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Coleman Scott Moffett, On His Own Behalf and On Behalf of All v. Prudential Life

November 30, 2012

COLEMAN SCOTT MOFFETT, ON HIS OWN BEHALF AND ON BEHALF OF ALL OTHER PERSONS SIMILARLY SITUATED,
PLAINTIFFS,
v.
PRUDENTIAL LIFE INSURANCE COMPANY OF AMERICA; HILDA L. SOLIS, IN HER OFFICIAL CAPACITY AS SECRETARY OF THE UNITED STATES DEPARTMENT OF LABOR,
DEFENDANTS. CHRISTOPHER C. OUELLETTE, ON HIS OWN BEHALF AND ON BEHALF OF ALL OTHER PERSONS SIMILARLY SITUATED,
PLAINTIFFS,
v.
PRUDENTIAL FINANCIAL, INC. (D/B/A PRUDENTIAL INSURANCE COMPANY OF AMERICA; AND HILDA L. SOLIS (SECRETARY OF THE DEPARTMENT OF LABOR), DEFENDANTS.



The opinion of the court was delivered by: Robert L. Wilkins United States District Judge

SUMMARY OPINION AND ORDER; NOT INTENDED FOR PUBLICATION IN THE OFFICIAL REPORTERS

MEMORANDUM OPINION*fn1

This action centers on Plaintiff Coleman Scott Moffett's ("Moffett") and Christopher C. Ouellette's ("Ouellette") (collectively, "Plaintiffs") challenge to Prudential Life Insurance Company of America's ("Prudential") employer-based disability plan. In short, Plaintiffs contend that the structure of Prudential's plan-through which Prudential not only makes initial determinations on participants' eligibility for benefits, but also reviews those determinations through an internal appeals process-does not provide for a "full and fair" review of participants' claims by a neutral party. Moffett's and Ouellette's Complaints were consolidated by the Court on March 31, 2011, as both cases asserted nearly identical claims against the same defendants-(1) alleging Fifth Amendment due process violations against Prudential; (2) alleging Fifth Amendment due process claims against Hilda L. Solis, in her official capacity as the Secretary of the Department of Labor; and (3) challenging the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001-1461, and various United States Department of Labor Rules and Regulations as unconstitutional under the due process clause.

Both Prudential and the Secretary moved to dismiss Plaintiffs' Complaints, and on September 21, 2011, the Court granted their motions and dismissed these consolidated cases with prejudice. (Dkt. Nos. 27, 28).*fn2 The Court held that Plaintiffs' due process claims against Prudential, which derived from the Fifth Amendment, were invalid as a matter of law because Prudential is not a state actor subject to constitutional scrutiny. (Id.). In addition, the Court ruled that Plaintiffs' claims against the Secretary were invalid because Plaintiffs were unable to satisfy the jurisdictional prerequisite of Article III standing to pursue those claims. (Id.).

Plaintiffs have since filed several post-judgment motions, which are now before the Court. First, Plaintiffs filed a motion to alter or amend the Court's judgment, under Federal Rule of Civil Procedure 59(e). (Dkt. No. 29). Through that motion, Plaintiffs principally assert that the Court's ruling as to their claims against Prudential through Count I "directly conflicts" with a recent Supreme Court decision, Cigna Corp. v. Amara, _ U.S._, 131 S. Ct. 1866, 179 L. Ed. 2d 843 (2011). They also contend that the Court's standing analysis, which disposed of Counts II and III against the Secretary, overlooked the allegations of Ouellette's Complaint, which Plaintiffs argue did allege a cognizable injury-in-fact for purposes of Article III. Along with their Rule 59(e) motion, Plaintiffs also filed a motion to amend their complaints under Federal Rule of Civil Procedure 15(a) and for relief of judgment of dismissal under Federal Rules of Civil Procedure 60(a) and (b)(6). (Dkt. No. 30).

Having considered Plaintiffs' motions, Prudential's and the Secretary's opposition briefing, and Plaintiffs' replies, for the following reasons, the Court will DENY Plaintiffs' motions in all respects.

ANALYSIS

A.Plaintiffs' Motion to Alter or Amend Judgment Under Rule 59(e)

Motions to alter or amend under Rule 59(e) "are disfavored and relief from judgment is granted only when the moving party establishes extraordinary circumstances." Niedermeier v. Office of Max S. Baucus, 153 F. Supp. 2d 23, 28 (D.D.C. 2001) (citing Anyanwwutaku v. Moore, 151 F.3d 1053, 1057 (D.C. Cir. 1998)). As this Circuit has explained, a Rule 59(e) motion "need not be granted unless the district court finds that there is an intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice." Messina v. Krakower, 439 F.3d 755, 758 (D.C. Cir. 2006) (quoting Firestone v. Firestone, 76 F.3d 1205, 1208 (D.C. Cir. 1996)). Consequently, "a losing party may not use a Rule 59 motion to raise new issues that could have been raised previously." Kattan by Thomas v. Dist. of Columbia, 995 F.2d 274, 276 (D.C. Cir. 1993). Nor is a Rule 59 motion a means by which to "reargue facts and theories upon which a court has already ruled," New York v. United States, 880 F. Supp. 37, 38 (D.D.C. 1995), or "a chance . . . to correct poor strategic choices," SEC v. Bilzerian, 729 F. Supp. 2d 9, 15 (D.D.C. 2010).

Through their motion, Plaintiffs conclusorily assert that all of the potential Rule 59(e) grounds for relief require the Court to revisit its dismissal ruling. (Dkt. No. 33 ("Pls.' Reply") at 2). But Plaintiffs do not point to any "new evidence" that impacts the Court's analysis, nor do they identify any "intervening change in controlling law" that would dictate a different result. Rather, Plaintiffs appear to solely contend that the Court should amend its decision because it was premised on "clear legal error" and/or creates "manifest injustice." As explained below, Plaintiffs fail to establish that they are entitled to Rule 59(e) relief on these grounds as to any of their previously-dismissed claims.

First, with respect to Count I, Plaintiffs principally contend that the Supreme Court's decision in Cigna Corporation v. Amara, _ U.S. _, 131 S. Ct. 1866, 179 L. Ed. 2d 843 (2011), somehow undermines this Court's dismissal of their claims against Prudential. Plaintiffs are wrong. In Amara, the Supreme Court was presented with the specific issue of whether the district court, upon determining that Cigna violated ERISA's disclosure obligations in connection with the change of its pension plan, properly "reformed" the terms of that plan pursuant to 29 U.S.C. § 1132(a)(1)(B), and, if so, whether the court applied the appropriate legal standards in reforming the plan. Amara, 131 S. Ct. at 1870-71. In sum, the Court concluded that § 1132(a)(1)(B) did not authorize such a reformation but explained that "a different equity-related ERISA provision . . . authorizes forms of relief similar to those that the court entered." Id. at 1871 (citing to 29 U.S.C. § 1132(a)(3)). The Court then outlined the relevant "equitable principles that the court might apply on remand" and remanded the matter for further proceedings. Id.

In relying on Amara, Plaintiffs appear to ignore the actual holding of the Court, instead choosing to seize upon the Justices' discussion of a single rejected argument advanced in support of affirmance-that the district court had not really "reformed" Cigna's plan, it simply enforced the plan's terms as written, including certain terms encompassed by the plan's disclosures and summary plan descriptions. See id. at 1877. The Court disagreed with that argument because, among other reasons, it was unwilling to find that "the terms of statutorily modified plan summaries (or summaries of plan modifications) necessarily may be enforced . . . as the terms of the plan itself." Id. Put differently, the Amara Court declined to find that terms of the summary plan descriptions should be characterized as terms of the plan itself.

Plaintiffs now argue that this passage from the Amara case requires the reinstatement of their due process claims against Prudential. Of course, this Court previously dismissed those claims on the ground that Prudential was not a "state actor" susceptible to constitutional due process claims under the Fifth Amendment. (Dkt. No. 27 ("Mem. Op.") at 8-15). On that issue, Plaintiffs now attempt to assail the Court's reasoning that Prudential's authority to determine a plan participant's benefit eligibility and to review those initial determinations "was created, not through governmental enactment but by the contract between Plaintiffs' employers and Prudential." (Pls.' Mem. at 4-5). Plaintiffs argue that, to the extent the Court looked to Prudential's summary plan documents rather than the actual plan terms themselves to support its reasoning, its holding cannot stand. The Court does not agree. Not only do Plaintiffs misunderstand Amara's impact, they also oversimplify the Court's basis for dismissing their claims against Prudential in the first place.

First, the Amara decision has absolutely no impact on this Court's conclusion that Prudential is not a "state actor." In reality, other than the fact that Amara also involved an employee-benefits plan administered under ERISA's broad statutory scheme, that case has almost nothing in common with the instant matter. As Prudential correctly points out, the critical issue underlying the Court's dismissal of the claims in this case was not whether certain plan terms were properly included in Prudential's summary plan documents, rather than within the four corners of the plan document itself. (Dkt. No. 31 ("Prud. Opp'n") at 4). Instead, the critical issue was whether Prudential's authority is rooted in a private agreement with Plaintiffs' employers or in some governmental delegation, and the Court concluded that it was the former. Nothing in Amara changes that result. Indeed, even if the Court were to credit Plaintiffs' argument to some degree, which it does not, they would be no closer to establishing that Prudential is a "state actor" subject to constitutional scrutiny. At most, Plaintiffs might raise a ...


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