“You Can’t Bend It That Way, Beckham”: Federal Court Dismisses Plaintiff’s Attempted Claims for Equitable Relief

by Williams Mullen

Following the U. S. Supreme Court’s decision in CIGNA Corp. v. Amara, 131 S. Ct. 1866 (2011), the federal courts have wrestled with the task of defining the scope of remedies for “appropriate equitable relief” under ERISA § 502(a)(3) in response to a broader array of plaintiffs’ claims for such relief. In Beckham v. Liberty Life Assurance Co., No. 2;13-cv-891 (M.D. Ala. Mar. 18, 2014), a federal district court ruled that, although the Supreme Court’s decision expanded the kinds of equitable remedies available to a plaintiff under ERISA § 502(a)(3), the plaintiff could not repackage her benefits claim into an independent claim for equitable remedies. 

The Background.  The plaintiff (Beckham) was employed by Home Depot USA, Inc., which sponsored a long-term disability employee benefit plan (the Plan) funded by an insurance policy sold and underwritten by defendant Liberty Life Assurance Co. (Liberty Life). Liberty Life was also the claim fiduciary under the Plan.
Beckham suffered several strokes in 2012 and became disabled. She filed a claim for benefits under the Plan in September 2012, which Liberty Life approved for payment that month. Subsequently, however, Liberty Life told Beckham that it would begin gathering documentation needed to approve the claim and sent Beckham multiple document authorizations to complete, which Beckham did. On November 6, 2012, Liberty Life denied Beckham’s claim. Shortly afterward, Beckham suffered another stroke and then other medical events.
Beckham appealed Liberty Life’s denial, asserting that Liberty Life had failed to gather records and other needed documentation and did not conduct an adequate and reasonable investigation of her claim. Liberty Life denied the appeal, stating that it had not considered the other documentation because Beckham had not submitted it as part of her supporting evidence. Beckham did subsequently submit the documentation, but Liberty Life contended that her claim file was closed and did not review the documents.
Beckham then filed a lawsuit alleging claims for disability benefits, breach of fiduciary duty and failure to provide plan documents, and seeking an order for equitable relief to remove Liberty Life from its fiduciary role in the Plan’s administration and replace it with a special master to make benefit determinations. Liberty Life moved to dismiss all of Beckham’s claims for equitable relief.
The Court’s Ruling  Accepting Beckham’s allegations as true for the purposes of Liberty Life’s motion to dismiss, the District Court noted first that she had asserted a claim for benefits under ERISA § 502(a)(1)(B).  The District Court also noted that the U. S. Supreme Court’s decision in Varity Corp. v. Howe, 516 U. S. 489 (1996), held that, where Congress provided adequate statutory relief for a benefits claim under ERISA § 502(a)(1)(B)), generally “there will be no need [under ERISA § 502(a)(3)] for further equitable relief.” Such claims under ERISA § 502(a)(3) would be barred in those circumstances. However, the court also noted that it would be the facts on which a case is based, rather than the relief requested, that controlled the outcome. The court therefore gave Beckham’s claim further review in light of the Supreme Court’s decision in CIGNA Corp. v. Amara, to determine whether Beckham’s requested remedies would be allowed under that ruling.
The District Court found key differences between the plaintiffs’ case in CIGNA Corp. and the factual allegations asserted by Beckham. Beckham clearly sought plan benefits under ERISA § 502(a)(1)(B). However, she also argued that equitable relief was needed in the form of a surcharge, removal of Liberty Life as the claim administrator and appointment of a special master to fulfill that role. She alleged that Liberty Life misled her by first telling her that it would gather documentation about her medical condition, then failing to do so and ultimately denying her claim because of the lack of such documentation. “In other words”, said the court, “[Beckham] has alleged that a misrepresentation led to a denial of benefits under the Plan as written, and should be remedied with plan benefits and equitable relief.”
The Beckham court noted that the CIGNA Corp. plaintiffs had alleged a misrepresentation as to whether the plan provided benefits that were not in fact available under the plan. By contrast, Beckham alleged a misrepresentation made in the course of Liberty Life’s denial of benefits in the process of applying the plan. In Beckham’s case, equity did not require a reformation of the plan terms. It must be acknowledged that the court did not hold, for example, that replacing the plan fiduciary with a special master was not an available remedy in all cases. However, the court clearly found that the requested equitable relief was unavailable under these facts, and that, consistent with Varity, Beckham had an adequate remedy through her claim for benefits under ERISA § 502(a)(1)(B). Her claim for equitable relief was therefore dismissed.
The Significant Lessons. Beckham reminds us that there are still limits to the expansion of “appropriate equitable relief” under ERISA § 502(a)(3). While plaintiffs may still allege various misdeeds by plan fiduciaries in the course of claim review, those will not always create a new cause of action independent of the benefits claim itself. The Supreme Court’s decision in Varity Corp. v. Howe continues to provide a pragmatic balance to the scope of equitable relief that might be sought by plaintiffs who interpret CIGNA Corp. v. Amara more expansively.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Williams Mullen | Attorney Advertising

Written by:

Williams Mullen

Williams Mullen on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.