Justia U.S. 9th Circuit Court of Appeals Opinion Summaries

Articles Posted in ERISA

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Plan beneficiaries (Plaintiffs) filed claims against their employer and its benefits plan administrator (collectively, Defendants) alleging breach of fiduciary duty in the selection and retention of certain mutual funds for a benefit plan governed by ERISA. The district court concluded that Plaintiffs' claims regarding the selection of mutual funds in 1999 were time-barred under the six-year limit of 29 U.S.C. 1113(1). The court of appeals affirmed. The Supreme Court vacated the decision of the court of appeals, holding that federal law imposes on fiduciaries an ongoing duty to monitor investments even absent a change in circumstances. On remand, the Fourth Circuit vacated the district court’s decisions regarding funds added to the ERISA plan before 2001, holding (1) Plaintiffs did not forfeit the ongoing-duty-to-monitor argument either in the district court or on appeal; (2) only a “breach of violation” need occur within the six-year statutory period, and the initial investment need not be made within the statutory period; and (3) the duty of prudence required Defendants to reevaluate investments periodically and to take into account their power to obtain favorable investment products. Remanded. View "Tibble v. Edison International" on Justia Law
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Plaintiff filed suit under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., seeking judicial review of the denial of benefits under his long term disability policy sponsored by his employer and issued by Northwestern Mutual. The court held that the district court erred in denying plaintiff his long term disability benefits under the Plan where the administrative record plainly showed that plaintiff could not sit for more than four hours a day. Nonetheless, the district court upheld Northwestern Mutual’s determination that Armani could perform work at the “sedentary” level. The court agreed with other circuits and held that an employee who cannot sit for more than four hours in an eight-hour workday cannot perform “sedentary” work that requires “sitting most of the time.” Accordingly, the court vacated and remanded. View "Armani v. Northwestern Mutual Life Insurance Co." on Justia Law
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Plaintiff filed suit against his former employer, RSA, alleging retaliatory discharge claims under both state law and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. A jury awarded him lump-sum damages on his state law claims, and the district court then entered judgment in his favor on his ERISA claim. Even though, at plaintiff's request, the jury had been instructed to include front pay in its damages award, the district court granted plaintiff additional equitable remedies consisting of reinstatement as well as front pay until reinstatement occurred. RSA appeals these equitable remedies. Given the way in which the jury was instructed and the evidence presented at trial, the court concluded that the jury’s verdict encompassed an implicit factual determination as to the entire amount of front pay to which plaintiff was entitled on account of his retaliatory discharge. Therefore, the court held that the district court’s grant of an additional front pay remedy for the same harm disregarded that determination in violation of the Seventh Amendment right to a jury trial. The court also held that, although the reinstatement remedy does not necessarily conflict with factual findings implicit in the jury’s verdict, it is nevertheless improper because plaintiff waived that relief when he elected to seek the duplicative front pay remedy from the jury. Accordingly, the court reversed the equitable awards. View "Teutscher v. Woodson" on Justia Law

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Plaintiff filed suit under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., against the Plan and MetLife, claiming that MetLife, the claim administrator and insurer of the Plan, improperly denied his claim for long-term disability (LTD) benefits. The district court granted defendants' cross-motion for summary judgment. The court concluded that the abuse-of-discretion review should be tempered with some skepticism because plaintiff has offered evidence of a conflict of interest where the independent physician consultants (IPCs) have earned a substantial amount of money from MetLife and have performed a substantial number of reviews for the company as well. The court further concluded that, taking into account the totality of the circumstances, MetLife abused its discretion in denying plaintiff's claim. In this case, the evidence included the financial conflict of interest of the IPCs on whom MetLife relied; the substantial evidence of plaintiff's mental limitations due to pain medication and physical limitations; and the IPCs’ reviews of plaintiff's condition, without having examined him and without explaining why they rejected his credibility, particularly in regard to evidence corroborating his credibility (both medical and nonmedical). Accordingly, the court reversed and remanded with instructions to the district court to remand this case to MetLife so that it may re-evaluate the merits of plaintiff's LTD claim. View "Demer v. IBM Corp." on Justia Law
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Plaintiff filed a putative class action against her former employer, Dignity Health, alleging that the company has not maintained its pension plan in compliance with the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. Although Dignity Health concedes it has not complied with ERISA, it contends that the plan qualifies for ERISA’s church-plan exemption. The district court awarded partial summary judgment to plaintiff, ruling that Dignity Health’s pension plan must comply with ERISA. The court agreed with its sister circuits and held that a church plan must be established by a church or by a convention or association of churches, and maintained either by a church or by a principal-purpose organization. Accordingly, the court affirmed the judgment and remanded for further proceedings. View "Rollins v. Dignity Health" on Justia Law
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After plaintiff's long term disability benefits were terminated, plaintiff filed suit under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1132(c)(1), against his former employer, ING, seeking statutory penalties against ING for failing to timely produce documents he had requested. The district court granted summary judgment to plaintiff and imposed a penalty of $27,475. The court affirmed the district court's decision to impose a penalty on ING North America for its failure to timely produce the Plan Document; the court reversed the district court’s decision to impose a penalty based on ING North America’s failure to timely produce the emails at issue; the court joined its sister circuits and held that penalties under 29 U.S.C. 1132(c)(1) can only be assessed against “plan administrators” for failing to produce documents that they are required to produce as plan administrators; and 29 C.F.R. 2560.503-1(h)(2)(iii) does not impose any requirements on plan administrators, and so cannot form the basis for a penalty under 29 U.S.C. 1132(c)(1). Accordingly, the court vacated the penalty award and remanded to the district court to assess a penalty based solely on the failure to timely produce the Plan Document. View "Lee v. ING Groep" on Justia Law
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Plaintiff filed claims alleging breach of contract and claims under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., against BAH and others. Under California law, a breach of a written contract must be brought within four years of the date of the alleged breach, Cal. Civ. Proc. Code 337. The court concluded that plaintiff's cause of action accrued in September 2003 and the filing of his complaint was untimely. Therefore, plaintiff's breach of contract claim is time barred. The court also concluded that the district court did not abuse its discretion by denying plaintiff a third opportunity to amend his complaint. Finally, the court held that the employer’s stock rights plan did not qualify as an employee pension benefit plan subject to ERISA under 29 U.S.C. 1002(2)(A) because its primary purpose was not to provide deferred compensation or other retirement benefits. Because, in this case, the stock rights plan was not designed or intended to provide retirement or deferred income, it is not covered by ERISA. Accordingly, the court affirmed the judgment. View "Rich v. Shrader" on Justia Law
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Plaintiffs, former employees of Golden Eagle, filed a class action against Liberty Mutual for violating the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. Plaintiffs alleged that when Liberty Mutual purchased Golden Eagle, Liberty Mutual told plaintiffs that they would receive past service credit for the time they worked with Golden Eagle under Liberty Mutual’s retirement plan. The district court granted summary judgment to Liberty Mutual. The court concluded that plaintiffs cannot receive benefits for past service credit with Golden Eagle under the terms of the retirement plan where the district court applied the correct abuse of discretion standard, and Liberty Mutual's interpretation of the plan was reasonable. The court also concluded that plaintiffs are not barred from bringing simultaneous claims under section 1132(a)(3) and 1132(a)(1)(B). In Varity Corp. v. Howe, equitable relief under section 1132(a)(3) is not available if section 1132(a)(1)(B) provides an adequate remedy. In CIGNA Corp. v. Amara, section 1132(a)(3) authorized equitable relief in the form of plan reformation, even though plaintiffs also claimed relief under section 1132(a)(1)(B). Applying Amara’s conclusion that a plaintiff may seek relief under both section 1132(a)(1)(B) and section 1132(a)(3) does not contravene the ruling in Varity. The court further concluded that Liberty Mutual failed to notify plaintiffs in its summary plan descriptions that past service credit with Golden Eagle would not count for benefits accrual, but plaintiffs did not prove harm or reliance on the summary plan descriptions. Finally, the class certification was appropriate. Accordingly, the court affirmed in part, reversed in part, and remanded. View "Moyle v. Liberty Mut. Ret. Benefit Plan" on Justia Law
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Bruce Barton filed suit against ADT under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1132, seeking claims related to his request for pension benefits. On appeal, Barton challenges the district court's conclusion that the Plan Administrator did not abuse its discretion in denying Barton’s request for pension benefits. The court concluded that the district court incorrectly placed the burden of proof on Barton for matters within defendants’ control. The court held that where a claimant has made a prima facie case that he is entitled to a pension benefit but lacks access to the key information about corporate structure or hours worked needed to substantiate his claim and the defendant controls such information, the burden shifts to the defendant to produce this information. The district court correctly held that to recover statutory penalties based on a plan administrator’s refusal to comply with ERISA’s disclosure obligations, a plaintiff must qualify as a plan participant. The court reversed and remanded for the district court to apply the now-clarified burden of proof in this case. View "Estate of Barton v. ADT" on Justia Law
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After a bench trial, the district court held that Michael's was not liable as a successor employer by weighing continuity of the workforce as the most important factor. At issue was: (1) whether a successor employer, both generally and in the construction industry in particular, can be subject to withdrawal liability under the Multiemployer Pension Plan Amendments Act (MPPAA), 29 U.S.C. 1381–1453, amendments to the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq.; and (2) if so, what factors are most relevant to determining whether a construction industry employer is a successor for purposes of imposing MPPAA withdrawal liability. The court concluded that a construction industry successor employer can be subject to MPPAA withdrawal liability, so long as the successor took over the business with notice of the liability; that the most important factor in assessing whether an employer is a successor for purposes of imposing MPPAA withdrawal liability is whether there is substantial continuity in the business operations between the predecessor and the successor, as determined in large part by whether the new employer has taken over the economically critical bulk of the prior employer’s customer base; and, in this case, the district court erred in weighing continuity of the workforce as the most important factor and applying an incorrect test to determine whether there was continuity of the workforce. Accordingly, the court reversed and remanded for further proceedings. View "Resilient Floor Covering Pension Trust Fund Bd. of Trs. v. Michael's Floor Covering" on Justia Law