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Sandra A. Mraz v. Aetna Life Insurance Company

October 17, 2012


The opinion of the court was delivered by: (judge Richard P. Conaboy)


We consider here a Motion to Dismiss (Doc. 11) Counts II and III of Plaintiff's Amended Complaint (Doc. 9) that was filed August 1, 2012, by Aetna Life Insurance Company ("ALIC"). *fn1 This Motion has been briefed (Docs. 12 and 14) and is ripe for disposition.

I. Background

Plaintiff's decedent, David J. Mraz ("Mraz"), died on September, 2009 as a result of injuries sustained in an accident while driving an all-terrain vehicle. At the time of his death, Mraz was employed by General Dynamics Corporation ("Employer"). Pursuant to the Employee Retirement Income Security Act, 29 U.S.C. §§ 1002 et seq., ("ERISA"), the Employer provided a Welfare Benefit Plan ("Plan") for the benefit of its employees. That Plan included both basic and supplemental life insurance coverage for eligible employees. Mraz was such an eligible employee.

Mraz applied initially for basic coverage in the amount of his annual basic earnings and later requested supplemental coverage in the amount of twice his annual basic earnings. Pursuant to certain requirements of the Plan, he submitted an Evidence of Insurability Statement ("EOI") to ALIC on November 11, 2008 and received EOI approval the next day, November 12, 2008. Plaintiff contends that, pursuant to the terms contained in the Summary of Coverage ("Summary") of the Group Life and Accident and Health Insurance Policy ("Policy") of the Plan, Mraz's coverage became effective no later than the date - - November 12, 2008 - - ALIC approved the EOI. Plaintiff contends further that Mraz paid all premiums on both his basic and supplemental life insurance policies from November of 2008 until his death in September of 2009.

ALIC ultimately denied Plaintiff's claim for supplemental life insurance benefits on May 11, 2010. ALIC'S denial of supplemental coverage was predicated on its position that, because Mraz's death occurred within two years of its (ALIC'S) approval of his supplemental coverage, it was permitted to investigate Mraz's health history prior to his application for supplemental coverage. ALIC then ruled the Policy inapplicable and denied coverage because Mraz's EOI did not accurately reflect the state of his medical records at the time he applied for supplemental coverage. Essentially, ALIC contends that because Mraz did not disclose that he had been diagnosed with bipolar affective and generalized anxiety disorders, ALIC'S decision to approve his EOI was based on "material misstatements" and, hence, its duty to pay supplemental benefits was vitiated.

There certainly exists a dispute as to whether Mraz was ever actually diagnosed with the mental health problems which ALIC relied upon to deny the supplemental coverage that Mraz thought he had purchased. *fn2 There is also a potential dispute as to whether, even if Mraz was diagnosed with said mental health problems, ALIC's refusal to provide benefits inevitably flowed from its "Medical Underwriting Guidelines".

ALIC has moved to dismiss Counts II and III of Plaintiff's Amended Complaint. ALIC's Motion to Dismiss these counts is based upon its contention that the relief Plaintiff seeks--payment of money damages in the form of life insurance benefits--is not available pursuant to 29 U.S.C. §§ 1132(a)(2) and (3), the statutory grounds underlying Counts II and III of the Amended Complaint.

II. Legal Standard

In McTernan v. City of York, 577 F.3d 521, 530 (3d Cir. 2009), the Third Circuit Court of Appeals set out the standard applicable to a motion to dismiss in light of the United States Supreme Court's decisions Bell Atlantic Corp. v. Twombly, 550 U.S. 433 (2007), and Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937 (2009).

"[T]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true to 'state a claim that relief is plausible on its face.'" Iqbal, 129 S.Ct. at 1949 (citing Twombly, 550 U.S. at 570). The Court emphasized that "only a complaint that states a plausible claim for relief survives a motion to dismiss." Id. at 1950. Moreover, it continued, "[d]etermining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. (citation omitted).

McTernan, 577 F.3d at 530. The Circuit Court discussed the effects of Twombly and Iqbal in detail and provided a road map for district courts presented with a motion to dismiss for failure to state a claim in a case filed just a week before McTernan, Fowler v. UPMC Shadyside, 578 F.3d 203 (3d Cir. 2009).

[D]istrict courts should conduct a two-part analysis. First, the factual and legal elements of a claim should be separated. The District Court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions. [Iqbal, 129 S. Ct. at 1949.] Second, a District Court must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a "plausible claim for relief." Id. at 1950. In other words, a complaint must do more than allege a plaintiff's entitlement to relief. A complaint has to "show" such an entitlement with its facts. See Philips [v. Co. of Alleghany], 515 F.3d [224,] 234-35 [(3d Cir.2008 )]. As the Supreme Court instructed in Iqbal, "[w]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged--but it has not ...

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