“No one loves the messenger who brings bad news.Antigone (lines 276-77).

What happens when an ERISA claimant brings state law claims against independent medical consultants retained by the Plan to provide medical reviews eventually relied upon in claim denials?

Are these claims preempted by ERISA?

Good news: Sometimes yes.

Here’s the case of Cacoperdo v Hartford Life Ins. Co., 2011 WL 4632881 (S.D.N.Y October 5, 2011) [PDF] (state law claims against plan’s independent medical consultants preempted by ERISA; Court also denies Plaintiff discovery propounded to independent physicians as a “fishing expedition”).

FACTS: Cacoperdo sought ERISA disability benefits from his employer’s plan. He received benefits for a while but eventually Hartford retained two different companies to prepare independent medical review reports. Hartford relied on these reports to deny the disability claim.

Plaintiff then sued, asserting ERISA claims against Hartford and state law tortious interference claims against the physicians providing independent reviews.

Plaintiff’s theory: The independent medical consultants are not ERISA entities. “[The independent medical consultants] knew or should have known of a valid contract between Hartford and the Plaintiff, and that they induced Hartford to breach the contract by creating medical findings that would lead Hartford to fail to discharge its duties and obligations under the contract.”

ISSUE: Whether claims against medical consultants are preempted by ERISA?

TRIAL COURT HELD: The claims against the physicians are preempted. The Court also denies discovery from the physicians.

RATIONALE:

  1. Unlike other court decisions which allowed state law invasion of privacy claims (Dishman v. UNUM, 269 F.3d 974 (9th Cir. 2001)) or outrage claims (Barker v. Hartford, 2007 U.S. Dist Lexis 55532 (N.D. Tex. July 31, 2007)), Plaintiff’s claim here specifically “derive[s] from his benefits claim….[T]he state law claim here stems from the Plan that is breached—not an independent duty of care owed to the Plaintiff [by the independent medical reviewers].” Op. at 5.
  2. “There was no direct evidence that [the physicians] breached an independent duty of care owed to Cacoperdo.” Op. at 5.
  3. The Court denied discovery from the physicians. The Court said: “[N]o factual allegations have been pled with any amount of specificity against [the reviewing physicians] that would support an independent state law tort cause of action against them. The Court will not allow Cacoperdo to engage in a fishing expedition against non-fiduciary third party vendors in order to determine whether any factual allegations can be made.Op. at 6 (Emph. added).
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Photo of Mike Reilly Mike Reilly

Mike Reilly is a nationally recognized labor, employment and employee benefits attorney, named one of the “Top 100 Most Powerful Employment Attorneys in the Nation” for the past five consecutive years by Human Resource Executive®. He has decades of experience providing strategic employment…

Mike Reilly is a nationally recognized labor, employment and employee benefits attorney, named one of the “Top 100 Most Powerful Employment Attorneys in the Nation” for the past five consecutive years by Human Resource Executive®. He has decades of experience providing strategic employment advice, and has represented clients in more than 75 jury trials, arbitrations, bench trials and claims before the EEOC and Washington State Human Rights Commission.

Small and large employers retain Mike for his strategic advice and decades of experience in employment issues and litigation, business decisions and litigation avoidance. Mike provides advice in claims involving discrimination, retaliation, wrongful discharge, disability accommodation, ERISA and non-ERISA employee benefit claims, and wage/hour claims. He served as lead counsel in an employee raiding/trade secret case as reported in the Wall Street Journal, and defends employers in class action claims.

Mike’s remarks on employment issues have been quoted in NewsweekCorporate Legal TimesSeattle TimesEmployee Relations Law JournalPuget Sound Business JournalCFO.com, and other professional journals and management publications. Chambers USA’s Guide to America’s Leading Lawyers for Businessrates Mike in the top ranking (band one) for his work in labor and employment law, and has described him as “one of Seattle’s top-rate attorneys” who is “truly phenomenal [with] superb legal instincts” and “an amazingly assertive litigator.” His clients include Nordstrom, Seattle Seahawks, Home Depot, KeyBank, Starbucks, Fred Hutchinson Cancer Research Center, Red Robin and Seattle Chamber of Commerce, among others.