This document provides a summary of a presentation by Lee W. Marcus on innovative pretrial practices and procedures for litigating disability insurance claims. The presentation covered topics such as permissible venue in ERISA cases and concerns about forum shopping, when to file a motion to transfer venue, differences between ERISA and non-ERISA cases regarding venue and choice of law, reasons for removing ERISA cases to federal court, and advantages of filing motions under Rule 52 versus Rule 56.

1. Innovative Pretrial
Practice & Procedures
Litigating Disability Insurance Claims
American Conference Institute – January 24-25, 2013
Lee W. Marcus, Esq.
Orlando, FL

2. Venue
ERISA
• Permissible Venue - 1132(e)(2)

An action “may be brought in the district where the plan is
administered, where the breach took place, or where a
defendant resides or may be found”

3. Venue
ERISA
• Plaintiff advantage/Defense concern:

Forum shopping among circuits for favorable law
• Favorable decisions on standard of review
• Favorable decisions on scope of discovery
• Favorable decisions on scope of evidence

4. Venue
ERISA
• Plaintiff advantage/Defense concern:


More convenient (and cheaper) for Plaintiff‟s counsel
Less convenient (and more expensive) for defense
BUT

Could be more expensive/inconvenient for Plaintiff at
time of mediation/trial

5. Venue
ERISA
• FILE MOTION TO TRANSFER?

Knee-jerk reaction – YES
Defense advantages:
-
Preferable case law in target district
Less expensive/inconvenient for witnesses
Preference for defense counsel/judges in target district
Plaintiff‟s counsel may not be licensed in target district

6. Venue
ERISA
• FILE MOTION TO TRANSFER?

Reasons to consider not filing motion:
- Expense of motion vs. likelihood of success
- Preference for defense counsel/judge in original district
- Tradeoff on other issues (e.g. scope of discovery)

7. Venue
ERISA
• MOTION TO TRANSFER

Forum non conveniens
•
•
•
•
Location
Location
Location
Location
of
of
of
of
material witnesses
corporate rep (for mediation/trial)
employment
adjustment of claim

8. Venue
Non-ERISA



Proper venue
USUALLY
• Place where defendant does business
• Place where contract was entered into or delivered
• Place where alleged conduct occurred
Can vary by state
• E.g. PA - allows where Plaintiff resides
Not aware of any that permit “where Plaintiff‟s lawyer does
business/resides”

9. Venue
Non-ERISA



If no contractual provision, selected venue could impact
choice of law rule to be applied
Federal Courts (diversity) apply choice of law rules of state in
which case was first properly filed, regardless of transfer.
Choice of law analysis is particularly important as it relates to
claims for bad faith
E.g. Pastor v. Union Central Life Ins. Co., 184 F.Supp.2d 1301
(S.D. Fla. 2002)
E.g. Nichols v. Northwestern Mut. Life Ins. Co., 2012 WL 2498848
(9th Cir. 2012)

10. Venue
Non-ERISA

State vs. Federal
• Why Plaintiff Wants State/Why Defendants Remove





Less chance of SJ in state court
More liberal discovery in state court
More liberal deadlines in state court
Plaintiff‟s counsel might not be licensed in federal court or
have experience with Fed.R.Civ.P.
In some jurisdictions, more sophisticated jury pool in
federal court

11. Venue
Non-ERISA

State vs. Federal
• Why Plaintiff May Want Federal




Case will move to trial faster
Less judicial tolerance for discovery abuses and delay
Can plead for punitive damages from outset
Procedural preferences over state court

12. Venue
Removal of ERISA Cases

ERISA cases should ALWAYS be removed to federal court if
filed in state court
• State judges unfamiliar with law regarding:



Standard of Review
Limitations on Discovery
Limitations on Evidence
• State judges are predisposed to state SJ standards

13. Venue
Removal of ERISA Cases

Plaintiffs challenge removal based on:
• Statutory Safe Harbor

29 USC 1003(b)
• Governmental plan
• Church plan

14. Venue
Removal of ERISA Cases

Plaintiffs challenge removal based on:
• Regulatory Safe Harbor

29 CFR 2510-3.1(j)
• (1) Sponsor doesn‟t contribute to plan
• (2) Participation in the plan is voluntary
• (3) Sponsor doesn‟t endorse participation, but may allow publicizing and
facilitate payment of premiums through payroll deductions
• (4) Sponsor receives no consideration

15. Venue
Removal of ERISA Cases

Burden of proving applicability of ERISA rests on removing
party
• Should attach supporting documentation to motion
•
•
•
•
Affidavit from administrator or sponsor
Group policy
Summary Plan Description
DOL 5500

16. Rule 56 vs. Rule 52
ERISA

RULE 56
• The judgment sought shall be rendered forthwith if the
pleadings, depositions, answers to interrogatories and
admissions on file, together with the affidavits, if any, show that
there is no genuine issue as to any material fact and that the
moving party is entitled to judgment as a matter of law.

RULE 52
• In an action tried on the facts without a jury or with an advisory
jury, the court must find the facts specially and state its
conclusions of law separately. . . Findings of fact, whether based
on oral or other evidence, must not be set aside unless clearly
erroneous, and the reviewing court must give due regard to the
trial court's opportunity to judge the witnesses‟ credibility.

17. Rule 56 vs. Rule 52
ERISA

“ERISA” and “DISABILITY” and “RULE 56” in Allfeds
• 2652 results

“ERISA” and “DISABILITY and “RULE 52” in Allfeds
• 285 results
• Fewer than half involved actual Rule 52 motions

18. Rule 56 vs. Rule 52

Reasons to move for summary judgment
• Purely legal question



Release
Statute of Limitations
Policy Interpretation
• 2 “bites at the apple”
• “Sneak peek” at the other side‟s case

19. Rule 56 vs. Rule 52

Reasons for Rule 52 motion
• Different standard on appeal creates greater
finality
• Creates vehicle for seeking oral argument and
presentation of evidence

Particularly important in cases with surveillance

20. Rule 56 vs. Rule 52

Appellate Review
• Rule 56

de novo review of trial court decision
• Rule 52


de novo review of trial court‟s decision on which standard
of review to apply
“clearly erroneous” review applied to findings of fact and to
application of law to facts

21. Rule 56 vs. Rule 52

Rule 52 appeals
• “[A] finding [of fact] is clearly erroneous and reversible under
Rule 52(a) only when the reviewing court on the entire evidence
is left with a definite and firm conviction that a mistake has been
committed. If the district court's findings of fact are plausible in
light of the record viewed in its entirety, the court of appeals
must accept them even if it is convinced that had it been sitting
as the trier of fact, it would have weighed the evidence
differently.”

Childrey v. Bennett, 997 F.2d 830, 833 (11th Cir.1993)
• “A finding of fact is not clearly erroneous unless „it is without
factual support in the record, or if the appellate court, after
reviewing all the evidence, is left with the definite and firm
conviction that a mistake has been made.‟ ”

Las Vegas Ice & Cold Storage Co. v. Far West Bank, 893 F.2d 1182, 1185
(10th Cir.1990)

22. Rule 56 vs. Rule 52

Rule 52 appeals
• District court only reverses decision if administrator was
“unreasonable”
• Circuit court only reverses District court if it‟s conclusion
as to “reasonableness” was “reasonable”
• Essentially, Circuit court will only reverse for procedural
irregularities by trial court



Failure to apply proper standard of review
Failure to adhere to proper procedure
“Clear error” as to factual findings (very rare)

23. Rule 56 vs. Rule 52

“When there is conflicting evidence from which different
inferences may be drawn regarding the reasonableness of a
defendant's conduct, then what is reasonable is always a
question to be determined by the trier of fact.”
• Denham v. Sunoco, Inc. (R&M) 222 Fed.Appx. 687, 690 (10th Cir.
2007)
Thus, the determination of “reasonableness” is a finding of fact,
requiring “clear error” for reversal on appeal

24. Rule 56 vs. Rule 52

“The district court's finding that [the plaintiff] qualifies for
long-term disability benefits is a finding of fact subject to
the clearly erroneous standard of review. This standard
plainly does not entitle a reviewing court to reverse the
finding of the trier of fact simply because it is convinced
that it would have decided the case differently. The
reviewing court oversteps the bounds of its duty under Rule
52(a) if it undertakes to duplicate the role of the lower
court.”
• Sloan v. Hartford Life and Acc. Ins. Co., 475 F.3d 999,
1005 (8th Cir. 2007) [citations omitted]

25. Rule 56 vs. Rule 52

“Those who wish to ensure that a judgment is treated with
the deference due the result of a bench trial are advised to
eschew Rule 56 and stick to Rule 52(a).”
• Patton v. MFS/Sun Life Financial Distributors, Inc. 480 F.3d
478, 484 (7th Cir. 2007)

26. Innovative Pretrial
Practice & Procedures
Litigating Disability Insurance Claims
American Conference Institute – January 24-25, 2013
Lee W. Marcus, Esq.
Orlando, FL