Roche v. Aetna, Inc.
167 F. Supp. 3d 700
D.N.J.2016Background
- Plaintiffs Jay Minerley (NJ) and Tim Singleton (PA) were automobile-accident victims who received health-insurance payments from Aetna plans and faced demands for reimbursement/subrogation by Rawlings.
- Plaintiffs sued Aetna entities and Rawlings in New Jersey state court alleging violations of NJ anti-subrogation law (N.J.S.A. 2A:15-97), N.J.A.C. 11:4-42.10, the NJ Consumer Fraud Act, and common-law torts; case was removed to federal court on ERISA grounds.
- Disputes exist about which written plan(s) covered Minerley (competing New Jersey vs. Pennsylvania plan documents) and whether Singleton was covered by a second Hundley plan in addition to the HLM plan.
- Third-Party letters from Rawlings prompted Minerley to pay a reimbursement amount; Singleton did not pay. Plaintiffs seek class relief and individual damages.
- Court treated Plaintiffs’ state-law claims as preempted/convertible to ERISA § 502(a) claims where appropriate; only Minerley was granted leave to replead under ERISA § 502(a); Singleton’s claims were dismissed without prejudice for failure to exhaust administrative remedies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether NJ anti-subrogation statute (NJCSS) and NJAC § 42.10 claims survive removal / are preempted by ERISA | Plaintiffs conceded NJCSS is preempted but argued NJAC § 42.10 is saved as a law "regulating insurance" and therefore survives | Defendants argued ERISA preempts the state-law claims and Section 42.10 should not supply relief beyond ERISA | Court: NJCSS claims are preempted; Section 42.10 is saved from express preemption under ERISA § 514(b)(2)(A) and may supply the rule of decision for an ERISA § 502(a) benefits claim but cannot be litigated as an independent state-law claim |
| Whether claims for recovery/avoidance of subrogation are "benefits due" under ERISA § 502(a) (i.e., complete preemption) | Plaintiffs argued such claims can be federal ERISA claims under Third Circuit precedent | Defendants argued state-law remedies should not be converted to ERISA remedies | Court: Follows Third Circuit (Levine/Wirth) — such claims are for "benefits due" and thus preempted/convertible to ERISA § 502(a) claims |
| Whether Minerley may replead as an ERISA § 502(a) plaintiff (futility defenses: wrong parties, plan terms, exhaustion, voluntary payment doctrine) | Minerley sought leave to amend; argued voluntary payment was coerced by Rawlings letters | Defendants argued amendment would be futile because of plan language, wrong defendants, failure to exhaust, and voluntary payment bar | Court: Denied futility on plan/standing/exhaustion grounds because disputed plan coverage creates material facts; rejected voluntary payment defense — Minerley may amend within 30 days |
| Whether Singleton may replead as ERISA § 502(a) plaintiff | Singleton argued he need not exhaust administrative remedies and that exhaustion would be futile | Defendants argued required administrative exhaustion under plan terms and Third Circuit law | Court: Granted dismissal without prejudice as to Singleton for failure to exhaust; exhaustion not excused on futility grounds |
Key Cases Cited
- Perreira v. Rediger, 778 A.2d 429 (N.J. 2001) (NJ Supreme Court held collateral-source statute bars insurer subrogation/reimbursement)
- Levine v. United Healthcare Corp., 402 F.3d 156 (3d Cir. 2005) (Third Circuit: NJ collateral-source claims preempted by ERISA for ERISA-covered plans; claims to avoid subrogation are ERISA § 502(a) benefits claims)
- Aetna Health Inc. v. Davila, 542 U.S. 200 (U.S. 2004) (ERISA preemption/savings clause analysis; state law that provides alternate remedy is preempted)
- UNUM Life Ins. Co. of Am. v. Ward, 526 U.S. 358 (U.S. 1999) (saved state insurance laws may supply rule of decision for ERISA § 502(a) suits if they do not provide extra relief)
- Wirth v. Aetna U.S. Healthcare, 469 F.3d 305 (3d Cir. 2006) (reaffirms Levine: claims to recover subrogation payments are ERISA benefits claims)