CLARK v. JANSSEN PHARMACEUTICAL INC et al

Filing 26

ORDER ON MOTION TO DISMISS granting 4 Motion to Dismiss By JUDGE NANCY TORRESEN. (dfr)

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE

MICHELE CLARK,
Plaintiff
v.
JANSSEN PHARMACEUTICAL,
INC., JOHNSON & JOHNSON, THE
REED GROUP, and THE
PRUDENTIAL INSURANCE
COMPANY OF AMERICA,
Defendants

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) Civil No. 1:12-CV-00384-NT
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ORDER ON MOTION TO DISMISS
Before the Court is a motion to dismiss the complaint pursuant to Federal
Rule of Civil Procedure 12(b)(6), by defendants Janssen Pharmaceutical, Inc.,
(“Janssen”), Johnson & Johnson, and the Reed Group, for failure to state a claim
for which relief may be granted. For the reasons that follow, the Court grants the
motion.
BACKGROUND
July 29, 2011, was Plaintiff Michelle Clark’s (the “Plaintiff”) last day of
employment with Janssen Pharmaceutical, a company affiliated with Johnson &
Johnson. Clark Decl. ¶ 2 (ECF No. 12) and Ex. B thereto (ECF No. 12-2) (July 29,
2011 termination letter.) On that day, the Plaintiff applied to the Reed Group,
administrator of her employer’s short term disability and long term disability

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programs, for short term disability benefits because of narcolepsy cataplexy
syndrome. Compl. ¶¶ 6 and 8.
By letter dated August 8, 2011, the Reed Group denied the Plaintiff’s claim
on the basis that the Plaintiff was no longer employed by Johnson & Johnson as of
July 29, 2011. Compl. ¶¶ 8 and 13, Clark Decl. ¶ 3 and Ex. C thereto (ECF No. 12-3)
(August 8, 2011, denial letter.) The Plaintiff appealed this determination, and on
October 6, 2011, the Reed Group once again denied her claim on the same basis.
Compl. ¶¶ 14 and 15, Clark Decl. ¶ 4 and Ex. D thereto (ECF No. 12-4) (October 6,
2011 denial letter.) The Plaintiff, through her attorney, appealed again, and by
letter dated December 19, 2011, Johnson & Johnson denied the Plaintiff’s claim in a
final determination on the basis that
she was not absent from work for seven consecutive calendar days. Her
employment was terminated on July 29, 2011. Even if July 29, 2011
were to be considered Ms. Clark’s first day of absence from work,
termination notwithstanding, she was not absent from work due to a
disabling condition for seven (7) consecutive calendar days, one of the
Plan requirements for claiming STD benefits.
Furthermore, even if Ms. Clark had not been terminated, and
even if she had been absent for greater than seven consecutive
calendar days, there is no objective evidence in the claim file that
supports the presence of a disabling condition that would have
precluded your client from performing the duties of her position as a
Senior Sales Representative.
Ex. E to Clark Decl. 4 (ECF No. 12-5) (December 19, 2011 final determination
denial letter). See also Compl. ¶¶ 16-19 and Clark Decl. ¶ 5. The Plaintiff also
alleges that she repeatedly attempted to apply for long term disability benefits “but
the Reed Group ignored her application.” Compl. ¶ 21.

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On December 19, 2012, the Plaintiff filed a complaint against Janssen, the
Reed Group, Johnson & Johnson, and the Prudential Insurance Company of
America (“Prudential”), the insurer of Johnson & Johnson’s LTD benefits plan.
The complaint alleges four counts against all defendants: Claim for ERISA benefits
(Count I), Breach of Contract (Count II), Breach of Contract and Estoppel Refusal to
Provide Meaningful Appeal Consideration (Count III) and Unfair Claims
Settlement Practices (Count IV).
LEGAL STANDARD
A complaint must contain “a short and plain statement of the claim showing
that the pleader is entitled to relief” and “[e]ach allegation must be simple, concise,
and direct.” Fed.R.Civ.P. 8(a)(2) and 8(d)(1). A motion to dismiss for failure to state
a claim requires the moving party to demonstrate that, drawing all reasonable
inferences in the pleader’s favor, the complaint fails to plausibly narrate a claim for
relief. Schatz v. Republican State Leadership Comm., 669 F.3d 50, 55 (1st Cir.2012).
“Plausible, of course, means something more than merely possible, and gauging a
pleaded situation’s plausibility is a ‘context-specific’ job” that requires the Court to
“‘draw on’ [its] ‘judicial experience and common sense.’” Id. (quoting Ashcroft v.
Iqbal, 556 U.S. 662, 679 (2009)).
“Ordinarily, a court may not consider any documents that are outside of the
complaint, or not expressly incorporated therein, unless the motion is converted into
one for summary judgment.” Alternative Energy, Inc. v. St. Paul Fire & Marine Ins.
Co., 267 F.3d 30, 33 (1st Cir. 2001) (citing Watterson v. Page, 987 F.2d 1, 3 (1st Cir.

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1993)). “There is, however, a narrow exception ‘for documents the authenticity of
which are not disputed by the parties; for official public records; for documents
central to plaintiffs’ claim; or for documents sufficiently referred to in the
complaint.’” Id. (quoting Watterson, 987 F.2d at 3). “When the complaint relies upon
a document, whose authenticity is not challenged, such a document ‘merges into the
pleadings’ and the court may properly consider it under a Rule 12(b)(6) motion to
dismiss.” Alternative Energy, 267 F.3d at 33 (quoting Beddall v. State St. Bank &
Trust Co., 137 F.3d 12, 17 (1st Cir. 1998)).
DISCUSSION
There is a lot on which the Plaintiff and Defendants agree. First, the parties
agree that the Court may consider the following documents on the Plaintiff’s motion
to dismiss: (1) the Choices Disability Insurance Plan and General Administrative
Information,1 (2) the July 29, 2011, termination letter (3) the August 8, 2011, denial
letter, (4) the October 6, 2011, denial letter, and (5) the December 19, 2011, final
determination denial letter. These documents are sufficiently referred to in the
complaint and their authenticity is not challenged. Alternative Energy, 267 F.3d at
33.
The Plaintiff also agrees with the Defendants that Johnson & Johnson’s short
term disability program is not governed by ERISA, Defs’ Mot. to Dismiss 12-13
(ECF No. 4); Pl’s Opp. to Mot. to Dismiss 2 (ECF No. 11), and therefore that Count I
(Claim for ERISA benefits) does not state a claim with respect to short term
disability benefits.
1

Wilkinson Decl. ¶¶ 3-4 (ECF No. 4-1) and Exs. A and B thereto (ECF Nos. 4-2 and 4-3).

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Further, the Plaintiff agrees that neither Janssen, nor Johnson & Johnson,
nor the Reed Group can be held responsible for any determination by Prudential to
deny long term disability benefits. Consequently, Count I may be dismissed as to
Janssen, Johnson & Johnson, and the Reed Group. Pl’s Opp. to Mot. to Dismiss 2.
In addition, the Plaintiff agrees that the Court may dismiss Count III
entirely (Breach of Contract and Estoppel Refusal to Provide Meaningful Appeal
Consideration). Id.
Finally, the Plaintiff agrees that ERISA preempts Counts II-IV with respect
to her claims for long term disability benefits. Id.
In sum, the following claims remain: an ERISA claim against Prudential
(Count I); Breach of Contract for denial of short term disability benefits against
Janssen, Johnson & Johnson, and the Reed Group (Count II); and Unfair Claims
Settlement Practices against Janssen, Johnson & Johnson, and the Reed Group,
with regard to their treatment of her short term disability benefits claim (Count
IV).
The Plaintiff’s breach of contract and unfair claims settlement practices
claims are based on her assertion that Janssen, Johnson & Johnson, and the Reed
Group wrongfully denied her short term disability benefits on the basis that she
was no longer eligible for such benefits as of July 29, 2011, which was her final day
of employment. She also asks that the Defendants be estopped from asserting any
alternative basis for denial, namely, that she did not submit sufficient evidence

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demonstrating that she was disabled, because they did not articulate this as a basis
for denial of short term disability benefits until their final determination letter.
The Court need not reach the Plaintiff’s estoppel argument because, under
the plain terms of the plan, the Plaintiff fails to state a claim for short term
disability benefits or for unfair settlement practices in regard to that claim. The
plan provides in pertinent part:
A Short Term Disability (STD) is an illness or injury . . . that
prevents you from performing the essential functions of your job . . . as
determined by the Service Administrator. . . .
***
If Reed Group approves your disability, STD benefits begin on
your first full day of absence due to a disability if you are unable to
work according to your regularly scheduled hours for more than seven
consecutive calendar days. . . .2
***
Claims must be reported no earlier than 30 days prior to any
known absence, and no later than 30 days after the initial date of
absence. Claims submitted outside of these timeframes will not be
honored.
***
Any benefits under these Plans [short term disability and long
term disability] will end on the date employment ends.
Choices Disability Insurance Plan 4, 6 and 47.
The Court interprets “unambiguous policy language consistent with its plain
meaning and ‘construe[s] ambiguous policy language strictly against the insurance

This provision, which is the more generous of the plan’s short term disability coverages,
applies only to “Choices Eligible Employees.” The Court infers from the allegations in the complaint
that the Plaintiff is a Choices Eligible Employee.
2

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company and liberally in favor of the policyholder.’” Langevin v. Allstate Ins. Co., 66
A.3d 585, 590 (Me. 2013) (quoting Cox v. Commonwealth Land Title Ins. Co., 59
A.3d 1280, 1283 (Me. 2013)). Under these principles of construction, the Plaintiff
must have been unable to work for at least seven consecutive calendar days while
employed with Janssen to be eligible to receive short term disability benefits. The
complaint alleges that the Plaintiff was employed on July 29, 2011, the day she
applied for short term disability.3 But it does not allege that the Plaintiff was
unable to work for at least seven consecutive days while she was employed. Because
the complaint fails to allege facts that are essential to the Plaintiff’s claim for short
term disability benefits, it fails to state claims against Janssen, Johnson & Johnson,
or the Reed Group for which relief may be granted.4
For the foregoing reasons, the Court GRANTS the motion to dismiss. Counts
II, III, and IV are hereby DISMISSED, and Count I is DISMISSED as to
Defendants Janssen, Johnson & Johnson, and the Reed Group.
SO ORDERED.
/s/ Nancy Torresen
United States District Judge
Dated this 10th day of February, 2014.
The plan allows eligible employees to apply for short term disability benefits up to thirty
days after the initial date of absence. Thus, it is not material whether the Plaintiff was actively
employed by Janssen on the date she applied for benefits. Rather, it is only necessary that any
benefits for which the Plaintiff applied related to a short-term disability that she experienced while
employed.
4
In her opposition to the motion to dismiss, the Plaintiff requested leave to amend her
complaint, but only “[t]o the extent that the Complaint fails to adequately allege that the Plans are a
contract with Ms. Clark . . . .” Pl’s Opp. to Mot. to Dismiss 5. The Plaintiff’s opposition was written
with the benefit of access to the plan’s terms, but did not request leave to amend to include factual
allegations regarding the Plaintiff’s inability to work between June 29, 2011, and August 4, 2011.
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