Bradshaw v. Principal Financial Group d/b/a Principal Life Insurance Company
Filing
28
ORDER granting 10 Motion to Dismiss for Failure to State a Claim; denying 15 Motion to Amend/Correct; denying as moot 24 Motion to Dismiss for Failure to State a Claim; denying as moot 27 Motion to Stay. Signed by Judge Samuel H. Mays, Jr on 12-20-2017. (Mays, Samuel)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DIVISION
PATRICIA BRADSHAW,
)
)
Plaintiff,
)
)
v.
)
)
PRINCIPAL FINANCIAL GROUP d/b/a )
PRINCIPAL LIFE INSURANCE
)
COMPANY,
)
)
Defendant.
)
No. 2:17-CV-02174-SHM
ORDER
Before the Court are four motions: (1) Defendant Principal
Financial
Group’s
Partial
Motion
to
Dismiss
Plaintiff’s
Com-
plaint and to Strike Plaintiff’s Jury Demand (“Motion to Dismiss
I”), filed on May 15, 2017 (ECF No. 10; see also ECF No. 11);
(2)
Plaintiff
Patricia
Bradshaw’s
Motion
to
Amend
Complaint
(“Motion to Amend”), filed on June 12, 2017 (ECF No. 15); (3)
Defendant’s Partial Motion to Dismiss Plaintiff’s Amended Complaint and to Strike Plaintiff’s Jury Demand (“Motion to Dismiss
II”), filed on November 10, 2017 (ECF No. 24; see also ECF No.
25); and (4) Joint Motion to Stay Related to ECF Nos. 24, 25,
and 26 (“Joint Motion to Stay”), filed on December 4, 2017 (ECF
No. 27).
For the reasons discussed below, Defendant’s Motion to Dismiss I is GRANTED, Plaintiff’s Motion to Amend is DENIED, and
Defendant’s Motion to Dismiss II and the Joint Motion to Stay
are DENIED AS MOOT.
I.
Background
Defendant
issued
long-term
disability
insurance
(the “Plan”) to Plaintiff through her employer.
2.)1
coverage
(ECF No. 1 at
On or about June 3, 2005, Plaintiff was diagnosed with ma-
lignant, metastatic melanoma.
(Id.)
Because of her illness,
Plaintiff stopped working on August 8, 2005.
Plaintiff
began
receiving
long-term
(Id.)
disability
benefits
from Defendant under the Plan on or around November 9, 2005.
(Id.)
Defendant also helped Plaintiff receive Social Security
Disability Income (“SSDI benefits”), hiring a lawyer and helping
Plaintiff obtain records.
(Id. at 3; ECF No. 15 at 119.)
De-
fendant informed Plaintiff that, if Plaintiff received SSDI benefits, the amount she received from Defendant under the Plan
would be reduced.
(ECF No. 1 at 3.)
Plaintiff began receiving
SSDI benefits before October 20, 2006.2
On October 20, 2006,
Plaintiff mailed Defendant a check for $11,439.76 to compensate
1
Unless otherwise noted, all pin cites for record citations are
to the “PageID” page number.
2
The record does not show the date Plaintiff began receiving
SSDI benefits. Plaintiff represents, and Defendant does not
dispute, that Plaintiff mailed Defendant a check for overpayment
of long-term disability benefits “[a]fter Plaintiff was approved
for SSDI benefits.” (ECF No. 1 at 3.) Plaintiff mailed the
check on October 20, 2006. (ECF No. 1-3 at 63.)
2
Defendant for the overpayment of long-term disability benefits.
(See ECF No. 1 at 3; ECF No. 1-3 at 63.)
Plaintiff’s SSDI benefits were terminated on May 2, 2013.
(ECF No. 1 at 3).
Defendant paid Plaintiff’s attorney to appeal
the termination of Plaintiff’s SSDI benefits.
(Id.)
Defend-
ant’s representatives told Plaintiff that, if she did not begin
receiving SSDI benefits again, her long-term disability benefits
would be increased to the amount Plaintiff had received before
receiving SSDI benefits.
(Id.)
Plaintiff began receiving SSDI
benefits again on or about September 26, 2014.
(Id.)
On October 20, 2014, Defendant sent Plaintiff a letter informing her that her long-term disability benefits were being
terminated.
(Id.; ECF No. 1-4 at 64.)
Defendant’s letter said
that Plaintiff “no longer [met] the definition of Disability beyond 10/9/2014.”
(ECF No. 1-4 at 64.)
On March 14, 2017, Plaintiff filed her Complaint.
1.)
The
Complaint
alleges
that
Defendant’s
(ECF No.
termination
of
Plaintiff’s long-term disability benefits violated the Employee
Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001, et
seq. (“ERISA”) and breached a contract between Plaintiff and Defendant.
(Id. at 5-6.)
to Dismiss I.
On May 15, 2017, Defendant filed Motion
(ECF No. 10; see also ECF No. 11.)
2017, Plaintiff filed the Motion to Amend.
3
On June 12,
(ECF No. 15.)
De-
fendant responded to Plaintiff’s Motion to Amend on June 26,
2017.
(ECF No. 16.)
On October 18, 2017, the Court entered an Order Reserving
Defendant’s Motion to Dismiss I and Plaintiff’s Motion to Amend
pending filing of Plaintiff’s proposed amendment.
(ECF No. 22.)
The Court ordered Plaintiff to file her proposed amendment by
October 30, 2017.
(Id. at 152.)
On October 27, 2017, Plaintiff filed her First Amended Complaint.
(ECF No. 23.)
Although styled an amended complaint,
the document is a proposed amended complaint.
On November 10,
2017, Defendant filed its Motion to Dismiss II.
(ECF No. 24;
see also ECF No. 25.)
On December 4, 2017, the parties filed the Joint Motion to
Stay.
(ECF No. 27.)
The Joint Motion to Stay asks the Court
“to stay any response due from Plaintiff to the motion filed by
the Defendant . . . until such time as the Court rules [on
Plaintiff’s Motion to Amend].”
II.
(Id. at 313-14.)
Standard of Review
A. Rule 12(b)(6)
In addressing a motion to dismiss for failure to state a
claim under Federal Rule of Civil Procedure 12(b)(6), the Court
must construe the complaint in the light most favorable to the
plaintiff and accept all well-pled factual allegations as true.
League of United Latin Am. Citizens v. Bredesen, 500 F.3d 523,
4
527 (6th Cir. 2007).
A plaintiff can support a claim “by show-
ing any set of facts consistent with the allegations in the complaint.”
(2007).
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 563
This standard requires more than bare assertions of le-
gal conclusions.
Bovee v. Coopers & Lybrand C.P.A., 272 F.3d
356, 361 (6th Cir. 2001).
Any claim for relief must contain “a
short and plain statement of the claim showing that the pleader
is entitled to relief.”
(2007) (per curiam).
Erickson v. Pardus, 551 U.S. 89, 93
“Specific facts are not necessary; the
statement need only ‘give the defendant fair notice of what the
. . . claim is and the grounds upon which it rests.’”
ing Twombly, 550 U.S. at 555.)
Id. (cit-
Nonetheless, a complaint must
contain sufficient facts “to ‘state a claim to relief that is
plausible on its face’” to survive a motion to dismiss.
Ash-
croft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550
U.S. at 570).
B. Rule 15(a)
Federal Rule of Civil Procedure 15(a)(2) provides that a
Court should give leave to amend a pleading freely “when justice
so requires.”
In the absence of . . . undue delay, bad faith or dilatory motive on the part of the movant, repeated
failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. -- the leave sought should . . . be “freely
given.”
5
Foman v. Davis, 371 U.S. 178, 182 (1962); see also Head v. Jellico Hous. Auth., 870 F.2d 1117, 1123 (6th Cir. 1989).
III. Analysis
A. Motion to Amend
Plaintiff’s proposed amended complaint asserts a claim under ERISA.
(ECF No. 23 at 169.)
Plaintiff’s proposed amended
complaint also brings a state law claim for breach of contract.
(Id. at 169-70.)
Defendant contends that Plaintiff’s motion to
amend her complaint must be denied as futile because Plaintiff’s
breach of contract claim is preempted by ERISA.
(ECF No. 11 at
88-89.)
ERISA provides a uniform regulatory regime governing employee benefit plans and includes expansive preemption provisions intended to ensure that employee benefit plan regulation
is
“exclusively
a
federal
concern.”
Alessi
Manhattan, Inc., 451 U.S. 504, 523 (1981).
v.
Raybestos-
The express preemp-
tion clause provides that ERISA “supersede[s] any and all State
laws insofar as they may now or hereafter relate to any employee
benefit plan.”
29 U.S.C. § 1144(a).
“A law relates to an em-
ployee benefit plan ‘if it has a connection with or reference to
such a plan.’”
Crabbs v. Copperweld Tubing Products Co., 114
F.3d 85, 90 (6th Cir. 1997) (quoting Shaw v. Delta Air Lines,
Inc., 463 U.S. 85, 87 (1983)).
A law has a connection with an
6
employee plan under ERISA “‘even if the law is not specifically
designed to affect such plans, or the effect is only indirect,
and even if the law is consistent with ERISA's substantive requirements.’”
Thiokol Corp. v. Roberts, 76 F.3d 751, 754 (6th
Cir. 1996) (quoting District of Columbia v. Greater Wash. Bd. of
Trade, 506 U.S. 125, 130 (1992)).
Plaintiff’s breach of contract claim has a connection with
or reference to the Plan.
Plaintiff’s proposed amended com-
plaint alleges “that the long-term benefit policy purchased by
Plaintiff’s employer, on her behalf, from Defendant, along with
the oral assurances and promises of the Defendant and/or its employees, agents, and/or representatives, constitutes a contract
which the Defendant has breached.”
claim
is
“at
the
very
heart
of
(ECF No. 23 at 170.)
issues
within
the
That
scope
of
ERISA’s exclusive regulation and, if allowed, would affect the
relationship between plan principals by extending coverage beyond the terms of the plan.”
Cromwell v. Equicor-Equitable HCA
Corp.,
(6th
944
F.2d
1272,
1276
Cir.
1991)
(dismissing
as
preempted by ERISA a breach of contract claim based on alleged
oral assurances of coverage); see Huisjack v. Medco Health Solutions,
Inc.,
492
F.
Supp.
2d
839,
849
(S.D.
Ohio
2007)
(“[C]ourts have repeatedly held that a breach of contract claim
against an insurer arising out of a denial for benefits is essentially a claim for benefits under ERISA and should be charac-
7
terized as such.”); Johnson v. Decor Fabrics, Inc., 250 F.R.D.
323, 329–30 (M.D. Tenn. 2008) (“On numerous occasions, the Sixth
Circuit has found breach of contract claims to be preempted by
ERISA.”); Ackerman v. Fortis Benefits Ins. Co., 254 F. Supp. 2d
792, 818 (S.D. Ohio 2003) (finding that a “claim for breach of
contract,
in
which
[plaintiff]
alleges
that
[defendant]
‘breached its obligations to [plaintiff] under the terms of the
policy, without any justifiable reason for such breach’” was
preempted by ERISA).
Plaintiff’s
proposed
amended
claim for breach of contract.
would be futile.
complaint
fails
to
state
a
The proposed amended complaint
See Riverview Health Inst., LLC v. Medical
Mut. Of Ohio, 601 F.3d 505, 512 (6th Cir. 2010) (holding that an
amendment is futile if it cannot withstand a motion to dismiss
under Rule 12(b)(6)).
Plaintiff’s Motion to Amend is DENIED.
Defendant’s Motion to Dismiss I is GRANTED insofar as it seeks
to dismiss Plaintiff’s claim for breach of contract.
Defend-
ant’s Motion to Dismiss II and the Joint Motion for Stay are
DENIED AS MOOT.
B. Motion To Strike Plaintiff’s Jury Demand
Plaintiff requests a jury trial.
(ECF No. 1 at 6.)
De-
fendant contends that “[t]he Sixth Circuit . . . has routinely
held that plaintiffs are not entitled to a jury trial pursuant
to the provisions of ERISA.”
(ECF No. 11 at 89.)
8
“Accordingly,
Plaintiff has no right to a jury trial in the present case.”
(Id.)
ERISA does not address the right to a jury trial.
The
Sixth Circuit has held that ERISA claims are equitable and thus
not
eligible
for
a
jury
trial.
See
Wilkins
v.
Baptist
Healthcare Sys., 150 F.3d 609, 616 (6th Cir. 1998); Bair v. General Motors Corp., 895 F.2d 1094, 1096 (6th Cir. 1990).
Plain-
tiff is not entitled to a jury trial under ERISA.
The
Seventh
Amendment
right to a jury trial.
does
not
guarantee
Plaintiff
the
It provides: “In suits at common law,
where the value in controversy shall exceed twenty dollars, the
right of trial by jury shall be preserved.”
The Seventh Amend-
ment right to a jury trial applies only when the relief sought
is
legal
rather
than
equitable.
Chauffeurs,
Teamsters,
Helpers, Local 391 v. Terry, 494 U.S. 558, 565 (1990).
and
The
Sixth Circuit has decided that “the Seventh Amendment does not
guarantee a jury trial in ERISA . . . cases.”
Reese v. CNH Am.
LLC, 574 F.3d 315, 327 (6th Cir. 2009).
Plaintiff is not entitled to a jury trial on her ERISA
claim.
Defendant’s Motion to Dismiss I is GRANTED insofar as it
seeks to strike Plaintiff’s jury demand.
IV.
Conclusion
For the foregoing reasons, Defendant’s Motion to Dismiss I
is GRANTED, Plaintiff’s Motion to Amend is DENIED, and Defend-
9
ant’s Motion to Dismiss II and the Joint Motion to Stay are
DENIED AS MOOT.
So ordered this 20th day of December, 2017.
/s/ Samuel H. Mays, Jr. ___
SAMUEL H. MAYS, JR.
UNITED STATES DISTRICT JUDGE
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