by Cody AllisonNew ERISA Suit filed against Salesforce
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
For those of you who may not know, Salesforce is a software company that concentrates on customer relationship management, marketing automation, analytics and application development. This year, Fortune magazine voted Salesforce as number 6 on its list of top 100 companies to work for based on employee satisfaction.
Now, a suit has been filed in the U.S. District Court for the Northern District of California seeking class-action status for a group of retirement plan and long-term disability beneficiaries and recipients.
The suit alleges that Salesforce had over $2 billion dollars in assets as of the end of 2018 and that the size of its retirement plan gives it substantial bargaining power in order to negotiate lower fees for both investment products and bookkeeping services. However, the suit alleges, Salesforce failed to do so. The complaint alleges, ” “Defendants, however, did not try to reduce the plan’s expenses or exercise appropriate judgement to scrutinize each investment option that was offered in the plan to ensure it was prudent.”
Specifically, Salesforce is accused of failing to take advantage of low-cost share classes in mutual funds and failing to consider alternatives to mutual funds such as collective investment trusts.
Interestingly, the case filing documents show that Salesforce had actually made some of the changes by the time the suit was filed, but the suit alleges that these changes should have happened much earlier and that the fiduciaries should be financially responsible for reimbursement for these costs to the plan.
These kinds of suits are becoming more and more common under ERISA. Beneficiaries of retirement and long-term disability plans are starting to scrutinize fiduciaries for their actions in maintaining the benefit pool.
This case has not been resolved to date. We will be watching it and update this post as needed.
by Cody AllisonCOVID-19 and High Risk Individuals Under ERISA
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
In this time of the COVID-19 pandemic, we are getting questions about just how a person who might not be able to return to work because of some medical condition which might put them at an unacceptable risk should they contract the virus is to be treated under short and long term disability plans and under ERISA. The short answer to this question is that we just don’t know yet.
Generally, under most long term and short term plans, individuals who are not yet sick don’t qualify for benefits. So, as an example, let’s say that you have cystic fibrosis or muscular dystrophy, but it is being managed and you are still able to work. The management program involves an immunosuppressant. It would be very dangerous for you to return to work in an environment where the COVID-19 virus could easily be transmitted. What should you do?
The first thing you need to do is to check your policy. You will need to determine what the definitions of the words “sick” and “illness” are under your policy. Then, you will need to complete an application for benefits with your carrier, and make sure that the problems you set out fit within the definitions of your policy.
It is crucial when you do this that you set out the higher risk to you of exposure to COVID-19. In other words, you don’t want to just list muscular dystrophy or cystic fibrosis as the reason for your application — you need to clearly set out the increased risk of illness and/or death from the virus in light of your treatment for muscular dystrophy. In this circumstance, if your doctor is telling you of the danger of a return to work, it would be beneficial to have him put this in writing and attach it to the application. Be aware that even this tactic may not be successful in light of excusions for “future risk” or “possible loss.” Your policy may simply not cover you for what might happen but hasn’t yet happened.
This is the state of the law today. It may change. We are living in a new world now and the courts and policy makers are going to have to take this into account and make allowances. We will keep watching this area of the law will provide updates as we see them.
by Cody AllisonSignificant New ERISA Case on Statute of Limitations
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
As many of you may know, companies often fund their long-term and short-term disability policies by having the plan fiduciaries invest the company money in order to grow it over the long term to be able to pay benefits. Sometimes, these fiduciaries recklessly invest the money and it ends up significantly reduced or lost altogether, so that the company has no money to pay employee benefits. How long would an employee of a company have to bring a suit against these fiduciaries for dissipating this money?
The U.S. Supreme Court has addressed this issue in the case of Intel Corporation Investment Policy Committee v. Sulyma, case no. 18-1116. decided in the spring of 2020.
Under ERISA Section (413(2), a claim for breach of fiduciary duty can be brought within six years of the date of the breach. However, the statute of limitations date is shortened if the plaintiff in the suit had “actual knowledge” of the breach. The problem is that ERISA does not define what is meant by “actual knowledge.”
In this case, Sulyma filed suit within the six year limitations period, but outside the three year limitations period. The fiduciary argued that the three year limitations period should apply because Sulyma had received disclosures of the investments which would have given him actual knowledge of the bad investments. Sulyma testified that he did not recall reviewing these disclosures.
The district court granted summary judgment to the fiduciary, but the Ninth Circuit Court of Appeals reversed this. The Supreme Court unanimously affirmed this reversal. The Supreme Court held that the phrase “actual knowledge” means that the plaintiff must actually know about the alleged breach in order for the three-year statute of limitations to start. In coming to this conclusion, the Supreme Court rejected the argument that Section 413(2) of ERISA should be considered a “constructive-knowledge requirement” and that once a plaintiff receives a disclosure, he has the requisite knowledge since “he could acquire it with reasonable effort.” Evidence that the plaintiff had been provided with the relevant information is not sufficient for this purpose without additional evidence that the plaintiff actually read the materials that were provided. The decision states that the phrase “actual knowledge” must be given its plain meaning: “[r]eal knowledge as distinguished from presumed knowledge or knowledge imputed to one.”
by Cody AllisonAre Mental Health and Substance Abuse Disorder Benefits Available Under ERISA?
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
The question arises whether mental health befits and substance abuse disorder benefits available under ERISA. The answer lies in how the individual long-term disability plan is written.
In the case of Wit v. United Behavioral Health (No. 14-CV-02346 [and the related case No. 14-CV-05337-JCS]), the U.S. District Court in the Northern District of California ruled that if a company has a plan that allows for these type of benefits, the plan administrator may not abuse its discretion by adopting guidelines for the plan that:
Allows a conflict of interest in an attempt to keep expenses down and increase revenues into the plan;
Allows financial considerations to influence the development of the guidelines and not shielding the individuals who develop these guidelines;
Refuses to adopt generally accepted clinical guidelines despite the recommendations from clinicians to do so and against some states’ requirements stipulating standards of care.
The Court notes that a key issue raised in the case is the coverage for behavioral and substance use disorders as chronic, rather than acute conditions. The Plaintiffs argued that this distinction allowed for a termination of benefits once the conditions subsided and did not allow for long-term services needed to stabilize the condition.
by Cody AllisonERISA and Covid 19
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
Foremost on many Americans’ minds at this time is how the COVID 19 virus is going to affect their lives. Being a firm that handles ERISA cases, we have been curious as to how the virus will affect long term and short term disability plans.
On April 28, 2020, the U.S. Department of Labor released a set of FAQs designed to answer some of the most common and pressing questions about the relationship between the virus and ERISA plans, including health benefit and retirement benefit FAQs. Below, we have included a link to these FAQs.
Remember, if you have questions about your plan, call us. We can help!
by Cody AllisonChronic Fatigue Syndrome, Fibromyalgia and ERISA: Cochran v. Reliance Standard Life Insurance Co.
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
We often get questions about the whether or not claims can be successfully made for fibromyalgia and/or Chronic Fatigue Syndrome. This question was recently addressed in the case of Cochran v. Reliance Standard Life Insurance Company, et al, a case from the U.S. District Court for the Central District of California.
In this case, the Plaintiff appealed the denial of his disability benefits. The Plaintiff claimed that he was disabled based on having Chronic Fatigue Syndrome (CFS) and fibromyalgia. In the Findings of Fact and Conclusions of Law section of the opinion, the Court examined the relevant plan provisions and made an extensive examination of the medical history. The Court noted abnormal results of pulmonary testing and the diagnosis of possible CFS.
The Court further notes that the examining agency for the Defendant insurance company found that, while some weakness may have been found, most of the tests were within normal parameters. The insurance company’s report also heavily implied that the Plaintiff was merely malingering.
The Plaintiff than had a psychological evaluation where the doctor found that the Plaintiff was preoccupied with his medical condition, but could not say for certain that he as malingering.
Later medical reports show that the Plaintiff was improving and that his condition was somewhat managed with medication.
The Court examines all the proof and decides that the claimant must not be required to prove a subjective complaint (unmeasurable or not subject to proof by medical test or scan) by objective evidence, when the diseases in question — here CFS and fibromyalgia — are not objectively provable. The Court finds that forcing objective proof when it cannot exist is an abuse of discretion, as well as arbitrary and capricious. The Court found that the IME doctors on behalf of the insurance company had done just this. The doctors basically disregarded the Plaintiff’s subjective complaints and tried to make objective observations which is not possible for these types of conditions.
For these reasons, the Court reversed the insurance company’s decision and found the Plaintiff to be “totally disabled” under the terms of the plan.
by Cody AllisonERISA and Mental Health Coverage
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
In the recent case of Emch v. Community Insurance Company d/b/a Anthem Blue Cross and Blue Shield, No. 1:17-CV-00856, 2019 WL 5538196 (S.D. Ohio Oct. 25, 2019), the plaintiff filed a putative class action alleging that an employer-sponsored health insurance plan improperly denied claims for residential mental health services for the plaintiff’s minor son. Notably, the plaintiff alleged that Ohio Rev. Code § 3923.281 (the Ohio Parity Act), a mental health parity statute in Ohio state law, was incorporated into the terms of the plan through a “Conformity with Law” clause, empowering him to seek relief through ERISA for alleged violations of the Ohio Parity Act.
The court denied the defendant’s motion to dismiss the complaint, holding that the plaintiff had stated plausible claims for relief under 29 U.S.C. § 1132(a)(1)(B) and 29 U.S.C. § 1132(a)(3) because the plan incorporated the Ohio Parity Act’s requirement that plans cover the “diagnosis and treatment of biologically based mental illnesses on the same terms and conditions as, and … provide benefits no less extensive than, those provided under the policy of sickness and accident insurance for the treatment and diagnosis of all other physical diseases and disorders ….” Ohio Rev. Code § 3923.281(B); see Emch, 2019 WL 5538196, at *3.
The court analyzed two prior district court cases where plaintiffs had argued that state mental health parity laws were incorporated into their plans: Bushell v. Unitedhealth Group, Inc., No. 17-CV-2021, 2018 WL 1578167 (S.D.N.Y. Mar. 27, 2018), and A.F. ex rel. Legaard v. Providence Health Plan, 35 F. Supp. 3d 1298 (D. Or. 2014). The defense urged the court to follow the reasoning in Bushell that rejected a similar claim and cautioned that it would improperly expand the scope of relief available under ERISA. See Bushell, 2018 WL 1578167 at *4 (holding that the plaintiff “cannot enforce” a New York mental health parity law “under the guise of an ERISA claim” and noting that a contrary conclusion “would mean that this one provision allows suit for violation of any state or federal law”). But the court followed the reasoning in Legaard that a plaintiff has standing to enforce provisions of state statutes incorporated into her plan through ERISA. See Legaard, 35 F. Supp. 3d at 1305 (holding that plaintiff had stated a cause of action under 29 U.S.C. § 1132(a)(3) for violation of the Oregon mental health parity statute, and that “ERISA provides courts with the power to enjoin violations of state law regulating insurance that have become part of the terms of the plan”). The Emch litigation continues following the court’s denial of the motion to dismiss. This case is discussed at this link: https://www.jdsupra.com/legalnews/recent-decisions-addressing-mental-69640/
by Cody AllisonJohnson v. General Electric Company, (9th Circuit May 21, 2019) No. 18-35581
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
In this case, the Court reviewed and found that the lower court did not err in finding that the claimant did not establish her further entitlement to long term disability payments under the plan terms. The Court found that she was entitled to payments based on her “normal straight-time annual earnings” but was not entitled to payments based on commissions, other variable compensation or special or supplemental payments, unless the Pension Board at General Electric determined that normal straight-time earnings also includes this income. The Court found that the Board had not made such a determination.
Notably, the Court found that the lower court did not err in allowing in extrinsic evidence — statements of GE and MetLife employees — because, when the de novo review applies, the court must exercise its discretion to consider new evidence in order to get the full picture to exercise its informed judgment.
by Cody AllisonExhaustion of Administrative Remedies under ERISA
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
Fortier v. Hartford Life & Accident Ins. Co., 916 F.3d 74 2019 EB Cases 55547 (1st Cir. 2019) (exhaustion of administrative remedies).
Fortier received long-term disability (LTD) benefits under a group disability plan insured by Hartford Life & Accident Insurance Company (“the Plan”). The Plan only pays 24 months of benefits for disabilities caused by mental illnesses. Hartford approved and paid Fortier’s LTD benefits before sending her notice on September 13, 2011 that her benefits would terminate in the future on November 1, 2011 due to the Plan’s Mental Illness Limitation. The letter informed Fortier of her right to appeal within 180 days of the date that she received the letter. Fortier retained an attorney who submitted a timely appeal and was able to get her benefits reinstated. Shortly after reinstating her claim, Hartford explained that since it did not give Fortier prior notice of the application of the Mental Illness Limitation, it was starting the 24-month period as of September 13, 2011 and no benefits will be payable beyond September 12, 2013.
After completing an investigation and review of Fortier’s claim, Hartford notified Fortier’s attorney by letter dated July 17, 2013 that it would stop paying benefits on September 13, 2013 because it had determined that the Mental Illness Limitation applied to the claim. The letter also notified Fortier of her right to appeal within 180 days of receipt of the letter. Fortier did not appeal within 180 days but sent in a letter purporting to appeal two months after Hartford’s stated deadline. Hartford declined to consider the appeal because it was untimely.
The First Circuit rejected the plaintiff’s argument that the 180-day period should run from the date of the termination of benefits and not from the date of the July 17, 2013 notice of the adverse decision. It held that the 180-day time limit to appeal an adverse benefit determination began to run from the date of the notice of the determination. The court also found that Hartford followed the terms of the Plan, which were consistent with ERISA’s requirements, when it provided her notice of the benefit determination and her right to appeal within 180 days.
Although the doctrine of “substantial compliance” has been applied to excuse an insurer’sfailure to comply with ERISA’s notice requirements, it does not apply to late appeals by claimants. The court agreed with the Seventh Circuit’s decision in Edwards v. Briggs & Stratton Ret. Plan, 639 F.3d 355 (7th Cir. 2011), which reasoned that applying the doctrine to the exhaustion requirement “would render it effectively impossible for plan administrators to fix and enforce administrative deadlines while involving courts incessantly in detailed, case-by-case determinations as to whether a given claimant’s failure to bring a timely appeal from a denial of benefits should be excused or not.” Id. at 362. The court also explained that nothing in the ERISA regulations is undermined by insurers applying deadlines strictly against plan participants.
Lastly, like the Seventh and Ninth Circuits, which have considered this issue, the court held that New Hampshire’s common law notice-prejudice rule does not apply to ERISA appeals: “[t]he exhaustion requirement — and several of its underlying policy goals — would be undercut by an extension of a state law notice-prejudice rule to ERISA appeals.”
by Cody AllisonHow does the SECURE Act Impact Retirement Plans?
On December 20, 2019, the SECURE Act became law. SECURE stands for “Setting Every Community Up for Retirement Enhancement.” It has impacted ERISA plans. Mostly, this Act will affect the employers’ and plan providers’ side of the ERISA plan. However, you will want to be aware that you may be getting information from your plan provider soon which will make changes to your plan. These changes are required by SECURE.
Below is a link to an article which lists the major areas of change that will be coming to your ERISA plan. Review this list and make sure that what your provider is doing under SECURE is what is mandated. Remember, if you have difficulty with your plan, contact us — we are here to help.
If you believe you have been wrongfully denied your ERISA, or non-ERISA, long-term disability benefits, give us a call for a free lawyer consultation. You can reach Cody Allison & Associates, PLLC at (615) 234-6000, or toll free (844) LTD-CODY. We are based in Nashville, Tennessee; however, we represent clients in many states (TN, KY, GA, AL, MS, AR, NC, SC, FL, MI, OH, MO, LA, VA, WV, just to name a few). We will be happy to talk to you no matter where you live. You can also e-mail our office at cody@codyallison.com. Put our experience to work for you. For more information go to www.LTDanswers.com
https://www.natlawreview.com/article/secure-act-and-its-impact-retirement-plans