Sixth Circuit Rules Plan Terms are “Irrelevant” When Considering Equitable Claim

The Sixth Circuit is fast making itself the center of case law on equitable remedies under ERISA. In Pearce v. Chrysler Group LLC Pension Plan, 2015 WL 3797385 (6th Cir. June 18, 2015), the court held that a material conflict between an SPD and the plan permits a claim for equitable relief, apparently without any other element (like reliance) being required. For more discussion of the Sixth Circuit rulings on this subject in the last year or so, see Rochow 1, Rochow 2, and Stiso. Continue reading

Sixth Circuit At it Again: Orders Make-Whole Relief in Disability Benefit Claim

In Stiso v. Intl. Steel Group, 2015 WL 3555917 (6th Cir. June 9, 2015), the court reversed a ruling by the district court that dismissed a claim for make-whole relief, and directed the district court “to grant an equitable remedy [against the employer and insurer] equivalent to the promised increase in benefits to plaintiff.”

The decision was written by Judge Merritt, a senior judge who did not participate in the en banc decision in Rochow v. Life Ins. Co. of N. Am., 780 F.3d 364 (6th Cir. 2015), which rejected a claim for make-whole relief in the form of disgorgement of profits. The Stiso panel also included Judge Boggs, who was in the majority in Rochow, and Judge Stranch, who had issued the lengthy dissent in Rochow. Continue reading

ERISA Claim Accrues Upon Clear Repudiation of Claim, Even if There is No Formal Denial Letter

In Witt v. Metro. Life Ins. Co., 772 F.3d 1269 (11th Cir. 2014), the court answered the question: “what happens when the defendant says it issued a formal denial letter and the plaintiff says he never received the letter, but it is undisputed the defendant terminated benefits and did not pay the plaintiff any benefits for 12 years?” Continue reading

Beneficiary Designation Forms Are not Plan Documents; Change of Beneficiary By Phone Was Sufficient

In Becker v. Williams, — F.3d –, 2015 WL 348872 (9th Cir. Jan. 28, 2015), the plan participant called the plan administrator to change the beneficiary of his pension plans from his ex-wife to his son. His employer sent him beneficiary change forms, but he never completed them in the years before he died. After his death, both the son and ex-wife claimed the benefits, and the employer interpleaded. Continue reading

Ninth Circuit Replaces Gabriel Decision On Equitable Remedies; Modifies Interpretation of Amara

We previously reported on Gabriel v. Alaska Electrical Pension Fund, 755 F.3d 647 (9th Cir. 2014), which addressed limits on make-whole relief under 1132(a)(3), and affirmed judgment for the plan fiduciary. That decision was a divided one, with a partial dissent by Judge Berzon. In December, the panel withdrew its earlier decision, and replaced it with a new decision, Gabriel v. Alaska Electrical Pension Fund, — F.3d –, 2014 WL 7139686 (9th Cir. Dec. 16, 2014). The new decision affirmed summary judgment on two of the three measures of damages, and remanded to the district court on the third. Continue reading

Eighth Circuit Enforces Choice of Law Clause; Discusses Test for Evaluating Reasonableness of Plan In-terpretation

In Brake v. Hutchinson Tech. Inc. Grp. Disability Income Ins. Plan, 774 F.3d 1193 (8th Cir. 2014), the court determined that, where a policy insuring a South Dakota resident was issued in Minnesota to a Minnesota employer, and provided that it was governed by Minnesota law, then a South Dakota regulation precluding discretionary clauses could not apply.

The court then turned to the primary issue, which is whether the administrator reasonably interpreted the plan’s pre-existing condition clause. Along the way to deciding that the interpretation was reasonable, the court summarized the elements to be considered: “Our analysis of the reasonability of Hartford’s plan interpretation is informed by the following factors: whether the decision is consistent with plan goals; whether it renders plan terms meaningless or is internally inconsistent; whether the decision complies with ERISA; whether the plan has previously interpreted the terms at issue consistently; and whether the interpretation was contrary to the clear language of the plan.” Here, the court held that the interpretation was compelled by the clear language of the plan.

Eighth Circuit Leaves Open Possibility That Procedural Irregularities Can Preclude Discretionary Review

In Johnson v. United of Omaha Life Ins. Co., 775 F.3d 983 (8th Cir. 2014), the court determined that the district court erroneously reviewed the administrator’s determination under the de novo standard, instead of the arbitrary and capricious standard. It ruled that it did not need to decide whether procedural irregularities still could result in a change of the standard of review. Continue reading

Insurer Reasonably Denied AD&D Claim Following “Suicide By Cop”

In Rice v. ReliaStar Life Ins. Co., 770 F.3d 1122 (5th Cir. 2014), the police responded to a 911 call about the decedent, Rice, sitting in his car, in his garage, with a gun to his head, threatening suicide. After various failed efforts by the police to get him to surrender, he walked toward the police, refused to drop his gun, said “I want to commit suicide,” and was shot and killed. Continue reading

Court Provides Narrow Interpretation for Mental Illness Limitation

In George v. Reliance Standard Life Ins. Co., 776 F.3d 349 (5th Cir. 2015), a case of first impression, a divided Fifth Circuit panel decided when a disability is “caused by or contributed to by” a mental illness. The plaintiff was a helicopter pilot who was disabled due to pain suffered at the site of a leg that had been amputated before he started the job in question. He also suffered from depression and PTSD. The insurer determined that he could perform sedentary work, but that his mental illnesses would prevent him from working. Thus, the insurer concluded that the mental illness “’contributed to’ his overall impairment status,” resulting in the application of the mental illness limitation in the policy. Continue reading

Coordination-of-Benefits Claim Is Not Equitable

In Central States, Southeast & Southwest Areas Health & Welfare Fund v. Gerber Life Ins. Co., 771 F.3d 150 (2d Cir 2014), the Second Circuit joined the Fifth Circuit in ruling that an ERISA health plan generally has no equitable remedy against another insurer in a coordination of benefits dispute. Continue reading