Jerry Higgins v. Lincoln Electric Co.
23-5862
| 6th Cir. | Jan 16, 2025Background
- Jerry Higgins was an employee of Lincoln Electric Co. and participated in their long-term disability (LTD) benefits plan.
- Lincoln provided Higgins with a Benefit Election Form stating he would receive $92,260.80 annually in LTD benefits.
- However, the official LTD plan documents clearly capped benefits at $60,000 per year.
- Higgins claimed he relied on the higher amount in the form and did not purchase supplementary disability coverage.
- After becoming disabled, Higgins applied for benefits and was informed of the actual (lower) cap.
- Higgins sued Lincoln under ERISA for estoppel, asserting he should receive the higher benefits shown in the form; the district court dismissed his claim for failure to meet the heightened pleading standard.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether estoppel can override unambiguous terms | Plan ambiguous or lower standard applies; met elements even if heightened standard used | Plan terms unambiguously cap benefits; heightened standard applies, not met | Heightened estoppel standard applies; plaintiff failed multiple elements |
| Whether factual allegations suffice for estoppel | Sufficient allegations for estoppel | Plaintiff failed to plausibly plead required estoppel elements | Plaintiff failed to plausibly plead multiple elements |
| Whether reliance on the Benefit Election Form was reasonable | Higgins justifiably relied on form | Plaintiff had access to clear plan documents; reliance unreasonable | Reliance on the form unreasonable as a matter of law |
| Whether the case should be dismissed on the merits | Claim should survive dismissal | Claim fails on merits regardless of limitations issue | Affirmed dismissal; claim fails on merits; limitations not reached |
Key Cases Cited
- US Airways, Inc. v. McCutchen, 569 U.S. 88 (ERISA requires enforcement of unambiguous plan terms as written)
- Sprague v. Gen. Motors Corp., 133 F.3d 388 (5th Cir. 1998) (recognizes five-element ERISA-estoppel standard and primacy of plan documents)
- Crosby v. Rohm & Haas Co., 480 F.3d 423 (6th Cir. 2007) (benefit statements outside plan documents cannot modify unambiguous plan terms)
- Bloemker v. Laborers' Loc. 265 Pension Fund, 605 F.3d 436 (6th Cir. 2010) (sets forth heightened eight-element ERISA-estoppel standard for unambiguous plans)
- Zirbel v. Ford Motor Co., 980 F.3d 520 (6th Cir. 2020) (requiring intent or gross negligence for constructive fraud in ERISA-estoppel)
- Pearce v. Chrysler Grp. LLC Pension Plan, 893 F.3d 339 (6th Cir. 2018) (written misrepresentation must prevent calculation of benefits for estoppel)