In Swenson v. United of Omaha Life Insurance Company, No. 17-30374 (5th Cir. 2017), Katheryn Swenson filed suit in Louisiana state court seeking benefits from a life insurance policy after her husband passed away.  The insurance company refused to pay based on its belief that Swenson’s husband was not a covered employee at the time of his death.  In seeking to recover the death benefits, Swenson cited Louisiana statutes imposing certain requirements on group life policies concerning the rights of a discharged employee to convert the employer-provided policy into individual life insurance.  Although Swenson alleged only state law claims, the insurer removed the matter to federal court arguing it was completely preempted by ERISA.   After the case was removed, Swenson added a claim for equitable relief under ERISA.

The district court dismissed Swenson’s claims on various grounds.  It held that ERISA preempted the state law claims, so it dismissed them with prejudice. Because of this finding of complete preemption, the district court construed the complaint as seeking recovery of benefits from an ERISA plan.  But that claim was dismissed without prejudice for failure to exhaust administrative remedies (Swenson has since commenced the ERISA administrative process).  As to the claim for equitable relief under ERISA, the court dismissed it with prejudice on the ground that equitable relief is not available when ERISA provides an adequate legal remedy, such as the provision allowing judicial review of benefit denials (29 U.S.C. § 1132(a)(1)).

On appeal, Swenson challenges only the preemption ruling and denial of her claim for equitable relief.

In Ibson v. United Healthcare Services, Inc., No. 16-3260 (8th Cir. 2017), an ongoing dispute between CeCelia Ibson and United HealthCare Services, Inc. (“UHS”) has returned to this court (the Eighth Circuit Court of Appeals or the “Court”).  After the Court decided that ERISA preempted her state-law claims, Ibson filed claims under ERISA against UHS.  The district court dismissed her complaint.  The question before the Court, now, is whether Ibson has pled a viable claim against UHS under ERISA.

Ibson was at one time a shareholder in an Iowa law firm that contracted with UHS to provide health insurance for its employees.  Ibson enrolled herself and her family, including her late husband, Jay Wagner, in her employer-sponsored UHS healthcare plan in March 2004.  In early 2008, UHS began denying claims, and until 2010, pursued recoupment actions for claims already paid.  UHS eventually paid $36,417.29 for outstanding claims.  This suit ensued, however, with Ibson alleging that UHS still owes $190,579.91 for the care Jay Wagner received.  She is seeking recovery of that amount of “unpaid benefits” under Section 502(a)(1)(B) of ERISA.

After reviewing the case, the Court said that Ibson does not have a claim to alleged unpaid benefits due under Section 502(a)(1)(B); rather, that claim must be brought by the estate of the beneficiary, Jay Wagner.  The Court also found that Ibson cannot bring this claim, in her personal capacity, for the unpaid benefits in equity under Section 502(a)(3)(B) of ERISA.  But, a restitutionary claim for premiums Ibson paid under Section 502(a)(3)(B) is potentially available to her if there was a plan violation.  Accordingly, the Court remanded the case to the district court to determine initially if there was such a plan violation and, if so, whether restitution of Ibson’s premiums is “appropriate equitable relief” under Section 502(a)(3)(B).

In a press release dated 1/5/18, the U.S. Department of Labor finalized the delay in the effective date of the new ERISA regulations on disability benefit claims to April 1, 2018.  Here is what the press release says:

The U.S. Department of Labor announced today its decision for April 1, 2018, as the applicability date for employee benefit plans to comply with a final rule under ERISA that will give America’s workers new procedural protections when dealing with plan fiduciaries and insurance providers who deny their claims for disability benefits.

The new rule ensures, for example, that disability claimants receive a clear explanation of why their claim was denied as well as their rights to appeal a denial of a benefit claim, and to review and respond to new information developed by the plan during the course of an appeal. The rule also requires that a claims adjudicator could not be hired, promoted, terminated, or compensated based on the likelihood of denying claims.

In Van Steen  v. Life Insurance Company N.A., No. 16-1405 (10th Cir. 2018), the appeal arose out of the termination by Life Insurance Company of North America (“LINA”) of Carl Van Steen’s long-term disability benefits under Lockheed Martin’s benefit plan, which is subject to ERISA.  LINA appeals the district court’s finding that its decision to terminate Mr. Van Steen’s benefits was arbitrary and capricious, so that the district court overturned LINA’s decision.  Upon reviewing the case, the Tenth Circuit Court of Appeals (the “Court”) affirmed the district court’s ruling.

In this case, Van Steen was employed as a Systems Integration Business Analyst at Lockheed Martin Corporation.  As such, he was a participant in the Lockheed Martin Group Benefits Plan (the “Plan”), which is administered and insured by LINA.  In October 2011, Van Steen was physically assaulted during an altercation while walking his dog.  The assault resulted in a mild traumatic brain injury (“mTBI”) that impacted Mr. Van Steen’s cognitive abilities.  This cognitive dysfunction ultimately prevented him from functioning in his job.

Van Steen applied for and an initially began to receive long-term disability benefits from the Plan.  However, LINA later decided to terminate the benefits, on the grounds that the medical documentation does not show that Van Steen’s condition  precludes him from resuming his work.  Van Steen then filed suit, challenging the termination of his benefits. The case wound up before the Court.

In Allied Construction Industries v. City of Cincinnati, Nos. 16-4248/4249  (6th Cir. 2018), the City of Cincinnati  (the “City”) and Laborers International Union of North America, Local 265 (“the Union”) appeal the district court’s grant of summary judgment to Allied Construction Industries (“Allied Construction”), and the denial of the City’s and the Union’s motions for summary judgment. The district court held that three City ordinance provisions (“the Ordinance”) concerning bidder specifications for certain City projects were preempted by ERISA.

In this case, the Ordinance provides guidelines for selecting the lowest and best bidder on City Department of Sewers and Water Works projects. The portion of the Ordinance potentially subject to preemption was a requirement that the bidder certify whether it contributes to a health care plan, pension plan or retirement plan for employees that would work on the project.

In analyzing the case, the Sixth Circuit Court of Appeals (the “Court”) held that the City was acting as a market participant attempting to purchase goods and services, not as a regulator, in enacting the Ordinance.  As such, the provisions of the Ordinance are not preempted by ERISA. Accordingly, the Court reversed the holding of the district court.


In Stevens Engineers & Constructors, Inc. v. Local 17 Iron Workers Pension Fund, Nos. 16-4098, 16-4099 (6th Cir. 2017), the Sixth Circuit Court of Appeals (the “Court”) noted that, under the Multiemployer Pension Plan Amendments Act, a part of ERISA, a construction industry employer who withdraws from a multiemployer pension plan owes withdrawal liability to that plan if the employer conducts work “in the jurisdiction of the collective bargaining agreement of the type for which contributions were previously required.” 29 U.S.C. § 1383(b)(2)(B)(i).  In accordance with this provision, the Trustees of the Iron Workers Local 17 Pension Fund assessed withdrawal liability against Stevens Engineers & Constructors, a withdrawing employer, claiming that Stevens’s activities on a certain construction project involved such work within the jurisdiction of their previous collective bargaining agreement.

The Court continued by noting, however, that an arbitrator and the district court below found that Stevens did not owe withdrawal liability to the Local 17 Pension Fund, because the work identified by Local 17 did not fall within the jurisdiction of the relevant collective bargaining agreement, and did not otherwise require contributions by Stevens.  The collective bargaining agreement instead allowed Stevens to assign jobs like the ones at issue to other trade unions, and a job did not trigger withdrawal liability to the Local 17 Pension Fund if, as here, it was properly assigned to a different union.  Local 17 offers additional arguments as to why Stevens owed withdrawal liability, but these are also unavailing.

Accordingly, the Court ruled that Stevens had not incurred any withdrawal liability to the Local 17 Pension Fund.

In Connecticut General Life Insurance Company v. Humble Surgical Hospital, L.L.C., No. 16-20398 (5th Cir. 2017), the Fifth Circuit Court of Appeals (the “Court”) was asked to decide whether the district court erred when it granted judgment for Humble Surgical Hospital (“Humble”) on its claims for damages against the Connecticut General Life Insurance Company and its parent-corporation, Cigna Health and Life Insurance Company, (collectively, “Cigna”) under ERISA §§ 502(a)(1)(B) and 502(a)(3).

In analyzing the case, the Court said that the district court failed to apply the required abuse of discretion analysis; other courts have upheld Cigna’s interpretation of its insurance plans; and there was substantial evidence supporting Cigna’s interpretation. Accordingly, the Court reversed the district court judgement against Cigna. Moreover, as Cigna is not a named plan administrator, the Court reversed the district court’s award of ERISA penalties against Cigna. It vacated in part the district court’s dismissal of Cigna’s claims against Humble. It further vacated the district court’s award of attorneys’ fees and remanded the case for further consideration.

In Medina v. Catholic Health Initiatives, No. 16-1005 (10th Cir. 2018), the Tenth Circuit Court of Appeals (the “Court”) noted that ERISA generally exempts from its requirements “church plans”—employee-benefit plans established and maintained by churches for their employees. ERISA also extends that church-plan exemption to so-called principal-purpose organizations. A principal-purpose organization is a church-affiliated organization whose principal purpose is administering or funding a benefit plan for the employees of a church or a church-affiliated nonprofit organization.

In this case, Catholic Health Initiatives (“CHI”) is a Denver-based nonprofit organization created to carry out the Roman Catholic Church’s healing ministry. To do so, CHI operates 92 hospitals and numerous other healthcare facilities in 18 states. CHI offers a retirement plan for its employees, with more than 90,000 participants and beneficiaries, and nearly $3 billion in plan assets. The CHI plan is administered by the CHI and Affiliates Defined Benefit Plan Subcommittee (the “Subcommittee”), whose members are appointed and removed by CHI’s Board of Stewardship Trustees.

The district court held that CHI’s plan was a church plan that qualified for the ERISA exemption. On appeal, the Court agreed, concluding that CHI’s plan satisfies the statutory requirements for the church-plan exemption: CHI is a tax-exempt organization associated with a church, and the Subcommittee is a proper principal-purpose organization that is also associated with a church. The ERISA exemption, moreover, does not run afoul of the United States Constitution’s Establishment Clause.

In Sun Life Assurance Company of Canada v. Jackson, No. 17-3120 (6th Cir. 2017), Bruce Jackson married Bridget Jackson in 1993.  Sierra Jackson, their only child, arrived in 1995.  They divorced in 2006.  Under their divorce decree, Bruce and Bridget were required to maintain any employer-related life insurance policies for the benefit of Sierra until she turned 18 or graduated from high school.  At the time, Bruce had an employer-sponsored life insurance policy, under a plan subject to ERISA, that listed his uncle, Richard Jackson, as the sole beneficiary.  Bruce never changed the beneficiary of the policy to Sierra before he died in 2013.  Litigation ensued, and the district court ordered Sun Life to pay the life insurance proceeds to Sierra.

Upon reviewing the case, the Sixth Circuit Court of Appeals (the “Court”) stated that the divorce decree suffices as a qualified domestic relations order that “clearly specifies” Sierra as the beneficiary under ERISA, 29 U.S.C. § 1056(d)(3)(C), so that Sierra is entitled to the benefit from the plan specified in the divorce decree.  Accordingly, the Court affirmed the district court’s holding.

In Babin v. Quality Energy Services, Incorporated, No. 17-30059 (5th Cir. 2017), Todd M. Babin worked for Quality Energy Services, Inc., until he became disabled in 2012.  He applied for short-term disability benefits through Quality Energy’s employee benefit plan.  His application was denied in February 2013.  In February 2014, he requested documents regarding both the short- and long-term disability plans, but he alleges that Quality Energy never sent those documents to him.  Babin ultimately filed suit against Quality Energy and its disability insurer in October 2015, alleging claims under ERISA for failure to pay benefits and failure to produce plan documents.

The parties settled the failure-to-pay-benefits claim, and Quality Energy moved for summary judgment on the failure-to-produce-documents claim.  The district court concluded that Babin’s claim was time-barred and granted summary judgment.  On appeal, Babin argues that Louisiana’s ten-year prescriptive period for personal actions should govern his claim for failure to produce documents under 29 U.S.C. § 1132(c).  Upon reviewing the case, the Fifth Circuit Court of Appeals (the “Court”) concluded, however, that Louisiana’s one-year period for delictual actions (that is, generally, breach of duty actions) applies and that Babin’s claim is time-barred. As a result, the Court affirmed the district court’s ruling.