Kuntz et al v. Prudential Insurance Company of America
Filing
11
Order and Decision. Reviewing the pleadings in a light most favorable to the Plaintiffs, they cannot state a claim for which relief can be granted. Defendant's 6 motion to dismiss is hereby Granted and this case is dismissed without prejudice. Judge John R. Adams on 03/29/2017.(M,TL)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
KEVIN KUNTZ, et al.,
Plaintiffs,
vs.
PRUDENTIAL LIFE INSURANCE
COMPANY OF AMERICA,
Defendant.
)
)
)
)
)
)
)
)
)
)
)
CASE NO. 5:16CV1899
JUDGE JOHN R. ADAMS
ORDER AND DECISION
(Resolving Doc. 6)
This matter is before the Court on a motion to dismiss pursuant to Fed.R.Civ.P. 12 (b)(6)
filed by Defendant Prudential Life Insurance Company of America. Doc. 6. Plaintiffs Kevin
Kuntz and Amy Tracy have filed a brief opposing the motion. After reviewing the Complaint in
a light most favorable to the Plaintiffs, the Court finds that the Plaintiffs’ claims are preempted
by ERISA and that they have failed to exhaust their administrative remedies. Defendant is
entitled to judgment on the pleadings on all claims. As such, this Court hereby GRANTS
Defendant’s motion to dismiss without prejudice.
I. FACTS
The facts in this case as presented in the Complaint are undisputed. Plaintiffs are the son
and daughter of Stanley Kuntz, now deceased. Doc. 1. Prior to his death, Mr. Kuntz worked for
Weirton Steel Corporation, which is now part of Arcelor Mittel. Doc. 1. Mr. Kuntz worked until
2008, when he retired, and he then opted to keep Group Life Insurance coverage with the
Defendant, policy #G-35355, as part of his continuing benefits from his employer. Doc. 1. The
face value of the policy is $10,000, and Plaintiffs’ were designated as his beneficiaries.
On October 14, 2015, Plaintiff Kevin Kuntz notified the Defendant that Mr. Kuntz had
passed away. Plaintiffs then submitted a claim under a different policy – policy #R5219597 –
1
and the Defendant paid them for the claim they submitted under this policy. However, Plaintiffs
do not dispute that they did not submit a claim form for policy #G-35355. Docs. 1 and 9. In
response to Plaintiffs’ inquiry, Defendant later sent a letter stating:
Your correspondence addressed to Prudential was received in the Group
Life Claim area. We have researched our claim system and are unable to
find a Group Life claim for the above named individual [Stanley Kuntz]. In
addition, Prudential does not maintain eligibility or enrollment records and
therefore must rely on the employer to determine the initial eligibility to the
employee, including coverage amount. If you believe the above named
person had Group Term Life Insurance coverage we suggest you contact the
(former) employer to request a claim be submitted. The benefits office
must verify coverage. Once the death claim is submitted, the claim would
be evaluated to determine if benefits are payable.
Doc. 1-2 at 11. Plaintiffs did not follow up with Mr. Kuntz’s former employer or submit a claim
form. Instead, they filed the underlying action in state court alleging: 1) intentional interference
with expectancy of inheritance; 2) breach of contract; 3) promissory estoppel; 4) unjust
enrichment; 5) breach of good faith and fair dealing; and 6) declaratory judgment. Defendant
filed a motion to dismiss under Fed.R.Civ.P. 12(b)(6) alleging preemption by ERISA and failure
to exhaust administrative remedies. Doc. 6.
II. LEGAL STANDARD AND ANALYSIS
When evaluating a motion to dismiss pursuant to rule 12(b)(6), the factual
allegations in the complaint must be regarded as true. Walker Process
Equipment, Inc. v. Food Machinery & Chemical Corp., 382 U.S. 172, 174–
75, 86 S.Ct. 347, 348–49, 15 L.Ed.2d 247 (1965). The claim should not be
dismissed unless it appears beyond doubt that plaintiff can prove no set of
facts in support of his claim which would entitle him to relief. Conley v.
Gibson, 355 U.S. 41, 45–46, 78 S.Ct. 99, 101–102, 2 L.Ed.2d 80 (1957).
Windsor v. The Tennessean, 719 F.2d 155, 158 (6th Cir.1983). A motion to dismiss under
Fed.R.Civ.P. 12(b)(6) is designed to test the sufficiency of the complaint. Riverview Health
Institute LLC v. Medical Mutual of Ohio, 601 F.3d 505, 512 (6th Cir.2010). When ruling on a
motion to dismiss under Rule 12(b)(6), the Court must construe the Complaint in a light most
2
favorable to the non-moving party. Bloch v. Ribar, 156 F.3d 673, 677 (6th Cir. 1998). “For
purposes of a motion for judgment on the pleadings, all well-pleaded material allegations of the
pleadings of the opposing party must be taken as true, but a court “need not accept as true legal
conclusions or unwarranted factual inferences.” Mixon v. Ohio, 193 F.3d 389, 400 (6th
Cir.1999). “[M]atters of public record, orders, items appearing in the record of the case, and
exhibits attached to the complaint[ ] also may be taken into account.” Amini v. Oberlin Coll., 259
F.3d 493, 502 (6th Cir.2001) (quoting Nieman v. NLO, Inc., 108 F.3d 1546, 1554 (6th Cir.1997))
(emphasis omitted).
A. Preemption under ERISA
In their brief in opposition to the motion to dismiss, the Plaintiffs acknowledge that this
matter involves an employee-related life insurance plan. Therefore, they stipulate that their
state-law claims are preempted by ERISA. The Court agrees and finds that this matter is
governed by ERISA.
B. Exhaustion of administrative remedies
In their brief in opposition to dismissal, Plaintiffs also acknowledge that the Sixth Circuit
Court of Appeals has read into ERISA a requirement that plaintiffs exhaust their administrative
remedies prior to filing a lawsuit. Doc. 9 at 4 (citing Costantino v. TRW Inc., 13 F.3d 969 (6th
Cir. 1994)).
Here, Plaintiffs admit they did not exhaust their administrative remedies by
returning to Mr. Kuntz’s employer and filing a claim for benefits under policy #G-35355.
However, they argue dismissal is not warranted because returning to exhaust their remedies
would be futile. Doc. 9.
“Traditional exhaustion principles, however, include an exception for instances ‘when
resort[ing] to the administrative route is futile or the remedy inadequate.’” Costantino v. TRW,
Inc., 13 F.3d 969, 974 (6th Cir. 1994) (citing Amato v. Bernard, 618 F.2d 559, 568 (9th
3
Cir.1980) (quoting Winterberger v. General Teamsters Auto Truck Drivers & Helpers Local
Union 162, 558 F.2d 923, 925 (9th Cir.1977).
Plaintiffs argue that exhausting their
administrative remedies would be futile because the Defendant has already stated that it could
not find a claim for policy #G-35355. Plaintiffs interpret this letter to mean that the Defendant
“cannot find the policy which Kevin and Amy are beneficiaries of [sic].” Doc. 9 at 6. Therefore,
returning to exhaust their remedies would only lead to the same outcome.
Plaintiffs’ interpretation of the letter is contrary to its plain language. Instead, the letter
states that the Defendant could not find a “Group Life claim” for policy #G-35355. No claim
was found because, admittedly, the Plaintiffs’ did not submit a claim. If the Plaintiffs were to
return to Mr. Kuntz’s employer, submit a claim, and engage in the process as outlined in the
letter, the Defendant may pay the claim for policy #G-35355 – which in turn would resolve all
issues.
As such, the exhaustion of administrative remedies would not be futile, and the
Plaintiffs’ Complaint should be dismissed without prejudice.
III.
CONCLUSION
Reviewing the pleadings in a light most favorable to the Plaintiffs, they cannot state a
claim for which relief can be granted. Defendant’s motion to dismiss is hereby GRANTED, and
the case is DISMISSED WITHOUT PREJUDICE.
IT IS SO ORDERED.
DATE: March 29, 2017
/s/ John R. Adams_________________
Judge John R. Adams
UNITED STATES DISTRICT COURT
4
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?