Ferrell v. Capitol City Bank and Company

Filing 35

ORDER: Plaintiff has failed to state a claim against Defendant under any of the subsections of 28 U.S.C. § 1132 and Defendant's 21 Motion for Judgment on the Pleadings as to Count I of Plaintiff's Amended Complaint is GRANTED. Signed by Judge Richard W. Story on 10/25/2013. (cem)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
JOANN J. FERRELL,

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Plaintiff,
v.
CAPITOL CITY BANK AND CO.
d/b/a CAPITOL CITY BANK &
TRUST CO.,
Defendant.

CIVIL ACTION NO.
1:13-CV-00240-RWS

ORDER
This case comes before the Court on Defendant’s Motion for Judgment
on the Pleadings on Plaintiff’s ERISA Breach of Fiduciary Duty Claim
(“Motion for Judgment on the Pleadings”) [21]. After considering the record,
the Court enters the following Order.
Background
Plaintiff was an employee of Defendant’s for more than seven (7) years
as a switchboard operator, payroll and benefits specialist, and credit
administrator. (First Am. Compl., [19] ¶ 10.) During Plaintiff’s employment,
Defendant held group contracts with Genworth Life and Health Insurance
Company (“Genworth”) to provide long term and short term disability benefits

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to its employees. (Id. ¶ 11.) Plaintiff was a participant in these employee
benefit plans. (Id. ¶ 26.) On December 1, 2007, Genworth changed its name to
“Sun Life and Health Insurance Company (U.S.)” (“Sun Life”). (Def. Answer,
[20-3] at 3 of 6.)
On or around November 3, 2011, Plaintiff’s rheumatologist, Dr. Carolyn
Felton, recommended that Plaintiff take medical leave from November 7, 2011
through December 12, 2011 because of Plaintiff’s osteoarthritis, severe joint
pain, severe anxiety, and Crohn’s disease. (First Am. Compl., [19] ¶¶ 27-28.)
Dr. Felton supplied Plaintiff with a form stating Plaintiff’s need for leave on
these dates. (Id. ¶ 29.) Despite Dr. Felton’s recommendation, Plaintiff
continued to work for approximately three (3) weeks after November 7, 2011,
in order to complete certain tasks prior to taking leave. (Id. ¶¶ 30-31.) Plaintiff
informed Dr. Felton of her continued work and on or around November 22,
2011, Dr. Felton supplied Plaintiff with an amended medical leave form. (Id. ¶¶
31-32.) The amended form had Plaintiff’s leave commencing on November 28,
2011. (Id. ¶ 32.)
On or around November 25, 2011, Plaintiff submitted an application to
Defendant’s human resources consultant for short term disability benefits and
medical leave under the Family Medical Leave Act (“FMLA”). (Id. ¶¶ 33-36.)
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Plaintiff’s application materials included Dr. Felton’s initial medical leave form
dated November 3, 2011, Dr. Felton’s amended medical leave form dated
November 22, 2011, a fax cover sheet from Dr. Felton’s office dated November
22, 2011, and a FMLA Notice of Eligibility and Rights & Responsibilities form.
(Id. ¶ 37.) The fax cover sheet from Dr. Felton’s office indicated her
recommendation that Plaintiff take medical leave from November 28, 2011 to
January 3, 2012. (Id. ¶ 38.) At the insistence of Defendant’s executives, the
human resources consultant transferred Plaintiff’s application to an employee of
Defendant’s. (Id. ¶ 39.) On December 28, 2011, Defendant informed Plaintiff
via letter that she was suspended without pay until further notice. (Id. ¶ 40.)
The letter stated that Plaintiff’s suspension was “due to information that was
presented to the Company for a request for short term disability leave on
[Plaintiff’s] behalf.” (Id.)
Plaintiff alleges that Defendant repeatedly contacted Dr. Felton to inquire
whether Plaintiff had altered Dr. Felton’s recommendation for medical leave.
(Id. ¶ 45.) Dr. Felton informed Defendant that she amended her medical leave
recommendation based on Plaintiff working an additional three weeks. (Id. ¶¶
45-46.) In a letter dated January 10, 2012, Dr. Felton wrote to Defendant
explaining Plaintiff’s condition, treatment program, need for medical leave, and
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reason for delayed medical leave. (Id. ¶ 54.) Nonetheless, Defendant informed
Sun Life that Plaintiff had altered health information on her short term
disability benefits application. (Id. ¶ 41.) Defendant repeatedly contacted Sun
Life to inquire about the status of Plaintiff’s short term disability claim. (Id. ¶
42.) Defendant also had its disability insurance broker contact Sun Life to
inquire about the status of Plaintiff’s claim. (Id. ¶ 52.)
On January 10, 2012, Defendant terminated Plaintiff’s employment. (Id.
¶ 55.) The termination letter stated:
During the time of your suspension, we reviewed all
of the information pertaining to your Leave Request
that was submitted and signed by you. After carefully
reviewing your Leave Request, we found several
discrepancies with the dates as well as some of the
content . . . Therefore, we are terminating your
employment with Capitol City Bank & Trust
Company for Breach of Trust effective immediately.
(Id.) Sun Life denied Plaintiff’s short term disability benefits claim. (Id. ¶ 60.)
Plaintiff filed this suit having exhausted all administrative remedies known to
her. (Id. ¶ 66-67.)
Discussion
I.

Legal Standard

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After the pleadings are closed but within such time as not to delay trial, a
party may file a motion for judgment on the pleadings. FED. R. CIV. P. 12(c).
Judgment on the pleadings is appropriate only when no issues of material fact
exist, and the movant is entitled to judgment as a matter of law. Ortega v.
Christian, 85 F.3d 1521, 1524 (11th Cir. 1996). A court considers only the
substance of the pleadings and any judicially noticed facts, and the court
accepts the facts in the complaint as true and views them in the light most
favorable to the nonmoving party. Hawthorne v. Mac Adjustment, Inc., 140
F.3d 1367, 1370 (11th Cir. 1998). The complaint may not be dismissed “unless
it appears beyond doubt that the plaintiff can prove no set of facts in support of
his claim which would entitle him to relief.” Slagle v. ITT Hartford, 102 F.3d
494, 497 (11th Cir. 1996) (quoting Conley v. Gibson, 355 U.S. 41, 45-46
(1957)).
Rule 12(c) provides that if matters outside the pleadings are considered,
the court may convert the motion for judgment on the pleadings to a motion for
summary judgment. Pleadings include the complaint and answer. Fed. R. Civ.
P. 7(a). Written instruments which are exhibits to a pleading are considered a
part of the pleading. Fed. R. Civ. P. 10(c).

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II.

Analysis
Defendant’s Motion for Judgment on the Pleadings [21] addresses only

Count I of Plaintiff’s First Amended Complaint [19]. Count I alleges breach of
fiduciary duty under the Employee Retirement Income Security Act of 1974
(“ERISA”), 29 U.S.C. § 1132.1 Three subsections of § 1132 could apply to
Plaintiff’s claim. Plaintiff did not specify a subsection in her Amended
Complaint so the Court will evaluate her claim under each of them.
A.

Section 1132(a)(1)(B)

Plaintiff asserts that she is not bringing a claim under section
1132(a)(1)(B), which provides beneficiaries or plan participants the right to
recover benefits due them under the terms of the benefit plan. (Plaintiff’s Brief
in Opp., [26] at 8-12.) The Court accepts Plaintiff’s representation and will not
evaluate the merits of her claim under this subsection.2
1

ERISA section 502 is codified at 29 U.S.C. § 1132 and will be referred to
hereinafter as “section 1132.”
2

Even if Plaintiff were asserting a claim under 1132(a)(1)(B), it is questionable
whether Capitol City would be the proper defendant. In the Eleventh Circuit, this
subsection “confers the right to sue the plan administrator for recovery of benefits.”
Hamilton v. Allen-Bradley Co., 244 F.3d 819, 824 (11th Cir. 2001). The plan
administrator has “decisional control over the claim process.” Id. “Proof of who is
the plan administrator may come from the plan document, but can also come from the
factual circumstances surrounding the administration of the plan, even if these factual
circumstances contradict the designation in the plan document.” Id.
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B.

Section 1132(a)(3)

Section 1132(a)(3) authorizes a civil action “(3) by a participant,
beneficiary, or fiduciary (A) to enjoin any act or practice which violates any
provision of this subchapter or the terms of the plan, or (B) to obtain other
appropriate equitable relief (i) to redress such violations or (ii) to enforce any
provisions of this subchapter or the terms of the plan.” 29 U.S.C. § 1132(a)(3).
This section has been described as a “catchall” provision, providing appropriate
equitable relief when adequate remedies are not otherwise available under the
statute. Varity Corp. v. Howe, 516 U.S. 489, 512 (1996). In the Eleventh
Circuit, an ERISA plaintiff who has an adequate remedy under section

Plaintiff suggests that, based on the allegations in Count I of the Amended
Complaint, Capitol City was “acting in the role of plan administrator.” (Plaintiff’s
Brief in Opp., [26] at11.) However, the plan documents identify Genworth (later Sun
Life) as the “claims fiduciary” with “sole and exclusive discretion and power to grant
and/or deny any and all claims for benefits, and construe any and all issues relating to
eligibility for benefits.” (Def. Answer, [20-1] at 21 of 23.) Even though the plan
documents name Plaintiff herself as the “plan administrator,” her Complaint states:
“her actual job responsibilities included only the performance of clerical functions”
(i.e., no decisional control). (First Am. Compl., [19] ¶ 18.) Plaintiff admits that Sun
Life denied her benefits and the record shows that it had ultimate control over her
claim.
To the extent Plaintiff alleges Defendant is a plan administrator because it has
the power to retain or terminate its benefit plan provider, the Court finds this argument
unpersuasive. (See Id. ¶ 15.) Under Plaintiff’s reasoning, any employer could be
deemed a plan administrator, regardless of its decisional control – or lack thereof –
over the claims process.
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1132(a)(1)(B) cannot alternatively plead and proceed under section 1132(a)(3).
Katz v. Comprehensive Plan of Group Ins., 197 F.3d 1084, 1089 (11th Cir.
1999). Even if the plaintiff’s claim under section 1132(a)(1)(B) is lost, the fact
that plaintiff had a remedy under that subsection will still preclude a claim for
equitable relief under section 1132(a)(3). Odgen v. Blue Bell Creameries
U.S.A., Inc., 348 F.3d 1284 (11th Cir. 2003) (where 1132(a)(1)(B) provided
plaintiff with an adequate remedy at the time his cause of action arose, plaintiff
could not have proceed under 1132(a)(3)); Katz, 197 F.3d at 1089 (availability
of an adequate remedy under the law does not mean, nor does it guarantee, an
adjudication in one’s favor and plaintiff’s claim under 1132(a)(3) was
precluded even though she did not prevail on the merits of 1132(a)(1)(B)); see
Varity, 516 U.S. at 515 (“where Congress elsewhere provided adequate relief
for a beneficiary’s injury, there will likely be no need for further equitable
relief”).
To determine if Plaintiff may bring a claim under section 1132(a)(3), the
Court considers whether Plaintiff has a cause of action, based on the same
allegations, under the more specific remedial provisions of ERISA. See Jones
v. Am. Gen. Life & Accident Ins. Co., 370 F.3d 1065, 1073 (11th Cir. 2004).
Here, the Court finds that Plaintiff’s allegations under Count I support a claim
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for recovery of benefits under 1132(a)(1)(B). Plaintiff contends that the relief
she seeks in Count I removes the claim from (a)(1)(B), but the relief sought is
not dispositive of the issue.3 Id. at 1073-74 (finding that the district court
should have considered whether allegations supporting the 1132(a)(3) claim
were sufficient to state a cause of action under 1132(a)(1)(B), regardless of the
relief sought).
The root of Plaintiff’s grievance is that she was wrongfully denied short
term disability benefits. Indeed, the Amended Complaint is rife with this
particular claim. (See First Am. Compl., ¶¶ 41-42, 56-57, 59-60, 64-65, 74.)
Plaintiff’s allegations regarding Defendant’s ERISA violations affect her only
to the extent she was denied benefits to which she believes she is entitled.
Thus, 1132(a)(1)(B) provides an adequate remedy in this case and reliance on
1132(a)(3) is improper. See Byars v. Coca-Cola, Co., 2004 WL 1595399, No.
1:01-CV-3124-TWT, at *4-5 (N.D. Ga. Mar. 18, 2004) (where plaintiffs’
allegations regarding ERISA violations “concern the decision to award or deny
benefits,” (a)(3) provides an adequate remedy).

3

The Court also notes that Plaintiff does seek recovery of benefits in her
Amended Complaint. (First Am. Compl., [19] at 29 of 30, ¶ 9.)
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In sum, Plaintiff may not recover under section 1132(a)(3) because the
allegations in her Amended Complaint support a cause of action under section
1132(a)(1)(B), and (a)(1)(B) would provide adequate relief for Plaintiff’s claim.
C.

Section 1132(a)(2)

Under section 1132(a)(2), a plan participant or beneficiary may file a
civil action “for appropriate relief under section 1109 of this title.” 29 U.S.C. §
1132(a)(2). Relief under 1132(a)(2) for breach of fiduciary duty inures to the
plan itself, not to individual participants or beneficiaries. Heffner v. Blue Cross
Blue Shield of Alabama, Inc., 443 F.3d 1330, 1339 (11th Cir. 2006); see also
Byars, 2004 WL 1595399, at *7 (“[Section 1109(a)] of ERISA was interpreted
by the Supreme Court as providing ‘relief singularly to the plan’ and ‘remedies
that would protect the entire plan,’ rather than the rights of an individual
beneficiary.”) (quoting Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S.
134, 142 (1985)). “Accordingly, for relief to be available under section [1109],
the [ ] Plan itself must have suffered a loss.” Byars, 2004 WL 1595399, at *7.
Neither Count I nor any of the preceding paragraphs in Plaintiff’s
Amended Complaint contains any allegations regarding a loss suffered by the
Plan. Further, Plaintiff’s requests for relief seek damages for her, not for the
Plan. Therefore, Plaintiff has not stated a claim under 1132(a)(2).
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Conclusion
Based on the foregoing, Plaintiff has failed to state a claim against
Defendant under any of the subsections of 29 U.S.C. § 1132 and Defendant’s
Motion for Judgment on the Pleadings [21] as to Count I of Plaintiff’s Amended
Complaint is GRANTED.
SO ORDERED, this 25th

day of October, 2013.

_______________________________
RICHARD W. STORY
UNITED STATES DISTRICT JUDGE

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