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Enenstein v. Eagle Insurance Agency

June 7, 2006


The opinion of the court was delivered by: Samuel Der-yeghiayan, District Judge


This matter is before the court on Defendants' motion to dismiss. For the reasons stated below, we deny the motion to dismiss.


Plaintiff Louis Enenstein ("Enenstein") alleges that from September 2003 to January 2004, he was employed as an accountant for Defendant Eagle Insurance Agency, Inc. ("Eagle"). Eagle allegedly provides its employees with the Eagle Insurance Agency Group Health Plan ("Plan"), which is provided through Humana Health Insurance Company ("Humana") and is administered by Defendant Robert Gainsberg ("Gainsberg"). Enenstein asserts that after his employment with Eagle ended, Eagle and Gainsberg failed to notify Enenstein that he was qualified for continued insurance coverage under the Consolidated Omnibus Budget Reconciliation Act ("COBRA"), 29 U.S.C. § 1161 et seq. Enenstein also alleges that Eagle and Gainsberg falsely notified Humana that Enenstein was not eligible for COBRA benefits.

According to Enenstein, the "Illinois Division of Insurance" ("Division") investigated his complaint and documented the alleged false statements that Eagle and Gainsberg made to Humana concerning Enenstein's right to continued insurance coverage. (Compl. Par. 9). Enenstein states that after the Division's investigation, Defendants agreed to represent to Humana that Enenstein was entitled to continued insurance coverage. Enenstein contends that Eagle and Gainsberg were required to have informed Humana of Enenstein's correct insurance status a year earlier than when they chose to do so. Enenstein brought the instant action and includes in his complaint claims alleging that Eagle and Gainsberg violated the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132 et seq., and COBRA. Defendants move to dismiss this action.


In ruling on a motion to dismiss brought pursuant to Federal Rule of Civil Procedure 12(b)(6), the court must draw all reasonable inferences that favor the plaintiff, construe the allegations of the complaint in the light most favorable to the plaintiff, and accept as true all well-pleaded facts and allegations in the complaint.

Thompson v. Illinois Dep't of Prof'l Regulation, 300 F.3d 750, 753 (7th Cir. 2002); Perkins v. Silverstein, 939 F.2d 463, 466 (7th Cir. 1991). The allegations of a complaint should not be dismissed for a failure to state a claim "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957); see also Baker v. Kingsley, 387 F.3d 649, 664 (7th Cir. 2004)(stating that although the "plaintiffs' allegations provide[d] little detail . . . [the court could not] say at [that] early stage in the litigation that plaintiffs [could] prove no set of facts in support of their claim that would entitle them to relief"). Nonetheless, in order to withstand a motion to dismiss, a complaint must allege the "operative facts" upon which each claim is based. Kyle v. Morton High School, 144 F.3d 448, 454-55 (7th Cir. 1998); Lucien v. Preiner, 967 F.2d 1166, 1168 (7th Cir. 1992). Under the current notice pleading standard in federal courts, a plaintiff need not "plead facts that, if true, establish each element of a 'cause of action . . . .'" Sanjuan v. American Bd. of Psychiatry and Neurology, Inc., 40 F.3d 247, 251 (7th Cir. 1994)(stating also that "[a]t this stage the plaintiff receives the benefit of imagination, so long as the hypotheses are consistent with the complaint" and that "[m]atching facts against legal elements comes later"). The plaintiff need not allege all of the facts involved in the claim and can plead conclusions. Higgs v. Carver, 286 F.3d 437, 439 (7th Cir. 2002); Kyle, 144 F.3d at 455. However, any conclusions pled "must provide the defendant with at least minimal notice of the claim," id., and the plaintiff cannot satisfy federal pleading requirements merely "by attaching bare legal conclusions to narrated facts which fail to outline the bases of [his] claims." Perkins, 939 F.2d at 466-67. The Seventh Circuit has explained that "[o]ne pleads a 'claim for relief' by briefly describing the events." Sanjuan, 40 F.3d at 251; Nance v. Vieregge, 147 F.3d 589, 590 (7th Cir. 1998)(stating that "[p]laintiffs need not plead facts or legal theories; it is enough to set out a claim for relief").


Defendants argue that Enenstein did not bring the instant action within the statute of limitations period for a claim alleging a violation of COBRA. Defendants also argue that Enenstein lacks standing to bring an ERISA claim because he is not a participant or beneficiary of the Plan. Finally, Defendants argue that the court must dismiss the ERISA claims because Enenstein has not named the Plan as a Defendant in this action.

I. COBRA Statute of Limitations

Defendants argue that Enenstein did not bring his COBRA claims within the applicable statute of limitations period. Defendants argue that since COBRA does not contain any specific statute of limitations provision, the court should adopt the two-year statute of limitations period applied under Illinois law to claims brought against insurance providers. (Mot. 3). A plaintiff is not required to anticipate and respond to "an affirmative defense, such as the statute of limitations, in his complaint," Clark v. City of Braidwood, 318 F.3d 764, 767-68 (7th Cir. 2003), but a plaintiff "can plead himself out of court if he alleges facts that affirmatively show that his suit is time-barred . . . ." Id.; see also United States v. Lewis, 411 F.3d 838, 842 (7th Cir. 2005)(stating that a plaintiff can plead himself out of court on the basis of a statute of limitations bar "where . . . the allegations of the complaint itself set forth everything necessary to satisfy the affirmative defense, such as when a complaint plainly reveals that an action is untimely under the governing statute of limitations"); Leavell v. Kieffer, 189 F.3d 492, 494-95 (7th Cir. 1999)(stating that "[t]he statute of limitations is an affirmative defense [and that] [c]complaints need not anticipate or plead around affirmative defenses" and stating that "there is no problem under Rule 12(b)(6)").

In the instant action, Enenstein alleges that his employment was terminated on January 16, 2004. (Compl. Par. 1). The instant action was filed on February 2, 2006. Defendants argue that since the action was filed more than two years after Enenstein's termination, his COBRA claims are untimely. However, even if the applicable statute of limitations is two years, Defendants have failed to show that Enenstein's COBRA claims are untimely. Defendants have improperly presumed that the statute of limitations period would run from the date of the termination of Enenstein's employment.

Unless Congress has specified to the contrary, the accrual of statute of limitations for a violation of federal law is governed by the federal common law "discovery rule," which provides that the limitations period begins to run "not [always on] the date on which the wrong that injures the plaintiff occurs, . . . but sometimes" on a later date "on which the plaintiff discovers that he has been injured." Cada v. Baxter Healthcare Corp., 920 F.2d 446, 450-52 (7th Cir. 1990); see also In re Copper Antitrust Litigation, 436 F.3d 782, 789 (7th Cir. 2006)(stating that "in the absence of a contrary directive from Congress" a statute of limitations period is governed by the "discovery rule, which ...

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