Sunday, January 3, 2010

Eleventh Circuit Affirms Summary Judgment Against Insured In ERISA Benefits Case

In an unpublished decision, the Eleventh Circuit affirmed the district court in Stuart S. Johnson v. UNUM Provident, et al (09-13687).  Like the published opinion from the Eleventh Circuit released on the same day and discussed HERE, this decision relates to ERISA.  The facts were described as follows:
Stuart S. Johnson participated in a group disability policy issued by Unum Life Insurance Company of America.1 In 1999, Johnson applied to Unum for long-term disability benefits. Unum denied the application. Johnson asked Unum to review its decision to deny benefits three separate times. But, Unum upheld the denial each time, and in a letter dated March 22, 2001, Unum informed Johnson of its decision after the third and final review of the claim....Johnson filed suit against Unum in the United States District Court for the Northern District of Alabama on October 22, 2008, asserting five state-law claims.
Unum moved for summary judgment, which the court granted. The court held that ERISA preempted Johnson’s claims for breach of contract, equitable estoppel, and restitution.  As to the claim for breach of the covenant of good faith and fair dealing and the claim for willful and/or wanton misconduct, the court held that they were not preempted by ERISA, but they were nonetheless barred by the Alabama statute of limitations.  The court also held that Johnson’s ERISA claims were barred by the statute of limitations.
The Eleventh Circuit first determined whether the claims are preempted by ERISA. "Complete or 'super preemption' exists where a plaintiff seeks relief that is available under 29 U.S.C. § 1132(a), the civil enforcement provisions of ERISA."  Citing to Butero v. Royal Mccabees Life Ins. Co., 174 F.3d 1207, 1212 (11th Cir. 1999), the court applied a four part test.  Notably, in a published opinion released on the same day, see Connecticut State Dental v. Anthem Health Plans (08-15268), the Eleventh Circuit held that the Butero test was modified by the United States Supreme Court in Aetna Health Inc. v. Davila, 542 U.S. 200, 210, 124 S. Ct. 2488, 2496 (2004). Connecticut State Dental was discussed HERE.  In the published opinion, the court stated "While similar to the Butero test, Davila refines Butero by inquiring about the existence of a separate legal duty, which is not a consideration under Butero."

The court then stated:
We agree with the district court’s well-reasoned analysis concluding that Johnson’s claims for breach of contract, equitable estoppel, and restitution were subject to super preemption.  ERISA may or may not also preempt Johnson’s remaining state-law claims. In any event, as discussed below, these claims are barred by Alabama’s statute of limitations even if they are not preempted by ERISA. So, we do not consider whether the court erred in concluding that ERISA did not preempt these claims.
Finally, we address whether Johnson’s ERISA claims are barred by the statute of limitations. ERISA does not provide its own statute of limitations. Courts either borrow a closely analogous state limitations period, or they apply a contractually agreed upon period, provided it is reasonable.  Johnson’s cause of action accrued, at the latest, when Unum denied his claim for benefits. This occurred no later than March 22, 2001, after the third and final review of Johnson’s claim. The three-year limitations period expired on March, 22, 2004, more than four years before Johnson filed suit....we see no reason to conclude that the district court’s conclusion was clear error. Therefore, we affirm the dismissal of Johnson’s preempted state-law claims and Johnson’s ERISA claim as time-barred.


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