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

Attorneys’ Fees

Seventh Circuit

Alberth v. Southern Lakes Plumbing & Heating, Inc., No. 19-CV-62, 2021 WL 2779038 (E.D. Wis. July 2, 2021) (Mag. J. Nancy Joseph). Plaintiff Alberth prevailed in his claim for a cash value payout under an ERISA-governed life insurance benefit plan, and was also awarded statutory penalties. He filed a motion for attorney’s fees, which defendant opposed. The court found that Alberth had achieved “some success on the merits” and thus passed the Supreme Court’s threshold test for an award of fees. The court further ruled that the Seventh Circuit’s five-factor test weighed in favor of awarding fees. In particular, the court highlighted that defendant had acted in bad faith “during the entire course of this litigation.”

The court found that Alberth’s attorney’s requested rate of $450 per hour was reasonable and in line with other rates charged by lawyers in the Milwaukee area. However, the court reduced the number of hours requested slightly to account for administrative tasks. Finally, the court rejected defendant’s argument that the fee should be reduced because it was disproportionate to the amount of benefits at issue, finding that any disparity was not “significant enough to warrant further scrutiny.” The court awarded fees in the amount of $59,352.24.

Breach of Fiduciary Duty

Sixth Circuit

Zahuranec v. CIGNA Healthcare, Inc., No. 1:19CV2781, 2021 WL 2665754, at *4 (N.D. Ohio June 29, 2021) (Judge Pamela A. Baker). Plaintiff alleges that Cigna “reviewed [her] medical records and failed, refused, or neglected to properly apply its own guidelines to determine medical necessity of the bariatric surgical procedure” that she underwent in December 2013. Plaintiff claims that Cigna ‘breached the terms of the insurance policy by authorizing her medical provider to perform a surgical procedure for which she did not qualify” under the Plan. Cigna asserts that plaintiff cannot assert a claim under § 502(a)(1)(B) to enforce her rights under the Plan because she fails to sufficiently allege what rights she seeks to enforce. Cigna further argues that, as a matter of law, Plaintiff is not entitled to either equitable relief or compensatory damages under ERISA § 502(a)(1)(B). The court finds that plaintiff has failed to state a claim under ERISA § 502(a)(1)(B). The premise of plaintiff’s argument is that she did not receive any “benefits” under the Plan relating to her bariatric surgery because she did not “strictly comply” with all of the requirements of Coverage Policy and, therefore, the surgery was not “medically necessary.” Plaintiff does not direct this court’s attention to any language in the Plan that defines the term “benefit” as being limited to expenses relating to “medically necessary” care, treatment, or procedures. Nor does she cite any legal authority supporting her position that this court should construe the term “benefit” in such a narrow fashion. As Cigna correctly notes, the term “benefit” is not defined in the Plan. When the terms of an ERISA plan are undefined, federal rules of contract interpretation apply and plan provisions are interpreted “’according to their plain meaning in an ordinary and popular sense.’

Class Actions

Third Circuit

Sweda v. The University of Pennsylvania, No. CV 16-4329, 2021 WL 2665722 (E.D. Pa. June 29, 2021) (Judge Gene E.K. Pratter). Plaintiffs in this class action case alleging unreasonable recordkeeping and administrative fees, filed an unopposed motion for class certification after the parties reached a settlement. The court granted the motion finding that all elements were satisfied under Rule 23(a), 23(b)(1)(A) and 23(b)(1)(B). Plaintiffs also requested preliminary approval of the class settlement which was granted under the requirements of Rule 23(e). 

Disability Benefit Claims

First Circuit

DeBold v. Liberty Life Assurance Company of Boston, No. 20-CV-11802-ADB, 2021 WL 2646677 (D. Mass. June 28, 2021) (Judge Allison D. Burroughs). In December 2001, an accident rendered plaintiff a quadriplegic. Thereafter, LTD benefits were approved and paid. In October 2018, plaintiff’s benefits decreased by $797.04. The decrease resulted from her decision to “roll over” a lump sum of roughly $106,000 from her employer pension account to her individual retirement account (IRA). Liberty Life took the position that the “rollover” transaction was income from another source, which required a decrease in plaintiff’s benefits under the plan. Plaintiff argued that because she did not directly receive any money, and there was no tax liability, she did not have any “income.” Under abuse of discretion review, the court upheld the reduction of benefits. It stated it would have reached the same decision if the de novo standard applied. This was because, as plaintiff admitted, the plan authorized the reduction in benefits. The court rejected plaintiff’s arguments that the non-taxable nature of the event was significant, and that ERISA did not control IRAs. On the former, plaintiff identified no principle of contract law or interpretation that suggested that the relevant portions of the Wachovia Plan—which she conceded authorized Wells Fargo to reduce her long term disability benefits following the rollover—were invalid or unenforceable because they resulted in a change in benefits even where there were no tax consequences. On the latter, the court offered that just because ERISA does not control plaintiff’s IRA does not mean that actions that plaintiff took in connection with her IRA—such as depositing a lump sum retirement payment into it—could not trigger reductions in her long term disability benefits under the Wachovia Plan. 

Fifth Circuit

Talamantes v. Metropolitan Life Ins. Co., Case No. 20-50953, 2021 WL 2660251 (5th Cir. June 29, 2021) (W. Eugene Davis, Circuit Judge). Plaintiff filed this ERISA suit to recover long-term disability benefits from MetLife, which denied coverage. The district court severed the coverage issue from the remaining issues in this case. The decision on coverage narrowed to whether Standard Insurance Co., the carrier for calendar year 2016, or MetLife, the carrier for 2017, provided coverage. The district court granted summary judgment in favor of MetLife and entered a final judgment dismissing the case. The district court had concluded that Standard, which had been previously dismissed, covered the claim. The Fifth Circuit reversed and remanded on appeal. The Fifth Circuit reviewed the policy language in the 2016 Standard Insurance policy. Standard’s policy stated in its insuring clause, “If you become Disabled while insured under the Group Policy, we will pay LTD Benefits according to the terms of the Group Policy after we receive Proof of Loss.” MetLife’s 2017 policy described when its insurance took effect and provided coverage when an employee was covered under a prior plan: “If You are Actively at Work on the day before the Replacement Date, You will become insured for Disability Income Insurance under this certificate on the Replacement Date.” The Fifth Circuit found that the Replacement Date was January 1, 2017, and it was undisputed that plaintiff was “Actively at Work” the day before the new policy attached. The parties agreed that MetLife would not provide coverage for benefits due if coverage was provided by Standard’s policy. However, the Fifth Circuit then found that Plaintiff met the conditions to be temporarily recovered under the specific provision in the Standard policy which excluded coverage when an employee experience a temporary recovery. The court further found that the “Effect of Temporary Recovery” clause in the Standard policy excluded coverage for long term disability benefits under the precise circumstances of the case, and thus plaintiff became insured under the MetLife policy during his temporary recovery and therefore provided coverage.

Sixth Circuit

Boersma v. Unum Life Ins. Co. of Am., No. 3:19-CV-0649, 2021 WL 2661969 (M.D. Tenn. June 29, 2021) (Judge Aleta A. Trauger). Plaintiff sued Unum claiming she was disabled by multiple conditions, including arthritis and fibromyalgia. Unum argued that it correctly denied plaintiff’s claims considering her largely unremarkable physical exams and the general lack of evidence supporting her impairment, aside from her own self-reporting and the opinions of treating physicians with preexisting relationships with plaintiff who appear to have relied on that self-reporting. 

As far as symptoms attributable solely to rheumatoid arthritis were concerned, the court viewed Unum’s arguments as potentially convincing. As multiple physicians observed, there were two factors that persuasively weighed against a conclusion that plaintiff suffered from severe arthritis: first, she lacked any persistent physical manifestations of the disease, either in the form of imaging, testing, or demonstrably limited range of motion; and, second, her condition did not appear to have been meaningfully responsive to treatments that would be expected to have at least some positive effect. 

None of the physicians who considered plaintiff disabled had offered a convincing account that explained why plaintiff suffered such severe symptoms of arthritis while failing to physically manifest signs of the disease or respond to therapies. Had plaintiff’s claim been based only on arthritis, she likely would have lost. Plaintiff, however, did not claim to be disabled solely by arthritis. 

Like many patients who suffer from chronic pain, the court recognized that plaintiff appeared to have presented a diagnostic and treatment challenge. Her treating physicians seemed to be uncertain in determining what her symptoms should be attributed to. Ultimately, though, every reviewing physician—including those whose conclusions were favorable to Unum—concluded that her symptoms, as described, were consistent with a diagnosis of fibromyalgia. 

Accordingly, the two pieces of information that most significantly undermined plaintiff’s potential arthritis diagnosis—her lack of physical manifestations and her unresponsiveness to arthritis-focused therapies—simply did not tell the court much, if anything, about the possibility that she suffered similarly debilitating pain related to fibromyalgia. Moreover, the court expressly stated it would not mistakenly assume that hard, objective, physical diagnostic tools were the only legitimate source for evaluating a patient. Indeed, it noted that one thing every physician connected to the case appeared to have agreed on, at least implicitly, was that plaintiff’s subjective account of her own symptoms was a legitimate source of information for both diagnostic purposes and the purposes of assessing limitations. 

That did not mean, of course, that a patient’s claims about her symptoms will always be determinative of contested medical questions; patients may lie or exaggerate, or they may perceive their symptoms in an inaccurate or out-of-proportion way for personal or psychological reasons. At the same time, however, Unum had not presented any evidence that suggested any other source of diagnostic information—whether testing, imaging, or something else—was so comprehensive and reliable as to render self-reporting of symptoms to be beside the point. 

In any event, the court noted plaintiff had provided more than bare assertions of her symptoms. She also corroborated their severity with narrative evidence from her family members and opinions of the physicians who have a long history of treating her, as well as medical records that, although they did not show a condition that was always consistently as severe as she now claims that it was, did confirm that she had long-standing complaints consistent with her current diagnosis. Plaintiff also provided an FCE confirming her disability, and the Sixth Circuit had recognized such FCEs as an appropriate “method of objective proof of disability” in fibromyalgia cases, particularly given that confirming the existence of the condition itself is so difficult. 

When the court considered evidence corroborating a condition, what mattered to it was not whether the particular corroborating details were themselves disabling, but, rather, what inference the details would support—allowing the beneficiary to demonstrate the disabling nature of the condition by other means. Accordingly, despite all of Unum’s arguments about the supposed lack of objective findings supporting a diagnosis, the court held there did not actually appear to be much disagreement regarding the fact that plaintiff had, in fact, presented evidence consistent with the existence of a medical condition—fibromyalgia—regardless of whether that condition could be verified by medical tests. 

The meaningful disagreement was whether her condition is disabling. Accounts from Plaintiff’s family and doctors appeared to confirm that her symptoms made it effectively impossible for her to reliably work complete days, even in a sedentary position. In contrast, the court viewed the explanations for why plaintiff’s fibromyalgia would not be disabling as mostly unpersuasive and based on the unsupported and conclusory assertion that a lack of corroborating physical manifestations of a disease necessarily established that disease’s non-disabling nature. 

In particular, the court highlighted the arguments advanced by Unum’s reviewing physician, Dr. Scott Norris. According to the court, Dr. Norris seemed to have simply assumed that fibromyalgia was never disabling for the purposes of a sedentary job. Neither Dr. Norris nor Unum, however, had provided any support for such a conclusion—and, indeed, Unum did not even try. Instead, Unum attempted to pick isolated bits of Dr. Norris’s analysis out to make it seem more nuanced than it was. 

Particularly striking to the court was Dr. Norris’s conclusory rejection of the possibility that fibromyalgia might be disabling given that he was not a rheumatologist and did not have meaningful expertise in the condition. The court cited to ERISA for why this was so troubling. See 29 C.F.R. § 2560.503-1(h)(3)(v) (stating that the insurer “shall consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment”). 

Finally, the court held that plaintiff’s own history of professional success and dedication to her career tended to weigh against any inference that she would falsify or exaggerate her symptoms to avoid her career responsibilities. Evidence before the court included a statement from a co-worker, who supervised plaintiff for three years and worked with her for more, said that plaintiff had been a “dedicated” and “honest” employee with a “positive attitude.” That supervisor stated that she “wish[ed] that she had a dozen” of plaintiff. (LTDR at 2678.) 

The court had clear eyes. It knew, of course, it was possible for an employee to go from having exemplary performance to exaggerating symptoms to avoid work. The court, however, found it more likely—particularly in light of the other evidence presented—that Plaintiff’s career trajectory was disrupted by her symptoms, as she had described and as the supervisor had corroborated. 

Seemingly convinced, the court turned to Unum’s arguments. It noted Unum devoted a significant amount of briefing to arguing that the court was not required to give extra weight to the opinions of treating physicians in an ERISA benefits case. On that principle, Unum was correct: the law was clear that the opinion of a treating physician “does not have to be afforded special deference.” Similarly, it was fair for Unum to point out that one of plaintiff’s treating doctors did not give her full opinion until after the initial denial of plaintiff’s claim, raising the possibility that the opinion may have been crafted to support plaintiff’s arguments—although, of course, each non-treating physician, by definition, also reached his or her opinions in the context of plaintiff’s contested claims. 

By the same token, however, a court is under no obligation to ignore the fact that a treating physician’s greater experience with a plaintiff may, depending on the context of the case, provide that physician with a superior basis for making certain determinations. That may be particularly true where, as the court held was present here, evaluating and interpreting the patient’s own account of her symptoms is so important to her diagnosis. 

The court, in its evaluation of plaintiff’s claims, had considered both (1) the potential bias that plaintiff’s treating physicians might have based on their relationships to her and (2) those treating physicians’ superior direct experience with plaintiff, and the court ultimately found the treating physicians’ assessments to be credible. The court stressed that it made that determination based on the circumstances of the case—not an any automatic presumption afforded to treating healthcare providers over later file reviewers or examiners. 

The court then explained the inherent difficulty with ERISA disability cases under the current legal regime. If this was another type of case—say, an ordinary breach of contract case litigated outside the structure imposed by ERISA—the court had the option of resolving these issues after it or a jury assessed the credibility of plaintiff and the various other witnesses in person. Because it was an ERISA case, however, the court was limited to the paper record. Based on that record, the court concluded that plaintiff had carried her burden of establishing her disability for the purposes of the LTD Plan. 

The court was open that this had been a close case. Ultimately, though, plaintiff’s symptoms, as she had documented and supported them, were simply too disruptive of her ability to regularly perform an ordinary work day or work week to permit her to serve in any position to which she would be reasonably fitted by training, education, or experience. Unum’s emphasis on the lack of objective corroborative findings was simply insufficient to rebut plaintiff’s case, in light of the well-established tendency of fibromyalgia to evade corroboration through imaging and testing.

The court recognized that plan administrators often understandably struggle with benefits cases involving fibromyalgia, a condition that is poorly understood and that, due to its lack of easily testable symptoms, lends itself to claims that depend, to a potentially uncomfortable degree, on the word of the beneficiary. But diseases and disorders do not care whether they present in a manner that lends itself to simple claims administration, and, unless the applicable plan provisions say otherwise, disabilities based on difficult-to-assess conditions are covered just as fully as disabilities based on easy-to-assess conditions are. 

All that any beneficiary, administrator, or court can do is approach these situations by applying the applicable plan provisions to the administrative record in light of the best medical understanding available, even if that understanding is evolving and incomplete. In this instance, plaintiff had documented her disabling condition sufficiently to support her claims. The court, accordingly, reversed Unum’s determination and awarded plaintiff her requested benefits.

Ninth Circuit

Kristin E. McCulloch v. Hartford Life and Accident Insurance Company, No. 19-cv-07716, 2021 WL 2651294, (N.D. Cal. June 28, 2021) (Judge Susan Illston).  Plaintiff’s filed a motion pursuant to Rule 54(b) seeking judgment as to some, but not all issues before the court. By way of background, the parties agreed to bifurcate the issues as follows: (1) whether plaintiff was disabled during the elimination period; and, (2) the eligible class (Class 1 or 2) under the LTD Plan applicable to plaintiff.  On December 2, 2020, the court issued an Order on Findings of Fact and Conclusions of Law and found that plaintiff was disabled during the elimination period.  As a result, plaintiff sought judgment pursuant to Rule 54(b) awarding long term disability benefits and reinstatement to the LTD Plan. Hartford opposed the motion claiming that the finding of disability was common to multiple causes of action, that plaintiff “does not have to wait long” for a ruling on the entire case and such a ruling will result in piecemeal litigation. The court disagreed and reasoned that plaintiff’s disability and class eligibility claims involve different factual issues, that there was no just reason for delay and the different factual issues ensures that the case will not go back to the Ninth Circuit on the same set of facts.  The court granted plaintiff’s request under the Rule 54(b).


Ninth Circuit

Cherry v. Prudential Ins. Co. of Am., No. C21-27 MJP, 2021 WL 2662183 (W.D. Wash. June 29, 2021) (Judge Marsha J. Pechman). Plaintiff Cherry brought this action for unpaid benefits and breach of fiduciary duty under ERISA against Prudential. Cherry agreed that review of his unpaid benefits claim should be limited to the record before the plan administrator, but filed a motion to compel, seeking discovery on his breach of fiduciary duty claim. Prudential argued that Cherry’s (a)(3) claim was duplicative of his unpaid benefits claim, and thus discovery should not be allowed under either claim. However, the court noted that “courts have consistently permitted discovery on Section 1132(a)(3) claims.” The court acknowleged that “the claims overlap,” but Cherry had made additional and different allegations in his (a)(3) claim. For example, he alleged that Prudential “solicited medical opinions from consultants ‘it knows to be biased’” and relied on their opinions even when presented with information showing that they were “unqualified or unreliable.” The court thus granted Cherry’s motion for limited discovery.

ERISA Preemption

Fifth Circuit

Advanced Physicians, S.C. v. National Football League, No. 20-10998, __ Fed. Appx. __, 2021 WL 2773112 (5th Cir. July 1, 2021) (Before Circuit Judges Davis, Duncan, and Oldham). Plaintiff is a medical provider that treated former NFL players. Cigna, the administrator of the NFL’s medical benefit plan, stopped making payments to the provider, allegedly because the NFL instructed Cigna to do so because the injuries being treated were “work-related,” which is excluded under the NFL’s plan. Plaintiff sued the NFL under state law for tortious interference, but the district court dismissed the claim because it was preempted by ERISA. Plaintiff appealed, and the Fifth Circuit affirmed. The court found that the essence of plaintiff’s complaint was that “the NFL wrongfully facilitated a coverage denial.” Coverage denials are quintessential ERISA claims. Furthermore, proper interpretation of the NFL benefit plan formed an essential part of plaintiff’s tort claim. As a result, plaintiff’s tortious interference claim was preempted by ERISA and was properly dismissed.

HMO La. v. Gupta, Civil Action No. 21-522 Section “R” (1)-02595, 2021 WL 2678933 (E.D. La. June 30, 2021) (Judge Sarah S. Vance). Before the Court was Plaintiff’ motion to remand the matter to state court. Defendant opposed the motion and moved for leave to conduct discovery. Because the Court found that neither ERISA nor FEHBA completely preempts Plaintiff’s claims, and because the discovery Defendant seeks would not affect the result, the Court granted Plaintiff’s motion to remand, and denied Defendant’s motion for jurisdictional discovery. The Court noted that for a district court to exercise removal jurisdiction, complete preemption must exist. It further noted that State law causes of action are completely preempted by ERISA when: (1) an individual, at some point in time, could have brought the claim under ERISA, and (2) there is no legal duty independent of ERISA or the plan terms that is implicated by the defendant’s actions. Having found that the complete preemption requirements were not met, the Court granted Plaintiff’s motion to remand.

Life Insurance & AD&D Benefit Claims

Fifth Circuit

Gray v. Minn. Life Ins. Co., CIVIL ACTION H-19-4672,  2021 WL 2637403 (S.D. Tex. Jun. 25, 2021) (Judge Gray H. Miller)  The plaintiff in this matter sought reconsideration of the court’s determination that Minnesota Life had “substantially complied” with federal law in its denial of plaintiff’s accidental death and dismemberment benefits after he suffered severe injuries due to a fall while having a seizure. The plan at issue was governed by ERISA. Plaintiff argued that the court had been “clearly erroneous” in its finding that plaintiff was not entitled to benefits. The court confirmed that the denial letters and appeal uphold letters had been sufficiently clear and covered the appropriate facts. It also confirmed that saw no basis to believe that plaintiff’s seizures were caused by plaintiff’s automobile accident several years ago and thus also caused by an “accident.”

Medical Benefit Claims

Fourth Circuit 

Bellon v. PPG Emp. Life & Other Benefits Plan, No. 5:18-CV-114, 2021 WL 2656753 (N.D.W. Va. June 28, 2021)(Judge Gina M. Groh) Former employees of PPG brought this lawsuit against their former employer when PPG transferred its responsibility to plaintiffs under the retiree health plan to Axiall and shortly after Axiall gave notice to plaintiffs that it was terminating its retiree health plan. The court determined ERISA does not prevent a sponsor from terminating an ERISA plan and there was no clear language in the plan stating that plaintiffs’ rights were vested. Additionally, the court determined that plaintiffs had no recourse against PPG since Axiall was the current plan sponsor and PPG had no obligation to plaintiffs. Finally the court stated that PPG had not breached any fiduciary duties to plaintiffs by transferring its obligations under the plan to Axiall. Defendant’s motion for summary judgment was granted and the case was dismissed.

Sixth Circuit

Zahuranec v. CIGNA Healthcare, Inc., No. 1:19CV2781, 2021 WL 2665754 (N.D. Ohio June 29, 2021) (Judge Pamela A. Baker). Plaintiff alleges that Cigna “reviewed [her] medical records and failed, refused, or neglected to properly apply its own guidelines to determine medical necessity of the bariatric surgical procedure” that she underwent in December 2013. Plaintiff claims that Cigna ‘breached the terms of the insurance policy by authorizing her medical provider to perform a surgical procedure for which she did not qualify” under the Plan. Cigna asserts that plaintiff cannot assert a claim under § 502(a)(1)(B) to enforce her rights under the Plan because she fails to sufficiently allege what rights she seeks to enforce. Cigna further argues that, as a matter of law, Plaintiff is not entitled to either equitable relief or compensatory damages under ERISA § 502(a)(1)(B). The court finds that plaintiff has failed to state a claim under ERISA § 502(a)(1)(B). The premise of plaintiff’s argument is that she did not receive any “benefits” under the Plan relating to her bariatric surgery because she did not “strictly comply” with all of the requirements of Coverage Policy and, therefore, the surgery was not “medically necessary.” Plaintiff does not direct this court’s attention to any language in the Plan that defines the term “benefit” as being limited to expenses relating to “medically necessary” care, treatment, or procedures. Nor does she cite any legal authority supporting her position that this court should construe the term “benefit” in such a narrow fashion. As to plaintiff’s breach of fiduciary duty claim, while Cigna did grant plaintiff’s request for coverage of the costs of the surgery, it did not make any representation (much less a misrepresentation) to Plaintiff regarding whether or not she should undergo that surgery.

Tenth Circuit

James C. v. Anthem Blue Cross & Blue Shield, No. 2:19-CV-38, 2021 WL 2532905 (D. Utah June 21, 2021) (Judge Clark Waddoups). The court ruled on the parties’ cross motions for summary judgment regarding Anthem’s denial of payment for residential treatment services received by plaintiff’s minor daughter, M.C. The court found discretionary language required an arbitrary and capricious review. The court find that any alleged procedural irregularities (i.e. delay in deciding appeal and inconsistent and/or incomplete reasons as to why Anthem was deny coverage) do not require the court to review Anthem’s denial de novo. The court found that the record contained sufficient evidence to support Anthem’s determination that M.C.’s treatment was not medically necessary, both under an arbitrary and capricious or a de novo standard of review. Specifically, the court found M.C. was not “manifesting symptoms and behaviors which represent a deterioration from their usual status and include either self injurious or risk taking behaviors that risk serious harm.” Regarding the federal parity claim, the court did not find the plan’s threshold for treatment at a residential center is more restrictive than for a skilled nursing facility. The court found the definitions comparable and did not violate the Parity Act. The court granted defendant’s motion for summary judgment. 

Pension Benefit Claims

Fourth Circuit

Knepper v. Volvo Grp. N. Am., No. CV ELH-18-02879, 2021 WL 2685271 (D. Md. June 30, 2021) (Judge Ellen L. Hollander). Plaintiff Knepper accrued pension benefits over the course of his 22-year employment with Mack Trucks and its successor, Volvo Group North America. Various pension plans were in effect during his employment. Knepper filed suit against VGNA and VGNA’s retirement plan for their alleged failure to calculate accurately and pay his pension benefits. Specifically, Plaintiff asserted two claims. First, he sought 34 months of retroactive early retirement benefits from the Mack and VGNA plans for the period of August 1, 2013, when he left employment, through June 1, 2016, when he began receipt of normal retirement benefits. Second, he alleged that since he began receiving his normal retirement benefits in June 2016, he had been underpaid regarding his monthly benefit under the Mack plan. In response, Defendants filed a motion for summary judgment, arguing: (1) Knepper’s late application constituted a waiver of his rights to retroactive benefits; (2) his miscalculation claim was barred because he failed to exhaust his administrative remedies; and (3) defendants were not responsible for the conduct of the Mack plan. Knepper opposed this motion not by contesting Defendants’ facts or arguments, but by arguing that the court should “equitably toll” any deadlines he might have missed. The court found that equitable tolling does not traditionally apply to time limits specified in ERISA plan provisions. Even if equitable tolling could apply, the court found that Knepper did not meet the “high bar necessary to invoke it” and granted defendants’ motion in full.

Pleading Issues & Procedure

Eighth Circuit

Faith Reg’l Health Servs. v. Ironshore Indem., Inc., No. 8:20CV444, 2021 WL 2682277 (D. Neb. June 30, 2021) (Judge Robert F. Rossiter, Jr.). A magistrate judge ruled in this ERISA case that plaintiff was not entitled to a jury trial, after which plaintiff filed an objection with the district court judge. Plaintiff argued that its breach of fiduciary duty claim under 29 U.S.C. § 1132(a)(2) was not an equitable claim or a claim for plan benefits. Instead, it was a legal claim for money damages, and thus it was entitled to a jury trial. The court rejected this argument and upheld the magistrate judge’s ruling. In doing so, the court relied on Eighth Circuit precedent which held that when a request for monetary relief turns on a determination of entitlement to benefits, the relief is an integral part of an equitable action, and the plaintiff has no constitutional right to a jury trial.

Provider Claims

Third Circuit

Open MRI & Imaging of RP Vestibular Diagnostics, P.A. v. Cigna Health & Life Ins. Co., No. CV-20-10345-KM-ESK, 2021 WL 2680153 (D.N.J. June 30, 2021) (Judge Kevin McNulty). Plaintiff is a medical provider that administered COVID-19 tests to patients insured by Defendant Cigna, and alleged that Cigna violated ERISA by refusing to pay for those tests. Cigna moved to dismiss, arguing that the provider had not adequately alleged that its patients had assigned their rights under ERISA to the provider. The court agreed with the provider that it was not required to prove the existence of such assignments, but noted that the provider had not even alleged that such assignments existed. Thus, the court granted Cigna’s motion and gave the provider leave to amend to properly allege that its patients had assigned their rights to it.

Fifth Circuit

Windmill Wellness Ranch, L.L.C. v. Meritain Health, Inc., et al., No. SA-20-CV-01388-XR, 2021 WL 2635845 (W.D. Tex. June 25, 2021) (Judge Xavier Rodriguez). Plaintiff alleges defendants underpaid Plaintiff’s out-of-network provider claims. Defendants filed a motion to dismiss, asserting lack of jurisdictional standing under ERISA. Windmill admits it does not have direct standing under ERISA and instead claims derivative standing under ERISA based on an agreement signed by a patient allowing Windmill to pursue legal remedies on the patient’s behalf. The court found the Plan barred assignment and the Fifth Circuit affirmed a denial of standing under ERISA based on an anti-assignment clause with very similar language. Plaintiff asserts defendants are barred from raising the anti-assignment clause for the first time six months after the lawsuit was filed. The court found defendants’ timely raised the anti-assignment clause in response to the allegations first raised in the second amended complaint. The court found that defendants did not acquiesce to plaintiff’s jurisdictional standing by paying Windmill directly. The court found defendants did not waive the anti-assignment clause. The court granted the motion and dismissed the complaint with prejudice. 

Standard of Review

Eighth Circuit

The Advisory Comm. of MTS Sys. Corp. Ret. Sav. Plan & Tr. v. Nelson, et al., No. CV 20-1435 (PAM/BRT), 2021 WL 2635153 (D. Minn. June 25, 2021) (Judge Paul A. Magnuson). Richard Nelson participated in the MTS Systems Corporation Retirement Savings Plan and Trust (“the plan”) through T. Rowe Price. As ERISA requires, 29 U.S.C. §§ 1055(c)(1)(A)(i), 1055(c)(2)(A), the plan’s terms dictated that Mr. Nelson’s wife, Linda, would be the account beneficiary unless Mr. Nelson validly designated and Mrs. Nelson validly consented to a different beneficiary. Mr. Nelson passed away on November 9, 2019. Prior to his death, Mr. Nelson executed a beneficiary-designation form, naming Ms. Swanson the sole beneficiary of his retirement account.  On November 15, 2019, six days after Mr. Nelson’s death, Ms. Swanson filed a claim for Mr. Nelson’s account, requesting that its funds be disbursed and transferred to her. On November 20, 2019, Mrs. Nelson called T. Rowe Price, questioning the change in beneficiary. Both women claimed to be Mr. Nelson’s account beneficiary. On December 21, 2019, the Advisory Committee (“the Committee”) for the plan denied both Mrs. Nelson’s and Ms. Swanson’s claims to the account. Both parties submitted written requests for review of the plan’s denials on February 24, 2020. In her appeal, Mrs. Nelson admitted that she signed spousal-consent waiver but claimed that she did so only because Ms. Swanson used fraud and undue influence to convince her to sign. The Committee concluded that “the spousal consent of Mrs. Nelson on the Beneficiary Designation obtained on November 6, 2019 is invalid based on undue influence and misrepresentation by Ms. Swanson.” The Committee reversed its denial of Mrs. Nelson’s claim and upheld its denial of Ms. Swanson’s claim to Mr. Nelson’s account. Due to Mrs. Nelson and Ms. Swanson’s conflicting recollections, the Committee relied on the testimony of three disinterested third parties. The Committee reviewed Mr. Nelson’s November 6, 2019, medical records, which included a physician’s note stating that “Mr. Nelson has a ‘friend’, Rachel, who he intends to be his trustee for some of his property.” The Committee also examined the testimony of Ms. Graf, the attorney who drafted Mr. Nelson’s estate plan on November 6, 2019. Ms. Graf’s notes reflect that Mr. Nelson wanted to form a trust and that Ms. Swanson repeatedly interrupted Mr. Nelson, attempting to speak for him. Also on that call, Ms. Swanson stated that she would not serve as the trustee for Mrs. Nelson if she was not compensated in some way for doing so. Further, the Committee considered two affidavits from the notary public, but the Committee acknowledged that the affidavits provided conflicting information about whether Mrs. Nelson was crying while she signed the spousal-consent waiver and whether she was aware of what she was signing. The Committee’s careful examination of relevant third-party evidence supports that the Committee did not abuse its discretion.


Eighth Circuit

Boilermaker-Blacksmith Nat’l Pension Tr. v. Ironhead Marine, Inc., No. 5:21-cv-06008-DGK, 2021 WL 2763174 (W.D. Mo. July 1, 2021) (Judge Greg Kays). This is a case brought by the trustees of a multi-employer pension plan against a participating employer for delinquent contributions. The employer counter-claimed for overpaid contributions, and filed a motion to transfer venue from the Western District of Missouri to the Northern District of Ohio, where it is located. The court denied the motion. The court found that venue was proper in Missouri because the plan is administered there. The court further found that the employer had not met its burden to show that the convenience factors under 28 U.S.C. § 1404(a) favored transfer, as transfer would merely “shift the inconvenience from one party to another.” Finally, the court found that the interests of justice would not favor transfer because plaintiff was entitled to its choice of forum, the court had already invested resources in the case, and much of the work in the case could be done electronically.