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Stewart v. Hartford Life And Accident Insurance Co.

United States District Court, N.D. Alabama, Southern Division

May 30, 2018

CAROL H. STEWART, Plaintiff,
v.
HARTFORD LIFE & ACCIDENT INSURANCE COMPANY, Defendant.

          MEMORANDUM OPINION

          KARON OWEN BOWDRE CHIEF UNITED STATES DISTRICT JUDGE

         Plaintiff Carol Stewart sues Defendant Hartford Life & Accident Insurance Company based on Hartford's denial of her applications for long term disability benefits and waiver of life insurance premiums, which she contends violates the Employee Retirement Income Security Act of 1974 (“ERISA”). (Doc. 1). She seeks recovery of the long term disability and waiver of premium benefits (“Count One”); damages for breach of fiduciary duty (“Count Two”); and reinstatement of her waiver of premium benefits (“Count Three”).

         Hartford moves to dismiss Count Two. (Doc. 13). Ms. Stewart opposes the motion to dismiss but moves, in the alternative, to amend the complaint. (Doc. 18). The court WILL GRANT the motion to dismiss Count Two because ERISA does not permit a plaintiff to seek equitable relief if the allegations supporting the claim for equitable relief would also support a claim for recovery of benefits. The court WILL DENY AS FUTILE the alternative motion to amend.

         I. BACKGROUND

         Because this motion seeks to dismiss a claim, the court must accept as true the allegations in the complaint and construe them in the light most favorable to the plaintiff. Butler v. Sheriff of Palm Beach Cty., 685 F.3d 1261, 1265 (11th Cir. 2012). Ms. Stewart alleged in her complaint that, from 1983 until March 2013, she worked as an attorney for the law firm Burr & Forman LLP. Burr & Forman provides employees like Ms. Stewart a welfare benefit plan that includes long term disability benefits and life insurance benefits. By 2013, Hartford was administering Burr & Forman's benefits plan.

         In 2007, while working for Burr & Forman, Ms. Stewart was diagnosed with Parkinson's disease. She alleges that, in 2012, she became “totally disabled” as that term is defined by the long term disability policy. In the same year, she applied for two benefits under the plan: (1) long term disability benefits, and (2) waiver of life insurance premium benefits. Hartford denied her application for long term disability benefits. As to Ms. Stewart's application for waiver of life insurance premiums, Hartford initially denied the application, later determined that she was eligible for that benefit, and finally terminated her waiver of premium benefits.

         Ms. Stewart contends that Hartford erroneously denied her application for long term disability benefits and engaged in improper claims procedures in denying her application for, and appeal from the denial of, waiver of premium benefits. She also contends that Hartford breached its fiduciary duties by failing to follow the claims review procedure and by wrongfully denying Ms. Stewart's claim for waiver of premium benefits.

         She asserts three causes of action under ERISA: (1) recovery of benefits, pursuant to ERISA § 502(a)(1)(B) (“Count One”); (2) breach of fiduciary duty, pursuant to ERISA § 502(a)(3) (“Count Two”); and (3) reinstatement of her waiver of premium benefits, pursuant to ERISA § 502(a)(1)(B).[1]

         II. DISCUSSION

         Hartford moves to dismiss Count Two of Ms. Stewart's complaint. (Doc. 13). Ms. Stewart opposes that motion, but requests, in the alternative, that this court grant her leave to amend the complaint. (Doc. 18). The court will address each motion in turn.

         1. Motion to Dismiss Count Two

         Hartford moves to dismiss only Count Two of Ms. Stewart's complaint. (Doc. 13). It contends that Count Two, the claim for breach of fiduciary duty under § 502(a)(3), is a claim for equitable relief that a plaintiff cannot sustain when she can also seek recovery of benefits under § 502(a)(1)(B) based on the same factual allegations.

         This case arises under ERISA, which “protects employee pensions and other benefits . . . by setting forth certain general fiduciary duties applicable to the management of both pension and nonpension benefit plans.” Varity Corp. v. Howe, 516 U.S. 489, 496 (1996). The two paragraphs of ERISA relevant to this case are § 501(a)(1)(B) and § 501(a)(3). Section 501(a)(1)(B) provides that a participant or beneficiary of a plan may bring a civil action “to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. § 1129(a)(1)(B). Section 501(a)(3) provides that a participant, beneficiary, or fiduciary may bring a civil action “to obtain other appropriate equitable relief (i) to redress [violations of any provision of this subchapter or the terms of the plan], or (ii) to enforce any provisions of this subchapter or the terms of the plan.” 29 U.S.C § 1132(a)(3).

         The Supreme Court has explained that § 501(a)(3) is a “catchall” provision that offers “appropriate equitable relief for injuries caused by violations that § 502 does not elsewhere adequately remedy.” Varity, 516 U.S. at 512. The Eleventh Circuit has interpreted Varity to mean that the only question in determining whether a plaintiff may bring a § 502(a)(3) claim for equitable relief is “whether the allegations supporting the Section 502(a)(3) claim [are] also sufficient to state a cause of action ...


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