Chauvin v. Symetra Life Ins. Co., CIVIL ACTION NO. 19-10493

• Decision Date: 25 October 2019
• Docket Number: CIVIL ACTION NO. 19-10493
• Parties: Mary Beth CHAUVIN v. SYMETRA LIFE INSURANCE COMPANY
• Court: U.S. District Court — Eastern District of Louisiana

422 F.Supp.3d 1145

Mary Beth CHAUVIN
v.
SYMETRA LIFE INSURANCE COMPANY

CIVIL ACTION NO. 19-10493

United States District Court, E.D. Louisiana.

Signed October 25, 2019
Filed October 31, 2019

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David C. Pellegrin, Pellegrin Firm, LLC, Metairie, LA, for Plaintiff.

Jennifer M. Lawrence, Krystil Borrouso Lawton, Lawrence Legal LLC, New Orleans, LA, for Defendant.

SECTION "L" (2)

ORDER & REASONS

Eldon E. Fallon, U.S. District Court Judge

Pending before the Court are Defendant's Motion to Dismiss and Motion for Summary Judgement. R. Docs. 16, 17. Each motion is opposed, R. Docs. 23, 24, and Defendant has filed replies, R. Docs. 29, 31. Because the motions are interrelated, the Court rules on them collectively as follows.

I. BACKGROUND

Plaintiff Mary Beth Chauvin filed this action against Defendant Symetra Life Insurance Company ("Symetra") challenging its denial of short and long term disability benefits under the Employee Retirement Income Security Act ("ERISA").¹ R. Doc. 9-2. Plaintiff alleges that through her employment with the Terrebone Parish School Board ("School Board"), she was a fully vested participant of an employee welfare plan administered by Defendant. R. Doc. 9-2 at 3.

Plaintiff has been disabled since December 2016 as a result of fibromyalgia, diabetes, anxiety, and depression. R. Doc. 9-2 at 3. According to Plaintiff, her treating physicians have certified that she is unable to work due to her disability, and the School Board considers her medically disabled. R. Doc. 9-2 at 3.

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Although the complaint does not specify the timing of the events, it appears as though Plaintiff submitted claims after the onset of her disability, which were denied by Defendant. See R. Doc. 9-2 at 3. Plaintiff alleges Defendant denied them without providing a full and fair review. R. Doc. 9-2 at 3. In particular, Plaintiff alleges Defendant failed to consider that continuing to work would exacerbate her disability and jeopardize her health. R. Doc. 9-2 at 3. Plaintiff further submits that, in denying her claims, Defendant was motivated by a financial conflict of interest. R. Doc. 9-2 at 4. Having appealed the denials of both her short and long term disability claims and thus exhausted her administrative remedies, Plaintiff now seeks enforcement of the policies and reasonable attorney fees under ERISA. R. Doc. 9-2 at 4-5. Plaintiff further seeks damages and attorney fees for Defendant's failure to timely pay benefits pursuant to Louisiana Revised Statute section 22:1821,² and for unpaid benefits, consequential damages, and attorney fees for breach of contract. R. Doc. 9-2 at 6.

Defendant timely answered the first amended complaint, admitting it issued and administered a disability policy to the School Board and denied Plaintiff's claims because it determined she was not disabled under the terms of the policy, but generally denying the other allegations. R. Doc. 10-2. In its defense, Defendant argues that because the School Board is a governmental entity, the disability plans are not governed by ERISA. R. Doc. 10-2 at 8. Defendant also contends it had just cause to deny Plaintiff's claims for both short and long term disability benefits. R. Doc. 10-2 at 8. In particular, Defendant alleges Plaintiff failed to provide written notice and proof of claims as required by the policies. R. Doc. 10-2 at 8. Defendant argues that even if the Court finds the plan is governed by ERISA, its "claims decisions were not arbitrary or an abuse of discretion," and that Plaintiff's state law claims are preempted by ERISA. R. Doc. 10-2 at 9. Defendant seeks attorney fees and costs related to the defense of this action. R. Doc. 10-2 at 9.

II. LAW & ANALYSIS

A. Defendant' Motion to Dismiss (R. Doc. 17)

Defendant filed a motion to dismiss for lack of subject matter jurisdiction. R. Doc. 17. Defendant argues that federal question jurisdiction is lacking because the disability policy at issue is not subject to ERISA, and that diversity jurisdiction is lacking because the terms of the policies expressly limit Plaintiff's potential recovery to an amount that cannot exceeded $75,000.³ R. Doc. 17-1.

In opposition, Plaintiff focuses only on diversity jurisdiction and objects to Defendant's method of calculating the amount in controversy. R. Doc. 24. Plaintiff provides her own calculation methodology and explains why the amount in controversy is greater than the jurisdictional minimum.⁴ R. Doc. 24. Further, Plaintiff urges this

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Court to exercise supplemental jurisdiction over her state law claims in the event the Court dismisses the ERISA claim and finds that diversity jurisdiction is lacking. R. Doc. 24 at 6.

1. Legal Standard – 12(b)(1)

"Federal courts are courts of limited jurisdiction. They possess only that power authorized by the Constitution and statute, which is not to be expanded by judicial decree." Kokkonen v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994) (citations omitted). Parties "may neither consent to nor waive federal subject matter jurisdiction." Simon v. Wal-Mart Stores, Inc. , 193 F.3d 848, 850 (5th Cir. 1999). Accordingly, "[a] case is properly dismissed for lack of subject matter jurisdiction when the court lacks the statutory or constitutional power to adjudicate the case." Home Builders Ass'n of Miss., Inc. v. City of Madison , 143 F.3d 1006, 1010 (5th Cir. 1998).

Federal Rule of Civil Procedure 12(b)(1) governs challenges to a district court's subject matter jurisdiction. Although "[t]he standard of review applicable to motions to dismiss under Rule 12(b)(1) is similar to that applicable to motions to dismiss under Rule 12(b)(6)," a 12(b)(1) motion can consist of either a facial attack on the pleadings or a broader, factual attack that examines matters outside the pleadings. Williams v. Wynne , 533 F.3d 360, 364-65 n. 2 (5th Cir. 2008). When a defendant makes a factual attack, "the district court must resolve disputed facts without giving a presumption of truthfulness to the plaintiff's allegations." Vantage Trailers, Inc. v. Beall Corp. , 567 F.3d 745, 748 (5th Cir. 2009). Accordingly, "[l]ack of subject matter jurisdiction may be found in any of one of three instances: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts." Ramming v. United States , 281 F.3d 158, 161 (5th Cir. 2001). "The burden of proof for a Rule 12(b)(1) motion to dismiss is on the party asserting jurisdiction." Id.

2. Federal Question Jurisdiction

Whether an employee benefit plan is governed by ERISA involves the merits of a plaintiff's claim, not a court's subject matter jurisdiction. See Smith v. Reg'l Transit Auth. , 756 F.3d 340, 344 (5th Cir. 2014). "A federal district court has jurisdiction to decide whether or not a plan is an ERISA plan" unless, of course, Plaintiff's claim is "so insubstantial [or] implausible ... as not to involve a federal controversy." Id. (quoting ACS Recovery Servs., Inc. v. Griffin , 723 F.3d 518, 523 (5th Cir. 2013) ). Plaintiff's claims clearly involve that denial of benefits under employee welfare plans. R. Doc. 12. Consequently, this Court has federal question jurisdiction over Plaintiff's ERISA claim at least insofar as to allow the Court to consider whether Plaintiff states a plausible claim for relief under the federal statute. The Court determines whether Plaintiff has done so momentarily, when it considers Defendant's motion for summary judgment.

3. Diversity Jurisdiction

Federal courts have original jurisdiction over matters involving state

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law claims when the parties are completely diverse and when the amount in controversy exceeds $75,000. 28 U.S.C. § 1332(a)(1). Complete diversity exists when no plaintiff shares a state of citizenship with any defendant. McLaughlin v. Mississippi Power Co. , 376 F.3d 344, 353 (5th Cir. 2004). Here, it is undisputed that complete diversity exists, as Plaintiff is a citizen of Louisiana and Defendant is a citizen of Washington state. R. Doc. 23 at 2. Nevertheless, Defendant argues that this Court lacks subject matter jurisdiction because the amount in controversy does not exceed $75,000. R. Doc. 17-1 at 12-19.

In general, a plaintiff's good faith assertion that the amount in controversy exceeds $75,000 sufficiently invokes diversity jurisdiction. St. Paul Reinsurance , 134 F.3d 1250, 1253 (5th Cir. 1998). However, a federal court must decline jurisdiction if it "appear[s] to a legal certainty that the claim is really for less than the jurisdictional amount." De Aguilar v. Boeing Co. , 47 F.3d 1404, 1409 (5th Cir. 1995) (quoting St. Paul Mercury Indem. Co. v. Red Cab Co. , 303 U.S. 283, 289, 58 S.Ct. 586, 82 L.Ed. 845 (1938) ). Further, "when a complaint does not allege a specific amount of damages, the party...