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Your ERISA Watch – Fifth Circuit Denies Attorneys’ Fees to Plaintiff for en banc Success Changing Judicial Standard of Review

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This week’s notable decision is another terrible decision for ERISA plan participants out of the Fifth Circuit Court of Appeals:  Ariana M. v. Humana Health Plan of Texas, Inc., No. 18-20700, __F.App’x__, 2019 WL 5866677 (5th Cir. Nov. 8, 2019) (“Ariana II”).  This is a disappointing sequel in a case where the Fifth Circuit previously issued a plaintiff-friendly decision on the standard of review applied in ERISA cases.  The case first reached the Fifth Circuit in Ariana M. v. Humana Health Plan of Texas, Inc., 884 F.3d 246 (5th Cir. 2018) (“Ariana I”) in which the court issued an en banc published decision overturning the longstanding position on standard of review in Pierre v. Conn. Gen. Life Ins. Co., 932 F.2d 1552, 1562 (5th Cir. 1991).  The court reversed and remanded the case to the district court for review under a de novo standard of review. (Read more about Ariana I in Brent Dorian Brehm’s Fall 2017 EBC Newsletter article: What Does de novo Review Mean Under ERISA?)

On remand, the district court found that Humana had not wrongfully denied benefits for 106 days of partial hospitalization to treat an eating disorder because that level of treatment was not medically necessary. Ariana M. v. Humana Health Plan of Texas, Inc., 2018 WL 4384162 (S.D. Tex. Sept. 14, 2018).  In her second appeal, Ariana M. contended she was due benefits for partial hospitalization treatment which Humana had denied as not medically necessary. In an unpublished decision, the Fifth Circuit upheld the district court’s findings that at least one of the Mihalik criteria had no support and therefore medical necessity was not met under a de novo review.

The Fifth Circuit also considered “a somewhat more challenging question” of whether Ariana M.’s counsel was entitled to attorneys’ fees and costs for achieving the en banc decision in Ariana I.  The court concluded the district court did not abuse its discretion in denying Ariana M.’s fee motion because “[s]ecuring a change in the standard of judicial review of Humana’s factual determinations is certainly a procedural success, but it’s not success on the merits of Ariana’s benefits claim.” The court “expressed no opinion” on the opposite conclusion reached by the First Circuit in Gross v. Sun Life Assurance Co. of Canada, 763 F.3d 73 (1st Cir. 2014) except to state that the administrative record in Gross was inadequate, unlike the record in Ariana M.

While Ariana M.’s attorneys certainly deserved to be compensated by Humana for their success, their efforts in securing a change in the Fifth Circuit’s judicial standard of review will benefit plan participants for years to come.  (Read about the first post-Ariana M. de novo trial from earlier this year.)

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

Attorneys’ Fees

Fifth Circuit

Ariana M. v. Humana Health Plan of Texas, Inc., No. 18-20700, __F.App’x__, 2019 WL 5866677 (5th Cir. Nov. 8, 2019) (Before Clement, Haynes, and Willett, Circuit Judges). See Notable Decision summary.

Ninth Circuit

Boards of Trustees of the Seattle Area Plumbing & Pipefitting Industry Health & Welfare Trust, et al. v. Optimal Facility Solutions, LLC, No. 2:18-CV-00443-RAJ, 2019 WL 5887292 (W.D. Wash. Nov. 12, 2019) (Judge Richard A. Jones).  The Court awarded Plaintiffs, the trustees of five labor-management funds, attorneys’ fees, interests, and costs. On March 26, 2018, Plaintiffs sued Defendant Optimal Facility Solutions (“OFS”), for damages related to delinquent contributions between May 2017 and November 2017 to Plaintiffs’ fund for covered work performed. Additionally, after the lawsuit was filed an audit revealed that OFS underreported hours of covered work to Plaintiffs to the tune of nearly $23,000 in unpaid contributions. Plaintiffs filed a motion for summary judgment which was granted in part and denied in part on February 22, 2019 but erroneously awarded Plaintiffs liquidated damages that the parties would later stipulate to dismiss.  OFS argued that it should not have to pay fees related to the summary judgment motion because it prevailed on the issue of liquidated damages. The Court rejected this position citing Parkhurst v. Armstrong Steel Erectors, Inc., 901 F.2d 7096 (9th Cir. 1990) as dispositive authority awarding attorneys’ fees even though a liquidated damages provision was void as a penalty.  After applying minor discounts to Plaintiffs’ requests for attorneys’ fees, including for 4.0 hours reflected as “block” time entries, the Court granted Plaintiffs a fees award of $16,840, plus $4,610.47 in interest and $455.00 in costs.

Metro. Life Ins. Co. v. Gicana, et. al., No. 18-55785, No. 18-55989, No. 18-56174, __F.App’x__, 2019 WL 5957422 (9th Cir. Nov. 13, 2019) (Before Jerome Farris, Margaret McKeown, Ninth Circuit Judges, Barrington D. Parker, Second Circuit Judge sitting by designation). This case was initiated as an interpleader action by MetLife. Araceli Maloney and Bambi Gicana were named as Defendants-in-Interpleader and the parties stipulated to the dismissal of MetLife. In the course of reviewing Gicana’s claims that Maloney had breached her fiduciary duty to the Trust, additional funds that were in the Decedent’s 401(k) entered the dispute before the District Court. The parties agreed that these funds were assets of the Trust. The District Court concluded that Maloney had violated her fiduciary duties by diverting Trust assets—the 401(k) funds—into her own retirement account. The evidence also established that Maloney had used those funds for unauthorized personal expenditures. Accordingly, the District Court imposed an equitable lien in favor of the Trust on Maloney’s personal IRA and required her to provide the Trust with an accounting and to restore improperly disbursed funds. It also awarded attorneys’ fees and costs to Gicana. Maloney argued that because the equitable lien was granted on behalf of the Trust, Gicana did not prevail and therefore was not entitled to fees and costs. The Ninth Circuit disagreed. It explained that Gicana obtained an equitable lien that halted Maloney’s violation of the terms of the trust—her misuse of Trust assets for personal benefit. In addition, Maloney was required to furnish an accounting and to return funds improperly taken from the Trust. The Ninth Circuit held this relief satisfied the “some degree of success” standard needed for an award of fees and costs under ERISA.

Breach of Fiduciary Duty

Second Circuit

Friedman v. Michael Kooper, Stacey Lippman, Chiat-Day Holdings Inc. Employee Profit Sharing and 401(k) Plan, No. 19-CV-226 (PKC), 2019 WL 5865005 (S.D.N.Y. Nov. 8, 2019) (Judge P. Kevin Castel). Plaintiff Friedman sued his former employer’s 401(k) plan, Stacey Lippman in her role as plan administrator, and Michael Kooper individually as trustee of the 401(k) plan, under 29 U.S.C. §1132(a)(1)(B) for benefits due under the terms of the plan. The court dismissed Kooper from the litigation because plan trustees are only liable in their individual capacities for breaches of fiduciary duty, not benefit claims. Because Friedman did not allege Kooper breached any fiduciary duties, he has not stated a claim against Kooper as an individual.

Sixth Circuit

Miller v. Ret. Program Plan for Employees of Consol. Nuclear Sec., LLC, No. 3:17-CV-521, 2019 WL 5865924 (E.D. Tenn. Nov. 8, 2019) (Judge Curtis L. Collier). The Sixth Circuit reversed the district court’s interpretation of plan language regarding whether Plaintiff accrued pension credits during the time he was a leased employee. The Sixth Circuit found the plan language clearly excluded leased employees from accruing pension credits and therefore Plaintiff’s time as a leased employee did not count towards his pension benefits. On remand with the district court, Plaintiff filed a motion to amend his complaint to add a claim for breach of fiduciary duty against the retirement plan for making misrepresentations about how the plan worked and the appeals process. The court denied Plaintiff’s motion because the amended complaint failed to allege facts to support the breach of fiduciary duty claim and entered judgment for Defendant.

Disability Benefit Claims

Courville v. Life Insurance Co of North America, No. 6:18-CV-01133, 2019 WL 5957223 (W.D. La. Nov. 12, 2019) (Judge Robert R. Summerhays).  In this motion for judgment on the record filed by Defendants regarding the denial of LTD benefits, the Court dismissed each cause of action raised in the complaint. First, the Court held that because there was substantial evidence to support LINA’s determination that Plaintiff was not disabled, Defendant did not abuse its discretion in denying benefits. Second, the Court rejected Plaintiff’s claim under Louisiana Insurance Code section LA R.S. 22:900 that the definition of disability contained within the policy is overly broad, as 1) Plaintiffs did not request relief under the statute, he merely stated that the policy was overly broad, and 2) the disability plan was self-funded by the employer, and is thus not “insurance” as defined by La R.S. 22:900; so this provision would not apply to this Plan even if Plaintiff had asked for specific relief. Third, the court rejected Plaintiff’s claim for statutory penalties against LINA for failing to provide Plan Documents in a timely fashion under 29 USC 1132(c) because the Court interpreted LINA’s responses not as refusing to provide the requested documentation; rather, “it appears that the plan documents themselves were simply overlooked.” (The Court did not explain this legal distinction.) Additionally, the court found that Plaintiff was not prejudiced by the delay, and most importantly, penalties can only be imposed upon the plan itself, not the third party administrator. Plaintiff failed to request penalties against the plan, only requesting them from LINA.

ERISA Preemption

Third Circuit

Metro. Life Ins. Co. v. Lawless, et al., No. CV1913688MASZNQ, 2019 WL 6050755 (D.N.J. Nov. 15, 2019) (Magistrate Judge Zahid N. Quraishi). This case involves a dispute over three ERISA life insurance policies, wherein the decedent changed the beneficiaries from his brother (William), ex-wife (Cari), and children to his new wife (Dena). Dena filed a complaint in state court seeking herself declared an omitted spouse in light of the MSA between decedent and Cari which provided that decedent would maintain life insurance policies for her and the children. MetLife filed an interpleader action naming Dena, Cari, William and the children as defendants, stating that it was ready and willing to pay benefits and asking the court to allow it to deposit the funds into the Registry so it does not have to remain a party to the action. Cari and William moved for stay of the action to resolve the family law action pending resolution of the family law counterclaim to Dena’s complaint filed by the children, arguing that the children would be permitted to assert their claim for constructive trust, and were permitted to assert claims of undue influence and lack of capacity irrespective of the federal preemption defense. MetLife asserted no preference as to where the case was litigated once it was no longer a party, but supported continuing the action in federal court until it was provided interpleader relief. The court decided that irrespective of the state court actions that were pending, a stay was not appropriate at the time because: 1) the family law action of the children and the probate action were of a different character, because the family action involved the MSA and the probate law action embodies the entire controversy that would be heard in federal court; and 2) even if the probate action was parallel to the federal action, it would defy Congress’s intent in enacting the interpleader statute to stay these proceedings and leave MetLife in limbo while the state action is decided.

Sixth Circuit

Southern Ohio Medical Center v. Griffith and Countryside Rentals, Inc., 19-cv-261, 2019 WL 5884280 (S.D. Ohio Nov. 2019) (Magistrate Judge Karen L. Litkovitz). This matter was before the court on Plaintiff’s (“SOMC”) motion to remand the case to state court and Defendant Countryside Rental, Inc.’s opposing motion. Plaintiff filed its action in state court asserting two claims one to collect payment for medical services rendered to Defendant Griffith, the other claim asserted that Griffith’s employer, Defendant Countryside pre-approved and agreed to pay for those services through its third-party administrator. Defendant Countryside removed the action to federal court on the ground that Plaintiff (“SOMC”) seeks to recover benefits under an employee welfare benefit plan, and Plaintiff’s claims are completely preempted by ERISA. Plaintiff argued that the federal court lacks subject matter jurisdiction over the complaint because SOMC, a healthcare provider, has no connection to the ERISA plan that provided healthcare coverage for Griffith, Countryside’s employee. SOMC alleged that the “self- insured insurance plan” did “not have a provider contract with [SOMC].” Plaintiff alleged that ERISA would be implicated only if Countryside’s employee, Griffith, were to sue Countryside, his employer/insurer, “for coverage problems with his ERISA plan.” Plaintiff contended that because this is instead a collection suit brought against Griffith and his insurer Countryside, which allegedly pre-approved Griffith’s care, the suit has no connection to ERISA. Plaintiff asserted that the case must therefore be remanded to state court. Defendants opposed Plaintiff’s motion to remand asserting that Plaintiff’s claims involve a dispute as to the amount owed under an ERISA plan for health care services provided by an out-of-network provider (SOMC) for services that the Plan’s third-party administrator allegedly pre-approved. Defendants alleged that as such, Plaintiff’s claims are completely preempted by ERISA, and the Court has jurisdiction over Plaintiff’s claims. Defendants argued that Plaintiff’s claims are preempted by ERISA because Plaintiff brings the lawsuit as the assignee of benefits from Griffith’s ERISA plan, and the complaint does not allege that Defendants have any independent legal duty. Defendants alleged that SOMC has stepped into Griffith’s shoes as the assignee of benefits and seeks to recover additional benefits from Griffith’s healthcare plan as payment for SOMC’s services. Defendants argued that Plaintiff’s claims arise from and relate to administration of an ERISA plan, and SOMC has standing as an assignee of benefits to bring an ERISA claim to recover benefits allegedly due under the plan.  The court found that Defendants properly removed the case to federal court. The court applied the Davila Test (the two-prong test established by the Supreme Court to determine whether federal preemption is appropriate) and found that both prongs were satisfied.  Accordingly, it recommended that Plaintiff’s motion to remand this case to state court be denied.

Ninth Circuit

Health Net Life Insurance Co. v. Morningside Recovery, LLC et al., No. SACV191342DOCDFM, 2019 WL 6039950 (C.D. Cal. Nov. 13, 2019) (Judge David O. Carter). Plaintiff filed an action in state court alleging common law fraud, intentional interference with contractual relations, violation of Cal. Bus. & Prof Code §§ 17200 et seq., and sought declaratory relief, based on alleged certain practices of substance abuse service providers which involved using “body-brokers” and “purchased patients” where the service providers paid premiums for these patients (who were usually homeless and uninsured) and then billed excessive amounts, and when they could no longer bill, they stopped paying the premiums. Defendants removed the case to federal court, alleging that ERISA applied. Plaintiffs contended that none of the insurance policies at issue were employer plans regulated by ERISA. The court agreed and remanded the case back to state court, finding that the complaint detailed a scheme in which treatment providers helped “purchased patients” fraudulently obtain individual policies.

Medical Benefit Claims

Fifth Circuit

Ariana M. v. Humana Health Plan of Texas, Inc., No. 18-20700, __F.App’x__, 2019 WL 5866677 (5th Cir. Nov. 8, 2019) (Before Clement, Haynes, and Willett, Circuit Judges). See Notable Decision summary.

Pension Benefit Claims

Second Circuit

DuBuske v. PepsiCo, Inc., No. 18 CV 11618, 2019 WL 5864995 (S.D.N.Y. Nov. 8, 2019) (Judge Vincent L. Briccetti).  Plaintiffs filed a Motion for Reconsideration of the Court’s grant of Defendants’ Motion to Dismiss. In its prior decision, the Court threw out a putative class action against PepsiCo, Inc., Pepsi’s Employee Benefits Board, and Pepsi’s Administrative Committee. The case was brought by Participants who elected early retirement benefits under Pepsi’s Salaried Employees Retirement Plan, a defined benefit plan. The suit alleges the annuity factors used for calculating a benefit with a survivor annuity are “fixed conversation factors” rather than standard annuity factors based on current interest rates and life expectancy at the time retirement commences and violates Section 203 of ERISA, ERISA’s anti-forfeiture provision. The Court found the anti-forfeiture provision applies only to benefits that commence at “normal retirement age.” Because Plaintiffs’ claims were based on early retirement benefits, the court ruled the anti-forfeiture provision does not apply and the complaint was dismissed for failure to state a claim. In their Motion for Reconsideration, Plaintiffs argued section 205(d) of ERISA applies which requires that a form of benefit with a survivor annuity be calculated for the life of a participant and which is the “actuarial equivalent” of a single annuity for the life of the participant. The Court granted leave to amend to allege the claims “with the utmost clarity” under ERISA § 205(d) only.

Pleading Issues & Procedure

Second Circuit

Reliant Transp., Inc. v. Div. 1181 Amalgamated Transit Union – N.Y. Emps. Pension Fund, No. 18-cv-04561, 2019 WL 6050345 (E.D.N.Y. Nov. 14, 2019) (Senior Judge I. Leo Glasser).  On a Rule 12(b)(6) motion to dismiss, the Court granted in part and denied in part Defendants Division 1181 A.T.U. – New York Employees Pension Fund (“Pension Fund”) and four of its labor-side trustees’ motion to dismiss four claims made by Plaintiffs Reliant Transportation, Inc. (“Reliant”) and Sonny Chaitram’s (an employee of Reliant and vested participant in the Pension Fund). Plaintiffs brought four claims—(1) a claim for breach of trust under New York law (Count I), (2) a cause of action under ERISA § 4301 (Count II), (3) a breach of fiduciary duty cause of action under ERISA § 502(a)(3) (Count III), and (4) a claim for breach of fiduciary duty under New York law (Count (IV)—against the Pension Fund relating to allegations that (1) the Pension Fund’s labor-side trustees violated the Pension Fund’s governing Trust Agreement by maintaining employer trustees on the Board who did not properly represent employers, and (2) by refusing to appoint an employer-side trustee from Reliant (the largest employer contributor to the Pension Fund) to the Board of Trustees, breaking the Trust Agreement’s required equal employer-labor side Board representation (four labor, four employer). Specifically, Plaintiffs alleged that Defendants failed to fill an employer trustee vacancy within the period of time set out by the Trust Agreement and provided “false or misleading” information to Reliant regarding the status of the vacancy. Of the four claims brought by Plaintiffs—two ERISA-based claims and two New York state claims—the Court at its own discretion reviewed Defendants’ motion to dismiss under 12(b)(1) assessing whether Plaintiff Chaitram had constitutional standing to bring any of the four claims.  The Court’s analysis turned on whether Chaitram had properly alleged an injury-in-fact when alleging that the “Board’s lack of equal representations could result in a series of employer-adverse decisions, creating a ‘growing risk’ that Reliant will withdraw from the Pension Fund.” The Court recited a substantial review of relevant case law to hold that Chaitram had standing to bring these four claims because the mere allegation of an “increased risk” of injury “is itself an injury” and therefore not too hypothetical to supply a basis for Article III standing. However, the Court denied Defendants’ motion to dismiss as to Count III, while dismissing Counts I, II, and IV, finding that ERISA § 4301 underlying Count II did not apply and that Counts I and IV were preempted by ERISA.

Third Circuit

Beacon Sales Acquisition, Inc. V. Board of Trustees of the Teamsters Industrial Employees Pension Fund, No. 19-19106, 2019 WL 5884727 (D.N.J. Nov. 12, 2019) (Judge Kevin McNulty). Beacon Sales Acquisition, a signatory to the collective bargaining agreement with the Teamsters Local Union No. 560 which requires contributions to be made to the Teamsters Industrial Employees Pension Fund and Welfare Fund, filed for a preliminary injunction from arbitration. After becoming delinquent on its contributions to the Funds, the Trustees set a hearing to arbitrate the dispute for December 16, 2019.  Beacon argued that although it signed the CBA, it never signed the Trust Indentures which contain the arbitration provision and is, therefore, not subject to arbitration.  The Court gave a lengthy analysis of the doctrine of incorporation by reference. The Court explained that the CBA makes clear reference to the Trust Indenture and in the CBA Beacon agreed “to make contribution…and participate in the…Funds, pursuant to the Trust Indenture, its rules and regulations as amended.” (citation omitted). Beacon’s agreement to the CBA showed a clear intent to be bound by the Trust Indentures.  The Court further found that Beacon was or should have been aware of the nature of the trust when it agreed to contribute to it. The Court denied Beacon’s request for injunction.

Provider Claims

Eleventh Circuit

GVB MD, LLC v. Blue Cross and Blue Shield of Florida, 19-20455-Civ-Moreno, 2019 WL 58892000 (S.D. Fla. November 12, 2019) (Judge Federico A. Moreno). The court ruled in favor of Defendant, granting its motion to dismiss, holding that Plaintiff, Miami Back and Neck Specialists, lacked standing to sue because the assignments of benefits by insureds were invalid. Plaintiff, a medical practice brought two claims for breach of contract and declaratory judgment against Defendant Blue Cross and Blue Shield of Florida related to an alleged denial of insurance benefits arising under an ERISA plan. Plaintiff alleged in its amended complaint that its doctors performed spine surgery and related services on three patients, that the patients assigned their benefits from their ERISA plans and that Defendant has failed to pay. In response, Defendant filed a motion to dismiss, arguing that Plaintiff lacks standing to sue because the assignments of benefits were invalid. Defendant attached to its motion the three insureds’ health benefits plans which each included anti-assignment language. Plaintiff contested dismissal by arguing that Defendant, through its prior course of dealings, waived or is estopped from relying on the anti-assignment provisions. Upon review of the record, the Court agreed that for the reasons cited in the motion to dismiss, Plaintiff lacks standing to sue under the unambiguous terms of the insureds’ health plans. The court noted that, the Eleventh Circuit Court of Appeals recently reaffirmed that in order to maintain an action under ERISA, a plaintiff must have standing to sue under the statute, which is not jurisdictional, Article III standing, but rather a right to make a claim under the statute. The court held that there are generally only two categories of persons who have a right to make a claim under an ERISA plan: beneficiaries and participants. Healthcare providers are neither and thus lack independent standing to sue. The court also noted that the Eleventh Circuit recognizes that healthcare providers may obtain derivative standing through a written assignment of benefits by a plan beneficiary or participant. Finally, the court noted that the Eleventh Circuit also recognizes that unambiguous, anti-assignment provisions in ERISA-governed welfare benefit plans are valid and enforceable, and will operate to void the assignment, leaving the healthcare provider without derivative standing and thereby unable to maintain the ERISA action. Because the Defendant was able to show a clear anti-assignment provision in each of the three patients’ health plans, the court found that Plaintiff lacked derivative standing to bring the ERISA action and granted Defendant’s motion to dismiss. The court also was not persuaded by Plaintiff’s arguments that waiver or estoppel would work to grant it standing in this case.


Ninth Circuit

Metropolitan Life Ins. Co. v. Gicana, et. al., No. 18-55785, No. 18-55989, No. 18-56174, 2019 WL 5957422 (9th Cir. Nov. 13, 2019) (Before Jerome Farris, Margaret McKeown, Ninth Circuit Judges, Barrington D. Parker, Second Circuit Judge sitting by designation). This case was initiated as an interpleader action by MetLife. Araceli Maloney and Bambi Gicana were named as Defendants-in-Interpleader and the parties stipulated to the dismissal of MetLife. In the course of reviewing Gicana’s claims that Maloney had breached her fiduciary duty to the Trust, additional funds that were in the Decedent’s 401(k) entered the dispute before the District Court. The parties agreed that these funds were assets of the Trust. The District Court concluded that Maloney had violated her fiduciary duties by diverting Trust assets—the 401(k) funds—into her own retirement account. The evidence also established that Maloney had used those funds for unauthorized personal expenditures. Accordingly, the District Court imposed an equitable lien in favor of the Trust on Maloney’s personal IRA and required her to provide the Trust with an accounting and to restore improperly disbursed funds. Maloney argued that her IRA was an exempt asset that cannot be the subject of an equitable lien. Maloney contended this result was compelled by Rousey v. Jacoway, 544 U.S. 320, 326 (2005), and Cal. Code Civ. Proc. Section 704.115. Rousey involved exemptions from bankruptcy estates and the statute concerned exemptions from money judgments, not immunity from equitable liens. Thus, the Ninth Circuit saw no merit in Maloney’s contentions, noting a court may hold a fiduciary personally responsible for a breach of fiduciary duty under ERISA and impose appropriate equitable remedies. Because Gicana traced the 401(k) funds to Maloney’s personal IRA, the District Court correctly imposed the lien against that account.

Eleventh Circuit

Keys v. Bert Bell/Pete Rozelle NFL Player Ret. Plan, No. 8:18-CV-2098-T-36JSS, 2019 WL 5887172 (M.D. Fla. Nov. 12, 2019) (Judge Charlene Edwards Honeywell). This case involves a benefit plan with multiple classifications for disability benefits which vary depending on the extent of impairment and whether impairments are due to playing NFL football. Defendants approved and paid certain benefits to Plaintiff for several years pursuant to a determination that Plaintiff’s disability arose from playing NFL football. Later, Defendants terminated Plaintiff’s benefits asserting that, based on evidence that Plaintiff had been in a car accident several years earlier, he was not eligible for the tier of benefits he had been receiving and a significant overpayment to Plaintiff had resulted. The court considered Plaintiff’s count for “Equitable Estoppel Based Upon Silence” under § 1132(a)(1)(B). Plaintiff asserted that Defendants should be estopped from clawing back benefits already paid to him because Defendants knew about the car accident earlier but had intentionally remained silent for 13 years while continuing to pay his benefits. The court noted that ERISA preemption has an expansive sweep relative to state laws and that the Eleventh Circuit has recognized only a very narrow common law doctrine for estoppel when a plaintiff can show (1) the relevant plan provisions at issue are ambiguous and (2) the plan provider or administer has made representations to the plaintiff that constitute an informal interpretation of the ambiguity. Jones v. Am. General Life and Acc. Ins. Co., 370 F.3d 1065, 1069 (11th Cir. 2004). The court determined that Plaintiff’s claim does not fit the Jones framework for an estoppel claim because Plaintiff was not seeking to obtain benefits, but, rather, was seeking to retain benefits already paid to him. The court was not convinced it should recognize a new type of equitable estoppel because the Eleventh Circuit indicated equitable estoppel under § 1132(a)(1)(B) should be allowed under only one specific circumstance. The court also considered whether Plaintiff had another “adequate remedy” under § 1132(a)(1)(B) and determined that Plaintiff still had a potential claim for breach of fiduciary duty under ERISA. The court granted Defendant’s motion to dismiss as to this count of equitable estoppel.

Statute of Limitations

Eleventh Circuit

Abdul-Aziz v. Nat’l Basketball Ass’n, Players’ Pension Plan, No. 19-782-CV, __F.App’x__, 2019 WL 5883625 (2d Cir. Nov. 12, 2019) (PRESENT: José A. Cabranes, Reena Raggi, Circuit Judges, Edward R. Korman, District Judge). The Second Circuit affirmed the district court’s judgment that Plaintiff’s claims were barred by the statute of limitations for ERISA actions. The court determined that Plaintiff had received sufficient notice of repudiation of his benefits when the Plan terminated its payments to him. Plaintiff failed to file his complaint within the next six years as required by New York law which provided the relevant limitations period for this case.

Withdrawal Liability & Unpaid Contributions

Second Circuit

Trustees of The New York City District Council of Carpenters Pension Fund v. Win Belleville, LLC, No. 18 CIV. 5376 (ER), 2019 WL 5957293 (S.D.N.Y. Nov. 12, 2019) (Judge Edgardo Ramos).  The court granted Petitioners’ motion and confirmed the arbitration award in the amount of $37,420.34 against Win Belleville, LLC d/b/a Win Development Inc. plus interest at a rate of 5.75% per annum accruing from May 10, 2018 until the date of entry of judgment. The court also awarded $647.50 in attorneys’ fees and $75 in costs and post-judgment interest as mandated in 28 U.S.C. § 1961.

Trustees of Ne. Carpenters Health v. Drywall & Acoustics of Ne., Inc., No. 19-CV-4600 (NG)(RML), 2019 WL 5963689 (E.D.N.Y. Nov. 12, 2019) (Judge Gershon).  The court granted Petitioners’ unopposed motion for summary judgment confirming the first arbitration award in the amount of $11,470.79 and the second arbitration award in the amount of $69,968.52.

Fourth Circuit

International Painters & Allied Trades Industry Pension Fund, et al. v. Finch Industrial Coatings LLC, et al, No. 18-CV-02333-ELH, 2019 WL 6044197 (D. Md. Nov. 15, 2019) (Magistrate Judge J. Mark Coulson).  The court granted Plaintiffs’ Motion for Judgment by Default and awarded Plaintiffs:  $30,804.05 in contributions, $2,899.06 in interest, $6,160.81 in liquidated damages, and $17,303.15 in attorney’s fees and costs.

Your ERISA Watch is made possible by the collaboration of the following Kantor & Kantor attorneys:  Brent Dorian BrehmBeth Davis, Sarah DemersElizabeth GreenAndrew Kantor, Monica Lienke, Susan Meter, Michelle RobertsTim Rozelle, Peter Sessions, and Zoya Yarnykh.


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