DRI members Martin E. Rosen and Jenny H. Wang, partners with Barger & Wolen LLP in Los Angeles and Newport Beach, California, respectively, recently obtained a summary judgment from the U.S. District Court for the Central District of California. The court ruled that a plaintiff seeking long-term disability (LTD) benefits under an ERISA-governed employee welfare benefit plan cannot maintain his lawsuit without first exhausting the plan’s administrative remedies and that appeals for help to the Department of Insurance do not constitute the proper exhaustion of remedies. On that basis, the court summarily dismissed the plaintiff’s lawsuit.
Defendant United of Omaha Life Insurance Company administered plaintiff Richard Carey’s claim for LTD benefits under an ERISA plan established by his employer. Carey claimed that he was totally disabled as defined by the plan and thus entitled to benefits. After investigation, United denied Carey’s claim. In its denial letter, United told Carey that he had the right to administratively appeal the claim denial, as set forth in the plan, and that he had to submit any appeal within 180 days. The letter also informed Carey of his right to contact the Department of Insurance (DOI) about United’s handling of his claim.