Olick v. Kearney

• Decision Date: 11 September 2006
• Docket Number: Civil Action No. 06-1531.
• Parties: Thomas W. OLICK, Plaintiff, v. James KEARNEY, et al., Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

451 F.Supp.2d 665

Thomas W. OLICK, Plaintiff, v. James KEARNEY, et al., Defendants.

Civil Action No. 06-1531.

United States District Court, E.D. Pennsylvania.

September 11, 2006.

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Thomas W. Olick, Easton, PA, pro se.

Thomas W. Dymek, Leslie Miller Greenspan, Stradley Ronon Stevens & Young LLP, Philadelphia, PA, Franco A. Corrado, Frederick P. Santarelli, Elliot Greenleaf & Siedzikowski P.C., Blue Bell, PA, for Defendants.

MEMORANDUM AND ORDER

KATZ, Senior Judge.

I. Introduction

Before the court are the Motion to Dismiss of Defendants James Kearney, Thomas Jenkins, and the Knights of Columbus, and Defendant Aetna's Motion to Dismiss Plaintiffs June 26, 2006 Amended Complaint (Plaintiffs Fourth Amendment), and the Plaintiffs response thereto.¹ For the reasons set forth below, both Motions are granted in part and denied in part.

II. Facts

In June 1995, Plaintiff Thomas Olick entered into an employment contract ("the Contract") with Defendant Knights of Columbus ("Knights") whereby Knights authorized Plaintiff to sell its insurance products to members of five Knights of Columbus Councils.² See Amended Compl., ¶¶ 10, 14. Shortly after signing the Contract, Plaintiff became eligible for and purchased group health insurance for his wife and children from Defendant Aetna Life Insurance Company ("Aetna"). Id. ¶ 35. Plaintiff paid all required premiums for this insurance until February 15, 2006. Id. ¶ 36.

Beginning in February 2005, Plaintiffs relationship with Knights, and especially with Defendant James Kearney ("Kearney"), Knights' general agent, began to sour. Plaintiff alleges that, over the next year, Defendants Knights and Kearney reduced Plaintiffs sales territory without reducing his sales quota, id. ¶¶ 120, 126, 128, and acted in numerous other ways to sabotage his sales efforts (e.g., by withholding information regarding Plaintiffs territory, failing to inform Plaintiff of his customers' overdue premiums, punishing Plaintiff for his opposition to illegal sales practices, and refusing to approve policies written by Plaintiff). Id. ¶¶ 129, 131, 133, 138, 142, 145, 147, 152, 157, 169, 176, 179, 181, 183, 189. Plaintiff further alleges that Knights improperly reduced his commissions on two occasions, id. ¶¶ 292, 294-297, and that Defendant Thomas Jenkins ("Jenkins"), a fellow Field Agent for Knights, unlawfully took over his former sales territory and interfered with his sales efforts. Id. ¶¶ 152, 181, 183.

Despite these clashes with his colleagues and superiors, Plaintiff claims that he was never formally terminated, id. If 90, and thus never became ineligible for his group health insurance. Yet the COBRA Notice (dated February 28, 2006) that Plaintiff received from Knights on March 1, 2006 indicates that Plaintiff was fired on November 1, 2005. Id. ¶ 37, Exhibit 3. In any case, Plaintiff alleges that after March 1, 2006, Defendant Aetna informed Plaintiff that he and his family were no longer covered and refused to pay more than $3,000 in medical bills that should have been covered by his group health insurance plan. Id. ¶¶ 49-51, 81. Soon thereafter, Plaintiff appealed Aetna's claims decisions orally and in writing, but received no response. Id. ¶¶ 52-57.

Plaintiffs first Complaint was filed on February 15, 2006 in the Court of Common Pleas for Northampton County against Knights and Kearney. On March 13, before Defendants responded, Plaintiff amended the Complaint to add Aetna as a Defendant. On April 3, Plaintiff amended his Complaint again; on April 11, Aetna, with the consent of Knights and Kearney, removed the action to this court. On April 26, Plaintiff filed a new Complaint without leave of court, and that Complaint was stricken on June 5. The Amended Complaint at issue here, which added Jenkins as a Defendant, was filed on June 26.

The Amended Complaint consists of eight counts: (1) violations of ERISA and COBRA, (2) breaches of fiduciary duty under ERISA, (3) breaches of contract, including breaches of the implied covenant of good faith and fair dealing, (4) tortious interference with contract, (5) retaliation and unfair insurance practices, (6) age discrimination and retaliation, (7) "job discrimination," and (8) conversion and breach of contract.

III. Standard of Review

A motion to dismiss pursuant to FED. R.CIV.P. 12(b)(6) tests the legal sufficiency of the complaint. See Jodek Charitable Trust, R.A. v. VerticalNet, Inc., 412 F.Supp.2d 469, 474 (E.D.Pa.2006) (citing Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir.1993)). In considering the motion, the court must accept as true all allegations in the complaint and all reasonable inferences that can be drawn from them when viewing them in the light most favorable to the non-movant, see Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994), but the court need not credit bald assertions or legal conclusions. See Morse v. Lower Merlon Sch. Dist., 132 F.3d 902, 906 (3d Cir.1997). Moreover, the court should look only to the facts alleged in the complaint and its attachments without reference to other parts of the record. See Jordan, 20 F.3d at 1261. The court should grant the motion only if it "appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957).

IV Discussion

A. Count I—ERISA and COBRA Claims

In Count I of the Complaint, Plaintiff sets forth claims against, Defendants Knights of Columbus ("Knights") and Aetna Life Insurance Company ("Aetna") under the Employee Retirement Income Security Act of 1974 ("ERISA"), 88 Stat. 829, as amended, 29 U.S.C. § 1001 et seq. (2006), and the Consolidated Omnibus Budget Reconciliation Act of 1985 ("CBRA"), 100 Stat. 227, as amended, 29 U.S.C. § 1161 et seq. (2006).

1. ERISA Claims Against Knights and Aetna

Plaintiff sets forth two ERISA claims against Defendants Knights and Aetna. First, Plaintiff alleges that, under § 502(a)(1)(B) of ERISA, Knights and Aetna are liable for approximately $3,000 in medical expenses for which coverage was refused between November 1, 2005 and March 1, 2006. See Amended Compl., 1181. Second, Plaintiff alleges that ERISA (presumably § 502(a)(3)(B) thereof) requires that Knights and Aetna return all premiums paid by Plaintiff after November 1, 2005. See id. ¶ 85.

a. The 502(a)(1)(B) Claims

With regard to Plaintiffs § 502(a)(1)(B) claim against Aetna, Defendant's motion is denied without prejudice with leave to renew by motion for summary judgment at the close of discovery. Under § 502(a)(1)(B), a participant or beneficiary of a group health plan may sue "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B) (2006). Here Plaintiff has alleged that Aetna has improperly refused to cover his medical expenses, so his claim should not be dismissed at this time.³

Plaintiffs § 502(a)(1)(B) claim against Knights must be dismissed with prejudice, however, because Knights, the plan administrator,⁴ is not a proper defendant. Courts have disagreed on this point, but, in the absence of binding precedent, this court believes the better view is that a "plan administrator" (like Knights) is not a proper defendant under § 502(a)(1)(B). See Guiles v. Metropolitan Life Ins. Co., No. Civ. A. 00-5029, 2002 WL 229696 (E.D.Pa. Feb.13, 2002) (so holding and distinguishing Curcio v. John Hancock Mut. Life Ins. Co., 33 F.3d 226 (3d Cir.1994)).

b. The § 502(a)(3)(B) Claims

With regard to Plaintiff's § 502(a)(3)(B) claims against Knights and Aetna for reimbursement of premiums paid after November 1, 2005, Defendants' motions are denied without prejudice with leave to renew by motion for summary judgment, at the close of discovery. Under § 502(a)(3)(B), a group health plan participant (like Plaintiff) may sue "to obtain other appropriate equitable relief (i) to redress [any act or practice which violates any provision of this subchapter or the terms of the plan]," 29 U.S'.C. § 1132(a)(3)(B) (2006), and such a participant is not required to exhaust administrative remedies. See Zipf v. Am. Tel. & Tel. Co., 799 F.2d 889, 891 (3d Cir.1986). Moreover, both the plan administrator (Knights) and the plan itself (Aetna) are proper defendants in a claim under § 502(a)(3)(B). See Curcio, 33 F.3d at 234. Plaintiffs claim therefore turns on whether Plaintiffs coverage ended on November 1, 2005. If so, Plaintiff is entitled to reimbursement of premiums paid after that date, because she was no longer eligible for the plan.⁵ If not, Plaintiff is not entitled to reimbursement. Given the parties' conflicting assertions regarding when Plaintiff was terminated, Knights and Aetna's motions to dismiss these claims are denied without prejudice with leave to renew by motion for summary judgment at the close of discovery. Compare Amended Compl., ¶90 (denying that Plaintiff was ever formally terminated) with Amended Compl., Exhibit 3 (Knights' COBRA Notice—indicating that Plaintiff was terminated on November 1, 2005).

2. COBRA Claims Against Knights and Aetna

Plaintiff also alleges that Defendants Knights and Aetna violated §§ 502(a)(1)(A) and 606(a)(4) of COBRA by failing to timely give Plaintiff (and his spouse and children) the statutorily required notice of their right to elect continuing coverage after Plaintiffs alleged termination. See Amended Compl., ¶¶ 37, 38, 82, 83.

Aetna's motion to dismiss is granted, because, in this case, Aetna is not a proper defendant under §§ 502(a)(1)(A) and 606(a)(4) of COBRA. Section 502(a)(1)(A) permits a group health plan participant (like Plaintiff) to sue "for the relief provided for in subsection (c) of this section," and § 502(c)(1)(A) allows Plaintiff to sue "[a]ny administrator ...