ERISA And The Claims File

In an ERISA case, the plan administrator, upon request, is required to give a copy of the claims file to the insured.  The most common way this occurs is when a claim is denied, the plan administrator informs the insured of the denial in a written letter and in the letter the insured is informed of their right to an appeal and a copy of the claims file.  The insured should then request a copy of that file.

In a recent case out of the Southern District of Texas, Houston Division, the insured claimed they did not timely receive a copy of the claims file and thus, argued that the statute of limitations on their claim was tolled until such time that she received the claims file.  This case is styled, Cynthia Sternberg v. Metlife Insurance Company.

In this case, the insured has clearly let the statute of limitations pass for her appeal.  These limitations were made clear in the policy.  So, the insured made arguments regarding the tolling of the limitations period.

Sternberg invoked the equitable principles of fraudulent concealment and equitable estoppel to argue that the Plan’s limitations period should be tolled because MetLife refused to provide her with a copy of her claim file.  The doctrine of fraudulent concealment tolls a statute of limitations when a defendant knowingly conceals facts from a plaintiff that are necessary to support a claim.  To establish an equitable estoppel claim in an ERISA action Sternberg must demonstrate: (1) a material misrepresentation; (2) reasonable and detrimental reliance upon the representation; and (3) extraordinary circumstances.  These requirements were made clear in the 2009, 5th Circuit opinion styled, Piecznski v. Dril-Quip, Inc. Long Term Disability Plan.  ERISA has procedures to ensure that information about an ERISA plan is accessible to its participants.  For example, ERISA, according to 29 U.S.C., Section 1024(b)(4) requires plan administrators to “upon written request of any participant or beneficiary, furnish a copy of the latest updated summary, plan description, and the latest annual report, any terminal report, the bargaining agreement, trust agreement, contract, or other instruments under which the plan is established or operated.”  Plan administrators who fail to timely provide participants with requested plan information are subject to statutory penalties found in Section 1132(c)(1).  Sternberg argues that MetLife “unscrupulously concealed the Plan documents and the altered and reduced statute of limitations” in the Plan.  As the Plan’s administrator, Baker Hughes was required to provide information on the Plan to Sternberg upon a written request by Plaintiff.  Sternberg cites no authority requiring MetLife to provide her with information about the Plan.  Nor is there any evidence that MetLife attempted to conceal the limitations period from her.  The evidence presented by MetLife shows the opposite: MetLife sent Sternberg a letter upholding denial of her claim and reminding her that “the Plan may limit the period of time she may have in which to file a civil action.”   There is also no evidence that MetLife “altered and reduced” the Plan’s limitations period.  Sternberg has not shown that MetLife fraudulently concealed the Plan (or its three-year limitations period on civil actions).  There is also no indication that MetLife made a material misrepresentation to Sternberg regarding the terms of the Plan entitling her to equitable estoppel.  No equitable remedy is available to Sternberg to toll the Plan’s limitations period.  Sternberg’s ERISA breach of contract claim against MetLife is therefore time-barred by the Plan’s limitations period.

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