Scott-Warren v. Liberty Life Assurance Company of Boston

Filing 50

MEMORANDUM OPINION AND ORDER signed by Senior Judge Charles R. Simpson, III on 2/19/2016. For the reasons set forth, Defendant's Motion for Partial Summary Judgment on Plaintiff's disgorgement claim 20 is GRANTED. cc: Counsel(RLK)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF KENTUCKY
AT LOUISVILLE
PLAINTIFF

SUZETTE SCOTT-WARREN

v.

CIVIL ACTION NO. 3:14-cv-00738-CRS

LIBERTY LIFE ASSURANCE
COMPANY OF BOSTON

DEFENDANT

MEMORANDUM OPINION AND ORDER
Defendant Liberty Life Assurance Company of Boston (“Liberty”) moves for partial
summary judgment on Plaintiff Suzette Scott-Warren’s claim under 29 U.S.C. § 1132(a)(3).
Scott-Warren filed suit alleging Liberty’s denial of long-term disability benefits was a
contractual breach under 29 U.S.C. § 1132(a)(1)(B). Scott-Warren also alleged a claim of
“disgorgement” under 29 U.S.C. §§ 1132(a)(1)(B) and 1132(a)(3). For the reasons below, the
Court will grant Liberty’s motion.
Standard
Before granting a motion for summary judgment, the Court must find that “there is no
genuine issue of material fact such that the moving party is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(a). The Court must view the evidence in a light most favorable to the
non-moving party. Scott v. Harris, 550 U.S. 372, 378 (2007). The non-moving party must show
that a genuine factual issue exists by “citing to particular parts of materials in the record” or by
“showing that the materials cited do not establish the absence ... of a genuine dispute[.]” Fed. R.
Civ. P. 56(c)(1). “The mere existence of a scintilla of evidence in support of the [non-moving
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party’s] position will be insufficient; there must be evidence on which the jury could reasonably
find for the [non-moving party].” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986).
Discussion
1. Breach of Fiduciary Duty or Disgorgement Claim
The Court agrees with Liberty that Scott-Warren did not state a claim for breach of
fiduciary obligations. Although Scott-Warren asserts that she “has also brought a claim under [29
U.S.C. § 1132](a)(3), seeking relief for Liberty’s breach of its fiduciary obligations,” Mot.
Compel 5, ECF No. 17, her complaint is devoid any mention of such a claim. If Scott-Warren
seeks relief for breach of fiduciary duty, the proper avenue to assert such a claim is to amend the
complaint. See Fed. R. Civ. P. 15.
Furthermore, Scott-Warren’s second claim, which she characterizes as a “disgorgement”
claim, Compl. ¶¶ 18 – 20, and also as a “breach of fiduciary duty” claim, Resp. 6, ECF No. 32;
see also Mot. Compel 5; is deficient on its face and fails as a matter of law. It is “well established
in this Circuit that plaintiffs could bring claims for breaches of fiduciary duty in ERISA cases.”
Jones v. Allen, No. 2:11-CV-380 (S.D. Ohio Mar. 21, 2014) (emphasis added). Scott-Warren
attempts to manipulate this precedent into standing for the proposition that “disgorgement”
claims may be brought and are commonplace in this Circuit. See Resp. 6. Disgorgement is not a
cause of action under 29 U.S.C. § 1132(a)(3), rather, disgorgement is a potential remedy. See
Rochow v. Life Ins. Co. of N. Am., 780 F.3d 364, 371 (6th Cir. 2015); Varity Corp. v. Howe, 516
U.S. 489, 512 – 515 (1996); see also Gluc v. The Prudential Ins. Co. of Am., No. 3:14-CV-519DJH-DW (W.D. Ky. Oct. 22, 2015); Hackney v. The Lincoln Nat'l Life Ins. Co., No. 3:11-CV268-TBR, (W.D. Ky. Aug. 12, 2014).

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Absent a valid claim under 29 U.S.C. § 1132(a)(3), Scott-Warren cannot seek an
equitable remedy under that section. Therefore, there can be no genuine issue of material fact
concerning her disgorgement claim. The Court will grant Liberty’s motion for summary
judgment on Scott-Warren’s disgorgement claim under 29 U.S.C. § 1129(a)(3).
2. Fed. R. Civ. P. 56(d) Objection
Scott-Warren requests that the Court deny or defer Liberty’s motion for summary
judgment to allow her more time to compile additional discovery. Additional discovery would
not cure Scott-Warren’s insufficient pleading. Moreover, Scott-Warren’s response and her
counsel’s attached declaration do not set forth any indicia of additional facts that discovery
would uncover that would create a genuine issue of material fact concerning the relevant claim.
The Court denies Scott-Warren’s request.
Conclusion
Accordingly, and the Court being sufficiently advised, IT IS HEREBY ORDERED
AND ADJUDGED that that Defendant Liberty Life Assurance Company of Boston’s motion for
partial summary judgment on Scott-Warren’s disgorgement claim under 29 U.S.C. § 1129(a)(3)
(DN 20) is GRANTED.
IT IS SO ORDERED.

February 19, 2016

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