Rivera v. Union De Tronquistas De Puerto Rico Local 901

• Decision Date: 30 July 2015
• Docket Number: CIVIL NO.: 13-1949 (MEL)
• Court: U.S. District Court — District of Puerto Rico
• Parties: ANGEL VAZQUEZ RIVERA ET AL., Plaintiffs, v. UNION DE TRONQUISTAS DE PUERTO RICO LOCAL 901, ET AL., Defendants.

ANGEL VAZQUEZ RIVERA ET AL., Plaintiffs, v. UNION DE TRONQUISTAS DE PUERTO RICO LOCAL 901, ET AL., Defendants.

CIVIL NO.: 13-1949 (MEL)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO

July 30, 2015

OPINION AND ORDER

I. PROCEDURAL HISTORY

On December 26, 2013, Angel Vázquez Rivera ("Vázquez Rivera") and his wife Rosa I. Nieves Vega ("Nieves"), and the conjugal partnership shared between them (collectively "plaintiffs") filed a complaint against Unión de Tronquistas de Puerto Rico Local 901 ("Local 901"), and Hoffa Medical Center Plan de Salud y Bienestar de la Unión de Tronquistas de PR ("Hoffa"), alleging that Local 901 and Hoffa did not notify plaintiffs of their rights under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"), 29 U.S.C. § 1001 et seq. ECF No. 1. Plaintiffs amended the complaint on May 16, 2014 to add Plan de Pensiones Unión de Tronquistas as a defendant. ("Pension Plan")¹ (ECF. No. 21) and again on June 26, 2014 "to correct some grammatical mistakes and to specifically allege that two defendants are plan administrators" (ECF No. 54). ECF No. 50. On December 15, 2014, Local 901 and Hoffa filed a motion for summary judgment arguing that plaintiffs' COBRA claim should be dismissed because their alleged failure to notify was not in bad faith and plaintiffs did not suffer prejudiceresulting from the alleged failure to notify. ECF No. 70. Defendant Pension Plan filed a motion to join their co-defendants' motion for summary judgment. ECF No. 73. Plaintiffs filed a response to defendants' motion for summary judgment on December 25, 2014. ECF. No. 74. For the reasons that follow, defendants' motion for summary judgment is granted.

II. UNCONTESTED FACTS

Vázquez Rivera was an employee of Local 901. ECF No. 60, at ¶ 4; ECF No. 65, at ¶ 4. He and his wife, Nieves, were beneficiaries of his group health plan. ECF No. 54, at ¶ 9; ECF No. 60, at ¶ [10].² On January 22, 2013, Vázquez Rivera was discharged from his employment with Local 901. ECF No. 74-2, at 1, ¶ 4. Since being discharged Vázquez Rivera has not had medical insurance through his employer, Hoffa, or any other insurer. ECF No. 74-2, at 1, ¶ 4. Nieves also did not have medical insurance beginning on the date of Vázquez Rivera's discharge until October 1, 2013, when she individually obtained a medical insurance plan. ECF No. 74-3, at 1, ¶ 5. From January 22, 2013, to December 24, 2014,³ Vázquez Rivera did not visit or receive medical treatment from any doctor. ECF No. 71, ¶ 1; ECF No. 74-1, at 1, ¶ 1. However, Vázquez Rivera took some medications after June 2014.⁴ ECF. No. 74-2, at 2, ¶ 8. At least once during this period of non-coverage, Vázquez Rivera unsuccessfully applied for medical insurance. ECF 74-1, at 3, ¶ 4. He had dental problems and joint and body pain that were not treated because he did not have medical insurance. ECF 74-1, at 3, ¶ 5. Nieves also had medical conditions that were not treated.⁵ ECF 74-3, ¶ 3.

III. LEGAL STANDARD

The purpose of summary judgment "is to pierce the boilerplate of the pleadings and assay the parties' proof in order to determine whether trial is actually required." Wynne v. Tufts Univ. Sch. of Med., 976 F.2d 791, 794 (1st Cir. 1992). Summary judgment is granted when the record shows that "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "'A dispute is genuine if the evidence about the fact is such that a reasonable jury could resolve the point in the favor of the non-moving party. A fact is material if it has the potential of determining the outcome of the litigation.'" Farmers Ins. Exch. v. RNK, Inc., 632 F.3d 777, 782 (1st Cir. 2011) (quoting Rodríguez-Rivera-Martínez v. Federico Trilla Reg'l Hosp., 532 F.3d 28, 30 (1st Cir. 2008)).

The party moving for summary judgment bears the burden of showing the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the movant presents a properly focused motion "averring 'an absence of evidence to support the nonmoving party's case[,]' [t]he burden then shifts to the nonmovant to establish the existence of at least one fact issue which is both 'genuine' and 'material.'" Griggs-Ryan v. Smith, 904 F.2d 112, 115 (1st Cir. 1990) (quoting Garside v. Osco Drug., Inc., 895 F.2d 46, 48 (1st Cir. 1990)). For issues where the nonmoving party bears the ultimate burden of proof, that party cannot merely "rely on the absence of competent evidence, but must affirmatively point to specific facts" in the record "that demonstrate the existence of an authentic dispute." McCarthy v. Nw. Airlines, Inc., 56 F.3d 313, 315 (1st Cir. 1995). The plaintiff need not, however, "rely on uncontradicted evidence . . . . So long as the plaintiff's evidence is both cognizable and sufficiently strong to support a verdict in her favor, the factfinder must be allowed to determinewhich version of the facts is most compelling." Calero-Cerezo v. U.S. Dep't of Justice, 355 F.3d 6, 19 (1st Cir. 2004) (emphasis in original).

In assessing a motion for summary judgment, the court "must view the entire record in the light most hospitable to the party opposing summary judgment, indulging all reasonable inferences in that party's favor." Griggs-Ryan, 904 F.2d at 115 (citations omitted). There is "no room for credibility determinations, no room for the measured weighing of conflicting evidence such as the trial process entails, [and] no room for the judge to superimpose his own ideas of probability and likelihood . . . ." Greenburg v. P. R. Mar. Shipping Auth., 835 F.2d 932, 936 (1st Cir. 1987). The court may, however, safely ignore "conclusory allegations, improbable inferences, and unsupported speculation." Medina-Muñoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir. 1990) (citations omitted).

IV. LEGAL ANALYSIS

Where an employee participates in an employer's group health insurance plan, COBRA requires notice to employees and "qualified beneficiaries," including spouses and dependent children, of their option to continue health insurance coverage upon occurrence of a "qualifying event," including termination of employment. 29 U.S.C. §§ 1163(2), 1166(a)(2, 4), (b), (c). COBRA entitles qualified beneficiaries the option to continue receiving health insurance benefits for 18 months after the qualifying event. Id. § 1162(2)(A)(i). The notice requirement imposes a burden upon the employer to notify the plan administrator, if the administrator is a separate entity, of the occurrence of the qualifying event within 30 days of the event. 29 U.S.C. §1166(a)(2). The act then requires the plan administrator to notify the employee and qualified beneficiaries of their right to continued coverage under the plan within 14 days of the notice from the employer. 29 U.S.C. §1166(a)(4). If the employer and plan administrator are the sameentity, then the employer has 44 days from the date of the qualifying event to notify qualified beneficiaries of their right to coverage. 29 U.S.C. § 1166(a), (c); see also Rodríguez v. Int'l Coll. of Bus. & Tech., Inc., 364 F. Supp. 2d 40, 44-45 (D.P.R. 2005). Failure to notify a beneficiary of their rights under COBRA can make the plan administrator liable up to $110 per day in statutory penalties.⁶ 29 U.S.C. § 1132(c)(1); see also Torres Negrón v. Ramallo Bros. Printing, Inc., 203 F.Supp.2d 120, 125 (D.P.R. 2002) ("[I]f a plan administrator fails to provide requisite COBRA notice, the court has discretion to find the administrator . . . liable to the participant . . . for up to $110 a day from the date of the failure until the date of correction."). In an action for COBRA remedies, "the medical plan administrator bears the burden of proving that adequate COBRA notification was provided to qualified beneficiaries." Rodríguez, 364 F. Supp. 2d at 46.

Neither side has brought evidence to the court's attention with citations to the summary judgment record regarding whether plaintiffs are qualified beneficiaries, whether a qualifying event transpired, which entity or entities were the plan administrator, or whether the plan administrator provided timely notice to plaintiffs.⁷ Furthermore, no argument has been raised by plaintiffs or defendants as to any of these issues. Bearing in mind that defendants—the movants for summary judgment—bear the burden of establishing that COBRA notification was given, in the absence of any such evidence the court must operate under the presumption that defendants failed to provide proper notice for purposes of evaluating its summary judgment arguments.

The thrust of defendants' motion for summary judgment is that plaintiffs lack evidence that defendants acted in bad faith in failing to notify them of their COBRA and that the failure tonotify has not resulted in any prejudice to plaintiffs. Plaintiffs counter that they did suffer prejudice. They also argue that a showing of prejudice is not required for the imposition of COBRA remedies and that lack of bad faith and lack of prejudice are affirmative defenses for which defendants have the ultimate burden of proof.

Courts have broad discretion regarding whether to award statutory penalties for violations of 29 U.S.C. § 1166(a)(1). Kerkhof v. MCI WorldCom, Inc., 282 F.3d 44, 56 (1st Cir. 2002) ("The penalty provision expressly leaves it 'in the court's discretion' to determine whether penalties are appropriate for a failure to disclose." (citing 29 U.S.C. § 1132(c)(1)). "[A]lthough the district court need not find bad faith or prejudice to impose penalties, it may give weight—even dispositive weight—to these factors in the exercise of its discretion.". Kerkhof, 282 F.3d 55-56 (rejecting argument that it was error for district court to require a showing of bad faith or prejudice and affirming decision not to impose penalties pursuant to § 1132(c)(1) in the absence of a showing of either harm to the plaintiff or bad faith on the part of the plan...