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Court Affirms Summary Judgment Gordon & Rees Partner Jordan Altura Won for Insurer

The U.S. District Court for the Northern District of California recently affirmed the summary judgment won by Gordon & Rees San Francisco partner Jordan S. Altura and of counsel Dawn N. Valentine for their client, a life insurance company.

The plaintiff sought long-term disability benefits under an ERISA group plan issued to the plaintiff's former employer and underwritten by the insurer. The former employer terminated the plaintiff in February 2007. She sued the employer alleging wrongful termination, among other claims. In settling that lawsuit, the plaintiff signed an integrated settlement agreement in May 2010 in which she agreed to release the employer’s agents, insurers and benefit plans from any claims arising under ERISA.

In December 2010, the insurer received a claim for long-term disability benefits under the plan. The insurer declined the claim as untimely and because the plaintiff did not establish she was disabled. The plaintiff appealed the insurer's benefit determination and on July 18, 2012, the insurer affirmed its denial and advised the plaintiff she was free to file suit under ERISA, section 502(a).

The plaintiff sued the insurer, which responded with a summary judgment motion based on two of its affirmative defenses: (1) the plaintiff waived her right to bring suit against the insurer for ERISA benefits when she signed the settlement agreement with the former employer; and (2) the plaintiff's suit was barred as untimely under the long-term disability plan's contractual limitations period. The court granted the insurer's motion on both bases.

The Northern District held that the plaintiff effectively waived her right to long-term disability benefits under an ERISA plan by entering a settlement agreement with her former employer that released the employer, its agents, employee benefit plans, and insurers from all ERISA claims. It was without consequence that the insurer had not relied on the settlement agreement in denying her claim during the administrative process. The Northern District also held that the plan's contractual limitations period applied to preclude the plaintiff's claim as untimely.

On March 3, the Northern District denied the plaintiff’s motion for reconsideration and affirmed summary judgment in favor of Altura and Valentine’s client. Among other things, the court concluded the insurer did not waive its affirmative defenses by informing the plaintiff she had a right to bring an action under section 502(a) of ERISA and there was no question of fact as to whether the settlement agreement applied to the life insurance company, the plan's insurer.

Jordan S. Altura