Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MADAFFARI v. METROCALL COMPANIES GROUP POLICY GL

January 9, 2004.

CHERYL MADAFFARI, Plaintiff;
v.
METROCALL COMPANIES GROUP POLICY GL, H-21163-0, PLAN NUMBER 501, Defendant



The opinion of the court was delivered by: AMY J. ST. EVE, District Judge

MEMORANDUM OPINION AND ORDER

Defendant Metrocall Companies Group Policy GL, H-21163-0, Plan Number 501 ("Plan 501") has moved to vacate default judgment under Rule 60(b)(1) and (4) and to join ReliaStar Life Insurance Company ("ReliaStar") as an indispensable party to this action under Rule 19(a). For the reasons set forth below, Defendant's motion is granted.

BACKGROUND

  Metrocall, Inc, ("Metrocall"), employed Plaintiff Cheryl Madaffari as a sales manager. As part of her employment benefits, Metrocall provided Plaintiff with health and disability insurance. In late 1997, Plaintiff stopped working because of health problems and began claiming disability under her insurance policy. Plaintiff collected disability benefits from March 1997 until November 2000, when ReliaStar reviewed Plaintiff's claim and concluded that she was no longer disabled according to the terms of the insurance policy. Plaintiff appealed her denial of benefits to ReliaStar, who denied Plaintiff's appeal in March 2001. Plaintiff then Page 2 requested that ReliaStar reconsider its denial of Plaintiff's claim. In July 2001, ReliaStar again refused Plaintiff's claim.

  Plan 501, the named Defendant in this action, is an insured employee welfare benefit plan governed by the Employee Retirement Income Securities Act ("ERISA"). Plan 501 provides benefits to Metrocall employees through an insurance policy issued by ReliaStar. Beyond the insurance policy, Plan 501 has no assets. ReliaStar issued the policy that is Plan 501's sole asset. In that role, ReliaStar made all determinations pertaining to claims and paid benefits on claims. With respect to Plaintiff's claim, ReliaStar made all decisions regarding termination of disability, including the determinations on Plaintiff's appeals. Plaintiff does not allege, and the facts do not show, that Metrocall played any role in determining whether or not Plaintiff was entitled to benefits under her insurance policy.

  Metrocall was Plaintiff's employer and is the sponsor of Plan 501. In connection with its role as sponsor, Metrocall paid the premiums for the ReliaStar insurance policy. Metrocall did not make decisions as to claim status, coverage, or any aspect of claims administration.

  Following the denial of her appeal by ReliaStar, Plaintiff brought this ERISA action against Plan 501 to recover benefits under her plan. Plaintiff served William L. Collins, President and Chief Executive Officer of Metrocall on September 13, 2002. Metrocall forwarded the complaint to ReliaStar and confirmed that ReliaStar would deal with the complaint. Subsequently, ReliaStar took no action in this matter and on November 6, 2002, the Court granted Plaintiff's motion for default. During the following months, attorneys for Plaintiff attempted to contact Metrocall, finally succeeding in August of 2003. Plaintiff's attorney requested Metrocall to comply with the Court's order of judgment. After requesting copies of the Page 3 relevant documents, Defendant Plan 501 filed its motion to vacate default judgment and join ReliaStar as an indispensable party.

  In support of its motion to vacate default judgment, Defendant argues that Plaintiff's service upon Metrocall's president and CEO does not amount to effective service of process on Plan 501, Alternatively, Defendant argues that its default in this action was the result of excusable neglect. Plaintiff responds that she properly served the complaint, Defendant had actual notice of the complaint in accordance with due process, and the default judgment was not the result of excusable neglect.

  In support of its motion to join ReliaStar as an indispensable party, Defendant argues that ReliaStar made all of the decisions relevant to Plaintiff's lawsuit, that ReliaStar is obligated to pay benefits on valid claims, and that Defendant has no assets aside from the insurance policy. Plaintiff counters that employers are proper ERISA defendants where the employer and plan are intertwined and the employer is listed as the plan administrator.*fn1

  ANALYSIS

 A. Default Judgment

  Federal Rule of Civil Procedure 60(b)(4) allows a court to relieve a party from a final judgment if that judgment is void. If a court lacks personal jurisdiction over a defendant, then the court's judgment in that action is void. Kravit, Gass & Weber, S.C. v. Michel, 134 F.3d 831, 838 (7th Cir. 1998). In order for a court to assert personal jurisdiction over a defendant, valid Page 4 service of process must occur first. Mid-Continent Wood Prods., Inc. v. Harris, 936 F.2d 297, 301 (7th Cir. 1991). Without valid service of process, therefore, a default judgment is void. Fleet Mortgage Corp. v. Wise, No. 92 C 1102, 1997 WL 305319, at *1 (N.D. Ill. May 29, 1997); Fed. Equip. Corp. v. Puma Indus. Co., Ltd., 182 F.R.D. 565, 567 (N.D. Ill. 1998).

  Plaintiff points out that ERISA governs the service of process on defendants in actions brought under that statute. The statute provides that serving process upon an administrator of an employee benefit plan will constitute valid service on the benefit plan itself. 29 U.S.C. § 1132(d)(1). When Plaintiff originally filed her disability claim, the plan document listed the Director of Human Resources of Metrocall as the plan administrator. A subsequent plan document named Metrocall's Director of Benefits and Compensation as the administrator of the plan. The plan documents also list Metrocall's General Counsel as an agent for service of process.

  When Plaintiff sued Plan 501, she did not serve Metrocall's Director of Human Resources, Director of Benefits and Compensation, or General Counsel. Instead, she served Metrocall's president and CEO, who is not listed as plan ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.