United States District Court, D. Maryland
DOUGLAS SLOAN, Individually, and as Personal Representative of the Estate of Susan Sloan Plaintiff,
LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant/Cross-Claim Defendant and PRA HEALTH SCIENCES, INC., Defendant/Cross-Claim Plaintiff
P. GESNER CHIEF UNITED STATES MAGISTRATE JUDGE
pending before the court are plaintiff Douglas Sloan's
Motion for Leave to File Second Amended Complaint
(“Motion”) (ECF No. 29), defendant PRA Health
Sciences, Inc.'s (“PRA”) Opposition to
Plaintiff's Motion for Leave to File Second Amended
Complaint (“Opposition”) (ECF No. 31), and
Plaintiff's Reply to PRA's Opposition to Motion for
Leave to File Second Amended Complaint (“Reply”)
(ECF No. 32). The issues are fully briefed, and no hearing is
necessary. Loc. R. 105.6. For the reasons stated below,
plaintiff's Motion (ECF No. 29) is granted.
Employee Retirement Income Security Act of 1974
(“ERISA”) case, plaintiff asserts a claim against
PRA and LINA for benefits arising from a life insurance
policy (LINA and PRA hereinafter referred to collectively as
“defendants”). (ECF No. 19 at ¶¶
36-39). Plaintiff filed this lawsuit individually and as
personal representative of the estate of his deceased wife,
Susan Sloan. According to the Amended Complaint, Ms. Sloan
was employed by PRA and participated in Group Life Insurance
Policy No. FLX 963879 (the “Policy”) which
provided life insurance benefits under an employee benefit
plan (the “Plan”) established by PRA for its
employees. (Id. at ¶ 14). LINA issued the
Policy and PRA served as the Plan administrator.
(Id. at ¶¶ 14, 20).
the Policy, Ms. Sloan elected life insurance coverage in the
amount of $360, 000 and named Plaintiff as the beneficiary.
(Id. at ¶ 14). The Policy provided a conversion
privilege wherein Ms. Sloan had the right to convert coverage
under the Policy into an individual life insurance policy if
coverage under the Policy was terminated. (Id. at
¶ 24). To obtain conversion insurance, the Policy
required Ms. Sloan to submit an application within 31 days of
termination of coverage under the Policy, which would be
extended by 15 days, up to a maximum of 90 days, if Ms. Sloan
was not notified of this right at least 15 days prior to the
end of the conversion period. (Id.)
Sloan's life insurance coverage under the Policy
continued through September 30, 2016. (Id. at ¶
20). After this date, however, PRA stopped its payment of
Policy premiums and coverage terminated on October 1, 2016.
(Id.) Ms. Sloan died on December 1, 2016.
(Id. at ¶ 16). In January 2017, Plaintiff
submitted a claim for life insurance benefits under the
Policy. (Id. at ¶ 17). LINA denied
plaintiff's claim and plaintiff's subsequent appeal
on the grounds that PRA had stopped payment of premiums, and
because Ms. Sloan had not converted coverage into an
individual policy, her participation in the Policy terminated
prior to her death. (Id. at ¶¶ 5, 17).
Plaintiff alleges that either or both defendants were
required to provide Ms. Sloan with written notice of
PRA's intention to stop payment of premiums and of Ms.
Sloan's right to convert the Policy into an individual
life insurance policy with LINA. (Id. at ¶ 4).
Plaintiff further alleges that neither of these notices were
provided by defendants, which resulted in Plaintiff's
loss of $360, 000 in life insurance benefits. (Id.
at ¶¶ 25, 31, 40).
original Complaint (ECF No. 1), plaintiff asserted three
claims under ERISA and two claims under state law. (ECF No. 1
at 11-15). Plaintiff's first two claims under ERISA
included a claim for benefits under ERISA § 502(a)(1)(B)
and a claim for equitable relief under ERISA §
502(a)(3), each for “violations of the terms of the
policy/plan” against PRA and the insurance
company. (Id. at 11). Plaintiff's
third claim under ERISA was a claim against PRA and the
insurance company for equitable relief under ERISA §
502(a)(2) for a breach of fiduciary duty. (Id. at
12-13). PRA sought to dismiss plaintiff's claims for
equitable relief for failure to state a claim. (ECF No. 11 at
1). PRA argued that dismissal of plaintiff's request for
equitable relief under ERISA was appropriate because,
contrary to Supreme Court and Fourth Circuit precedent,
plaintiff's claim for equitable relief “simply
recast an individual claim for Plan benefits as a breach of
fiduciary duty claim.” (ECF No. 11-1 at 2 (citing
Varity Corp. v. Howe, 516 U.S. 489, 512, 515 (1996);
Mass. Mut Life Ins. Co. v. Russell, 473 U.S. 134,
140 (1985); Korotynska v. Metro. Life. Ins. Co., 474
F.3d 101, 107-08 (4th Cir. 2006))). In response, plaintiff
filed an Amended Complaint (ECF No. 19) wherein he removed
the state law claims and the claims for equitable relief
under ERISA § 502(a)(3) and § 502(a)(2).
(Id. at 11-12). The sole remaining claim in
plaintiff's Amended Complaint is a claim against LINA and
PRA for life insurance benefits under ERISA §
502(a)(1)(B). Plaintiff now seeks leave to file a Second
Amended Complaint to reassert a claim for equitable relief
under § 502(a)(3) against PRA and to remove the claim
against PRA under § 502(a)(1)(B). (ECF No. 29 at 2). In
sum, plaintiff's proposed Second Amended Complaint
contains two claims: (1) a claim for benefits against LINA
under § 502(a)(1)(B), and (2) a claim of breach of
fiduciary duty against PRA under § 502(a)(3).
STANDARD OF REVIEW
to Federal Rule of Civil Procedure 15(a)(2), a party is
permitted to amend his pleadings with the written consent of
the opposing party or by leave of the court. Fed.R.Civ.P.
15(a)(2). Rule 15(a)(2) provides that “[t]he court
should freely give leave when justice so requires.”
Leave to amend a pleading should be denied, however,
“when the amendment would be prejudicial to the
opposing party, there has been bad faith on the part of the
moving party, or the amendment would be futile.”
Johnson v. Oroweat Foods Co., 785 F.2d 503, 509 (4th
Cir. 1986). A proposed amendment is futile if it “fails
to satisfy the requirements of the federal rules” or,
in other words, could not survive a motion to dismiss.
Katyle v. Penn Nat. Gaming, Inc., 637 F.3d 462, 471
(4th Cir. 2011) (quoting U.S. ex rel. Wilson v. Kellogg
Brown & Root, Inc., 525 F.3d 370, 376 (4th Cir.
2008)). Under Rule 12(b)(6), a complaint may be dismissed for
failure to state a claim upon which relief can be granted.
ruling on a motion to dismiss for failure to state a claim
under Rule 12(b)(6), the court must “accept all
well-pleaded allegations in the plaintiff's complaint as
true” and “draw all reasonable factual
inferences from those facts in the plaintiff's
favor.” Edwards v. City of Goldsboro, 178 F.3d
231, 244 (4th Cir. 1999). Nonetheless, “[t]he mere
recital of elements of a cause of action, supported only by
conclusory statements, is not sufficient to survive a motion
made pursuant to Rule 12(b)(6).” Walters v.
McMahen, 684 F.3d 435, 439 (4th Cir. 2012) (citing
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).
Rather, “a complaint must contain sufficient factual
matter . . . to state a claim to relief that is plausible on
its face.” Ashcroft, 556 U.S. at 678 (internal
citation and quotation marks omitted). A plaintiff satisfies
this standard not by forecasting evidence sufficient to prove
the elements of the claim, but by alleging sufficient facts
to establish those elements. Walters, 684 F.3d at
439. Accordingly, “while a plaintiff does not need to
demonstrate in a complaint that the right to relief is
‘probable,' the complaint must advance the
plaintiff's claim ‘across the line from conceivable
to plausible.'” Id. (citing Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
seeks to amend the Complaint for a second time to
“bring a separate cause of action against . . . PRA,
under § 502(a)(3), . . . seeking equitable relief for
breach of fiduciary duties.” (ECF No. 29 at 2).
Plaintiff argues the “court should freely give leave
[to amend] when justice so requires.” (Id. at
3 (quoting Fed.R.Civ.P. 15(a)(2)). Plaintiff maintains there
is no prejudice to defendants in allowing this amendment
because plaintiff previously consented to defendants'
extension of time to respond to the Complaint and there are
no court dates set or discovery requests pending.
however, opposes plaintiff's request to amend the
Complaint, arguing that “[j]ustice does not require
permitting leave to amend when [the] amendment would be
futile.” (ECF No. 31 at 2). PRA contends
plaintiff's proposed amendment is futile and could not
withstand a motion to dismiss under Rule 12(b)(6) because it
“impermissibly recasts an individual claim for benefits
as a fiduciary breach.” (Id. at 6).
Specifically, PRA argues that the breach of fiduciary claim
is really a claim for benefits because plaintiff alleges the
same facts under both causes of action and demands payment of
the policy proceeds as a remedy for both causes of action.
(Id. at 8). PRA contends that plaintiffs in the
Fourth Circuit “are not permitted to ‘seek relief
simultaneously under § 502(a)(1)(B) and § 502(a)(3)
when the injury alleged creates a cause of action under
§ 502(a)(1)(B).'” (Id. at 9 (quoting
Conn. Gen. Life Ins. Co. v. Advanced Surgery Ctr. of
Bethesda, LLC, Civ. No. DKC 14-2376, 2015 WL 4394408, at
*2 (D. Md. July 15, 2015))).
ERISA Section 502(a)(1)(B), an ERISA plan participant or
beneficiary may bring a claim “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)(B) (2018). Under ERISA Section
502(a)(3), a plan participant or beneficiary may bring a
claim to “(A) enjoin any act or practice which violates
any provision of [ERISA] or the terms of the plan, or (B) to
obtain other appropriate ...