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Huss v. IBM Medical and Dental Plan

March 20, 2009


The opinion of the court was delivered by: Judge James B. Zagel


This is an ERISA suit to overturn the denial of enrollment eligibility for Joseph R. Huss, Jr., Eileen Huss's 25-year old mentally disabled son, in the employee welfare plan sponsored and administered by Eileen's former employer, IBM. Eileen Huss ("Huss") filed a four-count amended complaint under the Employee Retirement Income Security Act ("ERISA") against the IBM Medical and Dental Plan (the "Plan") and the Plan Administrator (collectively "IBM" or "Defendants"). Huss seeks relief in the form of health benefits due to her son pursuant to 29 U.S.C. § 1132(a)(1)(B) (Count I) and statutory damages from the Plan and the Plan Administrator for their failure to provide requested documents pursuant to 29 U.S.C. §§ 1024(b)(4) and 1132(c) (Count II). Specifically, Huss claims that the Plan incorrectly interpreted the eligibility requirements of the Over Age 23 Disabled Dependent Child provision set forth in the Plan and that the decision to deny Joseph's enrollment in the Plan was arbitrary, capricious, and unreasonable. Huss further claims that Defendants failed to produce certain documents that were critically important to a full and fair resolution of her and Joseph's rights. Count IV seeks attorneys' fees pursuant to 29 U.S.C. § 1132(g)(1). I dismissed Count III, Huss's claim for breach of fiduciary duty, on June 30, 2008. The parties now cross move for summary judgment on Counts I and II.

I. Facts

Plaintiff Eileen M. Huss ("Huss") is a retired International Business Machines Corporation ("IBM") employee and legal guardian for her disabled son, Joseph R. Huss, Jr. Defendant IBM Medical and Dental Plan ("IBM Plan" or the "Plan") is the legal entity through which IBM provides employee benefits to its active and retired employees. The benefits program offered by IBM is governed by the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan is designed to provide health, dental, and disability benefits to eligible employees of IBM. Defendant R.A. Barnes is the Plan Administrator for the IBM Plan, operating out of the Office of the Plan Administrator at the IBM Employee Services Center. In her capacity as Plan Administrator, Barnes has the sole discretion to make the final decision with respect to eligibility under the Plan:

The Plan Administrator has the sole discretion to make the final decision with respect to eligibility under the IBM Medical and Dental Plan. The decision will take into account any factors determined to be relevant within the intent of the Plan and consistent with the tax-qualified status of the Plan.

Eligible individuals will receive coverage under the IBM Medical and Dental Benefits Plan only if and while enrolled for coverage.

On December 31, 2006, Huss retired as an IBM employee after more than 30 years of service. During her employment and upon her retirement, Eileen was at all times material both a participant and a beneficiary under multiple iterations of the IBM Plan. Eileen's son, Joseph, was born on August 8, 1981. Since his birth, Joseph has suffered from a severe mental disability that renders him incapable of speech, and he has at all times been completely dependent upon his parents for his support and well-being. Joseph was enrolled in the IBM Plan from the date of his birth until December 31, 1997. Beginning on January 1, 1998, Joseph was enrolled in the employee benefit plan offered through his father's employer.

In late 2005, Huss made a phone call to the IBM Plan Customer Service Center. Huss spoke to a Customer Service Specialist ("CSS"), explained the details of Joseph's disabled and dependent status, and asked what steps were required to enroll Joseph in the Plan. The CSS told Huss there would be no problem enrolling Joseph in the Plan and suggested that Huss call again about six months prior to her retirement.

On January 16, 2006, Huss spoke with a different CSS who confirmed that any of her dependents listed as "contacts" in the Plan's system "could be added to her retiree benefit coverage." At the time, Huss had no contacts listed in the system.

On June 15, 2006, Huss called and spoke with another CSS and added Joseph as a contact on her benefits record. She again explained Joseph's status as a permanently disabled dependent and asked what she needed to do to ensure Joseph's enrollment in the Plan in the following annual open enrollment period. The CSS placed Huss on hold to verify if anything else needed to be done regarding adding dependents and then confirmed what the previous IBM Plan employee had told Huss -- that there was nothing for her to do until she was ready to add Joseph to the Plan.

On January 3, 2007 (just after Huss's retirement on December 31, 2006), another CSS, Todd Rogers, called Huss to confirm her pension and benefit elections. Rogers confirmed that Joseph was listed as a "contact," but he told Huss that the Plan would not permit Joseph to enroll because she was supposed to have submitted a written application at least 60 days prior to Joseph's attained age 23 -- on or before June 9, 2004 -- and that her failure to do so barred Joseph's enrollment in the Plan.

On January 5, 2007, Rogers called Huss again and confirmed that Joseph would not be permitted to enroll in the IBM Plan. When Huss told Rogers that a previous Plan employee had added Joseph as a "contact" and had told Huss she could enroll Joseph during the next open enrollment period, Rogers stated that although Joseph had been added as a "contact," a "special indicator for dependent" status in the IBM system had not been checked. Rogers advised Huss that the Plan had not received a written application within 60 days of Joseph's 23rd birthday. Rogers also indicated that the Plan had no reason to send a notification of the application requirement to Huss prior to Joseph's attaining age 23. However, if Joseph had been enrolled in the Plan when he was about to reach the age of 23, IBM would have sent a notification to Huss regarding the application requirement.

On January 8, 2007, Huss sent an email to Rogers requesting a copy of "the IBM summary plan," "the policy language for this benefit," and "[a]ny notices or instructions that may have been sent out on this benefit." Rogers responded the same day by saying there were no further documents other than the January 1, 2006 version of the Summary Plan Description ("SPD") that had already been sent to Huss.

On January 9, 2007, Rogers again spoke with Huss, confirmed he received her email request for documents, and explained that he would verify whether she needed any additional information beyond the January 1, 2006 SPD. On January 16, 2007, Rogers contacted Huss and advised that the January 1, 2006 SPD was the only document she needed for her appeal. Rogers sent Huss an email on January 17, 2007 confirming: "I have done some research with our back office to see if there is any additional documentation that you might have received or need to research your appeal. Our back office has informed me that there are no other mailing [sic] that we would have sent out to you. Also, their [sic] are no additional resources that you should need. The only document that we would send or that you should need is the [January 1, 2006 version of the] Summary Plan Document. I requested this document on 1/9/07."

On January 23, 2007, Huss emailed Rogers to confirm that she received the January 1, 2006 SPD. In her email, Huss also specifically requested the Plan language in effect in 2004, as "this is the date you advised that I would have had to notify IBM that my son is a dependent." In an email dated January 29, 2007, Rogers responded to Huss, "[u]nfortunately, there is no policy or contract information for us to send. Everything you should need to file your appeal would be included in the Summary Plan Description booklet you received."

On March 27, 2007, Huss's counsel sent an appeal letter to the Plan requesting the Plan Administrator to review the "determination concerning the eligibility of Joseph Robert Huss, Jr. to receive health insurance benefits as a dependent under the IBM Medical and Dental Plan." The appeal letter noted Huss's prior requests for all operative plan language, including the plan language from 2004, and made a new request for the following documents: "actual plan documents for IBM Medical and ...

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