Todd Rochow v. Life Ins. Co. of North America
780 F.3d 364
| 6th Cir. | 2015Background
- Rochow (deceased 2008) claimed long-term disability benefits under LINA policy LK 30214 and was denied benefits in 2002-2004.
- District court ruled LINA acted arbitrarily and capriciously in denying benefits; Rochow I affirmed.
- Rochow’s estate pursued disgorgement of profits for LINA’s alleged fiduciary breach; district court awarded disgorgement in Rochow II.
- En banc review vacated the disgorgement award and remanded to consider prejudgment interest under § 502(a)(1)(B).
- Majority holds Rochow cannot obtain disgorgement under § 502(a)(3) where § 502(a)(1)(B) remedy is adequate, but remands for prejudgment interest determination if appropriate.
- Concurrences explore procedural history and potential remaining avenues for equitable relief or interest on remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rochow may recover under both § 502(a)(1)(B) and § 502(a)(3) for the same injury. | Rochow seeks dual remedies for two distinct injuries (benefits denial and fiduciary breach). | If adequate relief under § 502(a)(1)(B) exists, § 502(a)(3) relief is duplicative and improper. | Disgorgement under § 502(a)(3) vacated; dual remedies allowed only if necessary to make whole, with remand for prejudgment interest. |
| Whether disgorgement of profits is appropriate when § 502(a)(1)(B) remedies are adequate. | Disgorgement is necessary to address LINA’s unjust enrichment from delaying benefits. | Disgorgement is duplicative where make-whole relief already provided. | Disgorgement award vacated; not appropriate where § 502(a)(1)(B) remedy suffices, absent showing inadequacy. |
| Does Varity/Amara framework permit § 502(a)(3) relief in this case? | Varity and Amara support dual relief to make claimants whole when inadequate relief elsewhere. | Varity cautions against relief not necessary to make whole; Amara clarifies available equitable remedies. | Majority follows Varity/Amara to restrict § 502(a)(3) relief absent inadequacy of § 502(a)(1)(B). |
| Should prejudgment interest be available on remand, and at what rate? | Prejudgment interest could make Rochow whole for delay. | Prejudgment interest may be awarded in discretion but not at punitive rates; rate must be compensatory. | Remand to district court to determine whether prejudgment interest is warranted and at what rate. |
Key Cases Cited
- Varity Corp. v. Howe, 516 U.S. 489 (U.S. 1996) (safety-net remedy; adequacy of relief governs whether § 502(a)(3) relief is appropriate)
- Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609 (6th Cir. 1998) (no § 502(a)(3) relief where § 502(a)(1)(B) remedy adequate for the injury)
- Hill v. Blue Cross and Blue Shield of Michigan, 409 F.3d 710 (6th Cir. 2005) (plan-wide injury vs. individual denial; injunctive relief may be appropriate under § 502(a)(3) beyond benefits)
- Amara v. Cigna Corp., 131 S. Ct. 1866 (S. Ct. 2011) (expands understanding of § 502(a)(3); equitable relief includes traditionally equitable remedies like surcharge)
- Edmonson v. Lincoln Nat’l Life Ins. Co., 725 F.3d 406 (3d Cir. 2013) (standing and interplay of remedies; limited relevance to this case’s § 502(a)(3) interplay)
- Gore v. El Paso Energy Corp. Long Term Disability Plan, 477 F.3d 833 (6th Cir. 2007) (reaffirms that § 502(a)(3) relief may be available where inadequate § 502(a)(1)(B) relief)