Case Information
*1 Before KING, SOUTHWICK, and HAYNES, Circuit Judges.
LESLIE H. SOUTHWICK, Circuit Judge:
Lindа Singletary purchased life insurance for herself and her husband through her employer, United Parcel Service. Her husband, Timothy Singletary, was an active-duty soldier in the United States Army. He was killed in a weekend motorcycle accident while off base and not on duty. Prudential Insurance Company of America denied his widow’s claim pursuant to an exclusion for active-duty servicemen. Mrs. Singletary brought suit, claiming she had nо notice of the exclusion and that the exclusion is otherwise unenforceable. The district court granted summary judgment for Prudential and UPS.
We AFFIRM.
FACTS AND PROCEDURAL BACKGROUND
Linda Singletary worked for United Parcel Service and participated in the UPS Flexible Benefits Plan (the “Plan”), which provides group life insurance coverage to UPS employees. The carrier of the Plan is Prudential Life Insurance Company of America. Under the Plan, Mrs. Singletary could purchase supplemental dependent life insurance for her “Qualified Dependents.” On August 22, 2012, she purchased $500,000 in dependent insurance for her husband, Timothy Singletary. Under the Plan, however, a “spouse [or] Domestic Partner . . . is not [a] Qualified Dependent while . . . on active duty in the armed forces of any country.”
Timothy Singletary was an active-duty soldier, stationed at Fort Hood in Texas. He had the rаnk of Specialist in the United States Army. On October 21, 2012, Specialist Singletary was killed in a motorcycle accident in Texas. After his death, Mrs. Singletary submitted a life insurance claim for benefits. Prudential investigated her claim. It reviewed the Army Report of Casualty, which indicated that Specialist Singletary was not on duty at the time of his death. Prudential contacted the Army to confirm that the deceased had been аn active-duty soldier. The Army confirmed, explaining the “off duty” notation on the Report of Casualty meant only that Specialist Singletary was not on duty at the time of his accident. Prudential then denied the claim because the deceased was on active duty at the time of his death.
Mrs. Singletary twice appealed to Prudential, making two principal arguments. First, she argued the active-duty exclusion was nоt disclosed to her. She claimed that the only document she received was a Summary Plan Description (“SPD”). The SPD did not list the relevant exclusion. Other documents that did contain the exclusion, such as an “Enrollment Kit” and “Certificate of Coverage,” were not sent to her. Second, she argued the exclusion is otherwise unenforceable because it is contrary to Louisiana law. Prudential denied both aрpeals. She then filed the present suit in federal court, seeking to recover benefits allegedly due to her under the Employee Retirement Income Security Act (“ERISA”). See 29 U.S.C. § 1132(a)(1)(B). She also advanced state law claims. The district court granted summary judgment to UPS and Prudential, holding that Prudential correctly denied the claim pursuant to the exclusion and the exclusion was enforceable. This timely appeal was then filed.
DISCUSSION
We review the district court’s summary judgment ruling de novo , “applying the same standard as the district court.” Haverda v. Hays Cnty. , 723 F.3d 586, 591 (5th Cir. 2013). We address the ERISA claim before turning to the state-law claims.
I. Overview of ERISA
ERISA “permits a person denied benefits under an employee benefit plan
to challenge that denial in federal court.”
Metropolitan Life Ins. Co. v. Glenn
,
554 U.S. 105, 108 (2008). When reviewing a denial of benefits made by an
ERISA plan administrator, the court applies a
de novo
standard of review,
“unless the benefit plan gives the administrator . . . discretionary аuthority to
determine eligibility for benefits or to construe the terms of the plan.”
Firestone Tire & Rubber Co. v. Bruch
,
We generally evaluate an administrator’s decision in a two-step analysis.
See Baker v. Metro. Life Ins. Co.
,
Here, Prudential correctly interpreted the exclusion as barring the сlaim. The Plan indicates that a spouse is not a qualified dependent when the spouse is on active-duty in the armed forces of any country. Moreover, it was not an abuse of discretion for Prudential to interpret the exclusion to apply regardless of whether a spouse was on military duty at the time of an occurrence. The only evidence was that Specialist Singletary was an active- duty soldier, which is a continuous status, 24/7/365, during the period of enlistment. Benefits are not owed because he was not a qualified dependent.
Mrs. Singletary argues that Prudential abused its discretion by enforcing an exclusion of which she was not on notice. She claims that the only document she received was the Summary Plan Description. Prudential admitted in the administrative proceedings below that the SPD did not mention thе exclusion. Even so, under ERISA, the claim Mrs. Singletary has brought requires us simply to interpret the Plan. Because the Plan does not allow benefits for a spouse who was on active military duty, the claim fails.
As all who wrestle with it know, ERISA is complicated. It has at least
six civil enforcement provisions.
See
29 U.S.C. § 1132(a)(1)−(6);
Ingersoll-Rand
Co. v. McClendon
,
One of our sister circuits discussed a related situation in which, for
reasons that arguably were unfair, coverage did not exist.
See Strom v.
Goldman, Sachs & Co.
,
Importantly, to succeed under Section 1132(a)(1)(B), the claimant must show that he or she “qualif[ies] for the benefits provided in that plan.” Id . For this cause of action, courts do not look for equitable or other reasons the insurer should provide benefits not strictly owed under the Plan. That is not to sаy ERISA has no door through which such claims can proceed, but Section 1132(a)(1)(B) is not open to such a claim. We will later discuss two possibly relevant causes of action under ERISA.
In the present case, the Plan states that the beneficiary, Mrs. Singletary, is “eligible to become [an] insured for Dependents Insurance while” she has “a Qualified Dependent.” A “Qualified Dependent” is defined to be, among other things, a “spouse.” A spouse, though, “is not [a] Qualified Dependent while on active duty in the armed forces of any country . . . .” Thus, Section 1132(a)(1)(B) would provide relief had Prudential failed to follow the terms of the Plan, but it does not provide relief from a proper application of those terms.
Mrs. Singletary is not seeking to enforce the Plan. She instead is seeking relief from the provisions of the Plan because of lack of notice of something that she does not dispute is actually in the Plan. She argues that the SPD’s failure to disclose this exclusion violated ERISA, and therefore, Prudential should be estopped from relying on the exclusion. ERISA requires that an insurer’s SPD list “circumstances which may result in disqualification, ineligibility, or denial or loss of benefits . . . .” 29 U.S.C. § 1022(b).
An equitable claim such as this one can be brought, but “failure to comply with ERISA’s SPD requirements cannot be the basis for a [Section 1132](a)(1)(B) benefit claim.” 1 L EE T. P OLK , ERISA P RACTICE AND L ITIGATION § 3:23 (2016). Two other sections, though, are possible bases for the claim. ERISA provides that “a fiduciary with respect to a plan who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries by this subchapter shall be personally liable” for damages resulting from the breach. 29 U.S.C. § 1109(a). On appeal, Mrs. Singletary argues she rеceived no notice of the active-duty exclusion, which would mean that the Plan Administrator failed to comply with the obligation to send her a compliant SPD. Sending a proper SPD is statutorily identified as a duty: in an ERISA section entitled “Duty of disclosure and reporting,” the first obligation listed is to send the SPD with the necessary disclosures to participants and beneficiaries. 29 U.S.C. § 1021(a)(1). [1] Liability for such breaches, the Supremе Court has pointed out, may be imposed under Section “1132(a)(2) – the second of ERISA’s ‘six carefully integrated civil enforcement provisions,’ . . . – [which] allows the Secretary of Labor or any plan beneficiary, participant, or fiduciary to bring a civil action ‘for appropriate relief under section’” 1109. Mertens v. Hewitt Assocs. , 508 U.S. 248, 252−53 (1993) (citation omitted).
Another provision, Section 1132(a)(3), is also a possibility for this claim.
It provides that a participant or beneficiary of a plan may “obtain other
appropriate equitable relief” as a result of “any act or practice which violates
any provision of this subchapter or the terms of the plan . . . .” 29 U.S.C. §
1132(a)(3);
see CIGNA Corp. v. Amara
,
The Eighth Circuit has stressed the difference between bringing a claim for benefits under a plan and bringing a claim for equitable relief: Although his ultimate goal is to continue receiving disability income benefits . . . section [1132](a)(1)(B) authorizes a participant to bring an action to recover benefits . . . under the terms of the plan. Ross is not seeking to obtain benefits under the terms of the Plan. Rather, he is seeking to reform the Plan by obtaining a declaration that the purported [Plan provisions] are void. Section [1132](a)(1)(B) does not authorize such a claim.
Ross v. Rail Car Am. Grp. Disability Income Plan
,
Finally, the Supreme Court has indicated that inadequate notice claims
are equitable claims appropriate for resolution when a claim is brought under
Section 1132(a)(3).
See Amara
,
Applying these holdings, we conclude that Mrs. Singletary’s claim that Prudential should be estopped because it gave her no notice is not cognizable under her pled сause of action. Further, we should not transform a Section 1132(a)(1)(B) suit into a Section 1132(a)(2) or (a)(3) suit. “ERISA . . . expressly authorizes several claims for relief. Several procedural, as well as substantive, aspects of the litigation vary according to the specific claim alleged in the complaint . . . . Following the lead of the Supreme Court . . . courts now look closely at the particular § 502(a) claim for relief being alleged. Courts are extremely reluctant to improvise or alter these forms of action.” Ronald Dean, ERISA Claims for Relief , SN021 ALI-ABA 225, 227 (2008).
We need not resolve whether subsection (a)(2) or (a)(3) is the better fit. The claim could have been brought by referring to both sections. The problem here is that the only source for the claim used by the plaintiff was the inapplicable Section 1132(a)(1)(B).
It also is important to examine everything that occurred in district court addressing the basis of this claim. We start with the point we have been discussing, namely, that the complaint sought to enforce the Plan and not seek equitable relief from it. That focus is shown not only from the citing of only one of the civil enforcement provisions on which to base her claim, but also in the manner in which she articulated the reasons she was entitlеd to relief.
Count I of the initial complaint [4] states that
Mrs. Singletary submitted substantial evidence establishing that although Mr. Singletary was a member of the armed services . . . at the time of his death, he was stationed stateside and was “off duty” . . . . Mr. Singletary, as a result, was a qualified dependent of Mrs. Singletary under the terms and conditions of the Plan. Mrs. Singletary, accordingly, is entitled to an award of . . . life insurance benefits due as a result of the death of her spouse under the tеrms of the Plan. 29 U.S.C. § 1132(a)(1)(B).
Thus, Mrs. Singletary’s argument in the district court was that she was entitled to benefits under the “terms of the Plan” because her husband was not on active duty, making the exclusion inapplicable.
In no district court filing was there a reference to 29 U.S.C. § 1022(a),
the provision outlining what SPDs must contain. In fact, the only mention of
“SPD” or “Summary Plan Description” in any document filed by Mrs.
Singletary in the district court was in her Memorandum in Opposition to
Motions for Summary Judgment. There, she wrote “that the SPD was
silent
as to the military status policy exclusion.” This reference, though, was in the
section dealing with Louisiana law. As she argued, under Louisiana law, the
insurer must show that the “certificate of insurance was delivered or that the
insured otherwise had notice.” Thus, Mrs. Singletary’s mention of the SPD
omission was in the context of whether she “otherwise had notice” for purposеs
of Louisiana law. In summary, Mrs. Singletary’s ERISA argument in the
district court was only that she was entitled to benefits under the plan. It was
not until her brief in the current appeal that she based the unenforceability of
the exclusion on an SPD violation. That is too late.
See LeMaire v. La. Dep’t
of Transp. & Dev.
,
II. State law
Mrs. Singletary makes two arguments that under Louisiana law the exclusion is unenforceable. Her first is that UPS or Prudential was required to deliver to her a certificate of coverage because of the following statute:
Certificates. A provision that the insurer will issue to the policyholder for delivery to the employee , or member, whose life is insured under such policy, an individual certificate setting forth a statement as to the insurance protection to which he is entitled.
L A . S TAT . A NN § 22:942(7). Her second is that an insurance exclusion based purely on military status is illegal. A Louisiana statute provides that:
No policy of group life insurance . . . in this state shall contain any provision which excludes . . . liability for death . . . while the insured has a specified status, except the following . . . : (1) As a result of war declared or undeclared under conditions specified in the policy.
(2) While in the military, naval, or air forces of any country at war, declared or undeclared; or in any ambulance, medical, hоspital, or civilian noncombatant unit serving with such forces, either while serving with or within six months after termination of service in such forces or units.
Id . § 22:943(A)(1)–(2). We do not address whether Louisiana law offers her relief, however, because we determine that state’s law does not apply.
The Plan states that it is governed by Georgia law. “We have not previously addressed how we should decide residual choice of law disputes in the ERISA context. However, we have held that we should apply federal common law choice of law principles when we exercise federal question jurisdiction over a case.” Jimenez v. Sun Life Assurance. Co. of Canada , 486 F. App’x 398, 406 (5th Cir. 2012). At issue in Jimenez was whether Texas or Louisiana law applied to the extent that ERISA did not preempt both. Id . at 405. The plaintiff, Jimenez, advocated for Louisiana law, but the Plan specified Texas law. Id . at 407. We nоted that under federal common law, there are “three possible approaches to resolving this choice of law issue,” but that we did not need to “decide among these competing standards . . . because . . . Jimenez . . . failed to satisfy his burden to establish that we should not enforce the Policy’s choice of law clause under any standard . . . .” Id . at 408.
The same is true in this case. Here, Mrs. Singletary’s only argument for why Louisiana law should apply is that “Louisiana has a strong interest in its citizen insureds receiving requisite written notice,” and that because the defendants have chosen to insure Louisiana citizens, they should be subject to its laws. This very public policy argument was rejected in Jimenez . There, Jimenez argued that a particular section of Louisiana law was the “public policy of the State of Louisiana and is mandatory to all insurance policies which apply to insureds who reside in Louisiana.” Id . at 406. We held this concern insufficient “to void the Policy’s choice of law provision.” Id . at 408. Moreover, unlike in Jimenez where the accident actually occurred in Louisiana involving Louisiana citizens, here the accident occurred in Texas. [5] See id . Hence, Mrs. Singletary has not provided sufficient argument that the forum selection clause in the Plan should be void.
Mrs. Singletary argues that she should still prevail under Georgia law.
She points out that Georgia law has a similar provision requiring that the
insurer “show that the certificate of insurance was delivered or that the
insured otherwise had notice and therefore assented to the terms of the master
policy excluding coverage for pre-existing conditions.”
Investor’s Nat’l Life Ins.
Co. v. Norsworthy
,
ERISA preempts “any and all State laws insofar as they may now or
hereafter relate to any employee benefit plan.” 29 U.S.C. § 1144(a). ERISA’s
preemptive scope is expansive and limited only by the savings clause.
Id
.
§ 1144(b)(2)(A). Here, Mrs. Singletary acknowledges that her “employee
welfare benefit plan [is] governed by the Employee Retirement Income
Security Act.” Given that she is relying on Section 33-27-3(a)(7) to strike a
provision of a plan governed by ERISA, Section 33-27-3(a)(7) relates to her
employee benefit plan.
See Shaw v. Delta Airlines, Inc.
,
Since ERISA preemption applies to Section 33-27-3(a)(7), the statute is saved only if it is: (1) “directed toward entities engaged in insurance”; and (2) “substantially affect[s] the risk pooling arrangement between the insurer and the insured.” Kentucky Ass’n of Health Plans, Inc. v. Miller , 538 U.S. 329, 341−42 (2003). Section 33-27-3(a)(7) may be directed towards insurance entities, but it does not substantially affect the risk pooling agreement between insurers and the insureds. Section 33-27-3(a)(7) simply requires a certificate be sent from an insurer (Prudential) to a policyholder (UPS) to the insured (Singletary). It does not affect the risk pooling agreement at all. Therefore, Section 33-27-3(a)(7) is not saved from preemption.
AFFIRMED.
Notes
[1] The “plan administrator’s duty of . . . disclosing information to participаnts . . . [is] located in subparts D, E and F”; subpart F deals with SPDs. 29 C.F.R. § 2520.101-1.
[2] Section 1132 is in Chapter 18, Subchapter I, Part 5, while Section 1021 is in Part 1.
[3] In
Strom
, the Second Circuit also eventually offered “‘equitable relief’ within the
meaning of Section [1132](a)(3)(B).”
[4] The first amended complaint did not alter the ERISA claim.
[5] Although Mrs. Singletary’s complaint states that she is a “resident of the Parish of Jefferson, State of Louisiana,” there is no information in the record about whether Specialist Singletary or the other persons involved in the motorcycle accident were Louisiana residents.