Wiedo v. Securian Life Insurance Company

Background

Amanda Wiedo obtained accidental death and dismemberment coverage through her employer, McKesson Corporation. The coverage was part of an employee welfare benefit plan administered by McKesson and insured by Securian Life Insurance Company. Robert Wiedo, who was Amanda Wiedo’s husband when she died, was the beneficiary.

Robert Wiedo sought payment of the benefits from Securian, which denied the claim. After appealing the denial, he requested documents from McKesson concerning the plan. He then filed suit in Anderson Circuit Court against Securian and McKesson. The defendants removed the case to the Eastern District of Kentucky under the Employee Retirement Income Security Act, a federal law commonly known as ERISA.

After removal, McKesson provided Wiedo with the McKesson Corporation Health and Welfare Wrap Plan. The document included a forum-selection clause stating that legal actions had to be brought in the United States District Court in San Francisco, California, where the plan was administered, unless the benefit materials provided otherwise. Wiedo amended his complaint under ERISA and moved to transfer the case to the Northern District of California at San Francisco.

Legal standard

The court applied 28 U.S.C. § 1404(a), which permits transfer to another federal district for convenience and in the interest of justice. The court explained that the usual transfer analysis changes when the parties agreed to a valid and enforceable forum-selection clause. In that situation, the chosen forum generally controls, the plaintiff’s original choice of forum receives no weight, and the party opposing transfer must show that transfer is unwarranted. Public-interest considerations may still be considered, but they rarely defeat transfer.

McKesson

The court held that the forum-selection clause was enforceable against McKesson. McKesson argued that Wiedo could not enforce the clause because he initially sued in state court and because McKesson later attempted to waive the clause in a letter. The court rejected those arguments. Wiedo had not received the clause until after filing suit and removal, and McKesson itself had brought the clause to his attention. The court also concluded that McKesson could not unilaterally waive a contractual requirement that benefited both sides, particularly when Wiedo sought to enforce that provision.

Securian

The court separately considered whether the clause could bind Securian, which argued that it was not a party to the Wrap Plan and had issued a separate insurance policy to McKesson. The court found the plan documents unclear about whether the insurance policy was incorporated into the Wrap Plan. Because the documents contained inconsistent provisions, the court could not resolve the issue from the documents alone.

The court therefore applied principles allowing a forum-selection clause to bind a non-signatory when that party is closely related to the contracting parties or dispute and it was foreseeable that the party would be bound. The court held that Securian met that standard. McKesson provided the insurance to its employees, Securian insured the benefits and paid them when appropriate, and disputes over those benefits could foreseeably involve both companies. The court concluded that it was fair and equitable to bind Securian to the clause.

Public-interest considerations and ruling

The court recognized that keeping McKesson and Securian in the same action would avoid piecemeal litigation and conserve judicial resources. It rejected the defendants’ arguments that the Northern District of California was more congested and that pandemic-related restrictions in San Francisco warranted denying transfer. The court found that the districts had virtually identical average disposition times and that the defendants offered no evidence that the pandemic affected the two courts disproportionately.

The court concluded that the forum-selection clause was valid and enforceable against both defendants and that the defendants had not shown an unusual circumstance justifying denial of transfer. Judge Gregory F. Van Tatenhove granted Wiedo’s Motion to Transfer Venue and transferred the action to the United States District Court for the Northern District of California at San Francisco for all further proceedings.