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

Plaintiffs initially filed suit in state court seeking to enjoin defendant insurers under New York law from obtaining reimbursement of medical benefits from plaintiffs' tort settlements. Defendants removed to federal court where the district court granted defendants' motion to dismiss under Rule 12(b)(6). The court held that plaintiffs' claims did not satisfy the Supreme Court's test for being subject to complete Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., preemption, which would have conferred federal subject-matter jurisdiction; such jurisdiction exists, however, under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d); therefore, the court reached the merits of the express preemption defense and concluded that N.Y. Gen. Oblig. Law 5-335 is saved from express preemption under ERISA section 514, as a law that "regulates insurance;" and therefore, the court vacated and remanded for further proceedings.View "Wurtz v. The Rawlings Co." on Justia Law

Plaintiff filed suit against her employer, Reliastar, under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., after she was denied long term disability benefits. The district court found that Reliastar's benefits determination was arbitrary and capricious, and remanded to the company to calculate the amount of benefits owed. Reliastar appealed. The court dismissed the appeal for lack of appellate jurisdiction, holding that the remand order is not an immediately appealable final decision under either the traditional principles of finality or the court's precedents governing remands to administrative agencies. View "Mead v. Reliastar Life Ins. Co." on Justia Law

Plaintiffs, a class of individuals who participated in the Morgan Stanley 401(k) Plan and the Morgan Stanley Employee Stock Ownership Plan, filed suit alleging violations of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. In January 2007 and 2008, Morgan Stanley elected to make its employer contributions to the Plans in the form of Company Stock instead of cash. After the stock price plunged in conjunction with the broader economic downturn, plaintiffs sought to recover for losses the Plans suffered as a result of the drop in stock price. The Moench "presumption of prudence" is a pleading standard that presumes plan fiduciaries act in "compliance with ERISA when [a plan] fiduciary invests assets in the employer's stock." The district court found that the Moench presumption of prudence applied to defendants' conduct and that plaintiffs failed to rebut this presumption. The court affirmed the district court's motion to dismiss on the district court's alternative ground because the challenged conduct, even if it negatively impacted the Plans, did not occur in the performance of a fiduciary function and therefore could not trigger fiduciary liability under ERISA. Absent fiduciary liability, plaintiffs' secondary claims also failed. View "Coulter, et al. v. Morgan Stanley & Co. Inc., et al." on Justia Law

Plaintiffs filed suit against the Plan under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1054(g). At issue was whether the anti-cutback rule in section 204(g) precluded plan amendments that reduced retirement-type subsidiaries for plan participants who have ceased employment without satisfying the preamendment conditions for the subsidy, but who could later satisfy the preamendment conditions without returning to work. The court held that the rule protected such benefits. Plaintiffs have satisfied the preamendment conditions and their benefits were protected by the anti-cutback rule. Accordingly, the court affirmed the judgment of the district court. View "Alcantara v. Bakery and Confectionery Union" on Justia Law

In 2004, plaintiff appealed the denial of his long term disability (LTD) benefits under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. Liberty moved for summary judgment. In a 2009 Report and Recommendation (R&R), the magistrate judge recommended denying Liberty's motion and granting summary judgment sua sponte to plaintiff. In 2012, the district court adopted the R&R and entered summary judgment for plaintiff, but denied his request for attorneys' fees. The court concluded that the district court did not err in granting summary judgment on plaintiff's claim for LTD benefits because Liberty's denial of LTD benefits was arbitrary and capricious where Liberty ignored substantial evidence from plaintiff's treating physician that he was incapable of performing his current occupation, while failing to offer any reliable evidence to the contrary; the court retained discretion to consider the Chambless v. Masters, Mates & Pilots Pension Plan factors, in determining whether to grant an eligible plaintiff's request for attorneys' fees, but must do so in a manner consistent with the court's case law, and could not selectively consider some factors while ignoring others; the district court misapplied the Chambliss framework, and therefore erred, in denying fees to a prevailing plaintiff primarily on the conclusion that Liberty had not acted in bad faith; and the record revealed no particular justification for denying plaintiff's attorneys' fees, and awarding fees in the circumstances presented here furthered the policy interest in vindicating the rights secured by ERISA. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "Donachie v. Liberty Mutual Ins. Co., et al." on Justia Law

A Vermont statute requires all "health insurers" to file with the State reports containing claims data and other "information relating to health care." Liberty Mutual sought a declaration that the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., preempted the Vermont statute and regulation. The district court granted summary judgment in favor of Vermont. The court held that the reporting requirements of the Vermont statute and regulation have a "connection with" ERISA plans and were therefore preempted as applied. The court's holding was supported by the principle that "reporting" is a core ERISA function shielded from potentially inconsistent and burdensome state regulation. Accordingly, the court reversed and remanded with instructions to enter judgment for Liberty Mutual. View "Liberty Mutual Ins. Co. v. Donegan" on Justia Law

Plaintiffs filed suit under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., against Xerox, the Plan, and the Plan Administrator. The Supreme Court reversed the court's most recent decision, holding that the court had erred in holding that, having found the Administrator's first interpretation of the retirement plan to be invalid, the district court properly refused to defer to the plan administrator's subsequent interpretation of the plan. On remand, the district court applied deferential review, holding that the Administrator's proposed offset was a reasonable interpretation of the retirement plan. The court held, however, that the proposed offset was an unreasonable interpretation of the retirement plan and that it violated ERISA's notice provisions. Although the court upheld the challenged discovery order, the court vacated the judgment and remanded for further proceedings. View "Frommert v. Conkright" on Justia Law

Plaintiff filed suit against her former employer, Andalex, alleging claims of discrimination, retaliation, and hostile work environment under federal and state law, as well as claims that Andalex failed to notify her of her right to continuing health care coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), 29 U.S.C. 1166 et seq. The district court granted summary judgment in favor of Andalex and dismissed her claims. The court affirmed the district court's judgment except with respect to plaintiff's retaliation claims. Based on the discrepancies between the EEOC statement and subsequent testimony, a reasonable juror could infer that the explanation given by Andalex was pretextual, and that, coupled with the temporal proximity between the complaint and the termination, the complaint at issue was a but-for cause of defendant's termination. Accordingly, there was sufficient evidence to require denial of the summary judgment motion on the retaliation claims. View "Kwan v. The Andalex Group LLC" on Justia Law

Village Fuel appealed the district court's denial of attorney's fees in an Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., action. The court concluded that Village Fuel obtained some degree of success on the merits in defeating GHI's restitution claims and that, under ERISA, a favorable court judgment was not required to satisfy the threshold of awarding attorney's fees. The court vacated and remanded to the district court for further proceedings to determine a reasonable amount of attorney's fees, if any, to be awarded to Village Fuel. View "Scarangella & Sons v. Group Health, Inc." on Justia Law

Plaintiffs, former Lehman employees, filed suit alleging that defendants, members of the Benefits Committee, and the company's Directors, breached their duties under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. In regards to plaintiffs' claims that the Benefits Committee Defendants breached their duty of prudence in managing the company's employee stock ownership plan (ESOP), the court concluded that plaintiffs have not rebutted the Moench v. Robertson presumption because they failed to allege facts sufficient to show that the Benefits Committee Defendants knew or should have known that Lehman was in a "dire situation" based on information that was publicly available during the class period. In regards to plaintiffs' claims that the Benefits Committee Defendants breached their duty of disclosure, the publicly-known information available to defendants did not give rise to an independent duty to investigate Lehman's SEC filings prior to incorporating their content into a summary plan description issued to plan-participants. The court affirmed the district court's dismissal of plaintiffs' remaining claims. View "In Re: Lehman Bros. ERISA Litig." on Justia Law