Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

An insurance policyholder, TD Banknorth Insurance Agency, Inc., appealed from a declaratory judgment awarding to its insurer, Fireman's Fund Insurance Company, all funds in escrow as proceeds from settlement of the policyholder's claims against third parties. The policyholder challenged the allocation of the escrowed funds on the ground that Connecticut's common law "make whole" doctrine entitled it to recover its deductible before its insurer could collect as subrogee. The court held that this issue was undecided under Connecticut law and certified the following question to the Supreme Court of Connecticut: "Are insurance policy deductibles subject to Connecticut's make whole doctrine?"

Appellant, Retail Holdings, N.V. (together with its predecessors, "New Singer"), appealed from a judgment in favor of appellee, Lockheed Martin Corporation (together with its predecessors, "Old Singer"), regarding a dispute revolving around the interpretation of a 1986 Reorganization and Distribution Agreement ("Spin-off Agreement") between appellee's predecessor, The Singer Company, and appellant's predecessor, SSMC, Inc. At issue was whether the Spin-off Agreement transferred a particular pension plan, the Executive Office Foreign Service Retirement Plan ("Plan"), from Old Singer to New Singer. The court reversed the judgment and held that the district court erred in considering extrinsic evidence of the parties' post-contract conduct where the contract admitted only one reasonable interpretation when the Plan was transferred to New Singer by clear and unambiguous terms.

A non-profit hospital ("plaintiff") that provided medical services to beneficiaries of Local 272 Welfare Fund ("Fund"), an employee benefit plan governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. 1101, filed a complaint against defendants seeking payment for over $1 million in medical services provided to beneficiaries that the Fund had allegedly failed to reimburse. At issue was whether a healthcare provider's breach of contract and quasi-contract claims against an ERISA benefit plan were completely preempted by federal law under the two-pronged test for ERISA preemption established in Aetna Health Inc. v. Davila. The court held that an "in-network" healthcare provider may receive a valid assignment of rights from an ERISA plan beneficiary pursuant to ERISA section 502(a)(1)(B); where a provider's claims involved the right to payment and not simply the amount or execution of payment when the claim implicated coverage and benefit determinations as set forth by the terms of the ERISA benefit plan, that claim constituted a colorable claim for benefits pursuant to ERISA section 502(a)(1)(B); and in the instant case, at least some of plaintiff's claims for reimbursement were completely preempted by federal law. The court also held that the remaining state law claims were properly subject to the district court's supplemental jurisdiction.