Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

Plaintiffs filed suit, alleging that ESI is systematically denying payment of compound drug claims without adhering to the procedural requirements of the Employee Retirement Income Security Act's "Claims Regulation." 29 U.S.C. 1001 et seq. The court concluded that there is no need for injunctive relief under section 502(a)(3), or for equitable relief to enforce or clarify the beneficiary’s rights under the plan under section 502(a)(1)(B). In this case, the district court did not abuse its discretion in denying the preliminary injunction requested by plaintiffs as assignees of plan beneficiaries because plaintiffs have cited no reported decision, and the court has found none, where a circuit court has upheld a private plaintiff’s claim for injunctive relief mandating the future procedures an ERISA plan must follow to comply with the Claims Regulation. In the alternative, the court concluded that plaintiffs do not have standing under ERISA to assert harm to themselves because they are not ERISA beneficiaries. Accordingly, the court affirmed the judgment. View "Grasso Enter. v. Express Scripts" on Justia Law

McCaffree brought a class action suit on behalf of participating employees against Principal, the company with whom McCaffree had contracted to provide a retirement plan’s investment options, alleging that Principal had charged McCaffree’s employees excessive fees in breach of a fiduciary duty Principal owed to plan participants under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. The court affirmed the district court's grant of Principal's motion to dismiss for failure to state a claim because McCaffree failed to demonstrate a valid claim under ERISA. In this case, McCaffree's first argument fails because Principal owed no duty to plan participants during its arms-length negotiations with McCaffree, and the remaining four arguments fail because McCaffree did not plead a connection between any fiduciary duty Principal may have owed and the excessive fees Principal allegedly charged. View "McCaffree Fin. Corp. v. Principal Life Ins. Co." on Justia Law

Plaintiff, the executrix of her husband's estate, along with her husband's former business, Federal City, filed suit against Life Investors for conversion and tortious interference with a contract. On appeal, plaintiffs challenged the district court's dismissal of the complaint. The court concluded that this action is not barred by claim preclusion because the claims brought are not based upon the same cause of action as the prior suit. In this case, plaintiffs allege claims for conversion and tortious interference with contract against Life Investors because Life Investors removed over $400,000 from certain accounts to cover expenses above the alleged debt plaintiffs owed Life Investors. Life Investors removed these funds after the decision in the Maryland district court. The Maryland court never determined that plaintiffs lacked any interest in the assets in the accounts. Instead, it decided that plaintiffs were time-barred from bringing claims from a 2000 request for withdrawal of the assets and that the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., claims were either time-barred or failed to allege a violation of ERISA law. Similarly, the claim is not barred by issue preclusion. Accordingly, the court reversed and remanded. View "Corrado v. Life Investors Ins. Co." on Justia Law

Life Investors filed suit against defendants, alleging breach of a settlement agreement that required defendants to repay advances of monies defendants received from Life Investors. On appeal, defendants challenged the district court's grant of summary judgment to Life Investors. The court affirmed, concluding that defendants' laches defense failed because they cannot show unreasonable delay on the part of Life Investors in bringing this suit nor can defendants show that they were prejudiced; even if the alleged inconsistencies were material, defendants chose not to investigate further and thus the determination that they ratified the Settlement Agreement was correct; the district court correctly granted summary judgment on the question of ratification of the Settlement Agreement after certifying that question to the Iowa Supreme Court and receiving its answer; and defendants' attempt to argue an Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., violation as a defense in this action is barred as a matter of issue preclusion. View "Life Investors Ins. Co. v. Federal City Region" on Justia Law

In 2009, Liu, a physician in a residency program, elected basic life insurance coverage from LINA through his employer’s ERISA plan and elected supplemental coverage in an amount four times his salary. Asked whether, within the last five years he had been diagnosed with “Cancer, Tumor, Leukemia, Hodgkin’s Disease, Polyps or Mole,” he answered “no.” One month after submitting his application, Liu received a cancer diagnosis. On March 1, 2010, the insurance became effective. On April 23, 2010, Liu died. LINA paid the basic benefit of $46,858.49, but reviewed Liu’s medical records, which revealed that Liu had been experiencing symptoms without a diagnosis before submitting his November 12 application. LINA then issued a denial, stating: While the form was completed accurately at the time ... a diagnosis of cancer prior to the coverage approval date was not disclosed … [the] Form states ... any changes in your health prior to the insurance effective date must be reported. His wife responded that Liu was told he would not have to provide evidence of good health, but did not identify the person who made the alleged representation. The court rejected the wife’s suit on summary judgment. The Eighth Circuit affirmed. Liu breached an application requirement by failing to notify LINA of a cancer diagnosis he received before a policy issued. View "Huang v. Life Ins. Co. of N. Am." on Justia Law

Kevin and Lisa Nutt worked at Osceola Nursing Home. Funds were withheld from their paychecks as “pre-tax insurance.” After Kevin was injured, they learned that Osceola had not paid premiums. Their policy had lapsed; the Nutts owed $233,000 for medical services. The insurer told Lisa that it could reinstate the policy and pay the bills if Osceola made the delinquent premium payments. Osceola did not do so. Osceola then entered into a contract with Cooper, who specialized in turning around financially troubled nursing homes. Cooper’s company, Berryville, ultimately took title to the property. Before the closing, Cooper could assume management under a temporary lease. Cooper assigned this lease to OTLC, created for the project and owned by Hargis. Though OTLC was independent, Hargis regularly worked with Cooper in nursing-home ventures. OTLC operated the facility for Cooper and Berryville for three years. Nutt told Hargis about the outstanding bills. Days later, OTLC fired both Lisa and Kevin. They sued. The court entered default judgment against Osceola under the Employee Retirement Income Security Act, 29 U.S.C. 1001; found that they could not provide adequate relief; and, on a theory of successor liability, held OTLC liable. The Eighth Circuit reversed, stating that if successor liability required only subsequent operation, it would discourage the free transfer of assets to their most valuable uses. OTLC was not a party to the unlawful practices of Osceola and operated without significant connection to the culpable parties. View "Nutt v. Osceola Therapy & Living Cntr., Inc." on Justia Law

Central States, a multi-employer trust fund governed by ERISA, provides health and welfare benefits to participants in the teamster industry. Student Assurance processed claims for student accident policies. Central States claimed that it paid medical expenses of $137, 204 for 13 junior high, high school, and college student-athletes who were covered dependents under its plan and who sustained athletic injuries. Central States sought reimbursement from Student Assurance, which refused to pay. Central States alleged that according to the coordination of benefits provision of its plan, the student accident policies supply primary coverage for the students’ covered medical expenses. Student Assurance claimed that the student accident policies are excess policies, and that they are not obligated to pay until Central States has reached the maximum contribution under its plan. Central States sued, citing federal common law and section 502(a)(3) of ERISA, seeking declaratory relief, restitution, and the imposition of an equitable lien and constructive trust to secure reimbursement for the benefits paid on behalf of the common insureds. The district court dismissed, and the Eighth Circuit affirmed, holding that the claims, while ostensibly seeking equitable remedies, were actually for legal relief that is unavailable under section 502(a)(3). View "Cent. States, SE & SW Areas Health & Welfare Fund v. Student Assurance Servs., Inc." on Justia Law

Kienstra, a Missouri resident, received treatment for uterine fibroid tumors at the Mayo Clinic in 2008. Her health plan concluded that her treatment fell outside the plan's coverage as experimental and requiring prior approval. Internal appeals failed. The plan is a self-funded multiple employer plan, maintained pursuant to collective bargaining agreements, and subject to the Employee Retirement Income Security Act, 29 U.S.C. 1002(1). The plan specified that any civil action for wrongful denial of medical benefits under ERISA must be filed within two years of the final date of denial. Kienstra filed suit almost two and a half years after she learned her claim had been denied. She unsuccessfully argued that the contractual limitations period was invalid because the plan's rules of construction stated that its terms should be read to comply with Missouri law, that a 10-year Missouri statute of limitations governed, and that a separate statute barred contracting parties from shortening that limitations period. The Eighth Circuit affirmed. There is no conflict between the plan's contractual limitations period and Missouri law; state law does not "apply of its own force to a suit based on federal law—especially a suit under ERISA, with its comprehensive preemption provision." View "Munro-Kienstra v. Carpenters' Health & Welfare Trust Fund of St. Louis" on Justia Law

From 1995-2009, Johnson worked for CRE. In the last three years, Johnson worked from home, 8 hours a day at a computer. Johnson was covered under CRE’s United disability insurance policy. In 1999, Johnson was diagnosed with fibromyalgia. In 2004, she underwent neck surgery for nerve injuries. On the day she resigned, Johnson visited MacDonald, her primary care physician, who diagnosed anxiety, depression, fibromyalgia, and chronic pain. Johnson completed a short-term disability form. MacDonald completed an Attending Physician’s Statement. United denied the application. Based on the recommendations of its doctor, United denied Johnson’s appeal. Johnson sought long-term disability benefits. MacDonald completed a Physician’s Statement that imposed multiple limitations. United denied the claim. Johnson appealed. United referred Johnson’s file and medical records to Boscardin, an orthopedic surgeon, who determined that, although Johnson experienced chronic pain in her neck and spine, Johnson’s complaints were not supported by “conclusive, objective evidence.” McClellan, Johnson’s surgeon, responded that he “[o]verall” agreed with Boscardin. United denied the appeal. Johnson sued under ERISA. The district court granted Johnson summary judgment, finding that United failed to consider Johnson’s condition as a whole. The Eighth Circuit reversed, finding the denial supported by substantial evidence. View "Johnson v. United of Omaha Life Ins. Co." on Justia Law

In 1988, Brake began working at Hutchinson. She was diagnosed with multiple sclerosis (MS) in 2000, but continued to work. Brake purchased disability insurance through Hutchinson’s plan in 1988. Hutchinson, as the plan administrator, ceded discretionary authority to Hartford to construe the plan and make eligibility determinations. In 2007, Brake purchased "buy-up" coverage that excluded a disability if medical treatment for that condition was rendered within 12 months prior to the effective date. The limitation ended after a year without a claim: if Brake was treated for MS between April 1, 2006, and April 1, 2007, and then became disabled as a result of MS before April 1, 2008, the exclusion would limit her benefits to core plan coverage. Brake began experiencing problems with her MS in 2007 and received benefits from a separate short-term disability plan. On March 25, 2008, she stopped working at Hutchinson. In May, she applied for LTD benefits, stating her onset of disability as July 27, 2007. Hartford informed her that her LTD benefits were approved, but not at the buy-up plan rate. Brake claimed that doctor visits during the 12 months were for a pap smear and a yearly routine MRI. Hartford cited the same records which indicated that Brake was increasingly less able to manage her MS conditions during the 12 months before her purchase of buy-up coverage. In Brake’s suit under ERISA, 29 U.S.C. 1001, the district court found that Hartford did not abuse its discretion. The Eighth Circuit affirmed summary judgment in favor of Hartford. View "Brake v. Hutchinson Tech., Inc.," on Justia Law