Justia U.S. 4th Circuit Court of Appeals Opinion Summaries

The Employee Retirement Income Security Act’s Section 502(a)(1)(B) allows a beneficiary to “recover benefits due to him under the terms of his plan.” And ERISA’s Section 502(a)(3) allows a beneficiary to sue for “other appropriate equitable relief.” This case requires us to answer when—and under what conditions—a plaintiff may seek monetary relief under one of those provisions. Plaintiff’s son had a rare heart condition. He died at the age of twenty-seven, awaiting a heart transplant, which Plaintiff says that Defendants—who administered her son’s employer-based health benefits program—wrongfully denied. So she sued on behalf of his estate, seeking monetary relief under both Section 502(a)(1)(B) and 502(a)(3). The district court dismissed both claims. As to Plaintiff’s (a)(1)(B) claim, the court held that money was not one of the “benefits” that her son was owed “under the terms of his plan.” And, as to her (a)(3) claim, the court held that her requested monetary relief was too similar to money damages and was thus not “equitable.”   The Fourth Circuit affirmed in part and vacated in part. The court explained that the district court correctly held that money was not one of the “benefits” that Plaintiff’s son was “due” “under the terms of his plan.” So it was right to dismiss her (a)(1)(B) claim. However, the court explained that it must vacate its complete dismissal of Plaintiff’s (a)(3) claim. While the district court correctly noted that compensatory, “make-whole” monetary relief is unavailable under Section 502(a)(3), it did not consider whether Plaintiff plausibly alleged facts that would support relief “typically” available in equity. View "Jody Rose v. PSA Airlines, Inc." on Justia Law

Plaintiff’s son had a rare heart condition. He died at the age of twenty-seven, awaiting a heart transplant, which Rose says that Defendants—who administered her son’s employer-based health benefits program—wrongfully denied. So she sued on behalf of his estate, seeking monetary relief under both Section 502(a)(1)(B) and Section 502(a)(3). The district court dismissed both claims. As to Plaintiff’s (a)(1)(B) claim, the court held that money was not one of the “benefits” that her son was owed “under the terms of his plan.” And, as to her (a)(3) claim, the court held that her requested monetary relief was too similar to money damages and was thus not “equitable.”   The Fourth Circuit affirmed in part and vacated in part. The court explained that the district court correctly held that money was not one of the “benefits” that Plaintiff’s son was “due” “under the terms of his plan.” So it was right to dismiss her (a)(1)(B) claim. But the court explained that it must vacate its complete dismissal of Plaintiff’s (a)(3) claim. The court explained that while the district court correctly noted that compensatory, “make-whole” monetary relief is unavailable under Section 502(a)(3), it did not consider whether Plaintiff plausibly alleged facts that would support relief “typically” available in equity. The court thus remanded for the district court to decide in the first instance whether Plaintiff can properly allege such a theory based on a Defendant’s unjust enrichment, including whether an unjust gain can be followed to “specifically identified funds that remain in Defendant’s possession” or to “traceable items that the defendant purchased with the funds.” View "Jody Rose v. PSA Airlines, Inc." on Justia Law

On behalf of a class, Plaintiff sued Aon Hewitt Investment Consulting for investment advice given to Lowe’s Home Improvement to help manage its employees’ retirement plans. Aon, first as an investment consultant and later as a delegated fiduciary, owed the plan fiduciary duties under the Employee Retirement Income Security Act. Plaintiff claimed that Aon’s conduct violated the core duties of loyalty and prudence. After a five-day bench trial, the district court held that Aon, in fact, did not breach its fiduciary duties. Plaintiff appealed.   The Fourth Circuit affirmed. The court explained that the district court that Aon’s recommendation was not motivated by self-interest. And Plaintiff’s contention that Aon’s research conducted before it was Lowe’s delegated fiduciary could not discharge its duty of prudence also falls short. Aon engaged in a reasoned decision-making process by reviewing comparable funds. It makes no difference here that the review occurred when it established the fund (which was before Aon became Lowe’s delegated fiduciary). Plus, it continued to monitor the fund. So Aon did not violate the duty of prudence. View "Benjamin Reetz v. Aon Hewitt Investment Consulting, Inc." on Justia Law

Plaintiff sued Zurich American Life Insurance Company of New York∗ (“Zurich”) in district court challenging Zurich’s denial of long-term disability (“LTD”) benefits under the Employment Retirement Income Security Act of 1974 (“ERISA”). The parties cross-moved for judgment on the record, and the district court awarded judgment to Zurich. Plaintiff appealed.   The Fourth Circuit affirmed. The court held that Zurich’s decision to deny benefits followed a principled reasoning process and was supported by substantial evidence. The court explained that Plaintiff insists that Zurich abused its discretion by failing to evaluate his particular job responsibilities in determining his disability status. The court explained that Plaintiff misunderstands what the Plan requires. The Plan defines “Regular Occupation” as “the occupation [the employee is] routinely performing when [his] disability begins.” And the Plan explains that Zurich “will look at [the employee’s] occupation as it is normally performed in the national economy, instead of how the work tasks are performed for a specific employer or at a specific location.” Of note, Zurich completed and considered a “Physical Requirements and Job Demand Analysis” that evaluated Plaintiff’s job responsibilities. That analysis concluded that his writer/editor position was a sedentary one that required minimal physical exertion. Under the Plan, it was Plaintiff’s burden, not Zurich’s, to provide “written proof of [his] claim for disability benefits.” Thus, Zurich did not abuse its discretion by not obtaining additional vocational evidence, as neither the Plan nor case law affirmatively requires it to have done so. View "Kevin Geiger v. Zurich American Insurance Company" on Justia Law

After the decedent died, Plaintiff, his surviving spouse, filed suit seeking relief under a provision of the Employee Retirement Income Security Act allowing “a participant or beneficiary” of an employee benefit plan “to recover benefits due” “under the terms of [the] plan.” The parties submitted a joint stipulation of facts and an administrative record and cross-moved for judgment based on those undisputed materials. The district court entered judgment for Prudential. The court concluded Prudential “reasonably denied Plaintiff’s request for benefits” because “decedent received timely notice of his conversion rights” and “did not convert his life insurance to an individual policy during the conversion period.” The district court also rejected Plaintiff’s request to “apply the doctrine of equitable tolling and find that Plaintiff is entitled to the life insurance benefits she seeks.”   The Fourth Circuit affirmed. The court wrote that it agreed with the district court that the plan administrator did not abuse its discretion in concluding Plaintiff was not entitled to benefits under the terms of the plan. The court explained that “Employers have large leeway to design [employee benefit] plans as they see fit,” but “once a plan is established, the administrator’s duty is to see that the plan is maintained pursuant to that written instrument.” Here, Prudential did not abuse its discretion by fulfilling its duty here, and the district court correctly resolved the single claim before it based on the agreed-on facts and consistent with well-established law. View "Kathy Hayes v. Prudential Insurance Company of America" on Justia Law

Appellant American Federation of State, County and Municipal Employees, Council 3 (“Appellant”) filed suit against the State of Maryland alleging that the State breached a statutorily formed contract with current state employees to provide them with certain prescription drug benefits upon retirement. The district court agreed that Maryland law created a contract, it held that the contract was unilateral in nature and that the promised benefits do not vest until an employee retires with sufficient years of service. The district court determined that the current employees represented by Appellant had no vested contractual right to the retirement prescription drug benefits and dismissed the complaint.   The Fourth Circuit affirmed. However, the court did so because it found that the statutory language does not create a contract with state employees. The court explained that in reviewing the language of the statutes at issue, it concluded that they do not create a contract binding upon the State. While Section 2-508 does “entitle” retirees to a subsidy, it does not include any unmistakable contract language. Rather, it only “entitles” a retiree to the “same State subsidy allowed a State employee.” The court explained that nothing in Sections 2-508 or 2-509.1 leaves the court with an unmistakably “clear indication that the legislature intended to bind itself contractually.” Therefore, “all doubts must be resolved in favor of the continuance of the power” of the state legislature to modify or repeal enactments of a previous legislature. View "AFSCME Maryland Council 3 v. State of Maryland" on Justia Law

Reliance Standard Life Insurance Company denied Plaintiff’s claim for long-term disability benefits after concluding that she was not “Totally Disabled” as defined by her disability insurance plan. Plaintiff brought an under the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. Section 1132(a)(1)(B), arguing that the denial of benefits violated that Act. After conducting a bench trial under Federal Rule of Civil Procedure 52, the district court awarded judgment to Plaintiff. Reliance appealed, arguing that courts in the Fourth Circuit are required to resolve ERISA denial-of-benefits cases via summary judgment and that the district court erred in dispensing with this case through a bench trial. Reliance also argued that this Court must review the district court’s legal conclusions.   The Fourth Circuit affirmed. The court first held that because the plan at issue here did not require objective proof of disability, the court rejected Reliance’s contention that Plaintiff’s claim fails for the lack of such evidence. Further, the court wrote that the record supports the district court’s determination that Plaintiff’s disability was not limited to a “specific locale.” Accordingly, the court agreed that Plaintiff was “totally disabled” under the terms of the plan. View "Anita Tekmen v. Reliance Standard Life Ins." on Justia Law

The Board of Trustees of the Sheet Metal Workers’ National Pension Fund (“the Fund”) sought to recover a delinquent exit contribution from Four-C-Aire, Inc., a former participating employer, under Section 515 of the Employee Retirement Income Security Act of 1974 (“ERISA”). 29 U.S.C. Section 1145. The Fund claims Four-C-Aire’s obligation arose under a collective-bargaining agreement (“the CBA”) between the Sheet Metal Workers’ International Association Local Union No. 58 and the Central New York Sheet Metal Contractors Association, a multiemployer bargaining unit. According to the Fund, Four C-Aire signed on to this preexisting agreement while it was a member of the Contractors Association.   The Fourth Circuit affirmed, finding that Four-C-Aire adopted the agreement by its conduct. The court held that even if Four-C-Aire had preserved the issue, it’s meritless. The record contains several iterations of the written trust documents, including those imposing the exit-contribution requirement. And the Fund’s Director of Operations verified each version of the document in a declaration to the district court. Further, the court wrote there is no evidence the trust documents are invalid. In sum, Four-C-Aire offers no reason why the court shouldn’t enforce the plain terms of the agreement and trust documents, as ERISA requires. View "Board of Trustees v. Four-C-Aire, Inc." on Justia Law

Plaintiffs, each a retiree of PPG Industries, Inc. (“PPG”), or the surviving spouse of such a retiree, initiated a putative class action— following the termination of Plaintiffs’ retiree life insurance coverage under the PPG Employee Life and Other Benefits Plan (the “Benefits Plan” or the “Plan”).   The district court awarded summary judgment to the PPG defendants on all claims, without ruling on the class certification issue. On appeal, Plaintiffs contested the summary judgment award as to three counts of the Complaint, that is, Counts I, VII, and VIII.   The Fourth Circuit identified a genuine dispute of material fact with respect to the Count I claim that retiree life insurance coverage was “vested” in eligible employees working for PPG during the 15-year period from 1969 to 1984 (the “vesting claim”). The court explained that it agrees with Plaintiffs that if their retiree life insurance coverage were ever a vested benefit, PPG could not rely on the later-added reservation of rights clause to terminate that coverage.Accordingly, the court vacated vacate the judgment as to the vesting claim and remanded for consideration of whether the termination of Plaintiffs’ retiree life insurance coverage contravened the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. Section 1001 et seq. View "Charles Bellon v. The PPG Employee Life and Other Benefits Plan" on Justia Law

Plaintiff suffered from back and neck pain for years, and her doctor concluded that surgery would help her relieve her symptoms. After surgery, her insurance provider, Central States, denied her claim. Central States made this determination pursuant to a provision of the plan stating that covered individuals “shall not be entitled to payment of any charges for care, treatment, services, or supplies which are not medically necessary or are not generally accepted by the medical community as Standard Medical Care, Treatment, Services or Supplies.” Central States came to this conclusion based on an independent medical review (IMR) of Plaintiff’s claim, conducted by a physician board-certified in general surgery. Plaintiff filed suit under the Employee Retirement Income Security Act (“ERISA”), and Defendant appealed the district court’s ruling.The Fourth Circuit found that Central States failed to disclose to their IMR physician the medical records that would have been pertinent to his analysis. The court noted that it did not conclude that Central States acted in bad faith or deliberately withheld documentation. But intent aside, Central States owes plan participants a “deliberate, principled reasoning process.” Further, while plan trustees enjoy a good measure of discretion in determining what is “medically necessary” under the terms of the plan, they may not abuse that discretion by employing processes that lead to unreasoned conclusions or by affixing extratextual requirements. The court held that because Central States had ample chance to review Plaintiff’s claim, the district court did not abuse its discretion by awarding benefits outright. View "Dorothy Garner v. Central States, Southeast and Southwest Areas" on Justia Law