LeGras v. AETNA Life Ins. Co.

• Citation: 786 F.3d 1233
• Decision Date: 28 May 2015
• Docket Number: No. 12–56541.,12–56541.
• Parties: Andre LeGRAS, Plaintiff–Appellant, v. AETNA LIFE INSURANCE COMPANY; Federal Express Corporation Long Term Disability Plan, Defendants–Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

786 F.3d 1233

Andre LeGRAS, Plaintiff–Appellant

v.AETNA LIFE INSURANCE COMPANY; Federal Express Corporation Long Term Disability Plan, Defendants–Appellees.

No. 12–56541.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 7, 2014.

Filed May 28, 2015.

Peter S. Sessions (argued) and Glenn R. Kantor, Kantor & Kantor LLP, Northridge, CA, for Plaintiff–Appellant.

David P. Knox (argued), Federal Express Corporation, Memphis, TN, for Defendants–Appellees.

Before: HARRY PREGERSON, RICHARD A. PAEZ, and N. RANDY SMITH, Circuit Judges.

Opinion by Judge PAEZ

; Dissent by Judge N.R. SMITH.

OPINION

PAEZ, Circuit Judge:

Andre LeGras appeals the district court's judgment in favor of Defendants Federal Express Corporation Long Term Disability Plan and AETNA Life Insurance Company (collectively, “AETNA”). In a letter denying LeGras's application for continued long-term disability benefits, AETNA informed LeGras that he could file an internal appeal of the decision within 180 days. The 180–day period ended on a Saturday. Although LeGras mailed his appeal the following Monday, AETNA denied it as untimely. The district court dismissed LeGras's action for failure to exhaust administrative remedies. We reverse. We hold that because the last day of the appeal period fell on a Saturday, neither that day nor Sunday count in the computation of the 180 days. As LeGras mailed his notice of appeal on Monday, it was timely. This method of counting time is widely recognized and furthers the goals and purposes of the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq. We therefore adopt it as part of ERISA's federal common law.

I.

In October 2008, LeGras seriously injured himself while working as a ramp transport driver for Federal Express Corporation (“FedEx”), a job he had held for twenty-three years. LeGras suffered a serious back injury that caused severe and sustained pain. Subsequent surgeries did not correct the problem. As an employee of FedEx, LeGras was a participant and beneficiary of FedEx's Long Term Disability Plan (“LTD Plan” or “Plan”). In May 2009, he began receiving disability benefits under the Plan. Subsequently, AETNA, the Plan's Claims Paying Administrator, informed LeGras that his benefits would terminate on May 24, 2011, unless he could establish that his disability qualified as a “total disability” under the LTD Plan.

After LeGras attempted to make the required showing, AETNA sent LeGras a letter explaining that the evidence he submitted did not establish that he suffered from a total disability. Of concern to AETNA was LeGras's alleged failure to prove that he could not “sit or use [his] upper extremities for sedentary work.” LeGras received the letter at 1:23 p.m. on April 18, 2011. The letter stated, “[i]f you disagree with the above determination, in whole or in part, you may file a request to appeal this decision within 180 days of receipt of this notice.”

The parties agree that the 180–day appeal period expired on October 15, 2011, a Saturday. LeGras mailed his appeal the following Monday. On January 17, 2012, AETNA denied LeGras's appeal as untimely. LeGras filed an action in the district court pursuant to 29 U.S.C. § 1132, the civil enforcement provision of ERISA. After answering the complaint, AETNA filed a motion for judgment on the pleadings under Federal Rule of Civil Procedure 12(c). AETNA argued that LeGras failed to exhaust his administrative remedies because he mailed his appeal after the 180–day period specified in the April 18, 2011 denial letter lapsed. The district court granted the motion and entered judgment in favor of AETNA.¹

LeGras timely appealed.²

II.

We review de novo an order granting a motion for judgment on the pleadings under Rule 12(c). Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir.2009). We accept the factual allegations in the complaint as true, and view them in a light most favorable to the plaintiff. Hoeft v. Tucson Unified Sch. Dist., 967 F.2d 1298, 1301 & n. 2 (9th Cir.1992).

The federal statute governing claims procedures under ERISA requires that “in accordance with regulations of the Secretary [of Labor], every employee benefit plan shall ... 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.” 29 U.S.C. § 1133(2). The regulation implementing 29 U.S.C. § 1133 states that a “reasonable opportunity for a full and fair review” is “at least 180 days following receipt of a notification of an adverse benefit determination within which to appeal....” 29 C.F.R. § 2560.503–1(h)(3), (h)(3)(i), (h)(4). Neither the governing statute, nor the implementing regulation, “specify a method of computing time.”³ Cf. Fed.R.Civ.P. 6(a). This leaves a number of unresolved ambiguities. For instance, did the 180 days begin on April 18, 2011, the day LeGras received the notice, or on the following day? Does the final day end at 1:23 p.m., 5:00 p.m., or midnight? And, as is relevant here, if the final day lands on a weekend or holiday, is the participant permitted to file his appeal on the next business day? The widespread understanding that a deadline falling on a Saturday, Sunday, or holiday extends to the next business day answers this question.

Congress, in enacting ERISA, has “empowered the courts to develop, in light of reason and experience, a body of federal common law governing employee benefit plans.” Menhorn v. Firestone Tire & Rubber Co., 738 F.2d 1496, 1499 (9th Cir.1984). This federal common law “supplement[s] the explicit provisions and general policies set out in ERISA ... governed by the federal policies at issue.” Id. at 1500. One of ERISA's declared policies is to “protect the interest of [plan] participants” and to provide “adequate safeguards ... [that are] desirable in the interests of employees.”29 U.S.C. § 1001. Indeed, we have repeatedly stated that ERISA is remedial legislation that should be construed liberally to “protect[ ] participants in employee benefits plans.” McElwaine v. U.S. West, Inc., 176 F.3d 1167, 1172 (9th Cir.1999) ; Batchelor v. Oak Hill Med. Grp., 870 F.2d 1446, 1449 (9th Cir.1989) ; Smith v. CMTA–IAM Pension Trust, 746 F.2d 587, 589 (9th Cir.1984).

We have developed ERISA federal common law furthering these interests several times before. See, e.g., Security Life Ins. Co. of America v. Meyling, 146 F.3d 1184, 1191 (9th Cir.1998) (recognizing under ERISA federal common law that a recission remedy exists when an insured makes material false representations about his health); Schikore v. BankAmerica Supplemental Ret. Plan, 269 F.3d 956 (9th Cir.2001) (invoking federal common law to incorporate the mailbox rule into ERISA). For example, we adopted the doctrine of reasonable expectations as a principle to apply when interpreting ERISA-governed insurance contracts. Saltarelli v. Bob Baker Grp. Med. Trust, 35 F.3d 382 (9th Cir.1994). In so holding, we reasoned that “protecting the reasonable expectations of insureds appropriately serves the federal policies underlying ERISA.” Id. at 386. Further, express incorporation of the principle elsewhere demonstrated “its widespread acceptance and vitality.” Id. at 387.⁴

There is nothing novel about the principle we adopt here that when a deadline falls on a weekend, it extends to the following business day. The Supreme Court recognized this general understanding in 1890. Street v. United States, 133 U.S. 299, 306, 10 S.Ct. 309, 33 L.Ed. 631 (1890) (“... a power that may be exercised up to and including a given day of the month may generally, when that day happens to be Sunday, be exercised on the succeeding day”). Further, the Fifth Circuit has stated that this “rubric has universal acceptance.” Armstrong v. Tisch, 835 F.2d 1139, 1140 (5th Cir.1988). LeGras faces the possibility of losing his long-term disability benefits because of a two-day difference in the computation of the time period to pursue an administrative appeal. Although the stricter time-computation method may be convenient for AETNA's purposes, it would be contrary to the purposes of ERISA to adopt a method that is decidedly protective of plan administrators, not plan participants.

Further, that a deadline extends to the next business day when it falls on a Saturday, Sunday, or holiday is widespread. For example, Federal Rule of Civil Procedure 6 (“Rule 6 ”) states that this principle applies to “any local rule or court order, or in any statute that does not specify a method of computing time.”⁵ Fed.R.Civ.P. 6(a).⁶ We have consistently applied Rule 6 when interpreting time periods in various statutory contexts. See, e.g., Minasyan v. Mukasey, 553 F.3d 1224, 1227–28 (9th Cir.2009) (addressing the beginning of the one-year period of limitations for filing an asylum application); Payan v. Aramark Mgmt. Servs. Ltd. P'ship, 495 F.3d 1119, 1125–26 (9th Cir.2007) (addressing the timeliness of a Title VII action after receipt of a right-to-sue letter from the Equal Employment Opportunity Commission); Patterson v. Stewart, 251 F.3d 1243, 1246 (9th Cir.2001) (addressing the “appropriate ending” of the one-year grace period under the Anti-terrorism and Effective Death Penalty Act of 1996); Cooper v. City of Ashland, 871 F.2d 104, 105 (9th Cir.1989) (per curiam) (holding that because the last day of Oregon's two-year statute of limitations in a personal injury suit under 42 U.S.C. § 1983 ended on the Saturday preceding Columbus Day, the plaintiff could file on the following Tuesday); Hart v. United States, 817 F.2d 78, 80 (9th Cir.1987) (holding that where the last day of the six-month limitations period under the Federal Tort Claims Act ended on a Saturday, the plaintiff could file on the following Monday). Additionally, many regulations explicitly incorporate this method for computing time.⁷

Incorporating this time-computation method into ERISA's federal common law protects the interests of...