Griffin v. Teamcare et al

Filing 55

MEMORANDUM Opinion and Order: In 18 CV 1772, plaintiff W.A. Griffin, M.D.'s motion for summary judgment (Doc. 30 ) is denied as moot on Count I and granted on Count III. The court denies the consolidated summary judgment motion (Doc. 42 ) filed by defendants TeamCare, a Central States Health Plan, and Trustees of the Central States, Southeast and Southwest Areas Health and Welfare Fund. In 18 CV 8297, plaintiff's motion for summary judgment (Doc. 38 ) is granted. The court, havi ng considered the facts of both cases and exercising its discretion under 29 U.S.C. § 1132(c)(1), imposes a statutory penalty of $3,555. Civil case terminated. Signed by the Honorable Robert W. Gettleman on 9/27/2019. Mailed notice (cn).

IN THE UNITED STATES DISTR ICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVIS ION
W.A. GRIFFIN, M.D.,
Plaintiff,

v.
TEAMCARE, a Central States Health Plan, and
TRUSTEES OF THE CENTRAL STATES,
SOUTHEAST AND SOUTHWEST AREAS
HEALTH AND WELFARE FUND,
Defendants.

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Case No. 18 CV 1772
Case No. 18 CV 8297
Judge Robert W. Gettleman

MEMORANDUM OPINION A ND ORDER
Pro se plaintiff W.A. Griffin, a doctor, provided medical services to three patients. Those
patients were the beneficiaries of a health plan administered by defendants TeamCare and
Trustees of the Central States, Southeast and Southwest Areas Health and Welfare Fund. The
patients assigned their health plan benefits to plaintiff, who billed defendants for the medical
services she rendered. Defendants did not pay the full amount billed. Plaintiff challenged the
payment amounts. She also requested documents that defendants were required to provide under
the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq. Defendants
failed to timely produce those documents.
Plaintiff filed two suits. In case 18 CV 1772, plaintiff sued for: (1) failure to pay benefits
due, 29 U.S.C. § 1132(a)(1)(B); (2) breach of fiduciary duties, 29 U.S.C. § 1104; and (3) failure
to provide requested documents, 29 U.S.C. § 1132(c)(1)(B). This court dismissed plaintiff’s suit.
Griffin v. TeamCare, 18 CV 1772, 2018 WL 3685511, at *3 (N.D. Ill. June 21, 2018). The

Seventh Circuit vacated and remanded in part, holding that plaintiff had stated claims for failure
to pay benefits due and for failure to provide requested documents. Griffin v. TeamCare, 909 F.3d
842, 847 (7th Cir. 2018).
On remand, plaintiff accepted defendants’ offer of judgment on her claim for failure to
pay benefits due, which included interest. The parties move for summary judgment on the only
remaining claim in case 18 CV 1772: plaintiff’s document request claim under 29 U.S.C.
§ 1132(c)(1)(B). They also move for summary judgment on plaintiff’s sole claim in case
18 CV 8297: another document request claim with similar alleged facts, brought under the same
statutory provision. For the following reasons, the court grants plaintiff’s motions for summary
judgment in both cases, denies defendants’ motions, and imposes a statutory penalty of $3,555.
BACKGROUND
Plaintiff’s allegations are described in Griffin, 2018 WL 3685511 at *1, and Griffin, 909
F.3d at 844–45. The court states only the facts relevant to the parties’ summary judgment
motions. Those facts are taken from the parties’ L.R. 56.1 statements and exhibits and are not
genuinely disputed.
Plaintiff provided medical services to three patients. Those patients assigned their plan
benefits to plaintiff. Plaintiff billed defendants for her medical services; defendants did not pay
her the full amount. Plaintiff challenged the payment amounts. She requested copies of various
documents, including: (1) the summary plan description; (2) fee schedules used to determine her
payment; and (3) an administration agreement between defendants and Healthcare Service
Corporation, an affiliate of Blue Cross Blue Shield Association that forwards out-of-network
claims to defendants for defendants to adjudicate.

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Under 29 U.S.C. § 1132(c)(1)(B), defendants were required to mail plaintiff the
appropriate requested documents within 30 days. They did not do so. For one patient, plaintiff
requested the summary plan description, fee schedules, and administration agreement on
February 13, 2017. She requested similar documents for two other patients on March 12, 2018,
and August 8, 2018. Plaintiff received: (1) the summary plan description on August 18, 2017
(187 days after her first request); (2) the fee schedules on January 29, 2019 (716 days); and
(3) the administrative agreement on February 25, 2019 (743 days).
DISCUSSION
The parties move for summary judgment in both cases. Summary judgment is proper
when no material fact is genuinely disputed and the moving party is entitled to judgment as a
matter of law. Fed. R. Civ. P. 56(a). A material fact is genuinely disputed if the evidence would
allow a reasonable jury to return a verdict for the non-moving party. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). Once the moving party meets its burden, the non-moving party
must go beyond the pleadings and set forth specific facts showing a genuine issue for trial. Fed.
R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The court draws all
justifiable inferences in favor of the non-moving party. Anderson, 477 U.S. at 255.
The parties raise three issues: (1) whether plaintiff, as an assignee, has standing to sue for
statutory penalties; (2) whether plaintiff was entitled to the fee schedules or the administration
agreement; and (3) whether the court should impose statutory penalties—and if so, the amount.
The first issue determines whether plaintiff is entitled to summary judgment. The second and
third issues affect penalties. The court holds that plaintiff has standing and is thus entitled to
summary judgment. As for penalties, the court holds that plaintiff was entitled to both documents
and imposes a statutory penalty of $3,555.

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1

Standing
Plaintiff has standing to sue for statutory penalties. See Griffin, 909 F.3d at 846–47 (7th

Cir. 2018) (holding that because plaintiff needed to know “how Central States determined the
usual, reasonable, and customary rate,” she “must be a beneficiary able to sue when she is denied
requested information”). Defendants’ argument to the contrary relies on section 11.06 of Central
States’ plan: “Any provider of medical or healthcare services . . . seeking to receive[ ] payment
from the Fund will, in the absence of evidence to the contrary, be presumed to have claimed a
right to do so pursuant to a valid assignment of benefits . . . .” (emphasis added).
Defendants argue that the phrase “assignment of benefits” excludes an assignee from
claiming statutory penalties. Not so. Under section 11.06, an assignee may become entitled to a
benefit. A person who “may become entitled to a benefit” is a “beneficiary.” 29 U.S.C. § 1002(8).
A beneficiary “can sue for unpaid benefits under section 1132(a)(1)(B),” so “[i]t follows that
Dr. Griffin also must be a beneficiary able to sue when she is denied requested information.”
Griffin, 909 F.3d at 847 (vacating this court’s dismissal of plaintiff’s document request claim).
Nothing in section 11.06 modifies “assignment of benefits” such that the assignee is no longer a
“beneficiary” under 29 U.S.C. § 1002(8)—a beneficiary with standing to sue for penalties.
Defendants do not dispute that they were required to send plaintiff the summary plan
description within thirty days and that they failed to do so. Because plaintiff has standing to sue
for defendants’ tardiness, she is entitled to summary judgment in both cases.
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Fee schedules and administration agreement
The remaining issues affect penalties. First, defendants argue that they were not required

to send plaintiff their vendor’s fee schedules or their administration agreement with Blue Cross
Blue Shield. The court disagrees. Plan administrators must produce “instruments under which the

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plan is established or operated.” 29 U.S.C. § 1024(b)(4). The fee schedules and the
administration agreement were documents under which defendants’ plan is operated. Defendants
were thus required to disclose both.
2.1

Fee schedules

In explaining plaintiff’s benefits, defendants cited a third-party vendor’s fee schedules.
Those fee schedules were “part of the ‘pricing methodology’ that Central States cited in
explaining Dr. Griffin’s benefits.” Griffin, 909 F.3d at 847 (7th Cir. 2018), quoting Mondry v.
American Family Mutual Insurance Co., 557 F.3d 781, 800 (7th Cir. 2009). By relying on the fee
schedules to explain plaintiff’s benefits, defendants gave the schedules “the status of documents
that govern the operation of a plan.” Mondry, 557 F.3d at 800. Their disclosure “thus became
mandatory under section 1024(b)(4).” Id.
2.2

Administration agreement

Defendants were also required to disclose their administration agreement with Blue Cross
Blue Shield. That administration agreement “governs the operation of the plan in that it defines
the roles of the plan and claims administrators.” Griffin, 909 F.3d at 847. Defendants argue that
the agreement is irrelevant to plaintiff’s benefits claims. They point out that “BCBS has a purely
mechanical and clerical, non-discretionary function” for out-of-network claims, claims that are
merely “sent to BCBS” and “passe[d] . . . to Central States without making an adjudication.”
There is no dispute that defendants adjudicate out-of-network claims and that Blue Cross
Blue Shield, in contrast, has a limited role. But even when “the administration of a plan is
divided . . . the extent of each administrator’s authority is basic information that a plan
participant needs to know.” Mondry, 557 F.3d at 796 (7th Cir. 2009) (citation omitted). The court
in Mondry rejected precisely the argument defendants press. It reversed the dismissal of a

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document request claim and remanded with directions to enter summary judgment for the
plaintiff, holding that the plan administrator needed to disclose an administration agreement—
even though that agreement did not “define what rights or benefits [were] available to the Plan’s
participants and beneficiaries.” Id. at 796, 803 (alteration in original). So too here. Even though
the administration agreement did not define plaintiff’s rights as a beneficiary, it defined the scope
of defendants’ authority against that of Blue Cross Blue Shield. It was thus information about
how defendants’ plan operates and subject to disclosure under 29 U.S.C. § 1024(b)(4).
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Statutory penalties
The remaining issue is whether the court should impose a statutory penalty—and if a

penalty is imposed, the amount. When a plan administrator fails to respond to a document
request within 30 days, a court may impose penalties for each day that the administrator is tardy,
up to $110 per day. 29 U.S.C. § 1132(c)(1)(B); 29 C.F.R. § 2575.502c-1. The penalty amount—
and whether to impose a penalty at all—is “in the court’s discretion.” Id.; Ames v. American
National Can Co., 170 F.3d 751, 759–60 (7th Cir. 1999) (affirming a decision not to impose
penalties because the district court had found good faith and lack of prejudice).
Several factors guide the court’s discretion. The most important is whether a penalty
would “induce plan administrators to respond in a timely manner.” Winchester v. Pension
Comm. of Michael Reese Health Plan, Inc. Pension Plan, 942 F.2d 1190, 1193 (7th Cir. 1991).
Other factors that courts may consider include the number of requests made, the length and
reasons for the delay, whether the administrator acted in good faith, and whether the beneficiary
was prejudiced. Ziaee v. Vest, 916 F.2d 1204, 1211 (7th Cir. 1990); Krueger Int’l, Inc. v. Blank,
225 F.3d 806, 810 – 11 (7th Cir. 2000); Kleinhans v. Lisle Savings Profit Sharing Trust, 810 F.2d
618, 622 (7th Cir. 1987); Mondry, 557 F.3d at 806 (7th Cir. 2009).

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None of the parties comes out a clear winner. Plaintiff made multiple requests, although
the second two requests included the summary plan description that she had already received.
The length of the delay was significant. Defendants argue that “occasional glitches and delays
should not be surprising,” given “the huge number of claims and document requests” they
process. That explanation is unsatisfying. Although defendants may reasonably have thought that
the administration agreement was irrelevant and that they could not have easily obtained fee
schedules from its vendor, “occasional glitches” do not explain their six-month delay in
producing the summary plan description. Nor do defendants explain their delay in producing the
fee schedules and administration agreement after the Seventh Circuit rejected their arguments as
“meritless,” holding that defendants were “required to produce, as requested, Data iSight’s fee
schedules,” and “required to provide” the “contract between Central States and Blue Cross Blue
Shield.” Griffin, 909 F.3d at 847 (7th Cir. 2018).
Yet, plaintiff offers no evidence that she was prejudiced. She received the fee schedules
ten days before she accepted defendants’ offer of judgment but does not argue that those fee
schedules improved her bargaining position. Nor could they have done so; defendants offered,
and plaintiff accepted, the entire amount of her claimed underpayment, plus interest. As for the
administration agreement—which plaintiff received months before filing her reply brief—
plaintiff argues that having it in hand “would have supported additional claim for breaches of
fiduciary duty and provided insight into how each party conducts its fiduciary role during the
claim and appeal process.” That is entirely conclusory. Despite now having the administration
agreement, plaintiff does not explain the nature of those “additional claim[s] for breaches of
fiduciary duty.” Nor does she explain how the agreement would otherwise have been relevant:

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she offers no evidence to dispute that Blue Cross Blue Shield lacks authority to adjudicate outof-network claims.
Plaintiff also argues that stiff penalties are needed because “court records have proven
that Central States is a repeat offender”—those “court records” being her own cases before this
court—and that defendants’ “underhanded tactics” harm “solo providers like Dr. Griffin, that
barely keep business operations moving forward.” Yet plaintiff offers no evidence that
defendants have withheld documents in other cases. Nor does she offer evidence that they did so
in bad faith, in this case or in any other. Nor does plaintiff offer any evidence that she runs her
medical practice on a shoestring budget—or even that she is a solo provider. Plaintiff cannot rest
on her complaint’s allegations: the point of summary judgment is “to pierce the pleadings and to
assess the proof . . . to see whether there is a genuine need for trial.” Matsushita Electric
Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (emphasis added; citation
and quotation marks omitted).
Given defendants’ inadequate explanation for their substantial delay—and plaintiff’s
inadequate explanation for how she was prejudiced—the court cannot find that defendants acted
in bad faith, nor can the court find that plaintiff was in any way prejudiced. The penalty thus turns
on whether a penalty would “induce plan administrators to respond in a timely manner.”
Winchester, 942 F.2d at 1193 (7th Cir. 1991).
The court concludes that a modest penalty of five dollars per day (along with the costs
and burdens of having had to defend these suits) is enough to encourage defendants to more
promptly respond to requests from beneficiaries. Some courts in comparable situations have
declined to impose penalties; others have imposed penalties across the spectrum, from two to
seventy-five dollars a day. See Jackson v. E.J. Brach Corp., 937 F. Supp. 735, 742 (N.D. Ill.

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1996) (collecting statutory penalty cases in which the plaintiff “established little or no
prejudice”); Jones v. UOP, 16 F.3d 141, 145 (7th Cir. 1994) (affirming a twenty-dollar daily
penalty because, in part, the plaintiff “was unable to show any harm from the delays”); Fenster v.
Tepfer & Spitz, Ltd., 301 F.3d 851, 858 (7th Cir. 2002) (holding that the district court
“reasonably determined that no penalty was required” because the plan’s “failure to comply with
the statute” caused no “material[ ] prejudice”).
The parties offer no argument and no authority about whether to multiply that
five-dollar daily penalty per document. If a beneficiary requests ten documents, and the plan
administrator produces all ten documents on the thirty-first day, and a court imposes a penalty of
$100 per day, must the plan pay $100, or $1,000? See Ziaee v. Vest, 916 F.2d 1204, 1210–11 (7th
Cir. 1990) (discussing but not deciding whether penalties may be imposed per “document day”).
Nor do the parties discuss whether to multiply the daily penalty per request. See id. (discussing
but not deciding whether penalties may be imposed per request). The court assumes without
deciding that multiplying the daily penalty per document or per request might sometimes be
proper. The court need not do so, however, to arrive at a fair penalty in this case. See Mondry v.
American Family Mutual Insurance Co., 497 F. App’x 603, 610–11 (7th Cir. 2012) (“Like the
district judge, we assume without deciding that stacking might be appropriate in some cases; but
we detect no abuse of discretion in the judge’s conclusion that this was not such a case.”).
The five-dollar daily penalty runs from March 16, 2017 (the thirty-first day after plaintiff
first requested documents on February 13, 2017), to February 24, 2019 (the day before
defendants sent plaintiff the administration agreement), which is 711 days. Defendants must pay
plaintiff a penalty of five dollars per day for 711 days: $3,555.

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CONCLUSION
In 18 CV 1772, plaintiff W.A. Griffin, M.D.’s motion for summary judgment (Doc. 30) is
denied as moot on Count I and granted on Count III. The court denies the consolidated summary
judgment motion (Doc. 42) filed by defendants TeamCare, a Central States Health Plan, and
Trustees of the Central States, Southeast and Southwest Areas Health and Welfare Fund. In
18 CV 8297, plaintiff’s motion for summary judgment (Doc. 38) is granted. The court, having
considered the facts of both cases and exercising its discretion under 29 U.S.C. § 1132(c)(1),
imposes a statutory penalty of $3,555.
ENTER:

September 27, 2019

__________________________________________
Robert W. Gettleman
United States District Judge

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