James E. Stiltner v. Beretta U.S.A. Corporation

74 F.3d 1473, 19 Employee Benefits Cas. (BNA) 2568, 1996 U.S. App. LEXIS 1562, 1996 WL 42225
CourtCourt of Appeals for the Fourth Circuit
DecidedFebruary 2, 1996
Docket94-1323
StatusPublished
Cited by88 cases

This text of 74 F.3d 1473 (James E. Stiltner v. Beretta U.S.A. Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
James E. Stiltner v. Beretta U.S.A. Corporation, 74 F.3d 1473, 19 Employee Benefits Cas. (BNA) 2568, 1996 U.S. App. LEXIS 1562, 1996 WL 42225 (4th Cir. 1996).

Opinions

[1476]*1476Affirmed by published opinion. Judge HAMILTON wrote the majority opinion, in which Judges RUSSELL, WIDENER, WILKINSON, WILKINS, NIEMEYER and WILLIAMS joined. Judge LUTTIG wrote a separate opinion concurring in the judgment. Senior Judge PHILLIPS wrote an opinion concurring in part and dissenting in part in which Chief Judge ERVIN and Judges HALL, MURNAGHAN and MICHAEL joined. Judge MOTZ did not participate in this case.

OPINION

HAMILTON, Circuit Judge:

Appellant, James E. Stiltner (Stiltner), appeals an order granting summary judgment in favor of his former employer, Beretta U.S.A. Corp. (Beretta), on Stiltner’s ERISA and state law claims against Beretta. A divided panel of this court affirmed the summary judgment as to Counts I, II, and IV of Stiltner’s complaint, but vacated and remanded as to Count III of the complaint. See Stiltner v. Beretta U.S.A. Corp., No. 94-1323, 1995 WL 25643 (4th Cir. January 18, 1995) (designated for publication, but not reported). On Beretta’s suggestion, we vacated the panel decision and reheard the case en banc. Having considered the briefs and the arguments of the parties, we now affirm in toto the district court’s grant of summary judgment.

I.

On November 21, 1988, Stiltner began working as a tool room supervisor for Beretta, a Maryland arms manufacturer. Frank Valoróse, a Beretta employee, helped Stiltner obtain the job. Valoróse had been Stiltner’s manager at Stiltner’s former job with FN Manufacturing (FN).

Stiltner’s initial employment status was that of an independent contractor. Although he was not entitled to the fringe benefits that regular employees received, Stiltner received free housing from Beretta, as well as an allowance to pay for his COBRA coverage under FN’s health insurance plan.1

On February 28, 1989, Beretta offered Stiltner a job as a regular employee. The terms of the offer were described in a letter given to Stiltner by Peter Axelrod, Beretta’s human resources manager. Stiltner and Ax-elrod reviewed the letter together, and Stilt-ner signed the letter to indicate that he found the terms of the offer acceptable. Among the benefits described in the letter were the following:

Medical Insurance: Company paid hospitalization and medical insurance for you and your dependents....
Long Term Disability: Pays 60% of salary after six months of disability (after one year of employment). Payable to age 70.

(J.A. 83). Axelrod agreed to make Stiltner’s regular employment date retroactive to November 21, 1988, for purposes of his eligibility for vacation and benefits.

Stiltner enrolled in two welfare benefit plans that Beretta provided for its employees. The first of these plans, Beretta U.S.A. Health Plan # 501 (the Health Plan) provided group health insurance for all full-time employees and their eligible dependents. The Health Plan provided that coverage would cease at the end of the month in which an employee stopped active work on a full-time basis.

The second plan, Beretta U.S.A. Life and Disability Plan #502 (the Disability Plan), provided long-term disability benefits to full-time employees who became disabled after one year of employment. At the time Stilt-ner enrolled, American Bankers Life Assurance Company (American Bankers) provided the coverage under this plan. American Bankers issued a disability plan insurance policy that expressly excluded coverage for disabilities caused by pre-existing conditions. Although the certificate of insuranee/benefits booklet that American Bankers issued to participants in the disability plan clearly disclosed this pre-existing condition limitation, the summary plan description then in effect [1477]*1477for the disability plan (the original SPD) did not. Stiltner claims that he did not receive a copy of the certificate of insurance/benefits booklet until after he became disabled.

In February 1990, Beretta changed the insurer of its disability plan to the Guardian Life Assurance Company of America (Guardian). The Guardian policy, like the American Bankers policy, had an express pre-existing condition limitation. The new certificate of insurance/benefits booklet issued by Guardian clearly disclosed the pre-existing condition limitation. Beretta sent copies of the new booklet to participating employees, along with a memo entitled “Summary Plan Description Supplement to Certificate for the Beretta U.S.A. Health and Welfare Plans” (the SPD Supplement). The SPD Supplement stated that “[t]his supplement and your certificates of insurance/benefits booklets constitute the Summary Plan Description as required by [ERISA].” (J.A. 566). Stiltner claims that he did not receive a copy of either the new certificate of insurance/benefits booklet or the SPD Supplement until after he became disabled.

Stiltner suffered from a heart condition when he began working for Beretta. On February 6, 1990, he had a heart attack. After the heart attack, he worked sporadically until June 9,1990. Since that date, he has not worked for Beretta or anyone else because of his heart problems.

To assist Stiltner in filing a disability insurance claim, Beretta sent Stiltner the new Guardian certificate of insurance/benefits booklet, the original SPD for the Disability Plan, and the SPD Supplement for that plan. Stiltner applied to Guardian for long-term disability benefits under the Disability Plan, and to the Social Security Administration for Social Security disability benefits. Guardian denied Stiltner’s claim because his disability arose out of a pre-existing condition.

Beretta attempted to help Stiltner in several ways. First, Beretta wrote Guardian, urging it to reconsider its decision to deny Stiltner’s claim for disability benefits. Second, although it was clear that Stiltner would never be able to return to work after June 9, 1990, Beretta kept paying Stiltner his full salary until October 1990, when Stiltner began receiving Social Security disability benefits. Third, despite a provision in the Health Plan stating that coverage would end when he ceased active work on a full-time basis, Beretta kept paying Stiltner’s health insurance premiums while Guardian was considering his claim for disability benefits.

In June 1992, Guardian informed Stiltner that its decision to deny his claim for long-term disability benefits was final. Subsequently, Stiltner demanded that Beretta pay him more than $330,000 in long-term disability benefits. He claimed that he was entitled to the benefits under the terms of his employment contract and the Disability Plan, regardless of the exclusions in the insurance policies. Beretta, which was still gratuitously paying Stiltner’s health insurance premiums, refused Stiltner’s demand. Stiltner then informed Beretta that he intended to assert an ERISA claim for long-term disability benefits and offered to settle that claim for approximately $332,000. Although Beretta did not believe it was legally obligated to pay Stiltner the disability benefits, it offered to pay him $3,000 and to continue paying his health insurance premiums for an additional 18 months, if he would agree to release it from all liability arising from his claim for disability benefits. Beretta added that if Stiltner refused to accept this settlement, it would cease paying any further health insurance premiums on Stiltner’s behalf.2

Stiltner filed this action against Beretta, raising four claims.

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Bluebook (online)
74 F.3d 1473, 19 Employee Benefits Cas. (BNA) 2568, 1996 U.S. App. LEXIS 1562, 1996 WL 42225, Counsel Stack Legal Research, https://law.counselstack.com/opinion/james-e-stiltner-v-beretta-usa-corporation-ca4-1996.