United States District Court, M.D. Alabama, Northern Division
MEMORANDUM OPINION AND ORDER
M. BORDEN UNITED STATES MAGISTRATE JUDGE
this ERISA case has not yet reached the discovery phase, it
has already devolved into a war of protracted pretrial
motions devoid of any indicia of cooperation among the
parties. Presently, there are seven motions pending before
the court: (1) a motion to dismiss filed by Defendants
ExpressJet Airline, Inc. and ExpressJet Consolidated Welfare
Benefit Plan, which the court converted into a motion for
summary judgment (Docs. 35 & 47); (2) a motion to dismiss
or, in the alternative, to stay the proceedings pending
administrative review filed by Defendants AIG Claims, Inc.
and National Union Fire Insurance Company of Pittsburg, PA,
which the court converted into a motion for summary judgment
(Docs. 36 & 47); (3) a motion for summary judgment filed
by Plaintiffs Lorrie Waters and Derral Keith Waters (Doc.
37); (4) a motion to lift the stay filed by Plaintiffs Lorrie
Waters and Derral Keith Waters (Doc. 59); (5) a motion for
sanctions against Defendants AIG Claims, Inc. and National
Union Fire Insurance Company of Pittsburg, PA and for limited
discovery filed by Plaintiffs Lorrie Waters and Derral Keith
Waters (Doc. 60); (6) a motion for leave to file second
amended complaint filed by Plaintiffs Lorrie Waters and
Derral Keith Waters (Doc. 66); and (7) a motion for hearing
(Doc. 73). With the benefit of the parties' briefing, the
undersigned will resolve each motion below.
Plaintiffs' Motion for Leave to File Second Amended
there is a stay of the Rule 26 deadlines, all discovery, and
briefing on Plaintiffs' motion for summary judgment until
the court resolves Defendants' pending motions for
summary judgment. Doc. 47. Plaintiffs have now filed a motion
for leave to file a second amended complaint, arguing that
the amendments would moot Defendants' pending
summary-judgment motions and that a number of claims arere
due to be added based upon “recent developments after
learning Defendants have violated the Parties'
stipulations and destroyed evidence.” Doc. 66.
Plaintiffs attached a proposed second amended complaint to
their motion. Doc. 66-1. For the reasons that follow,
Plaintiffs' motion for leave to file the proposed second
amended complaint is due to be granted in part and denied in
filed their complaint in this action asserting claims under
ERISA for wrongful denial of the decedent's claims under
the policy and for failure to provide documents in accordance
with ERISA's provisions. At the time Plaintiffs filed
their complaint, they were proceeding under a “deemed
denial” theory of liability, as a final denial decision
had not yet been issued. The operative pleading currently
before the court-Plaintiffs' first amended complaint
(Doc. 24)-is nine pages long and asserts two causes of
actions against the Defendants.
Plaintiffs seek to file a 25-page second amended complaint
that asserts six causes of actions against the Defendants.
Having reviewed the proposed second amended complaint, the
court orders that Plaintiffs' motion for leave to amend
(Doc. 66) is GRANTED to the extent Plaintiffs seek to assert
wrongful denial and failure to provide document claims under
ERISA (Counts I and II), but DENIED as to all other proposed
claims (Counts III through VI).
court concludes that Counts I and II of Plaintiffs'
proposed second amended complaint, which assert claims for
wrongful denial of a claim and failure to provide documents
under ERISA, may proceed. The court understands that, with
respect to Plaintiffs' ERISA claims, the parties dispute
whether they should be allowed to pursue a deemed denial or
fully exhausted theory of liability. The court finds that
Defendants have not met their burden of demonstrating that a
deemed denial theory of liability is futile or prohibited
when a claim also has been “actually denied”;
thus, to the extent Defendants challenge these dual theories
of liability, they may do so in a responsive pleading or
respect to Plaintiffs' proposed state-law claims, the
court finds that these claims should not proceed because they
are futile. To begin, these claims are preempted by ERISA.
Although Plaintiffs do not label their state-law claims, it
appears that they are attempting to assert additional claims
for intentional infliction of emotional distress (Count III),
breach of contract (Count IV), fraud (Count V), and civil
conspiracy (Count VI), all stemming from events and
circumstances surrounding the denial of Plaintiffs' claim
for benefits under the plan. Doc. 66-1. ERISA's
provisions “shall supersede any and all state laws
insofar as they may now or hereafter relate to any employee
benefit plan described in section 1003(a).” 29 U.S.C.
§ 1144(a). “A party's state law claim
‘relates to' an ERISA benefit plan for purposes of
ERISA preemption whenever the alleged conduct at issue is
intertwined with the refusal to pay benefits.”
Garren v. John Hancock Mut. Life Ins. Co., 114 F.3d
186, 187-88 (11th Cir. 1997) (citing Farlow v. Union Ctr.
Life Ins. Co., 874 F.2d 791 (11th Cir. 1989)). Here, all
of Plaintiffs' proposed state-law claims stem from
conduct intertwined with Defendants' denial of a claim
and refusal to pay benefits under the plan. Thus, these
claims are preempted by ERISA and futile for that reason
even if these claims were not preempted by ERISA, the
undersigned would not permit their inclusion in an amended
complaint because they fail to state cognizable claims
supported by the law. First, the proposed second amended
complaint repeatedly asserts factual allegations and causes
of action against “Defendants” without
identifying the specific defendant to which each allegation
is referring. What is more, many of the allegations are
purely speculative and conclusory. Based on these flaws, it
is virtually impossible for each defendant to have sufficient
notice of its purported wrongdoings.
Plaintiffs' state-law claims, at least as pleaded in the
proposed second amended complaint, fail as a matter of law.
The vast majority of the additions to Plaintiffs'
complaint are nothing more than unnecessary recitations of
the procedural history of this case and complaints about
Defendants' and their counsel's behavior during this
litigation. More specifically, Plaintiffs' claim for
outrage is premised on speculation and factual allegations
that are both conclusory and insufficient to state an outrage
claim under Alabama law. Plaintiffs' breach of contract
claim is based on Defendants' alleged breach of a joint
stipulation of dismissal (i.e., the
“contract”) entered by a Louisiana federal court
in a separate but related proceeding. The undersigned is not
aware of the authority under which it might enforce
Defendants' non-compliance with an order entered by
another court in another jurisdiction or how this court could
reduce Defendants' non-compliance with a joint
stipulation of dismissal entered by another court into an
actionable breach of contract. Likewise, Plaintiffs have not
convinced the court that Defendants' actions during this
litigation, which purportedly deprived Plaintiffs of the
benefit of “transparency and an end to unilateral
discovery, ” amount to fraud under Alabama law.
Finally, because civil conspiracy is not an independent cause
of action, the court finds that this claim is futile because,
as explained above, none of the underlying torts on which
this claim is based are separately viable. See Freeman v.
Holyfield, 179 So.3d 101, 106 (Ala. 2015).
for the reasons stated above, it is ORDERED that
Plaintiffs' motion for leave to file a second amended
complaint (Doc. 66) is GRANTED to the extent Plaintiffs seek
to assert claims for wrongful denial of a claim and failure
to provide documents under ERISA (Counts I and II of the
proposed second amended complaint) and DENIED in all other
respects. Plaintiffs' claim for wrongful denial under
ERISA (Count 1 in the proposed second amended complaint)
shall not be asserted against Defendants ExpressJet Airlines,
Inc. Consolidated Welfare Benefit Plan and ExpressJet
Airlines, Inc. Moreover, the amended complaint shall not
refer to “Defendants” collectively; instead,
Plaintiffs shall identify by name each Defendant mentioned or
referenced in each allegation, as appropriate. The amended
complaint also shall specifically label each cause of action
and which Defendants are the subject of that particular cause
of action, and the amended complaint shall not include any
allegations that are unnecessary to the two permitted claims
described above. Plaintiffs shall file a second amended
complaint that complies with the directives of this order no
later than February 7, 2018, and Defendants
shall answer or otherwise respond to Plaintiffs' amended
complaint no later than February 21, 2018.
Plaintiffs' Motion to Lift Stay and for Sanctions and
Plaintiffs have withdrawn their motion for summary judgment,
as discussed below, it is ORDERED that Plaintiffs' motion
to lift the stay (Doc. 59) is DENIED AS MOOT to the extent it
seeks to lift the stay on the briefing of Plaintiffs'
motion for summary judgment and DENIED in all other respects
because Plaintiffs have not demonstrated that lifting the
stay of the Rule 26 deadlines and all discovery is warranted.
Once Plaintiffs file their second amended complaint and
Defendants answer that complaint, the undersigned will
evaluate whether to lift the stay so that discovery may
have requested to withdraw their motion for sanctions against
AIG and National Union. See Doc. 67 at 6. In
accordance with that request, it is ORDERED that
Plaintiffs' motion for sanctions (Doc. 60) is WITHDRAWN.
With respect to Plaintiffs' motion for limited discovery,
that motion (Doc. 60) is DENIED in light of the rulings made
in this opinion and order. In light of the above, the Clerk
of Court is ...