[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
________________________ MAR 13 2001
THOMAS K. KAHN
No. 99-11766 CLERK
________________________
D. C. Docket No. 98-00041-CV-3
DOROTHY HAMILTON,
Plaintiff-Appellant,
versus
ALLEN-BRADLEY COMPANY, INCORPORATED,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Southern District of Georgia
_________________________
(March 13, 2001)
Before ANDERSON, Chief Judge, BLACK and HALL*, Circuit Judges.
HALL, Circuit Judge:
*
Honorable Cynthia Holcomb Hall, U.S. Circuit Judge for the Ninth Circuit, sitting by
designation.
The Court hereby vacates its prior opinion, filed July 10, 2000, and
substitutes this opinion in lieu thereof.
Dorothy Hamilton (“Hamilton”) appeals the grant of summary judgment
entered in favor of Allen-Bradley Company, Inc. (“Allen”). Hamilton had sued
Allen for breach of fiduciary duty under the Employee Retirement Income Security
Act (“ERISA”). We have jurisdiction pursuant to 28 U.S.C. §1291.
I
Hamilton was employed by Allen as a “repair service operator,” a job that
required her to repeatedly manipulate heavy objects. Sometime in 1993 she
developed carpal tunnel syndrome, and by October 1994, she was completely
unable to perform her job as a result of her carpal tunnel syndrome and diabetes.
She had surgery for her carpal tunnel syndrome, but with poor results. In February
1995, she returned to work briefly, but had to quit after a couple of days, and never
returned to work after that. Hamilton applied and was granted social security
disability benefits.
After Hamilton realized that she could no longer work, she inquired of
Melba Lee (“Lee”), Allen’s human resources director, about whether she could
qualify for long-term disability. Hamilton asserts that on this occasion and on
several more occasions from 1994 until 1996, Lee stated that Hamilton did not
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qualify. According to Hamilton, Lee also refused to give Hamilton a claim form,
and did not inform Hamilton of the identity of the insurer for the disability plan.
At Allen, employees are required to go through the human resources department
when they seek to apply for disability benefits. Lee does not remember ever
having turned Hamilton away, but admits that she fields about 50 calls every week
and therefore, Hamilton may have asked her for an application without her
remembering the event. Allen claims that pursuant to company policy, on March
12, 1995, a letter was mailed to Hamilton containing the disability application. Lee
stated in her deposition that she did not know if that letter was ever sent and
Hamilton states that she never received it.
In 1996, after another request by Hamilton for a disability application, Lee
forwarded to her a health insurance claim instead. Hamilton contacted the health
insurer, CIGNA, which told her that all requests for benefits had to go through Lee.
(CIGNA was not the insurer for the disability plan). Therefore Hamilton contacted
Lee again, who allegedly did not respond to Hamilton’s further solicitations.
In 1997, Hamilton encountered several former Allen employees who were
all receiving disability benefits under Allen’s disability plan. At this point,
Hamilton contacted Lee again and this time received the correct application form
for her disability insurer, UNUM insurance. Hamilton returned the form to Lee
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who sent it onto UNUM which denied Hamilton’s claim on the basis that Hamilton
had not properly complied with the notice and proof-of-claim requirements of the
policy, i.e.- Hamilton’s claim was untimely.
In December 1997, Hamilton appealed the denial of her claim to UNUM.
Her basis for the appeal was that Hamilton was required to go through Lee before
she could file a claim, had done so in a timely fashion, but was prevented from
sending UNUM her application by Lee. In fact, Hamilton asserted that Allen knew
in September 1994, that Hamilton was having medical problems, and actually
separated Hamilton from work in October 1995, for “being unable to return to
work.” UNUM rejected her appeal, and Hamilton filed suit against UNUM and
Allen in Georgia state court. UNUM and Allen removed to federal court and
moved for summary judgment which the district court granted. Hamilton only
appeals the ruling as it pertains to Allen and argues that she should prevail because:
(1) Allen is culpable for wrongfully denying Hamilton her benefits; and (2) Allen
breached its fiduciary duty by failing to provide her with the necessary information
needed to file her disability claim.
II
We review de novo an order granting summary judgment, applying the same
legal standards as the district court. See Wolf v. Coca-Cola Co., 200 F.3d 1337,
4
1339 (11th Cir. 2000). As such, the record has to be viewed in the light most
favorable to the non-moving party. See Holbrook v. City of Alpharetta, 112 F.3d
1522, 1525-26 (11th Cir. 1997).
A. WRONGFUL DENIAL
1. Waiver
The Federal Rules of Civil Procedure provide that a complaint contain
a short and plain statement of the claim showing that the pleader is entitled to
relief, and a respective demand for that relief. See FRCP 8(a). “A complaint need
not specify in detail the precise theory giving rise to recovery. All that is required
is that the defendant be on notice as to the claim being asserted against him and the
grounds on which it rests.” Sams v. United Food & Commercial Workers
International Union, AFL-CIO, CLC, 866 F.2d 1380, 1384 (11th Cir. 1989); Evans
v. McClain of Georgia, Inc., 131 F.3d 957, 964 n.2 (11th Cir. 1997) (quoting Sams,
866 F.2d at 1384); Plumbers & Steamfitters Local 150 v. Vertex Constr., 932 F.2d
1443, 1448 (11th Cir. 1991) (same).
Allen’s primary contention in the context of Hamilton’s wrongful denial
claim is that she has failed to raise it until now and therefore it should be deemed
waived. The complaint which Hamilton filed in state court states that the
defendant “Allen-Bradley Company” is Hamilton’s former employer and the
5
sponsor and administrator of the group long-term disability plan. See Complaint at
2, ¶¶ 4 & 5. Hamilton’s complaint further avers that this plan states that: “When
the Company receives proof than an insured is disabled due to sickness or injury
and requires the regular attendance of a physician, the Company will pay the
insured a monthly benefit after the end of the elimination period.” See Complaint
at 3, ¶ 7. Hamilton’s complaint seeks a reinstatement of her disability benefits
based on a wrongful denial, and names both UNUM and Allen as defendants. See
Complaint at 5-6. Allen is also alleged as not having appropriately provided
Hamilton with the requested benefits application forms and thus not having
appropriately forwarded Hamilton’s request for benefits to UNUM. See Complaint
at 3, ¶ 9. Even though the complaint is not a model of clarity, the above allegations,
along with the fact that Allen was named as a defendant and the only relief sought
was reinstatement of disability benefits based on a wrongful denial, should have
put Allen on notice that this claim was being leveled against it by Hamilton. We
conclude that Hamilton’s complaint was sufficient to state a cause of action against
Allen for wrongful denial of benefits and that Hamilton did not waive that claim.
Therefore, we will review Hamilton’s appeal for wrongful denial of benefits on the
merits.
2. Merits
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ERISA provides that a “civil action may be brought by a participant or
beneficiary . . . to recover benefits due . . . under the terms of [the] plan.” See 29
U.S.C. §1132(a)(1)(B). In the Eleventh Circuit, this section confers a right to sue
the plan administrator for recovery of benefits. See Rosen v. TRW, Inc., 979 F.2d
191, 193-94 (11th Cir. 1992). Therefore, if the employer is administering the plan,
then it can be held liable for ERISA violations. See id. at 193-94. Proof of who is
the plan administrator may come from the plan document, but can also come from
the factual circumstances surrounding the administration of the plan, even if these
factual circumstances contradict the designation in the plan document. See id. at
193.
The key question on this issue is whether Allen had sufficient decisional
control over the claim process that would qualify it as a plan administrator under
Rosen. This requires an analysis of the facts surrounding the administration of the
disability plan. The first fact is that the plan booklet states that any claim must be
made to UNUM. This would seem to cut in Allen’s favor.
However, Hamilton offers testimony by Lee to the effect that Allen requires
its employees to go through its human resources department in order to obtain an
application for disability benefits. This fact places Allen in sufficient control over
the process to qualify as the plan administrator notwithstanding the language of the
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plan booklet. See Law v. Ernst & Young, 956 F.2d 364, 373-74 (1st Cir. 1992).
Moreover, Allen’s benefit choice booklet states: “Plan Administrator - Manager,
Employee Benefit Programs, Allen Bradley Company, . . . . The Plan
Administrator has designed the identified insurance companies and the Allen
Bradley Company as its agents to administer the Plan, to process all claims and
appeals, and to provide other administrative services.” (Emphasis added).
Hamilton points out that Allen did carry out its administrative designation by
handing out the claim forms itself without getting prior permission from UNUM,
and by fielding questions about the plan from employees. Hamilton also includes
an excerpt of Lee’s deposition that identifies Milwaukee (Allen’s headquarters) as
the headquarters of the plan administration. Under the factual inquiry outlined in
Rosen, there are sufficient indicators that point to Allen as a plan administrator.
Allen’s arguments against the above conclusion are misplaced. First, Allen
points to law in other circuits which does not allow for the employer to be
designated as a co-plan administrator for the purposes of liability. See e.g. Crocco
v. Xerox Corp., 137 F.3d 105, 107 (2d Cir. 1998); Madden v. ITT Long Term
Disability Plan for Salaried Employees, 914 F.2d 1279, 1287 (9th Cir. 1990).
Because there is law going in the opposite direction in this circuit, we are bound to
follow the law of our circuit and Allen’s argument is without merit.
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The second argument that Allen raises is that because Hamilton’s claim was
untimely, she has no cause of action for wrongful denial. The essence of this
second argument is correct, but the result applies only to UNUM, and not to Allen,
because there is a material dispute of fact as to whether Hamilton informed Allen
during the time in which her claim request would have been timely. Allen goes on
to distract this Court by citing extensive law for the proposition that UNUM’s
notice requirement cannot be imputed to Allen for purposes of UNUM’s liability.
See UNUM Life Insurance Co. of America v. Ward, 526 U.S. 358, 379 (1999).
Again Allen is correct on the legal statement, but again, Allen is incorrect as to its
application because Ward concerned a claim against the insurer and not the
employer. Therefore, because the district court did not proceed with any further
analysis on this issue, but dismissed Hamilton’s case for lack of a remediable
claim, we remand the case for a determination of the other elements of a wrongful
denial claim.
B. FIDUCIARY DUTY
1. Waiver
Like the previous issue, Allen offers a waiver argument to parry
Hamilton’s claim against it. Allen’s argument is two-fold: (1) that because the
complaint did not include any breach of fiduciary claims, then Hamilton should be
9
barred from bringing them before this Court because it would be the first time that
any court would review them; and (2) that Hamilton’s claim that Allen should be
liable because it failed to disclose truthful information about the plan should be
barred because it was never raised before.
We reject both of Allen’s waiver arguments. Even though it is true that the
original complaint did not contain the specific words “breach of fiduciary duty” or
“truthful” information, Hamilton’s complaint outlined sufficient facts to put Allen
on notice of such a claim. For example, Hamilton’s complaint states that it is filed
pursuant to ERISA and that Allen is the plan administrator and sponsor. See
Complaint at 2, ¶¶ 4 & 5. Hamilton’s complaint charges Allen with failing to
provide Hamilton with a copy of the disability benefits application or disability
plan booklet. See Complaint at 5, ¶ 16. Hamilton’s complaint further alleges that
she specifically asked Allen for the benefits application forms several times and
was denied access to the forms by Allen. See Complaint at 3, ¶ 9. Hamilton’s
complaint also asserts that she explained to defendant UNUM that she had notified
defendant Allen of her disability, asked for the disability application form, and
been denied access. It is clear from the complaint that in essence Hamilton was
contending that Allen had failed to give her the appropriate information and that it
was defendant Allen’s fault that she had not timely filed her disability claim with
10
defendant UNUM. These facts are consistent with a claim for breach of fiduciary
duty against Allen and failure to disclose truthful information as a basis for that
claim. Therefore, the issue is properly before this Court and we will entertain her
claim on the merits.
2. Merits
ERISA provides that “a fiduciary shall discharge his duties with
respect to a plan solely in the interest of the participants and beneficiaries . . . for
the exclusive purpose of . . . providing benefits to participants and their
beneficiaries . . . with the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an enterprise of a like
character and with like aims.” See 29 U.S.C. §1104(a)(i)(A) & (B). ERISA also
provides remedies for breaches of fiduciary duties by stating that any fiduciary
who breaches its responsibilities shall be personally liable to return any losses
incurred as a result of the breach to the plan. See 29 U.S.C. §1109(a). Allen
claims, and the district court agreed, that §1109(a) provides an exclusive remedy
under ERISA and that no private right of action is allowed. Both Allen and the
district court relied on Simmons v. Southern Bell Tel. & Tel. Co., 940 F.2d 614,
617 (11th Cir. 1991) which held that such a private right of action does not exist.
11
The main problem in relying on Simmons is that this case had been reversed
by the Supreme Court over three years before the district court entered its ruling in
this case. See Varity Corp. v. Howe, 516 U.S. 489, 506-515 (1996). In Varity, the
Supreme Court tackled the exact same issue presented here, whether §1109
functions as an exclusive remedy for breaches of fiduciary duties or whether
remedies outside the statute can exist. The Supreme Court adopted the latter
approach by stating that there was nothing in the statute, or in the legislative
history, which indicated that §1109 functioned as a limitation of rights, given the
statute’s overall purpose in benefitting injured beneficiaries. See Varity, 516 U.S.
at 511-512. Therefore, the Supreme Court concluded that any losses, the remedy
of which was not contemplated within ERISA, provide a private right of action
through the catch-all phrase of 29 U.S.C. §1132(a)(3). See id. at 512.
Allen makes a great deal about the fact that the Varity argument was not
raised before the district court, and therefore is to be deemed waived. Allen’s
argument is problematic at best, because as an officer of the court, it was both
Hamilton’s and Allen’s duty to point out to the district court that Simmons had
been abrogated. It seems presumptuous for Allen to now bring this particular
waiver argument before this Court after failing to properly carry out its duties
before the district court.
12
Allen’s other argument is that Varity does not apply in this case because
Hamilton has not asserted a cause of action under the catch-all provision of
ERISA, but rather under a provision where the statute has already contemplated a
remedy. See 29 U.S.C. §1132(a)(1)(B). The Supreme Court, in Varity, has
already implicitly rejected this argument by saying that it is ERISA itself that acts
as the safety net; if a violation has no appropriate remedy provided by ERISA, then
the catch-all provision acts as a safety net by offering appropriate equitable relief.
See Varity, 516 U.S. at 512. It is irrelevant under what heading Hamilton pled,
because if the remedy she seeks is outside ERISA, as it is in this instance (because
a private cause of action is not contemplated within the four corners of the statute),
then the catch-all provision automatically applies. Thus, Hamilton has standing to
bring a cause of action against Allen.
The final two issues which remain to be determined are whether Allen is a
fiduciary, and, if so, whether material issues of fact exist as to whether any
fiduciary duty was breached by it. The first issue does not seem to be contested by
Allen. In fact, the facts necessary to determine whether Allen is a fiduciary under
the plan are identical to those which go to determine whether Allen is a plan
administrator. ERISA defines a fiduciary with respect to the plan as someone who
has any discretionary authority over the administration of the plan. See 29 U.S.C.
13
§1002(21)(A). Therefore, because, as analyzed in part II.A.2. above, the facts
show that Allen was a plan administrator seeing that it maintained discretionary
authority under the plan, then it necessarily follows that Allen is also a fiduciary
under ERISA.
There is disputed evidence as to whether Allen provided Hamilton with the
necessary forms and information for her to bring her claim on time. If the failure
to convey such data is a breach of a fiduciary duty, then this issue is ripe for jury
determination. Precedent indicates that Allen did have a fiduciary duty that
obligated it, at the very least, to forward Hamilton’s requested claim to UNUM.
Particularly instructive is Krohn v. Huron Memorial Hospital, 173 F.3d 542 (6th
Cir. 1999). In Krohn, the employer failed to submit a disability application, which
was brought to it by a covered employee, to the insurer upon the belief that the
employee was not interested in applying for benefits. See id. at 546. The Krohn
court held that the employer was not entitled to second-guess the employee’s
intentions and had to forward the request to the insurer, and a failure to do so
constituted a breach of a fiduciary duty. See id. at 551-52. Equally instructive is
ERISA itself which states that a plan administrator is performing a fiduciary act
when making a discretionary determination about whether a claimant is entitled to
benefits. See 29 U.S.C. §1104(a)(1)(D).
14
Allen tries to distinguish the facts of Krohn by pointing out that eventually,
once Hamilton gave it a completed claim application, it forwarded it to UNUM.
This ignores Hamilton’s contention that Allen should have forwarded the request
when Hamilton initially went to Lee within the period which would have saved her
claim from being untimely.
In this case, like in Krohn, the employer made a decision regarding whether
or not to convey information to the insurance company. Such a failure resulted in
the loss of benefits for the employee. In Krohn it was the failure to mail the
completed claim form; here, it is the refusal to contact the insurance company on
the grounds that Lee believed that Hamilton had no claim. Therefore Allen
performed a fiduciary act and is liable if such an act is deemed wrongful.
Allen is also incorrect in its argument that failure to disclose information to
Hamilton does not rise to the level of a fiduciary duty. Precedent states that a
“fiduciary must give complete and accurate information in response to participants’
questions.” Drennan v. General Motors Corp., 977 F.2d 246, 251 (6th Cir. 1992).
Even though Allen is correct in noting that the Supreme Court explicitly declined
to decide this issue, see Varity, 516 U.S. at 506, Allen cannot point to any case
stating the opposite conclusion of the Drennan (and Krohn) decisions. As such,
15
Allen’s failure to disclose information to Hamilton, if true, is also a breach of a
fiduciary duty.
Allen is, however, correct in its assertion that Hamilton’s claim that Allen
should have provided claim forms to her does not reach the level of a fiduciary
duty. ERISA specifies that the plan administrator must furnish, on written request,
any information regarding the operation of the plan. See 29 U.S.C. §1024(b)(4). It
is undisputed that Hamilton never presented a written request for the claim forms,
nor is it disputed that precedent has established that claim forms do not fall within
the category of documents covered by §1024. See Allinder v. Inter-City Products
Corp. (USA), 152 F.3d 544, 548-50 (6th Cir. 1998). Therefore, Allen did not have
a fiduciary duty to provide Hamilton with claim forms without prior proper
solicitation by Hamilton.
In sum, the district court erred in dismissing Hamilton’s wrongful
termination claim because Eleventh Circuit law states that such claims are properly
asserted against the employer who acts as a plan administrator. The district court
also erred in granting summary judgment for Allen on Hamilton’s breach of
fiduciary duty claims because it relied on a reversed case, and because most of the
acts that Hamilton has alleged Allen committed fall under the rubric of fiduciary
acts.
16
III
For the foregoing reasons, we REVERSE the district court’s decision on
both issues and REMAND for further proceedings consistent with this opinion.1
1
Arguably, there has been no discovery on the breach of fiduciary duty claim. While the
relevant discovery on this claim is likely to overlap with that of the claim for wrongful denial of
benefits, the district court on remand always has the ability to reopen discovery on the motion of
either party.
17