LEWIS-BURROUGHS v. THE PRUDENTIAL INSURANCE COMPANY OF AMERICA et al

Filing 22

OPINION. Signed by Judge Kevin McNulty on 4/30/2015. (anr)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
TRACEE LEWIS-BURROUGHS,
Civ. No. 14-cv-1632 (KM)

Plaintiff,
V.

OPINION
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA, SAINT
BARNABAS HEALTH CARE SYSTEM
HEALTH PLAN, A/K/A “A PLAN OF
OUR OWN”,
Defendants.
KEVIN MCNULTY, U.S.D.J.:
The plaintiff, Tracee Lewis-Burroughs, brings this action to recover longterm disability benefits under an employee welfare benefits plan. The plan is
covered by the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C.
1001 et seq. Currently before the Court is the motion of the defendant, the
Prudential Insurance Company (“Prudential”), to dismiss the Complaint under
Federal Rule of Civil Procedure 12(b)(6) for failure to exhaust administrative
remedies. For the reasons set forth below, the motion is denied.
I.

1
BACKGROUND
Lewis-Burroughs was a nurse at Newark Beth-Israel Medical Center. In

2010, she began to suffer from a host of ailments, including Sjogren’s
Syndrome, systemic lupus, fibromyalgia, polyarthopathy, and Raynaud’s
Syndrome. (Compl., Dkt. No. 1, ¶25) These conditions, she says, caused
extensive pain, joint swelling, muscle weakness, headaches, and cognitive
decline. (Id. ¶27) By February 2011, she had become too ill to ably and safely
perform her duties as a nurse. (Id.)
For purposes of this Rule 12(b)(6) motion to dismiss, the allegations of the
Complaint are taken as true.
1

§

Lewis-Burroughs is a participant in A Plan of Our Own, an emplo
yee
welfare benefit plan governed by ERISA (the “Plan”). The Plan offers
long-term
disability (“LTD”) benefits through Group Plan G-49990-NJ,
a policy issued
by Prudential. Under the Plan, Prudential is the insurer of benefit
s as well as
the administrator of claims. (Id. ¶29)
To receive LTD benefits, a plan-holder must qualify as “disabled.”
That
means that Prudential must determine that the plan-holder (i) is unable
to
perform the material and substantial duties of her regular employment
due to
sickness or injury (ii) under the regular care of a doctor, and (iii) has
experienced a loss in weekly earnings of 20% or more due to her sickne
ss or
injury. (Id. ¶32) A plan holder who meets those disability criteria is
entitled to
receive LTD benefits for up to 24 months. After that, the eligibility require
ments
are stiffer. To receive LTD benefits beyond the initial 24-month period
, the plan
holder must demonstrate, inter alia, that as a result of the same sickness
or
injury she is unable to perform the duties of any gainful occupation for which
she is reasonably qualified. (Id. ¶33)
In August 2011, Lewis-Burroughs applied for LTD benefits. (Id. ¶43)
Prudential approved her claim on August 11, 2011. (Id. ¶44) On November
9,
2012, Prudential sent Lewis-Burroughs a letter stating that it had reviewed her
medical records and determined that she has “the capacity to work at a gainfu
l
occupation.” (Dkt. No. 9-2, at 1; see Compl. ¶52) Accordingly, the letter
concluded that she would be ineligible to receive LTD benefits after Augus
t 13,
2013—the day her initial 24-month benefits period would expire. (Dkt. No. 9-2,
at 2) On January 8, 2013, Lewis-Burroughs filed a letter appeal of that
determination. (Dkt. No. 9-2, at 6; see Compl. ¶56) On June 17, 2013,
Prudential sent another letter that formally closed her disability claim. (Dkt.
No. 9-2, at 9; see Compl. ¶62) This letter reiterated that Prudential had
determined that no benefits were payable to Lewis-Burroughs beyond Augus
t
13, 2013. It also advised her that she had 180 days to appeal the decisio
n.

2

On December 12, 2013, Lewis-Burroughs timely filed an appeal with
supporting documentation. (Compl. ¶66; Dkt. No. 9-2, at 17)
On January 15, 2014, Lewis-Burroughs submitted an additional
document: a Functional Capacities Evaluation that evaluated her
capacity to
perform work activities related to her employment. (Id. ¶67; see also
Dkt. No. 9at 72) Prudential had not specifically requested this document or otherw
2,
ise
indicated that it was necessary to decide the appeal.
The Plan requires that appeals of the denial of benefits be decided
according to a strict schedule that generally sets an outside limit of 90 days:
Prudential shall make a determination on your claim appeal within
45 days of the receipt of your appeal request. This period may be
extended by up to an additional 45 days if Prudential determines
that special circumstances require an extension of time. A written
notice of the extension, the reason for the extension and the date
that Prudential expects to render a decision shall be furnished to
you within the initial 45-day period. However, if the period of time
is extend due to your failure to submit information necessary to
decide the appeal, the period for making the benefit determination
will be tolled (i.e. suspended) from the date on which the
notification of the extension is sent to you until the date on which
you respond to the request for additional information. (Dkt. No. 92, at 118)
The Plan’s procedures regarding the timeliness of appeal decisions are
designed to comply with regulations promulgated by the Department of Labor.
The relevant regulation is 29 C.F.C.

§

2560.503-1, which provides:

[T]he plan administrator shall notify a claimant in accordance with
paragraph U) of this section of the plans benefit determination on
review within a reasonable period of time, but not later than [45j
days after receipt of the claimants request for review by the plan,
unless
the
plan
administrator
determines
that
special
circumstances (such as the need to hold a hearing, if the plans
procedures provide for a hearing) require an extension of time for
processing the claim. If the plan administrator determines that an
extension of time for processing is required, written notice of the
extension shall be furnished to the claimant prior to the
termination of the initial [451—day period. In no event shall such
3

extension exceed a period of [45] days from the end of the initial
period. The extension notice shall indicate the special
circumstances requiring an extension of time and the date by
which the plan expects to render the determination on review.
For purposes of. this section, the period of time within which a
benefit determination on review is required to be made shall begin
at the time an appeal is filed in accordance with the reasonable
procedures of a plan, without regard to whether all the information
necessary to make a benefit determination on review accompanies
the filing. In the event that a period of time is extended... due to a
claimants failure to submit information necessary to decide a
claim, the period for making the benefit determination on review
shall be tolled from the date on which the notification of the
extension is sent to the claimant until the date on which the
claimant responds to the request for additional information.
. .

29 C.F.R.

§ 2560.503-1(i).

Lewis-Burroughs contends, based on the Plan and Regulations, that
Prudential was required to decide her appeal by March 12, 20 14—90 days after
it first received her appeal request. Prudential disagrees. In a letter dated
February 28, 2014, it stated that because Lewis-Burroughs had unilaterally
supplemented her appeal with additional documents on January 15, 2014, the
90-day period was reset and began running from that day. (Compl.

¶ 69; see

Dkt. No. 9-2, at 72) As Prudential saw it, the deadline to decide the appeal was
therefore April 14, 2014. (Id.)
Lewis-Burroughs did not wait until April 14, 2014. On March 13, 2014—
91 days after she first submitted her appeal—she filed this action pursuant to
ERISA

§ 502(a)(1)(b), 29 U.S.C. § 1 132(a)(1)(b). The sole count of her Complaint

alleges that since August 13, 2013—the last day of her initial 24-month
benefits period—Prudential has wrongfully failed to pay her the LTD benefits to
which she is entitled under the Plan.
Prudential filed this motion to dismiss on May 12, 2014. Prudential
asserts that Lewis-Burroughs cannot state a claim under Federal Rule of Civil
Procedure 12(b)(6) because she failed to exhaust her administrative remedies. I
4

have considered this as a motion to dismiss, and also considered the evidence
proffered by Prudential as if this were a summary judgment motion. Either
way, the complaint survives.
II.

LEGAL STANDARDS
1.

Rule 12(b)(6) Motion

Federal Rule of Civil Procedure 12(b)(6)provides for the dismissal
of a complaint, in whole or in part, if it fails to state a claim upon which
relief can be granted. The moving party bears the burden of showing
that no claim has been stated. Hedges v. United States, 404 F.3d 744,
750 (3d Cir. 2005). For the purposes of a motion to dismiss, the facts
alleged in the complaint are accepted as true and all reasonable
inferences are drawn in favor of the plaintiff or counterclaimant. Phillzps
v. County of Allegheny, 515 F.3d 224, 231 (3d Cir. 2008) (stating that
well-established “reasonable inferences” principle is not undermined
by intervening Supreme Court case law).
Although a complaint need not contain detailed factual allegations, “a
plaintiffs obligation to provide the grounds of his entitlement to relief requires
more than labels and conclusions.” Bell Ati. Corp. v. Twombly, 550 U.S. 544,
555 (2007) (internal quotations omitted). The factual allegations must be
sufficient to raise a plaintiff’s right to relief beyond the merely speculative level
to demonstrate that the claim is “plausible on its face.” Id. at 570; see also
Umland v. PLANCO Fin. Servs., Inc., 542 F.3d 59, 64 (3d Cir. 2008). This
requires the plaintiff to plead “factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556).
While this “plausibility standard” does not amount to a “probability
requirement,” it does ask for “more than a sheer possibility.” Iqbal, 556 U.S. at
678. Stated differently, in reviewing the well-pleaded factual allegations and

5

assuming their veracity, this Court must “determine whether they plausibly
give rise to an entitlement to relief.” Iqbal, 556 U.S. at 679.
Much ink has been spilt on the issue of whether, under ERISA,
exhaustion of administrative remedies is a jurisdictional prerequisite (which
must be adequately pled in the complaint) or a non-jurisdictional affirmative
defense (as to which defendant has the burden). In Metro Life Ins. Co. v. Price,
501 F.3d 271 (3d Cir. 2007), the Third Circuit squarely held that because the
ERISA exhaustion was judicially created, it is a “nonjurisdictional affirmative
defense.” Id. at 280. Although several earlier Third Circuit cases had called the
ERISA exhaustion requirement “jurisdictional,” they did so without analysis,
and Metro Life set them aside. Id. at 279—80.
That being the case, a plaintiff “is not required to plead facts showing
that Ishel exhausted [her] remedies.” Id. at *3 Deblasio v. Cent. Metals, Inc., No.
1:13-CV-5282 NLH/AMD, 2014 WL 2919557 (D.N.J. June 27, 2014) (Hillman,
J.). Here, however, Lewis-Burroughs has pleaded that she “has exhausted all
administrative remedies under the Plan’s claims procedure.” (Compi.

¶J

15, 68)

And her complaint pleads many facts on which she bases her claim that,
because Prudential did not timely decide her appeal, she may be deemed to
have exhausted her remedies.
Post-Metro Life, cases in this district have continued to consider
exhaustion arguments in connection with motions to dismiss. The explanation
2
may be that, although a plaintiff is not required to plead facts in support of

See, e.g., Schweikert v. Boxter Healthcare Corp., No. CIV.A. 12-5876 FLW, 2013
WL 1966114, at *4 (D.N.J. May 10, 2013) (plaintiff failed to show that pursuit of
administrative claim would have been futile); Guariglia v. Local 464A United Food &
Commercial Workers Union Wefare Serv. Bert. Fund, No. CIV.A. 13-01110 SDW, 2013
WL 6188510, at *3 (D.N.J. Nov. 25, 2013) (granting a motion to dismiss where plaintif
failed to argue that she pursued an administrative appeal at all); Van Doren u. Capital
Research & Mgmt. Co., No. CIV.A. 10-1425 KSH, 2010 WL 5466839, at *6 (D.N.J. Dec.
30, 2010) (granting a motion to dismiss based on failure to exhaust administrative
remedies); Dupont u. Sklarsky, No. CIV A 08-1724 (JAP), 2009 WL 776947, at *11
(D.N.J. Mar. 20, 2009) (deciding a motion to dismiss based on ERISA exhaustion).
2

6

exhaustion, the facts that are pled may be considered if they definitively
establish that remedies were not exhausted.
I will therefore examine the face of the complaint to determine whether,
as Prudential claims, it conclusively establishes that Lewis-Burroughs failed to
exhaust administrative remedies.
2.

Exhibits proffered by Prudential as to exhaustion of
administrative remedies

Defendant Prudential has submitted six exhibits in connection with its
Rule 12(b)(6) motion. They are:
Ex. A-Letter from Prudential to Lewis-Burroughs, dated November 9,
2012, informing her that her benefits would expire on August 13,
2013. (Dkt. No. 9-2, at 1)
Ex. B-Lewis Burroughs’s letter appeal of Ex. A denial, dated January 8,
2013. (Dkt. No. 9-2, at 5)
Ex. C-Letter from Prudential to Lewis-Burroughs, dated June 17, 2013,
reiterating Ex. A and stating that Prudential had “closed the claim”
as of August 13, 2013. (Dkt. No. 9-2, at 8)
Ex. D-Lewis-Burroughs’s appeal from the denial of benefits (see Ex. C),
submitted December 12, 2013. (Dkt. No. 9-2, at 16)
Ex. E-Letter from Prudential to Lewis-Burroughs, dated February 28,
2014, stating that Prudential regards her appeal as “complete” as
of January 15, 2014, when she submitted the Functional
Capacities Evaluation, and calculating the 90-day deadline as
running from that date. (Dkt. No. 9-2, at 71)
Ex. F-Long Term Disability Plan. (Dkt. No. 9-2, at 73)
Documents integral to or relied upon in a complaint may of course be
considered on a Rule 12(b)(6) motion, even if they are not literally attached. See
Schmidt v. Skolas, 770 F.3d 241, 249 (3d Cir. 2014) (“However, an exception to
the general rule is that a ‘document integral to or explicitly relied upon in the
complaint’ may be considered ‘without converting the motion to dismiss into
one for summary judgment.’

“)

(quoting In re Burlington Coat Factory Sec. Litig.,

114 F.3d 1410, 1426 (3d Cir.l997)); Pension Ben. Guar. Corp. u. White Consol.
7

Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993) ([A] court may consider an

undisputedly authentic document that a defendant attaches as an exhibit to a
motion to dismiss if the plaintiffs claims are based on the document.’) I find
3
that these documentary exhibits are integral to the complaint. The complaint
specifically alleges the denials and appeals embodied in Exhibits A, B, C, D,
and E (Compi.

¶‘J

52, 56, 62, 66, 69). The terms of Exhibit F, the Plan itself,

permeate the Complaint. I have therefore considered these exhibits in
connection with the Rule 12(b)(6) motion.

Alternatively, a court faced by such a proffer has the option to convert the
motion to one for summary judgment.
(d) Result of Presenting Matters Outside the Pleadings. If, on a
motion under Rule 12(b)(6) or 12(c), matters outside the pleadings are
presented to and not excluded by the court, the motion must be treated
as one for summary judgment under Rule 56. All parties must be given a
reasonable opportunity to present all the material that is pertinent to the
motion.

Fed. R. Civ. P. 12(d). I do not choose to do so at this early stage. See Deblasio, supra
(declining to convert motion to dismiss to a summary judgment motion where
defendant argued failure to exhaust administrative remedies in ERISA case); but see
Ruiz v. Campbell Soup Co., No. CIV. 13-2634 NLH JS, 2013 WL 6858787, at *4 (D.N.J.
Dec. 30, 2013) (converting to summary judgment where plaintiff himself had proffered
the additional documents, but giving both parties the opportunity to submit additional
evidence).

8

III.

ANALYSIS

An ERISA plan participant has the right to bring a civil action “to recover
benefits due to [her] under the terms of [her] plan, to enforce [her] rights under
the terms of the plan, or to clarify [her] future benefits under the terms of the
plan.” ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). A federal court will
generally refuse to consider claims to enforce the terms of a benefit plan if the
plaintiff has not first exhausted the remedies available under the plan. See
Welclon v. Kraft, Inc., 896 F.2d 793, 800 (3d Cir. 1990). Those remedies include
an administrative appeal; after the appeal is denied, the plan participant may
seek review by filing a district court action.

That exhaustion requirement is waived, however, when the participant
has filed an administrative appeal from the denial of benefits, but the plan
provider has failed to timely decide it. See Mass. Mut. Life Ins. Co. v. Russel,
473 U.S. 134, 144 (1985). If the deadline to decide an appeal passes without a
decision, the plan participant’s claim is “deemed denied” and her
administrative remedies are presumed exhausted. Russel, 473 U.S. at 144; see
also 29 C.F.R. § 2560.503-1(1) (“In the case of the failure of a plan to... follow
claims procedures consistent with the [timeliness] requirements of this section,
a claimant shall be deemed to have exhausted the administrative remedies
available under the plan and shall be entitled to pursue any available remedies
under section 502(a) of the Act.”) Accordingly, if a plan participant’s appeal is
not decided timely, she may bring a civil action. Lewis-Burroughs says that is
what she has done here.

Did Prudential blow the deadline to decide Lewis-Burroughs’s appeal?
That depends on whether Lewis-Burroughs’s supplemental submission on
January 15, 2015, restarted the 90-day clock. If it did, as Prudential contends,
then the Complaint was filed prematurely and must be dismissed for failure to
exhaust administrative remedies. If it did not restart the clock, as Lewis
9

Burroughs contends, then the appeal is deemed denied and the action is
properly before this Court.

The parties are bound by the appeal process set forth in the Plan. See
Heimeshoffv. Hartford Life & Accident Ins. Co., 134 S.Ct. 604, 612 (2013)
(recognizing “the particular importance of enforcing plan terms as written in

§

502(a)(1)(B) claims”). The Plan states that Prudential “shall” decide an appeal
no later than 90 days after “the receipt of [the plan holder’s] appeal request.”
(Dkt. No. 9-2, at 118) There is no dispute that Prudential received LewisBurroughs’s appeal on December 12, 2013. Therefore, the 90-day period
started running on that day. This literal reading of the Plan is strongly
supported by 29 C.F.R.

§ 2560.503-1(i), which expressly states that the

deadline for deciding an appeal begins when the “appeal is filed”... “without
regard to whether all the information necessary to make a benefit
determination on review accompanies the filing.” 29 C.F’.R.

§ 2560.503-1(i)(4)

(emphasis added). The question whether Lewis-Burroughs’s appeal contained
“all the information necessary” for Prudential to reach a decision is therefore
irrelevant; the date of filing controls.
Prudential counters that both the Plan and 29 C.F.R.

§ 2560.503-1(i)

allow for the tolling of the 90-day deadline if the plan holder supplements her
appeal with additional materials. Therefore, argues Prudential, the deadline to
decide Lewis-Burroughs’s appeal was “tolled” until it received her January 15,
2014 submission. (Motion to Dismiss, Dkt. No. 9-3, at 11) As a result, it says,
the 90-day deadline did not begin to run until that day, and consequently did
not end until April 14, 2014. (Id.)

These tolling provisions do not operate in the manner depicted by
Prudential. The Plan provides that Prudential must decide an appeal within 45
days unless it determines that “special circumstances’ require an additional
45-day extension of time. (Dkt. No. 9-2, at 118) In order to invoke this
10

extension, Prudential must send “[a] written notice of the extension” which
contains “the reason for the extension and the date that [it] expects to render a
decision” before the first 45-day period expires. (Id.) If, however, the “reason”
for the extension is that the participant “fail[ed] to submit information
necessary to decide the appeal,” then “the period for making the benefit
determination will be tolled (i.e. suspended) from the date on which the
notification of the extension is sent to [the plan holderl until the date on which
[the plan holder] respond[s] to the request for additional information.” (Id.)
The tolling provision in 29 C.F.R.

§ 2560.503-1(i) is similar. That

regulation states that the plan provider must decide an appeal within 45 days,
or inform the plan holder in writing that it will require an additional 45 days to
reach a decision. The written notice must “indicate the special circumstances
requiring an extension of time and the date by which the plan expects to render
the determination on review.” 29 C.F.R.

§ 2560.503-1(i)(1). Again, the provision

provides for tolling “in the event that a period of time is extended.., due to a
claimant’s failure to submit information necessary to decide a claim.” In such a
case, “the period for making the benefit determination on review shall be tolled
from the date on which the notification of the extension is sent to the claimant
until the date on which the claimant responds to the request for additional
information.” 29 C.F.R.

§ 2560.503-1(i)(4) (emphasis added).

Tolling, then, cannot be employed as a post hoc justification for delay; it
must be invoked at the time, and certain requirements must be met. Both the
Plan and the Regulation, cited above, impose three pre-conditions on the tolling
of the deadline to decide an appeal: (1) the plan holder must have failed to
provide information “necessary” to the resolution of the appeal; (2) before the
initial 45-day period expires, Prudential must send the participant written
notice that it is claiming the extension; and (3) that notice must list the
“necessary” information that Prudential requires from the participant.

11

Even if these preconditions are met, the 90-day clock does not, as
Prudential suggests, restart from zero when Prudential receives the “necessary”
information from the applicant. Rather, the clock’s running is suspended from
the date that Prudential sends the notification of extension until the date the
plan holder furnishes the “necessary” information. Prudential’s “reset button”
interpretation of tolling finds no support in the Regulation or in the
Plan—which helpfully explains that the period “will be tolled (i.e. suspended).”
(Dkt. No. 9-2, at 118)
Prudential states in its reply brief that it “notified Plaintiff it would need
additional time to conduct the review by sending a ‘written notice of extension’
while the appeal was pending.” Neither the Complaint nor the supplementary
documents submitted by Prudential support that assertion. (Reply Brief, Dkt.
No. 11, at 9-10) Indeed, the evidence submitted by Prudential actually
undercuts its position on the tolling issue. Prudential’s letter of February 28,
2014, states: “Regarding the 45 days and the 90 days, we determined that you
have filed a complete appeal as of January 15, 2014 upon your submission of
the Functional Capacities Evaluation.” (Dkt. No. 9-1, at 72)
Neither the Plan nor the Regulation permits that kind of unilateral,
retroactive deeming. The premise of the entire tolling scheme is that an appeal
is filed; some number of days run (let’s say 45); Prudential requests “necessary”
information (stopping the running of the clock); the applicant then supplies the
information (resuming the running of the clock); and then the 45 days
remaining on the clock run. By definition, the date on which the plan provider
receives the information cannot be the date upon which the appeal was “filed.”
As one court has observed, “[r]estarting Prudential’s clock every time a
claimant submits records would in many situations give Prudential an endless
amount of time to consider appeals and might discourage claimants from
submitting relevant new medical information.” Tomassi v. Prudential Ins. Co. of
America, 2007 WL 1772117, at *4 (N.D. Ill. June 19, 2007). Rather, tolling is a

12

process that Prudential must formally set in motion by requesting documents
“necessary” to the decision of the appeal.
Here, there is no indication that Prudential ever notified LewisBurroughs that it lacked information “necessary” to the resolution of the
appeal, or that Prudential ever requested an extension because such
“necessary” information was missing. Indeed, without such a demand by
Prudential, there would be no way to define the tolling period.
In short, the record before me does not indicate that the tolling process
was ever triggered at all. Accordingly, I hold that Lewis-Burroughs’s
supplemental submission on January 15, 2015, did not restart the time period
in which Prudential was required to decide her appeal.
Prudential, arguing in the alternative, invokes the “substantial
compliance” doctrine. Prudential stresses that it communicated with LewisBurroughs regarding the status of her claim, acted in good faith, and did not
unreasonably delay the appeal process. Under the circumstances, says
Prudential, its “failure to comply with the regulation deadlines may be
excused.” (Brief, Dkt. No. 11, at 7-8)

The “substantial compliance” doctrine holds that so long as a plan
provider substantially complies with a plan’s procedures, its discretionary
decisions are entitled to deferential review by the courts. In the cases cited by
Prudential, however, the plan provider actually made a decision, if belatedly.
For example, in Topalian v. Hartford Life Ins. Co., 945 F. Supp. 2d. 294, 336
(E.D.N.Y. 2013), the plan provider denied the plaintiff’s administrative appeal
from the denial of LTD benefits, but did not do so until “long after the
regulatory time period set forth under 29 C.F.R. § 2560.503—1(i)(1)(i),
2560.503—1(i)(3)(i).” The plaintiff argued that the provider therefore had
forfeited the right to have a court defer to its exercise of discretion, and sought
13

de novo review. The court, relying on the substantial compliance
doctrine,
rejected plaintiff’s position.
Substantial compliance presents factual issues that I cannot resolve
in
Prudential’s favor on a motion to dismiss. I do observe, however,
4
that
Prudential did not “substantially comply” with its obligation to decide
LewisBurroughs’s appeal. It does not appear that Prudential ever decide
d that appeal
at all. Rather, the appeal was deemed denied because Prudential
had failed to
act.

Prudential would no doubt say that it made a good faith, if erroneous,
effort to determine the deadline, and that its efforts were cut off by Lewis
Burrough’s court filing. I am wary, however, of an interpretation of substa
ntial
compliance that rewards inaction by barring the courthouse door. As courts
in
this district have recognized, “the substantial compliance doctrine may
be
relevant when a claimant challenges an administrator’s decision, but it
is quite
problematic to use it to find, in the absence of a decision, that a claima
nt has
no right to sue.” Ziesemer v. First Unum Life Ins. Co., 2007 WL 2123693, at *5
(D.N.J. July 20, 2007).
The Third Circuit has not decided this issue, but, as Judge Chesler noted
in Ziesemer, the Second Circuit has:
The Second Circuit considered “substantial compliance” in this
context in 2005 in [Nichols u. Pmdential Ins. Co. of America, 406
F.3d 98, 106 (2d Cir. 2005)]. The Court observed that substantial
compliance, as a doctrine that excuses “technical noncompliance
for purposes of review of a plan administrator’s discretionary
decision,” must be differentiated from “the very different question
of whether substantial compliance can block or delay a plaintiffs
access to the federal courts.” Id. at 107. The Nichols Court, facing
I do not consider, for example, defense counsel’s certification, in which he
asserts that he requested from plaintiff’s counsel a voluntary stay pending the
outcome of the appeal, but did not receive it. (Dkt. No. 9-1)
4

14

the latter question, rejected the insurer’s “substantial compliance”
arguments, stating: “adopting the proposition that substantial
compliance can delay accrual of the right to sue would permit plan
administrators to indefinitely tie up claimants, who are often in
immediate need of benefits, with ongoing requests for information.
Such a result would render the plain language of Section
2560.503-1(h)(1) a nullity.” Id.
2007 WL 2123693, at *5• Like Judge Chesler, I find the Second Circuit’s
analysis persuasive. At least in the context of a motion to dismiss, I cannot find
that the substantial compliance doctrine would affect Lewis-Burroughs’s right
to commence this action.
For the foregoing reasons, I find that Prudential has failed to satisfy its
burden of persuasion that no claim has been presented. See Hedges v. United
States, 404 F.3d 744, 750 (3d Cir. 2005) (stating that on a Rule 12(b)(6)
motion, the defendant “bears the burden of showing that no claim has been
presented”). Lewis-Burroughs alleges that Prudential failed to decide her appeal
within the requisite time period, that her claim was deemed denied as a result
of this failure, and that this denial violates her right to receive certain benefits
under the Plan. These allegations plausibly set forth an entitlement to relief (or
rather to seek relief) in this Court.

IV.

CONCLUSION

For the reasons set forth above, Prudential’s motion to dismiss the
Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) is
DENIED. An appropriate order will issue.

KEVIN MCNUL Y, U.S.D.J.

Date: April 30, 2015

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