Deborah Kenseth v. Dean Health Plan, Incorporated
722 F.3d 869
7th Cir.2013Background
- Kenseth sued Dean Health Plan for breach of fiduciary duty under ERISA and Wisconsin law after reliance on Dean’s oral coverage representations for a Roux-en-Y procedure; plan documents were ambiguous about coverage for complications and lacked a binding pre-approval process; Kenseth underwent surgery in 2005, was denied coverage, and incurred substantial bills; district court granted Dean summary judgment; this court remanded after Kenseth I to consider equitable relief under 29 U.S.C. § 1132(a)(3) in light of CIGNA v. Amara; on remand Kenseth sought make-whole relief and various affirmative relief measures; the district court again ruled Kenseth could not obtain relief as a matter of law, and Kenseth appealed; after CIGNA, the question became whether monetary make-whole relief can be equitable under § 1132(a)(3) and what form relief should take on remand; Kenseth contends she is a plan participant and may seek injunctive relief and attorneys’ fees; Dean defends that Kenseth lacks standing and that monetary relief is not equitable under the statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether CIGNA allows monetary make-whole relief under §1132(a)(3). | CIGNA expands equitable relief to include money damages. | Monetary relief is not automatically equitable; relief must be appropriate and limited. | Remand to decide if make-whole relief is appropriate may be required. |
| Whether Kenseth may obtain make-whole relief for a breach of fiduciary duty. | Kenseth seeks make-whole relief due to informational breach. | Relief must be determined as appropriate equitable relief and may be limited. | The court remands to determine breach and appropriate relief. |
| Whether Kenseth has standing to seek prospective injunctive relief. | Kenseth remained a plan participant at injury time and later rejoined; injury ongoing. | Standing mooted when Kenseth ceased plan participation. | Remand to assess whether Kenseth’s new status revived claims for prospective relief. |
| Whether Kenseth is entitled to summary judgment on liability for breach of fiduciary duty. | Evidence shows Dean misled and failed to warn; duty to disclose remains. | Ambiguities and non-binding statements limit liability. | Partial summary judgment is inappropriate at this stage; trial required to decide breach and harm. |
| What form of equitable relief, if any, should be awarded on remand. | Make-whole relief or alternative equitable remedies are appropriate. | Relief must fit §1132(a)(3) and be properly framed; not all relief would be appropriate. | District court to fashion relief consistent with CIGNA and Kenseth’s facts on remand. |
Key Cases Cited
- CIGNA Corp. v. Amara, 131 S. Ct. 1866 (2011) (expanded §1132(a)(3) relief to include some monetary remedies; clarified harm standard)
- Mertens v. Hewitt Assocs., 508 U.S. 247 (1993) (defined ‘appropriate equitable relief’ under pre-merger law; guided later interpretations)
- Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204 (2002) (money sought not always equitable; distinction between legal and equitable relief in ERISA)
- Gearlds v. Entergy Servs., Inc., 709 F.3d 448 (5th Cir. 2013) (surcharge as potential equitable remedy under §1132(a)(3) after CIGNA)
- McCravy v. Metropolitan Life Ins. Co., 690 F.3d 176 (4th Cir. 2012) (after CIGNA, surcharge/equitable relief possible for fiduciaries)