Beard v. Lincoln Nat’l Life Ins. Co., No. 25-2950, __ F.4th __, 2026 WL 1279959 (8th Cir. May 11, 2026) (Before Circuit Judges Shepherd, Erickson, and Grasz)

This week’s notable decision represents the latest foray by the federal courts into the Serbonian Bog of “just what is an accident anyway?” The Eighth Circuit declined to wade in very far and instead deferred to the interpretation of the plan’s claim administrator. As a result, the rest of the case was a foregone conclusion.

The plaintiff was Tina D. Beard, who was married to Edward Beard. Mr. Beard was a participant in an ERISA-governed accidental death and dismemberment (AD&D) plan sponsored by his employer. At the time of his death Mr. Beard was suffering from stage IV pancreatic cancer. The cancer and his chemotherapy treatments caused side effects such as generalized weakness, chronic diarrhea, and an elevated risk of blood clots. To mitigate the risk of blood clotting, Mr. Beard took a blood thinner.

On December 16, 2022, Mr. Beard fell and hit his head while rushing to the bathroom. Although a CT scan conducted at the emergency room showed normal results, Mr. Beard became unresponsive the following morning, leading to a second CT scan that revealed a large subdural hematoma compressing his brain. He died the next day.

Mrs. Beard submitted a claim for benefits under the AD&D plan to the plan’s insurer and claim administrator, Lincoln National Life Insurance Company. The plan provided that benefits were payable when an insured “suffers a loss solely as the result of accidental Injury that occurs while covered.” “Injury” was defined as “bodily impairment resulting directly from an accident and independently of all other causes.” Furthermore, the plan excluded coverage “for any loss that is contributed to or caused by…disease, bodily or mental illness (or medical or surgical treatment thereof).”

Lincoln denied Mrs. Beard’s claim, contending that Mr. Beard “did not suffer a loss solely as the result of an accidental injury independently of all other causes,” and that coverage was excluded because the blood thinner Mr. Beard was taking “contributed to the subdural hematoma[.]” Lincoln supported these conclusions with reports from two physicians, who examined Mr. Beard’s medical records and determined that Mr. Beard’s “blood thinner usage contributed to the subdural hematoma that caused his death.”

Mrs. Beard then filed this action in the United States District Court for the Southern District of Iowa under ERISA Section 1132(a)(1)(B), seeking payment of the benefits at issue. Lincoln filed a motion for judgment, which was referred to a magistrate judge. The magistrate judge recommended that Lincoln’s motion be granted, and the assigned Article III judge (Hon. Rebecca Goodgame Ebinger) agreed, overruling Mrs. Beard’s objections.

Mrs. Beard then appealed to the Eighth Circuit, which issued this published opinion. The court reviewed Lincoln’s decision for abuse of discretion because the plan granted Lincoln discretion to construe its terms and determine benefit eligibility. Under this standard, the court explained that it was required to uphold Lincoln’s decision if it was reasonable and supported by substantial evidence.

The court examined both of Lincoln’s reasons for denying Mrs. Beard’s claim, declaring, “We agree with Lincoln Life on both issues.” First, the court stated that Mrs. Beard had the burden to prove that her claim should be covered, and thus she was obligated to show that Mr. Beard suffered a loss “solely as the result of accidental injury, independently of all other causes.” This meant that Mrs. Beard had to prove that “the injury that caused Mr. Beard’s death resulted directly from his fall.”

The Eighth Circuit agreed with the district court that Mrs. Beard did not meet her burden. Lincoln’s denial letter explained that Mr. Beard’s blood thinner usage contributed to his hematoma, Mrs. Beard “did not come forward with any contrary evidence while her claim was before Lincoln Life,” and she conceded in her appellate briefing that the blood thinner probably did contribute to the hematoma. As a result, “because Mrs. Beard did not show Mr. Beard’s hematoma was caused by his fall, independently of all other causes, her claim was not covered.”

As for the plan’s exclusion for “disease, bodily or mental illness,” the Eighth Circuit noted that the burden shifted to Lincoln on this issue because “’when the administrator of an ERISA plan denies a claim based on an exclusion, it ‘has the burden of proving that the exclusion applies.’”

The court noted that “Mrs. Beard states in her brief that she ‘has no objection’ to Lincoln Life interpreting ‘contribute’ as ‘to give or furnish along with others towards bringing about a result.’” As a result, the “the only thing left for us to decide is whether Lincoln Life supported its conclusion that Mr. Beard’s blood thinner usage contributed to his death with substantial evidence.”

The court concluded that Lincoln had met its burden. Lincoln had relied on reports from its two physicians, both of whom “expressly concluded Mr. Beard’s blood thinner usage contributed to his death.” These doctors noted that subdural hematomas “mainly occur” in people who use blood thinners “because blood clots less easily and any bleeding…is likely to be more severe.” In such scenarios, “the outcome is likely to be worse, the risk of death doubles, and the hematoma is more likely to expand.” As a result, the court found that “a reasonable mind might accept” these opinions “‘as adequate to support [Lincoln Life’s] conclusion’ that Mr. Beard’s blood thinner usage gave or furnished along with his fall toward bringing about his death.”

Mrs. Beard contended that Lincoln’s evidence “only showed Mr. Beard’s blood thinner usage contributed to his hematoma, not his death,” but the court found that this argument “misses the mark for two reasons.” First, even if the court was not employing a deferential review, Mrs. Beard’s argument “invites us to conflate contributed to with something like effective cause.”

Second, under deferential review “we can only review for abuse of discretion and ‘must defer to [Lincoln Life]’s interpretation of the plan so long as it is ‘reasonable,’ even if [we] would interpret the language differently as an original matter.’” Mrs. Beard “concedes Lincoln Life’s interpretation is reasonable. We are therefore bound to apply that definition, as we did above.”

As a result, the Eighth Circuit affirmed the district court’s judgment and upheld Lincoln’s denial of Mrs. Beard’s claim for AD&D benefits.

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

Attorneys’ Fees

Third Circuit

Barragan v. Honeywell Int’l Inc., No. 24-CV-4529 (EP) (JRA), 2026 WL 1229040 (D.N.J. May 5, 2026) (Judge Evelyn Padin). This is a putative class action in which Luciano Barragan, on behalf of the Honeywell International Inc. 401(k) Plan, contends that Honeywell and related defendants violated fiduciary duties and engaged in prohibited transactions under ERISA by using forfeited employer contributions to the plan to offset future employer contributions to the plan instead of defraying administrative costs. In August of 2025 the court granted defendants’ motion to dismiss the case. The court ruled that the plan participants received all the benefits to which they were entitled, and that defendants followed plan rules and did not violate any fiduciary duties under ERISA, which gives plan administrators freedom in designing and administering plans. (Your ERISA Watch covered this decision in our August 27, 2025 edition.) Barragan has appealed this decision to the Third Circuit Court of Appeals, and in the meantime, defendants filed a motion for attorney’s fees. The court noted that federal courts have “significant discretion to manage their dockets as they see fit,” and decided to exercise that discretion to “defer deciding Defendants’ Motion until Plaintiff’s Appeal is resolved.” The court stated that deciding the motion before the appeal could lead to unnecessary steps if the Third Circuit reverses the dismissal. The court further emphasized that a decision from the Third Circuit would provide clarity on the merits of defendants’ motion, particularly regarding the Ursic factors, which courts in the Third Circuit use to decide whether attorney’s fees should be awarded. These factors included the degree of Barragan’s culpability and the relative merits of the parties’ positions. The court was “mindful” that many other courts have ruled that a pending appeal is insufficient to delay adjudication of an attorney’s fees motion, but “[t]he Court finds this action distinguishable in several respects. Most notably, Plaintiff commenced this action only two years ago, and Plaintiff has not made it past the pleadings stage (i.e., there has been no trial).” Thus, “the Court is of the view that in this action, it makes most sense to decide the Motion once Plaintiff’s Appeal has been resolved. While the Court recognizes the decisions to the contrary by several District Courts in this Circuit, the Court respectfully disagrees with their reasoning and is of the view that such a deferral is appropriate here.” The court thus ordered defendants’ motion to be administratively terminated, and allowed them to refile their motion “upon the resolution of Plaintiffs’ Appeal.”

Sixth Circuit

Chalk v. Life Ins. Co. of N. Am., No. 3:25-CV-133-RGJ, 2026 WL 1252337 (W.D. Ky. May 7, 2026) (Judge Rebecca Grady Jennings). Jennifer Chalk filed this action against Life Insurance Company of North America (LINA), alleging wrongful denial of her claim for ERISA-governed long-term disability (LTD) benefits. In November of 2025 the court ruled that LINA failed to render a decision on her claim within 45 days in violation of 29 C.F.R. § 2560.503-1(f)(3). As a result, the court remanded to LINA, finding that this procedural violation prevented a full and fair review and resulted in an incomplete and insufficient administrative record. (Your ERISA Watch covered this ruling in our November 5, 2025 edition.) In its ruling, the court indicated it would entertain a motion for attorney’s fees, so Chalk filed one. In the meantime, LINA requested additional information from Chalk, including medical records and other documentation, which Chalk provided. LINA then asked Chalk to undergo an independent medical evaluation (IME), which Chalk refused, arguing that her claim was “no longer ‘pending,’” and instead was on appeal, due to LINA’s failure to make a timely decision. Chalk then filed a motion to reopen the case, contending that LINA’s deadline to decide had passed. LINA scheduled the IME for January of 2026, but Chalk did not attend. LINA eventually approved Chalk’s claim for three months but denied it thereafter, citing her failure to attend the IME and the opinion of its medical director that her restrictions were consistent with her occupation. As a result, the court faced two motions: one to reopen the case and one for attorney’s fees. LINA opposed the motion to reopen, arguing that the applicable ERISA deadlines were not violated because the remand required a full initial review, not an appeal. The court sided with LINA, ruling that LINA had acted in a timely fashion because “LINA never conducted an initial review and thus there was no initial claim determination for Chalk to appeal.” The court thus ruled that “Chalk’s LTD claim remains properly before LINA on administrative review, consistent with the terms of the LTD Policy and all applicable ERISA requirements. For the avoidance of doubt, Chalk must exhaust her administrative appeal before reopening this case. In the interest of fairness, however, the Court will permit Chalk 180 days from this Order to file her appeal, though she may of course proceed sooner.” As for attorney’s fees and costs, the court granted Chalk’s request for costs but denied her request for fees. The court agreed that Chalk had achieved “some success on the merits” by obtaining a remand. However, in applying the Sixth Circuit’s five-factor King test, the court found that LINA’s failure to comply with ERISA’s notice requirements was due to a procedural mistake, not bad faith. The court further determined that a fee award would not deter other plan administrators from making honest mistakes and that the remand did not resolve a significant legal question or confer a common benefit on other plan participants. As a result, Chalk’s motion to reopen was denied, her request for $20,921 in fees was also denied, and she walked away from the skirmish with only $450.37 in costs.

Breach of Fiduciary Duty

Eleventh Circuit

Ulch v. Southeastern Grocers LLC, No. 3:23-CV-1135-TJC-MCR, 2026 WL 1243069 (M.D. Fla. May 6, 2026) (Judge Timothy J. Corrigan). Joyce Ulch, an employee of Southeastern Grocers LLC (SEG), brought this putative class action against SEG, contending that it has mismanaged the recordkeeping fees of its ERISA-governed 401(k) retirement savings plan, in which she is a participant. The plan’s recordkeeper is Fidelity Investments Institutional, which has received both direct and indirect compensation for its services. Ulch claims that the direct compensation the plan paid Fidelity was excessive relative to the services provided, and that SEG could have obtained cheaper fees because the plan has over $1 billion in assets and more than 12,000 participants, making it a “mega” plan with significant bargaining power. Additionally, she claims that Fidelity received excessive indirect compensation through “float” on participant money and revenue sharing from investments in the plan. SEG filed a motion to dismiss. At the outset, the court addressed the exhibits attached to SEG’s motion, which included “an attorney declaration, overviews of the Plan, Form 5500 reports, and documents from the earlier administrative process.” Ulch objected to these, contending that SEG was “asking the Court to weigh evidence and make factual determinations about disputed facts and to decide those disputed facts in Defendant’s favor at the dismissal stage.” The court agreed, ruling that many of the facts in the exhibits were disputed, and that SEG was “improperly…attempting to expand the appropriate record before the Court[.]” On the merits, the court found Ulch’s allegations regarding direct compensation plausible, as she “provided five comparable benchmarks of similar retirement plans with substantially lower reported recordkeeping fees than the Plan at issue here. By doing so, she has pled factual content that allows the Court ‘to draw the reasonable inference’ that SEG breached its fiduciary duty under ERISA by allowing Fidelity to receive excessive direct compensation.” As for indirect compensation, the court stated, “Although SEG raises some important questions about the strength of Ulch’s indirect compensation arguments, these questions cannot be decided on a motion to dismiss.” The court emphasized that the duty of prudence under ERISA is context-specific and cannot be fully assessed without discovery. On the complaint before it, the court concluded that “it is plausible that SEG breached its duty of prudence by failing to monitor Fidelity’s float and revenue sharing income.” As a result, although the court “makes no prediction on how this case will ultimately be decided on the merits,” Ulch’s complaint was sufficient to get past SEG’s motion to dismiss, which was denied.

Class Actions

Ninth Circuit

In re Sutter Health ERISA Litig., No. 1:20-CV-01007-LHR-BAM, 2026 WL 1283323 (E.D. Cal. May 11, 2026) (Judge Lee H. Rosenthal). In this class action, participants of the Sutter Health 403(b) Savings Plan alleged that plan fiduciaries violated their duties of prudence and loyalty by selecting and maintaining certain funds in the plan’s portfolio which had poor performance histories, and by charging participants unreasonable fees. Plaintiffs were able to dodge a motion to dismiss in 2023, and the parties subsequently reached a settlement. The court previously granted preliminary approval of the settlement, preliminary certification of the class for settlement purposes, and scheduled a fairness hearing. The court conducted that hearing in April, and in this brisk and efficient order the court granted final approval of the settlement agreement, finding it fair, reasonable, and adequate for the plan and the settlement class. The court certified the class under Federal Rules of Civil Procedure 23(a) and (b)(1), noting that the class was ascertainable, numerous, and had common questions of law or fact. The claims of the class representatives were typical of the class, and they were deemed capable of adequately protecting the class’s interests. The court also found that separate actions by individual class members could lead to inconsistent adjudications. As for the terms of the agreement, the court approved the settlement amount of $4,300,000, considering it fair and reasonable given the costs, risks, and potential delays of continued litigation. The settlement was negotiated at arm’s length with the assistance of a neutral mediator, and both parties had sufficient information to evaluate the settlement’s value. The court also approved the plan of allocation and found that the notice provided to the class was adequate and satisfied due process requirements. The court awarded $1,433,33.33 in attorneys’ fees to class counsel and $12,500 in compensatory awards to the class representatives, finding these amounts fair and reasonable based on the efforts and results achieved. The court dismissed the operative complaint with prejudice, entered judgment, and retained jurisdiction to resolve any disputes related to the settlement agreement.

ERISA Preemption

Seventh Circuit

Herbst v. Progress Rail Servs. Corp., No. 3:26-CV-145 DRL-SJF, 2026 WL 1238543 (N.D. Ind. May 4, 2026) (Judge Damon R. Leichty). Kody Herbst filed a lawsuit in state court against his former employer, Progress Rail Services Corporation, and a related entity, claiming that Progress Rail “misrepresented the date on which his employer-sponsored health coverage would end. In reliance on that representation, he incurred medical expenses that were not covered because his health plan terminated earlier.” Herbst brought claims for breach of contract, negligent misrepresentation, promissory estoppel, and equitable estoppel. Progress Rail removed the case to federal court on ERISA preemption grounds. Herbst moved to remand, arguing that the removal was untimely and the court lacked jurisdiction. Addressing timeliness first, Herbst argued that service was complete upon mailing the summons and complaint on December 31, 2025, under Indiana Trial Rule 5. However, the court clarified that Rule 5 applies to subsequent filings, not the original complaint. Service of the summons and original complaint is governed by Rule 4, which requires receipt for service to be effective. Service of these documents was deemed complete on January 5, 2026, making Progress Rail’s February 4, 2026 removal timely. As for jurisdiction, the court applied the two-part test from Aetna v. Davila to determine whether ERISA preemption applied. Apparently neither side applied this test in their briefing, so the court “treads lightly.” It found that Herbst’s negligent misrepresentation and estoppel claims were not preempted as they arose from “separate oral representations” and involved legal duties independent of ERISA. Mr. Herbst’s breach of contract claim was more complicated. The court stated that it was based on two theories. The first theory, alleging modification of the benefits arrangement, would likely be preempted by ERISA. The second theory, based on an enforceable employment agreement, would not necessarily depend on ERISA. Because federal law was only essential to only one theory, not both, the court determined that the contract claim was not completely preempted. Progress Rail argued in the alternative that Herbst’s claims constituted a “classic ERISA fiduciary-breach claim,” which would be preempted. However, the court found this argument “underdeveloped” because Progress Rail did not fully explain how it was a fiduciary or what its fiduciary duties were. The court noted that Progress Rail bore the burden of proving that removal was proper, and “doubts are resolved in favor of remand.” Finally, the court denied Herbst’s request for attorney fees, despite Progress Rail’s “underdeveloped” presentation of the removal issue: “§ 1447(c) isn’t a fee-shifting mechanism merely for unsuccessful advocacy, and the court cannot say the removal position was so clearly foreclosed as to be called objectively unreasonable.” Thus, Herbst obtained his requested remand, but he had to pay for the privilege.

Pension Benefit Claims

Seventh Circuit

Brya v. Pfizer Inc., No. 1:25-CV-06481, 2026 WL 1245461 (N.D. Ill. May 6, 2026) (Judge Sharon Johnson Coleman). In 2003, Thomas J. Brya was terminated by his employer, Pfizer Inc.  At that time, he received $427,230.16 in severance benefits in exchange for signing a release agreement that discharged Pfizer from any claims, including those under ERISA. In 2023 Brya received $548,514.14 in pension benefits. He contended that this number was miscalculated by Pfizer, but Pfizer denied his claim and subsequent appeal. As a result, in 2025 Brya filed this action against Pfizer and related defendants, alleging multiple violations of ERISA. His claims included: “(1) a breach of fiduciary duty claim for Defendants’ failure to provide accurate and comprehensive plan communications and for denying his pension claims without addressing substantive factual and legal considerations; (2) a claim for self-dealing and fraudulent nondisclosure stemming from Defendants’ use of administrative processes to deter participants from obtaining benefits; (3) violation of claims procedure for failing to provide Brya with a full and fair review on his benefits claim; (4) incorrect calculations and denial of pension benefits, (5) a claim for fiduciary misconduct against [a Pfizer manager] for transacting for her own benefit; (6) and a claim for breach of co-fiduciary duties against all Defendants.” Defendants moved to dismiss for failure to state a claim, arguing that (1) Brya’s claims were time-barred, (2) Brya’s claims were precluded by a decision in another case, Walker v. Monsanto, and (3) Brya released his claims in his severance agreement. The court agreed with all three arguments. First, the court found that Brya’s claims were barred by ERISA’s six-year statute of repose. The alleged miscalculation of Brya’s initial cash balance occurred in 1997, and the cessation of restoration credits to his plan account occurred in 2014, both outside the six-year period. Brya’s arguments for tolling the statute due to fraud and concealment were rejected because he was aware of the changes to his pension plan “long before filing suit.” Furthermore, Brya “has not pointed to any ‘steps taken by [the Committee] to cover their tracks’ or ‘to hide the fact of the breach.’” Second, the court determined that Brya’s claims were precluded by the ruling in the Walker class action, which addressed the same issues identified by Brya under the same plan provisions. The court noted that Brya was part of the class certified under Rule 23(b)(1) and (b)(2), which did not require notice or opt-out options for class members. Because Brya was a member of the class in Walker, and the Seventh Circuit ruled in favor of the plan in that case, his claims were barred by res judicata and collateral estoppel. Third and finally, the court concluded that Brya’s claims were barred by the release agreement he signed in 2003, which discharged Pfizer from any claims, including those under ERISA. The court further noted that Brya had not tendered back the severance payment, which was a condition precedent to challenging the validity of the release. As a result, Pfizer’s motion to dismiss was granted, with prejudice.

Pleading Issues & Procedure

Third Circuit

Aramark Services, Inc. v. QCC Ins. Co., No. CV 26-1664, 2026 WL 1284841 (E.D. Pa. May 11, 2026) (Judge Gerald J. Pappert). Aramark Services, Inc., along with its Group Health Plan, Uniform Services Health and Welfare Plan, and Benefits Compliance Review Committee initiated this action against QCC Insurance Company, Independence Blue Cross, and Independence Health Group, Inc. Aramark contends that defendants violated ERISA by breaching their fiduciary duties to Aramark’s plan and engaging in prohibited transactions, although the details of those allegations were not revealed in this order. Instead, this order evaluated QCC’s motion to seal parts of exhibits to Aramark’s complaint. Aramark asked for sealing relief first, although its request was more expansive; it wanted to file the entire complaint and three exhibits under seal. The court denied Aramark’s request, ruling that Aramark failed to overcome the federal courts’ presumption against sealing. In response, QCC moved to re-seal the three exhibits and file redacted versions on the public docket. The court acknowledged the public’s “presumptive right of access to judicial records,” which includes “pleadings and other materials submitted by litigants.” To overcome this presumption, the court stated that QCC had to show that “the material [sought to be sealed] is the kind of information that courts will protect and that disclosure will work a clearly defined and serious injury to the party seeking closure.” The information at issue was contained in the administrative services agreement (exhibit 1), network services contract (exhibit 2), and proposal for services (exhibit 3) between the parties, and included charges and fees as well as details about QCC’s cost reduction and savings program. QCC argued that this information was “not publicly available, is closely guarded by [QCC] in the ordinary course of business, and is disclosed to counterparties only subject to contractual confidential protections.” This was good enough for the court, which accepted that “the information might harm QCC’s competitive standing… Competitors could reverse-engineer its fees to undercut QCC’s competitive bids or replicate its cost-saving methods.” Furthermore, the redactions proposed by QCC “are limited to commercially sensitive information,” “minimally impact the public’s right to access,” and were “largely irrelevant” to the issues raised by the action. As a result, the court granted QCC’s motion.

Fourth Circuit

L.P. v. North Carolina Dental Soc’y, No. 1:26-CV-00104-MR, 2026 WL 1265748 (W.D.N.C. May 8, 2026) (Judge Martin Reidinger). L.P. is an employee enrolled in the ERISA-governed North Carolina Dental Society Healthcare Plan, and C.P. is L.P.’s dependent child and a beneficiary under the plan. From August 2024 through June 2025, C.P. received treatment at a residential facility for mental health issues. L.P. sought coverage for the treatment costs under the plan, but the claims administrator, Interactive Medical Systems Corporation (IMS), denied the claims. After exhausting the plan’s appeals, L.P. filed this action, asserting two claims for relief under ERISA: one for recovery of benefits under 29 U.S.C. § 1132(a)(1)(B), and the second for equitable relief under 29 U.S.C. § 1132(a)(3) for violation of the Mental Health Parity and Addiction Equity Act (MHPAEA), 29 U.S.C. § 1185a(a)(3)(A)(ii). Plaintiffs filed a motion to proceed anonymously, arguing that the case involves sensitive information about C.P.’s mental health challenges. (No defendant had yet appeared in the case so there was no opposition.) The court evaluated plaintiffs’ request using the Fourth Circuit’s five-factor test under James v. Jacobson. Under this test, the court denied plaintiffs’ motion. The court reasoned that (1) the core allegation – IMS’s denial of benefits for treatment – was not extraordinarily sensitive or personal, as it is a common assertion in ERISA actions; (2) plaintiffs acknowledged that there was no danger of direct retaliatory harm if they were not allowed to proceed anonymously; (3) although C.P. was a minor when the treatment began, C.P. had reached the age of majority by the time of the case was filed, and Federal Rule of Civil Procedure 5.2 does not require initials for adults; (4) the defendants were private companies, which weighed against allowing anonymity; and (5) plaintiffs were correct that there was no risk of harm to the defendants from the use of initials because defendants already possessed the relevant documents in unredacted form. Thus, only one factor weighed in favor of plaintiffs. In the end, “the Court must balance the Plaintiffs’ interest in anonymity against the public’s interest in openness… Here, the public has a strong interest in openness. To the extent these proceedings involve particularized, private, and sensitive information, redactions and filing under seal can limit access when needed without altogether concealing the identity of the litigants from the public.” Plaintiffs’ motion was thus denied, and the court directed them to file an amended complaint with their full names.

Provider Claims

Fifth Circuit

Abira Medical Laboratories, LLC v. Healthy Blue, Civ. No. 24-1039-SDD-SDJ, 2026 WL 1276441 (M.D. La. May 8, 2026) (Judge Shelly D. Dick). Abira Medical Laboratories, LLC, doing business as Genesis Diagnostics, is a provider of medical laboratory testing services and a frequent litigant asserting claims against insurers and benefit plans. In this action it sued a managed care organization called Healthy Blue, alleging that Healthy Blue refused to pay for out-of-network services provided by Abira. Abira contends that the requisitions for testing services that it submitted on behalf of Healthy Blue’s enrollees conferred third-party beneficiary status on it and allowed it to sue Healthy Blue under federal and state law. Specifically, Abira asserted claims for (1) violation of ERISA, (2) breach of third-party beneficiary contract, (3) breach of third-party bad faith, (4) quantum meruit/unjust enrichment, and (5) negligence. Healthy Blue filed a motion to dismiss, which the court converted into one for summary judgment. Abira failed to file a response, and thus the outcome was no surprise. The court granted Healthy Blue’s motion, dismissing all of Abira’s claims with prejudice. The court found that Abira had entered into a participating provider agreement with Healthy Blue in 2018, making it a participating provider in Healthy Blue’s network. This meant that the only viable claim Abira could have asserted was a breach of the agreement for failing to reimburse amounts due under the agreement, which was not alleged in the complaint. As a result, the court (1) dismissed the ERISA claim because Healthy Blue “does not issue, fund, underwrite, or administer employee health benefits plans, and does not issue, fund, underwrite, or administer commercial health insurance policies,” (2) ruled that Abira failed to provide evidence of any contract conferring third-party beneficiary status, (3) ruled there was no third-party bad faith for the same reason, (4) dismissed Abira’s quantum meruit claim because providing healthcare services to an insurance policy participant does not confer a benefit on the insurer, and (5) ruled that Abira’s claims were governed by the Medicaid framework and the parties’ agreement, and thus its negligence claim was not viable.

Standard of Review

Ninth Circuit

Farris v. Life Ins. Co. of N. Am., No. 25-CV-04164-RS, 2026 WL 1270071 (N.D. Cal. May 8, 2026) (Judge Richard Seeborg). Heather Farris lives in California and was employed by Lowe’s Companies, Inc., which is incorporated in North Carolina. Farris was a participant in Lowe’s ERISA-governed long-term disability employee benefit plan, which was insured by Life Insurance Company of North America (LINA). The policy insuring the plan was issued to Lowe’s in North Carolina, effective September 1, 2013, and includes a provision stating it is governed by North Carolina law. Farris submitted a claim for benefits to LINA under the plan, but LINA denied it, so Farris subsequently brought this action. Before the court here was LINA’s motion regarding choice of law and the applicable standard of review. The court treated the motion as one for partial summary judgment under Federal Rule of Civil Procedure 56 because LINA attached declarations and plan documents to its motion. Farris opposed the motion, contending that the plan was governed by California Insurance Code Section 10110.6, which became effective January 1, 2012, and provides that if a disability insurance policy is “offered, issued, delivered, or renewed, whether or not in California…that reserves discretionary authority to the insurer…to determine eligibility for benefits or coverage [or] to interpret the terms of the policy…that provision is void and unenforceable.” The court found first that the North Carolina choice of law provision was valid. Farris argued that the policy contained notices for residents of other states which vitiated the provision, but the court disagreed: “The statement, on the cover page of the Policy, that the Policy ‘shall be governed by [North Carolina’s] laws’ unambiguously reflects a choice of North Carolina law.” The court then ruled that the choice of law provision was enforceable. The court stated that choice of law provisions are enforceable under federal law so long as they are “not unreasonable or fundamentally unfair.” The court noted that various courts in the Northern District of California have upheld non-California choice of law provisions, even when they do not provide the protections intended by California Insurance Code § 10110.6. The court found “no persuasive reason to break from those cases.” (Your ERISA Watch covered the most recent of these cases, Moorhead v. Unum, in our April 8, 2026 edition.) The court ruled that “North Carolina choice of law is fair and reasonable for similar reasons as in those cases. Lowe’s is headquartered in North Carolina with hundreds of thousands of employees in states across the country, and so uniform application of North Carolina law to each dispute arising under the LTD policy is reasonable… Accordingly, the North Carolina Provision is enforceable as a choice of law provision, and the Discretionary Review Provisions are not voided by Section 10110.6.” The court thus granted LINA’s motion, and Farris’ claims will be decided under the abuse of discretion standard of review.