United States District Court, N.D. West Virginia
BILLY E. PRINCE, Plaintiff,
SEARS HOLDINGS CORPORATION; SEARS HOLDINGS CORPORATION ADMINISTRATIVE COMMITTEE; and PRUDENTIAL INSURANCE COMPANY OF AMERICA, Defendants.
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANTS'
MOTION TO DISMISS [DKT. NO. 8] AND DISMISSING COMPLAINT WITH
M. KEELEY UNITED STATES DISTRICT JUDGE
plaintiff, Billy E. Prince ("Prince"), filed a
complaint on August 16, 2017, in which he alleged that the
defendants had breached certain fiduciary duties owed to him
under ERISA (Dkt. No. 1). Now pending is the motion to
dismiss filed by the defendants, Sears Holdings Corporation
("Sears"), Sears Holdings Corporation
Administrative Committee (the "Committee"), and
Prudential Insurance Company of America
("Prudential")(Dkt. No. 8). For the reasons that
follow, the Court GRANTS the motion and
DISMISSES Prince's complaint
Court's recitation of the facts is taken from
Prince's complaint (Dkt. No. 1), which the Court
construes in the light most favorable to Prince. See
De'Lonta v. Johnson, 708 F.3d 520, 524 (4th Cir.
is the sponsor of an employee welfare benefit plan (the
"Plan") governed by the Employment Retirement
Income Security Act of 1974 ("ERISA"), 29 U.S.C.
§ 1001 et sea. The Plan provides certain
employee benefits, including dependent life insurance
benefits (the "benefit") to eligible participants.
Prince, a Sears employee, was a participant in the Plan, and
was eligible to enroll in the benefit. Sears and the
Committee administer the life insurance plan through
about November 1, 2010, Prince submitted an application to
Sears, for $150, 000 in optional life insurance coverage for
his wife, Judith Prince ("Mrs. Prince"). On May 23,
2011, Sears sent a "Health and Group Benefits
Confirmation of Coverage" to Prince, and, in June 2011,
it began withholding premiums from his paychecks.
2011, Mrs. Prince learned that she had Stage IV liver cancer.
In October 2012, almost a year after Mrs. Prince's
initial diagnosis, Prince accessed his online Sears benefits
summary, which confirmed his election to purchase life
insurance coverage for his wife in the amount of $150, 000.
year passed, and in September 2013, Sears sent Prince an
"Account Update Notice" advising him that Mrs.
Prince's coverage had never become effective because no
"Evidence of Insurability" questionnaire had been
submitted. Sears explained that Prudential had sent a letter
to Prince in January 2011 advising that it would terminate
his application for life insurance coverage unless a
completed insurability questionnaire was submitted. Prince
claims that he has no record of receiving that letter, nor
any correspondence advising that his application for life
insurance was incomplete or had been denied, until receipt of
the September 2013 notice.
26, 2014, Mrs. Prince died, and on November 3, 2014,
Prudential denied Prince's claim for life insurance
filed a complaint against Sears in the Circuit Court of
Marion County, West Virginia, on December 8, 2014. The
complaint asserted one count of "constructive
fraud/negligent representation" and one count of
"intentional/reckless infliction of emotional
distress" based on Sears's alleged
misrepresentations regarding the optional life insurance
policy. Prince sought payment of $150, 000 and other damages.
January 16, 2015, Sears removed the case to the Northern
District of West Virginia and subsequently moved to dismiss
the complaint, arguing that ERISA completely preempted
Prince's state law claims. Prince opposed the motion and
moved to remand the case. On December 21, 2015, the Northern
District granted the motion, holding that ERISA completely
preempted Prince's claim. Accordingly, the Court denied
Prince's motion to remand and dismissed the complaint
without prejudice to refile an ERISA claim after exhausting
administrative remedies available to him (Dkt. No. 8-4).
Specifically, the Court concluded that Prince's claims
were "enforceable under section 502(a) of ERISA."
Id. at 12.
timely appealed, and on January 27, 2017, the Court of
Appeals for the Fourth Circuit affirmed, finding that ERISA
completely preempted Prince's state law claims and that
Prince's claims were "enforceable under section
502(a)." (Dkt. No. 8-5).
then filed this lawsuit against the defendants on August 16,
2017, seeking relief pursuant to ERISA section 502(a)(3),
based on the defendants' alleged breaches of fiduciary
duty (Dkt. No. 1). Prince alleges that, by letter dated
February 22, 2017 and received on March 6, 2017, Prudential
denied his second appeal and request for reconsideration of
its decision to deny his claim, and that he therefore has
exhausted his administrative remedies under ERISA.
complaint alleges a cause of action for breach of fiduciary
duty under ERISA against all defendants. He alleges that the
defendants, as ERISA fiduciaries, pursuant to section 1104,
had the duty to provide him with accurate information
regarding his wife's life insurance policy, to administer
the policy in the best interests of Mr. and Mrs. Prince, and
to discharge their fiduciary responsibilities regarding the
policy with the requisite care, skill, prudence, and
further alleges that the defendants breached the duties owed
to him by misrepresenting the status of Mrs. Prince's
life insurance coverage for over two years, by withholding
from Prince's paycheck premiums for life insurance
coverage which did not exist, by failing to promptly advise
Prince that his wife's application for life insurance was
deficient, and by failing to administer the life insurance
plan in the best interest of Mr. and Mrs. Prince.
contends that he does not have an adequate remedy pursuant to
the terms of the life insurance plan as he did not receive
notice of any deficiency with his wife's application and
therefore did not submit the evidence of insurability
questionnaire in 2011. He thus seeks equitable relief
sufficient to make him whole, pursuant to ERISA section
502(a) (3), 29 U.S.C. § 1132(a) (3) .
November 8, 2017, the defendants moved to dismiss
Prince's complaint with prejudice, arguing that his claim
is time barred by the applicable statute of limitations (Dkt.
No. 8). The motion is fully briefed, and argument was heard
on December 15, 2017.
STANDARD OF REVIEW
Civ. P. 12(b) (6) allows a defendant to move for dismissal on
the grounds that a complaint does not "state a claim
upon which relief can be granted." When reviewing the
sufficiency of a complaint, a district court "must
accept as true all of the factual allegations contained in
the complaint." Anderson v. Sara Lee Corp., 508
F.3d 181, 188 (4th Cir. 2007) (quoting Erickson v.
Pardus, 551 U.S. 89, 94 (2007)). "While a complaint
. . . does not need detailed factual allegations, a
plaintiff's obligation to provide the grounds' of his
entitle[ment] to relief requires more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do." Bell Atl. Corp. v.
Twomblv, 550 U.S. 544, 555 (2007) ...