Federation of Americans for Consumer Choice, Inc. v. United States Dep’t of Labor, No. 6:24-cv-163-JDK, __ F. Supp. 3d __, 2024 WL 3554879 (E.D. Tex. Jul. 25, 2024) (Judge Jeremy D. Kernodle)

American Council of Life Insurers v. United States Dep’t of Labor, No. 4:24-cv-00482-O, 2024 WL 3572297 (N.D. Tex. Jul. 26, 2024) (Judge Reed O’Connor).

In November of last year, Your ERISA Watch departed from its usual practice of covering a case of the week to report on the Department of Labor’s issuance of a new proposed rule and related exemptions defining who qualifies as a fiduciary investment advisor under ERISA, and to briefly summarize the long and complicated history of the Fiduciary Rule.

In creating the rule, the Department of Labor (“DOL”) held a notice and comment period in which it received over 600 comments, and held hearings in which scores of witnesses testified over several days. Ultimately, on April 25, 2024, the DOL issued a final Fiduciary Rule and set of prohibited transaction exemptions that mostly tracked but also differed in a number of respects from the proposal. By expanding the universe of advisors who are considered fiduciaries, the Rule aims to prohibit, or at least regulate, a great deal of conflicted investment advice that is costing retirees tens of billions of dollars in lifetime retirement savings. 

As predicted, several legal challenges quickly followed. Two of these have now achieved significant, although not yet final, victories. Both involved a federal Texas district court ruling that the effective date of the Fiduciary Rule should be stayed.

In Federation of Americans for Consumer Choice, an organization made up of marketing entities and insurance agents and agencies brought suit in the Eastern District of Texas challenging the Fiduciary Rule as inconsistent with ERISA, the Internal Revenue Code, and the Administrative Procedure Act (“APA”), and as arbitrary and capricious agency action. Shortly thereafter, the Federation moved for a preliminary injunction of enforcement of the Rule or a stay of the Rule’s September 23, 2024 effective date. The Federation also moved to enjoin one of the exemptions, prohibited transaction exemption (“PTE”) 84-24, which requires insurance agents to adhere to impartial conduct standards and make specified disclosures. In his order, Judge Kernodle granted the stay until further notice.

The court started with an exhaustive trek through the history of the Rule. It began with the statutory definition of fiduciary in ERISA, which includes any person who “renders investment advice for a fee or other compensation,” 29 U.S.C. § 1002(21)(A), and then discussed a regulation promulgated by the DOL in 1975 setting forth a five-part test for who qualifies as an “investment advice fiduciary.” The court then addressed an amended regulation adopted by DOL in 2016 to narrow the five-part test, which was struck down by the Fifth Circuit as in “conflict with the plain text” of ERISA, and “inconsistent with the entirety of ERISA’s ‘fiduciary’ definition” in its treatment of financial service providers. Chamber of Commerce v. Dep’t of Labor, 885 F.3d 360 (5th Cir. 2018).

The court then turned to the four familiar factors traditionally examined in determining whether to grant injunctive relief: (1) likelihood of success on the merits; (2) the threat of irreparable harm to the challengers if no relief is granted; (3) whether other interested parties are likely to be irreparably harmed by a grant of relief; and (4) the public interest. The court determined that each factor supported the grant of a stay, which it saw as a less drastic remedy than a preliminary injunction.

With respect to the likelihood of success, the court largely agreed with plaintiffs that the 2024 Fiduciary Rule suffered from the same defects as the 2016 Rule previously struck down by the Fifth Circuit in the Chamber of Commerce decision. Moreover, in perhaps the first application in the ERISA context of the Supreme Court’s recent decision in Loper Bright Enters. v. Raimondo, 144 S. Ct. 2244 (2024), the district court determined that it “owes no deference to DOL’s interpretation of ERISA.”

The court concluded that the 2024 Fiduciary Rule conflicts with ERISA in at least two ways by eliminating two prongs of the 1975 test – that the advice be given on a “regular basis” and that it serve as the “primary basis” for the investment decisions – both of which the court saw as inexorably tied to the “relationship of trust and confidence” that the Chamber of Commerce decision identified as embedded in the statutory definition. The court also faulted the DOL’s rulemaking in numerous other respects, including that the Rule improperly elides the distinction between investment advice and sales pitches, and that it improperly exceeds DOL’s rulemaking authority by regulating IRAs.

As if that were not enough, the court also relied on the new-fangled “major questions doctrine” – which posits that extraordinary agency powers require clear grants of authority – to supply “an additional basis for concluding that the 2024 Fiduciary Rule violates the APA.” In this regard, the court reasoned that “[a]ccepting DOL’s interpretation of ERISA would grant it ‘virtually unlimited power to rewrite’ the statute’s text” after 50 years with regard to the definition of investment advice.

Relying mostly on the Chamber of Commerce decision, the court also found that DOL acted arbitrarily and capriciously in amending PTE 84-24, finding, among other things, that DOL improperly created a private right of action to enforce some of the “best interest”/impartial conduct standards on newly regulated entities.

The court next found that allowing the Rule to go into effect would indisputably subject the plaintiffs to substantial compliance burdens. Finally, with respect to the fourth and fifth factors, the court found “that the injuries likely to occur if a stay is not granted easily outweigh ‘any harm that will result if the injunction is granted.’”

The court therefore issued an indefinite stay of the effective date of the regulation and of PTE 84-24. The court declined to limit the stay to the parties in the case, finding such a limitation would be both unwarranted and unwieldy.          

In American Council of Life Insurers, another insurance group brought a similar suit challenging the Fiduciary Rule in the Northern District of Texas. Judge O’Connor took note of Judge Kernodle’s decision issued just two days earlier and stated that he “agrees with and fully incorporates that analysis here.”

However, Judge O’Connor also noted that “two [additional] aspects of the Rule remain at issue here: Amendment to Prohibited Transaction Exemption 2020-02, 89 Fed. Reg. 32,260 (Apr. 25, 2024) and Amendment to Prohibited Transaction Exemptions 75-1, 77-4, 80-83, 83-1, and 86-128, 89 Fed. Reg. 32,346 (Apr. 25, 2024).” Those aspects of the Rule also failed to pass muster in Judge O’Connor’s estimation and thus he ruled that a stay of the effective dates of those PTEs was likewise warranted.

The court stated the four relevant factors slightly differently – (1) a substantial likelihood of success on the merits; (2) a substantial threat of irreparable harm; (3) the balance of hardships weighs in the movant’s favor; and (4) issuance of a preliminary injunction will not disserve the public interest – and noted that the third and fourth factors merge when the government is the defendant. All of the factors, the court found, supported staying the Rule.

On the first factor, Judge O’Connor found not just likelihood of success, but virtual certainty, for essentially the same reasons as Judge Kernodle. Essentially, the court found that “Defendants arguments are nothing more than an attempt to relitigate the Chamber decision.”

The court next found that plaintiffs would suffer undisputed irreparable harm by having to expend costs on compliance that would not be recoverable. As to the third and fourth factors, the court found that “Plaintiffs’ strong showing of a likelihood of success is dispositive of these final factors because ‘there is generally no public interest in the perpetuation of unlawful agency action.’”

As in the Federation decision, Judge O’Connor found that a stay was justified as a less drastic remedy than a preliminary injunction, and like Judge Kernodle he declined to “limit its relief to only the parties in this case.” Moreover, given the court’s conclusion that success on the merits was virtually guaranteed, it declined to remand to DOL as “inefficient and a potential waste of resources.”  

The importance of the Rule for retirees is hard to overstate given overwhelming evidence of the negative impact of conflicted investment advice on retirement savings, especially for low and moderate income retirees. Nevertheless, the prospect that the stays will be lifted in either district court, or that DOL will ultimately prevail in those courts, appears dim. Indeed, as noted above, Judge O’Connor bluntly stated that “Plaintiffs are virtually certain to succeed on their claims that the Rule exceeds DOL’s statutory authority.”

So, once again, it appears up to the Fifth Circuit whether any or all of the Fiduciary Rule will ever go into effect. We at Your ERISA Watch remain ever hopeful. Stay tuned as always for updates on this important topic.   

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

Attorneys’ Fees

First Circuit

Gomes v. State St. Corp., No. C.A. 21-cv-10863, 2024 WL 3596892 (D. Mass. Jul. 30, 2024) (Judge Mark L. Wolf). This April, the court preliminarily approved a proposed class action settlement in this litigation alleging breaches of fiduciary duties under ERISA regarding the State Street Salary Savings Program retirement plan. If the court grants final approval of the proposed settlement after the August 8 fairness hearing, defendants will contribute $4.3 million to a common fund, out of which class members will receive distributions minus litigations costs, attorneys’ fees, and other expenses. Plaintiffs moved for attorneys’ fees, seeking a common fund fee award totaling $1,433,333.33, or 33.3% of the settlement fund. Plaintiffs are represented by lead counsel Scott + Scott and co-counsel Peiffer Wolf Carr Kane Conway and Wise. In their motion, plaintiffs’ counsel calculated their lodestar as $1,592,595 and argued that this amount supports the reasonableness of their requested common fund fee. They assert that their lodestar was calculated using the attorneys’ regular hourly rates charged for their services and that these amounts “have been accepted in other complex or class action litigation, subject to subsequent annual increases.” However, neither firm represented that they actually charge their clients these hourly rates, as their practices are primarily contingent. This detail was significant to the court, which deferred ruling on plaintiffs’ fee motion. The court ordered counsel to file affidavits explaining why the requested one-third common fund fee award is reasonable in view of two other settled class action lawsuits in which Scott + Scott served as lead counsel and the attorneys were awarded fees between 20-30%. In addition, the court required counsel to discuss whether either law firm has billed any clients on an hourly rather than contingent basis, and, if so, to state which of their attorneys billed clients hourly, how many clients were billed on an hourly basis, and the hourly rate that each attorney charged. The court stated that once it has these facts it will then possess the necessary information to determine whether the requested fee award is indeed fair and reasonable.

Breach of Fiduciary Duty

Ninth Circuit

Johnson v. Carpenters of W. Wash. Bd. of Trs., No. 23-35370, __ F. App’x __, 2024 WL 3579492 (9th Cir. Jul. 30, 2024) (Before Circuit Judges Friedland, Mendoza, and Desai). Three union carpenters who were participants in two multi-employer pension plans appealed the dismissal of their putative class action against the Carpenters of Western Washington Board of Trustees and Callan, LLC in which they alleged fiduciary breaches and plan mismanagement. In this decision the Ninth Circuit reversed and remanded. The court of appeals concluded that plaintiffs had standing, and that they sufficiently stated their claims of imprudence and failure to monitor under ERISA. First, the Ninth Circuit held that plaintiffs need not allege absolute losses to their retirement accounts to sufficiently allege a concrete financial injury. Instead, plaintiffs’ allegations that the value of their accounts would be greater today had defendants not invested in the challenged indexes was considered by the Ninth Circuit to be more than sufficient. Moreover, the appeals court agreed with plaintiffs that their injury was fairly traceable to defendants’ actions. In addition, the court of appeals disagreed with the district court’s position that the COVID-19 pandemic was the intervening and independent cause of plaintiffs’ injury. Rather, it held that it was plausible “that the pandemic was simply the trigger that revealed the alleged consequences of Defendants’ actions,” and that defendants’ alleged conduct “left the Plans vulnerable to a negative market event,” making COVID not an independent cause of plaintiffs’ loss, “but part of the foreseeable consequences of Defendants’ actions, according to Plaintiffs.” Furthermore, the Ninth Circuit held that plaintiffs stated their claims under ERISA by adequately alleging that defendants violated their fiduciary duties when they chose to make the challenged investments and when they failed to monitor and remove them. “We have held that a fiduciary violated its duty of prudence under similar circumstances, in which an investment advisor recommended investing a large portion of a retirement plan into investments that were excessively risky given the plan’s conservative aims.” Based on the foregoing, the court of appeals reversed the dismissal of plaintiffs’ complaint and remanded to the district court.

Disability Benefit Claims

Sixth Circuit

Halleron v. Reliance Standard Life Ins. Co., No. 3:22-CV-00633-GNS-CHL, 2024 WL 3585139 (W.D. Ky. Jul. 29, 2024) (Judge Greg N. Stivers). Dr. April Halleron stopped working and applied for short-term and long-term disability benefits in the summer of 2022 after she was diagnosed with postural orthostatic tachycardia syndrome (“POTS”), a condition linked with low blood pressure, high pulse rates, dizziness, fatigue, and fainting. Dr. Halleron believed she could no longer work as a physician due to her low energy levels, dizziness, light-sensitivity, body pains, weakness, and episodes of near fainting. However, the insurance company responsible for her disability coverage, Reliance Standard Life Insurance Company, disagreed and denied both of Dr. Halleron’s claims. It concluded that Dr. Halleron’s POTS was a preexisting condition making her ineligible for short-term benefits. Her long-term claim, while not barred by a preexisting conditions exclusion, was still denied after Reliance determined that Dr. Halleron did not meet the policy’s definition of total disability. In this action, Dr. Halleron challenges both denials. The parties filed competing motions for summary judgment. In this decision the court granted Dr. Halleron’s motion for judgment and denied Reliance Standard’s summary judgment motion. To begin, the court stated that it need not resolve the parties’ dispute over the applicable review standard because “the denials do not survive even an arbitrary and capricious review.” Next, the court disagreed with Reliance Standard that Dr. Halleron’s claims for benefits are barred because she failed to appeal its denials through the administrative appeals process. The court deemed Dr. Halleron to have exhausted her administrative remedies because Reliance Standard failed to strictly comply with ERISA’s claims handling regulations, and thus Dr. Halleron is entitled to “immediate access to judicial review.” As for the denials themselves, the court concluded that neither one was “the product of a deliberate, principled reasoning process.” With regard to the long-term disability benefit claim, the court criticized Reliance Standard’s one-paragraph decision, which it stated lacked substance, supporting evidence, medical analysis, and consideration of whether Dr. Halleron’s symptoms prevent her from performing her job functions. It found that the denial did little more than recite Dr. Halleron’s medical history, and that it completely failed to address her treating physician’s opinions, which rendered the denial arbitrary and capricious. And with regard to the short-term disability denial, the court found that the denial was cursory and lacked a detailed analysis of why it determined the POTS diagnosis was a preexisting condition. Accordingly, the court said that it too was arbitrary and capricious. For these reasons, the court entered judgment in favor of Dr. Halleron. However, it chose to remand back to Reliance Standard as the flaw here was the integrity of the decision-making process, and remanding to the plan administrator is generally considered the appropriate remedy under such circumstances. Finally, the court ordered Reliance Standard to file a brief in response to Dr. Halleron’s request for attorneys’ fees and costs.

Eighth Circuit

Weyer v. Reliance Standard Life Ins. Co., No. 23-2862, __ F. 4th __, 2024 WL 3577374 (8th Cir. Jul. 30, 2024) (Before Circuit Judges Colloton, Shepherd, and Stras). This ERISA benefits action was filed by Kelsey Weyer after her long-term disability benefits were terminated by defendant Reliance Standard Life Insurance Company. Ms. Weyer suffers from a host of medical conditions which have left her with serious physical and cognitive limitations. Given these limitations, and based on the entirety of Ms. Weyer’s medical record, the district court entered judgment in her favor when it ruled on the parties’ cross-motions for summary judgment. In reaching its decision, the district court concluded that the evidence in the record supported that Ms. Weyer was totally disabled from performing any occupation. Reliance Standard appealed the district court’s order. It argued that Ms. Weyer is not totally disabled, and even if she were, her mental health conditions, including a history of anxiety and depression, caused or contributed to her total disability such that her benefits should be limited to a maximum of 24 months pursuant to the plan’s mental health maximum lifetime benefits clause. On appeal, the Eighth Circuit found no clear error in the district court’s de novo review of Reliance Standard’s decision and thus affirmed. It held that the district court, as the factfinder, reasonably interpreted what it saw as the overwhelming evidence in the record establishing that Ms. Weyer lacked even sedentary work capacity. On the other hand, the evidence cited by Reliance Standard in support of its decision to terminate benefits was viewed by the appeals court as not enough to conclude that “a definite and firm…mistake has been made.” Accordingly, the Eighth Circuit stated the lower court did not clearly err in finding that Ms. Weyer was totally disabled under the terms of the policy. In addition, the court of appeals found no fault with the lower court’s findings that Ms. Weyer’s physical conditions independently rendered her disabled and that Ms. Weyer’s anxiety and depression were not the cause of her disability but “simply downstream effects of her physical illness.” Thus, the Eighth Circuit was not persuaded that the district court clearly erred in any of its holdings and upheld the judgment in its entirety.

ERISA Preemption

Ninth Circuit

University of S. Cal. v. Heimark Distrib., No. CV 24-5550 FMO (SSCx), 2024 WL 3582625 (C.D. Cal. Jul. 30, 2024) (Judge Fernando M. Olguin). The University of Southern California sued Heimark Distributing, LLC in California state court, on behalf of its hospitals, alleging state law claims for breach of implied contract, unfair business practices, unjust enrichment, quantum meruit, and accounts stated, seeking reimbursement for medical services provided to a patient insured under Heimark’s employee health plan. Heimark removed the action, asserting that the federal court system has subject matter jurisdiction because the state law claims are preempted by ERISA. In this decision the district court disagreed and remanded the lawsuit back to state court. The court found that the complaint failed the two-part Davila complete preemption test because USC does not allege anywhere in the complaint that it was assigned benefits. Noting that a defendant bears the burden of showing that a plaintiff’s claims are completely preempted, the court concluded that Heimark did not meet that burden on the face of the complaint. Moreover, it stated that “the mere fact that no written contract exists between plaintiff and defendant does not require the conclusion that the Patient assigned his or her ERISA benefits to plaintiff.” Accordingly, the court found it lacked jurisdiction over the matter and sent the case back to the Superior Court of the State of California.

Life Insurance & AD&D Benefit Claims

Third Circuit

Gratz v. Gratz, No. 3:19-cv-1341, 2024 WL 3598835 (M.D. Pa. Jul. 31, 2024) (Judge Julia K. Munley). Plaintiffs Jillian and Tyler Gratz are the children of decedent Dr. Richard Gratz. In this ERISA action the siblings allege that Dr. Gratz’s older brother, defendant Michael Gratz, exercised undue influence on their father to procure a change in beneficiary on his life insurance coverage following the death of his wife. Defendant moved for summary judgment. His motion was denied as the court concluded that plaintiffs raised questions of material fact regarding whether their father had a weakened intellect following his wife’s death and whether Michael had a “confidential relationship” with Dr. Gratz which influenced his change in beneficiary. “Notably, the inquiry into the exercise of undue influence is a highly fact-intensive one.” Viewing the evidence in the light most favorable to plaintiffs, the court stated that a reasonable finder of fact could conclude that Dr. Gratz suffered from severe mental distress and mental health disorders after the death of his wife, and that these mental health concerns could have left him in a weakened intellectual state and potentially subject to undue influence. Further, the court agreed with plaintiffs that it is plausible that the brothers had a close personal relationship. Moreover, the court expressed that it could only determine the absence of undue influence after assessing the credibility of the parties and other witnesses. “As credibility is at issue, summary judgment in favor of the defendant regarding the absence of undue influence is inappropriate.” For these reasons, the court found that summary judgment should not be granted.

Pension Benefit Claims

Third Circuit

Rombach v. Plumbers Local Union No. 27 Pension Fund, No. 2:20-cv-01348, 2024 WL 3554571 (W.D. Pa. Jul. 26, 2024) (Judge Mark R. Hornak). For over thirty years plaintiff Clyde Rombach, III worked for W.G. Tomko, Inc (“Tomko”) and contributed to a multi-employer pension fund, the Plumbers Local Union No. 27 Pension Fund. In his later years of employment, Mr. Rombach worked as a Project Manager at Tomko. This position remained covered by the Union and required Tomko to make contributions to the fund on Mr. Rombach’s behalf. Then, in 2009, Mr. Rombach assumed a new position, Senior Project Manager. As Senior Project Manager, Mr. Rombach took on some new responsibilities and his Union membership and contributions to the plan ended at this time. Neither the Union nor the Plan took issue with these status changes. On August 15, 2016, Mr. Rombach turned 60 and applied for early retirement benefits under the Plan. The Trustees acknowledged that Mr. Rombach was eligible for early retirement benefits based on his age and years of covered service, “but simultaneously suspended his pension benefit based on his then-current work at Tomko in the position of Senior Project Manager.” Following an ultimately unsuccessful administrative appeal of the benefit decision, Mr. Rombach commenced this litigation alleging the Plan improperly suspended his early retirement pension benefits from October 2016 to December 2019 under the terms of the plan in violation of ERISA. The parties cross-moved for summary judgment under abuse of discretion review. The court concluded that the Trustees’ ultimate decision “was inherently arbitrary” and entered summary judgment in favor of Mr. Rombach. The court ordered the Plan to “take all steps necessary to reverse the financial and any other impact on Rombach of the suspension during the time window at issue, including payment over of the suspended early pension benefits, prejudgment interest, and post-judgment interest…each at the statutorily applicable rate.” It was significant to the court that Mr. Rombach’s change of position from Project Manager to Senior Project Manager resulted in Union membership ending and plan contributions stopping, and stated that these changes “must logically…carry meaning.” However, as the court noted, the Trustees equated the two positions and entirely failed to explain or even address the differences between the two for the purposes of Mr. Rombach’s eligibility for early retirement benefits. By treating the two jobs as “one and the same,” simply because some of the daily tasks of the work at each position overlapped, the court concluded that defendants had abused their discretion. In fact, as the Trustees noted, the Senior Project Manager was responsible for supervising the Project Managers, “plainly placing it at least one step above the Project Manager position.” It was important to the court that the Trustees did not address this fact when deciding to suspend the early retirement benefits. Zooming out, the court took issue with defendants’ broader proposition that all jobs at Tomko were necessarily included within the Union’s industry trade. It stated that such a reading “would lead to the result that an employee moving into a top executive position from a Plan-covered position would also be considered to be employed in a ‘trade or craft in the industry.’ Under any standard of review, that unreasonably gives too broad a reading to the suspension language within the Plan’s provision. In adopting such a theory in Rombach’s case, the Trustees acted unreasonably, erroneously, and arbitrarily.”

Pleading Issues and Procedure

Tenth Circuit

Andrew C. v. United Healthcare Oxford, No. 2:18-cv-877-HCN, 2024 WL 3553301 (D. Utah Jul. 26, 2024) (Judge Howard C. Nielson, Jr.). Plaintiffs Andrew and Paige C., individually and on behalf of their minor child, sued United Healthcare Oxford under ERISA seeking judicial review of denied claims for healthcare benefits. After the lawsuit was filed the parties filed a stipulated motion to dismiss the action without prejudice under Rule 41(a)(1)(A) after they agreed that United would reconsider the family’s claims for benefits. The court granted that motion. However, the family was not satisfied by United’s reconsideration of their claims, and subsequently moved to reopen the case pursuant to Federal Rule of Civil Procedure 60(b). The court stressed that relief under Rule 60(b)(6) is only available in “extraordinary circumstances,” and “appropriate only when it offends justice to deny such relief.” The court ruled that plaintiffs failed to meet these demanding standards. In particular, the court emphasized that the voluntary nature of the plaintiffs’ dismissal weighed strongly against the requested relief, as the plaintiffs are free to file a new action challenging United’s denial of their claims for benefits. Accordingly, the court denied the motion to reopen the case.

Provider Claims

Third Circuit

Samra Plastic & Reconstructive Surgery v. Cigna Health & Life Ins. Co., No. 23-21810 (MAS) (RLS), 2024 WL 3568844 (D.N.J. Jul. 29, 2024) (Judge Michael A. Shipp). An out-of-network plastic and reconstructive surgery center, Samra Plastic & Reconstructive Surgery, filed this lawsuit on behalf of itself and as an assignee of its patient against Cigna Health and Life Insurance Company and Bottomline Technologies, Inc. seeking reimbursement of 80% of the patient’s breast surgery, or $154,256. Samra asserted causes of action under ERISA, as well as state law claims for breach of contract, promissory estoppel, and account stated. Defendants moved to dismiss the complaint. They argued that Samra lacks derivative standing to assert ERISA claims, the state law claims are preempted by ERISA, and that Samra also fails to state its claims. The court tackled each issue independently. First, the court agreed with defendants that the plan contains a clear and unambiguous anti-assignment provision which precludes Samra from bringing an ERISA suit as an assignee. Accordingly, the court granted the motion to dismiss the ERISA causes of action. Nevertheless, the court disagreed with defendants on the issue of ERISA preemption. With regard to complete preemption, the court held that Samra could not bring claims under Section 502 and that its state law claims relate to an independent oral contract or quasi-contract between the parties which took place prior to the surgery and therefore are independent of the ERISA plan. The same was true regarding the court’s analysis of Section 514 conflict preemption. The court held that the claims at issue do not require any examination of the ERISA plan, meaning the plan is not a “critical factor in establishing liability.” Instead, the court agreed with Samra that its claims arise from a separate agreement between the parties wherein Cigna agreed to pay 80% of billed charges. Moreover, the court explained that the complaint sufficiently and plausibly states each of its three state law causes of action. For these reasons, the court denied defendants’ motion to dismiss the breach of contract, promissory estoppel, and account stated claims. Thus, the motion to dismiss was granted in part and denied in part, as detailed above.