D'Iorio v. Winebow, Inc.
920 F. Supp. 2d 313
E.D.N.Y2013Background
- Plaintiff Janet D’lorio sues Winebow, Inc. under ERISA seeking statutory, injunctive, and equitable relief for alleged fiduciary breaches related to long-term disability and life insurance benefits.
- Plaintiff alleges the plan misrepresented benefits and failed to disclose plan documents or summaries.
- Defendant moved to dismiss under Rule 12(b)(6); motion was granted in part and denied in part.
- Dec 2008 PowerPoint described benefits under a UNUM plan effective Jan 1, 2009, with benefits allegedly based on 66 2/3% of monthly earnings up to specified caps and allegedly paid at no cost to employees.
- Plaintiff did not receive a copy of the required summary plan description within 90 days of becoming a participant, and later disputes arose over how earnings were defined for benefit calculations.
- Plaintiff ultimately received an approved long-term disability claim in Nov. 2010, with post-approval information raising questions about calculations and deductions (e.g., Social Security benefits).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 502(c)(1) claim for information disclosure is viable | D’lorio sought written plan information; oral requests allegedly insufficient | Requests were not written as required by § 1024(b)(4) | Claim dismissed under § 502(c)(1) |
| Whether § 502(a)(3) claim is viable for breach of fiduciary duty | Seeks monetary relief for breach as a surcharge/corrective remedy | Knudson/Knudson-like rule bars monetary relief under § 502(a)(3) except in limited cases | Survival of § 502(a)(3) claim; monetary relief viable as surcharge; estoppel/reformation rejected |
| Whether violations of ERISA § 104(b)(1)(A) (failure to furnish SPD) support § 502(a)(3) claim | Failure to provide SPD constitutes breach of fiduciary duty | Complaint inadequately linked to fiduciary breach | Plaintiff stated § 502(a)(3) breach based on § 104(b)(1)(A) |
| Whether misrepresentations and ERISA § 102 violations support § 502(a)(3) claim | PowerPoint misrepresents plan terms and harms plaintiff; written materials may be deemed misrepresentation | Statements not sufficiently tied to plan terms or breach | Sufficient to state breach of fiduciary duty based on misrepresentation/ERISA § 102 |
| Whether, due to SPD issues, deduction of Social Security benefits from LTD would support relief | Defendant’s failure to provide SPD and reliance on PowerPoint harmed plaintiff; deduction questioned | Deduction provision in SPD would govern; need not find diversion absent SPD | Premature to dismiss; surcharge theory supports potential breach due to lack of SPD |
Key Cases Cited
- Twombly v. Bell Atl. Corp., 550 U.S. 544 (U.S. 2007) (plausibility pleading standard for Rule 12(b)(6))
- Ashcroft v. Iqbal, 129 S. Ct. 1937 (U.S. 2009) (threadbare legal conclusions not accepted as facts; plausibility required)
- Knudson, 534 U.S. 204 (U.S. 2002) (limits on monetary relief under 502(a)(3); restitution context)
- Pereira v. Farace, 413 F.3d 330 (2d Cir. 2005) (Knudson reasoning applied to ERISA § 502(a)(3) restitution/surcharge)
- Coan v. Kaufman, 456 F.3d 252 (2d Cir. 2006) (ERISA § 502(a)(3) requires equitable basis and relief must be traditionally equitable)
- Sereboff v. Mid Atlantic Medical Services, 547 U.S. 356 (U.S. 2006) (equitable relief/Trust-like remedies under 502(a)(3))
- CIGNA Corp. v. Amara, 131 S. Ct. 1866 (U.S. 2011) (monetary relief possible under 502(a)(3) where equitable relief traditionally available; surcharge concept clarified)
- Wilkins v. Mason Tenders Dist. Council Pension Fund, 445 F.3d 572 (2d Cir. 2006) (duty of fiduciaries; allocation of information and duties under ERISA)
- McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184 (2d Cir. 2007) (ERISA information duties; SPD and plan communications)
- Becher v. Long Island Lighting Co., 129 F.3d 268 (2d Cir. 1997) (ERISA informational duties and implications for beneficiaries)