Withrow v. Bache Halsey Stuart Shield, Inc.
2011 U.S. App. LEXIS 17526
| 9th Cir. | 2011Background
- Withrow is a plan participant in a long-term disability program funded by Reliance; the plan is insured by Reliance Standard Life Insurance.
- She has been totally disabled since December 6, 1986, with ongoing claims for disability benefits dating back to 1987.
- Reliance calculated her monthly benefits as $3,950 instead of $5,000; she questioned the calculation starting in 1987 and again in 1990.
- Her 1990 communications did not specify a deadline for response, and Reliance’s response was unclear; no final denial or written decision followed.
- From 1990 to 2002, Withrow repeatedly sought review and an audit of the benefits calculation; Reliance continued to deny the miscalculation.
- In January 2004, Reliance informed her attorney by phone that the appeal was denied; Withrow filed suit under ERISA on February 16, 2006; the district court dismissed as untimely.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| ERISA accrual date for benefits claims | Withrow argues accrual occurred when she learned of miscalculation in 1990 | Bache Halsey argues accrual happened in 1990 when denial was communicated | Accrual occurred on January 14, 2004 (actual denial) under ERISA |
| Whether contract limitations apply to miscalculation disputes | Plaintiff contends contract-based limits apply | Defendant contends contract limits apply to miscalculation | Contractual limitations do not apply to miscalculation disputes; ERISA four-year clock governs |
Key Cases Cited
- Wetzel v. Lou Ehlers Cadillac Group Long Term Disability Ins. Program, 222 F.3d 643 (9th Cir. 2000) (ERISA accrual and application of state limitations)
- Chuck v. Hewlett Packard Co., 455 F.3d 1026 (9th Cir. 2006) (unusual circumstances required for time-barred claims despite inadequate notice)
- Nikaido v. Centennial Life Ins. Co., 42 F.3d 557 (9th Cir. 1994) (overruled on contract-limits interpretation; not controlling now)
- Wise v. Verizon Commc'ns, Inc., 600 F.3d 1180 (9th Cir. 2010) (accrual when claimant has reason to know of denial)
- LaMantia v. Voluntary Plan Adm'rs, Inc., 401 F.3d 1114 (9th Cir. 2005) (ERISA accrual and limitations)
- Martin v. Constr. Laborer's Pension Trust for S. Cal., 947 F.2d 1381 (9th Cir. 1991) (reason-to-know standard for accrual)