Debbie McCravy v. Metropolitan Life Insurance Co
690 F.3d 176
| 4th Cir. | 2012Background
- McCravy, a Bank of America employee, participated in a MetLife life insurance/AD&D plan and paid premiums for her daughter Leslie.
- Leslie was 25 at death in 2007, and MetLife denied coverage under the 'eligible dependent children' criterion as she was over 19.
- McCravy sued in 2008 claiming MetLife misrepresented coverage and breached fiduciary duties under ERISA, seeking relief under 1132(a)(2) or (a)(3) and state-law claims.
- District court held state-law claims preempted, and allowed recovery under 1132(a)(3) only for premiums wrongfully withheld.
- Amara (2011) clarified that 1132(a)(3) permits equitable remedies such as surcharge and estoppel, expanding available remedies.
- On appeal, the Fourth Circuit reversed, concluding surcharge and equitable estoppel are available under 1132(a)(3) and remanded for proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 1132(a)(3) allows surcharge. | McCravy seeks make-whole relief via surcharge for losses. | MetLife argues 1132(a)(3) only permits premiums refunds. | Yes; surcharge is available under 1132(a)(3). |
| Whether 1132(a)(3) permits equitable estoppel. | McCravy contends estoppel prevents denial of conversion rights and protects expectations. | MetLife contends estoppel not applicable under 1132(a)(3). | Yes; equitable estoppel is available under 1132(a)(3). |
| Whether district court erred by limiting damages to premiums. | Amara expanded remedies beyond premium refunds. | Law should limit remedies to premium refunds. | District court erred; remand for full 1132(a)(3) considerations. |
Key Cases Cited
- CIGNA Corp. v. Amara, 131 S. Ct. 1866 (2011) (expanded 1132(a)(3) remedies to include surcharge and equitable relief)
- Coleman v. Nationwide Life Ins. Co., 969 F.2d 54 (4th Cir. 1992) (equitable estoppel limited where premiums not paid)
- LaRue v. DeWolff, Boberg & Assocs., Inc., 450 F.3d 570 (4th Cir. 2006) (pre-Amara interpretation of 1132(a)(3) remedies)
- Amara v. Cigna Corp., 131 S. Ct. 1866 (2011) (regarded as the controlling guidance on 1132(a)(3) remedies)
- United States v. Fareed, 296 F.3d 243 (4th Cir. 2002) (binding consideration on reliance on Supreme Court dicta)