Perkins v. US Airways Inc et al

Filing 36

ORDER granting in part and denying in part 24 Motion to Dismiss for Failure to State a Claim. Signed by Honorable Bruce Howe Hendricks on 9/30/15.(alew, )

UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH CAROLINA
GREENVILLE DIVISION

Jennifer Perkins,

) Civil Action No.: 6:14-CV-2577-BHH
)
Plaintiff, )
vs.
)
)
Opinion and Order
US Airways, Inc.; U.S. Airways Group;
)
American Airlines Group, successor by
)
merger with US Airways, Inc.; and US
)
Airways Health Benefit Plan,
)
)
Defendants. )
_________________________________ )
This matter is before the Court on the defendants’ motion to dismiss the plaintiff’s
complaint for failure to state a claim upon which relief can be granted. (ECF No. 24.) For
the reasons set forth in this order, the defendants’ motion is granted in part and denied
in part.
BACKGROUND
By way of her complaint filed June 24, 2014, plaintiff Jennifer Perkins (“plaintiff”
or “Perkins”) challenges defendants’ (US Airways, Inc., U.S. Airways Group, Inc.,
American Airlines Group, Inc., and US Airways Health Benefit Plan, collectively,
“defendants” or “US Airways”) denial of her claims for medical benefits under the
Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq.,
and the Medicare Secondary Payer Act, 42 U.S.C. § 1395y(b)(3)(A). The plaintiff also
contends that US Airways failed to explain the reasons for the denial, in violation of the
procedural requirements of ERISA, 29 U.S.C. § 1133(2), and did not provide her with

1

requested documents, for which she claims the company is subject to a penalty under
ERISA, 29 U.S.C. § 1132(c)(1).
According to the complaint, the plaintiff is a participant in the US Airways Health
Benefit Plan (the “Plan”). (Compl. ¶¶ 7, 10, ECF No. 1.) The Plan is a welfare benefit
plan as defined by ERISA, 29 U.S.C. § 1132(d)(1). (Id. ¶ 7.) Defendant US Airways,
Inc., was at all relevant times the plan administrator. (Id. ¶ 8.)
On May 10, 2000, the plaintiff was struck by lightning while working as a flight
attendant for US Airways. (Id. ¶¶ 1, 17.) Since that time she has suffered from a variety
of medical issues. (See id. ¶ 1.) On or about October 2, 2001, US Airways granted the
plaintiff an approved medical leave of absence due to her physical inability to perform
her duties. (Id. ¶¶ 1, 18.) On February 20, 2002, the plaintiff began receiving long-term
disability benefits from US Airways, retroactive to October 2, 2001, the day her leave of
absence was granted. (Id. ¶ 24.) She was continuing to receive those benefits at the
time the complaint was filed. (Id.) On September 1, 2003, the plaintiff also began
receiving Medicare. (Id. ¶ 30.) As an employee on a medical leave of absence, the
plaintiff remains employed by US Airways (Id. ¶ 19-20), and retains her right to return to
active employment (Id. ¶¶ 21-22).
In 2011, the Plan denied the plaintiff coverage for benefit claims totaling $10,848
on the ground that Medicare, rather than the Plan, was the primary provider for those
claims. (Id. ¶¶ 41, 43.) The plaintiff appealed that denial on July 26, 2011, and again on
December 15, 2011. (Id. ¶ 42.) On August 23, 2012, US Airways denied the plaintiff’s
second, final appeal via a “Notice of Final Internal Adverse Benefit Determination.” (Id. ¶
43.)

2

The first relevant version of the US Airways Health Benefit Plan has an effective
date of January 1, 1992 (“1992 Plan”). (Mot. to Dismiss, Ex. B, ECF No. 24-4 at 26.)
Section 4.5, entitled “Coordination With Medicare,” states in pertinent part:
When a Participant is eligible for Medicare, this Plan will pay first for:
(a) an active Employee who is age 65 or over;
(b) an active Employee’s spouse Dependent age 65 and over;
(c) an active Employee’s disabled Dependent under age 65; or
(d) the first 12 consecutive months of treatment for end stage renal
disease received by any Participant.
If these rules do not apply, this Plan will pay benefits only after Medicare
has paid its benefits; provided, however, that the Plan will only pay
benefits before or after Medicare has paid benefits, as applicable, if the
Participant has enrolled for Medicare Parts A and B.
(Ex. B, ECF No. 24-4 at 17) (emphasis added). Section 4.5 of the 1992 Plan was
amended with an effective date of January 1, 2003 (“2003 Amendment”). (Ex. B, ECF
No. 24-4 at 55.) As amended, section 4.5 reads in pertinent part:
When a Participant or his Dependent is eligible for Medicare, this Plan will
pay first for:
(a) an active Employee who is age 65 or over;
(b) an active Employee’s Dependent age 65 and over;
(c) an active Employee’s disabled Dependent under age 65; or
(d) the first 30-month period of treatment for end stage renal
disease received by any Participant, beginning with the first month
in which the Participant becomes entitled to Medicare or, if earlier,
the first month that the Participant would have been entitled to
Medicare had an application been filed for such benefits.
If the above rules do not apply, this Plan will pay benefits only after
Medicare has paid its benefits; provided, however, that the Plan will only
pay benefits before or after Medicare has paid benefits, as applicable, if
the Participant and Dependent spouse have enrolled for Medicare Parts A
and B. If a Participant’s Dependent spouse becomes eligible for Medicare
prior to the Participant, this Plan will pay benefits for the Dependent
spouse after Medicare has paid its benefits, provided the Dependent
spouse has enrolled for Medicare Parts A and B.

3

(Ex. B, ECF No. 24-4 at 51) (emphasis added).
The relevant Summary Plan Description of the US Airways Health Benefit Plan
has an effective date of January 1, 1993 (“1993 SPD”). (Mot. to Dismiss, Ex. D, ECF
No. 25-1 at 7.) The section entitled “Effect of Medicare on the Plan” states in pertinent
part:
The USAir, Inc. Health Benefit Plan pays after Medicare for:
• Retired Employees and their Dependents eligible for Medicare.
• Covered persons eligible for Medicare due to disability if either of the
following apply:
• The covered person is not an “active individual” as defined by federal
law and determined by your employer.
• This Plan is not a “large group health plan” as defined by federal law
and determined by your employer.
• Covered persons eligible for Medicare due to end stage renal disease,
but only after the first 18 months of entitlement to Medicare benefits due to
end stage renal disease.
(Ex. D, ECF No. 25-1 at 122) (emphasis added). The relevant Summary of Material
Modifications has an effective date of January 1, 2011 (“2011 SMM”). (Mot. to Dismiss,
Ex. C, ECF No. 24-5 at 2.) In pertinent part, the section entitled “Coordination with
Medicare for Disabled Individuals” states:
If you or your covered dependent(s) are enrolled in Medicare while you
are actively employed, participation in this Plan will continue as long as
you are an active employee and remain enrolled. This Plan will be the
primary carrier and Medicare will be the secondary carrier.
If you are on a leave of absence or you are receiving disability benefits,
please note the following important rules regarding coverage under
Medicare:
Leave of Absence: If you take a leave of absence and retain coverage
under the Plan, the Plan will continue to pay primary for as long as you
retain your right to return to active employment, i.e., your employment is
not terminated by the company. If your employment is terminated by the
company, Medicare will become primary.

4

Disability: If you take a medical leave of absence, retain coverage under
the Plan, and start receiving disability benefits from the company, the Plan
will continue to pay primary for the first 6 months of your disability
coverage, i.e., while disability benefits are subject to FICA tax. After this 6
month period, Medicare will become primary for you and/or any covered
dependents.
When Medicare becomes primary, the Plan assumes you are enrolled in
both Medicare Part A and B, so review your options when you become
eligible for Medicare (either due to age or disability).
If you have questions about Medicare benefits, contact your local Social
Security office.
(Ex. C, ECF No. 24-5 at 8) (emphasis added).
The current version of the US Airways Health Benefit Plan has an effective date
of January 1, 2013 (“2013 Plan”). (Mot. to Dismiss, Ex. A, ECF No. 24-3 at 2.) Section
4.5, entitled “Coordination with Medicare,” states in pertinent part:
If an Employee is on a leave of absence or receiving disability benefits,
the following rules regarding coverage under Medicare apply:
(a) Leave of Absence: If an Employee takes a leave of absence and
retains coverage under the Plan, the Plan will continue to pay primary
for as long as the active Employee retains the right to return to active
employment, (i.e., the active Employee’s employment is not
terminated by the Company). If the active Employee’s employment is
terminated by the company, Medicare will become primary.
(b) Disability: If an Employee takes a medical leave of absence,
retains coverage under the Plan, and starts receiving disability
benefits from the Company, even if he or she is still on leave of
absence and retains his or her right to return to active employment,
the Plan will continue to pay primary for the first 6 months of disability
coverage, (i.e., while disability benefits are subject to FICA tax). After
this 6 month period, Medicare will become primary.
(Ex. A, ECF No. 24-3 at 17) (emphasis added).
The defendants filed a motion to dismiss the plaintiff’s complaint for failure to
state a claim on September 18, 2014. (ECF No. 24.) The plaintiff filed a response in

5

opposition to the motion (ECF No. 28) on October 16, 2014, and the defendants filed
their reply on October 27, 2014 (ECF No. 29).
STANDARD OF REVIEW
A plaintiff’s complaint should set forth “a short and plain statement . . . showing
that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Rule 8 “does not require
‘detailed factual allegations,’ but it demands more than an unadorned, the-defendantunlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “To survive a motion to dismiss,
a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to
relief that is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570)). “A claim has
facial plausibility when the plaintiff pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the misconduct alleged.” Id.
(quoting Twombly, 550 U.S. at 556)). In considering a motion to dismiss under
Fed.R.Civ.P. 12(b)(6), a court “accepts all well-pled facts as true and construes these
facts in the light most favorable to the plaintiff . . . .” Nemet Chevrolet, Ltd. v.
Consumeraffairs.com, Inc., 591 F.3d 250, 255 (4th Cir. 2009). A court should grant a
Rule 12(b)(6) motion if, “after accepting all well-pleaded allegations in the plaintiff’s
complaint as true and drawing all reasonable factual inferences from those facts in the
plaintiff’s favor, it appears certain that the plaintiff cannot prove any set of facts in
support of his claim entitling him to relief.” Edwards v. City of Goldsboro, 178 F.3d 231,
244 (4th Cir. 1999).
As previously noted, to survive a Rule 12(b)(6) motion to dismiss a complaint
must state “a plausible claim for relief.” Iqbal, 556 U.S. at 679 (emphasis added). “The

6

plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a
sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts
that are ‘merely consistent with’ a defendant’s liability, it ‘stops short of the line between
possibility and plausibility of entitlement to relief.’” Id. at 678 (quoting Twombly, 550 U.S.
at 557). Stated differently, “where the well-pleaded facts do not permit the court to infer
more than the mere possibility of misconduct, the complaint has alleged—but it has not
‘show[n]’—‘that the pleader is entitled to relief.’” Id. at 679 (quoting Fed.R.Civ.P.
8(a)(2)). Still, Rule 12(b)(6) “does not countenance . . . dismissals based on a judge’s
disbelief of a complaint’s factual allegations.” Colon Health Centers of Am., LLC v.
Hazel, 733 F.3d 535, 545 (4th Cir. 2013) (quoting Neitzke v. Williams, 490 U.S. 319,
327 (1989)). “A plausible but inconclusive inference from pleaded facts will survive a
motion to dismiss . . . .” Sepulveda-Villarini v. Dep’t of Educ. of Puerto Rico, 628 F.3d
25, 30 (1st Cir. 2010).
Generally, “[when] resolving a motion pursuant to Rule 12(b)(6) . . . , a district
court cannot consider matters outside the pleadings without converting the motion into
one for summary judgment.” Occupy Columbia v. Haley, 738 F.3d 107, 116 (4th Cir.
2013). However, “when a plaintiff fails to introduce a pertinent document as part of his
complaint, the defendant may attach the document to a motion to dismiss the complaint
and the [c]ourt may consider the same without converting the motion to one for
summary judgment.” Gasner v. Cnty. of Dinwiddie, 162 F.R.D. 280, 282 (E.D. Va.
1995), aff’d, 103 F.3d 351 (4th Cir. 1996) (citing 5 Charles A. Wright & Arthur R. Miller,
Federal Practice and Procedure: Civil, § 1327, at 762-63 (2d ed. 1990)); accord Philips
v. Pitt Cnty. Mem’l Hosp., 572 F.3d 176, 180 (4th Cir. 2009) (the court may properly

7

consider documents “attached to the complaint . . . as well those attached to the motion
to dismiss, so long as they are integral to the complaint and authentic”). Indeed, “to
pursue any other tack would risk permitting ‘a plaintiff with a legally deficient claim [to]
survive a motion to dismiss simply by failing to attach a dispositive document upon
which it relied.’” Gasner, 162 F.R.D. at 282 (quoting Pension Ben. Guar. Corp. v. White
Consol. Industries, Inc., 998 F.2d 1192, 1196 (3d Cir. 1993) (holding that a court may
consider an undisputedly authentic document that a defendant attaches as an exhibit to
a motion to dismiss if the plaintiff’s claims are based on the document).
DISCUSSION
I. First Cause of Action
In the plaintiff’s first cause of action, she alleges by way of 29 U.S.C. §
1132(a)(1)(B) that US Airways unreasonably denied her health benefits under the Plan
by refusing to act as the primary payer on her medical claims. (Compl. ¶¶ 52-59, ECF
No. 1.) The Court finds that this cause of action fails to state a claim because, under the
express terms of the Plan, Medicare, and not US Airways, was the primary payer on the
plaintiff’s medical claims.
The complaint alleges that the 2011 SMM “governed” the plaintiff’s health care
coverage under the Plan. (Compl. ¶ 32, ECF No. 1.) The plaintiff quotes the “Leave of
Absence” provision under the “Coordination With Medicare for Disabled Individuals”
section for the proposition that the Plan was primary as applied to her:
Leave of Absence: If you take a leave of absence and retain coverage
under the Plan, the Plan will continue to pay primary for as long as you
retain your right to return to active employment, i.e., your employment is
not terminated by the company. If your employment is terminated by the
company, Medicare will become primary.

8

Id. Inexplicably, the plaintiff fails to reference the very next sentence of the 2011 SMM,
which, by the terms of her own pleading, is the provision that actually applied to her:
Disability: If you take a medical leave of absence, retain coverage under
the Plan, and start receiving disability benefits from the company, the Plan
will continue to pay primary for the first 6 months of your disability
coverage, i.e., while disability benefits are subject to FICA tax. After this 6
month period, Medicare will become primary for you and/or any covered
dependents.
(Ex. C, ECF No. 24-5 at 8) (emphasis added). The plaintiff alleges that she has been on
a medical leave of absence since October 2, 2001, and that she began receiving longterm disability benefits from US Airways on February 20, 2002, retroactive to the date
her medical leave of absence began. (Compl. ¶¶ 1, 18, 24, ECF No. 1.)
The Court is at a loss to understand why the plaintiff selectively excluded the
“Disability” provision from the complaint. The “Disability” provision, and not the “Leave of
Absence” provision, indisputably applies to the plaintiff’s circumstance because she was
on a medical leave of absence.1 The time frame the plaintiff alleges US Airways
improperly refused to act as the primary payer, year 2011 (see id. ¶¶ 37-41), is well
beyond six months after she began receiving long-term disability benefits, February 20,
2002 (see id. ¶ 24). As such, the express language of the 2011 SMM indicates that
Medicare was the primary payer.
If plaintiff’s medical leave of absence fell under the “Leave of Absence” provision
as the plaintiff avers, the “Disability” provision would be rendered utterly superfluous.
The Court is not permitted to read ERISA plans in such a manner. The United States
Court of Appeals for the Fourth Circuit has held:

1

The plaintiff does not contest this point in her response in opposition to the motion to dismiss.
(ECF No. 28)

9

ERISA plans, like contracts, are to be construed as a whole. Courts must
look at the ERISA plan as a whole and determine the provision’s meaning
in the context of the entire agreement. And, because contracts are
construed as a whole, courts should seek to give effect to every provision
in an ERISA plan, avoiding any interpretation that renders a particular
provision superfluous or meaningless.
Johnson v. Am. United Life Ins. Co., 716 F.3d 813, 820 (4th Cir. 2013). Put simply, it is
impossible to construe the well-pled facts in a manner that the 2011 SMM grounds a
plausible claim for relief.
The plaintiff also cites language from the 1993 SPD as supportive of her claim
that the Plan should be the primary payer. (Compl. ¶ 33, ECF No. 1). Her complaint
reads: “The January 1993 version of the Health Plan states, ‘[I]f your employer is
subject to the Medicare Secondary Payer requirements of federal law, this Plan will pay
primary.’” Id. (quoting Ex. D, ECF No. 25-1 at 122).2 Again, the plaintiff has taken
language out of context and inexplicably ignored the immediately following provision
from the 1993 SPD, which clarifies that the Plan is secondary to Medicare in her
situation. It reads: “The USAir, Inc. Health Benefit Plan pays after Medicare for . . .
[c]overed persons eligible for Medicare due to disability if . . . [t]he covered person is not
an ‘active individual’ as defined by federal law and determined by your employer.” (Ex.
D, ECF No. 25-1 at 122) (emphasis added). As with the 2011 SMM, the express
language of the 1993 SPD dictates that, even construing all of the well-pled facts and
reasonable inferences in the plaintiff’s favor, the Plan is secondary to Medicare.
In her response in opposition to the motion to dismiss, the plaintiff argues that the
phrase “active individual” in the 1993 SPD is ambiguous and that the Court should

2

As a point of clarification, the “January 1993 version of the Health Plan” that the plaintiff is
referencing is not the Plan itself, but a Summary Plan Description. The importance of this point
will be addressed more fully in the analysis below.

10

consider evidence extrinsic to the complaint in order to determine the meaning of that
language. (Pl.’s Resp. in Opp. to Mot. to Dismiss, ECF No. 28 at 4-5.) The plaintiff
asserts that “active individual” is not defined in the 1993 SPD and that there is no
indication of what federal law controls the definition. Id. at 4. If the Court were required
to consider such extrinsic evidence, it would, of course, preclude resolution of this claim
on a motion to dismiss. However, for the reasons set forth below the Court need not do
so, and the plaintiff’s arguments are unavailing.
The United States Supreme Court has held that ERISA plan summary
documents, such as the 1993 SPD, “important as they are, provide communication with
beneficiaries about the plan, but . . . do not themselves constitute the terms of the plan
for purposes of [29 U.S.C. § 1132(a)(1)(B)].” CIGNA Corp. v. Amara, 131 S. Ct. 1866,
1878 (2011) (emphasis in original). As previously stated, the Court may properly
consider documents attached to the motion to dismiss so long as they are “integral to
the complaint and authentic.” Philips v. Pitt Cnty. Mem’l Hosp., 572 F.3d 176, 180 (4th
Cir. 2009). Any ambiguity in the phrase “active individual” is rendered irrelevant once
one looks at the terms of the Plan itself, which is attached to the motion to dismiss, and
the authenticity of which is undisputed.3
3

The Court is skeptical of the plaintiff’s assertions of ambiguity in the first instance. First, in a
section entitled “Changes in Coverage for Inactive Employees” the 1993 SPD provides the
following definition: “An Employee will be considered to be an ‘Inactive Employee’ if such
Employee is on a leave of absence which takes him or her to inactive status.” (Ex. D, ECF No.
25-1 at 15.) Second, by the terms of the plaintiff’s own complaint, she has described her status
in contradistinction to that of an “active” employee of US Airways. The complaint avers that she
has been on an approved medical leave of absence from US Airways since October 2001, that
she has current employment status at US Airways, that US Airways has not terminated her
employment, and that she retains her right to return to active employment at US Airways and/or
its successor, American Airlines. (Compl. ¶¶ 18-22, ECF No. 1.) It stands to reason that an
individual cannot both retain the ability to return to active status, and be in an active status at
the same time. Third, and more importantly, the phrase “active individual” does not appear in
the Plan itself, or even the 2011 SMM on which the plaintiff predominantly relies. As such, any

11

The first relevant iteration of the Plan is the 1992 Plan, which became effective
on January 1st of that year. (Ex. B, ECF No. 24-4 at 26.) Section 4.5 clearly explains
that, except where the employee in question is still “active,” or during the first 12
consecutive months of treatment for end stage renal disease, when a participant is also
eligible for Medicare, the “Plan will pay benefits only after Medicare has paid its
benefits.” Id. at 17. Section 3.1 defines inactive status as follows: “An ‘inactive’
Employee is an Employee who is on a leave from employment with his Employer.” Id. at
12. The end result is that the plaintiff is indisputably both “inactive” and otherwise
“eligible for Medicare.” Thus, the express terms of the 1992 Plan unambiguously place
the plaintiff in a category of Plan participants for whom Medicare is the primary payer.
The 1992 Plan predates the 1993 SPD, and its terms control. See Amara, 131 S. Ct. at
1878. The 2003 Amendment to Section 4.5, effective January 1st of that year, made
only immaterial alterations and dictates the same result. (See Ex. B, ECF No. 24-4 at
51, 55.) Finally, the 2013 Plan incorporates the “Disability” provision from the 2011
SMM with only immaterial alterations. (See Ex. A, ECF No. 24-3 at 17.) Thus, the
express terms of the 2013 Plan also unambiguously instruct that Medicare becomes the
primary payer six months after an employee takes a medical leave of absence, retains
coverage under the Plan, and starts receiving disability benefits from the company. See
id.
In her response in opposition to the motion to dismiss, the plaintiff does not
contest the defendants’ assertion that her claim to benefits is governed by the
“Disability” provision from the “Coordination with Medicare” section of the Plan. (See Ex.
ambiguity in this phrase is inapposite to the resolution of the motion to dismiss because the
terms of the SPD “do not themselves constitute the terms of the plan.” Amara, 131 S. Ct. at
1878.

12

C, ECF No. 24-5 at 8 (2011 SMM); Ex. A, ECF No. 24-3 at 17 (2013 Plan).) Perhaps
seeing the writing on the wall for her first cause of action, the plaintiff converts her claim
regarding the alleged improper denial of benefits under 29 U.S.C. § 1132(a)(1)(B) to a
request for equitable relief under § 1132(a)(3).4 (Pl.’s Resp. in Opp. to Mot. to Dismiss,
ECF No. 28 at 5-7.) The plaintiff argues that even if the defendants’ interpretation of the
Plan is correct, and the Plan was not the primary payer on the claims she alleges were
improperly denied, that she is entitled to benefits pursuant to principles of waiver and
estoppel because the Plan has paid her claims as primary in the past, and she has
come to rely on the “representations by [US Airways] that they would be her primary
insurer.” Id. at 7. In support of this claim, the plaintiff relies exclusively on the United
States Supreme Court’s decision in CIGNA Corp. v. Amara, 131 S. Ct. 1866 (2011),
which she states has “implicitly overrul[ed]” Fourth Circuit case law that forecloses the
use of principles of waiver and estoppel to modify the express terms of an ERISA Plan.
(Pl.’s Resp. in Opp. to Mot. to Dismiss, ECF No. 28 at 5.) The Court disagrees.
In Amara, the United States Supreme Court expanded the equitable remedies
available to a plaintiff suing fiduciaries under 29 U.S.C. § 1132(a)(3). The ERISA plan
participants in that case filed a class action against an employer and pension plan,
claiming that the employer’s conversion of a traditional defined benefit plan to a cash
balance retirement plan provided them with less generous benefits. Amara, 131 S. Ct.
at 1870-72. The district court in Amara found that the plaintiffs’ cause of action was
authorized by § 1132(a)(1)(B), the “recovery-of-benefits-due-provision” in which the
plaintiff in the instant action grounded her allegation of improper denial of benefits. See
4

It should be noted that the plaintiff does not raise this claim as a basis for relief in her
complaint. Nevertheless, the Court will address her arguments in an abundance of caution, prior
to dismissing the first cause of action.

13

id. at 1871. Pursuant to § 1132(a)(1)(B), the district court in Amara altered the terms of
the new pension plan adopted by the defendant, CIGNA Corporation, because it found
that misrepresentations in the plan’s summary documents had caused the employees
“likely harm.” See id. The district court considered the issue of whether relief was
appropriate under § 1132(a)(3), but declined to rule on the issue in part because it had
already found that relief should be granted under § 1132(a)(1)(B). The Second Circuit
affirmed the decision, but the Supreme Court reversed, finding that although §
1132(a)(1)(B) authorized the district court to order a party to pay benefits due under a
plan, it did not authorize the court to first change the terms of the plan and then order
payment. See id. at 1876-77 (“The statutory language [of § 1132(a)(1)(B)] speaks of
‘enforc[ing]’ the ‘terms of the plan,’ not of changing them.”) The Court held that such
relief, which it characterized as “reformation of the terms of the plan” and a “remedy
[that] resembles estoppel,” was equitable in nature and thus could only be granted
pursuant to § 1132(a)(3). See id. at 1879-80. Significantly, the Court reasoned that the
reformation of the terms of the plan was appropriate “in order to remedy the false or
misleading information [the employer] provided” to its employees in summary plan
documents. See id. at 1879 (emphasis added).
Although Amara expanded the availability of equitable remedies such as
estoppel under § 1132(a)(3), it did so in the context of a suit involving material
misrepresentations in the summary plan documents and breach of trust by the plan
fiduciary. See id. 1879-80. Those issues are simply not raised in the instant case. There
is no allegation of misrepresentation or breach of a fiduciary duty. In the absence of that
context, “it is well settled in [the Fourth Circuit] that principles of waiver and estoppel

14

cannot be used to modify the express terms of an ERISA plan.” Band v. Paul Revere
Life Ins. Co., 14 F. App’x 210, 213 (4th Cir. 2001) (citing Bakery v. Confectionary Union
& Indus. Int'l Pension Fund v. Ralph's Grocery Co., 118 F.3d 1018, 1027 (4th Cir. 1997);
White v. Provident Life & Acc. Ins. Co., 114 F.3d 26, 29 (4th Cir. 1997); HealthSouth
Rehabilitation Hosp. v. American Nat. Red Cross, 101 F.3d 1005, 1010 (4th Cir. 1996);
Mullins v. Blue Cross and Blue Shield of Va., Inc., 79 F.3d 380, 381 (4th Cir. 1996);
Singer v. Black & Decker Corp., 964 F.2d 1449, 1452 (4th Cir. 1992).
In Band, a representative for an insurance company incorrectly recorded the
plaintiff’s age on the company’s application for disability insurance. Id. at 211. As a
result, the insurance company committed itself to pay 48 months of disability benefits to
the plaintiff, rather than 42 months, which was the longest period permitted by the
express terms of the plan for someone of the plaintiff’s true age. Id. When the insurance
company discovered its mistake and the plaintiff’s correct age, it refused to pay the
additional six months of benefits. The plaintiff brought suit alleging that the doctrines of
waiver and promissory estoppel prohibited the insurance company from refusing to pay
the remaining six months of benefits because the insurance company had responded by
letter to an inquiry from the plaintiff stating that the benefits would continue for the full 48
months. Id. at 212. The district court granted summary judgment for the plaintiff on the
waiver and estoppel claims, and the insurance company appealed. The Fourth Circuit
reversed, holding that the doctrines of waiver and estoppel could not supersede the
express, unambiguous language of the benefit plan. Id. at 213. “‘ERISA demands
adherence to the clear language of the employee benefit plan.’” Id. at 212 (quoting
White v. Provident Life Accident Ins. Co., 114 F.3d 26, 28 (4th Cir. 1997)). “The express

15

terms of the Plan must be followed.” Id. (citing HealthSouth Rehabilitation Hosp., 101
F.3d at 1009-10 (4th Cir. 1996)).
The holding in Amara does not disturb these core principles, and the Court
declines to read Amara as broadly as the plaintiff encourages. The plaintiff’s reading of
Amara purports to convey a broad new power to reform ERISA plans upon the lower
courts. Were such a reading adopted, Amara would permit carte blanche challenges to
every denial of ERISA plan benefits under § 1132(a)(3), the express, unambiguous
language of the plan notwithstanding. Again, the Court will not read Amara in a manner
that eviscerates a huge swath of federal common law surrounding ERISA. On the
contrary, Amara and Band can be read consistently as two sides of the same coin –
Amara permits equitable relief where a plaintiff cannot recover under § 1132(a)(1)(B),
but has otherwise been wronged by an ERISA plan; Band preserves the integrity of the
express terms of ERISA plans where no other such wrong exists. See also, Amara, 563
U.S. at 1881 (“To be sure, just as a court of equity would not surcharge a trustee for a
nonexistent harm, a fiduciary can be surcharged under [§ 1132(a)(3)] only upon a
showing of actual harm . . . .” (internal citation omitted)).
The plaintiff’s waiver and estoppel arguments seek to capitalize on the fact that
the Plan errantly paid the plaintiff’s medical claims for some time as though the Plan,
not Medicare, were the primary payer. As the Court has set forth above, the Plan did so
in contravention of its own express terms, to its own financial detriment, but to the
plaintiff’s benefit. How or why the Plan administrator mistakenly permitted the Plan to
continue to pay as primary is of no import to the resolution of the motion to dismiss, and
is outside the Court’s purview at this stage of the litigation. It is enough to simply note,

16

that the change from primary to secondary payer on the part of the Plan was a change
from

non-compliance

to

compliance

with

its

own

terms,

and

involved

no

misrepresentation on the part of the Plan or US Airways. Put simply, the plaintiff has not
made a plausible showing that she was harmed in any way by the Plan mistakenly
acting as primary payer.
The Rule 12(b)(6) standard requires the Court to accept all well-pled allegations
in the plaintiff’s complaint as true and draw all reasonable factual inferences therefrom
in favor of the plaintiff. See, e.g., Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th
Cir. 1999). But the standard certainly does not counsel turning a blind eye to the
express language of the Plan or engaging in a selective reading of the applicable text.
Having construed all relevant facts and all reasonable inferences in the plaintiff’s favor,
the Court still finds that the plaintiff has not set forth sufficient factual matter regarding
US Airways’ refusal to act as primary payer to state a claim to relief that is plausible on
its face. See Iqbal, 556 U.S. at 678. As such, the Court grants the defendants’ motion to
dismiss the first cause of action with prejudice.
II. Second Cause of Action
In the plaintiff’s second cause of action, she alleges by way of 29 U.S.C. § 1133
that US Airways violated ERISA’s procedural requirements by failing to provide her with
a full and fair review of the specific reasons why her claims were denied, written in a
manner calculated for her understanding. (Compl. ¶¶ 61-64, ECF No. 1.) The plaintiff
further claims that US Airways failed to afford her a reasonable opportunity for a full and
fair review of the decision denying the claims as required by ERISA. (Id. ¶ 62.) Finally,
she alleges she “has had to expend a substantial amount of time and resources to

17

secure her rightful benefits” because of US Airways “improper claims procedure.” (Id. ¶
63.) By way of relief, the plaintiff requests that the Court “redress the ERISA violations
outlined herein above, [] enforce the provisions of ERISA and the terms of the Plan, and
[provide] such other and further appropriate equitable relief as this Court deems just and
proper.” (Id. ¶ 64). The Court finds that this cause of action fails to state a claim
because the plaintiff has failed to set forth sufficient facts to substantiate a plausible
claim for relief.
The Court must note at the very outset, that the plaintiff’s complaint is woefully
deficient in explaining, with any level of specificity, how US Airways allegedly violated
the procedural requirements of 29 U.S.C. § 1133. In this regard, the Court believes that
the second cause of action amounts to little more than “an unadorned, the-defendantunlawfully-harmed-me accusation” which falls short of the pleading standard in
Fed.R.Civ.P. 8(a)(2). See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In light of this
deficiency, the Court could simply dismiss the second cause of action without any
further analysis. Nevertheless, in an abundance of caution, the Court will consider the
applicable law and relevant, undisputed facts, which it is forced to glean from the motion
to dismiss.
ERISA directs that “every employee benefit plan shall”:
(1) provide adequate notice in writing to any participant or beneficiary
whose claim for benefits under the plan has been denied, setting forth the
specific reasons for such denial, written in a manner calculated to be
understood by the participant, and (2) afford a reasonable opportunity to
any participant whose claim for benefits has been denied for a full and fair
review by the appropriate named fiduciary of the decision denying the
claim.

18

29 U.S.C. § 1133. “ERISA empowers the Secretary of Labor to ‘prescribe such
regulations as he finds necessary or appropriate to carry out’ the statutory provisions
securing employee benefit rights.” Black & Decker Disability Plan v. Nord, 538 U.S. 822,
831 (2003) (quoting 29 U.S.C. § 1135); see 29 U.S.C. § 1133 (plans shall process
claims “[i]n accordance with regulations of the Secretary”). The Secretary of Labor’s
regulations specify that the written notice required by 29 U.S.C. § 1133(1) must set
forth, “in a manner calculated to be understood by the claimant”:
(i) The specific reason or reasons for the adverse determination;
(ii) Reference to the specific plan provisions on which the determination is
based;
(iii) A description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such material
or information is necessary;
(iv) A description of the plan’s review procedures and the time limits
applicable to such procedures, including a statement of the claimant’s
right to bring a civil action under section 502(a) of the Act following an
adverse benefit determination on review . . . .
29 C.F.R. § 2560.503-1(g)(1). The regulations also direct that a “‘full and fair review’
includes the opportunity for the claimant to appeal the adverse benefits determination
and to submit written comments or records.” Gagliano v. Reliance Standard Life Ins.
Co., 547 F.3d 230, 235 (4th Cir. 2008); see 29 C.F.R. § 2560.503-1(h)(2). “These
requirements are designed both to allow the claimant to address the determinative
issues on appeal and to ensure meaningful review of the denial.” Love v. Nat’l City
Corp. Welfare Benefits Plan, 574 F.3d 392, 396 (7th Cir. 2009) (citing Halpin v. W.W.
Grainger, Inc., 962 F.2d 685, 689 (7th Cir. 1992)).
The plaintiff states the following facts in her complaint: (a) the defendants
“unilaterally ceased paying as the primary provider” in 2011 (Compl. ¶ 37, ECF No. 1),
(b) neither the defendants nor Medicare have paid her 2011 health care claims (Id. ¶
19

40), (c) she timely appealed the defendants’ denial of her 2011 health benefits on July
26, 2011 and December 15, 2011 (Id. ¶ 42), (d) the defendants denied her 2011 health
care claims on August 23, 2012 via a “Notice of Final Internal Adverse Benefit
Determination” (Id. ¶ 43), and (e) by letter dated February 11, 2011, US Airways
provided some but not all of the documents she requested related to the Plan (Id. ¶ 69).
The complaint was utterly non-specific regarding any putative deficiencies in the
notification and review process regarding US Airways’ refusal to act as primary payer on
the plaintiff’s 2011 medical claims. As such, the Court has attempted to cobble together
all facts from the complaint that even peripherally referenced matters related to these
procedures. Even after doing so, it is entirely unclear to the Court what deficiencies the
plaintiff is alleging.
The Court will first dispose of those portions of the plaintiff’s second claim that
are most lacking in substance. The plaintiff claims that US Airways failed to afford her a
reasonable opportunity for a full and fair review of the decision denying her 2011
claims—but this assertion is flatly refuted by the terms of her own pleading, which states
that she timely appealed the denial of benefits twice before receiving a final adverse
benefits determination. See Gagliano, 547 F.3d at 235. Plaintiff does not explain how
she was denied a full and fair review, and she fails to state a claim in this regard.
Additionally, the plaintiff points to the fact that she has had to expend her own time and
resources in pursuit of her benefits because of US Airways’ “improper claims
procedure.” Even applying the most generous interpretive principles, the Court cannot
discern any actionable injury alleged by the plaintiff and concludes that the plaintiff has
failed to state a claim.

20

The plaintiff further claims that she was not provided a full and fair review of the
specific reasons why her claims were denied. She incidentally references a letter from
US Airways dated February 11, 2011, but only to note that not all of the documents she
requested from the Plan were provided. She did not attach the February 11, 2011 letter
to her complaint. Upon review of the February 11, 2011 letter, the Court finds that the
Vice President of Human Resources at US Airways explained exactly why the plaintiff’s
claims were denied in painstaking detail over the course of five pages.5 (See Mot. to
Dismiss, Ex. E, ECF No. 25-2). The plaintiff also references a “Notice of Final Internal
Adverse Benefit Determination” sent to her on August 23, 2012 after she timely
appealed the denial of her 2011 health benefits twice. She did not attach the August 23,
2012 notice to the complaint. Upon review of the August 23, 2012 notice, the Court finds
that a Clinical Appeals Analyst at US Airways again explained in specific terms why the
plaintiff’s claims were being denied. (See Mot. to Dismiss, Ex. F, ECF No. 25-3 at 19).
In her response in opposition to the motion to dismiss, the plaintiff does not describe
any deficiencies in these notices or procedures, rather she vacuously states that she
has “presented questions of disputed facts” pertaining to her second cause of action
and that the Court “must accept said allegations as true.” (Pl.’s Resp. in Opp. to Mot. to
Dismiss, ECF No. 28 at 7.) The Court is not convinced. The plaintiff simply has not set
forth sufficient facts to state a plausible claim to relief on the grounds that US Airways’
notifications and procedures denying her 2011 health benefits claims were deficient
under 29 U.S.C. § 1133 or the applicable regulations. As such, the Court grants the
defendants’ motion to dismiss the second cause of action.
5

As set forth above, the Court will consider documents attached to the motion to dismiss that
are integral to the plaintiff’s complaint and the authenticity of which is undisputed. These
prerequisites are satisfied for Exhibits E and F to the motion (ECF Nos. 25-2, 25-3).

21

III. Third Cause of Action
In the plaintiff’s third cause of action, she alleges that as the Plan administrator,
US Airways violated ERISA, 29 U.S.C. § 1132(c), by failing to provide her with the Plan
documents she requested in a time period that complied with the statute. (Compl. ¶¶ 6673, ECF No. 1.) Therefore, she asserts, she is entitled to money damages for every day
of non-compliance. (Id. ¶ 72.)
ERISA provides:
Any administrator . . . who fails or refuses to comply with a request for any
information which such administrator is required by this subchapter to
furnish to a participant or beneficiary (unless such failure or refusal results
from matters reasonably beyond the control of the administrator) by
mailing the material requested to the last known address of the requesting
participant or beneficiary within 30 days after such request may in the
court’s discretion be personally liable to such participant or beneficiary in
the amount of up to $100 a day from the date of such failure or refusal,
and the court may in its discretion order such other relief as it deems
proper.
29 U.S.C. § 1132(c)(1)(B). The complaint alleges that the plaintiff requested documents
related to the Plan on September 30, 2011 by way of a letter to US Airways. (Compl. ¶
66, ECF No. 1). The plaintiff attached this letter to the complaint as exhibit 1. (Id.) She
further avers that US Airways acknowledged her request by way of a responsive letter
dated December 2, 2011, but did not provide the requested plan documents. (Id. ¶ 67).
She attached US Airways’ December 2, 2011 to the complaint as exhibit 2. (Id.) It reads
in relevant part:
With respect to your document request, we have already provided all
relevant plan documents, summary plan descriptions and collective
bargaining agreements that govern the terms of your medical coverage
(please see our discussion of this topic in the last section of our February
11, 2011 letter). The only outstanding item appears to be your request for
the “administrative record” and claims procedures. To the extent that such

22

information exists, BCBSNC, the Claims Administrator, can provide that
information to you directly if you contact them at the following address. . . .
(Compl., Ex. 2, ECF No. 1-2 at 2.)
The plaintiff next alleges that she submitted another letter on December 13,
2011, requesting the plan documents again. (Compl. ¶ 68, ECF No. 1.) She attached
this second request letter to the complaint as exhibit 3. (Id.) In the December 13, 2011
request, the plaintiff indicates specific documents and portions of documents that she
believes she has not been provided; she also indicates that the relevant plan
documents provided by US Airways on February 11, 2011 to her attorney, were
incomplete, and that pursuant to ERISA she believes she has a right to be provided with
her own copy. (Compl., Ex. 3, ECF No. 1-3 at 2-3.) The plaintiff further alleges that she,
through new counsel, requested the plan documents a third time by way of a letter
dated January 25, 2012. (Compl. ¶ 70, ECF No. 1.) She attached this third request letter
to the complaint as exhibit 4. (Id.) In the January 25, 2012 request, the plaintiff’s new
counsel explains that the portion of the plan documents she and her client believe to
have been missing when they were provided to the previous attorney includes the
pages that address the Plan’s coordination with Medicare on the primary and secondary
payer issue. (Compl., Ex. 4, ECF No. 1-4 at 2.)
The plaintiff states that she ultimately received the missing portion of the plan
documents on February 14, 2012, but only after much delay. (Compl. ¶ 71, ECF No. 1.)
She attaches a US Airways letter dated January 31, 2012, which purports to deliver the
requested plan documents, as exhibit 5. (Id.) The Court finds that the plaintiff has set
forth sufficient factual matter, when accepted as true, to state a claim to relief that is
plausible on its face. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The well-pled
23

facts allow the Court to draw the reasonable inference that the defendants are liable for
the misconduct alleged. See id.
In the motion to dismiss, the defendants argue that US Airways complied with the
plaintiff’s request for plan documents in a timely fashion. (Mot. to Dismiss, ECF No. 24-1
at 25.) They assert that their delivery of documents to the plaintiff’s previous counsel,
referenced in the February 11, 2011 letter attached to their motion, was satisfactory and
that there was no violation of 29 U.S.C. § 1132(c). (See id. at 25-27.) The Court finds
that the defendants’ arguments on this issue address the merits of the plaintiff’s claim,
not any supposed deficiency in her pleading. Fed.R.Civ.P. 12(b)(6) does not permit the
Court to resolve factual disputes by way of a motion to dismiss. “A plausible but
inconclusive inference from pleaded facts will survive a motion to dismiss . . . .”
Sepulveda-Villarini v. Dep’t of Educ. of Puerto Rico, 628 F.3d 25, 30 (1st Cir. 2010).
Because there are outstanding questions of disputed fact, and the Court must accept
the plaintiff’s well-pled facts as true, the defendants’ motion to dismiss the third cause of
action is denied.
IV. Fourth Cause of Action
The plaintiff’s fourth cause of action rehashes her allegation that US Airways
broke the law, this time the Medicare Secondary Payer Act (“MSPA”), 42 U.S.C. §
1395y, by failing to provide primary payment for the plaintiff’s 2011 medical claims.
(Compl. ¶¶ 75-79, ECF No. 1.) Because, the plaintiff argues, US Airways had the
responsibility to pay for her medical claims in 2011 as primary, and failed to do so, she
is entitled to double damages under 42 U.S.C. § 1395y(b)(3)(A). (Id.) This cause of

24

action fails to state a claim for the same reasons already explained with respect to the
first cause of action—the Plan was not the primary payer for the plaintiff’s claims.
With respect to disabled individuals in large group health plans, the MSPA states,
“In general [a] large group health plan. . . may not take into account that an individual. . .
who is covered under the plan by virtue of the individual’s current employment status
with an employer is entitled to benefits under [the Medicare program].” 42 U.S.C. §
1395y(b)(1)(B)(i) (emphasis added). In other words, a plan must pay primary for any
covered individual with “current employment status.” See 42 C.F.R. § 411.102(c). The
regulations promulgated to implement the MSPA explain that “[a]n individual has current
employment status if . . . [t]he individual is actively working as an employee . . . or . . .
[t]he individual is not actively working and . . . [i]s receiving disability benefits from an
employer for up to 6 months . . . .” 42 C.F.R. § 411.104 (emphasis added). The obvious
inference is that an individual’s “current employment status” for purposes of the MSPA
does not extend beyond six months of receiving disability benefits from her employer
while she is not actively working. See id. After that six month period, the general
prohibition on a plan taking into account that the individual is entitled to Medicare
benefits no longer applies. See 42 U.S.C. § 1395y(b)(1)(B)(i). The United States Court
of Appeals for the Eleventh Circuit has explained it this way:
[T]he [MSPA] statute prohibits private insurers providing coverage as a
result of an individual’s current employment status from making Medicare
primary to its coverage for that individual or that individual’s spouse . . . .
The MSP statute contains no similar provision with respect to private
insurance plans covering such individuals for reasons other than current
employment status. Thus, private plans covering such individuals for
reasons other than current employment status of that individual . . . may
make their coverage secondary to Medicare when those individuals are
simultaneously eligible for Medicare.

25

Harris Corp. v. Humana Health Ins. Co. of Fla., Inc., 253 F.3d 598, 601 (11th Cir. 2001)
(emphasis in original). As set forth extensively above, this transfer of primary payer
responsibility from US Airways to Medicare is exactly what the express terms of the
Plan provide now and historically have provided. As such, the plaintiff’s fourth cause of
action fails to state a claim and is hereby dismissed.6
CONCLUSION
For the reasons set forth above, defendants’ motion to dismiss is GRANTED in
part and DENIED in part. For those portions of the complaint for which dismissal is
GRANTED, such dismissal is with respect to all defendants and is with prejudice.
IT IS SO ORDERED.
/s/ Bruce Howe Hendricks
United States District Judge
September 30, 2015
Greenville, South Carolina

6

In her response in opposition to the motion to dismiss, the plaintiff makes cursory arguments
for why, in her view, the MSPA still requires the Plan to pay as primary. As with her ERISA
claim, she invokes alleged ambiguity in the language of the Plan and equitable principles to
support the notion that US Airways was the primary insurer. For the reasons explained in the
analysis of the first cause of action, the Court finds these arguments unpersuasive. The plaintiff
also makes brief policy arguments for why the Court should find that her complaint states a
claim under the MSPA: “The purposes [sic] [MSPA] include protecting the Federal Government
from cost shifting tactics by private businesses. In this instance, [US Airways] is responsible for
[the plaintiff’s] care, but instead wishes to put the burden of an employee’s healthcare costs on
United States citizens instead. It is just this sort of abuse that the [MSPA] was enacted to
discourage.” (Pl.’s Resp. in Opp. to Mot. to Dismiss, ECF No. 28 at 8.) The Court finds these
arguments similarly inapposite and unavailing.

26