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.
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
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
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
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
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
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
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 ...