LexisNexis® Legal Newsroom
Mealey's Insurance - Futility Exception Applies In Benefits Denial Suit, 9th Circuit Panel Says

SAN FRANCISCO - A district court abused its discretion in granting summary judgment in favor of a disability insurer because a reasonable insured would have believed that filing an internal appeal of the insurer's denial of benefits would have been futile, the Ninth Circuit U.S. Court of Appeals said March 21 in noting that the futility exception to the exhaustion requirement under the Employee Retirement Income Security Act should have been applied (Richard Carey v. RMB United of Omaha Life Insurance Co., No. 14-55483, 9th Cir.; 2016 U.S. App. LEXIS 5149).

Mealey's Labor & Employment - 8th Circuit Remands ERISA Plan Ruling To Decide If Collateral Estoppel Was Waived

ST. PAUL, Minn. - An Eighth Circuit U.S. Court of Appeals panel on March 22 found that when a trial court issued judgment against benefits plans administrators' claims brought under the Employee Retirement Income Security Act against Wells Fargo Bank N.A. based on a jury's verdict related to non-ERISA plans, it "failed to consider whether the parties waived application of collateral estoppel," leading it to vacate and remand for a determination of whether such waiver occurred (Blue Cross Blue Shield of Minnesota, et al. v. Wells Fargo Bank N.A., No. 14-3457, 8th Cir.; 2016 U.S. App. LEXIS 5198).

Mealey's Labor & Employment - 3rd Circuit Affirms Denial of Severance Benefits For Disabled Employee

PHILADELPHIA - A New Jersey federal judge did not err in granting the Severance Pay Plan of Johnson & Johnson and Affiliated U.S. Companies (the plan) summary judgment on allegations that it violated the Employee Retirement Income Security Act (ERISA) by denying an employee's request for severance benefits, the Third Circuit U.S. Court of Appeals concluded March 21 in an unpublished ruling (Alan M. Becknell v. Severance Pay Plan of Johnson & Johnson and Affiliated U.S. Companies, No. 15-2660, 3rd Cir.; 2016 U.S. App. LEXIS 5071).

Mealey's Litigation Procedure - Zappos Argues That Class Action Over Data Breach Merits Dismissal

RENO, Nev. - In a pair of March 18 reply briefs in Nevada federal court, online retailer Zappos.com Inc. argues in support of its previously filed motions to dismiss putative class claims related to a 2012 breach of its network and to strike the plaintiffs' class claims, asserting that the plaintiffs did not plausibly plead any harm attributable to the breach (In Re Zappos.com Inc., Customer Data Security Breach Litigation, No. 3:12-cv-00325, D. Nev.).

Mealey's Labor & Employment - Plan Must Be Established By Church To Qualify For Exception, 7th Circuit Says

CHICAGO - A retirement plan established by a church-affiliated organization is not exempt from the reach of the Employee Retirement Income Security Act, the Seventh Circuit U.S. Court of Appeals ruled March 17 (Maria Stapleton, et al. v. Advocate Health Care Network, No. 15-1368, 7th Cir.; 2016 U.S. App. LEXIS 4908).

Mealey's Labor & Employment - 2nd Circuit: Claims Over Lehman Brothers Plan Not Plausibly Pleaded

NEW YORK - A New York federal judge properly rejected allegations that the fiduciaries of an employee stock ownership plan (ESOP) invested exclusively in Lehman Brothers Holdings Inc. stock breached their duties under the Employee Retirement Income Security Act by failing to recognize Lehman's imminent collapse, the Second Circuit U.S. Court of Appeals ruled March 18 (In Re: Lehman Bros. Sec. and ERISA Litig., No. 15-2229, 2nd Cir.).

Mealey's Labor & Employment - High Court Will Not Review 9th Circuit's Plan Assets Ruling

WASHINGTON, D.C. - The U.S. Supreme Court on March 21 denied a request to consider whether parties can agree to classify an employer's unpaid contributions to an employee benefit plan as plan assets under the Employee Retirement Income Security Act (The Board of Trustees of the Carpenters Health and Welfare Trust Fund for California, et al. v. Gregory Bos, No. 15-755, U.S. Sup.).

Mealey's Litigation Procedure - Judge Denies Motion To Dismiss In Securities Suit Against Chinese Company

LOS ANGELES - Without providing further detail, a federal judge in California on March 15 denied a motion to dismiss filed by defendants in a securities class action lawsuit, ruling that the defendants' arguments should be brought as a motion for summary judgment (Joseph Fragala v. 500.com Limited, et al., No. 15-1463, C.D. Calif.).

Mealey's Litigation Procedure - Judge: Investors Fail To Meet Adequacy Requirement As Class Representatives

KANSAS CITY, Kan. - A federal judge in Kansas on March 14 denied a motion to certify a class of investors in a securities class action lawsuit, ruling that investors failed to show, as statutorily required, that they or their choice of lead counsel would adequately represent the proposed class (Stan Better, et al. v. YRC Worldwide Inc., et al., No. 11-2072, D. Kan.; 2016 U.S. Dist. LEXIS 32664).

Mealey's Securities/D&O Liability - Judge: Exchange Company's Post-ACA Guidance Didn't Violate Securities Law

SAN FRANCISCO - A health exchange company's officer's opinions regarding their financial health after passage of the Patient Protection and Affordable Care Act (ACA) and forward-looking statements with adequate warnings do not support class action claims under securities law, a federal judge in California held March 14 (Jeffrey West v. eHealth Inc., et al., No. 15-360, N.D. Calif.; 2016 U.S. Dist. LEXIS 33429).

Mealey's Litigation Procedure - Judge: Exchange Company's Post-ACA Guidance Didn't Violate Securities Law

SAN FRANCISCO - A health exchange company's officer's opinions regarding their financial health after passage of the Patient Protection and Affordable Care Act (ACA) and forward-looking statements with adequate warnings do not support class action claims under securities law, a federal judge in California held March 14 (Jeffrey West v. eHealth Inc., et al., No. 15-360, N.D. Calif.; 2016 U.S. Dist. LEXIS 33429).

Mealey's Securities/D&O Liability - Judge: Investors Fail To Meet Adequacy Requirement As Class Representatives

KANSAS CITY, Kan. - A federal judge in Kansas on March 14 denied a motion to certify a class of investors in a securities class action lawsuit, ruling that investors failed to show, as statutorily required, that they or their choice of lead counsel would adequately represent the proposed class (Stan Better, et al. v. YRC Worldwide Inc., et al., No. 11-2072, D. Kan.; 2016 U.S. Dist. LEXIS 32664).

Mealey's Securities/D&O Liability - Judge Denies Motion To Dismiss In Securities Suit Against Chinese Company

LOS ANGELES - Without providing further detail, a federal judge in California on March 15 denied a motion to dismiss filed by defendants in a securities class action lawsuit, ruling that the defendants' arguments should be brought as a motion for summary judgment (Joseph Fragala v. 500.com Limited, et al., No. 15-1463, C.D. Calif.).

Mealey's Banking & Finance - Judge: Exchange Company's Post-ACA Guidance Didn't Violate Securities Law

SAN FRANCISCO - A health exchange company's officer's opinions regarding their financial health after passage of the Patient Protection and Affordable Care Act (ACA) and forward-looking statements with adequate warnings do not support class action claims under securities law, a federal judge in California held March 14 (Jeffrey West v. eHealth Inc., et al., No. 15-360, N.D. Calif.; 2016 U.S. Dist. LEXIS 33429).

Mealey's Litigation Procedure - Class Suit Over Tax Refunds Offsets Tossed By D.C. Federal Judge

WASHINGTON, D.C. - A District of Columbia federal judge on March 15 dismissed a class complaint against several federal government entities involved in the alleged interception of tax refunds and application of those funds to alleged overpayments by the U.S. Social Security Administration (SSA), finding that the plaintiffs' claims are now moot (Tina Heard, et al. v. United States Social Security Administration, et al., No. 15-230, D. D.C.; 2016 U.S. Dist. LEXIS 32748).

Mealey's Litigation Procedure - Judge: Defendants Did Not Meet Requirements In Seeking Appeal In Securities Suit

HOUSTON - A federal judge in Texas on March 14 denied three motions for certification of an order for interlocutory appeal in a securities class action lawsuit, ruling that the issues raised by defendants in the action failed to meet statutory requirements for certification (In re Cobalt International Energy Inc. Securities Litigation, No. 14-3428, S.D. Texas; 2016 U.S. Dist. LEXIS 32173).

Mealey's Labor & Employment - Plan's Limitations Period Is Inapplicable, 1st Circuit Appeals Panel Determines

BOSTON - A disability plan's limitations period of three years is inapplicable, and Puerto Rico's 15-year statute of limitations must be applied because the insurer violated Employee Retirement Income Security Act regulations when it failed to inform the disability claimant of the plan-imposed time limit for filing a suit, the First Circuit U.S. Court of Appeals said March 14 (Dionisio Santana- Diaz v. Metropolitan Life Insurance Co., No. 15-1273, 1st Cir.; 2016 U.S. App. LEXIS 4670).

Mealey's Labor & Employment - Government: Complaint Against BP Satisfies Dudenhoeffer Standard

NEW ORLEANS - In a March 11 amicus curiae brief, Secretary of Labor M. Patricia Smith told the Fifth Circuit U.S. Court of Appeals that a consolidated Employee Retirement Income Security Act action against BP PLC satisfies the pleading standard set in Fifth Third Bancorp v. Dudenhoeffer (134 S. Ct. 2459 [2014]) and should proceed (Ralph Whitley, et al. v. BP PLC, et al., No. 15-20282, 5th Cir.).

Mealey's Securities/D&O Liability - Judge: Defendants Did Not Meet Requirements In Seeking Appeal In Securities Suit

HOUSTON - A federal judge in Texas on March 14 denied three motions for certification of an order for interlocutory appeal in a securities class action lawsuit, ruling that the issues raised by defendants in the action failed to meet statutory requirements for certification (In re Cobalt International Energy Inc. Securities Litigation, No. 14-3428, S.D. Texas; 2016 U.S. Dist. LEXIS 32173).

Mealey's Insurance - Plan's Limitations Period Is Inapplicable, 1st Circuit Appeals Panel Determines

BOSTON - A disability plan's limitations period of three years is inapplicable, and Puerto Rico's 15-year statute of limitations must be applied because the insurer violated Employee Retirement Income Security Act regulations when it failed to inform the disability claimant of the plan-imposed time limit for filing a suit, the First Circuit U.S. Court of Appeals said March 14 (Dionisio Santana-Diaz v. Metropolitan Life Insurance Co., No. 15-1273, 1st Cir.; 2016 U.S. App. LEXIS 4670).

Mealey's Litigation Procedure - Insurer To Pay $219M To Settle Claims In Securities Class Action Lawsuit

RICHMOND, Va. - An insurance holding company will pay $219 million to settle claims filed in a Virginia federal court that it issued misrepresentations regarding the company's business and financial condition in violation of federal securities laws, according to a press release issued by the company on March 11 (In re Genworth Financial Inc. Securities Litigation, No. 14-682, E.D. Va.).

Mealey's Securities/D&O Liability - Panel: No Fraud Exception To Attorney Immunity Exists In Ponzi Scheme Suit

NEW ORLEANS - Because the Texas Supreme Court has clarified that no "fraud exception" to attorney immunity exists, a federal district court erred in denying dismissal of related securities lawsuits stemming from the massive R. Allen Stanford Ponzi scheme, a Fifth Circuit U.S. Court of Appeals panel ruled March 10 (Proskauer Rose LLP, et al. v. Samuel Troice, et al., No. 15-10500, 5th Cir.).

Mealey's Securities/D&O Liability - Insurer To Pay $219M To Settle Claims In Securities Class Action Lawsuit

RICHMOND, Va. - An insurance holding company will pay $219 million to settle claims filed in a Virginia federal court that it issued misrepresentations regarding the company's business and financial condition in violation of federal securities laws, according to a press release issued by the company on March 11 (In re Genworth Financial Inc. Securities Litigation, No. 14-682, E.D. Va.).

Mealey's PI/Product Liability - 2nd Circuit Panel Affirms Dismissal Of Securities Class Action Pursuant To Omnicare

NEW YORK - A federal district court did not err in dismissing two related securities class action lawsuits for failure to plead a material misrepresentation pursuant to the U.S. Supreme Court's ruling in Omnicare Inc., et al. v. The Laborers District Council Construction Industry Pension Fund and The Cement Masons Local 526 Combined Funds because the defendants' optimistic statements were not misleading, a Second Circuit U.S. Court of Appeals panel ruled March 7 (Gen. Partner Glenn Tongue, et al. v. Sanofi, et al., Nos. 15-588 and 15-623, 2nd Cir.; 2016 U.S. App. LEXIS 4107).

Mealey's Litigation Procedure - 2nd Circuit Panel Affirms Dismissal Of Securities Class Action Pursuant To Omnicare

NEW YORK - A federal district court did not err in dismissing two related securities class action lawsuits for failure to plead a material misrepresentation pursuant to the U.S. Supreme Court's ruling in Omnicare Inc., et al. v. The Laborers District Council Construction Industry Pension Fund and The Cement Masons Local 526 Combined Funds because the defendants' optimistic statements were not misleading, a Second Circuit U.S. Court of Appeals panel ruled March 7 (Gen. Partner Glenn Tongue, et al. v. Sanofi, et al., Nos. 15-588 and 15-623, 2nd Cir.; 2016 U.S. App. LEXIS 4107).