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

David Day, an ERISA plan beneficiary, elected to roll over his pension benefits into an individual retirement account (IRA) upon separation from his employer, AT&T. Exercising its discretion, the plan's claims administrator construed Day's lump sum rollover as the equivalent of his having "received" his pension benefits and, according to the terms of AT&T's Disability Income Benefit Plan, reduced Day's long-term disability (LTD) benefits by the amount of the rollover. The district court entered judgment in favor of the plan. The Ninth Circuit Court of Appeals affirmed, holding (1) the administrator reasonably interpreted the plan; (2) AT&T did not breach its fiduciary duties by failing to disclose the possibility that Petitioner's LTD benefits would be reduced by his receipt of pension benefits; and (3) the administrator's actions did not violate the Age Discrimination in Employment Act. View "Day v. AT&T Disability Income Plan" on Justia Law

Plaintiff appealed the district court's dismissal of her claim challenging the termination of her long-term disability benefits under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1132. Plaintiff challenged the district court's grant of summary judgment in favor of Unum on it's counterclaim for restitution of overpaid benefits. The court held that the district court abused its discretion by dismissing the claim for denial of benefits for failure to exhaust administrative remedies. The exhaustion requirement should have been excused because plaintiff acted reasonably in light of Unum's ambiguous communications and failure to engage in a meaningful dialogue. Accordingly, the court vacated the judgment in favor of Unum on plaintiff's claim for denial of benefits. View "Bilyeu v. Morgan Stanley Long Term Disability Plan, et al." on Justia Law

Defendant appealed the district court's grant of partial summary judgment in favor of CGI in its action seeking "appropriate equitable relief" under section 502(a)(3) of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. CGI appealed the district court's grant of partial summary judgment in favor of defendant's counsel and codefendant, dismissing the codefendant from the action. CGI also appealed the district court's grant of proportional fees and costs to the codefendant, deducted from CGI's recovery from defendant. The court affirmed the district court's grant of summary judgment in favor of the codefendant, dismissing it from the action. However, because the court saw no indication that in fashioning "appropriate equitable relief" for CGI, the district court did more than interpret the plain terms of the reimbursement provision, and no indication that the district court considered traditional equitable principles in assigning responsibility to CGI for attorneys' fees and costs, the court vacated the judgment in favor of CGI, vacated the judgment that the codefendant deducted fees and costs from CGI's entitlement, and remanded to the district court for further proceedings. View "CGI Technologies and Solutions v. Rose, et al." on Justia Law

Plaintiffs, employees at a defense plant in Arizona, collectively bargained for the right to receive employer-provided healthcare coverage after they retired. At issue was whether those employees, now retirees, were contractually entitled to receive premium-free healthcare coverage until age 65, or whether the contracts on which the retirees relied as providing that entitlement allowed their prior employer to start charging them for their insurance. The court held that Raytheon expressly agreed to provide 100% company-paid healthcare coverage for eligible retirees; that Raytheon's obligation survived the expectation of the collective bargaining agreements (CBAs); and that Raytheon's agreed-upon obligation could not be unilaterally abrogated by Raytheon, regardless of the rights Raytheon reserved for itself in Plan documents, because the CBAs did not incorporate the Plans' reservation-of-rights provisions with respect to employer contribution issues, as opposed to issues relating to the provision of monetary or in kind benefits for particular medical services. The court further held that the district court did not err in rejecting plaintiffs' claim for punitive and extra-contractual damages.

Plaintiffs appealed summary judgment rejecting their claims under the Employee Retirement Income Security Act of 1974, (ERISA), 29 U.S.C. 1001 et seq. Plaintiffs were employees of Litton and participated in its retirement plan (Litton Plan B). Following corporate mergers and plan modifications, plaintiffs sued the successor corporation and Northrop Plan B, the plan that replaced Litton Plan B under section 502(a)(1)(B) to enforce their understanding of their rights under Northrop Plan B. The court held that summary judgment was appropriate on plaintiffs' claims under section 502(a)(1)(B) and 502(a)(3), rejecting their claims based on reformation and surcharge.

Plaintiff, a former employee of defendant, filed this action under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1101 et seq., to challenge the termination of his long-term disability benefits. At issue on appeal was whether the district court erroneously relied on Curtis v. Nevada Bonding Corp. to dismiss the case for lack of subject matter jurisdiction. The court agreed with plaintiff that Vaughn v. Bay Environmental Management, Inc. controlled in these circumstances. Whether plaintiff was a participant for purposes of ERISA was a substantive element of his claim, not a prerequisite for subject matter jurisdiction. Therefore, the court vacated the dismissal and remanded for further proceedings because plaintiff asserted a colorable claim that he was a plan participant and satisfied the threshold for establishing subject matter jurisdiction.

This appeal presented the question of whether a provision of the federal Health Insurance Portability and Accountability Act (HIPAA), Pub. L. No. 104-191, 110 Stat. 1936, preempted Montana's "little HIPAA" law, Mont. Code Ann. 33-22-526(2)(a), for purposes of both conferring federal subject matter jurisdiction and defeating state-law causes of action on the merits. The federal and state HIPAA provisions at issue prohibited certain insurers from charging different premiums to similarly situated participants on account of a participant's health and status-related factor. The court affirmed the district court and held that federal HIPAA preempted the Montana law, both jurisdictionally and on the merits, because Montana's HIPAA provision was identical to, and expressly relied upon, federal law. The court held, however, that federal law did not preempt a claim for relief under a separate Montana unfair insurance practices statute that barred insurers from engaging in unfair discrimination when charging policy premiums to similarly situated individuals, Mont. Code Ann. 33-18-206(2).

Plaintiff appealed the district court's dismissal of her ERISA, 29 U.S.C. 1001 et seq., action against defendant as not timely filed. Plaintiff was employed by defendant as a stockbroker in 1979 and starting in 1982, plaintiff had been disabled periodically from her employment. Plaintiff applied for long-term disability benefits around January 15, 1987. The court held that plaintiff's claim did not accrue in 1990 with regard to the ERISA statute of limitations, as the district court found, but rather accrued when her claim was finally denied on January 14, 2004. Therefore, plaintiff's action, filed on February 16, 2006, commenced within the four-year statutory limitations period for ERISA claims. The court also held that the limitations provision in the policy here did not apply to disability cases in which the claimant contested the amount of benefits or claims that the benefits have been miscalculated. Accordingly, the court vacated the judgment of the district court and remanded for further proceedings.

Plaintiff filed an action against defendants (collectively, the Plan) for refusing to pay certain long-term disability benefits. At issue was whether the district court erred in granting summary judgment for defendants and dismissed plaintiff's claims without prejudice due to his failure to exhaust available administrative remedies under the Plan. The court held that the district court adopted the Plan's reading of ERISA, 29 C.F.R. 250.503-1(i) without the benefit of the Secretary of Labor's interpretation of that provision. Therefore, deferring to the Secretary's plausible approach, the court held that where a claimant sought review of his or her disability claims, the quarterly meeting rule was restricted to multiemployer plans. Accordingly, the Plan was required to render a decision within 90 days of plaintiff's administrative appeal and failed to do so. Consequently, plaintiff's claims must be deemed exhausted and the judgment was reversed and remanded.

The court agreed to hear this case en banc in order to reconsider its precedent as to which parties could be sued as defendants in actions for benefits under 29 U.S.C. 1132(a)(1)(B), part of ERISA. Some of the court's previous decisions had indicated that only a benefit plan itself or the plan administrator of a benefit plan covered under ERISA was a proper defendant in a lawsuit under that provision. The court concluded that the statute did not support that limitation, however, and that an entity other than the plan itself or the plan administrator could be sued under that statute in appropriate circumstances. Therefore, the court held that Reliance Standard Ins. Co. was a proper defendant in a lawsuit brought by plaintiff under ERISA and overruled its prior decisions to the contrary. To apply that decision and to resolve other issues raised in the appeal, the court transferred this case back to the three-judge panel to which the case was previously assigned.