Amara v. CIGNA Corp.
| Decision Date | 06 August 2020 |
| Docket Number | Civil No. 3:01-CV-2361 (JBA) |
| Court | U.S. District Court — District of Connecticut |
| Parties | JANICE C. AMARA et al., individually, and on behalf of others similarly situated, Plaintiffs, v. CIGNA CORP. and CIGNA PENSION PLAN, Defendants. |
Plaintiffs move "for an accounting that the Cigna Defendants have fully satisfied the judgment against them." ([Doc. # 591].) Defendants oppose. For the reasons described below, Plaintiffs' Motion is denied.
The Court assumes the parties' familiarity with this case's background and long history but will summarize the facts of this case insofar as they are relevant to the instant motion.
This case began in 2001 when Plaintiff Janet C. Amara, on behalf of herself and those similarly situated, brought suit against Defendants Cigna Corporation and the Cigna Pension Plan (collectively, "Cigna"), alleging that they had violated the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1022(a), 1024(b), and 1054(h) when switching from a defined benefit pension plan ("Part A") to a cash balance plan ("Part B"). Among the remedies requested was the appointment of a class action administrator or special master "to oversee implementation of remedies, with authority to make an accounting and take necessary steps to bring the Plan into compliance" and the ordering of an accounting of "over 9,700 participant records." (Pls.' Trial Memo [Doc. # 205] at 2, 4.)
In 2008, after a bench trial, the late Judge Mark R. Kravitz found in Plaintiffs' favor, see Amara v. Cigna Corp. ("Amara I"), 534 F. Supp. 2d 288 (D. Conn. 2008), and ordered damages in the amount of the sum of benefits each employee accrued under Part A and under Part B ("A + B relief"), see Amara v. Cigna Corp. ("Amara II"), 559 F. Supp. 2d 192 (D. Conn. 2008). Judge Kravitz ruled each eligible employee should be provided the benefits he or she had earned under Part A in the form available under Part A (), as well as the benefits he or she had accrued under Part B. Judge Kravitz did not order the appointment of a class action administrator or special master to oversee the payment process.
In 2011, the case was heard by the Supreme Court and remanded for the purposes of determining in the first instance whether remedies this Court awarded under Section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B), were appropriate under Section 502(a)(3) of ERISA, 29 U.S.C. § 1132(a)(3). See CIGNA Corp. v. Amara ("Amara III"), 563 U.S. 421 (2011). The case was subsequently transferred to the undersigned following Judge Kravitz's death. After remand, the parties submitted briefing on whether Plaintiffs were entitled to certain equitable remedies, ([Docs. ## 317, 321, 324]), and Plaintiffs again requested the appointment of "an independent fiduciary, a joint administrative committee with an independent member, or a special master," (Pls.' Supp. Br. Following Evid. Hearing [Doc. # 364] at 16-17). In its Ruling on Remedies, the Court again ordered A + B relief, but did not order the appointment of a monitor to oversee the implementation of remedies. ([Doc. # 378].) The both parties appealed aspects this ruling, but Plaintiffs did not raise the issue of monitoring. The Second Circuit affirmed on the Ruling on Remedies on December 23, 2014. See Amara v. CIGNA Corp. ("Amara IV"), 775 F.3d 510 (2d Cir. 2014).
In 2015, Plaintiffs moved for an order requiring Cigna to submit a compliance plan, containing "provisions for internal compliance audits and the supervision of implementation by a CIGNA executive officer," "[p]rocedures for quarterly reporting to Class counsel with full supporting data related to calculations of class members' increased benefits," and a "[p]rovision for the submission of a certified and audited final report on implementation by CIGNA's CEO to this Court demonstrating that CIGNA has fully and completely complied with the Court's Orders," among other things. (Pls.' Mem. Supp. Mot. Compliance Plan [Doc. # 412-1] at 9.) This Court denied this request on January 14, 2016. (Ruling on Proposed Methodology and Request for Order of Compliance Plan [Doc. # 459].) Although the Court recognized its "inherent authority" to issue an order "in aid of enforcement of its judgment," it also noted that its enforcement authority was "not limitless" and "'extend[ed] only as far as required to effectuate a judgment.'" (Id. at 20 (quoting Fafel v. Dipaola, 399 F.3d 403, 411 (1st Cir. 2005).) The Court determined that Plaintiffs' request was "premature," as "Defendants ha[d] not shown themselves to be noncompliant and indeed ha[d] not as yet had an opportunity to comply due to the issues around the methodology." (Id. at 21.)1
In 2019, Plaintiffs moved "that this Court grant their motion to enforce the Court's reformation and methodology rulings and sanction Cigna for calculating and paying individual remedy amounts under . . . interpretations . . . of this Court's orders that fail to comply with the Court's rulings." (Pls.' Mot. to Enforce J. and for Sanctions [Doc. # 571] at 1.) In their proposed order—but unmentioned in their supporting memorandum of law—Plaintiffs requested "an accounting" of the amounts "for each class member (and an accounting for the additional attorneys' fees to be separately paid . . .)" as a remedy. (Proposed Order on Mot. to Enforce J. and for Sanctions [Doc. # 571-2] at 2-3.) Without addressing this request for an accounting, the Court denied certain aspects of Plaintiffs' motion, concluding that Cigna was in compliance with the Revised Ruling on Proposed Methodology and Request for Order of Compliance Plan. ([Doc. # 579].) The Court stood by this conclusion when Plaintiffs subsequently moved for reconsideration. ([Doc. # 588].) Plaintiffs submitted notice of their appeal of the Court's enforcement and sanctions rulings, as well as other rulings, in January 2020. ([Doc. # 592].) That appeal remains pending before the Second Circuit.
On January 14, 2020, Cigna filed an "expedited motion" to discharge their supersedeas bond, which was slated for renewal on January 16, 2020. ([Doc. # 589] at 1.) Plaintiffs offered only conditional consent for this release, cross-moving "for an accounting that the Cigna Defendants have fully satisfied the judgment against them" to obviate any objection. ([Doc. # 591] at 1.) On January 16, 2020, the Court granted Cigna's motion to release its bond obligation, on the basis that "Cigna's appeal ha[d] been decided and Cigna ha[d] represented in its supporting brief . . . that the current amounts owed to Class Members ha[d] been remitted and the judgment satisfied." ([Doc. # 594] at 2.) The Court declined to rule on Plaintiff's cross-motion for accounting at that time, instead allowing the parties to brief the issue further and permitting Cigna to file a sur-reply. (See id. at 1 (); see also [Doc. # 604] (permitting sur-reply in response to Defendant's Motion to Strike [Doc. # 599]).)
Plaintiffs seek an "accounting by the Cigna Defendants" to both the class and the Court "showing that the Cigna Defendants have fully satisfied the judgment entered against them." (Pls.' Proposed Order on Mot. to Discharge Supersedeas Bond and Cross-Mot. for Accounting [Doc. # 590-1] at 1.)
Plaintiffs assert that an "accounting is required in equity for the discharge of fiduciary duties." (Pls.' Mem. Supp. Mot. for Accounting [Doc. # 590] at 1.) In their reply brief, Plaintiffs elaborate that they need not show that Defendant breached some duty, as the "fiduciary has an independent duty to account." (Pls.' Reply Mot. for Accounting [Doc. # 598] at 2 ).) Plaintiffs also assert that an accounting is appropriate here, because "even though there are at least $112 million in unpaid retirement benefits, the fiduciaries are only providing information related to implementation to entities and persons to whom no fiduciary duties are owed while refusing to supply the same information to the trust beneficiaries." (Id. at 5.) Plaintiffs contend that Cigna's representations as to the satisfaction of the judgment "are not only unverifiable, but inconsistent with the remedy calculations Cigna provided on January 18, 2019." (Id. at 7.) In support of this contention, Plaintiffs assert that "79% of the reformation's value is unaccounted for," as Cigna's "first through third quarter 2019 financial statements each give the value of the reformation" as $142 million, but "[b]ased on Cigna's representations, . . . the only benefit payments Cigna has made are almost $30 million' in back payments and small benefit cashouts," leaving $112 million unpaid. (Id.) Plaintiffs also assert that Cigna has not accounted for back benefits and past-due lump sums, including small-benefit cashouts, due to 1,000 participants. (Id. at 8.)2 Additionally, Plaintiffs contend that Cigna has "presented only incomplete and inconsistent information related to the implementation of relief" for 1,738 class members "whose annuities were increased by the reformation." (Id. at 8-9.) They further contend that "Cigna's presentation does not account at all for the status of implementation of the remedy" as to 2,600 class members who are now immediately eligible to collect benefits. (Id. at 9-10.) Finally, Plaintiffs assert that an accounting is warranted because Cigna "has admitted that it is excluding 'almost 10,000' people from any 'A+B' relief" and has not yet provided "meaningful explanation for the determination" or recognized "any right to contest them." (Id. at 10.)
Defendants respond that an accounting should not be required because "Class Counsel have not shown any systemic failures by Cigna to implement the A+B reformation remedy...
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