of good faith and
fair dealing. In addition, plaintiff seeks punitive damages.
The defendants have all moved to dismiss the claims for breach of
fiduciary duty, the state law claims, and the punitive damages claim
pursuant to FED. R. CIV. P. 12(b)(6). After a careful review, we will
grant the defendants' motion.
We have jurisdiction over the instant case pursuant to
29 U.S.C. § 1132(e)(1) (providing United States District Courts
jurisdiction over ERISA actions) and 29 U.S.C. § 1331 (providing
United States District Courts with jurisdiction over "all civil actions
arising under the Constitution, laws, or treaties of the United
Standard of Review
When a 12(b)(6) motion is filed, the sufficiency of a complaint's
allegations are tested. The issue is whether the facts alleged in the
complaint, if true, support a claim upon which relief can be granted. In
deciding a 12(b)(6) motion, the court must accept as true all factual
allegations in the complaint and give the pleader the benefit of all
reasonable inferences that can fairly be drawn therefrom, and view them
in the light most favorable to the plaintiff. Morse v. Lower Merion
School District, 132 F.3d 902, 906 (3d Cir. 1997). Defendants cite cases
that hold that all of the state law claims that the plaintiff is pursuing
are pre-empted by ERISA.
Defendant's motion to dismiss raises issues that can be broken down
into three categories: 1) state law claims; 2) fiduciary claims; and 3)
punitive damages claim. We shall add research category seriatim.
I. State law claims
ERISA supersedes "any and all State laws insofar as they may now or
hereafter relate to any [ERISA-covered] employee benefit plan. . . ."
29 U.S.C. § 1144(a). The courts have given this preemption a broad
scope. The 1975 Salaried Retirement Plan For Eligible Employees of
Crucible, Inc. v. Nobers, 968 F.2d 401, 406 (3d Cir. 1992). A cause of
action is related to ERISA if the existence of the ERISA plan is a
critical factor in establishing liability. "In short, if there were no
plan, there would be no cause of action." Id. See also Pilot Life Ins.
Co. v. Dedeaux, 481 U.S. 41, 47 (1987) (noting the expansive sweep of the
preemption clause and holding that the phrase "relate to" is given a broad
common-sense meaning, such that a state law "relate[s] to" a benefit plan
in the normal sense of the phrase, if it has a connection with or
reference to such a plan.) We shall examine all of the state law causes
of action raised by the plaintiff to determine if they fall within the
A. Breach of contract
Count IV*fn2 of the plaintiff's complaint alleges that the decision to
deny payment of the long-term disability insurance constitutes a breach
of contract. Compl. ¶ 21. Count IX also asserts a state law breach
of contract action. Compl. ¶ 52. The Court of Appeals for the Third
Circuit has noted that suits against insurance companies for denial of
benefits, even when the claim is couched in terms of common law
negligence or breach of contract,
are preempted by ERISA. Pryzbowski v.
U.S. Healthcare, Inc., 245 F.3d 266, 278 (3d Cir. 2001). The law provides
that ERISA preempts breach of contract claims relating to the denial of
benefits under an ERISA plan. Pane v. RCA Corp., 868 F.2d 631, 635 (3d
Cir. 1989). Accordingly, the defendants' motion to dismiss the breach of
contract claims will be granted.
B. Negligence and negligent misrepresentation
Counts XI and XII of plaintiff's complaint assert claims for negligence
and negligent misrepresentation. See Compl. ¶¶ 57-65. Both of these
claims are preempted by ERISA as they relate to the ERISA plan. Count XI
alleges that the defendants' negligent acts included: permitting
plaintiff to be without long term disability insurance; intentionally
causing plaintiff to be without insurance; representing to plaintiff that
she had proper long-term disability insurance coverage; intentionally and
repeatedly denying payment of long term disability insurance; and failing
to use care in handling plaintiff' s disability claim. Compl. ¶ 64.
These claims clearly "relate" to the ERISA plan and are preempted. Berger
v. Edgewater Steel Co., 911 F.2d 911, 923 (3d Cir.1990), cert. denied,
499 U.S. 920 (1991) (holding that ERISA preempts state common law
"misrepresentation" claim). Accordingly, these two counts will be
C. Unjust enrichment
Count X of plaintiff's complaint asserts a cause of action for unjust
enrichment. It alleges that Defendant UNUM has retained the premiums paid
on behalf of plaintiff and failed to make payments to plaintiff in
accordance with the long term disability policy. Thus, according to the
plaintiff, Defendant UNUM has been unjustly enriched. Compl. ¶ 56.
Once again plaintiff has asserted a state law cause of action related to
an ERIS A employee benefit plan. Accordingly, it is preempted and must be
dismissed. See Pilot Life, supra.
D. Promissory estoppel
Count VIII of the plaintiff's complaint asserts a cause of action for
promissory estoppel. Plaintiff claims that the defendant hospital promised
and represented to plaintiff that it would maintain adequate long-term
disability coverage. Compl. ¶ 40. Defendant has violated this
promise and given rise to a promissory estoppel claim by denying her
long-term disability benefits. Compl. ¶ 42. Again, this claim
relates to an ERISA benefit plan, and it is preempted. See Charter
Fairmount Institute, Inc. v. Alta Health, 835 F. Supp. 233, 239-40
(E.D.Pa. 1993) (holding, inter alia, that the plaintiff's estoppel claim
was preempted by ERIS A).
E. Duty of good faith and fair dealing
Plaintiff also raises the claim of violation of the duty to act in good
faith and fair dealing.*fn3 The Third Circuit Court of Appeals has found
that such a claim is preempted by ERIS A. Pane v. RCA Corp., 868 F.2d 631,
634-35 (3d Cir. 1989). Accordingly, it will be dismissed.
F. Damages and Fees
Plaintiff seeks damages in count XIII of the complaint. Count XIII is
not a separate cause of action, but merely a request for damages. This
count will be dismissed to the extent that it can be read to apply to any
of the counts we are dismissing.
II. Plaintiff's Fiduciary Duty Claims
Counts VI and VII of the plaintiff's complaint allege that defendants
violated fiduciary duties owed to the plaintiff. The defendant asserts
that these causes of action should be dismissed. We agree.
ERISA sets forth who is empowered to bring a civil action. Courts have
interpreted ERISA to mean that a plaintiff cannot sue for breach of
fiduciary duties to obtain denied benefits.
ERISA provides in part as follow s:
Any person who is a fiduciary with respect to a plan
who breaches any of the responsibilities,
obligations, or duties imposed upon fiduciaries by
this subchapter shall be personally liable to make
good to such plan any losses to the plan resulting
from each such breach, and to restore to such plan any
profits of such fiduciary which have been made through
use of assets of the plan by the fiduciary, and shall
be subject to such other equitable or remedial relief
as the court may deem appropriate, including removal
of such fiduciary. . . .
29 U.S.C. § 1109. ERISA states that a participant or beneficiary may
bring suit for relief under section 1109. 29 U.S.C. § 1132(a)(2). The
United States Supreme Court has held that there can be no disagreement
that 29 U.S.C. § 1132(a) authorizes a beneficiary to bring an action
against a fiduciary who has violated 29 U.S.C. § 1109(a).
Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 140 (1985).
Recovery under this section, however, inures to the plan not to an
individual. Id. Plaintiff is seeking relief for herself, not the plan;
therefore, this section does not provide her with the ability to raise a
breach of fiduciary duty cause of action.
Another statutory section which may provide plaintiff with a cause of
action based on fiduciary duties is section 502(a)(3) codified at
29 U.S.C. § 1132(a)(3). This section allows an ERISA participant or
beneficiary to file suit to obtain "other appropriate equitable relief."
This section is also inappropriate for the plaintiff. She is seeking
payment of benefits that she claims are due to her. The United States
Supreme Court has held that a claim for money due and owing is not
equitable relief and does not fall under this section. Great-West Life
& Annuity Ins. v. Knudson, 534 U.S. 204, 122 S.Ct. 708, 712-13 (200
2). Accordingly, plaintiff's breach of fiduciary claim will be dismissed
as the relief she is seeking is not available under that cause of
The basis of plaintiff's complaint, including the portion of the
complaint dealing with fiduciary duty, is that benefits have been wrongly
denied. See Compl. ¶ 34-39. Instead of being a case involving a
breach of fiduciary duty, therefore, plaintiff's case is a
straightforward denial of benefits case. ERISA specifically provides that
a participant or beneficiary of a plan may bring a civil action to
recover benefits that are due. 28 U.S.C. § 1132(a)(1). Denial of
benefits is the essence of plaintiff's claim, not a breach of fiduciary
duties. Therefore, our dismissal of the breach of fiduciary duty counts
will not prevent plaintiff from potentially obtaining all the relief she
III. Punitive Damages
Plaintiff also has a count in which she seeks punitive damages. See
Compl. ct. XIV. It has been consistently held that ERISA does not
authorize the award of punitive damages. Pane v. RCA Corp.,
868 F.2d 631,635, n. 2 (3d Cir. 1989). Accordingly, the claim for
punitive damages will be dismissed.
For the reasons set forth above, the defendants' motion to dismiss will
be granted, and the following counts of the complaint will be dismissed:
Counts IV, IX, XI, XII, X, VIII, XIII, VI, VII, XIV. An appropriate order
AND NOW, to wit, this 5th day of December 2002, the defendants' motion
dismiss (Doc. 8) is hereby GRANTED. Counts IV and VI through XIV of
the complaint are hereby DISMISSED.*fn4