“In determining whether a corporation is a fiduciary, rather than looking to the formal title, we use a functional approach, looking to whether it acts in a fiduciary capacity with respect to the conduct at issue.”
How later courts described this case
- “In determining whether a corporation is a fiduciary, rather than looking to the formal title, we use a functional approach, looking to whether it acts in a fiduciary capacity with respect to the conduct at issue.”
- “This Court’s jurisprudence on abandonment of claims is clear: a plaintiff is deemed to have abandoned a claim when a plaintiff fails to address it in response to a motion for summary judgment.”
Written by the judges who cited it.
The opinion
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
PATRICK IGO, individually and as : Case No. 1:22-cv-91
administrator of the ESTATE OF :
MARCOS ESTRADA GOMEZ, : Judge Timothy S. Black
:
Plaintiff, :
:
vs. :
:
SUN LIFE ASSURANCE COMPANY :
OF CANADA, et al., :
:
Defendants. :
ORDER:
(1) GRANTING MOTION FOR SUMMARY JUDGMENT (DOC. 36);
(2) GRANTING JOINT MOTION TO DISMISS (DOC. 40);
AND (3) TERMINATING CASE
This civil case is before the Court on Defendant Sagewell Healthcare Benefits
Trust (“Sagewell”) and Benefit Advisors Services Group (“BASG”)’s motion for
summary judgment (Doc. 36), Sagewell and BASG’s statement of proposed undisputed
facts (Doc. 37), and the parties’ responsive memoranda (Docs. 38, 39).1
I. BACKGROUND
A. Undisputed Material Facts
For purposes of Sagewell and BASG’s motion for summary judgment, the Court
finds the following facts are undisputed:
1 Also before the Court is Plaintiff and Defendant Sun Life Assurance Company of Canada
(“Sun Life”)’s joint motion to dismiss Sun Life. (Doc. 40). No party has opposed the motion
and the time for doing so has expired. Accordingly, Plaintiff’s claims against Sun Life are
DISMISSED with prejudice.
Sagewell is the named insured on health and accidental death and dismemberment
insurance policies that insurance companies issue to cover employees of various hospitals
and medical facilities. (Doc. 37 at ¶ 11). Relevant to this action, Sun Life issued a health
and accidental death and dismemberment policy (the “Policy”) in the name of Sagewell
to cover the employees of Bon Secours Mercy Health, Inc. (“Bon Secours”). (Id. at ¶ 12;
see also Doc. 3-3).
As the Policy’s holder, Sagewell contracted with BASG to act as Sagewell’s
administrator. (Id. at ¶ 16). Specifically, BASG’s role as administrator was taking the
gross premium—payments collected by Bon Secours from employees who opted to be
covered by the Policy—and forwarding the premiums from Bon Secours to Sun Life. (Id.
at ¶ 18). Neither Sagewell nor BASG determined the eligibility of Bon Secours
employees for benefits under the Policy. (Id. at ¶¶ 13, 19). And neither Sagewell nor
BASG determined the amount of benefits to be paid to Plaintiff pursuant to the Policy.
(Id. at ¶¶ 15, 21).
B. Other Facts and Allegations2
Dr. Marcos Estrada Gomez was an eligible employee under the Policy through his
employment with Bon Secours. (Doc. 3 at ¶ 18). In 2020, Dr. Estrada Gomez elected to
increase his benefits under the Policy from two times to five times his base annual salary,
and paid for the increase in benefits via deductions from his pay. (Id. at ¶¶ 21, 22). Dr.
2 The following are allegations from Plaintiff’s operative Amended Complaint. The facts are
immaterial to resolution of Sagewell and BASG’s motion for summary judgment, but helpful
when understanding the nature of action.
Estrada Gomez died on August 29, 2020, and his Estate was opened on January 13, 2022.
(Doc. 3-2).
After Dr. Estrada Gomez’s death, Plaintiff completed all necessary conditions to
receive benefits under the Policy; however, Plaintiff allegedly did not receive full
benefits. (Doc. 3 at ¶ 27). Specifically, Plaintiff was only paid two times Dr. Estrada
Gomez’s base salary ($535,000), instead of five times his base salary ($1,337,000). (Id.
at ¶¶ 29, 30). According to Plaintiff, Defendants denied Plaintiff’s claim for five times
the salary, stating that, when Dr. Estrada Gomez elected to increase his coverage, he
failed to provide an “evidence of insurability” form. (Id. at ¶ 32). Plaintiff maintains that
such form was not required when Dr. Estrada Gomez elected to increase his coverage.
(Id. at ¶ 34).
C. Procedural History
From these facts, Plaintiff initiated this action against Sagewell, BASG, Bon
Secours, and Sun Life. (See generally, id.) Plaintiff asserted the following counts against
all Defendants: (1) ERISA; (2) declaratory judgment pursuant to 28 U.S.C. § 2201;
(3) declaratory judgment under 42 Pa. C.S. § 7532; (4) breach of contract; (5) promissory
estoppel/detrimental reliance; (6) bad faith; (7) negligence per se; (8) negligent
misrepresentation; (9) concert of tortious action; and (10) punitive damages. (Id.)
Bon Secours and Plaintiff settled their claims. (Doc. 25). So, Bon Secours was
dismissed with prejudice. (Doc. 32). Sun Life and Plaintiff also settled their claims.
(Doc. 40). So, Sun Life was dismissed with prejudice. (Supra, n.1). Accordingly, the
counts, as alleged against Sagewell and BASG only, remain.
II. STANDARD OF REVIEW
A motion for summary judgment should be granted if the evidence submitted to
the Court demonstrates that there is no genuine issue as to any material fact, and that the
movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). See Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 247–48 (1986). The moving party has the burden of showing the absence of
genuine disputes over facts which, under the substantive law governing the issue, might
affect the outcome of the action. Celotex, 477 U.S. at 323. All facts and inferences must
be construed in a light most favorable to the party opposing the motion. Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
A party opposing a motion for summary judgment “may not rest upon the mere
allegations or denials of his pleading, but . . . must set forth specific facts showing that
there is a genuine issue for trial.” Anderson, 477 U.S. at 248.
III. ANALYSIS
Counts 1 and 2
In Count 1, Plaintiff asserts a claim under the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), 29 U.S.C. § 1001 et seq. (Doc. 3 at ¶ 39).
Specifically, Plaintiff seeks civil enforcement of his rights under the Policy. (Id.) In
Count 2, Plaintiff seeks a declaration that he is a beneficiary of an ERISA qualifying plan
and entitled to collect $802,000. (Doc. 3 at ¶ 41). Sagewell and BASG argue that
summary judgment is warranted on Counts 1 and 2 because Sagewell and BASG are not
fiduciaries with respect to the Policy. (Doc. 36 at 10).
ERISA exclusively regulates “any plan, fund, or program . . . maintained by an
employer . . . for the purpose of providing for its participants or their beneficiaries,
through the purchase of insurance or otherwise, medical ... benefits, or benefits in the
event of sickness . . . death . . .” 29 U.S.C. § 1002.1 (emphasis added). The parties agree
that ERISA governs the Policy. (E.g., Doc. 3 at ¶¶ 38-39; Doc. 36 at 9).
A fiduciary can be held liable for a breach of fiduciary duty under 29 U.S.C.
§ 1109(a). ERISA defines a fiduciary as a person who “exercises any discretionary
authority or discretionary control respecting management of such plan or any authority or
control respecting the management or disposition of assets.” 29 U.S.C. § 1002(21)(A)(i).
When a court is considering whether a defendant qualifies as a fiduciary under ERISA,
its “inquiry is a functional one, with the task being to determine whether [the defendant]
exercised discretionary authority over plan management, or any authority or control over
plan assets.” Briscoe v. Fine, 444 F.3d 478, 488 (6th Cir. 2006); see also Deschamps v.
Bridgestone Americas, Inc. Salaried Emps. Ret. Plan, 840 F.3d 267, 277 (6th Cir. 2016)
(“In determining whether a corporation is a fiduciary, rather than looking to the formal
title, we use a functional approach, looking to whether it acts in a fiduciary capacity with
respect to the conduct at issue.”). “Where the facts are not in question, a party’s status as
an ERISA fiduciary is purely a question of law.” Hamilton v. Carell, 243 F.3d 992, 997
(6th Cir. 2001).
Here, the undisputed facts show that Sagewell and BASG are not fiduciaries.
Although Sagewell was the named holder of the Policy, there are no facts suggesting that
Sagewell exercised any authority or control over the Policy particularly with respect to
the conduct at issue. Specifically, in this instance, there are no facts demonstrating that
Sagewell had anything to do with employee applications or elections for coverage under
the Policy, that Sagewell had anything to do with determining whether Bon Secours
employees were eligible to receive benefits under the Policy, or that Sagewell had
anything to do with determining benefits paid under the Policy. Thus, with respect to the
conduct at issue, Sagewell was not a fiduciary.
As to BASG, the undisputed material facts show that the only role BASG played
with respect to the Policy was transferring premiums, premiums that were already
collected by Bon Secours, from Bon Secours to Sun Life. And “[c]ustody of plan assets
alone cannot establish control sufficient to confer fiduciary status.” McLemore v.
Regions Bank, 682 F.3d 414, 423 (6th Cir. 2012). Thus, with respect to the conduct at
issue, BASG was not a fiduciary.
To be sure, Plaintiff argues that Policy’s language “makes it quite plausible that
Sagewell and/or BASG played some role in [the] discrepancy that led to the denial of
benefits.” (Doc. 38 at 4 (emphasis added)). Plaintiff cites to the Policy’s Clerical Error
provision, which provision suggests that Sagewell and BASG “may commit errors”
resulting in a breach of fiduciary duty. (Id. at 3-4 (citing Doc. 3-3 at 36) (emphasis
added)). In other words, Plaintiff argues that because Sagewell and BASG may have
been involved in the acts or omissions (whether Dr. Estrada Gomez needed, and was
informed that he needed, to submit an evidence of insurability form for coverage) leading
to the denial of Plaintiff’s claimed benefits (five times Dr. Estrada Gomez’s salary
instead of two), Sagewell and BASG should be deemed fiduciaries and liable for at least
part of Plaintiff’s damages. (Id.)
But, at this stage in the proceedings, Plaintiff cannot merely claim that it is
plausible that Sagewell and BASG were fiduciaries. When faced with evidence showing
that Sagewell and BASG were not fiduciaries, Plaintiff must set forth specific facts
showing that there is a genuine issue for trial. Anderson, 477 U.S. at 248. And Plaintiff
has not done so here. Plaintiff cites to no evidence tending to show how Sagewell and
BASG acted as fiduciaries with respect to the conduct at issue. Plaintiff cites to no
deposition testimony, affidavit or declaration, or other documentation, other than the
Policy itself. See Fed. R. Civ. P. 56(c), 56(e). Indeed, Plaintiff cited zero evidence when
responding to Sagewell and BASG’s undisputed facts. (Doc. 38-1).
As a final matter, under ERISA, a party may seek “appropriate equitable relief”
against a nonfiduciary. McLemore v. Regions Bank, 682 F.3d 414, 422 (6th Cir. 2012)
(citing 29 U.S.C. § 1132(a)(3)). And, in Count 2, Plaintiff seeks a declaration that he is a
beneficiary of an ERISA qualifying plan and that he is entitled to collect $802,000. (Doc.
3 at ¶ 41). However, although Plaintiff’s request is presented as equitable relief in part,
the Court finds that Plaintiff is only seeking money damages. Stated differently, there is
no dispute that Plaintiff was a beneficiary of an ERISA qualifying plan; Plaintiff was
already paid two times Dr. Estrada Gomez’s salary. The only dispute is the actual
amount of benefits owed to Plaintiff.
Accordingly, Sagwell and BASG’s motion for summary judgment on Counts 1
and 2 is GRANTED.
B. Remaining Counts
Sagewell and BASG move for summary judgment on Plaintiff’s remaining claims
(Counts 3 through 10). In response, Plaintiff “elects not to address the application of
state law claims and agrees to dismiss Counts III – X of the Complaint as to the Moving
Defendants.” (Doc. 38 at 9). See, e.g., Brown v. VHS of Michigan, Inc., 545 F. App’x
368, 372 (6th Cir. 2013) (“This Court’s jurisprudence on abandonment of claims is clear:
a plaintiff is deemed to have abandoned a claim when a plaintiff fails to address it in
response to a motion for summary judgment.”). Accordingly, Sagwell and BASG’s
motion for summary judgment on Counts 3 through 10 is GRANTED.
IV. CONCLUSION
Based upon the foregoing, Defendant Sagewell Healthcare Benefits Trust and
Benefit Advisors Services Group’s motion for summary judgment (Doc. 36) is
GRANTED. All counts against Sagewell Healthcare Benefits Trust and Benefit
Advisors Services Group are DISMISSED with prejudice. There being no defendants
remaining in the case, the Clerk shall enter judgment accordingly and close the case.
IT IS SO ORDERED.
Date: 9/5/2024 s/Timothy S. Black
Timothy S. Black
United States District Judge