Mealey's ERISA

  • March 22, 2017

    No Profits To Award From Bank’s Pension Plan Transfer Strategy, Judge Says

    CHARLOTTE, N.C. — Plaintiff employees in a decade-long case over a bank’s illegal transfer of assets from a 401(k) plan to an Employee Retirement Income Security Act pension plan failed to show that any profit was retained by the bank as a result of the transfer, a North Carolina federal judge ruled March 17 in awarding judgment in favor of the bank on the plaintiffs’ accounting-for-profit claim (William L. Pender, et al. v. Bank of America Corp., et al., No. 3:05-cv-00238, W.D. N.C., 2017 U.S. Dist. LEXIS 38771).

  • March 22, 2017

    Drug Makers, Benefit Managers Hit With Class Suit Alleging Insulin Pricing Scheme

    NEWARK, N.J. — Three drug makers and the three largest pharmacy benefit managers have engaged in a pricing scheme to drive up the cost of diabetes insulin — by more than 150 percent in the last five years — in violation of the Racketeer Influenced and Corrupt Organizations Act, the Employee Retirement Income Security Act of 1974, the Sherman Act and numerous state laws, four consumers and Type 1 Diabetes Defense Foundation allege in a March 17 class complaint filed in the U.S. District Court for the District of New Jersey (Julia Boss, et al. v. CVS Health Corporation, et al., No. 17-1823, D. N.J.).

  • March 21, 2017

    Nevada High Court: NLRA, ERISA Don’t Preempt Minimum Wage Amendment

    CARSON CITY, Nev. — Nevada’s Minimum Wage Amendment (MWA), which allows employers to pay a lower minimum wage if they provide health benefits, is not preempted by the National Labor Relations Act (NLRA) or the Employee Retirement Income Security Act of 1974 (ERISA) and is not unconstitutionally vague, the Nevada Supreme Court ruled March 16 (Western Cab Company v. The Eighth Judicial District Court of the State of Nevada, in and for the County of Clark, et al., No. 69408, Nev. Sup., 2017 Nev. LEXIS 16).

  • March 16, 2017

    Georgia Federal Judge Denies Motions To Dismiss Excessive Fees Lawsuit

    ATLANTA — A Georgia federal judge on March 7 mostly denied two motions to dismiss an Employee Retirement Income Security Act lawsuit against 401(k) investment manager Reliance Trust Co. and Insperity Inc., a professional employer organization, saying that plaintiffs sufficiently alleged that the defendants acted as fiduciaries concerning administrative and record-keeping fees for the 401(k) plan (Ronda A. Pledger, et al. v. Reliance Trust Co., et al., No. 1:15-cv-04444, N.D. Ga.).

  • March 16, 2017

    Oregon Federal Judge Refuses To Certify Class Of Naturopath Patients

    PORTLAND, Ore. — An Oregon federal judge on March 9 denied a motion to certify a class of persons who were enrolled in an employer-issued health plan administered by Health Net Health Plan of Oregon who claimed that the plan discriminated against naturopathic physicians, finding that the plaintiffs lacked standing to sue because they could not show that they suffered an injury-in-fact (Eileen Fox-Quamme, et al. v. Health Net Health Plan of Oregon Inc., et al., No. 3:15-cv-01248, D. Ore., 2017 U.S. Dist. LEXIS 35964).

  • March 16, 2017

    Insurance Associations File Emergency Injunction Motion Over DOL’s Fiduciary Rule

    DALLAS — A Texas federal judge on March 14 instructed a coalition of insurance associations opposed to the U.S. Department of Labor’s (DOL) new “fiduciary rule” to file a supplemental brief to their emergency motion for an injunction pending appeal of a ruling that the DOL has not exceeded its authority in formulating the new rule and that the new rule does not violate the Employee Retirement Income Security Act (Chamber of Commerce of the United States of America, et al. v. Edward Hugler, Acting Secretary of Labor, et al., No. 3:16-cv-1476, consolidated with  3:16-cv-1530,  3:16-cv-1537,  N.D. Texas).

  • March 15, 2017

    Judge Adopts Magistrate’s Finding That Government Exclusion Negates Defense Duty

    SHERMAN, Texas — A Texas federal judge on March 2 adopted a magistrate’s report that recommended granting an insurer’s request for a declaration that it has no duty to defend or indemnify its insureds against an underlying lawsuit because coverage is barred by the policy’s government exclusion (Continental Casualty Co. v. Jeffrey Ramsey, et al., No. 16-00125, E.D. Texas).

  • March 14, 2017

    6th Circuit Affirms Court’s Decision To Uphold Denial Of ERISA Benefits

    CINCINNATI — The Sixth Circuit U.S. Court of Appeals on March 9 held that an insurer’s decision to deny an insured’s benefits is supported by substantial evidence notwithstanding the insurer’s inherent conflict of interest as both the plan administrator and payer, affirming a lower federal court’s decision to uphold the denial of benefits sought under Section 502(a) of the Employee Retirement Income Security Act (Daniel Collins v. Unum Life Insurance Company of America, No. 16-3918, 6th Cir., 2017 U.S. App. LEXIS 4322).

  • March 13, 2017

    Texas Federal Judge Denies Motion To Amend ERISA Complaint Against BP

    HOUSTON — A Texas federal judge on March 8 denied a motion filed by participants and beneficiaries of BP entities’ employee investment and savings plans covered by the Employee Retirement Income Security Act to file an amended complaint related to the Deepwater Horizon Gulf of Mexico oil spill that resulted in a steep drop in the BP stock price for failure to state a claim (In Re:  BP P.L.C. Securities Litigation, In re: BP ERISA Litigation, No. 4:10-cv-4214, S.D. Texas, 2017 U.S. Dist. LEXIS 33302).

  • March 10, 2017

    8th Circuit Panel Remands ABB Retirement Plan Case For Recalculation Of Losses

    ST. LOUIS — An Eighth Circuit U.S. Court of Appeals panel on March 9 remanded to Missouri federal court a case in which ABB Inc. fiduciaries were found to have abused their discretion and breached their fiduciary duties in choosing investment options for their 401(k) retirement plans, saying that the lower court seems to have mistook a recommendation on how to measure plan losses (Ronald C. Tussey, et al. v. ABB Inc., et al., No. 15-2792, 8th Cir., 2017 U.S. App. LEXIS 4225).

  • March 9, 2017

    New York Federal Judge: Record-Keeper Services Didn’t Give Rise To Fiduciary Duty

    NEW YORK — A New York federal judge on March 7 granted a motion to dismiss an Employee Retirement Income Security Act lawsuit alleging that a record-keeper breached its fiduciary duty by preventing ERISA plans from getting a more competitive rate for record-keeping services, finding that the record-keeper was not a fiduciary of the plans (Elaine Malone, et al. v. Teachers Insurance and Annuity Association of America, No. 15-cv-08038, S.D. N.Y., 2017 U.S. Dist. LEXIS 32308).

  • March 9, 2017

    Alabama Federal Judge Says Insurer’s Interpretation Was Arbitrary And Capricious

    MONTGOMERY, Ala. — A disability insurer’s interpretation of a tolling provision to extend the 45-day time deadline to decide an administrative appeal was arbitrary and capricious, an Alabama federal judge said March 7 in partially adopting a magistrate judge’s recommendation to deny the insurer’s motion for summary judgment (Melissa Stevens v. Sun Life and Health Insurance Co. [U.S.], No. 16-76, M.D. Ala., 2017 U.S. Dist. LEXIS 31734).

  • March 6, 2017

    Judge Permits Late Class Claims In Insurance Spat Involving Autism Treatment

    BENTON, Ill. — Plaintiffs’ failure to include class allegations in their complaint does not excuse the oversight, but because an insurer was on notice of the claims, the late addition does not warrant denying leave to amend in a case challenging the reduction of coverage for autism treatments, a federal judge in Indiana held Feb. 15 (W.P., et al. v. Anthem Insurance Companies Inc., No. 15-562, S.D. Ind., 2017 U.S. Dist. LEXIS 21424).

  • March 6, 2017

    Colorado Magistrate Says Class Action Lawsuit Against Oracle Corp. Should Proceed

    DENVER — A Colorado magistrate judge on Feb. 16 recommended that a proposed class action challenging the fees in Oracle Corp.’s 401(k) plan proceed, saying that the plaintiffs have met their pleading obligations (Deborah Troudt, et al. v. Oracle Corp., et al., No. 1:16-cv-00175, D. Colo., 2017 U.S. Dist. LEXIS 22194).

  • March 6, 2017

    Texas Federal Judge Lets Cigna Units’ Claims Against Surgical Centers Proceed

    HOUSTON — A Texas federal judge on Feb. 15 ruled that two Cigna units may proceed on their claims under the Employee Retirement Income Security Act for fraud, negligent misrepresentation, civil conspiracy and injunctive and declaratory relief in an action alleging that ambulatory surgical centers waived payments for out-of-network patients but billed insurers as if the patients had paid (Connecticut General Life Insurance Co., et al. v. Elite Center for Minimally Invasive Surgery LLC, et al., No. 4:16-cv-00571, S.D. Texas, 2017 U.S. Dist. LEXIS 21026).

  • March 6, 2017

    Kansas Federal Judge Grants DOL Summary Judgment In Fiduciary Rule Lawsuit

    TOPEKA, Kan. — A Kansas federal judge on Feb. 17 granted the U.S. Department of Labor’s (DOL) motion for summary judgment in a lawsuit challenging the DOL’s new fiduciary rule, saying that a plaintiff insurance agency failed to prove violations of the Administrative Procedure Act (APA) and the Regulatory Flexibility Act of 1980 (RFA) as a matter of law (Market Synergy Group Inc. v. United States Department of Labor, et al., No. 16-cv-4083, D. Kan., 2017 U.S. Dist. LEXIS 23155).

  • March 3, 2017

    California Federal Judge OKs Settlement In Dispute Over Offset Of Veterans’ Benefits

    OAKLAND, Calif. — A California federal on March 1 approved a class action settlement between former U.S. veterans and Liberty Life Assurance Company of Boston after determining that the terms of the settlement, which provides compensation to class members whose disability benefits were offset or reduced by Liberty Life, are reasonable (James L. Bush v. Liberty Life Assurance Company of Boston, et al., No. 14-1507, N.D. Calif.).

  • March 3, 2017

    Arkansas Federal Judge: ERISA Preempts State Law That Regulates PBMs

    LITTLE ROCK, Ark. — An Arkansas federal judge on March 1 granted a pharmacy benefit managers (PBM) trade association summary judgment on its claim that Arkansas Act 900, a law that requires PBMs to pay pharmacies the amounts those pharmacies spent to buy generic drugs from wholesalers, is preempted by the Employee Retirement Income Security Act and denied the state of Arkansas’ motion for summary judgment because Act 900 is invalid as applied to PBMs in their administration and management of ERISA plans (Pharmaceutical Care Management Association v. Leslie Rutledge, No. 4:15-cv-00510 BSM, E.D. Ark.).

  • March 3, 2017

    Respondents, Amici Argue ERISA Requires Church Plans To Be Established By A Church

    WASHINGTON, D.C. — The church plan exemption in the Employee Retirement Income Security Act unambiguously requires that a church plan be established by a church, the appellee-respondents in three cases consolidated before the U.S. Supreme Court say in their initial brief filed Feb. 16, a view shared by five amicus briefs filed in support of the respondents (Advocate Health Care Network, et al. v. Maria Stapleton, et al., No. 16-74, Saint Peter’s Healthcare System, et al. v. Laurence Kaplan, No. 16-86, Dignity Health, et al. v. Starla Rollins, No. 16-258, U.S. Sup., 2017 U.S. S. Ct. Briefs LEXIS 515).

  • March 3, 2017

    9th Circuit Panel: Judge Erred In Holding Job Resignation ‘Voluntary’

    PASADENA, Calif. — A Ninth Circuit U.S. Court of Appeals panel on Feb. 17 remanded an Employee Retirement Income Security Act case with instructions to enter summary judgment in favor of a man whose late wife lost her severance pay when she was forced to leave her job because of a disabling illness, saying a California judge erred in ruling that it was a “voluntary resignation” (Stanley Hoffman, et al. v. American Society for Techion-Israel Institute of Technology, No. 15-55756, 9th Cir., 2017 U.S. App. LEXIS 2837).