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Good morning, ERISA Watchers! We have two notable decisions to report again this week, including one that is a firm victory. 

Let us start with the good news. The first notable decision, Katherine P. v. Humana Health Plan, Inc., No. 19-50276, __F.3d__, 2020 WL 2479687 (5th Cir. May 14, 2020), revives life into a claim by a young woman seeking mental health benefits for partial hospitalization treatment. Katherine received partial hospitalization treatment in 2012 for multiple mental health disorders including an eating disorder. Humana paid for the first 12 days of partial hospitalization treatment and then denied benefits, claiming such treatment was no longer medically necessary based on two Mihalik Criteria. The parties filed cross-motions for summary judgment and the magistrate judge recommended judgment for Humana. The district court accepted the recommendation. Katherine P. appealed. 
Continue Reading Fifth Circuit Revives Claim Against Humana for Denying Eating Disorder Treatment

Good morning, ERISA Watchers! There were no notable circuit court decisions this past week, so we have chosen to highlight two published district court decisions from matters involving disability claims. The first is favorable to plan participants and the second is not. Is it any surprise that the former is from within the Ninth Circuit? 

Enjoy the long read of the summaries below. Until next week. Stay safe and be well.

The first case:  Jones v. Life Ins. Co. of N. Am., No. CV-19-04669-PHX-DLR, __ F. Supp. 3d __, 2020 WL 2126498 (D. Ariz. May 5, 2020). The almost Sisyphean topic of discovery in ERISA benefits cases added a new page when, on de novo review, the court required LINA “to respond to discovery that delves into the number of times it retained and the amount of money it paid to third-party vendors in disability and LWOP claims and medical reviewers utilized here, LINA-generated performance evaluations of the vendors and medical reviewers, the number of times they concluded that a claimant could perform work, LINA-generated performance evaluations for LINA employee Mary Faltaous, and any guidelines and manuals used by LINA in evaluating this claim, including the ‘DMS Expert Resource Professional conduct Statement’ and any guidelines and manuals.” 
Continue Reading District Court Permits Vast Conflict Discovery in Life Waiver of Premium Dispute Subject to De Novo Review

This week’s notable decision, Perrone v. Johnson & Johnson, et al., No. CV 19-00923 (FLW), 2020 WL 2060324 (D.N.J. Apr. 29, 2020), is a case involving allegations of investing in company stock when corporate insiders knew, and actively concealed, its talc powder (baby powder) contains asbestos. This is yet another case dismissed for failing to meet the high pleading standard set by the Supreme Court in Fifth Third Bancorp v. Dudenhoeffer, 573 U.S. 409 (2014).

Plaintiffs filed this as a purported class action against Johnson & Johnson, Peter Fasolo and Dominic Caruso, senior executives of the company and members of the benefits committee. Plaintiffs complaint alleges that as early as 1957, Johnson & Johnson knew its talc powder contains asbestos and not only concealed its knowledge for decades but engaged in an active campaign of providing misinformation and misleading statements about the safety of its product. However, in December 2018, Reuters published an article revealing the long history of actively hiding the presence of asbestos in its talc powder. The news article caused Johnson & Johnson’s stock to decline by more than 10%. 
Continue Reading Johnson & Johnson Escapes Breach of Fiduciary Duty Lawsuit Due to Dudenhoeffer’s Difficult Pleading Standard