Geissal v. Moore Medical Corp.

• Decision Date: 29 March 2001
• Docket Number: No. 4:94 CV 1263 DDN.,4:94 CV 1263 DDN.
• Citation: 158 F.Supp.2d 976
• Parties: Bonnie L. GEISSAL, Plaintiff, v. MOORE MEDICAL CORP., Group Benefit Plan of Moore Medical Corp., and Herbert Walter<SMALL><SUP>1</SUP></SMALL>, Defendants.
• Court: U.S. District Court — Eastern District of Missouri

158 F.Supp.2d 976

Bonnie L. GEISSAL, Plaintiff, v. MOORE MEDICAL CORP., Group Benefit Plan of Moore Medical Corp., and Herbert Walter¹, Defendants.

No. 4:94 CV 1263 DDN.

United States District Court, E.D. Missouri, Eastern Division.

March 29, 2001.

S. Sheldon Weinhaus, Weinhaus & Dobson, St. Louis, MO, for plaintiff.

Kathi L. Chestnut, Edward M. Goldenhersh, Daniel J. Schwartz, Greensfelder & Hemker, St. Louis, MO, for defendant.

MEMORANDUM

NOCE, United States Magistrate Judge.

This action is before the court upon defendants' motion for partial summary judgment on Count I of plaintiff's complaint, specifically on the issue of damages (Doc. No. 139), and plaintiff's cross-motion for summary judgment on appropriate equitable relief (Doc. No. 139). The parties have consented to the exercise of authority by the undersigned United States Magistrate Judge pursuant to 28 U.S.C. § 636(c).

Plaintiff James Geissal commenced this action in June 1994, alleging four counts under the Employee Retirement Income Security Act ("ERISA"), amended by the Comprehensive Omnibus Budget Reconciliation Act of 1986 ("COBRA"). Defendants are plaintiff's former employer, Moore Medical Corporation ("Moore"), Group Benefit Plan of Moore Medical Corporation, and Herbert Walter, the Plan Administrator.

Plaintiff alleged four counts for relief. Count I alleged that defendants violated COBRA by failing to provide him with continuation coverage after Moore terminated his employment. Count II alleged that Moore was estopped from denying him COBRA coverage because plaintiff relied on its initial representation that he was entitled to COBRA coverage. Count III alleges that defendants waived any differing construction or interpretation of plan provisions. Count IV alleges that Herbert Walter, the Plan Administrator, failed to provide requested documents in violation of 29 U.S.C. § 1024(b)(4).

Plaintiff has moved for partial summary judgment. In March 1996, this court denied plaintiff's motion for partial summary judgment and sua sponte granted partial summary judgment for defendants.² Geissal v. Moore Medical Corp., 927 F.Supp. 352, 361 (E.D.Mo.1996). The Eighth Circuit affirmed on interlocutory appeal. Geissal v. Moore Medical Corp., 114 F.3d 1458 (8th Cir.1997). However, the United States Supreme Court vacated the opinion of the Eighth Circuit and remanded the case. Geissal v. Moore Medical Corp., 524 U.S. 74, 118 S.Ct. 1869, 141 L.Ed.2d 64 (1998).

Plaintiff then moved for reconsideration of the court's ruling on plaintiff's earlier motion for partial summary judgment. In March 1999, the court granted plaintiff's motion and determined that defendant Moore Medical Corporation was obligated to provide COBRA coverage to James Geissal, but that plaintiff's entitlement to other relief would have to await the conclusion of any trial or other factfinding conducted by the court. See Order and Memorandum, filed March 23, 1999 (Doc. No. 83). In September 1999, the court ordered the parties to file cross-motions for partial summary judgment on certain liability issues. See Order, filed Sept. 23, 1999 (Doc. No. 119).

The Court must grant summary judgment if the pleadings, admissions, stipulations, depositions and affidavits demonstrate that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Fed. R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Board of Educ., Island Trees Union Free School Dist. No. 26 v. Pico, 457 U.S. 853, 863, 102 S.Ct. 2799, 73 L.Ed.2d 435 (1982) (plurality opinion). The moving party must initially demonstrate the absence of an issue for trial. Celotex, 477 U.S. at 323, 106 S.Ct. 2548. Any doubt as to the existence of a material fact must be resolved in favor of the party opposing the motion. Pico, 457 U.S. at 863, 102 S.Ct. 2799.

Once a motion is properly made and supported, the non-moving party may not rest upon the allegations in the pleadings but must instead demonstrate the existence of admissible evidence of specific facts showing that there is a genuine issue of material fact for trial. Fed.R.Civ.P. 56(e); Buford v. Tremayne, 747 F.2d 445, 447 (8th Cir.1984). Although the court views the facts in the light most favorable to the non-moving party, "in order to defeat a motion for summary judgment, the non-movant cannot simply create a factual dispute; rather, there must be genuine dispute over those facts that could actually affect the outcome of the lawsuit." Webb v. Lawrence County, 144 F.3d 1131, 1135 (8th Cir.1998).

For the convenience of the parties, the court will restate the undisputed facts which the court set forth in its March 23, 1999 ruling:

"1. On July 16, 1993, Moore Medical Corporation terminated James Geissal from employment. At the time of his termination, Geissal was 62 years old and had cancer. During his employment at Moore, Geissal was a participant in a health benefits plan, the Group Benefit Plan of Moore Medical Corp., sponsored by Moore for its employees.

"2. Moore Medical Corp. is an employer and the plan sponsor within the meaning of 29 U.S.C. § 1102(5) and (16)(B), of defendant Group Benefit Plan of Moore Medical Corp. (the Plan). The Plan is an employee welfare benefit plan as defined in 29 U.S.C. § 1002(1). Defendant Group Benefit Plan of Moore Medical Corp. provides for the payment and reimbursement to plan participants of various medical expenses and is a group health plan as defined in 29 U.S.C. § 1167(1).

"3. While Geissal was employed at Moore, his wife, Bonnie, was employed by Trans World Airlines (TWA). By reason of Bonnie Geissal's employment at TWA, James Geissal was a covered dependent eligible for coverage under the health insurance policy issued by Aetna Life Insurance Company. Aetna was the health provider or third-party administrator under the TWA plan provided by TWA for its employees. Geissal's coverage through his wife's plan preceded Geissal's termination by Moore.

"4. Upon Geissal's termination at Moore Medical, Geissal received a notice of his right under COBRA to continue health insurance coverage under Moore's benefit plan. He accepted Moore's offer and elected to continue receiving group health coverage under Moore's Plan. He began making premium payments, which the defendants accepted. Approximately six months after his termination, by letter dated January 27, 1994, defendants informed Geissal that they had determined he was not entitled to COBRA coverage because he was already covered under a group policy with Aetna. Geissal was told that the premiums he had already paid would be returned and that those who provided him with medical care during that period would not be paid by the Plan.

"5. Moore's plan had an annual deductible of $150. It also provided for a lifetime maximum amount of benefits. TWA's plan through Aetna had an annual deductible of $500 per year per person and also provided a lifetime maximum amount of benefits.

"6. At the time Geissal was terminated, he requested and received a service letter pursuant to Missouri Revised Statute § 290.140. At the time he was terminated, he considered whether he should consult an attorney to investigate what rights and claims he might have against Moore because he felt he had been unfairly terminated. Geissal decided not to do so, because his main concern was that he have full and adequate health insurance. Moore representatives encouraged him to make the COBRA election, which did much to assuage his feelings about his discharge. At about this time, and shortly after the issuance of the service letter, the Plan or its reinsurer were making large payments for medical care provided to Geissal prior to his termination. Because he was offered the COBRA continuation coverage, Geissal did not look for another insurance carrier."

Order and Memorandum, at 2-3.

Arguments in Support of Both Parties' Motions

In support of their motion for partial summary judgment, defendants argue that plaintiff's damages are limited to Geissal's unreimbursed out-of-pocket medical expenses that would have been covered under the Moore Plan had he been provided with COBRA continuation coverage, less deductibles and premium payments due Moore for such coverage. Defendants argue that the reason for this is that TWA/Aetna covered much of plaintiff's expenses. Any claim that TWA/Aetna may have had on Geissal's estate is barred by the applicable statute of limitations. Therefore, to allow plaintiff to recover for benefits paid by TWA/Aetna that TWA/Aetna is not able to then recover from plaintiff would present a windfall to the plaintiff, which is prohibited.

Defendants claim that Mr. Geissal's unreimbursed out-of-pocket medical expenses, which would have been covered under the Moore Plan, were $2,614.08. Defendants then claim that the amount of deductibles, copayments and premium payments that Geissal would have been required to pay for COBRA continuation coverage under the Moore Plan would have been $2,973.18. Therefore, defendants argue, because the sum of the continuation coverage premiums and deductibles exceeds plaintiff's unreimbursed out-of-pocket medical expenses by $359.10, plaintiff suffered no damages and that summary judgment should be granted in favor of defendants on the issue of damages.

In her combined memorandum, plaintiff argues that defendants have been unjustly enriched by the failure of the Moore Plan to provide benefits to Mr. Geissal. Therefore, plaintiff argues, she is entitled to "other appropriate equitable relief," as provided by 29 U.S.C. § 1132(a)(3), in the form of restitution.

Plaintiff disputes defendant's argument that TWA/Aetna would be unable to recover any money from Geissal's estate. She argues that because ERISA preempts Missouri law, nothing in Missouri law could stop TWA/Aetna from bringing an ERISA action against the estate for the enforcement of an equitable lien or the creation of a...