United States District Court, E.D. Michigan, Southern Division
CHERYL L. WALLACE, Plaintiff,
BEAUMONT HEALTHCARE EMPLOYEE WELFARE BENEFIT PLAN f/k/a OAKWOOD HEALTHCARE, INC. EMPLOYEE WELFARE BENEFIT PLAN, HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY, and RELIANCE STANDARD LIFE INSURANCE CO., Defendants.
OPINION AND ORDER GRANTING IN PART AND DENYING IN
PART DEFENDANT RELIANCE STANDARD LIFE
INSURANCE COMPANY'S MOTION TO DISMISS PLAINTIFF'S
V. PARKER, U.S. DISTRICT JUDGE.
action brought pursuant to the Employee Retirement Income
Security Act of 1974 (“ERISA”), Plaintiff Cheryl
L. Wallace claims she was wrongfully denied long term
disability benefits and that one or more defendants engaged
in procedural due process violations and breached its
fiduciary duties while handling her long term disability
claim. Defendants are the Beaumont Healthcare Employee
Welfare Benefit Plan (f/k/a the Oakwood Healthcare, Inc.
Employee Welfare Benefit Plan) (“Plan”), Hartford
Life Insurance Company (“Hartford”), and Reliance
Standard Life Insurance Company (“Reliance”).
Presently before the Court is Reliance's motion to
dismiss Plaintiff's Amended Complaint. The parties have
fully briefed the motion. Finding the facts and legal
arguments sufficiently presented in the parties' briefs,
the Court is dispensing with oral argument pursuant to
Eastern District of Michigan Local Rule 7.1(f). For the
reasons that follow, the Court is granting Defendants'
summary judgment motion. For the reasons that follow, the
Court is granting in part and denying in part Reliance's
Standard for Motion to Dismiss
A motion to dismiss pursuant to Rule 12(b)(6) tests the legal
sufficiency of the complaint. RMI Titanium Co. v.
Westinghouse Elec. Corp., 78 F.3d 1125, 1134 (6th Cir.
1996). Under Federal Rule of Civil Procedure 8(a)(2), a
pleading must contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief.” To survive a motion to dismiss, a complaint
need not contain “detailed factual allegations, ”
but it must contain more than “labels and
conclusions” or “a formulaic recitation of the
elements of a cause of action . . ..” Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 555 (2007). A complaint
does not “suffice if it tenders ‘naked
assertions' devoid of ‘further factual
enhancement.' ” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at
Supreme Court provided in Iqbal and
Twombly, “[t]o survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.' ” Id. (quoting
Twombly, 550 U.S. at 570). “A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Id. (citing Twombly, 550 U.S. at 556). The
plausibility standard “does not impose a probability
requirement at the pleading stage; it simply calls for enough
facts to raise a reasonable expectation that discovery will
reveal evidence of illegal [conduct].”
Twombly, 550 U.S. at 556.
deciding whether the plaintiff has set forth a
“plausible” claim, the court must accept the
factual allegations in the complaint as true. Erickson v.
Pardus, 551 U.S. 89, 94 (2007). This presumption is not
applicable to legal conclusions, however. Iqbal, 556
U.S. at 668. Therefore, “[t]hreadbare recitals of the
elements of a cause of action, supported by mere conclusory
statements, do not suffice.” Id. (citing
Twombly, 550 U.S. at 555).
the court may not consider matters outside the pleadings when
deciding a Rule 12(b)(6) motion to dismiss. Weiner v.
Klais & Co., Inc., 108 F.3d 86, 88 (6th Cir. 1997)
(citing Hammond v. Baldwin, 866 F.2d 172, 175 (6th
Cir. 1989)). A court that considers such matters must first
convert the motion to dismiss to one for summary judgment.
See Fed. R. Civ. P 12(d). However, “[w]hen a
court is presented with a Rule 12(b)(6) motion, it may
consider the [c]omplaint and any exhibits attached thereto,
public records, items appearing in the record of the case and
exhibits attached to [the] defendant's motion to dismiss,
so long as they are referred to in the [c]omplaint and are
central to the claims contained therein.” Bassett
v. Nat'l Collegiate Athletic Ass'n, 528 F.3d
426, 430 (6th Cir. 2008).
Factual and Procedural Background
worked at Oakwood Healthcare, Inc. Health System
(“Oakwood”) as a registered nurse. (Am. Compl.
¶ 11, ECF No. 16.) Incident to her employment, Plaintiff
was a participant in the Oakwood Healthcare, Inc. Employee
Welfare Benefit Plan, which afforded long term disability
benefits to its eligible employees. (Id. ¶¶
4, 5.) Hartford served as the plan's insurer until
Oakwood cancelled its contract with Hartford, effective
January 1, 2013. (Id. ¶ 25.) On that date,
Reliance became the plan's insurer. (Id. ¶
interim, on October 8, 2012, Plaintiff stopped working at
Oakwood due to a serious and worsening health condition.
(Id. ¶ 11.) Plaintiff remained off work from
October 8, 2012 through April 7, 2013. (Id. ¶
27.) Plaintiff returned to work on April 7, 2013, but found
it necessary to take a medical leave of absence again
starting May 12, 2013. (Id. ¶¶ 28, 29.)
Plaintiff was not able to return to work thereafter.
(Id. ¶ 30.) Plaintiff therefore filed a claim
for long term disability benefits with Hartford and Reliance.
(Id. ¶ 31.)
denied Plaintiff's claim on the basis that she failed to
satisfy the eligibility requirements in Hartford's
insurance policy-- specifically the 180-day Elimination
Period. (Id. ¶ 32.) In making this
determination, Hartford maintained that Plaintiff's first
date of actual disability was October 12, 2012, rather than
October 8, 2012. (Id.)
denied Plaintiff's claim based on the pre-existing
condition exclusion in its contract. (Id. ¶
36.) Reliance maintained that, pursuant to the terms of its
insurance contract, Plaintiff did not become insured under
its group insurance policy until April 7, 2013, when she
returned to active work from her medical leave and then left
her employment again on May 21, 2013. (Pl.'s Resp., Ex.
5, ECF No. 25-6.) In its denial letter, Reliance informed
Plaintiff that she “may request a review” of its
determination by submitting a written request. (Id.,
Ex. 6, ECF No. 25-7.) The letter further advised in pertinent
The written request for review must be sent within 180 days
of your receipt of this letter. Your request should state any
reasons why you feel this determination is incorrect, and
should include any written comments, documents, records, or
other information relating to your claim for benefits. Only
one review will be allowed, and your request must be
submitted within 180 days of your receipt of this letter to
In the event that your claim is subject to the Employee
Retirement Income Security Act of 1974 (“the
Act”), you have the right to bring a civil action under
section 502(a) of the Act following an adverse benefit
determination on a review. Your failure to request a review
within 180 days of your receipt of this letter may constitute
a failure to exhaust administrative remedies ...