Justia U.S. 5th Circuit Court of Appeals Opinion Summaries

Articles Posted in ERISA

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In this Employee Retirement Income Security Act (ERISA) contract dispute, the district court determined that the provider had standing to bring this lawsuit because an anti-assignment provision in the plan was ambiguous or, in the alternative, because the anti-assignment provision was rendered unenforceable by a Tennessee statute. The Fifth Circuit held that the plan's anti-assignment clause unambiguously prohibits the beneficiary from assigning his or her right to sue under the plan to a third-party provider. The court also held that the Tennessee statute, Tenn. Code Ann. 56-7-120(a) (2012), was preempted by ERISA. Accordingly, the court reversed the district court's judgment on the issue of whether plaintiff had standing to bring this lawsuit; vacated the district court's subsequent judgments; and rendered judgment that the case shall be dismissed based on lack of jurisdiction. View "Dialysis Newco, Inc. v. Community Health Systems Group Health Plan" on Justia Law

Posted in: ERISA

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The Fifth Circuit affirmed the district court's grant of summary judgment to Sun Life in an action brought by plaintiff, a beneficiary of a long-term disability plan governed by the Employee Retirement Income Security Act of 1974 (ERISA) and administered by Sun Life, alleging that Sun Life had miscalculated his benefits since 2008. The district court agreed with Sun Life that the contractual limitations period for plaintiff's claim had long since passed. The court affirmed the district court's conclusion that no genuine issues of material fact exist as to plaintiff's receipt of the March 2008 letter and that the letter contained enough information for plaintiff's miscalculation claim to accrue. Furthermore, Withrow v. Halsey, 655 F.3d 1032 (9th Cir. 2011), in which the Ninth Circuit ruled that an ERISA miscalculation claim was timely despite a gap of many years between the plan and beneficiary's initial correspondence and the beneficiary's suit, did not help plaintiff and the district court did not abuse its discretion by denying the motion. View "Faciane v. Sun Life Assurance Co." on Justia Law

Posted in: ERISA

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The Fifth Circuit reversed the district court's judgment granting plaintiff past and future long term disability (LTD) benefits and rendered judgment for Reliance. After plaintiff stopped work for a chicken processing plant, she sought LTD benefits under a policy governed by the Employee Retirement Income Security Act (ERISA). The court held that Reliance's contention that its decision that working in cold areas was not a material duty of plaintiff's regular occupation was supported by substantial evidence. The court held that precedent did not require that an administrator consider each of a claimant's job duties to determine her regular occupation. In any event, Reliance's classification was easily based on substantial evidence. View "Nichols v. Reliance Standard Life Insurance Co." on Justia Law

Posted in: ERISA

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This case arose from a dispute between decedent Gerald Miletello's ex-wife Sandra and widow Pam about who was entitled to the funds in Gerald's 401(k) retirement account. The Fifth Circuit affirmed the district court's judgment that Sandra was entitled to $500,000 of the 401(k) balance because she had timely received a qualified domestic relations order (QDRO). The court explained that Congress has modified the Employee Retirement Income Security Act (ERISA) to make clear that a QDRO will not fail solely because of the time at which it was issued. Rather, the QDRO provisions merely prevent her from enforcing her interest until the QDRO is obtained. View "Miletello v. R M R Mechanical, Inc." on Justia Law

Posted in: ERISA

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The Fifth Circuit affirmed the district court's judgment in favor of Principal in an action brought by plaintiff, alleging that Principal abused its discretion by denying her benefits. The court held that Principal's benefits denial was supported by substantial evidence. The court held that, at bottom, there was no abuse of discretion in Principal's reliance on its own treating physicians' reports detailing an absence of plaintiff's impairments. The court also held that, although Principal had a structural conflict of interest that it both evaluates and pays claims, this factor had little weight in light of the extensive investigation that Principal conducted. View "Foster v. Principal Life Insurance Co." on Justia Law

Posted in: ERISA, Insurance Law

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Encompass filed suit against Blue Cross for violations of the Employee Retirement Income Security Act (ERISA), breach of contract, defamation, and tortious interference with business relations. After Blue Cross largely prevailed at trial, the district court granted a new trial because of error in the jury charge. At the second trial, Encompass prevailed on all claims. The Fifth Circuit held that charging the jury with an incorrect standard of liability supported granting a new trial, and thus the district court did not abuse its discretion by granting Encompass a new trial on the breach of contract claims. The court also held that the district court did not abuse its discretion by granting a new trial on the tort claims considering the interdependence of the tort and contract issues. Finally, the court held that the application of contra non valentem was not wrong as a matter of law, and Blue Cross abused its discretion by arbitrarily denying Encompass's claims for covered services under ERISA. View "Encompass Off Solutions, Inc. v. Louisiana Health Service & Indemnity Co." on Justia Law

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Plaintiff filed suit against Anthem, the administrator of an Employee Retirement Income Security Act (ERISA) covered plan, after Anthem denied preauthorization for both bariatric surgery (weight loss surgery) and the follow-up surgery. The Fifth Circuit held that Anthem did not abuse its discretion in either the first- or second-level appeal of the denial of benefits. The court explained that Anthem satisfied the very low, very deferential abuse-of-discretion standard. Therefore, the court affirmed the district court's assessment of the first-level appeal, reversed the district court's assessment of the second-level appeal, and dismissed plaintiff's cross appeal as moot. View "Rittinger v. Healthy Alliance Life Insurance Co." on Justia Law

Posted in: ERISA

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Plaintiff filed suit against Prudential and Turner for violations of the Employee Retirement Income Security Act of 1974 (ERISA) and state law. Prudential counterclaimed, seeking repayment of short term disability (STD) benefits it allegedly paid in error. The district court rejected plaintiff's claims and granted summary judgment for Prudential on its repayment counterclaim. The Fifth Circuit reversed and remanded the district court's dismissal of plaintiff's claims for fiduciary breach and failure to provide documents as to Turner and his claim for plan benefits and discrimination as to Prudential; reversed and remanded the grant of summary judgment to Prudential on its claim for reimbursement; affirmed the dismissal of plaintiff's fiduciary breach and failure to provide document claims against Prudential; affirmed the application of the abuse of discretion standard to plaintiff's claims for plan benefits; instructed the district court to consider anew any discovery requests related to plaintiff's surviving claims; and vacated the award of prejudgment interest to Prudential. View "Manuel v. Turner Industries Group, LLC" on Justia Law

Posted in: ERISA

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Plaintiff filed suit alleging that DBG had discontinued its Employee Retirement Income Security Act (ERISA) health plan without notifying him, in violation of the Consolidated Omnibus Budget Recovery Act's (COBRA) notice requirements. The Fifth Circuit reversed the district court's dismissal of the COBRA claim and held that plaintiff adequately alleged that DBG did not fulfill its notice obligations under COBRA, and that DBG's letter was insufficient to support dismissal of his notice claim. The court held that the district court abused its discretion when it ruled that plaintiff was legally barred from obtaining a penalty award, and remanded the case to the district court to determine whether, in light of the foregoing analysis, to award a civil penalty, and if it did, the amount of such penalty. The court also remanded to the district court for it to determine whether attorneys fees were applicable in this case. View "Hager v. DBG Partners, Inc." on Justia Law

Posted in: ERISA

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Plaintiff filed suit against Whole Foods executives, alleging that they breached their fiduciary duties by allowing employees to continue to invest in Whole Foods stock while its value was artificially inflated due to a widespread overpricing scheme. The Fifth Circuit affirmed the district court's dismissal of the claims, holding that plaintiff failed to plausibly allege an alternative action that defendants could have taken that would have been consistent with the securities laws and that a prudent fiduciary in the same circumstances would not have viewed as more likely to harm the fund than to help it. View "Martone v. Robb" on Justia Law

Posted in: ERISA