The 10th Circuit Court of Appeals recently issued a decision addressing two ERISA issues: (1) what constitutes a “governmental plan;” and (2) the right to trial by jury. These issues were addressed in the case of Shirley Graham v. Hartford Life and Accident Insurance Company, 589 F.3d 1345 (10th Cir. 2009), decided December 29, 2009. This was an appeal out of the Northern District of Oklahoma.
At issue was Ms. Graham’s claim for long-term disability (LTD) income protection benefits. She was a former employee of the United States Postal Service (USPS). Unlike most LTD plans, Ms. Graham was insured under a plan established by the National Rural Letter Carriers Association (NRLCA), recognized by the USPS as the exclusive bargaining representative for rural letter carriers. The NRLCA procured the group long-term disability policy from Hartford. USPS was not involved in those negotiations, nor did it sponsor the plan. Given these facts, the Court concluded that although Ms. Graham was considered a governmental employee of the USPS, the actual plan and policy at issue was obtained by an employee organization, and not the governmental employer. As a result, the plan was not a “governmental plan” and therefore not exempted from ERISA.
Similar to Ms. Graham’s case, my office undertakes an analysis of every new client as to whether ERISA governs the dispute with the plan or the insurance company. The irony is that a plan participant (employee) typically does not want to have their case governed by ERISA if at all possible, even though ERISA was allegedly passed to protect just that individual.
The second legal issue addressed by the Graham decision was whether there exists a right to a jury trial in a claim for benefits under 29 U.S.C. § 1132(a)(1)(B). Following a prior decision in the 10th Circuit, and consistent with many other circuits which have addressed this issue, the Court found that no Seventh Amendment right to jury trial attaches to such a claim.
As a side note, a law enacted in the State of Colorado in August 2008 found at C.R.S. §10-3-1116 specifically states that all claims under an insurance policy are to have that controversy decided by a jury trial, if requested by the Plaintiff. The question remains unanswered whether this recently enacted Colorado law would be preempted by ERISA.
The Law Office of Shawn E. McDermott, LLC has addressed issues similar to those presented in the Graham case. We have represented, and continue to represent, multiple individuals whose disability benefits have been denied including those who were in fact considered to be a governmental plan and thus not subject to ERISA. Please feel free to contact our office if you have any questions concerning the denial of your claim for long-term disability benefits under either an individual policy you have purchased on your own or one that you find your self a participant of by virtue of your employment.