# Greene

> District Court, N.D. Ohio · March 20, 2026

URL: https://www.frixlaw.com/law-library/cases/11309165

## Case

- **Full name:** Andrea D. Greene, et al. v. Progressive Corporation
- **Court:** District Court, N.D. Ohio
- **Decided:** March 20, 2026
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

ANDREA D. GREENE, et al., ) CASE NO. 1:24-cv-01890
)
Plaintiffs, ) JUDGE DAVID A. RUIZ
)
-vs- )
) MEMORANDUM OPINION AND ORDER
PROGRESSIVE CORPORATION, )
)
Defendant. )

Pending before the Court is the Motion to Dismiss filed by Defendant Progressive
Corporation (“Progressive”). (R. 13). Plaintiffs Andrea D. Greene and James M. Vaughan allege
they “are current and former employees who paid [a] tobacco surcharge and/or paid [a] vaccine
surcharge to maintain health insurance coverage” under the Progressive Health Life And Disability
Benefits Plan (the “Plan”). (R. 1, PageID# 2, ¶¶4-5). Plaintiffs allege five counts against Defendant:
(1) unlawful imposition of a discriminatory tobacco surcharge in violation of the Employee
Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1182; (2) unlawful imposition of a
discriminatory vaccine surcharge in violation of ERISA, 29 U.S.C. § 1182; (3) failure to notify of a
reasonable alternative standard for avoiding the tobacco surcharge in violation of 29 U.S.C. § 1182
and 29 C.F.R. § 2590.702; (4) failure to notify of a reasonable alternative standard for avoiding the
vaccine surcharge in violation of 29 U.S.C. § 1182 and 29 C.F.R. § 2590.702; and, (5) breach of
fiduciary duty in violation of ERISA, §§ 404 and 406, 29 U.S.C. §§ 1104 and 1106. (R. 1).
Progressive has moved to dismiss the Complaint under Federal Rule of Civil Procedure
12(b)(6) for failure to state a claim, as well as under Federal Rule of Civil Procedure (12)(b)(1) for
la ck of subject-matter jurisdiction. (R. 13). The latter argument suggests Plaintiffs have not plausibly
alleged an injury in fact and lack standing. (R. 13, PageID# 79-85).1 Plaintiffs have opposed said
motion (R. 14), and Defendant has filed a reply supporting its motion. (R. 16).
For the following reasons, the Court GRANTS Defendant Progressive’s Motion to Dismiss
this case for failure to state a claim.
I. Background
A. Wellness Programs Under ERISA
Under ERISA, “[a] group health plan, and a health insurance issuer offering health insurance
coverage in connection with a group health plan, may not require any individual (as a condition of
enrollment or continued enrollment under the plan) to pay a premium or contribution which is
greater than such premium or contribution for a similarly situated individual enrolled in the plan on
the basis of any health status-related factor in relation to the individual or to an individual enrolled
under the plan as a dependent of the individual.” 29 U.S.C. § 1182(b)(1).
Nevertheless, the very next subsection of ERISA clarifies that:

Nothing in paragraph (1) shall be construed--

***

(B) to prevent a group health plan, and a health insurance issuer offering group
health insurance coverage, from establishing premium discounts or rebates or
modifying otherwise applicable copayments or deductibles in return for adherence
to programs of health promotion and disease prevention.

29 U.S.C.A. § 1182(b)(2). Further, the Affordable Care Act (“ACA”) amended ERISA, making
certain provisions of the Public Health Service Act (“PHSA”) applicable to wellness programs. See

1 Defendant’s motion attaches “The Progressive Health Life And Disability Benefits Plan: Summary
Plan Description” (“SPD”) referenced in the Complaint. (R. 13-1).
29 U.S.C.A. § 1185d(a) (“the provisions of part A … of the Public Health Service Act (as amended
by the Patient Protection and Affordable Care Act) shall apply to group health plans, and health
insurance issuers providing health insurance coverage in connection with group health plans, as if
included in this subpart….”) These programs are referred to in the statute as “wellness programs.”
42 U.S.C. § 300gg-4(j). Furthermore, the absence of a surcharge is expressly contemplated as a
possible “reward” under the statute. 42 U.S.C. § 300gg-4(j)(3)(A) (“A reward may be in the form
of a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing
mechanism (such as deductibles, copayments, or coinsurance), the absence of a surcharge, or the
value of a benefit that would otherwise not be provided under the plan.”) (emphasis added).
In 2013, the Department of Labor (“DOL”) incorporated these requirements into its
regulations for non-discriminatory wellness programs. Incentives for
Nondiscriminatory Wellness Programs in Group Health Plans, 78 Fed. Reg. 33158,
33181–86 (June 3, 2013) (codified at 29 C.F.R. § 2590.702). In issuing these revised
regulations, the DOL specified its intent that “every individual participating in [a
wellness] program should be able to receive the full amount of any reward or
incentive, regardless of any health factor.” Id. at 33160.

Under the applicable regulatory scheme, outcome-based wellness programs, such as
tobacco cessation programs, must satisfy five conditions. First, participants must
receive at least one opportunity per year to qualify for the reward. 29 C.F.R. §
2590.702(f)(4)(i). Second, the reward must not exceed a specified percentage of the
“cost of employee-only coverage under the plan.” Id. § 2590.702(f)(4)(ii); see id. §
2590.702(f)(5) (defining the relevant percentage for tobacco-reduction programs as
fifty percent). Third, the program “must be reasonably designed to promote health or
prevent disease.” Id. § 2590.702(f)(4)(iii). This provision requires that a program
have a “reasonable chance of improving the health of, or preventing disease in,
participating individuals,” not be “overly burdensome” and not act as “subterfuge for
discriminating based on a health factor.” Id.

Fourth, “[t]he full reward ... must be available to all similarly situated individuals,”
requiring a “reasonable alternative standard ... for any individual who does not meet
the initial standard.” Id. § 2590.702(f)(4)(iv)(A). In determining whether a plan
furnishes a reasonable alternative standard, “[a]ll the facts and circumstances are
taken into account,” including the time commitment and cost for program completion.
Id. § 2590.702(f)(4)(iv)(C). The plan must also accommodate the recommendations
of an individual’s personal physician if that physician deems a plan standard “not
medically appropriate for that individual.” Id. Lastly, the plan must “disclose in all
plan materials describing the terms of an outcome-based wellness program ... the
availability of a reasonable alternative standard.” Id. § 2590.702(f)(4)(v). This
disclosure must include “contact information for obtaining a reasonable alternative
standard and a statement that recommendations of an individual’s personal physician
will be accommodated.” Id. However, “[i]f plan materials merely mention that such a
program is available, without describing its terms, this disclosure is not required.” Id.
The regulations provide illustrative examples of programs that either satisfy or fail to
meet these standards. Id. § 2590.702(f)(4)(vi).

Bokma v. Performance Food Grp., Inc., 783 F. Supp. 3d 882, 888 (E.D. Va. 2025).
Here, it is the fourth and fifth conditions that appear to be primarily in dispute. The fourth
condition requires that the “full reward” be available to all “similarly situated individuals,” and that
any individual who does not meet the initial standard for the reward must be given a “reasonable
alternative standard” for obtaining said reward. 29 C.F.R. § 2590.702(f)(4)(iv). Plans are “not
required to determine a particular reasonable alternative standard in advance of an individual’s
request for one … [but] a reasonable alternative standard must be furnished by the plan or issuer
upon the individual’s request or the condition for obtaining the reward must be waived.” 29 C.F.R. §
2590.702(f)(4)(iv)(B). Nevertheless, the fifth condition requires adequate notice of the availability
of the reasonable alternative standard:
Notice of availability of reasonable alternative standard. The plan or issuer must
disclose in all plan materials describing the terms of an outcome-based wellness
program, and in any disclosure that an individual did not satisfy an initial outcome-
based standard, the availability of a reasonable alternative standard to qualify for the
reward (and, if applicable, the possibility of waiver of the otherwise applicable
standard), including contact information for obtaining a reasonable alternative
standard and a statement that recommendations of an individual’s personal physician
will be accommodated. If plan materials merely mention that such a program is
available, without describing its terms, this disclosure is not required. Sample
language is provided in paragraph (f)(6) of this section, as well as in certain examples
of this section.

29 C.F.R. § 2590.702(f)(4)(v) (emphasis added). The DOL’s “sample language” referenced in the
above regulation provides the following example as adequate for satisfying the notice requirement:
Sample language. The following language, or substantially similar language, can be
used to satisfy the notice requirement of paragraphs (f)(3)(v) or (f)(4)(v) of this
section: “Your health plan is committed to helping you achieve your best health.
Rewards for participating in a wellness program are available to all employees. If you
think you might be unable to meet a standard for a reward under this wellness
program, you might qualify for an opportunity to earn the same reward by different
means. Contact us at [insert contact information] and we will work with you (and, if
you wish, with your doctor) to find a wellness program with the same reward that is
right for you in light of your health status.”

Id. § 2590.702(f)(6).
B. Fiduciary Duties Under ERISA
ERISA states that “a fiduciary shall discharge his duties with respect to a plan solely in the
interest of the participants and beneficiaries,” and “for the exclusive purpose of: (i) providing
benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of
administering the plan.” 29 U.S.C. § 1104(a)(1)(A)(i)-(ii). Fiduciary status under ERISA “is not an
all or nothing concept” and courts should ask whether a defendant “was acting as a fiduciary (that is,
was performing a fiduciary function) when taking the action subject to complaint[.]” Tiara Yachts,
Inc. v. Blue Cross Blue Shield of Michigan, 138 F.4th 457, 463 (6th Cir. 2025) (quoting Pegram v.
Herdrich, 530 U.S. 211, 226 (2000)). ERISA describes a fiduciary as one who “exercises any
discretionary authority or discretionary control respecting management of such plan or exercises any
authority or control respecting management or disposition of its assets” or “has any discretionary
authority or discretionary responsibility in the administration of such plan.” 29 U.S.C. §
1002(21)(A). Specifically, 29 U.S.C. § 1106(a)(1) prohibits certain categories of transactions
between the plan and a party in interest, while § 1106(b)(1) prohibits fiduciaries from “deal[ing]
with the assets of the plan in his own interest or for his own account.” Pursuant to 29 U.S.C. §
1132(a)(2), a participant in an ERISA plan is permitted to bring a civil action alleging liability for
breach of a fiduciary duty under 29 U.S.C. § 1109 (“Liability for breach of fiduciary duty”).
C . Factual Background
The basic facts of this case are not highly controverted. Plaintiff Vaughan was a former
employee of Defendant Progressive while Plaintiff Greene remained an employee of Progressive, at
least as of the time the Complaint was filed. (R. 1, PageID# 3, ¶¶7-8). Progressive sponsors the Plan,
which includes a wellness program for Plan participants who are employees2 of Progressive or one
of its affiliates. (R. 1, ¶¶11, 17, 19; R. 13, PageID# 73). Under the wellness program, participants
who are tobacco-free or receive the COVID-19 vaccine (during 2022 only) pay lower health
insurance premiums. Tobacco-free participants pay $15 less per pay period for their health insurance
than tobacco users and those who received the COVID vaccine paid $25 less per pay period in 2022.
Id. Plaintiffs characterize these amounts as surcharges on tobacco users and those who opted against
the vaccine. (R. 1, ¶¶18-19). The Complaint does not allege that Plaintiff Vaughan ever stopped
smoking or completed an alternative wellness program, or that Greene was ever vaccinated against
COVID. (See generally R. 1).3
Plaintiff Vaughan is a former employee of Progressive who paid the tobacco surcharge in

connection with the health insurance offered through Progressive. (R. 1, PageID# 3, ¶8). According
to the Complaint, “any employee who used tobacco products was required to identify themselves as
tobacco users and denied a non-tobacco use supplement. The supplement of roughly $15.00 per pay
period totaled roughly $390.00 annually. In addition, tobacco users were charged higher amounts for

2 Defendant points to language in the Plan, quoted in the Complaint, that suggests legal spouses and
children under the age of twenty-six (subject to certain exceptions) are eligible to participate in the
Plan, but that the non-tobacco discount is only offered to employees and, therefore, only employees
are “participants.” (R. 1, PageID# 7, ¶25; R. 13, PageID# 73, n. 1).
3 Based on these allegations, or lack thereof, Defendant’s take the position that these Plaintiffs lack
standing to seek reimbursement for individuals who stopped smoking or who became vaccinated at
some point during 2022. (R. 13, PageID# 74).
op tional life insurance. Throughout his employment at Progressive, Mr. Vaughn was effectively
charged for his tobacco use.” Id. at ¶17. The Complaint alleges that Progressive deposits the tobacco
surcharges into its own accounts, and that Defendant thereby has dealt with assets of the Plan in its
own interests, in violation of ERISA.
II. Applicable Standards
A. Standard of Review
1. Fed. R. Civ. P. 12(b)(6)
As the Supreme Court made clear, “to survive a [12(b)(6)] motion to dismiss, a complaint
must contain sufficient fact[s], accepted as true, to ‘state a claim to relief that is plausible on its
face.’” See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)).
A court faced with a Rule 12(b)(6) motion “must consider the complaint in its entirety,”
construing all factual allegations in a light most favorable to the plaintiff. Tellabs, Inc. v. Makor
Issues & Rts., Ltd., 551 U.S. 308, 322 (2007); Erickson v. Pardus, 551 U.S. 89, 93-94 (2007) (per

curiam); accord Streater v. Cox, 336 F. App’x 470, 474 (6th Cir. 2009). Consequently, a claim is
plausible on its face “when the plaintiff pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft at 678. This
“plausibility standard is not akin to a ‘probability requirement,’” but it demands “more than a sheer
possibility that a defendant has acted unlawfully.” Id.
2. Fed. R. Civ. P. 12(b)(1)
By including an argument for dismissal under Rule 12(b)(1), Defendant also challenges the
Court’s subject-matter jurisdiction. Unlike state trial courts, district courts do not have general
jurisdiction to review all questions of law. See Ohio ex rel. Skaggs v. Brunner, 549 F.3d 468, 474
(6 th Cir. 2008) (per curiam). Instead, federal courts have only the authority to decide cases that the
U.S. Constitution and Congress have empowered them to resolve. Id. Consequently, “[i]t is to be
presumed that a cause lies outside this limited jurisdiction, and the burden of establishing the
contrary rests upon the party asserting jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511
U.S. 375, 377 (1994) (internal citation omitted).
Rule 12(b)(1) motions may challenge jurisdiction facially or factually. United States v.
Richie, 15 F.3d 592, 598 (6th Cir. 1994). Facial attacks challenge jurisdiction based on the four
corners of a complaint. See In re Title Ins. Antitrust Cases, 702 F. Supp. 2d 840, 884-85 (N.D. Ohio
2010) (Lioi, J.) (citing United States v. Ritchie, 15 F.3d 592, 598 (6th Cir. 1994)). Factual attacks use
extrinsic evidence to support dismissal. Id. at 885 (citing Ohio Hosp. Ass'n v. Shalala, 978 F. Supp.
735, 739 (N.D. Ohio. 1997) (O’Malley, J.)). In either instance, when subject matter jurisdiction is
challenged under Rule 12(b)(1), the plaintiff has the burden of proving jurisdiction in order to
survive the motion. Madison-Hughes v. Shalala, 80 F.3d 1121, 1130 (6th Cir. 1996).
III. Analysis

A. Counts One through Four: Claims for Unlawful Imposition of a Discriminatory
Tobacco and Vaccine Surcharge

Plaintiffs claim that Progressive’s tobacco and COVID vaccine wellness programs violate
ERISA’s antidiscrimination provision, codified in 29 U.S.C. § 1182(b)(1), because they allegedly do
not satisfy the criteria for a wellness program. (R. 1, PageID# 4, ¶¶15-17). Generally, the Complaint
identifies two alleged statutory shortcomings in the wellness programs. First, they allege that ERISA
requires that Plan participants receive the “full reward” once they meet the alternative standard,
which they construe as avoiding the tobacco and vaccine surcharges for the full plan year. (R. 1,
PageID# 6-10). In other words, they allege the lack of a retroactive refund of the surcharges render
th e wellness programs non-compliant with ERISA. Id. Second, Plaintiffs allege that the Plan
materials failed to comply with ERISA’s notice requirements regarding the availability of reasonable
alternative standards for the reward/removal of the surcharge. (R. 1, PageID# 10-11). Therefore,
Plaintiffs assert that the Plan’s wellness programs do not meet statutory requirements and, therefore,
impermissibly discriminates against Plaintiffs and others similarly situated.
Defendant Progressive disagrees with the proposition that its wellness programs, related to
either tobacco cessation or the COVID vaccine, failed to comply with statutory standards. (See
generally R. 13 & 16). Defendants challenge Plaintiffs’ claim that language in the preamble to the
DOL’s regulations requires the Plan to reimburse all higher premiums paid during a calendar year.
(R. 13, PageID# 74).4 Defendant contends such a requirement appears nowhere in the ERISA statute
itself, and is tantamount to rewriting the statute. Id. at PageID# 75. Defendant further asserts that it
fully complied with ERISA’s notice requirements, and avers the Plan’s language tracks samples of
acceptable language from DOL’s sample disclosure. (R. 13, PageID# 89; R. 16, PageID# 212). The
Court addresses each of these arguments but in reverse order.

1. Notice of Reasonable Alternative Standard
Plaintiffs claim that the Plan failed to comply with ERISA’s notice requirements regarding
the availability of a “reasonable alternative standard” to either the tobacco cessation program or the
vaccination program. (R. 1, PageID# 10-11). Plaintiffs maintain that DOL “regulations require plans
and issuers to ‘disclose in all plan materials describing the terms of an outcome-based wellness
program, and in any disclosure that an individual did not satisfy an initial outcome-based standard,

4 The Court agrees with Defendant that Plaintiff’s construction would require a Plan administrator to
reimburse all higher premiums paid during a calendar year even if a participant stops smoking or
becomes vaccinated on the very last day of the year, a concept that does not appear in any actual
statute cited by Plaintiffs. (R. 13, PageID# 74-75).
th e availability of a reasonable alternative standard to qualify for the reward (and, if applicable, the
possibility of waiver of the otherwise applicable standard), including contact information for
obtaining a reasonable alternative standard and a statement that recommendations of an individual’s
personal physician will be accommodated.” (R. 1, PageID# 10, ¶33, citing 29 C.F.R. §
2590.702(f)(3)(v) (emphasis added)). The Complaint asserts that “[u]pon information and belief,
Defendant does not include adequate notification of the surcharges and the corresponding reasonable
alternative standards in all Plan materials” but concedes that “certain materials mention the vaccine
surcharge” but do not mention a reasonable alternative standard for the vaccination program or
tobacco cessation program. Id. at ¶34. Thus, it is Plaintiff’s position that Defendant’s failure to
provide adequate notice deprived them of the opportunity to avoid or reduce the tobacco and vaccine
surcharges. Id. at ¶¶3436.
The Complaint’s assertion that the Plan does not provide adequate notice is not a factual
allegation but a legal conclusion. Conversely, Defendant points to the following language in the SPD
as evidence of legally adequate notice:

Non-tobacco Use Discount
The Progressive medical plan includes a biweekly discount for not using tobacco.
You are considered a tobacco user if you habitually/regularly use tobacco in any
form, including, but not limited to: cigarettes (including electronic cigarettes/vaping),
pipes, cigars, chewing tobacco and snuff. Certification of tobacco use status is made
when making your benefits elections. If you quit tobacco use at any point during the
year, you must remain tobacco-free for twelve months to be considered a non-tobacco
user. At that time, you will become eligible to receive a biweekly discount.

COVID-19 Unvaccinated Surcharge
The Progressive medical plan includes a biweekly premium surcharge for those who
are not fully vaccinated (per current CDC guidelines) against COVID-19 (subject to
certain medical or religious exemptions).

Legal Notice Regarding Wellness Programs
We are committed to helping you achieve your best health. Rewards for participating
in our wellness program are available to all employees. If you think you might be
unable to meet a standard for a reward under this wellness program, you might
qualify for an opportunity to earn the same discount by different means. Contact the
HR Service Center at 800-692-4772 and we will work with you (and, if you wish,
your doctor) to find a wellness program with the same reward that is right for you in
light of your health status.

R. 13, PageID# 89 (citing R. 13-1. PageID# 111, SPD at 13). Progressive asserts that the Plan’s
description of the wellness program is substantially similar to the DOL’s sample notice language,
including by referencing the option of working with a participant’s doctor to find an appropriate
wellness program. (R. 13, PageID# 89, citing 29 C.F.R. § 2590.702(F)(6)).
The Court agrees with Progressive that the above “Legal Notice” in the SPD complies with
the statutory and regulatory notice requirements as a matter of law. Specifically, the Court agrees
that the description of the wellness program substantively matches the sample language—nearly
verbatim—provided by the DOL in 29 C.F.R. § 2590.702(f)(6) (quoted above in Section I - A).
Therefore, Plaintiff’s conclusory allegation — that the Plan does not include “adequate notification”
under the law — is untenable.
Progressive further takes issue with the Complaint’s allegation that the Plan fails to
adequately disclose information regarding a reasonable alternative standard. Progressive asserts that
the disclosures in the Plan are sufficient because they do not describe the terms of the wellness
program and, therefore, are not required to discuss the terms of the reasonable alternative standard.
(R. 16, PageID# 225). Indeed, 42 U.S.C. § 300gg-4(j)(3)(E) explicitly states that “The plan or issuer
involved shall disclose in all plan materials describing the terms of the wellness program the
availability of a reasonable alternative standard (or the possibility of waiver of the otherwise
applicable standard) required under subparagraph (D). If plan materials disclose that such a
program is available, without describing its terms, the disclosure under this subparagraph
sh all not be required.” (Emphasis added).5 While Plaintiffs take issue with Defendant’s argument
that ERISA does not require disclosure of a compliant alternative standard, and assert it is incorrect,
Plaintiffs fail to address the unambiguous statutory and regulatory language. That language confirms
that disclosure of the terms of alternative programs is not required when the plan materials disclose
the availability of a wellness program without describing its terms, as is the case herein.
The Complaint alleges, based on information and belief, that other plan materials do not
adequately identify the availability of a reasonable alternative standard (R. 1, ¶35) and Plaintiffs
argue that “Defendant cannot selectively disclose this information in one document [the SPD] while
omitting it from others.” (R. 14, PageID# 196). “While pleading on information and belief cannot
insulate a plaintiff at the 12(b)(6) stage,” Mod. Holdings, LLC v. Corning Inc., 2015 WL 1481457, at
*4 (E.D. Ky. Mar. 31, 2015), Iqbal did not render pleading on information and belief entirely
ineffectual. See, e.g., Arista Records, LLC v. Doe, 604 F.3d 110, 120 (2d Cir. 2010) “The Twombly
plausibility standard, which applies to all civil actions, does not prevent a plaintiff from pleading
facts alleged upon information and belief where the facts are peculiarly within the possession and

control of the defendant....” Id.; see also In re Darvocet, Darvon, & Propoxyphene Prods. Liab.
Litig., 756 F.3d 917, 931 (6th Cir. 2014) (“The mere fact that someone believes something to be true
does not create a plausible inference that it is true.”)
In 16630 Southfield Ltd. P'ship v. Flagstar Bank, F.S.B., 727 F.3d 502 (6th Cir. 2013), the
Sixth Circuit affirmed that a complaint lacked plausible factual allegations where an individual
alleged that he suffered ethnic origin discrimination and that, “upon information and belief,” other
similarly situated borrowers were treated more favorably. The Sixth Circuit explained that “[t]hese

5 See also 29 C.F.R. § 2590.702(f)(4)(v) (“If plan materials merely mention that such a program is
available, without describing its terms, this disclosure is not required.”)
ar e precisely the kinds of conclusory allegations that Iqbal and Twombly condemned and thus told us
to ignore when evaluating a complaint’s sufficiency…. the plaintiffs have not identified any
similarly situated individuals whom Flagstar treated better. They have merely alleged their ‘belief’
that such people exist. These ‘naked assertions devoid of further factual enhancement’ contribute
nothing to the sufficiency of the complaint.” Id. Similarly, Plaintiffs’ allegation that plan materials
that run afoul of ERISA’s disclosure requirements must exist, is a naked assertion devoid of fact.
This is not a case where the documents are peculiarly within the possession and control of
Progressive, as the other germane plan materials, if they exist, would not be Progressive’s internal
documents but rather documents that are disseminated to the public or at least to potential plan
participants. Plaintiffs’ inability to identify a single such document reveals their pleading to be little
more than speculation.
A recent decision confronting nearly identical facts, found that Plaintiffs’ allegation—that
other, unidentified plan materials did not uniformly contain the required notice—was “too vague to
state a claim ….” Noel v. Pepsico, Inc. & Pepsico Admin. Comm., No. 24-CV-7516 (CS), 2026 U.S.

Dist. LEXIS 41586, at **39-40 (S.D.N.Y. Feb. 27, 2026). There, the court aptly determined “the
problem … is that [plaintiff] has not identified any communication that did not provide such notice.
And there does not appear to be any reason that Plaintiff could not have examined employee-facing
documents such as ‘enrollment guides, benefits summaries, and online portals’”. Id.
In sum, the Court finds that the Plan includes the mandated notice requirements under 29
C.F.R. § 2590.702(f)(4)(v) and 42 U.S.C. § 300gg-4(j)(3)(E) as a matter of law. Therefore,
Plaintiff’s argument, that adequate notice of the wellness programs is lacking, is not well taken.
2. Failure to Provide the “Full Reward”
Plaintiffs also allege that the tobacco surcharge program does not provide for retroactive
re imbursement. (R. 1, ¶25). The Plan states that “[i]f you quit tobacco use at any point during the
year, you must remain tobacco-free for twelve months to be considered a non-tobacco user. At that
time, you will become eligible to receive a biweekly discount.” (R. 13-1, PageID# 111). Thus,
Plaintiffs’ contention that an individual who quit tobacco use would not be eligible for a retroactive
reimbursement is accurate—a point Defendant does not appear to dispute. According to Plaintiffs,
failure to provide retroactive reimbursement and the need to stay tobacco-free for 12 months directly
violates ERISA’s requirement to provide the “full reward” to all similarly situated individuals. Id.
¶¶21-32. The same assertions are raised with respect to the vaccination program—that an “employee
who vaccinated part way through the year would not be eligible to avoid the surcharges he or she
had already paid prior to submitting documentation” and would, thus be deprived of a “full reward.”
(R. 1, PageID# 9, ¶30).
Defendant argues that such claims fail as a matter of law because “Plaintiffs’ retroactive
reimbursement argument cannot be squared with the terms of the statute.” (R. 13, PageID# 86)
(“nothing in ERISA’s statutory language requires the Plan to reward Participants retroactively for

periods when they were non-adherent to a wellness program.”) (emphasis added).
The dispositive issue here is which side is correct as to the proper meaning of the term “full
reward,” and resolution of this issue does not involve any weighing of facts but is rather an issue of
statutory interpretation that can be resolved as a matter of law. If Defendant’s position prevails—that
a “full reward” does not require retroactive reimbursement to Plan participants who complete the
wellness program (or a reasonable alternative standard), then it is irrelevant whether Defendant did,
in fact, provide retroactive reimbursement to participants.
Under 42 U.S.C. § 300gg-4(j)(3)(D), “[t]he full reward under the wellness program shall be
made available to all similarly situated individuals,” but the term “full reward” is not defined.
L ikewise, 29 C.F.R. § 2590.702(f)(4)(iv) uses similar terminology without a clear definition.
“Neither ERISA nor the regulations implemented pursuant to it clearly define the term full reward.”
Noel, 2026 U.S. Dist. LEXIS 41586, at *30 (internal quotation marks and citations omitted).
Plaintiffs contend that full reward requires retroactive reimbursement of surcharges for the entire
calendar year. (R. 14, PageID# 183).
Plaintiffs argue that Congress delegated authority to the DOL to define and implement
ERISA’s anti-discrimination provisions, which they assert made clear that “full reward” means the
same reward as non-smokers enjoy. (R. 14, PageID# 194). Plaintiffs argue that Courts must defer to
agency interpretations unless they are clearly erroneous. Id. (citing Auer v. Robbins, 519 U.S. 452
(1997); Kisor v. Wilkie, 139 S. Ct. 2400 (2019)). Under Auer, a court must defer to an agency’s
interpretation of its own regulations unless that interpretation is “plainly erroneous or inconsistent
with the regulation.” 519 U.S. at 461. Plaintiffs’ argument relies on the preamble to the DOL’s
ERISA regulations, as have other plaintiffs who have filed similar lawsuits. The preamble states the
following:

[W]hile an individual may take some time to request, establish, and satisfy a
reasonable alternative standard, the same, full reward must be provided to that
individual as is provided to individuals who meet the initial standard for that plan
year. (For example, if a calendar year plan offers a health-contingent wellness
program with a premium discount and an individual who qualifies for a reasonable
alternative standard satisfies that alternative on April 1, the plan or issuer must
provide the premium discounts for January, February, and March to that individual.)

78 Fed. Reg. 33158, 33163. Plaintiffs, however, concede that “it is true that a preamble is not legally
binding,” but posit that courts routinely look to preamble language as “persuasive authority when it
clarifies an agency’s interpretation of its own regulations.” (R. 14, PageID# 195). For further
support, Plaintiffs cite a DOL enforcement action in Sec'y of Labor v. Macy's, Inc., No. 1:17-CV-
541, 2021 U.S. Dist. LEXIS 221603, 2021 WL 5359769 (S.D. Ohio Nov. 17, 2021). (R. 14, PageID#
19 3).6
An identical argument was recently address by the United States District Court for the
District of Rhode Island, which rejected Plaintiffs’ line of argument as follows:
According to [the plaintiff], this case “is a textbook example” of where Auer
deference should apply. (ECF No. 13 at 28.) Other courts that have considered similar
claims addressing the meaning of “full reward” have found Auer deference to
mandate acceptance of the preamble language as controlling. See Mehlberg v.
Compass Grp. USA, Inc., No. 24-CV-04179-SRB, 2025 U.S. Dist. LEXIS 84589,
2025 WL 1260700, at *5 (W.D. Mo. Apr. 15, 2025) (citing Auer, 519 U.S. at 461
1997); Bokma v. Performance Food Group, Inc., 783 F. Supp. 3d 882, 906 (E.D. Va.
2025) (finding Mehlberg persuasive regarding the applicability of Auer deference to
substantively similar tobacco surcharge claims).

However, another court confronted with similar claims noted, in dicta, that Mehlberg
and Bokma did not address a problem with applying Auer deference in this case: the
“anti-parroting doctrine.” See Buescher v. N. Am. Lighting, Inc., No. 24-CV-2076,
2025 U.S. Dist. LEXIS 135992, 2025 WL 1927503, at *26 (C.D. Ill. June 30, 2025).
Under Gonzalez v. Oregon, a court need not defer to an agency’s interpretation of a
parroting regulation because “[a]n agency does not acquire special authority to
interpret its own words when, instead of using its expertise and experience to
formulate a regulation, it has elected merely to paraphrase the statutory language.”
546 U.S. 243, 257, 126 S. Ct. 904, 163 L. Ed. 2d 748 (2006). While Bokma and
Mehlberg deferred to the preamble in deciding when the disclosure requirements
were triggered, those courts do not appear to have considered whether the anti-
parroting doctrine might be implicated. See Bokma 783 F. Supp. 3d at 906-07;
Mehlberg, 2025 U.S. Dist. LEXIS 84589, 2025 WL 1260700, at *5-6.

The First Circuit confronted a similar issue involving Auer deference and the anti-
parroting doctrine in Sun Capital Partners III, LP v. New England Teamsters &
Trucking Industry Pension Fund, 724 F.3d 129 (1st Cir. 2013). In that case, the
federal Pension Benefit Guaranty Corporation (“PBGC”) claimed that its
interpretation—provided in an appeals letter that was not subject to notice and
comment—should be afforded Auer deference regarding its definition of the term
“trade or business” as provided in 29 C.F.R. §§ 4001.2, 4001.3. Id. at 140. The court
disagreed for two reasons, one of which was that the regulations being interpreted
“made no effort to define ‘trades or businesses’ and merely refer to Treasury
regulations, which . . . also do not define the phrase.” Id. at 141 (internal citation
omitted). As those regulations were found to simply parrot the phrase “trade or
business” contained in 29 U.S.C. § 1301(b)(1), the court found Auer deference

6 In Macy’s, the DOL argued that the plain language of the regulations requires reimbursement of a
tobacco surcharge for the entire plan year. 2021 WL 5359769, at *13.
inapplicable under the anti-parroting doctrine. Id.

Here, as identified in Buescher, 29 C.F.R. § 2590.702(f)(4)(iv) simply repeats the
statutory “full reward” requirement found in 42 U.S.C. § 300gg-4(j)(3)(D). Bally’s
Management thus argues that the anti-parroting doctrine applies and precludes
mandatory deference to the Departments’ interpretation of the regulation. (ECF No.
11 at 25.) While [the plaintiff] disagrees with Bally’s argument, contending it
“ignores how administrative law actually works,” she fails to address how Gonzalez
v. Oregon and Sun Capital Partners are inapplicable. See ECF No. 13.

Another recent tobacco surcharge case further complicates this issue. See Waggoner
v. The Carle Found., Case No. 24-CV-2217, ECF No. 27 (C.D. Ill. Sept. 16, 2025). In
Waggoner, when faced with the challenge to Bokma and Mehlberg presented by
Buescher, the court noted the plaintiff’s argument that the phrase “full reward” in fact
originates from the Department of Labor’s 2006 wellness program regulations, which
used language that was adopted “almost verbatim” into ERISA through the
Affordable Care Act. Id. at *45-46; see Nondiscrimination and Wellness Programs in
Health Coverage in the Group Market, 71 Fed. Reg. 75014 (Dec. 13, 2006). Thus, the
plaintiffs argued, the court ought to defer to the Department of Labor’s interpretation
of its own regulation that was subsequently adopted by Congress. Waggoner, at *45-
46. Waggoner did not, however, decide whether this argument warranted Auer
deference, as it found that even were it not required to it would still follow the
Departments’ interpretation. [FN 5]

[FN 5] The court in Waggoner also noted the potential impact of Loper
Bright, 603 U.S. 369, 144 S. Ct. 2244, 219 L. Ed. 2d 832 (2024), on Auer
deference, but declined to definitively rule on this issue. See Waggoner, at
*46. Mehlberg found Auer deference still applicable, see 2025 U.S. Dist.
LEXIS 84589, WL 1260700, at *5, as did Buescher, which noted that
permitting deference to an agency’s interpretation of its own parroting
regulation, when deference to the regulation’s interpretation of the underlying
statute would itself be impermissible, “would seem an improper end run
around Loper Bright.” 2025 U.S. Dist. LEXIS 135992, 2025 WL 1927503, at
*26. Bokma declined to affirmatively rule on the interplay of Auer and Loper
Bright. See 783 F. Supp. 3d at 897. As no compelling authority has yet ruled
on this issue, this Court will continue to apply both Auer and Gonzalez v.
Oregon.

After weighing the arguments on either side of this question, the Court agrees with
Bally’s that, under Gonzalez v. Oregon and Sun Capital Partners, Auer deference is
not required here. While the Departments’ interpretation, as expressed in its preamble
and in its arguments in Macy’s, is a reasonable interpretation of an ambiguous
regulatory phrase (“full reward”), that phrase is clearly parroted from the underlying
statutory text, 42 U.S.C. § 300gg-4(j)(3)(D). And although that statute may itself (as
identified in Waggoner) have incorporated language from preexisting Department of
Labor regulations, [plaintiff] has presented no authority suggesting the Court must
stretch Auer deference through 42 U.S.C. § 300gg-4(j)(3)(D) to its regulatory
predecessor. The Court, as such, declines to do so.

Williams v. Bally's Mgmt. Grp., LLC, 2025 WL 30787472025 U.S. Dist. LEXIS 217102 at
**24-27 (D.R.I. Nov. 4, 2025). The Noel court echoed that same conclusion, finding that
plaintiff’s Auer deference “fails to grapple with the fact that the regulation at issue merely
repeats the ‘full reward’ language from the statute verbatim…. [and that] [u]nder the so-
called ‘anti-parroting doctrine,’ ‘a court need not defer to an agency’s interpretation of a
parroting regulation because an agency does not acquire special authority to interpret its own
words when, instead of using its expertise and experience to formulate a regulation, it has
elected merely to paraphrase the statutory language.” 2026 U.S. Dist. LEXIS 41586, at *32.
This Court agrees with Williams, Wilson, and Noel, and also declines to ascribe Auer
deference to the DOL’s interpretation of “full reward,” as set forth in its preamble and its litigation
position in Macy’s. Therefore, this Court must interpret the meaning of “full reward” as used in the
statute itself. While Bokma and Mehlberg involved similar reward programs to the present case,
those courts found Auer deference applied, and, therefore, their analysis does not aid the Court in its
resolution as to the correct interpretation of the “full reward” language.
As for the proper meaning of full reward under the statute, the Court agrees with Noel and
Williams that the statute does not say anything about a retroactive reward and there is no reason to
imbue the statute with such a requirement. The Noel court aptly stated:
As a threshold matter, the Court is not convinced that the ‘full reward’
requirement entitles participants who complete a reasonable alternative standard
to an amount reflective of the entire Plan year. If an employer creates a program
where the reward is the absence of a surcharge, and the surcharge is indeed fully
removed once participants complete the reasonable alternative standard, it would
be logical to conclude that the employer has thus provided the full reward - i.e.,
the complete removal of the surcharge. Nor does this reading of the statute render
the word ‘full’ superfluous, as Plaintiff argues…. For example, consider a
program that removed a surcharge entirely for participants who indicated that they
did not smoke, but provided that smokers were entitled to a reduced surcharge for
completing a smoking cessation program. It is clear that such a program would
not offer the ‘full reward.’

Noel, 2026 U.S. Dist. LEXIS 41586, at *30-31. The Court further agrees with Williams’ explanation
that:
Whether an individual who receives only a prospective “absence of a surcharge”
halfway through the plan year obtains the same reward as an individual who did not
have to pay the surcharge from the beginning of the year is a matter of perspective:
while on the one hand the first individual received a different reward because that
individual had to pay the tobacco surcharge up until the time they completed the
program, on the other hand both receive the same reward of not being prospectively
charged a tobacco surcharge. Given this statutory ambiguity, the Court declines to
impose a retroactive reimbursement requirement that is not clearly defined in the
statute on Bally’s Management.

Williams, 2025 U.S. Dist. LEXIS 217102, at *30.
The Court is aware that other cases have come to a different conclusion. As referenced,
supra, Plaintiffs have cited a recent decision from the Western District of Texas, Wilson v. Whole
Food Market, Inc., 2026 WL 196517 (W.D. Texas, Jan. 20, 2026). (R. 30). Even that decision,
however, agreed that Auer deference was not warranted, as to do so would be “an improper end run
around Loper Bright…” Id. at *9 (citing Buescher, 791 F. Supp. 3d at 906). Ultimately, that court
determined that “[w]ere the Court to interpret ‘full reward’ as Defendants suggest—namely, that the
‘full reward’ entails only the absence of a surcharge on a going forward basis—the word ‘full’ would
not be given effect. Put differently, if all that ERISA and its implementing regulations require is that
participants who complete the program stop paying the surcharge in future pay periods, the statute
and regulations could have accomplished that objective merely by providing that the “reward” must
be made available.” Id. at *10. While the Court appreciates the reasoning behind this analysis, it
does not agree with it, as it runs contrary to the plain language of the statute. The full reward is still
ob tained going forward, and the term full was necessary to clarify that an individual who stopped
smoking, obtained the COVID vaccine, or completed a reasonable alternative would not be
subjected to a reduced reward. If Congress intended the statute to provide the reward retroactive for
the entire plan year, then it could have easily stated as much. Consequently, the statute reasonably
reads as applying the full reward, not a reduced reward, to participants when they satisfy the
wellness program or the reasonable alternative standard.
The Court finds that, as a matter of law, neither 42 U.S.C. § 300gg-4(j)(3)(A) nor 29 C.F.R. §
2590.702(f)(4)(iv) require Progressive to provide retroactive reimbursements of the tobacco and
vaccine surcharges.
B. Count Five: Breach of Fiduciary Duty in Violation of ERISA
Defendant also seeks dismissal of Count Five, arguing Plaintiffs’ breach of fiduciary duty
cause of action in Count Five fails to state a claim. Defendant offers three arguments in favor of
dismissal. (R. 13, PageID# 90). Specifically, Defendants allege that the Complaint fails to allege an
act that involves fiduciary conduct, nor does it allege a transaction that is prohibited by 29 U.S.C. §

1106. Id. Finally, Defendants argue that Plaintiffs have failed to plausibly allege a loss to the plan.
(R. 13., PageID# 91-92).
1. Lack of Fiduciary Conduct
“In every case charging breach of ERISA fiduciary duty, then, the threshold question is not
whether the actions of some person employed to provide services under a plan adversely affected a
plan beneficiary’s interest, but whether that person was acting as a fiduciary (that is, was performing
a fiduciary function) when taking the action subject to complaint.” Pegram v. Herdrich, 530 U.S.
211, 226, 120 S. Ct. 2143, 2152-53 (2000); accord Sec’y of Lab. v. Macy's, Inc., No. 1:17-CV-541,
2021 WL 5359769, at *18 (S.D. Ohio Nov. 17, 2021) (“When the employer alters the terms of a
pl an, the employer is acting as a settlor rather than a fiduciary.”)
The Court agrees with Defendant that it acted as a settlor when it designed the wellness
programs that Plaintiffs now challenge. “ERISA’s fiduciary duty requirement simply is not
implicated where [a defendant], acting as the Plan’s settlor, makes a decision regarding the form or
structure of the Plan….” Hughes Aircraft Co. v. Jacobson, 525 U.S. 432, 444, 119 S. Ct. 755, 763,
142 L. Ed. 2d 881 (1999).
The Complaint’s allegations revolve around the contention that Defendant’s Plan,
specifically the wellness programs, failed to comply with ERISA. The Court has determined that
Plaintiffs have failed to state an actionable claim, as the Plan does not violate the provisions
identified by Plaintiffs. In Macy’s, the court determined that “the Secretary’s only apparent
allegation about implementation is that Macy’s implemented a discriminatory wellness program in
accordance with the impermissibly discriminatory terms it established when it created the program.
This is not enough to make Macy's a fiduciary rather than a settlor with respect to the conduct of
which the Secretary complains.” Macy's, Inc., 2021 WL 5359769, at *18 (emphasis added). The

Noel court also agreed that claims nearly identical to Plaintiffs’ herein failed to state a claim for
breach of fiduciary duty. 2026 U.S. Dist. LEXIS 41586, at *42 (S.D.N.Y. Feb. 27, 2026) (“Because
‘[t]here can be no breach of fiduciary duty where an ERISA plan is implemented according to its
written, nondiscretionary terms,’ … these allegations are deficient.”) (citations omitted). “[S]imply
administering a plan according to its terms, when the terms themselves are the basis for claimed
breach of fiduciary duty, does not implicate the discretionary authority or control over plan
administration or management, exercise of authority or control over management or disposition of
the plan’s assets, dispensing of investment advice, or benefit determinations that normally
constitutes a fiduciary act under ERISA.” Waggoner, No. 24-CV-2217, at 64-65. See also Laurent v.
P ricewaterhouseCoopers LLP, No. 06-CV-2280 (JPO), 2018 WL 502239, at *3 (S.D.N.Y. Jan. 19,
2018) (disagreeing “with the notion that ERISA imposes a general fiduciary duty on a plan
administrator to comply with each and every provision in the statute”).
Therefore, Count Five fails to state a claim.
2. Lack of a Prohibited Transaction
Plaintiffs argue that “where a fiduciary uses plan funds ‘for its own purposes,’ it violates both
of these ERISA duties [breach of fiduciary duty and prohibited transaction]”). (R. 14, PageID# 198,
n. 31, citing Patterson v. United Healthcare Ins. Co., 76 F.4th 487, 496 (6th Cir. 2023)). Plaintiff’s
argument, however, assumes that Defendant was acting as a fiduciary in its role, and, as discussed
above, it was merely acting as a settlor in designing and implementing the plan. ERISA’s prohibited
transaction provisions in 29 U.S.C. § 1106(a), (b) applies only to fiduciaries.
Again, this Court’s decision is consistent with Noel, where the plaintiff accused the
defendants therein of “robbing the Plan of Plan assets.” But the court found that plaintiff’s grievance
was simply “with the collection of the surcharge from the participants, which is a feature of the

structure of the Plan and therefore implicates a settlor rather than fiduciary function.” Noel, 2026
U.S. Dist. LEXIS 41586, at *47.
Finally, the Court agrees with Defendant that ERISA plainly permits the wellness programs
involving the collection of premiums and surcharges, even if Plaintiffs challenge these two particular
programs as unlawful. To characterize the mere act of collecting premiums and/or surcharges as an
unlawful transaction would essentially nullify even ERISA compliant wellness programs.
B . Standing
Standing has three components: “The plaintiff must have (1) suffered an injury in fact,7 (2)
that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be
redressed by a favorable judicial decision.” Ward v. Nat'l Patient Acct. Servs. Sols., Inc., 9 F.4th 357,
360–61 (6th Cir. 2021) (quoting Spokeo, Inc. v. Robins, 578 U.S. 330 (2016)). Plaintiff, as the party
invoking federal jurisdiction, bears the burden of establishing these standing elements. Id. To meet
this burden, the plaintiff must “clearly allege facts demonstrating” each element. Id. (quoting Warth
v. Seldin, 422 U.S. 490, 518 (1975)). “Since they are not mere pleading requirements but rather an
indispensable part of the plaintiff's case, each element must be supported in the same way as any
other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of
evidence required at the successive stages of the litigation.” Lujan v. Defenders of Wildlife, 504 U.S.
555, 561 (1992). Moreover, “[t]here is no ERISA exception to Article III.” Thole v. U.S. Bank N.A.,
590 U.S. 538, 547 (2020) (“Article III standing requires a concrete injury even in the context of a
statutory violation.”).

In Parker v. Tenneco, Inc., 114 F.4th 786, 797 (6th Cir. 2024), cert. denied, 145 S. Ct. 1060,
220 L. Ed. 2d 386 (2025), the Sixth Circuit acknowledged that ERISA does “not provide a remedy for
individual injuries distinct from plan injuries,” (citing LaRue v. DeWolff, Boberg & Associates, Inc.,
552 U.S. 248 (2008)). “While LaRue acknowledged the possibility of a participant bringing a claim
under § 502(a)(2) regarding her individual plan account, LaRue still affirmed the principle in Russell
that § 502(a)(2) provides a remedy for ‘plan injuries,’ not individual ones.” Parker, 114 F.4th at 795.

7 “To establish Article III standing, a plaintiff must show … an ‘injury in fact,’ which must be
‘concrete and particularized’ and ‘actual or imminent, not ‘conjectural’ or ‘hypothetical.’" Susan B.
Anthony List v. Driehaus, 573 U.S. 149, 158 (2014) (quoting Lujan, 504 U.S. at 560).
Defendant argues that Plaintiffs herein lack standing because they do not allege that the
purported violations of the regulation caused them an Article III injury in fact. (R. 13, PageID# 79).
Indeed, Defendant contends Plaintiffs allege “the tobacco-free discount violates ERISA because it
does not provide retroactive reimbursement[,]” but Defendant further highlights that Vaughn does
not allege that he qualified for the discount either by stopping tobacco use or by participating in a
wellness program. (R. 13, PageID# 80). Defendant further points out that neither Plaintiff alleges
they would have availed themselves of some reasonable alternative. (R. 13, PageID# 83). Finally,
Defendant argues that even if a retroactive reward or reimbursement were required, Vaughn would
not receive any relief because he was not entitled to one as he never stopped smoking or inquired
about an alternative. Therefore, Defendant argues standing is non-existent. (R. 13, PageID# 80).
Defendant also points out that Vaughn does not allege that he contacted the Human Resources to
“find a wellness program with the same reward that is right for you in light of your health status[.]”
(R. 13, PageID# 80, citing R. 13-1, SPD at 12). Further, Defendant argues there is no allegation that
he completed such a program, and was denied retroactive reimbursement. Id.

Plaintiff counters that Vaughan has standing because he is challenging the legality of the
wellness program. (R. 14, PageID# 186). Plaintiff appears to concede that he is not arguing he was
improperly denied benefits under the program, or that he ever sought out an alternative standard.
Instead, Plaintiff contends that Defendant’s Plan is illegal because: (1) it failed to offer an alternative
standard for smokers, (2) it did not provide a mechanism, to offer the “full reward,” and (3) it failed
to issue the required notice. Id. Each of these failures, Plaintiffs allege, violates ERISA’s regulatory
framework. Id. This, of course, is not a factual allegation but a legal conclusion.
With respect to Counts One through Five, the Court declines to address the issue of standing
as these counts fail to state a claim, as discussed above. In the interests of judicial economy, the Court
fi nds resolution of this issue to be unnecessary.8 With respect to Count Five, the Court does not
construe the motion to dismiss as raising a clear and unambiguous claim that Plaintiffs lack standing
to raise a breach of fiduciary duty claim. As such, the Court declines to issue an advisory opinion on
the issue.
C. Administrative Exhaustion
The Court also declines to address Defendant’s administration exhaustion argument in the
interests of judicial economy, as the Court has determined the Complaint fails to state a claim.9
IV. Conclusion
Based on the foregoing, the Complaint fails to state an actionable claim. Therefore, the Court
GRANTS Defendant’s Motion to Dismiss the Complaint pursuant to Federal Rule of Civil
Procedure 12(b)(6).
IT IS SO ORDERED.
David A. Ruiz
David A. Ruiz
United States District Judge

Date: March 20, 2026

8 The Court notes that the majority of cases that have addressed the issue have found that plaintiffs
who pay a surcharge with respect to an allegedly illegal wellness program have standing. See Noel v.
Pepsico, Inc. & Pepsico Admin. Comm., No. 24-CV-7516 (CS), 2026 U.S. Dist. LEXIS 41586, at
*20-21 (S.D.N.Y. Feb. 27, 2026) (collecting cases).
9 The Court does note that in Hitchcock v. Cumberland Univ. 403(b) DC Plan, 851 F.3d 552, 564
(6th Cir. 2017), the Sixth Circuit Court of Appeals held that “(1) there is no exhaustion requirement
for ERISA claims alleging statutory, rather than plan-based, violations[.]”

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11309165. Public record. Not legal advice.