Caldwell v. UnitedHealthcare Insurance Company

Background

Mary Caldwell alleged that she was diagnosed with Stage 3 lipedema, a painful and immobilizing condition involving abnormal fat buildup. Her physician proposed specialized liposuction, which Caldwell alleged was the only available treatment. UnitedHealthCare Insurance Company and United HealthCare Services, Inc. (together, “United”) denied coverage, stating that the procedures were not proven helpful for people with her condition and were therefore “unproven services” excluded by her plan. United also denied her appeal.

Caldwell filed an action under the Employee Retirement Income Security Act (ERISA) on behalf of herself and others similarly situated. Her first claim, under 29 U.S.C. § 1132(a)(1)(B), sought payment of benefits, enforcement or clarification of her rights under the plan, medical expenses, interest, and attorney’s fees. Her second claim, under § 1132(a)(3), sought declaratory, equitable, and remedial relief for an alleged breach of fiduciary duty. The court stated that it was premature to analyze the claims on a class-wide basis and limited the order to whether Caldwell adequately pleaded her individual claims.

Analysis

Section 1132(a)(1)(B) claim. The defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint does not adequately state a legal claim. The court granted the motion as to this claim on two grounds.

First, Caldwell did not adequately allege the existence of an ERISA plan. She alleged that she was covered by an employee-benefit plan established or maintained through her employer and insured or administered by United for health-care benefits. The court found these allegations merely repeated generic ERISA-plan elements and did not provide facts about her particular plan. The court held that the pleadings did not raise the existence or creation of an ERISA plan above the speculative level.

Second, Caldwell did not identify a plan provision entitling her to coverage for specialized liposuction. The court rejected her argument that defeating United’s “unproven” classification would itself establish coverage. Even if she showed that the procedure was proven, she had not pleaded facts showing that the procedure was covered under a specific term of her plan. The motion to dismiss this claim was therefore granted.

Section 1132(a)(3) claim. The court denied the motion to dismiss Caldwell’s claim for equitable relief under § 1132(a)(3). The court explained that this provision can serve as a “safety net” when other ERISA remedies are inadequate, and that Ninth Circuit precedent permits a benefits claim under § 1132(a)(1)(B) and an equitable-relief claim under § 1132(a)(3) to proceed simultaneously as alternative theories. The court stated that Caldwell could pursue both claims without obtaining duplicate recoveries.

Disposition

The court granted in part and denied in part the defendants’ motion to dismiss. It granted the motion as to Caldwell’s § 1132(a)(1)(B) claim and denied it as to her § 1132(a)(3) claim. The order did not decide whether Caldwell ultimately was entitled to coverage or other relief.