Orr Ex Rel. Orr v. Assurant Employee Benefits
786 F.3d 596
7th Cir.2015Background
- Daniel Orr died in a motorcycle crash in 2012; Danielle and Hailey Orr, as his beneficiaries, sued for ERISA benefits under a group life insurance policy issued by USIC; the policy contains an intoxication exclusion; USIC denied accidental death benefits on December 10, 2012 based on blood alcohol evidence and a medical opinion of impairment; USIC’s denial notice explained the claims review procedure and two-level internal review; Orrs engaged in a sequence of written communications and appeals from February 2013 through May 2013, then filed suit on July 19, 2013 in Illinois federal court; district court held Orrs failed to exhaust administrative remedies prior to suit; USIC removed and the case proceeded to cross-motions for summary judgment; the appellate court affirmed denial of exhaustional relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Orrs exhausted administrative remedies before filing suit | Orrs argue they pursued first and second reviews | USIC contends no written first-level request and incomplete exhaustion | Exhaustion not shown; failed to complete two-review process before suit |
| Whether exhaustion could be excused | Exhaustion should be excused under limited exceptions | No applicable futility/adequacy/access grounds shown | Exhaustion not excused; district court's discretion affirmed |
| Whether district court properly granted summary judgment | Probably favorable to Orrs on exhaustion | Orrs failed to exhaust and cannot proceed | Affirmed summary judgment for USIC on exhaustion grounds |
Key Cases Cited
- Lindemann v. Mobil Oil Corp., 79 F.3d 647 (7th Cir. 1996) (standard for summary judgment in ERISA cases)
- Edwards v. Brigg & Stratton Ret. Plan, 639 F.3d 355 (7th Cir. 2011) (exhaustion decision discretionary; abused if clear error)
- Gallegos v. Mount Sinai Med. Ctr., 210 F.3d 803 (7th Cir. 2000) (exhaustion excused in limited circumstances)
- Schorsch v. Reliance Standard Life Ins. Co., 693 F.3d 734 (7th Cir. 2012) (lack of access or meaningful review procedures; exhaustion not automatic)
- Frey Corp. v. City of Peoria, Ill., 735 F.3d 505 (7th Cir. 2013) (waiver of arguments not raised in district court; appellate review limits)
- Kross v. Western Electric Co., Inc., 701 F.2d 1238 (7th Cir. 1983) (exhaustion determination within court’s discretion)
- Powell v. A.T. & T. Commc’ns, Inc., 938 F.2d 823 (7th Cir. 1991) (exhaustion as prerequisite to suit; court discretion to excuse)