Category Archives: Benefit Claims & Claims Process Litigation

Supreme Court Agrees To Consider Yet Another “Presumption” Out Of The Sixth Circuit: That Retiree Health Care Benefits Are Intended To Be Vested For Life, Absent Clear Plan Or Bargaining Agreement Language To The Contrary

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In the ERISA world, the Supreme Court has already granted a petition for certiorari of a Sixth Circuit case in order to consider one significant “presumption” this term – when it agreed to evaluate whether the Moench “presumption of prudence” regarding employer stock is a proper legal standard for evaluating breach of fiduciary duty claims. However, on May 5, the high court granted a petition for certiorari of yet another Sixth Circuit case regarding yet another significant presumption – this time, the judicially-crafted presumption that retiree health benefits [...] Read more
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Controversial Sixth Circuit Panel’s Decision on Disgorgement of Profits in ERISA Disability Benefits Case Set for Oral Argument in Rehearing En Banc

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In Rochow v. Life Ins. Co. of Am., 737 F.3d 415 (6th Cir. 2013), a panel of judges for the Sixth Circuit awarded an ERISA disability benefits claimant’s estate not only the amount of benefits that the participant was owed, but also a disgorgement award under ERISA § 502(a)(3). Dissenting, the Hon. David McKeague remarked that the Sixth Circuit panel took “an unprecedented and extraordinary step to expand the scope of ERISA coverage. The disgorgement of profits undermines ERISA’s remedial scheme and grants the plaintiff an astonishing $3,797,867.92 windfall under the catchall [...] Read more
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Unresolved Claim For Attorney’s Fees Does Not Prevent Judgment From Becoming “Final”

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The facts of Ray Haluch Gravel Co. v. Cent. Pension Fund of Int’l Union of Operating Engineers & Participating Employers, 134 S. Ct. 773 (2014)are straightforward. Petitioner Ray Haluch Gravel Co. (“Haluch”) is a landscape supply company required to pay contributions to union-affiliated benefit funds under a collective-bargaining agreement. Respondents are various funds who sued under ERISA for the required contributions. During the lower court proceedings, the district court entered judgment on the merits in favor of the funds. At the time the judgment was entered, the funds [...] Read more
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Supreme Court Upholds Plan’s Limitation Period That Begins To Run Before A Final Denial

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ERISA does not generally provide a statute of limitations for claims for benefits. Therefore, courts will generally use the statute of limitations for breach of contracts action from the state where the court is located to determine the appropriate limitations period. In other words, if a case is filed, as this case was, in the United States District Court for the District of Connecticut, the court will use the Connecticut state law statute of limitations for breach of contract actions for ERISA benefit claims. However, ERISA plans may set their own contractual limitations periods which will be [...] Read more
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Tenth Circuit Says “Enough is Enough” And Rejects Plan Participants’ Belated Attempt To Add Vague Claims For “Equitable Relief” Post-Amara

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In Jensen, pension plan participants brought a putative class action against Solvay (the “Company”) arising from the Company’s decision to convert the pension plan from a “fixed-benefit” to “cash-balance formula.” Though ERISA did not prohibit Solvay (both the plan’s sponsor and its administrator) from making this move, ERISA did require the Company to provide its employees with detailed notice of the changes. See ERISA § 204(h), 29 U.S.C. § 1054(h). The employees brought suit, and after the District Court ruled in favor of the Company, [...] Read more
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Seventh Circuit: Participant May Be Entitled To “Make-Whole” Surcharge If Incorrect Coverage Information Caused Decision To Have Surgery

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In Kenseth v. Dean Health Plan, Inc., No. 11-1560, 2013 WL 2991466 (7th Cir. June 13, 2013) (“Kenseth II”), the plaintiff had undergone gastric banding in 1987 which, 18 years later in 2005, caused severe acid reflux and other complications. Plaintiff’s doctor recommended that she have another procedure to remedy the problems caused by the prior surgery. The plan at issue, insured by the defendant, excluded coverage for surgical treatment of morbid obesity and services related to a non-covered benefit. However, the plan certificate instructed participants to call a phone number [...] Read more
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Rosy Relief in Sight for the Plan in CGI Technologies & Solutions v. Rose

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On April 22, 2013, the Supreme Court granted the petition for a writ of certiorari in CGI Technologies & Solutions v. Rose, et al., and then immediately vacated and remanded the Ninth Circuit’s judgment in light of US Airways, Inc. v. McCutchen, No. 11-1285, 2013 WL 1567371 (U.S. Apr. 16, 2013). In McCutchen, the Supreme Court issued a two-part opinion in which it held that (1) equitable principles cannot override clear plan terms, but (2) equitable principles can be used to construe ambiguous or missing plan terms. Last June, we blogged about CGI Technologies & Solutions v. Rose [...] Read more
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Fourth Circuit Joins Third Circuit In Holding ERISA Does Not Preempt Post-Distribution Suits Against Beneficiaries

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The situation in Andochick is not at all uncommon when couples divorce: Scott Andochick and Erika Byrd were married. During the marriage, Erika participated in a 401(k) plan and a life insurance plan with her employer, and executed beneficiary designations for both plans, naming Scott as her primary beneficiary. Scott and Erika separated and entered into a marital settlement agreement. In the agreement, Scott “waive[d] any interest, including but not limited to any survivor benefits, which he may have” in Erika’s 401(k) plan, and he released and relinquished any future rights [...] Read more
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Claims Spanning Decades, Ten Subclasses No Problem for ERISA Class Cert Bid in Seventh Circuit

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In Johnsonv. Meriter Health Services Employee Retirement Plan, — F.3d —-, 2012 WL 6013457 (7th Cir. Dec. 4, 2012), participants in a defined benefit plan sponsored by their employer, Meriter Health Services (“Meriter”), filed a putative class action under ERISA, alleging that they had not been credited with all pension benefits to which the plan entitled them. The putative class consisted of more than 4,000 participants in the Meriter pension plan. Some of the class members had received benefits 23 years ago, and now claim the benefits are inadequate. Other class members [...] Read more
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Ninth Circuit Finds The “Fiduciary Exception” To The Attorney-Client Privilege Extends To Insurance Companies Acting As Fiduciaries To ERISA Plans

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In a matter of first impression, the Ninth Circuit recently held that the attorney-client privilege does not apply to communications between an insurer and counsel before a claims decision is made. Creating a split with the Third Circuit, the Ninth Circuit held that the “fiduciary exception” to the attorney-client privilege should be extended to insurers that administer benefit plans governed by ERISA, and acting in a fiduciary capacity. See Stephan v. Unum Life Ins. Co. of Am., No. 10-16840l, — F.3d —-, 2012 WL 3983767 (9th Cir. Sept. 12, 2012). This is a chilling decision [...] Read more
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