Dwyer v. Unum Life Ins. Co. of Am., No. 19-4751, 2021 WL 2853250 (E.D. Pa. July 8, 2021) (Judge Gerald Austin McHugh).

The court reviewed Unum’s denial of Colleen Dwyer’s long-term disability (LTD) benefits under the de novo standard of review and determined that plaintiff had shown by a preponderance of evidence that she was disabled under the terms of her plan and was entitled to retroactive reinstatement of her benefits.

Dwyer had previously been diagnosed with Meniere’s disease, which caused symptoms including nausea and vertigo, and then had both legs amputated below the knee. Despite these conditions, plaintiff continued to work for many years until her Meniere’s disease symptoms worsened in 2018, and she took disability leave. Although Unum had at first approved Dwyer’s claim for short-term benefits, and her employer had paid these benefits for six months, when she applied for long-term benefits, Unum reversed course. It not only denied her LTD claim, but asserted that she had not even been entitled to short-term benefits and thus had not been disabled during the plan’s “elimination period.”

The court disagreed, concluding that the evidence established that Dwyer “suffered a worsening of her condition that significantly affects her ability to function.” The court “augmented” its review of the evidence by reference to “specific provisions that Unum agreed to incorporate into its handling of claims pursuant to a settlement it reached” in 2004 “following litigation with several public authorities,” including Unum’s agreement to give significant weight to the opinions of treating physicians and to an award of Social Security benefits, and its agreement to consider the impact of multiple conditions.

Plaintiff’s evidence included medical records and doctor’s notes, referrals to several specialists, as well as a letter from her psychologist who opined she was unable to work and explained how psychiatric symptoms she experienced were related to and triggered by her physical symptoms. Not surprisingly, the court found the “fact that Plaintiff’s legs are amputated below the knees” to be “[o]f critical importance,” making it clear how Dwyer’s Meniere’s disease,” which “leads to dizziness, vertigo, and lack of balance would be physically disabling to someone with these amputations, and how the fear of falling and anxiety surrounding the condition would lead to disabling psychological distress such as that reported here.”

Given these stark realities, the court rejected as unpersuasive or unfounded each of Unum’s attempt to rebut this evidence. For instance, Unum’s peer reviewers cited a lack of escalation of treatment and low use of medication. The court was not persuaded, explaining that plaintiff had reached a “plateau” where medication’s efficacy was limited, and other treatment options were invasive and potentially dangerous. Unum’s peer reviewers also claimed plaintiff’s treating physicians did not document any direct observations of active Meniere’s symptoms, but the court found this was contradicted by the record.

In addition, the court took Unum to task for its “surveillance” of Dwyer, concluding that Unum “has gone to extremes in scouring Plaintiff’s social media for any sign of normal life activity.” When Unum pointed to normal life activities such as plaintiff preparing salads for meals as evidence that plaintiff was not disabled, the court agreed with plaintiff’s counsel that this argument was “so patently absurd that it nearly does not merit a response.” The court also pointed out that Unum’s reviewing doctors did not evaluate plaintiff in person and did not adequately recognize the worsening of her condition and the combined effect of her multiple conditions. More generally, the court concluded that Unum “attache[d] far too much significance to Plaintiff’s prior success in coping with her limitations, and unrealistically minimizes the impact of her worsening condition.”  Finally, the court gave weight to the fact that plaintiff’s Social Security disability claim was approved, even though Unum had not considered the approval because the approval was received after Unum had denied plaintiff’s claim.

Although Unum asked the court to remand the claim, the court declined to do so, concluding that the “appropriate remedy is the granting of LTD benefits which Plaintiff was due under the Plan for twenty-four months after she became eligible on August 5, 2018.” Any gap in the evidentiary record as to the continuing nature of Dwyer’s disability was because Unum “improperly denied her benefits in the first place.” “In real world terms, to adopt Defendant’s position here and grant a full remand would render litigation by claimants such as Plaintiff a virtual impossibility, because such claimants would repeatedly have to climb a steep mountain only to return to its base again and again in seeking benefits due under a disability plan.”

All in all, there is a lot for ERISA plaintiffs and their lawyers to love in this decision, which was litigated on behalf of Ms. Dwyer by ERISA Watch subscriber Adam Garner.

Happy Bastille Day everyone.

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

Attorneys’ Fees

Tenth Circuit

Lorraine M. Ramos, et al. v. Banner Health, et al., No. 15-cv-2556, 2021 WL 2823079 (D. Colo. July 7, 2021) (Judge William J. Martinez).  In this class action, plaintiffs prevailed on some of their claims which alleged breach of fiduciary duties related to the Banner Health Employees 401(k) Plan. The court awarded losses and prejudgment interest to the plaintiffs in the amount of $3,131,081.62.  Plaintiffs sought attorney fees of $5,286,413.60, costs of $108,564.98 and that the named class representatives each receive a $15,000 incentive award. The court found that plaintiffs’ billing records and hours do not reflect any semblance of billing judgment.

The hours are “wildly excessive” and include a large number of hours for redundant tasks. As an example the court noted that an attorney billed 24 hours in a single day and 64 hours over 3 days. The court criticized the use of block billing, rather than .10 hour increments. Plaintiffs also tasked senior attorneys with work that could have been accomplished by more junior attorneys. In rendering this criticism, however, the court suggested that senior attorneys should not have been used for depositions, experts, pre-trial and trial. The court also explained that a 100% fee award would be inconsistent with the success obtained as the court rejected several of plaintiffs’ key theories. Ultimately, the court awarded plaintiffs 20% of their total attorney fees.  The court also found the costs to be “grossly excessive” and awarded the same 20%.  As to incentive awards, the court granted the two named plaintiffs who personally attended the trial a larger amount than the other named class members.

Breach of Fiduciary Duty

Sixth Circuit

Carter v. The Lincoln National Life Ins. Co., No. 220CV02921SHMATC, 2021 WL 2877912 (W.D. Tenn. July 8, 2021) (Before District Judge Samuel Hayes). Plaintiff filed suit after his claim for long term disability benefits was denied. Defendant Lincoln National not only filed an answer, but brought a counterclaim against plaintiff for failure to reimburse defendant for offsetable funds later recovered, allegedly in accordance with the terms of the policy. Defendant asked that a constructive trust be imposed on any benefits received from Lincoln National or the SSA. Defendant brought a motion to dismiss Plaintiff’s claim for Breach of Fiduciary Duty which were brought along with his claims under 1132(a)(1)(B). Defendant argued that the claim must be dismissed because the alleged injury (denial of benefits) can only be remedied under a claim under 1132(a)(1)(b). Plaintiff asserted that the claim for breach of fiduciary duty was brought as an alternative to the benefit claim. The court found that Plaintiff failed to plead facts to prove a separate injury which would justify a Breach of Fiduciary Duty claim. As such, the Court granted Defendant’s motion and dismissed Plaintiff’s claim under 1132(a)(3).

Class Actions

Fourth Circuit

Feinberg v. T. Rowe Price Grp., No. JKB-17-0427, 2021 WL 2784614 (D. Md. July 2, 2021) (Judge James K. Bredar). As part of this complex class action, plaintiffs filed a motion to certify an interlocutory appeal on the narrow question of whether certain language in defendant’s retirement plan was void under ERISA. Plaintiffs argued that a “hardwiring amendment” in the plan that required the trustees to offer only T. Rowe Price funds in the plan was in violation of § 1110(a) of ERISA. The court denied plaintiffs’ motion, finding that plaintiffs had failed to meet two of the three factors required to justify certification of an interlocutory appeal. The court explained that plaintiffs had failed present “extraordinary circumstances” because plaintiffs did not identify a controlling question of law, as the parties’ disagreement over the language of the hardwiring amendment implicated factual disputes. In addition, the court determined that an appeal would not materially advance the termination of this litigation. The court did not analyze the third factor of whether there was substantial ground for a difference of opinion regarding the lawfulness of the hardwiring amendment since the other two other factors were not met. 

Disability Benefit Claims

Third Circuit

Dwyer v. Unum Life Ins. Co. of Am., No. 19-4751, 2021 WL 2853250 (E.D. Pa. July 8, 2021) (Judge Gerald Austin McHugh). The court reviewed defendant’s denial of plaintiff’s long term disability benefits under the de novo standard of review and determined that plaintiff had shown beyond a preponderance of evidence that she was disabled under the terms of the plan and was entitled to retroactive reinstatement of her benefits. Plaintiff had previously had both legs amputated below the knee and had been diagnosed with Meniere’s disease which caused symptoms including nausea and vertigo. Plaintiff had functioned for many years until her Meniere’s disease symptoms worsened and she took disability leave. Plaintiff’s evidence included medical records and doctor’s notes, referrals to several specialists, as well as a letter from her psychologist who opined she was unable to work and explained how psychiatric symptoms she experienced were related to and triggered by physical symptoms. Unum’s peer reviewers cited a lack of escalation of treatment and low use of medication; however, the court was not persuaded, explaining that plaintiff had reached a “plateau” where medication’s efficacy was limited, and other treatment options were invasive and potentially dangerous. Unum’s peer reviewers also claimed plaintiff’s treating physicians did not document any direct observations of active Meniere’s symptoms, but the court found this was contradicted by the record. In addition, Unum conducted social media “surveillance” and pointed to normal life activities such as plaintiff preparing salads for meals, and the court agreed with plaintiff in finding that Unum’s attempt to use this as a reason to deny disability benefits was “so patently absurd that it nearly does not merit a response.” The court noted Unum’s reviewing doctors did not evaluate plaintiff in person and did not adequately recognize the worsening of her condition and the combined effect of her multiple conditions. The court also gave weight to the fact that plaintiff’s Social Security disability claim was approved, even though Unum had not considered the approval because the approval was received after Unum had denied plaintiff’s appeal.

Sixth Circuit

Holden v. Unum Life Ins. Co. of Am., No. 20-6318, 2021 WL 2836624 (6th Cir. July 8, 2021) (Circuit Judge Bernice Bouie Donald; Before Gibbons, Cook, and Donald, Circuit Judges). Plaintiff appealed the denial of long term disability benefits and district court judgment in favor of Unum. The court applied an arbitrary and capricious standard of review. The court found Unum’s decision was rational and it is possible to offer a reasonable explanation for the denial, not whether it was the most reasonable decision. The court found Unum evaluated a comprehensive medical record and was reasonable in using its discretion in not conducting a separate exam of Holden. The court found that Unum’s decisions did not materially change in reasoning. The court found no rule that because Unum approved her short term disability claim, it should have approved her long term disability claim. The court affirmed the lower court’s judgment in favor of Unum. 

Messing v. Provident Life and Insurance Company, No. 1:20-CV-351, 2021 WL 2820662 (W.D. Mich. July 7, 2021) (Judge Hala Y. Jarbou). Plaintiff, a former managing partner at a law firm, had received disability benefits from Unum since 1998. He claimed to be disabled by depression—specifically that he was unable to handle the stress of being a trial attorney. In 2018, Provident found plaintiff able to work as a lawyer and terminated his benefits. After an appeal, plaintiff sued and Provident counterclaimed to recovery previous policy payments, asserting that plaintiff had misrepresented his inability to work as a lawyer. Provident’s claim was based on information, discovered after plaintiff sued, that he had done some legal work in thirteen cases between 1999 and 2013. Plaintiff never disclosed this to Provident. Under the de novo standard, the court determined plaintiff had not established he remained disabled. It did not consider the evidence of legal work because this was not in the administrative record. In essence, it weighted the report of an independent medical examiner hired by Provident, a rebuttal report from a doctor hired by plaintiff, and the conduct (or lack thereof) of plaitniff’s long-time treatment provider. The court found the IME report to be substantial in its testing and explanations. This warranted greater weight. The rebuttal report was viewed as conclusory, warranting little weight. The kicker was that in 2017 plaintiff’s treatment provider had opined he was not able to work an occupation, but in 2018 she refused to opine about his ability to work as a lawyer. Without an explanation for this change, the IME report carried the day. Turning to Provident’s counterclaim, the court ruled Provident had the burden to show that plaintiff’s purported misrepresentations induced benefit payments. However, at best, Provident showed it would have investigated the claim had it known this information. The court acknowledged that investigation may have led to a benefit denial, but it also may not have done so. Because Provident failed to establish an essential element of its restitution claim, plaintiff was entitled to summary judgment.

Eleventh Circuit

Nunnelly v. Life Ins. Co. of N. Am., No. 4:19-CV-01383-HNJ, 2021 WL 2826430 (N.D. Ala. July 7, 2021) (Mag. J. Judge Herman Johnson, Jr.). Plaintiff sued LINA in response to LINA’s denial of his claim for long-term disability benefits, and the parties filed cross-motions for judgment. LINA’s motion included a declaration from a LINA executive. Plaintiff moved to strike the affidavit because (1) the individual was not named in LINA’s initial disclosures, and (2) the declaration testimony constituted inadmissible hearsay. The court granted LINA’s motion for judgment, denied plaintiff’s motion for judgment, and granted plaintiff’s motion to strike the aspects of the declaration which commented upon claim handling specifics, as that went beyond the certification of the administration record. The court rejected the argument that the declaration constituted hearsay, holding that the declaration certified and authenticated the claim file as required by Federal Rules of Evidence 803(6) and 902(1). Regarding the merits of the case, the court concluded that the medical records, opinions of plaintiff’s treating physicians, and opinions of LINA’s medical reviewers did not demonstrate that plaintiff remained continuously unable to work throughout the relevant period.

Discovery

Seventh Circuit

Stone v. Signode Indus. Grp. LLC, No. 1:17-CV-5360, 2021 WL 2894159 (N.D. Ill. July 9, 2021) (Mag. J. Susan E. Cox). This is a class action by employees of a packaging plant against the plant and related entities alleging that the plant assumed an obligation to pay ERISA-governed health-care benefits to retirees. The plant terminated the plan, stopped paying benefits, and the employees sued. The employees won, prevailed on appeal, and are now seeking damages. They served written discovery regarding (1) “saved expenditures” and “other consequential gains” realized after defendants ceased providing benefits, and (2) “injunction compliance” regarding the restoration of benefits. Defendants objected, and the employees filed a motion to compel. On the first issue, the magistrate judge ruled in favor of the employees. The court noted that defendants’ arguments were largely merits-based – i.e., that the employees were not entitled to the extra-contractual relief to which the discovery was relevant. However, the court found that these arguments were improper on a discovery motion, which only evaluates the relevance of the requested information. On the second issue, the court ruled in favor of defendants. The court characterized the employees’ discovery as a “fishing expedition” to explore whether defendants were complying with the injunction against them. The court found this improper, stating, “Plaintiffs are attempting to accomplish through standard discovery what should be attempted through post-judgment enforcement proceedings before the District Judge.”

ERISA Preemption

Fifth Circuit

Burns v. Guardian Life Ins. Co. of Am., No. CV 20-1496, 2021 WL 2815980 (W.D. La. July 6, 2021) (Judge S. Maurice Hicks, Jr.). Guardian filed a motion to dismiss on ERISA preemption grounds, which was not opposed by the plaintiff. The court granted the motion, agreeing that plaintiff’s claim for breach of contract was preempted by ERISA. The court applied a two-pronged test to determine whether a state law relates to an employee health benefit plan for the purposes of ERISA preemption. First the court asks whether the state law claims address areas of exclusive federal concern, such as the right to receive benefits under the terms of an ERISA plan, and then turns to whether the claims directly affect the relationship among the traditional ERISA entities—the employer, the plan, its fiduciaries, and the participants and the beneficiaries. Plaintiff’s claim to recover interest and “all sums reasonable” under La. R.S. 22:9082 was founded upon his claim for unpaid benefits which affects traditional ERISA entities. The interest claim centered upon whether plaintiff had a right to receive benefits under the terms of an ERISA plan, and courts have consistently found such a claim to be preempted. As result, the court ruled that plaintiff’s claims to recover interest and “all sums reasonable” were expressly preempted.

Ninth Circuit

Mabry v. ConocoPhillips, No. 3:20-CV-00039-SLG, 2021 WL 2805358 (D. Alaska July 6, 2021) (Judge Sharon L. Gleason). Plaintiff moved for reconsideration of the court’s prior dismissal of defendant Alight Solutions, LLC and granted the motion consistent with the recent Ninth Circuit decision in Bafford v. Northrop Grumman which held that state law claims for professional negligence and negligent misrepresentation for providing misinformation about pension benefits are not preempted by ERISA. Because the court found the state law claims are not preempted it analyzed whether plaintiff had alleged sufficient facts that he is a third-party beneficiary to the contract between Alight and ConocoPhillips for his professional negligence claim. The court ruled plaintiff’s complaint sufficiently alleges he was a third-party beneficiary to the contract because certain services are rendered directly to the plan participants such as preparing pension benefit statements, processing pension applications and deciding first-level benefit appeals. Alight also argued that plaintiff cannot allege justifiable reliance as a matter of law because plaintiff knew a portion of his benefits were payable to his ex-spouse and because there were disclosures in the statements stating they were only “estimates.” The court disagreed finding the allegations sufficient because plaintiff had received two letters stating his ex-spouse’s benefit would be segregated from his, he further alleged he made employment, savings and spending choices based on the pension estimates and Alight provided no precedent to show that plaintiff’s reliance on the estimates in planning his retirement were unreasonable.  The court also agreed, in line with Bafford, that an online request for a benefit statement may suffice as a “written request” under ERISA § 105.

Exhaustion of Administrative Remedies

Sixth Circuit

Sullivan v. Nissan Supp. Ex. Ret. Pl., No. 3:20-CV-00752, 2021 WL 2809113 (M.D. Tenn. July 6, 2021)(Judge Eli Richardson) In this dispute over Supplemental Executive Retirement Plan benefits, defendants filed a motion to dismiss plaintiff’s lawsuit for failure to exhaust administrative remedies. Plaintiff argued defendants did not follow the claims procedures in the plan and therefore he should not be required to exhaust administrative remedies. Among other procedural irregularities, defendants sent plaintiff a purported denial letter which did not inform plaintiff of his right to appeal or how to do so. Because defendants did not follow the plan’s claims procedures, the court deemed plaintiff to have exhausted his administrative remedies. In court then denied defendants’ request to remand the claim back to the plan as not appropriate considering that defendants had not complied with the plan’s claims procedures while handling the claim initially. The court found that since administrative remedies had already been exhausted a remand was not mandatory, and there was no indication defendants would handle the claim properly on remand. 

Life Insurance & AD&D Benefit Claims

Ninth Circuit

Cho v. First Reliance Standard Life Ins. Co., No. 20-55314, __ Fed.App’x __, 2021 WL 2885855 (9th Cir. July 9, 2021) (Before Circuit Judges Callahan and Forrest, and District Judge Richard Seeborg). First Reliance appealed from the district court’s order awarding Cho the full amount of her dependent spouse’s life insurance benefits. First Reliance contended no benefits were due because the insured did not provide evidence of insurability. The district court ruled that First Reliance had waived this requirement, citing Salyers v. Metropolitan Life Ins. Co., 871 F.3d 934 (9th Cir. 2017). First Reliance argued that Salyers did not apply because the plan had a non-waiver clause. The court agreed that the “Effective Date of Dependent Insurance” clause emphasized the evidence of insurability requirement so clearly that no reasonable person would doubt proof of good health was a necessary condition to coverage. However, the court found that Cho was entitled to the benefits for which she paid. For over a year defendants accepted her premiums without any submission of evidence of insurability though it “knew or should have known” the terms of the plan required such evidence. Defendants’ actions were “so inconsistent with an intent to enforce” the requirement that it was reasonable for Cho to believe she was not required to submit such evidence. The insertion of a non-waiver clause in the operative policy did not displace this conclusion: “Allowing insurers like First Reliance essentially to vitiate Salyers and the good behaviors it seeks to promote by including one sentence in their plans would be unfair and unjust.” The court further ruled that First Reliance could not maintain a claim for contribution or indemnification against Cho’s employer, noting that ERISA does not provide for “an equitable remedy of contribution in favor of a breaching fiduciary.” In enacting ERISA, there was no indication that Congress intended to “soften the blow on joint wrongdoers.”

Bircher v. Metropolitan Life Insurance Company, No. 20-55608, 2021 WL 2885845 (9th Cir. July 9, 2021) (before D.M. Fisher, Watford, and Bumatay, Circuit Judges). Plaintiff sought supplemental life insurance benefits under a plan sponsored by AT&T. The district court ruled against her. She appealed. The SPD stated the life insurance benefits ended upon termination of employment, except for eligible former employees of AT&T West. Plaintiff contended the deceased was part of AT&T West by virtue of being employed by AT&T within the Nevada and California region. AT&T asserted decedent was an employee of AT&T Corp, not AT&T West. The court did not find plaintiff’s geographic based argument persuasive, nor did the argument rebut the district court’s factual finding on this issue. The court also did not mind that MetLife had lost the 1988 SPD that was in effect at the time of decedent’s retirement or that MetLife may have committed various procedural violations that had no impact on whether decedent was an employee of AT&T West. The district court’s decision was affirmed. 

Medical Benefit Claims

Second Circuit

Henkel of America, Inc. v. ReliaStar Life Ins. Co., No. 3:18-CV-00965 (JAM), 2021 WL 2857503 (D. Conn. July 8, 2021) (Judge Jeffrey Alker Meyer). Henkel sponsors a self-funded health plan which paid $50 million in prescription drug costs for two of its employees. This suit was filed after ReliaStar, the stop-loss carrier, refused to pay Henkel for these prescription costs. Express Scripts, a company contracted to perform review of prescriptions, including interpretation and review for plan compliance, safety and efficacy and clinical appropriateness. Express Scripts moved for summary judgment which the court denied finding issues of material fact that should proceed to a jury to determine whether Express Scripts, and its affiliate, was conducting appropriate reviews including approval of the prescriptions based on prior authorization policies without confirming lab results and whether it knew that the prescriptions were incorrect or inappropriate for the participants.

Pension Benefit Claims

Seventh Circuit

Local 705 Int’l Bhd. of Teamsters Pension Fund v. Pitello, No. 20-2142, — F.4th —- 2021 WL 2818326 (7th Cir. Jul. 7, 2021) (Judges Wood, Lefkow, and Easterbrook)   Gradei’s Express Co. withdrew from the Local 705 International Brotherhood of Teamsters Pension Fund. Generally companies who withdraw from multi-employer funds must pay a penalty.  It argued that it did not have to contribute further upon withdrawal because it had ceased all operations, and filed bankruptcy. Both the trial court and the appellate court agreed that where the owners of Gradei’s were still in business in other operations which it had used to further Gradei’s business as well, that was sufficient to establish common control of them, demonstrating that Gradei’s business was under common control with the other businesses, and the owner of all the businesses was personally liable for the withdrawal fees.

Pleading Issues & Procedure

Seventh Circuit

Eastern Cent. Ill. Pipe Trades Health & Welfare Fund v. Prather Plumbing & Heating, Inc., Case No. 1:18-cv-1434, 2021 WL 2819035 (7th Cir. July 7, 2021) (Before Circuit Judges Brennan, Scudder, and Hirsch). Two ERISA-governed employee benefit funds filed suit in federal court to hold a newly formed, family-run plumbing company liable for an existing ERISA judgment on the basis that it stepped into the predecessor family company’s obligations. The funds rooted their claim in the federal common law doctrine of successor liability and contended that was enough to show their claim arose under federal law and therefore raised a federal question properly in federal court under 28 U.S.C. § 1331. The district court agreed, proceeded to the merits, and concluded it would be inequitable to hold the new entity responsible for the other’s unpaid plan contributions on a theory of successor liability. On appeal, the Seventh Circuit held that the suit required dismissal because the federal question jurisdiction statute does not itself create a cause of action and the funds failed to identify any other federal statute authorizing their action in federal court. In doing so, the appellate court found that for a case to satisfy § 1331 by “arising under” federal law, it is not enough for a plaintiff to merely call upon a constitutional provision, a federal statute, or a principle of federal common law in the complaint. The cause of action must be explicitly conferred through federal statute or implied by a judicial inference regarding Congress’s intent. The court found that although the funds cited two provisions of ERISA in their jurisdictional statement on appeal—the civil enforcement provision, 29 U.S.C. § 1132, and the provision mandating that employers contribute to multiemployer benefits plans, § 1145—neither section authorizes a lawsuit to hold a successor liable for a prior ERISA judgment. Rather, § 1132 provides a right of action for persons, including employee benefits plans, to enforce § 1145, but the funds’ complaint did not purport to hold the company liable for violating § 1145. Accordingly, the appellate court vacated the district court’s judgment and remanded with instructions to dismiss for lack of jurisdiction.

Provider Claims

Fifth Circuit

Advanced Physicians, S.C. v. Conn. Gen. Life Ins. Co., No. 3:16-CV-2355-G, 2021 WL 2857241 (N.D. Tex. July 8, 2021)(Judge A. Joe Fish) Plaintiff provided medical care to retired NFL players who are members of NFL Player Insurance Plan. Defendant is the plan administrator. After extensive correspondence between the parties to resolve disputes over whether medical care provided was treating work-related injuries and therefore excluded under the plan, plaintiff initiated this lawsuit to recover benefits due under the plan. The court found that plaintiff had not exhausted its administrative remedies available under the plan because it had not formally appealed the denial of the relevant claims, despite the informal communications between the parties. The court also determined that defendant’s interpretation of the work-related exemption and defendant’s presumption that all claims from plaintiff were work-related were consistent with the plan terms. Defendant’s denial of the claims was supported by multiple internal personnel opinions and one external entity opinion based upon a review of a sampling of medical records, which the court found to be substantial evidence. Defendant’s motion for summary judgment was granted both because of plaintiff’s failure to exhaust administrative remedies and because defendant’s decisions were not arbitrary and capricious. Judgment was entered for defendant.

Third Circuit

Dual Diagnosis Treatment Center, Inc. d/b/a Sovereign Health of Cal., et al. v. Horizon Blue Cross Blue Shield of New Jersey, et al., No. CV2015285SDWAME, 2021 WL 2886085 (D.N.J. July 9, 2021) (Judge Susan D. Wigenton). Plaintiffs are substance abuse and mental health treatment centers who provided out-of-network services to eleven patients who were insured under Defendants’ health plans. Defendants filed a motion to dismiss. The court found that it remains unclear whether plaintiffs are authorized assignees for any specific patients. The court also found it is not even clear that Dual Diagnosis alleges an injury-in-fact as the provider is not listed as being owed payments. Further, the complaint only contains vague and conclusory statements regarding plan terms that align with the alleged benefits. The court granted the motion to dismiss and permitted plaintiffs leave to file an amended complaint.

Statute of Limitations

Second Circuit

Kayser v. Guardian Life Ins. Co. of Amer., et al., 19-cv-454 (NSR), 2021 WL 2827042 (S.D. N.Y. July 7, 2021) (Judge Nelson S. Román). Plaintiff filed suit against Defendants for breach of contract, fraud and violation of ERISA. Before the Court was Defendant Guardian Life’s motion for summary judgment as to the claims against Guardian only. Defendant denied Plaintiff’s application for long-term disability. Plaintiff appealed. Defendant denied the appeal. Plaintiff conceded that the state claims as against Guardian are pre-empted by ERISA. That left the Court with only the ERISA claim at issue. Defendant argued that Plaintiff’s ERISA claim is time-barred. The Court found that Plaintiff sufficiently plead facts to put Defendant on notice that she was pursuing a breach of fiduciary duty claim and thus the Court denied Defendant’s motion for summary judgment only as to Plaintiff’s ERISA claim arising from an alleged breach of fiduciary duty pertaining to “fraud or concealment.” Co-mingled with Plaintiff’s claim for breach of fiduciary duty is a claim to recover benefits under the plan. The Court held that to the extent Plaintiff sought to have the denial of her benefits reviewed by the Court, that claim is dismissed because it is subject to the three-year statute of limitations proscribed in the plan and is therefore time-barred. Accordingly, the Court granted in part and denied in part Defendant Guardian’s motion for summary judgment.