Florida Court Denies MetLife’s Counterclaim for SSDI Overpayment in ERISA Long Term Disability Claim

Existing ERISA law regarding equitable liens provides that only an “identifiable fund” of money can be recovered since ERISA is an equitable statute and does not allow recovery of pure money damages. Based on such ERISA tenet, a Middle District of Florida court denied MetLife’s claim for reimbursement of an overpayment to a long term disability claimant based on the claimant’s SSDI award which offset his long term disability benefits under the subject disability policy. The Plaintiff filed an affidavit stating all the money had been spent and thus no identifiable fund existed. Herman v. MetLife, December 29, 2009

Court Punts in the Face of CIGNA’s Disregard of LTD Claimant’s SSDI Award

An Illinois district court, after remand by the Seventh Circuit, recognized that CIGNA’s disregard of an ERISA claimant’s award of SSDI benefits, after providing an advocate to the long term disability claimant to secure the same, added weight to the notion that CIGNA was operating under a conflict of interest. The court however, distinguished the case from others because the claimant had been denied SSDI benefits twice before being approved months later, and because CIGNA performed an independent medical evaluation which the court believed reflected “safeguard procedures to minimize conflict.” Thus, instead of overturning CIGNA’s long term disability claim determination as being influenced by its conflict of interest, the court simply remanded the case back to CIGNA for explanation of its disagreement with the SSA’s decision, as failure to provide such explanation was inconsistent with ERISA’s requirement that specific and understandable reasons be communicated for denial. Raybourne v. CIGNA, February 8, 2010