Merigan v. Liberty Life Assurance Co.
826 F. Supp. 2d 388
D. Mass.2011Background
- Merigan, a former UHS employee, seeks ERISA benefits under Liberty's LTD policy in a case removed to the District of Massachusetts.
- Count I seeks LTD benefits; Count II seeks attorney's fees and costs under 29 U.S.C. § 1132(g).
- Liberty paid LTD Benefits February 2004–February 2006; benefits ceased March 14, 2006, with a termination notice and a 180-day appeal window referenced in the SPD/termination letter.
- SPD and the Policy are separatedocuments; UHS delivered SPDs to employees, but there is no signed acknowledgment or proof Merigan received an SPD.
- Merigan argued the 180-day deadline was not a mandatory term in the Plan and therefore not enforceable; Liberty argued the deadline was binding.
- The court held that Liberty’s untimely rejection of Merigan’s appeal was incorrect as a matter of law and reserved issues on remedies and attorney’s fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 180-day appeal deadline binds Merigan | SPD terms not part of the Plan; no mandatory deadline in the Policy. | Appeal deadline stated in SPD/termination letter governs review. | SPD not binding as plan terms; appeal not properly time-barred |
| Whether SPDs are part of the ERISA plan for purposes of review | SPD terms do not become plan terms; Amara controls. | SPD may govern review procedures under the Plan. | Plan terms control; SPD not part of the Plan per Amara |
| Whether Liberty’s denial of benefits after deemed untimely review precludes relief or affects remedies | Because the Plan did not incorporate a time limit, the appeal should be reviewed on merits. | Untimeliness bars review and limits relief. | Merigan entitled to review on merits; remedies and fees to be determined at hearing |
| Whether attorneys’ fees should be awarded under § 1132(g)(1) | Hardt allows fee-shifting where merits are achieved; fees may be awarded. | Fees depend on outcome and Cottrill factors; no prevailing party here yet. | Remanded for argument on remedies and fee award per Hardt and related authorities |
Key Cases Cited
- Cigna Corp. v. Amara, 131 S. Ct. 1866 (2011) (SPD not part of the terms of the Plan; summaries communicate but do not set plan terms)
- Hardt v. Reliance Standard Life Ins. Co., 130 S. Ct. 2149 (2010) (eligibility for attorney’s fees does not require prevailing party; focus on meaningful benefit)
- Gastronomical Workers Union Local 610 & Metropolitan Hotel Ass'n Pension Fund v. Dorado Beach Hotel Corp., 617 F.3d 54 (1st Cir. 2010) (five Cottrill factors for fee awards; recognize meaningful benefit standard)
- Sullivan v. CUNA Mut. Ins. Soc., 649 F.3d 553 (7th Cir. 2011) (addressed Amara implications for plan vs SPD terms and plan discretion)