Central States, Southeast & Southwest Area Health, & Welfare Fund v. Gerber Life Insurance

984 F. Supp. 2d 246, 57 Employee Benefits Cas. (BNA) 1700, 2013 WL 6196964, 2013 U.S. Dist. LEXIS 169082
CourtDistrict Court, S.D. New York
DecidedNovember 26, 2013
DocketNo. 13-cv-2994 (NSR)
StatusPublished
Cited by6 cases

This text of 984 F. Supp. 2d 246 (Central States, Southeast & Southwest Area Health, & Welfare Fund v. Gerber Life Insurance) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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Central States, Southeast & Southwest Area Health, & Welfare Fund v. Gerber Life Insurance, 984 F. Supp. 2d 246, 57 Employee Benefits Cas. (BNA) 1700, 2013 WL 6196964, 2013 U.S. Dist. LEXIS 169082 (S.D.N.Y. 2013).

Opinion

OPINION AND ORDER

NELSON S. ROMÁN, District Judge.

This lawsuit arises from insurance claims made on behalf of seven covered individuals in connection with high school athletic injuries that they sustained while they were covered by both Central States, Southeast and Southwest Areas Health and Welfare Fund (collectively “Central States” or the “Fund”) and Gerber Life Insurance Company (“Gerber”). Complaint, ¶¶ 8-11, and at Ex. B.

Defendants move to dismiss Plaintiffs’ Complaint pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim upon which relief may be granted. For the reasons set forth below, Defendants’ motion to dismiss is GRANTED.

Background

For purposes of this motion, this Court accepts as true the facts as stated in Plaintiffs’ Complaint. Central States is an employee welfare benefit plan regulated under the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended 29 U.S.C. § 1001 et seq. that provides health benefits, including medical and hospital benefits, to participants in the Teamster Industry and their dependents. Complaint ¶ 4. Gerber is a private insurance company that has sold student accident medical insurance to the same seven covered individuals through various high schools and colleges. Complaint ¶6. Administrative Concepts, Inc. is -a third party administrator that processed all of the claims at issue for Gerber. Complaint ¶ 7.

At the time of their injuries, the covered individuals were covered as dependents (immediate family members) of the Central States’ participants. Complaint ¶4 and Exhibit B. The covered individuals were also covered directly by Gerber through their participation in the organizations to which Gerber sold insurance. [248]*248Complaint ¶ 6. The injuries that gave rise to the claims at issue occurred while the covered individuals were participating in high school athletic activities covered by Gerber’s student accident policies. Complaint ¶¶ 29-35 and Exhibit B. In total, the claims brought by the covered individuals and paid by Central States equal $101,686.07. Complaint ¶ 50.

When Central States receives claims for individuals who have overlapping insurance coverage, Central States’ Plan establishes rules for determining coordination of benefit (“COB”) rights. Complaint ¶21. Central States’ Plan COB provisions provide, in pertinent part, that overlapping insurance carriers are considered the primary insurers if they have no coordination of benefits provision in their plans, or if they provide specific risk coverage, including but not limited to, premises liability or medical benefits coverage. Id. Additionally, Central States’ COB provisions state that when another plan provides benefits to a person directly, as opposed to as a dependent, the other insurer has primary responsibility. Id.

Central States’ Plan also sets forth Central States’ right to reimbursement for any payments in excess of benefits payable under the terms of the Plan, from any responsible persons or entities. Complaint ¶ 20. The Plan authorizes Central States’ Trustees to file suit on behalf of Central States against other plans to recover any such payments. Complaint ¶ 24. In addition, the Plan authorizes Central States’ Trustees to seek a judicial declaration regarding the responsibility of other plans that are primarily responsible for the payment of benefits. Complaint ¶ 24.

Under Central States’ COB rules, Central States maintains that the Defendants are primarily responsible for paying the covered individuals’ medical expenses. Complaint ¶ 21. In an effort to avoid hardship to the covered individuals, Central States paid their medical expenses and sought reimbursement from the defendants. Complaint ¶¶ 29-35. However, defendants denied Central States’ demands for reimbursement and claimed that the insurance policies that they issued were accidental injury excess policies that were meant to only provide excess coverage or coverage that is secondary to that provided by Central States. Complaint, Exhibit B. Plaintiffs then filed this lawsuit to enforce the terms of Central States’ plan pursuant to Section 502(a)(3) of ERISA.

Defendants have moved to dismiss on the theory that Plaintiffs have failed to state a cause of action. Specifically, Defendants assert that Plaintiffs’ claims are for monetary relief, which is not available under Section 502(a)(3) of ERISA.

Discussion

A. Legal Standard

a. Motion to Dismiss Under Rule 12(b)(6)

On a motion to dismiss for “failure to state a claim upon which relief can be granted,” Fed.R.Civ.P. 12(b)(6), this Court accepts all factual allegations in the complaint as true and draws all reasonable inferences in the plaintiffs favor. Ruotolo v. City of N.Y., 514 F.3d 184, 188 (2d Cir.2008). Dismissal is proper unless the complaint “contain[s] sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)); accord Hayden v. Paterson, 594 F.3d 150, 160 (2d Cir.2010). “Although for the purposes of a motion to dismiss [a court] must take all of the factual allegations in the complaint as true, [it is] ‘not bound to accept as true a legal conclusion [249]*249couched as a factual allegation.’ ” Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955).

When there are well-pleaded factual allegations in the complaint, “a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” Id. A claim is facially plausible when the factual content pleaded allows a court “to draw a reasonable inference that the defendant is liable for the misconduct alleged.” Id. The factual allegations of a complaint need not be detailed, but they must be sufficient to “nud[ge] ... claims across the line from conceivable to plausible,” Twombly, 550 U.S. at 570, 127 S.Ct. 1955 — in other words, to raise a potential entitlement to relief beyond the “speculative level.” Id. at 555, 127 S.Ct. 1955. Thus, a pleading that merely offers “labels and conclusions” or a “formulaic recitation of the elements of a cause of action” is insufficient. Id. Ultimately, determining whether a complaint states a facially plausible claim upon which relief may be granted must be “a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id. at 679,129 S.Ct. 1937.

b. Materials Considered on Motion to Dismiss

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984 F. Supp. 2d 246, 57 Employee Benefits Cas. (BNA) 1700, 2013 WL 6196964, 2013 U.S. Dist. LEXIS 169082, Counsel Stack Legal Research, https://law.counselstack.com/opinion/central-states-southeast-southwest-area-health-welfare-fund-v-gerber-nysd-2013.