United States District Court, N.D. California
For William David Brown, on behalf of himself and all others similarly situated, Plaintiff: Teresa Renaker, Lewis, Feinberg, Lee, Renaker & Jackson, P.C., Oakland, CA.
For California Law Enforcement Association, Long-Term Disability Plan, California Law Enforcement Association, California Administration Insurance Services, Inc., Defendant, 3rd party plaintiff: Audrey Anne Millemann, LEAD ATTORNEY, Weintraub Genshlea Chediak Sproul, Sacramento, CA; Louis A. Gonzalez, Jr., Weintraub Tobin Chediak Coleman Grodin, Sacramento, CA.
For Oakland Police Officers Association, 3rd party defendant: James Pieper Keenley, LEAD ATTORNEY, Bolt Keenley Kim LLP, Berkeley, CA.
ORDER GRANTING MOTION TO DISMISS THIRD PARTY COMPLAINT Re: Dkt. No. 35
JOSEPH C. SPERO, Chief United States Magistrate Judge.
Presently before the Court is Third Party Defendant's Motion to Dismiss Third
Party Complaint (" Motion" ). The Court held a hearing on the Motion on February 27, 2014. For the reasons stated below, the Motion is GRANTED.
In this case, Plaintiff William Brown, who is medically retired from the Oakland Police Department, has filed a putative class action against his long-term disability plan, the plan's sponsor, and the plan's administrator under ERISA for denied benefits and breach of fiduciary duty. Defendants are California Law Enforcement Association Group Long Term Disability Plan (" CLEA Plan" ); California Law Enforcement Association (" CLEA" ); and California Administration Insurance Services, Inc (" CAISI" ). The CLEA Plan is offered by CLEA and administered by CAISI. Defendants have in turn filed a Third Party Complaint against Brown's employee organization, the Oakland Police Officers' Association (" OPOA" ).
The dispute arises from the following alleged facts: In July 2011, Brown became " totally disabled" within the meaning of the CLEA Plan. Compl. at 6. He went on a leave of absence from Oakland Police Department from July 2011 through June 2012. Id. at 3. During his leave of absence, Brown received pay pursuant to California Labor Code § 4850 (" § 4850" ), and OPOA withheld part of his paycheck to pay the monthly premium contributions for Brown's CLEA Plan. Id. In November 2011, Brown submitted a written claim for long-term disability benefits under the CLEA Plan. Id. at 3--4. Effective May 1, 2012, OPOA switched its members' long-term disability coverage to another provider and stopped paying premiums to Brown's CLEA Plan. Id. at 4. In June 2012, Brown medically retired from the Oakland Police Department. Id. at 3.
In June 2012, when Brown informed CAISI of his retirement date, CAISI responded that he was no longer eligible for the benefits " because OPOA had stopped paying premiums for the CLEA Plan." Compl. at 4. Then in September 2012, CAISI issued a formal, written denial of Brown's claim, contending that " in order to maintain their eligibility for benefits, CLEA Plan participants are required to continue paying premiums even after becoming totally disabled, during the period that they receive Section 4850 pay," thus denying Brown's claim " on the ground that his payment of premiums did not continue from the time he became disabled until his disability retirement." Id.
Among other claims, Brown alleges that Defendants never informed him that he needed to continue paying premiums in order to remain eligible for benefits: Defendants failed " to inform [Brown and the putative class members] that CLEA and CAISI interpreted the CLEA Plan to condition eligibility for benefits on continued payment of premiums even after a participant incurred a covered disability, even while CLEA and CAISI communicated other information to CLEA Plan participants about coverage changes." Compl. at 8. Brown alleges that by failing to disclose such important ...