Miller v. Disability Plan

• Decision Date: 25 June 2010
• Docket Number: Civil Action No. 09-1166.
• Parties: Arlene MILLER, Plaintiff, v. MELLON LONG TERM DISABILITY PLAN, et al., Defendants.
• Court: U.S. District Court — Western District of Pennsylvania

721 F.Supp.2d 415

Arlene MILLER, Plaintiff,

v.MELLON LONG TERM DISABILITY PLAN, et al., Defendants.

Civil Action No. 09-1166.

United States District Court,W.D. Pennsylvania.

June 25, 2010.

COPYRIGHT MATERIAL OMITTED.

Wayne J. Schaefer, Law Offices of Wayne J. Schaefer, LLC, Smithtown, NY, for Plaintiff.

Daniel E. Wille, John C. Unkovic, Reed Smith LLP, Pittsburgh, PA, for Defendants.

OPINION

LENIHAN, United States Magistrate Judge.

Currently before the Court for disposition are three motions: (1) a Motion to Dismiss (Doc. No. 9) filed by Defendants Mellon Bank, N.A., Mellon Financial Corporation, The Bank of New York Mellon Corporation, Corporate Benefits Committee, and Sheila Miller (the “Mellon Defendants”); (2) a Motion to Dismiss (Doc. No. 23) filed by Life Insurance Company of North America (“LINA”) and CIGNA Corporation (“CIGNA”) (together the “Insurance Defendants”); and (3) a Motion for Leave to File an Amended Complaint (Doc. No. 34) filed by Plaintiff, Arlene Miller. This case is brought pursuant to Section 502(a)(1)(B) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), 29 U.S.C. §§ 1001, 1132(a)(1)(B), for review of a denial of long-term disability benefits and determination of her rights to past and future benefits under the terms of her employer's long-term disability plan. This Court has subject matter jurisdiction over this action pursuant to 29 U.S.C. § 1132(e)(1). Venue in this District is proper under 29 U.S.C. § 1132(e)(2).

For the reasons set forth below, the Court finds it would be futile to allow Plaintiff to file the proposed amended complaint with one exception, and therefore, will grant in part and deny in part Plaintiff's Motion for Leave to File an Amended Complaint (Doc. No. 34). Accordingly, the motions to dismiss are not moot. In consideration of the pleadings, motions and supporting papers filed in this case, the Court will grant the Mellon Defendants' Motion to Dismiss (Doc. No. 9) as to Mellon Bank, N.A., Mellon Financial Corporation, The Bank of New York Mellon Corporation, the Corporate Benefits Committee, and Sheila Miller, on all Counts. In addition, the Court will grant the Insurance Defendants' Motion to Dismiss (Doc. No. 23). Finally, the Court will grant the Motions to Dismiss Plaintiff's Demand for a Jury Trial filed by all of the Defendants.

I. FACTUAL BACKGROUND/PROCEDURAL HISTORY

Because this action comes before the Court on a motion to dismiss, the Court must accept as true all of Plaintiff's allegations of fact and must view the facts in the light most favorable to her. The relevant facts are as follows.

Arlene Miller (hereinafter “Plaintiff”) is a participant in the Defendant Mellon Long-Term Disability Plan (hereinafter “Plan”), ¹ an employee welfare benefit plan that provides disability benefits. (Mellon Long-Term Disability Plan Summary Plan Description dated January 2004 (“SPD”) at 25. ² ) Thus, the Plan constitutes an “employee welfare benefit plan” within the meaning of 29 U.S.C. § 1002(1). The Plan is funded through a trust established by Mellon Bank, N.A., to make long-term disability (“LTD”) benefit payments. (SPD at 26; Plan at Preamble.) The trust constitutes the sole source of benefits under the Plan. (Plan at Preamble.)

Defendant Corporate Benefits Committee (hereinafter “CBC”) was the Plan Administrator of the Mellon Long-Term Disability Plan until July 2009, when it was dissolved. ³ (Plan at § 5.l; SPD at 25.) Defendant Sheila Miller acted as the “Plan Manager” and, as such, was responsible for the day-to-day administration of the Plan. (Plan at § 1.25.)

Defendant Mellon Bank, N.A., is named as the “Plan Sponsor” in § 1.3 of the Plan, as well as in the SPD. ⁴ Defendant Mellon Financial Corporation is described in the Plan Document as a Pennsylvania Corporation of which the CBC is a part. (Plan at §§ 1.9, 1.12.) Defendant The Bank of New York Mellon Corporation (“BNY Mellon Corp.”) was created in May 2007 as a result of a merger between Mellon Financial Corporation and The Bank of New York Company, and, by virtue of which, is the successor-in-interest to Mellon Financial Corporation. Thus, Mellon Financial Corporation ceased to exist on July 1, 2007 when BNY Mellon Corp. was formed. In addition, Mellon Bank, N.A. changed its name to BNY Mellon, National Association, effective July 1, 2008. Thus, the Plan Sponsor at the time this litigation was commenced appears to be BNY Mellon, N.A., which is not named as a defendant in this litigation.

Defendant LINA was retained by the Plan to provide ministerial services, such as information collection on an as-requested basis. (Compl.¶ 7.) Defendant CIGNA Corporation was designated as the claims administrator and, as such, performed certain claims administrative functions for the Plan. (SPD at 25.)

On or about February 2004, the Plaintiff began receiving short-term disability benefits. Upon the expiration of her eligibility for short-term benefits, the Plaintiff applied to the Plan for long-term disability (“LTD”) benefits. Plaintiff's claim was initially denied. However, on June 20, 2005, the Plaintiff was advised by letter, that the CBC had reversed the denial, and directed that monthly benefits be paid in the amount of $2,210.83. The monthly benefits would continue for a period of two years, retroactive to August 30, 2004. The letter also advised the Plaintiff that CIGNA would be conducting a subsequent review of her claim to determine whether she would be entitled to receive benefits as of August 30, 2006, the two year anniversary of her initial benefit eligibility date.

Section 2.3 of the Plan provides that a participant is considered “Totally Disabled” following the two year anniversary if she is “wholly and continuously unable” to engage in any occupation or perform any work for compensation or profit for which he is or may become reasonably fitted by education, training, or experience. (Plan at 8.) ⁵

On September 22, 2006, CIGNA recommended that the Plan deny further benefits because of a purported failure by the Plaintiff to provide further medical evidence. Defendant Sheila Miller, by letter dated October 12, 2006, advised the Plaintiff that no benefits were payable as of October 15, 2006, based on her failure to provide further medical evidence indicating that as of August 30, 2006, she was disabled within the meaning of the “any occupation” standard set forth in § 2.3(b) of the Plan. In response, on March 15, 2007, Plaintiff appealed the determination to the CBC. By letter dated April 17, 2007, Sheila Miller indicated that the CBC had received the Plaintiff's appeal. On October 29, 2007, the CBC advised the plaintiff that her appeal was denied and that her claim for benefits was deemed terminated as of October 12, 2007.

On August 28, 2009, Plaintiff instituted the present litigation, pursuant to Section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B), seeking payment of monies allegedly due to her under the terms of the Plan, and judgment directing Defendants to honor the Plaintiff's alleged entitlement to future disability benefits under the terms of the Plan. The Plaintiff specifically contends that Defendants' determination terminating disability benefits ignored lay and medical evidence in Plaintiff's administrative file; contradicted defendants' own previous determination that the medical evidence was sufficient to establish that Plaintiff was entitled to benefits; ignored and disregarded the debilitating effect plaintiff's disability had on her ability to respond to requests for medical information and to provide medical information; ignored medical evidence establishing that plaintiff was disabled within the meaning of the “any occupation” standard set forth in § 2.3(b) in the Plan Document; failed to request Plaintiff submit to medical, psychological, or functional capacity examinations; and, ignored additional indicia of disability as evidenced by the award of social security disability benefits in August of 2005. (Compl., ¶¶ 39, 44-45.)

In response, the Mellon Defendants filed a Motion to Dismiss and supporting brief on January 12, 2010. The Insurance Defendants also responded by separately filing a Motion to Dismiss and supporting brief on February 12, 2010. ⁶ In essence, the Mellon Defendants and Insurance Defendants (collectively, the “non-Plan Defendants”) contend that they are improper parties in a denial of benefits claim under 29 U.S.C. § 1132(a)(1)(B), and therefore, request that the Complaint as to them be dismissed with prejudice. The non-Plan Defendants, as well as Defendant Mellon Long Term Disability Plan, also move the Court to dismiss the Plaintiff's demand for a jury trial, contending that Plaintiff has no right to a jury trial under ERISA. The Plaintiff filed briefs in opposition to both motions to dismiss on March 3, 2010. The Defendants filed reply briefs in support of their respective motions to dismiss on March 23, 2010.

While the motions to dismiss were pending, Plaintiff filed a Motion for Leave to File an Amended Complaint (Doc. No. 34) on April 2, 2010, which attempts to address the arguments raised by the Defendants in their motions to dismiss. Defendants have filed a response objecting on the basis that it would be futile to allow the proposed amendments. The motions, having been fully briefed and responded to, are now ripe for disposition.

II. MOTION FOR LEAVE TO FILE AN AMENDED COMPLAINT A. Standard of Review

Rule 15(a) of the Federal Rules of Civil Procedure provides that leave to amend a pleading “shall be freely given when justice so requires.” In Foman v. Davis, the Supreme Court delineated the grounds that would justify denying leave to amend: “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, [and] futility of amendment”. Foman v....