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Mealey's ERISA

  • September 18, 2020

    Review Of Circuit Decision Allowing Reformation Of Retirement Plan Not Warranted

    WASHINGTON, D.C. — The Second Circuit U.S. Court of Appeals did not create a circuit conflict in ruling that a lower court had the authority to reform an ERISA-governed retirement plan and then enforce that newly reformed plan toward money damages for class action plaintiffs, the plan participants argue in a Sept. 16 response in opposition to a petition for writ of certiorari filed in the U.S. Supreme Court by PricewaterhouseCoopers LLP (PwC) and others (PricewaterhouseCoopers LLP, et al. v. Timothy D. Laurent, et al., No. 20-28, U.S. Sup.).

  • September 18, 2020

    Rehearing Of Judgment On Treatment Denial Warranted, Plan Administrator Contends

    DENVER — The 10th Circuit U.S. Court of Appeals should grant a petition for rehearing or rehearing en banc because a panel majority of the court created a circuit split when it determined that the administrator of an ERISA-governed health plan for Microsoft Corp. employees failed to reserve its discretionary authority and, therefore, should not have enjoyed a deferential "arbitrary-and-capricious" standard of review from a Utah federal court that determined that the administrator incorrectly denied coverage for psychiatric residential treatment for a teenage girl, the administrator contends in a Sept. 4 petition (Lyn M., et al. v. Premera Blue Cross, et al., No. 18-4098, 10th Cir.).

  • September 17, 2020

    ERISA J&J Stock Class Defends Claims That Fiduciaries Failed To Act

    NEWARK, N.J. — A recently reinstated Second Circuit U.S. Court of Appeals case and fresh allegations regarding incorporation of Johnson & Johnson regulatory filings into plan documents preserve a case claiming that the fiduciaries caused $30 million in damages by investing in knowingly inflated company stock, a class says in a Sept. 14 opposition to dismissal (Michael Perrone, et al. v. Johnson & Johnson, et al., No. 19-923, D. N.J.).

  • September 17, 2020

    New York Federal Judge Lifts Stay In IBM Retirement Plan Row

    NEW YORK — Just over a week after filing a petition for writ of certiorari, International Business Machine Corp. (IBM) failed to persuade a New York federal judge to continue his June 2019 stay of the case, with the judge on Sept. 11 instead ordering parties in the case to propose a discovery schedule by Sept. 23 (Larry W. Jander, et al. v. Retirement Plans Committee of IBM, et al., No. 15-3781, S.D. N.Y.).

  • September 16, 2020

    Benefit Fund Dispute Must Be Decided By Court, Not Arbitrator, Panel Affirms

    PHILADELPHIA — A district court did not err in refusing to compel arbitration in a dispute over contributions to a laborers' benefit fund and in finding that the court possessed jurisdiction to decide the dispute because the formation of the contract that contained the arbitration provision was at issue, the Third Circuit U.S. Court of Appeals said Sept. 14, noting that the Federal Arbitration Act (FAA) provides that any disputes over contract formation are for courts to decide (MZM Construction Co. Inc., et al. v. New Jersey Building Laborers Statewide Benefit Funds, Nos. 18-3791 & 19-3102, 3rd Cir., 2020 U.S. App. LEXIS 29039).

  • September 15, 2020

    Participants In Retirement Plan Deny Claims Of Intracircuit, Circuit Conflict

    RICHMOND, Va. — In a Sept. 10 filing, appellants who successfully persuaded the Fourth Circuit U.S. Court of Appeals in August to reverse and remand dismissal of their putative class action over alleged breaches of fiduciary duties of prudence and diversification in a 401(k) retirement plan urge the court to reject a recent petition for rehearing or rehearing en banc in the case (Christina Stegemann, et al. v. Gannett Company, Inc., et al., No. 19-1212, 4th Cir.).

  • September 15, 2020

    9th Circuit Says No Authority Supports Excess Insurer's 'Improper Erosion' Theory

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals on Sept. 14 reversed a lower federal court's grant of summary judgment in favor of a second excess insurer in its lawsuit alleging that a primary and first excess insurer's payment of an uncovered claim arising from the insured's settlement of alleged violations of the Employee Retirement Income Security Act (ERISA) improperly eroded their policies' liability limits and prematurely triggered its excess coverage, remanding for further proceedings (Axis Reinsurance Co. v. Northrop Grumman Corporation, No. 19-55135, 9th Cir.).

  • September 14, 2020

    Abbott Labs Moves To Dismiss Case Involving Theft Of Plan Funds

    CHICAGO — In two Sept. 9 reply briefs, Abbott Laboratories and co-defendants argue in Illinois federal court that they are entitled to dismissal of allegations that they breached their fiduciary duty in connection with the identity theft of an Abbott retiree which purportedly resulted in a $245,000 loss to her 401(k) retirement account (Heidi Bartnett v. Abbott Laboratories, et al., No. 20-2127, N.D. Ill.).

  • September 11, 2020

    Health Plan Participants Say Injunction Against Plan Administrators Is Necessary

    LOS ANGELES — A preliminary injunction should be issued against the plan administrators of  a health plan for film and television workers to ensure that all members of the plan are provided with health insurance premium waivers and other subsidies offered to some plan participants in response to the COVID-19 pandemic shutdown of the entertainment industry, a pair of cinematographers contend in their Sept. 4 reply in support of a motion for preliminary injunction filed in California federal court (Greg Endries, et al. v. Board of Directors of the Motion Picture Industry Health Plan, et al., No. 20-6347, C.D. Calif.).

  • September 10, 2020

    Court Affirms Expert, Record-Only Review Rulings In ERISA Mental Health Case

    BOSTON — An insurer and district court did not err in relying on experts who referenced 24-hour care when determining that residential treatments were not medically necessary, and review in Employee Retirement Income Security Act cases is limited to the administrative record and does not require live testimony or cross-examination, a First Circuit U.S. Court of Appeals panel held Sept. 9 (Jane Doe v. Harvard Pilgrim Health Care Inc., et al., No. 19-1879, 1st Cir.).

  • September 10, 2020

    IBM Seeks High Court Review Of Ruling For Plan Participants

    WASHINGTON, D.C. — The U.S. Supreme Court should review the Second U.S. Circuit Court of Appeals panel's decision to reinstate an earlier ruling that participants in a stock option plan for IBM employees had plausibly alleged that plan fiduciaries breached their duties under the Employee Retirement Income Security Act by failing to disclose alleged corporate fraud because the Second Circuit's decision reestablishes the same circuit split that the high court previously agreed to review, the IBM plan committee contends in a Sept. 1 petition for writ of certiorari (Retirement Plans Committee of IBM, et al. v. Larry W. Jander, et al, No. 20-289, U.S. Sup.).

  • September 10, 2020

    Plaintiffs Have Standing To Bring Claims Alleging Breach Of Duties Of Loyalty, Prudence

    LOS ANGELES — A California federal judge on Sept. 1 denied a motion to dismiss filed by defendants accused of breaching their duties of prudence and loyalty under the Employee Retirement Income Security Act because the plaintiffs demonstrated that they have standing to bring their claims and adequately alleged facts in support of their claims for relief (Merry Russitti Diaz, et al. v. Westco Chemicals Inc., et al., No. 20-2070, C.D. Calif.).

  • September 09, 2020

    PricewaterhouseCoopers Seeks To Decertify Class In Pension Benefit Calculation Lawsuit

    NEW YORK — A class of former PricewaterhouseCoopers LLP (PwC) employees who elected to receive lump-sum payments from a cash-balance pension plan should be decertified because a recent Second Circuit U.S. Court of Appeals ruling in the case that authorized a "novel two-step remedy" undermined the basis for the 2014 certification of the class, PwC tells a federal judge in New York in its Aug. 14 reply brief in support of its motion to decertify the class (Timothy D. Laurent, et al. v. PricewaterhouseCoopers LLP, et al., No. 06-cv-2280, S.D. N.Y.).

  • September 09, 2020

    Amici Weigh In On Supreme Court Dispute Over Fiduciary Status

    WASHINGTON, D.C. — In amicus briefs filed July 20 and 21, respectively, the Stable Value Investment Association (SVIA) and the American Council of Life Insurers (ACLI) urged the U.S. Supreme Court to grant a June 2020 petition for certiorari by a 401(k) plan service provider adjudged by the Eighth Circuit U.S. Court of Appeals to qualify as a fiduciary (Principal Life Insurance Co. v. Frederick Rozo, et al., No. 19-1462, U.S. Sup.).

  • September 09, 2020

    Georgia Subclass Breach Claims Dismissed In Inflated Drug Prices Suit

    NEW HAVEN, Conn. — A federal judge in Connecticut on Aug. 31 in a putative class complaint accusing Cigna Health and Life Insurance Co. (CHLIC) and OptumRx Inc. of scheming to overcharge for prescription drugs granted CHLIC's partial motion to dismiss two claims brought by a Georgia employee on behalf of a Georgia subclass, finding CHLIC was not a party to that employee's plans (Kimberly A. Negron, et al. v. Cigna Health and Life Insurance Company, et al., No. 16-1702, D. Conn., 2020 U.S. Dist. LEXIS 157660).

  • September 09, 2020

    Ex-Employee Says Steel Firms Violated ERISA, ADA, HIPAA To Lower COVID-19 Liability

    KANSAS CITY, Mo. — An ex-employee of a Kansas-based steel conglomerate alleges in an Aug. 26 complaint filed in the U.S. District Court for the Western District Of Missouri that management of the steel firms misappropriated sensitive medical information of hundreds of its employees in a scheme to mitigate liability from the novel coronavirus pandemic and then retaliated against and ultimately fired him for reporting the abuse of privacy (Micah Morrison v. SPS Companies Inc., et al., No. 5:20-cv-06129, W.D. Mo.).

  • September 09, 2020

    Lobbying Group Argues To 9th Circuit: ERISA Preempts Seattle Hotel Benefit Law

    SAN FRANCISCO — An ERISA-focused lobbying group on Aug. 27 argued in an appellant brief to the Ninth Circuit U.S. Court of Appeals that a Washington federal court erred in ruling that a Seattle city ordinance that requires large hotels to spend certain amounts on health coverage for their employees does not trigger preemption by the Employee Retirement Income Security Act (The ERISA Industry Committee v. Seattle, No. 20-35472, 9th Cir.).

  • September 09, 2020

    Interlocutory Appeal Of ERISA Exhaustion And Time-Bar Issues Not Justified, Participant Says

    NEW YORK — A participant in Goldman Sachs' 401(k) plan told a federal judge in New York on Sept. 4 that Goldman Sachs failed to satisfy the "strict prerequisites" for interlocutory appeal of the district court's rulings that Employee Retirement Income Security Act's limitations period controls, despite a shorter period specified in the plan, and that exhaustion of administrative remedies is not required for ERISA statutory claims that Goldman Sachs and plan managers breached their fiduciary duties by maintaining underperforming, high-cost, proprietary funds in the plan (Leonid Falberg v. The Goldman Sachs Group Inc., et al., No. 19-9910, S.D. N.Y.).

  • September 09, 2020

    Judge Grants Jurisdictional Discovery In ERISA Case Against Bermuda Reinsurer

    WASHINGTON, D.C. — A District of Columbia federal judge on Sept. 2 refused to dismiss an Employee Retirement Income Security Act lawsuit against a Bermuda reinsurance and insurance company for damages from the alleged failure to make $934 million in withdrawal liability payments and, instead, granted plan trustees' motion for jurisdictional discovery (Michael H. Holland, et al. v. Cardem Insurance Company Ltd., No. 19-02362, D. D.C.).

  • September 09, 2020

    ERISA Plan Participants To 1st Circuit: Fidelity Is Functional Fiduciary

    BOSTON — Participants in 401(k) plans that contracted with Fidelity to be the plans' service provider told the First Circuit U.S. Court of Appeals on Sept. 4 that a federal judge in Massachusetts erred in holding that Fidelity entities do not qualify as fiduciaries under the Employee Retirement Income Security Act and in dismissing their claims that Fidelity violated ERISA's fiduciary duty and prohibited transaction provisions by receiving infrastructure fees from third-party mutual funds (In re: Fidelity ERISA Fee Litigation [Andre W. Wong, et al. v. FMR LLC, et al.], No. 20-1286, 1st Cir.).