor’s advice in December of 2021 and submitted claims for short-term disability (STD) and LTD benefits. Her STD benefits were approved for the maximum duration by Unum, but Unum denied her LTD claim, contending that she did not meet the plan’s definition of disability throughout the waiting period, or “elimination period,” before benefits began. Her administrative appeal was unsuccessful, so she filed this action. The parties filed cross-motions for judgment, and after a de novo review of the record, the district court determined that Alexander had not proven that she was disabled throughout the LTD plan’s elimination period. The court entered judgment in Unum’s favor, and Alexander appealed to the Second Circuit. The appellate court reviewed the district court’s findings of fact for clear error and affirmed the judgment. The court noted that Alexander’s psychiatric care provider agreed she was not prevented from working from a cognitive standpoint, and she “presented only sparse evidence to support her claim of being unable to meet the light physical exertion requirements of her position throughout the elimination period[.]” At best, the Second Circuit ruled, the record “reveals two permissible views of the evidence,” and this was insufficient to support a reversal under the “clearly erroneous” standard of review. The court then addressed Alexander’s arguments and rejected them. Alexander argued that the approval of STD benefits during the LTD elimination period should have resulted in the approval of LTD benefits, but “nothing in the language of the plan suggests that Unum’s decision to grant Alexander short-term benefits is binding for purposes of whether she is eligible to receive long-term benefits as well.” The court also found no error in the district court’s decision to assign minimal weight to Alexander’s self-reported symptoms and focus on the lack of objective evidence supporting her claimed inability to work. Finally, the court upheld the district court’s conclusion that Alexander failed to prove a lack of cognitive fitness, admitting that Alexander “marshals some evidence to the contrary,” but the district court’s conclusion was “‘plausible in light of the record viewed in its entirety’ and must therefore be upheld.” The Second Circuit thus affirmed.
Sixth Circuit
Johndrow v. Unum Life Ins. Co. of Am., No. 1:21-CV-296, 2026 WL 777232 (E.D. Tenn. Mar. 19, 2026) (Judge Charles E. Atchley, Jr.). David Johndrow was employed by the Massachusetts Medical Society in 2018 when he experienced sudden neck and head pain, leading to a diagnosis of occipital neuralgia and left shoulder pain. He stopped working and filed a claim under his employer’s long-term disability (LTD) benefit plan, insured by Unum Life Insurance Company of America. Unum initially denied his LTD claim, but later reversed its decision, finding him disabled due to mental illness. Based on this limitation, Unum terminated Johndrow’s benefits in March of 2021 based on the LTD plan’s 24-month limit on mental illness benefits. Meanwhile, Johndrow continued to pursue various treatments for his physical ailments, including nerve blocks, epidural injections, and surgeries, and was prescribed strong pain medications, including fentanyl and oxycodone. Johndrow appealed Unum’s decision, contending that his disability was not due to mental illness, but Unum upheld its decision, so Johndrow brought this action under ERISA seeking reinstatement of his LTD benefits. In 2022 the court ruled that Unum’s decision was erroneous, but rather than award benefits it remanded to Unum for “further factual development,” including an independent medical examination (IME). Unum conducted the IME and the case returned to court. Johndrow filed a motion for judgment on which the court ruled in this order. The court reviewed Johndrow’s medical records and concluded that he was physically disabled as of March of 2021 based on the preponderance of the evidence, which included assessments from treating physicians, neurocognitive evaluations, and the IME report. The court noted that Johndrow’s pain was not pharmacologically controlled, undermining the IME report’s conclusion that he could perform sedentary work if his pain was managed. The court emphasized the consistency of Johndrow’s medical records and the opinions of his treating physicians, who uniformly believed he was incapable of full-time work. The court concluded that Johndrow’s inability to control his headache pain and the resulting decrease in cognitive and physical capacity rendered him disabled under the policy. Consequently, “After four years of litigating its obligations under the Policy, Unum must now provide Johndrow with the benefits to which he has long been entitled.” The court awarded Johndrow LTD benefits from March of 2021 through the date of judgment.
Life Insurance & AD&D Benefit Claims
Sixth Circuit
Florentino v. Hartford Life & Accident Ins. Co., No. 3:24-CV-643-CHB, 2026 WL 751918 (W.D. Ky. Mar. 17, 2026) (Judge Claria Horn Boom). In 2023 Michael Florentino enrolled in $440,000 of ERISA-governed supplemental life insurance coverage, issued by Hartford Life and Accident Insurance Company, during his employer’s benefit open enrollment period. This included a “Guaranteed Issue Amount” of $200,000 and an additional $240,000 that required evidence of insurability. Michael completed a “Personal Health Application” (PHA) and answered “No” to a question asking, “Within the past 5 years, have you used any controlled substances, with the exception of those taken as prescribed by your physician, been diagnosed or treated for drug or alcohol abuse (excluding support groups), or been convicted of operating a motor vehicle while under the influence of drugs or alcohol?” Unfortunately, Michael had a history of opioid abuse, which he did not disclose in the PHA. This led to his death in February of 2024 from acute fentanyl and acetyl fentanyl intoxication. After Michael’s death, Hartford reviewed his medical records and rescinded the supplemental coverage, asserting that the PHA contained a material misrepresentation. His beneficiary, Jillian Florentino, appealed to no avail and then filed this action. The parties submitted cross-motions for judgment. They disputed which standard of review applied; Hartford argued for abuse of discretion based on plan language granting it discretionary authority while Jillian argued for de novo because she lived in Texas, which bans discretionary clauses in insurance policies. The court declined to rule on the issue because “Plaintiff’s claim fails regardless of which standard of review the Court applies.” The court applied federal common law in determining whether Hartford’s rescission was valid and ruled that the case was “remarkably similar” to a 2022 Sixth Circuit case (Campbell v. Hartford, discussed in our March 9, 2022 edition) in which Hartford prevailed. The court “struggles to distinguish the facts in the present case from Campbell’s[.]” The court noted that Michael “had a similar history of drug abuse and treatment at the time he made that misrepresentation,” he “admitted to abusing opioids within three years of applying for life insurance and within months after applying,” and was diagnosed with “continuous opioid dependence (disorder)” and “opioid dependence.” These misrepresentations were material because they affected Hartford’s risk and were “extremely important to the underwriting decision.” Jillian contended that Hartford (1) failed to establish Michael’s intent to deceive, (2) did not comply with the policy terms for contesting and rescinding coverage, and (3) did not remit insurance premiums to plaintiff, which she contended was a “condition precedent” for rescission. The court disagreed. The court held that (1) under federal common law, an insured’s good faith is irrelevant to the materiality analysis, and thus, Hartford did not need to prove Michael’s intent to deceive, (2) the “signature” and “copy” requirements in the policy’s incontestability clause applied only after the expiration of the two-year incontestability period, which had not occurred, and (3) there was no requirement under federal common law or the policy for Hartford to remit premiums as a condition precedent to rescission. (The court noted that Jillian was instructed to contact Michael’s employer for potential premium reimbursement.) As a result, the court granted Hartford’s motion for judgment and denied Jillian’s.
Medical Benefit Claims
Fifth Circuit
M.W. v. Health Care Serv. Corp., No. 3:24-CV-600-N, 2026 WL 773092 (N.D. Tex. Mar. 18, 2026) (Judge David C. Godbey). This is a dispute over health insurance coverage for L.W., the child of M.W., under an ERISA-governed health plan administered by Health Care Service Corporation, better known as Blue Cross Blue Shield of Texas (BCBSTX). L.W. received treatment at Innercept, a residential treatment center, in 2021 and 2022. When Innercept submitted claims, BCBSTX “voided its authorization” for coverage, offering three different explanations in its various explanations of benefits (EOBs): (1) the treatment was excluded from coverage; (2) it needed more information to process the claim; and (3) “the provider was not eligible to bill this type of service according to the provider’s credentials.” M.W. appealed and filed a complaint with the Texas Department of Insurance (TDI), but when BCBSTX responded to the TDI, it contended that it had never denied M.W.’s claim at all. BCBSTX admitted that it received M.W.’s appeal, but it “did not ‘complete [] an appeal because there was no denial’ for the authorization… Instead, BCBSTX ‘voided’ it because the request ‘did not meet the guidelines outlined in the member’s plan.’” M.W. and L.W. filed suit, asserting claims under ERISA and the Mental Health Parity and Addiction Act. They alleged that BCBSTX committed procedural violations under ERISA by failing to provide adequate notice and a full and fair review of its denial of benefits. Plaintiffs also contended that BCBSTX’s policy was more restrictive for mental health benefits compared to medical and surgical benefits, thus violating the Parity Act. The parties filed cross-motions for summary judgment which were decided in this order. The court agreed with plaintiffs that BCBSTX did not substantially comply with ERISA’s procedural requirements. Initially, the court “finds that voiding authorization is functionally equivalent to a denial. The Plan does not define what ‘voiding’ authorization is. Nor does it differentiate between denying and voiding a claim in its ‘Claim Filing’ procedures.” As a result, BCBSTX was obliged to comply with ERISA Section 1133 (“Claims procedure”), which it did not. Specifically, BCBSTX did not give plaintiffs “adequate notice in writing…setting forth the specific reasons for such denial” under Section 1133(1), and did not give plaintiffs “a full and fair review” under Section 1133(2). Under Section 1133(1), the court found that BCBSTX did not engage in a “meaningful dialogue” with plaintiffs. The court emphasized that oral communications and third-party responses did not satisfy the requirement for written notice. Thus, the “only qualified writings are the EOBs,” and these did not provide adequate written notice because they did not specify the reasons for the adverse determination or the specific plan provisions on which the determination was based. As for Section 1133(2), the court found that BCBSTX never conducted an appeal, in violation of the plan’s requirements. Thus, “Plaintiffs were not afforded an opportunity to address the accuracy and reliability of the evidence” used to “void” their claims. The court noted that in conducting this analysis, “BCBSTX cannot rely on its argument that Innercept did not qualify as a licensed facility because it did not give adequate notice to Plaintiffs it denied authorization for this reason.” As for plaintiffs’ Parity Act claim, the court chose not to address it, concluding that BCBSTX’s procedural violations were a “threshold issue” that must be resolved first. The court determined that the proper remedy was to remand the case to BCBSTX for a full and fair review, but with the proviso that “BCBSTX is barred from introducing arguments regarding Innercept’s licensure.” The court retained jurisdiction and stayed the case pending remand.
Tenth Circuit
E.W. v. Health Net Life Ins. Co., No. 2:19-CV-00499-DBB-DBP, 2026 WL 800480 (D. Utah Mar. 23, 2026) (Judge David Barlow). Plaintiff E.W. was a participant in an ERISA-governed health insurance plan insured and administered by Health Net Life Insurance Company. E.W.’s daughter, I.W., struggled with anxiety, depression, and anorexia, leading to her 2016 admission to Uinta, an adolescent mental health residential treatment facility. Health Net initially authorized coverage for I.W.’s treatment, but denied it in February of 2017, determining that further treatment was not medically necessary based on its clinical guidelines, the InterQual Criteria. I.W. remained at Uinta until December of 2017. Plaintiffs unsuccessfully appealed, and an independent review by the Arizona Department of Insurance also supported Health Net’s denial. As a result, plaintiffs filed this action in July of 2019, alleging that the denial of coverage violated ERISA and the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). The district court initially dismissed the MHPAEA claim and allowed the ERISA claim to proceed, and on cross-motions for summary judgment the court entered judgment for Health Net on the ERISA claim. Plaintiffs appealed to the Tenth Circuit, which affirmed summary judgment for Health Net on the ERISA claim. However, it reversed the dismissal of the MHPAEA claim, establishing a four-part test for such claims. (Your ERISA Watch covered this decision in our November 29, 2023 edition.) This ruling represented the district court’s effort to apply that test on remand. The court addressed standing first. Plaintiffs argued that Health Net’s denial of their claim rested on the application of the InterQual criteria, which violated the MHPAEA. The court ruled that this was sufficient to grant them standing because there was no finding that treatment was not medically necessary without the application of the InterQual criteria. Thus, the court turned to the merits. The court noted that “it is undisputed that the Plan is subject to the Parity Act and that it covers both mental health care and medical/surgical care. At issue is whether Health Net applied more restrictive limitations on mental health care than on medical/surgical care.” Plaintiffs advanced three arguments, none of which convinced the court. First, the court ruled that plaintiffs failed to establish that the InterQual criteria were not generally accepted standards of care for residential mental health treatment. The court noted that federal courts have recognized the widespread adoption of InterQual criteria, which were “developed by independent companies” and are used by “over 75% of hospitals nationwide.” The court also found that the InterQual criteria for residential treatment were not more stringent than the criteria for analogous medical/surgical care, such as skilled nursing facility (SNF) guidelines. The court found that “the residential treatment and SNF criteria both align with generally accepted standards of care and focus on whether the patient’s symptoms warrant treatment in a daily, round-the-clock facility or a less intensive setting. Moreover, the criteria used in the denials are ‘comparable’ to the SNF guidelines.” Finally, the court rejected plaintiffs’ argument that Health Net misapplied the InterQual criteria because the Tenth Circuit had already considered and dismissed this argument on appeal. The court deferred the issue of attorneys’ fees and costs, granting both parties leave to file supplemental briefing on the matter.
Eleventh Circuit
Mendoza v. Aetna Life Ins. Co., No. 23-13674, __ F. App’x __, 2026 WL 775293 (11th Cir. Mar. 19, 2026) (Before Circuit Judges Newsom, Lagoa, and Kidd). Dina Mendoza gave birth to twin daughters in 2020. However, the newborns required significant medical care, including an extended stay in the ICU, resulting in bills totaling a whopping $420,269. Insurance to the rescue? Unfortunately no. The treatment was billed to Aetna Life Insurance Company, which was Mendoza’s insurer through her ERISA-governed employee health plan. Aetna denied coverage under the plan’s coordination of benefits (COB) provision, contending that the twins’ father’s insurance carrier was the primary insurer. Mendoza argued that the newborns were not enrolled in the father’s plan and that his plan did not cover the newborns’ medical costs, making Aetna the primary insurer. However, when she filed suit the district court disagreed, dismissing her case with prejudice on the ground that she failed to state a claim. The district court determined that the COB’s “birthday rule,” which provides that “the plan of the parent whose birthday falls earlier in the calendar year covers dependent children of parents who are married or living together,” meant that the father’s plan was the primary insurance, and that Mendoza failed to address this issue. (Your ERISA Watch covered this decision in our September 20, 2023 edition.) Mendoza appealed. In this unpublished decision the Eleventh Circuit agreed in part with the district court. The court noted that Mendoza acknowledged that the father had his own plan, and thus “Mendoza was required to plausibly allege facts showing either that the terms of the father’s plan did not provide coverage for the newborns’ medical costs or that application of the COB provision’s birthday rule does not render her insurance plan secondary to the father’s plan. But Mendoza did neither.” Mendoza argued that she satisfactorily alleged generally that the newborns did not have insurance under the father’s plan, but this was not specific enough for the Eleventh Circuit: “[H]er allegations merely establish (1) that the father had a single-person insurance plan and (2) that the newborns were eventually enrolled in her plan, not the father’s.” These facts were only “consistent with Aetna’s liability, but, as pleaded in her complaint, without providing factual detail about why the father’s plan does not provide coverage, they do not make Aetna’s liability plausible.” The Eleventh Circuit also quickly rejected Mendoza’s arguments that the COB provision did not apply to newborn care and that the district court had impermissibly converted Aetna’s motion to dismiss into a motion for summary judgment. All was not lost for Mendoza, however: “[T]he same deficiencies that require dismissal also counsel in favor of permitting amendment.” The court noted that Mendoza could allege specific facts demonstrating that the father’s birthday fell later in the calendar year, or that the father’s insurance plan did not provide coverage, and that either of these “could have supplied the factual content necessary to nudge Mendoza’s claim from possible to plausible[.]” Thus, the court reversed and remanded in order to allow Mendoza to file an amended complaint, but cautioned that such a complaint “should allege specific facts,” “must be undertaken in good faith,” and should include a copy of the father’s plan. Surprisingly, this fairly straightforward decision spawned two concurrences. Judge Newsom “wr[o]te separately only to say that I think Dina Mendoza’s complaint was probably good enough to begin with,” but “because neither party attached the father’s insurance plan to their pleadings – which would presumably resolve the primary-carrier question – I have no objection to a remand for amendments.” Meanwhile, Judge Kidd agreed that Mendoza should be given leave to amend, but “for different reasons than my colleagues.” Judge Kidd contended that the district court erred by using the Eleventh Circuit’s Blankenship test to evaluate Mendoza’s complaint because that test “governs how courts review benefit-denial decisions, not how courts review whether a plaintiff has plausibly pleaded an ERISA claim.” As a result, Judge Kidd concluded that the district court had demanded too much from Mendoza. In the end, Mendoza will get another chance to plead her claim against Aetna, even if the Eleventh Circuit can’t agree why.
Pension Benefit Claims
Second Circuit
Seyboldt v. Linde, Inc., No. 3:23-CV-00209 (SRU), 2026 WL 788007 (D. Conn. Mar. 20, 2026) (Judge Stefan R. Underhill). Ann Seyboldt began working for Linde, Inc. in 1999 as a temp worker through a third-party employment agency. In 2003, she was directly hired by the company. Seyboldt contends that she was a common-law employee of Linde as of 1999 and thus eligible to participate in the company’s pension plan from that date forward. However, she alleges that she was not informed of her eligibility to participate in the plan under the legacy provisions, which she contends included her as a “common law employee,” when the plan was amended in 2002. Instead, the first plan document she saw was the 2003 summary plan description (SPD), which she received after her direct hire and used different language. In 2016 and 2019, Seyboldt inquired about her service credit, and in 2020, she was informed that her inquiry was being treated as a claim for benefits. That claim was denied on the ground that Seyboldt was not considered an employee during the relevant period. Seyboldt unsuccessfully appealed and then brought this action, alleging seven ERISA claims against Linde, the plan, and the plan’s administrative committee. After removing the case to federal court, and an amendment by Seyboldt, defendants filed a motion to dismiss. Seyboldt agreed to the dismissal of Linde as a defendant as well as three of her claims, so the court addressed the remaining claims. First, the court found that Seyboldt’s claims under ERISA § 502(a)(1)(B) were not barred by the six-year statute of limitations because the 2003 SPD did not constitute a clear repudiation of her entitlement to benefits. The SPD inaccurately summarized the plan’s eligibility criteria, and Seyboldt alleged that she did not learn of her eligibility until 2020, and thus her complaint, filed in 2022, was timely. Next, the court rejected defendants’ argument that the breach of fiduciary duties claim was duplicative, as plaintiffs are allowed to plead in the alternative. Furthermore, the court found it timely under ERISA’s six-year statute of repose because “the alleged breach is ongoing… Defendants still do not recognize Seyboldt’s service from December 1999 to December 2003.” Even if the breach were not ongoing, the court considered the date defendants finally denied Seyboldt’s claim as “the last action” for timeliness purposes, and that did not occur until 2020. Finally, the court concluded that Seyboldt plausibly claimed the 2003 SPD inaccurately summarized the plan’s eligibility criteria, misleading her about her rights and obligations under the plan. This constituted a violation of 29 U.S.C. § 1022, which requires SPDs to be “sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” As a result, while Seyboldt agreed to dismiss some of her claims, and Linde as a defendant, she prevailed on all her remaining claims and the case will continue.
Sixth Circuit
Moshos v. Southwest Ohio Regional Council of Carpenters Pension Fund, No. 3:24-CV-165, 2026 WL 785035 (S.D. Ohio Mar. 20, 2026) (Judge Michael J. Newman). Kenneth Moshos is a carpenter, a member of the Southwest Ohio Regional Council of Carpenters, and a participant in the Southwest Ohio Regional Carpenters Pension Plan, an ERISA-governed multiemployer retirement plan. In 2014, at age 54, he elected to retire and begin receiving early retirement benefits under the plan. However, his early retirement benefits were suspended after he resumed work as a carpenter. (The plan required suspension of benefits for those working in the industry before reaching normal retirement age.) Moshos’ benefits remained suspended for over six years, through July of 2021. When Moshos reached his normal retirement age of 62, he applied for normal retirement benefits. However, he was informed that “his application for a pension benefit had been ‘approved’ but only for the lower amount of his early retirement benefit rather than the higher amount of his normal retirement benefits.” Moshos filed this action against the pension fund and its board of trustees challenging this decision. The parties filed cross-motions for judgment which were adjudicated in this order. The court reviewed the decision under the arbitrary and capricious standard of review because the plan granted the board discretionary authority to determine eligibility for benefits. Moshos argued that ERISA prohibited the forfeiture of his accrued normal retirement benefits and challenged the decision to pay him the reduced early retirement benefits instead of the full normal retirement benefits upon reaching normal retirement age. Defendants contended that its decision should be upheld because it was “a straightforward application” of the plan. The court ruled that the board’s decision failed to comply with ERISA’s non-forfeitability provisions and the Department of Labor’s suspension regulation, 29 C.F.R. § 2530.203-3(a). In so ruling, the court relied on the Sixth Circuit’s decision in Reichert v. Kellogg Co. (our case of the week, see above), which was issued only four days earlier. The court reasoned that the suspension regulation allows for the suspension of early retirement benefits only if it does not affect a retiree’s entitlement to normal retirement benefits or their actuarial equivalent. The court concluded that the board’s decision significantly reduced the total amount of benefits Moshos would receive over his lifetime, thus violating ERISA. Defendants contended that this interpretation “would effectively allow any early retiree in any defined benefit pension plan to reap windfall benefits at any time by participating in a minimal amount of Disqualifying Employment just before his normal retirement age.” However, the court minimized this concern, noting that such conduct would not significantly change the calculation of benefits. The court thus concluded that the board’s decision violated ERISA and was arbitrary and capricious. However, it did not rule in Moshos’ favor. The court noted that its analysis was predicated in part on its interpretation of Reichert, which the parties were not able to discuss in their briefs. As a result, the court denied both parties’ motions without prejudice and referred the case to mediation. If mediation is not successful, the parties will return to the court and file briefing addressing Reichert and the court’s order.
Eighth Circuit
Landel v. Olin Corp., No. 4:25-CV-00096-CMS, 2026 WL 785044 (E.D. Mo. Mar. 20, 2026) (Judge Cristian M. Stevens). Incredibly, this is our third case this week addressing the issue of “actuarial equivalence.” At issue is the Olin Corporation Employees’ Pension Plan, which is an ERISA-governed defined benefit plan. The plan offers two default types of pension benefits: single life annuities (SLAs) for single employees and joint and survivor annuities (JSAs) for married employees. JSAs provide a monthly benefit for the life of the participant and, upon their death, a benefit for the life of the participant’s spouse. The plan uses actuarial assumptions, including a steep 9.2% discount rate and the 1983 Group Annuity Mortality Table, to convert SLAs into “equivalent” JSAs. Plaintiffs Lou Ann Landel and Alvin L. Lewis are participants in the plan who are receiving benefits calculated under these assumptions. They contend that their benefits are lower than they should be because these assumptions are outdated. They filed this action against Olin and the plan’s administrative committee alleging (1) violation of 29 U.S.C. § 1055 by failing to use updated actuarial assumptions, thus not meeting ERISA’s “actuarial equivalence” requirement, and (2) breach of fiduciary duty under 29 U.S.C. §§ 1104 and 1106 “by using outdated actuarial figures to enrich themselves.” Defendants filed a motion to dismiss. At the outset, the court rejected defendants’ statute of limitations argument. The plan had a two-year limitation period which began running “after the individual receives information that constitutes a clear repudiation of the rights the individual is seeking to assert.” However, this limitation did not apply because plaintiffs “never experienced” such an event; “they do not claim that their rights under the Plan have been violated. Rather, Plaintiffs claim that the Plan as written violates the guarantees of ERISA… Thus, the Plan’s two-year limitations period does not apply here.” Turning to count one, the court ruled that plaintiffs’ interpretation of “actuarial equivalence” “is not supported by a plain reading of the text of 29 U.S.C. § 1055.” The court noted that ERISA does not define “actuarially equivalent” and assumed Congress intended the term to have its established meaning, which is that “[t]wo modes of payment are actuarially equivalent when their present values are equal under a given set of actuarial assumptions.” The court concluded that the plan’s use of a 9.2% interest rate and the 1983 Group Annuity Mortality Table met this definition. The court emphasized that ERISA “does not impose a substantive standard beyond actuarial equivalence” and that Congress did not include a reasonableness requirement in the relevant sections of ERISA. As for count two, the court determined that Olin did not have fiduciary duties because the named fiduciary of the plan was the committee, not Olin. The court further found that plaintiffs did not adequately allege a derivative breach of fiduciary duty by Olin or an underlying breach by the committee because the plan’s actuarial assumptions were permissible under ERISA, as discussed above. As a result, the court granted defendants’ motion to dismiss, with prejudice. This ruling is obviously contrary to the Sixth Circuit’s decision in Reichert (see above), so we expect to see this case make its way up to the Eighth Circuit.
Plan Status
Second Circuit
Coveny v. Cablevision Lightpath, LLC, No. 25-CV-1214-SJB-JMW, 2026 WL 787880 (E.D.N.Y. Mar. 20, 2026) (Judge Sanket J. Bulsara). Kevin Coveny was employed as a project manager for Cablevision Lightpath, LLC. In May of 2024, during a phone call with two vice presidents and a manager, Coveny requested additional time to review his projects in order to provide a status update. Following the meeting, one of the vice presidents “berated” him, which Coveny alleges led to health issues, including heart palpitations and chest discomfort. His cardiologist recommended a medical leave of absence, which Coveny took. While on leave, Coveny learned that Lightpath had introduced a Voluntary Retirement Incentive Program (VRIP). The VRIP was available to employees who were at least 60 years old, had at least ten years of service, and were in good standing. Employees on approved leave were eligible to participate. Coveny emailed Lightpath’s human resources department about the program, but was told that he was not eligible because “he was not in good standing.” In November of 2024, while still on leave, Coveny was terminated when his short-term disability leave transitioned to long-term disability. Coveny then filed this action, asserting three claims against Lightpath: (1) violation of ERISA § 510, (2) violation of ERISA § 502, and (3) disability discrimination in violation of the New York State Human Rights Law (NYSHRL). Lightpath moved to dismiss the ERISA claims, contending that the VRIP was not an employee welfare benefit plan under ERISA. At the outset, the court noted that “[t]he law in the Second Circuit is unclear as to whether the failure to allege an ERISA-covered ‘employee welfare benefit plan’ is a jurisdictional defect or merits pleading failure.” Regardless, the court applied “three non-exclusive factors” to determine whether the VRIP constituted an ERISA-governed severance plan: “(1) whether the employer’s undertaking or obligation requires managerial discretion in its administration; (2) whether a reasonable employee would perceive an ongoing commitment by the employer to provide employee benefits; and (3) whether the employer was required to analyze the circumstances of each employee’s termination separately in light of certain criteria.” The court found that the VRIP required little managerial discretion, as it involved a one-time, lump-sum payment based on explicit eligibility requirements and simple calculations. The court rejected Coveny’s argument that determining “good standing” required significant discretion, characterizing the discretion involved in determining “good standing” as “minimal.” The court also determined that no reasonable employee would perceive the VRIP as an ongoing commitment, as it offered a one-time payment without ongoing administrative requirements. Lastly, the court concluded that the VRIP did not require individualized analysis beyond simple calculations. The court debated what to do: “Although it is not clear whether such a dismissal should be on subject matter jurisdiction or merits grounds…the Court must make a choice between the two because it impacts the form of dismissal.” The court determined that “the failure is one on the merits – a failure to plead the necessary elements for such recovery.” As a result, it dismissed the claim with prejudice. The court declined to exercise supplemental jurisdiction over Coveny’s state law NYSHRL claim, and the case was closed.
Pleading Issues & Procedure
Eighth Circuit
Rivera v. Sedgwick Claims Mgmt. Servs., No. 24-CV-3247 (LMP/SGE), 2026 WL 788209 (D. Minn. Mar. 20, 2026) (Judge Laura M. Provinzino). In our July 16, 2025 edition we discussed this case brought by pro se plaintiff Ezequiel Rivera which arose out of an on-the-job injury he suffered while working in Wisconsin for Nestle, USA, Inc. He alleged that defendants Ace Fire Underwriters Insurance Company and Sedgwick Claims Management Services, Inc. conspired to deny him benefits, and asserted claims against them under ERISA, Title VII of the Civil Rights Act, and the Americans with Disabilities Act. Last year the court granted defendants’ motion to dismiss, ruling that Rivera did not properly allege the existence of an ERISA-governed plan, and furthermore, venue was not proper in Minnesota because the events giving rising to the suit all occurred in Wisconsin (where Mr. Rivera had already filed multiple other lawsuits that had all been dismissed). Rivera was undaunted. He moved to alter or amend the judgment under Federal Rule of Civil Procedure 59(e), and moved to disqualify the judge pursuant to 28 U.S.C. § 455(a). The court denied both of these motions in September of 2025. Rivera also appealed to the Eighth Circuit; that appeal is pending. Now, Rivera has filed a motion for relief from judgment under Federal Rule of Civil Procedure 60(b). The basis for Rivera’s motion was that a decision by the Wisconsin Labor and Industry Review Commission (WLIRC) “awarded Rivera $18,737.95 in wrongfully withheld disability benefits,” which constituted “newly discovered evidence.” Rivera asked to either amend his complaint or transfer the case to Wisconsin. The court denied Rivera’s motion. First, the court ruled that the WLIRC decision did not qualify as newly discovered evidence under Rule 60(b)(2) because it was not in existence at the time the judgment was entered. Furthermore, the decision did not justify extraordinary relief under Rule 60(b)(6) because it did not affect the court’s original decision to dismiss the case. The court noted that Rivera’s ERISA claim was dismissed because he failed to plead the existence of a plan, and the WLIRC decision did not address this issue. As for his retaliation claims, the WLIRC decision was irrelevant because “the Court did not dismiss Rivera’s claims because they lacked merit; the Court dismissed those claims because they were not properly brought in this District.” Furthermore, Rivera had already made the same argument regarding the WLIRC decision in one of his Wisconsin cases, and the court there had rejected it. Thus, “transferring the case would end with the same result: dismissal.” As a result, the court denied Rivera’s motion, declaring, “This case is therefore over.” We will see if Rivera agrees.
Ninth Circuit
Gadberry v. Life Ins. Co. of N. Am., No. 2:25-CV-00391-BLW, 2026 WL 765698 (D. Idaho Mar. 18, 2026) (Judge B. Lynn Winmill). Nathan Gadberry, who suffers single-sided deafness with an auditory processing disorder, was approved for benefits under an ERISA-governed long-term disability benefit plan by the plan’s insurer, Life Insurance Company of North America (LINA). However, LINA terminated those benefits, and after an unsuccessful appeal, Gadberry filed this action. Gadberry originally named LINA as the sole defendant, asserting one claim for plan benefits under ERISA. However, in this motion he sought to amend his complaint to add claims and defendants. He proposed four new defendants: New York Life, his employer (Science Applications International Corporation (SAIC)), SAIC’s Benefits Committee, and SAIC’s Health and Welfare Benefits Plan. Gadberry’s proposed complaint contained three claims for relief: (1) plan benefits pursuant to 29 USC § 1132(a)(1)(B); (2) “appropriate equitable relief, declaratory relief, reformation, equitable surcharge, [and] injunctive relief pursuant to 29 U.S.C. § 1132(a)(3)”; and (3) in the alternative, similar equitable relief under 29 U.S.C. § 1132(a)(3) and/or 29 U.S.C. § 1132(a)(1)(B). LINA contended that the new claims under Section 1132(a)(3) were “unnecessary,” but did not oppose Gadberry’s motion to add them. However, LINA did object to the addition of New York Life as a defendant, arguing that “this entity ‘played no role in Plaintiff’s LTD claim or its appeal.’” LINA submitted a declaration to this effect, but the court ignored it because “[a]t this procedural stage, the Court’s task is to simply determine whether the proposed amended pleading satisfies Rule 8 by setting forth a cognizable legal theory supported by factual allegations.” It turned out that the declaration was unnecessary, because the court ruled that “Gadberry has failed to plausibly allege claims against New York Life.” The court found that the proposed amended complaint did not plausibly allege that New York Life exercised control over the plan or acted in a capacity that would subject it to liability under ERISA. The court noted that the complaint “contains a single allegation addressing the role of New York Life” in which Gadberry contended that New York Life “controlled the disability insurance policy/plan at issue in this case.” The court ruled that this was conclusory and “does not provide sufficient factual detail.” Furthermore, “the proposed amended complaint’s broader allegations obscure rather than clarify the identity of who did what.” For similar reasons, the court also found that the proposed amended complaint failed to plausibly assert claims against New York Life under ERISA § 502(a)(3) due to the lack of factual allegations supporting an inference that New York Life sufficiently exercised discretion in the denial of Gadberry’s claim to make it a fiduciary under ERISA. Thus, the court denied Gadberry’s motion to the extent he sought to add New York Life as a defendant. The denial was without prejudice, however; the court allowed Gadberry an opportunity to file a revised, proposed amended complaint to cure the identified deficiencies.