Groves v. USAble Life
ORDER DISMISSING CASE with prejudice. USAble Life is entitled to judgment as a matter of law. Signed by Judge D. P. Marshall Jr. on 10/17/13. (kpr)
IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
CAROLYN R. GROVES
Carolyn Groves worked for more than thirty years at the Cave City
School District as a kindergarten teacher. USAble Life administers the
District's ERISA plan. Groves says that USAble Life wrongfully denied her
application for long-term disability benefits. The issues are whether Groves
exhausted her administrative remedies and the timeliness of her lawsuit
challenging the denial.
The dates are important.
• 22 April2008:
Groves applied for long-term disability benefits.
NQ 11 at 2.
•18 September 2008:
USAble denied Groves's application because
there was no objective medical evidence to
support her claim. R. at 9-12. USAble advised
Groves that she had 180 days to appeal its
decision to deny benefits. R. at 11.
Proofofclaimrequired, based on the April2008
application and the plan's elimination period.
R. at 11, 92 & 176.
• 17 March 2009:
Groves's 180-day appeal window closed.
• 8 March 2011:
Groves appealed the denial. R. at 15.
• 9 June 2011:
USAble denied the first appeal. R. at 5-8.
• 18 July 2011:
Groves appealed a second time. R. at 213. Her
time to sue was tolled. R. at 8.
USAbledeniedhersecondappeal. R. at 189-191.
Her time to sue began to run again. R. at 8.
• 18 November 2011: Her three-year period to sue under the plan
would have expired but for tolling. R. at 176.
• 28 January 2012:
Her three-year period to sue under the plan
expired taking into account the 71 days of
tolling. R. at 176.
• 3 May 2012:
Groves filed this lawsuit.
Under settled law, Groves had to exhaust her administrative remedies
under the District's plan. E.g., Wert v. Liberty Life Assurance Company oj Boston,
Inc.,447 F.3d 1060,1062-66 (8th Cir. 2006) (canvassing the cases). Neither the
futility nor the no-administrative-remedy exception applies. Angevine v.
Anheuser-Busch Companies Pension Plan, 646 F.3d 1034, 1037 (8th Cir. 2011).
USAble advised Groves when it initially denied her claim that she could
appeal within 180 days. R. at 11. She waited almost two years after her
deadline to do so. R. at 15. USAble rejected her appeal on the merits, not on
tardiness. R. at 5-8.
As the Court of Appeals has clarified, though, a
beneficiary must follow her plan's appeal procedures-including the
deadlines- to exhaust administrative remedies. Chorosevic v. Met life Choices,
600 F.3d 934, 945 (8th Cir. 2010); see also Reindl v. Hartford Life and Accident
Insurance Co., 705 F.3d 784, 787 (8th Cir. 2013) (affirming plan administrator's
rejection of a belated appeal solely on untimeliness grounds). The Court of
Appeals has reasoned that a contrary rule "would enable claimants to easily
circumvent a plan's appeals procedure, thereby rendering toothless a plan's
time limits for claims and appeals." Chorosevic, 600 F.3d at 945. This Court
must follow this precedent. Groves's untimely appeals therefore did not
suffice to exhaust her administrative remedies.
If the Court is mistaken on the exhaustion issue, Groves's complaint is
time-barred in any event. The District's plan specified when Groves could
sue and when her time to do so expired.
A claimant or the claimant's authorized representative
cannot start any legal action:
1. until60 days after proof of claim has been
2. more than 3 years after the time proof of claim
R. at 176. The expiration date is the critical one. The plan's three-year
period- though less than the five-year period that would otherwise have
been borrowed from Arkansas law- controls. Wilkins v. Hartford Life &
Accident Insurance Co., 299 F.3d 945,948 (8th Cir. 2002). It is not unreasonable.
Federal common law governs when Groves's claim accrued, that is,
when she could have sued USAble. A cause of action for plan benefits under
ERISA accrues when a plan fiduciary has formally denied an applicant's claim
for benefits or when there has been a repudiation by the fiduciary which is
clear and made known to the beneficiary." Abdel v. U.S. Bancorp, 457F.3d 877,
880 (8th Cir. 2006). The Court of Appeals has given conflicting signals about
[the accrual date.]" Abdel, 457 F.3d at 881. It has sometimes looked to the
initial denial, and other times to the denial of a timely appeal. Ibid.
Here, the plan created a three-year window for suit that was not
opened, as in some cases, by the claim's accrual. Wilkins involved a similar
provision. 299 F.3d at 948-49. USAble initially denied Groves's application
in September 2008. This was two months before the plan's November 2008
start date for the three-year period. R. at 9-12, 11, 92, & 176. And Groves filed
no timely administrative appeal.
Whenever Groves's claim accrued among the possible alternatives, her
lawsuit was untimely. There is some equitable tolling because USAble told
Groves that her time to sue was suspended while the company considered her
second appeal. R. at 8. Groves had until January 2012 to sue-three years
from the date proof of her claim was required, plus seventy-one days when
the limitations period was tolled. She filed this case in May 2012. That was
about five months too late. If her claim accrued at the initial denial, that
circumstance gave her a bit longer than three years to sue. If her claim
accrued when her time to appeal expired in March 2009, compare Abdel, 457
F.3d at 881, she had approximately two years and eight months available to
sue. She had approximately four months remaining in her limitations period
after USAble rejected her claim in the second appeal. Any way you look at it,
Groves's complaint is time-barred.
Groves argues that USAble is equitably estopped from asserting the bar
because it addressed Groves's tardy 2011 appeals on the merits. Precedent,
however, encourages ERISA administrators to review and reconsider claims
for benefits, Chorosevic, 600 F.3d at 943, even untimely ones, but belated
reconsideration "will not renew a claimant's cause of action for statute of
limitation purposes." Mason v. Aetna Life Insurance Co., 901 F.2d 662,664 (8th
Cir. 1990). Otherwise, "a participant could forestall the running of the statute
of limitation simply by declining to pursue internal remedies under the ERISA
plan." Abdel, 457 F.3d at 881. Groves's estoppel argument fails.
Groves waited too long- both to appeal for further review by USAble
and to sue. USAble Life is entitled to judgment as a matter of law. The Court
therefore dismisses Groves's case with prejudice.
D.P. Marshall Jr.
United States District Judge
Oct-o~ ;J.D 13
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