Tatera v. Prudential Insurance Company Of America

Filing 23

ENTER MEMORANDUM Opinion and Order Signed by the Honorable Harry D. Leinenweber on 9/1/2011: Mailed notice (jmp, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

NANCY J. TATERA,
Plaintiff,
Case No. 11 C 2667
v.
THE PRUDENTIAL INSURANCE CO.
of AMERICA and W.W. GRAINGER
INC. EMPLOYEE BENEFIT PLAN,
a/k/a W.W. GRAINGER GROUP
BENEFIT PLAN I,

Hon. Harry D. Leinenweber

Defendants.

MEMORANDUM OPINION AND ORDER
The instant suit involves Plaintiff Nancy Tatera’s (“Tatera”)
attempt to recover long- and short-term disability benefits that
she claims she was improperly denied under the Employee Retirement
Security Act (“ERISA”), 29 U.S.C. § 1001, et seq.

Defendant

Prudential Ins. Co. (“Prudential”), the plan administrator, moves
for dismissal of Tatera’s First Amended Complaint pursuant to FED .
R. CIV. P. 12(b)(6), arguing that it is not a proper defendant as
a matter of law.

For the reasons stated herein, the motion is

granted.
I.

BACKGROUND

For the purposes of this motion, the details of Tatera’s claim
are

irrelevant.

She

seeks

to

recover

benefits

under

Section 502(a)(1)(B), which allows a beneficiary to bring a civil

claim to recover benefits under the terms of an ERISA plan, to
enforce rights under the plan, or to clarify rights to future
benefits.

29 U.S.C. § 1132(a)(1)(B).

This provision, however,

does not address the proper party to be sued, and that is at issue
here.

Prudential, citing Seventh Circuit authority, argues that

only the plan itself is subject to suit.
and

Prudential,

as

the

plan

Tatera contends the plan

administrator,

were

“confusingly

intertwined,” making Prudential an appropriate defendant.
II.

LEGAL STANDARD

In ruling on a Rule 12(b)(6) motion to dismiss, the Court must
determine whether the Plaintiff’s complaint includes sufficient
facts to state a facially plausible claim for relief.

Specht v.

Google, Inc., 660 F.Supp.2d 858, 862 (N.D. Ill. 2009) (internal
citations omitted).

A claim is facially plausible when the facts

alleged allow the court to draw a reasonable inference of the
defendant’s liability for the wrongdoing alleged.
citations omitted).

Id. (internal

In ruling on a motion to dismiss, the Court

assumes all well-pleaded allegations in the complaint to be true
and draws all inferences in the light most favorable to the
plaintiff. Killingsworth v. HSBC Bank, 507 F.3d 614, 618 (7th Cir.
2007).
III.

ANALYSIS

In seeking dismissal, Prudential relies on the general rule in
the Seventh Circuit that in a suit for ERISA benefits, the claimant
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is

limited

to

administrator.

a

suit

against

the

plan

itself,

not

the

Mote v. Aetna Life Ins. Co., 502 F.3d 601, 610 (7th

Cir. 2007) (citing Blickenstaff v. R.R. Donnelly & Sons Co. Short
Term Disability Plan, 378 F.3d 669, 674 (7th Cir. 2004)).

This

limitation stems from Section 1132(d)(2) of ERISA, which provides:
“any money judgment under this subchapter against an employee
benefit plan shall be enforceable only against the plan as an
entity and shall not be enforceable against any other person unless
liability against such person is established in his individual
capacity under this subchapter.”

29 U.S.C. § 1132(d)(2); see

Hackner v. Long Term Disability Plan for Emps. of Havi Group LP, 81
Fed. App’x. 589, 593 (7th Cir. 2003).
A claimant may sue a party other than the plan only in limited
circumstances.

Zuckerman v. United of Omaha Life Ins. Co., No. 9 C

4819, 2010 WL 2927694, at *3 (N.D. Ill. July 21, 2010).

For

example, the Seventh Circuit has held that an employer that serves
as the plan administrator is subject to suit where the plan
documents refer to the employer and the plan interchangeably.
Riordan v. Commonwealth Edison Co., 128 F.3d 549, 551 (7th Cir.
1997). Similarly, an employer that serves as plan administrator is
a proper defendant when the employer and the plan are closely
intertwined.
2001).

Mein v. Carus Corp., 241 F.3d 581, 584–85 (7th Cir.

These exceptions stand for the proposition that a party

other than the plan may be sued “when the identity of the plan is
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not discernable because of the close relationship between the
employer and the plan.”

Zuckerman, 2010 WL 2927694, at *3.

Tatera argues that in this instance, Prudential and the plan
are closely intertwined because it was Prudential that reviewed the
medical evidence and made the decision to terminate her short–term
disability benefits and deny her request for long–term disability
benefits.

Pl.’s Compl. at ¶ 10–15.

However, the fact that

Prudential was responsible for the denial of benefits is not enough
to make it a proper defendant under Seventh Circuit precedent.

In

Mote, the plan administrator had authority to determine “whether
and to what extent employees and beneficiaries are entitled to
benefits; and construe any disputed or doubtful terms” of the
policy.

Mote, 502 F.3d at 603.

The Seventh Circuit nonetheless

found that suit against the administrator was improper because the
administrator was not the claimant’s employer and the plan’s policy
distinguished

between

the

plan,

the

employer,

and

the

plan

administrator. Id. at 611; see also Zuckerman, 2010 WL 2927694, at
*3

(finding

allegation

that

plan

administrator

made

all

the

relevant decisions was insufficient to make it a proper defendant);
Schultz v. Prudential Ins. Co. of Am., 678 F.Supp.2d 771, 776 (N.D.
Ill. 2010) (applying general rule when plan administrator made
coverage decisions).
Tatera cites several cases from the Northern District as
supporting

her

position,

but

those

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cases

are

distinguishable

because they either pre–date the general rule confirmed by the
Seventh Circuit in Mote or involve circumstances in which the
identity of the plan was unknown or ambiguous.

Here, Tatera

clearly knows the identity of the plan, as it is named in her suit.
Tatera also relies on the Ninth Circuit’s recent ruling in Cyr v.
Reliance Standard Life Ins. Co., 642 F.3d 1202 (9th Cir. 2011).
There,

the

Ninth

Circuit

held

that

an

insurer

was

a

proper

defendant in a suit for disability benefits because it, and not the
plan administrator, was the entity that denied the claimant’s
request for increased benefits and that was responsible for paying
the benefits.

Id. at 1207.

The Ninth Circuit reasoned that the

relevant statutory language does not appear to limit the identity
of the parties to be sued, and found that it was logical for the
party that made the coverage decision to be named as the defendant.
Id. at 1205–07.
The Court recognizes that other circuits would allow Tatera’s
claim against Prudential to proceed. See North Cypress Med. Center
Operating Co. v. CIGNA Healthcare, --- F.Supp.2d ---, 2011 WL
819490, at *10 (S.D. Tex. March 2, 2011) (noting that several
circuits allow benefit claims against the party that controls plan
administration).
precedent.

But this Court is bound by Seventh Circuit

This is true even though some courts within this

circuit have questioned the prudence of the general rule that only
the plan may be sued for benefits.
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See Black v. Long Term

Disability Ins., 373 F.Supp.2d 897, 899–900 (E.D. Wis. 2005)
(observing that statutory language does not seem to compel the rule
and that a judgment against the plan could be unenforceable).
Tatera also notes that in other ERISA benefits cases in this
district,
defendant.

Prudential

has

stipulated

that

it

is

the

proper

Tatera argues that it is “disingenuous” for Prudential

to argue otherwise here, but cites no case law for the proposition
that Prudential is bound by prior litigation decisions in other
cases. As such, this cannot be a basis for denying dismissal.
Schultz, 678 F.Supp.2d at 776 n. 3.
dismiss must be granted.

See

So Prudential’s motion to

Prudential’s request for fees and costs

associated with bringing this motion is denied.
IV.

CONCLUSION

For the reasons stated herein, Prudential’s Motion to Dismiss
Plaintiff’s

First

Amended

Complaint

Pursuant

to

FED . R. CIV .

P. 12(b)(6) is granted.
IT IS SO ORDERED.

Harry D. Leinenweber, Judge
United States District Court
DATE:9/1/2011

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