Summary
In Randa v. VPA Inc., the court addressed defendant VPA's argument that it should be dismissed as a defendant because a section 1132(a)(1) claim can only be brought against the plan.
Summary of this case from Daniel R. v. UMROpinion
Case No. 03-1288JTM
March 31, 2004
ORDER
This matter comes before the court on defendant VPA Inc.'s (VPA) motion to dismiss Plaintiff's complaint (Dkt. No. 6). Plaintiff brings this action under the Employee Retirement Income Security Act (ERISA) of 1974, 29 U.S.C §§ 1001 et. seq., seeking a judgment that she is eligible for long term disability benefits. The motion to dismiss is briefed and ripe for disposition. For the reasons stated below, the court denies the motion to dismiss.
I. Plaintiff's complaint
The following allegations are taken from the Plaintiff's complaint.
Plaintiff is a beneficiary under the Tricon Long Term Disability Plan (the Plan). The Plan is a long term disability group insurance policy issued to KFC, which provided coverage to plaintiff while she was an employee of KFC. VPA is the claims administrator for the Plan with exclusive authority to determine all questions of eligibility for benefits under the Plan.
On or about June 19, 2000, while an employee of KFC, plaintiff became disabled and eligible for long term disability benefits under the Plan. By the terms of the Plan, plaintiff is entitled to the amount of $4,175.20 for each month following an elimination period for which she remains disabled as defined in the policy.
VPA authorized benefits payments from March 12, 2001 to August 1, 2002 but has denied authorization for benefit payments for any benefit periods after August 1, 2002. VPA failed in its duty to provide a full and fair review as required by ERISA. VPA's denial is arbitrary and capricious, not supported by substantial evidence in the record, and is erroneous as a matter of law.
II. Standard
"A Rule 12(b)(6) motion to dismiss will be granted only if it appears beyond a doubt that the plaintiff is unable to prove any set of facts entitling [him] to relief under [his] theory of recovery." Id. (citing Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). "The court must accept all the well-pled allegations of the complaint as true and must construe them in the light most favorable to the plaintiff." Boyd v. Runyon, 1996 WL 294330 at *1 (D.Kan. 1996) (citing Williams v. Meese, 926 F.2d 994 (10th Cir. 1991). "The [c]ourt, however, need not accept as true those allegations that are conclusory in nature, i.e., which state legal conclusions rather than factual assertions." Fugate v. Unified Government of Wyandotte, 161 F. Supp.2d 1261, 1263 (D.Kan. 2001) (citing Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991)).
III. Analysis
Defendant VPA argues claims to recover benefits under ERISA 29 U.S.C. § 1132(a)(1) may only be filed against the Plan. Plaintiff brings claims against both the Plan and the claims administrator of the Plan. Defendant VPA, the claims adminstrator, argues it is an improper party. Plaintiff argues defendant VPA qualifies as a fidiuciary and as such is a necessary party to this lawsuit.
In Varity Corp. v. Howe, 516 U.S. 489, 507-15 (1996), the Supreme Court found ERISA authorizes suits for individualized equitable relief for breach of fiduciary duty. 29 U.S.C. § 1002(21)(A) provides the definition of a fiduciary under the ERISA statute:
Except as otherwise provided in subparagraph (B), a person is a fiduciary with respect to a plan to the extent (i) he exercises any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets, (ii) he renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan, or has any authority or responsibility to do so, or (iii) he has any discretionary authority or discretionary responsibility in the administration of such plan. Such term includes any person designated under section 1105(c)(1)(B) of this title.
Claims administrators may qualify as fiduciaries if they "exercise discretionary control over the management or administration of the plan or render investment advice for a fee or other compensation." Airports Co., Inc. v. Custom Ben. Services of Austin, Inc. , 828 F. Supp. 870. 875 (D. Kan 1993) rev'd on other grounds by 28 F.3d 1062. On the other hand, courts generally find claims administrators who perform only ministerial tasks do not qualify as fiduciaries. CSA 401(K) Plan v. Pension Professionals, Inc., 195 F.3d 1135 (9th Cir. 1999). See also 828 F. Supp. at 875 (finding consultant to plans administrators was not a fiduciary because consultant "did not exercise management or administrative control over the pension plan.").
Accordingly, the court must consider whether defendant VPA exercised discretionary control over the Plan or rendered investment advice for a fee or compensation. The parties submitted only the pleadings for consideration in conjunction with this motion. The complaint provides very little detail about defendant VPA's role as claims administrator. Construing the complaint's allegations in the light most favorable to plaintiff, the court accepts the premise that defendant VPA possessed authority to determine all questions of eligibility regarding benefits. This allegation indicates defendant WA possessed and exercised discretionary control over the Plan. The discovery process may show defendant VPA performed only ministerial tasks, and if so defendant VPA would not qualify as a fiduciary. However, at this stage in the proceedings, the court finds plaintiff made adequate allegations concerning defendant WA to defeat the motion to dismiss.
Defendant VPA points to several cases holding a plaintiff cannot seek recovery based on the non-payment of benefits from a claims administrator. Defendant WA correctly cites this principle. However, here plaintiff is not seeking recovery based on the non-payment of benefits from defendant WA. Plaintiff claims defendant WA did not follow proper procedures regarding Plaintiff's claim. If benefits are not awarded by the court, plaintiff seeks an order requiring WA to follow proper procedures in determining her claim. Accordingly, the principle cited by defendant VPA does not mandate its dismissal from the case.
IT IS THEREFORE ORDERED this 31st day of March, 2004 that the court defendant VPA Inc.'s (VPA) motion to dismiss Plaintiff's complaint (Dkt. No. 6).