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Deas v. Prudential Insurance of America

United States District Court, D. South Carolina, Charleston Division

April 26, 2018

Cheryl Deas, Plaintiff,
v.
Prudential Insurance of America, Defendant.

          ORDER

          DAVID C. NORTON UNITED STATES DISTRICT JUDGE

         This matter comes before the court on Prudential Insurance Company of America's (“Prudential”) Motion to Dismiss, ECF No. 7. For the reasons set forth below, the court grants in part the motion and dismisses the case without prejudice.

         I. BACKGROUND

         Cheryl Deas (“Deas”) filed this suit asking the court to grant her the long term disability benefits she claims to be entitled to under the Employee Retirement Income Security Act (“ERISA”). Compl. ¶ 3. Deas was employed at the Summerville Medical Center until May 2015, and claims to have been provided with long term disability insurance coverage through a plan (“the Plan”) insured by Prudential and administered by HCA, Inc. (“HCA”). Id. ¶ 4. Deas alleges that she became disabled and had to cease working, and that she filed a claim for disability benefits in March 2017. Id. ¶¶ 5-6. She alleges that Prudential has failed to reach a decision on her claim in a timely manner in violation of 29 C.F.R. §2560.503-1. Deas claims that this violation allows the court to proceed with the instant action as though she has fully exhausted all of her administrative remedies. She asks the court to declare, pursuant to 29 U.S.C. § 1132(a)(1)(B), that she is entitled to the benefits under the Plan.

         Deas filed suit on November 7, 2017. ECF No. 1. On December 27, 2017, Prudential filed a motion to dismiss. ECF No. 7. On January 19, 2018, Deas filed her response in opposition, ECF No. 11, and on January 25, 2018, Prudential filed its reply. The motion has been fully briefed and is ripe for the court's review.

         II. STANDARD

         Under Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss for “failure to state a claim upon which relief can be granted.” When considering a Rule 12(b)(6) motion to dismiss, the court must accept the plaintiff's factual allegations as true and draw all reasonable inferences in the plaintiff's favor. See E.I. du Pont de Nemours & Co. v. Kolon Indus., 637 F.3d 435, 440 (4th Cir. 2011). But “the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). On a motion to dismiss, the court's task is limited to determining whether the complaint states a “plausible claim for relief.” Id. at 679. Although Rule 8(a)(2) requires only a “short and plain statement of the claim showing that the pleader is entitled to relief, ” “a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). The “complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). “Facts pled that are ‘merely consistent with' liability are not sufficient.” A Soc'y Without a Name v. Virginia, 655 F.3d 342, 346 (4th Cir. 2011) (quoting Iqbal, 556 U.S. at 678).

         III. DISCUSSION

         Deas filed this action asking the court to grant her benefits under the Plan because she claims that Prudential has failed to reach a decision on her insurance claim in a timely manner, and thus her claim is deemed to be denied under 29 C.F.R. § 2560.503-1. Under that provision, “[i]n the case of a claim for disability benefits, the plan administrator shall notify the claimant, in accordance with paragraph (g) of this section, of the plan's adverse benefit determination within a reasonable period of time, but not later than 45 days after receipt of the claim by the plan.” 29 C.F.R. § 2560.503-1(f)(3). This section also allows for an extension of the notification deadline if “necessary due to matters beyond the control of the plan” and if the administrator notifies the claimant of the need for the extension. Id. The federal regulations also provide that if a plan administrator fails to follow these timing requirements, “the claimant is deemed to have exhausted the administrative remedies available under the plan . . . [and] is entitled to pursue any available remedies” under 29 U.S.C. § 1132. 29 C.F.R. § 2560.503-1(1)(2). Section 1132, the civil enforcement provision of ERISA, allows a participant or beneficiary to bring a civil action “to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. § 1132(a)(1).

         Deas filed her claim with Prudential in March 2017. If Prudential intended to deny her claim, then it should have notified her of this within 45 days after receiving her claim or notified her of the 30-day extension for processing her claim. There is no evidence in the complaint or from Prudential that anyone notified Deas of the adverse decision on her claims application, let alone informed her that a decision would take longer than 45 days.[1] Thus, because it appears that Prudential failed to follow the claims procedure, Deas is warranted in bringing the case currently before the court to obtain her benefits under the plan.

         Prudential moves to dismiss Deas's action because she did not make a timely claim for benefits under the applicable ERISA plan. Mot. Dism. at 1. Prudential argues that because Deas failed to submit a timely claim, she has not exhausted her pre-suit administrative remedies as required under ERISA and the Plan, and thus her complaint should be dismissed with prejudice. Id.

         The Plan sets the following time limitations on filing a claim for benefits:

We encourage you to notify us of your claim as soon as possible, so that a claim decision can be made in a timely manner. Written notice of a claim should be sent within 30 days after the date your disability begins. However, you must send Prudential written proof of your claim no later than 90 days after your elimination period ends. If it is not possible to give proof within 90 days, it must be given no later than 1 year after the time proof is otherwise required except in the absence of legal capacity.
The claim form is available from your Employer, or you can request a claim form from us. If you do not receive the form from Prudential within 15 days of your request, send Prudential written ...

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