After her claim for ERISA long-term disability benefits was denied, Castro sued Hartford, seeking benefits and an administrative penalty for the failure to provide certain requested documents, including copies of Hartford’s internal claims guidelines, training manuals, and other procedures.
Hartford sought dismissal of the penalty claim, asserting that the penalties authorized by 29 U.S.C. § 1132(c) did not apply to the requested documents, and that it was not the "plan administrator" and thus was not subject to penalties under the statute.
The federal district court agreed that Castro’s "requests were for materials not referenced in section 1024, and therefore they do not fall within the scope of penalties under section 1132(c) for failing to supply them to plaintiff." Specifically, the court held that the documents did not constitute "other instruments under which the plan is established or operated." The "plain text of section 1024," the court wrote, "refers only to the formal legal documents governing a plan, and does not refer to claims-related documents."
The court also agreed that Hartford was not liable for penalties, because it was not the "plan administrator." In that regard, the plan specifically designed the employer, Publix, as the plan administrator.
Moreover, the court rejected the claim that Hartford was nonetheless liable as the "de facto plan administrator" because it was the decision-maker on disability claims and because it possessed discretionary authority under the plan. "The Eleventh Circuit has only ‘applied the de facto plan administrator doctrine to employers,’" the court noted, quoting Oliver v. Coca Cola Co., 497 F.3d 1181, 1194 (11th Cir. 2007).
Thus, for example, the Eleventh Circuit’s earlier decision in Rosen v. TRW, Inc., 979 F.2d 191 (11th Cir. 1992), often cited in support of the de facto administrator doctrine, actually stood "for the proposition that an employer that establishes a plan and acts as the ‘de facto plan administrator’ may not shield itself from liability as plan administrator by designating a sham entity in the plan document," the court wrote. Here, the court noted, there was "no evidence that Publix and Hartford Life are ‘alter egos’ and therefore Rosen does not apply."
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