You already know that in March 2015, the 6th Circuit issued an en banc decision rejecting disgorgement of profits claims. Rochow v. Life Ins. Co. of N. Am., 780 F.3d 364, 372 (6th Cir. 2015)(en banc) (rejecting $3.8 million disgorgement claim against Life Insurance Company of North America as “an impermissible duplicative recovery”).
But the reality is that plaintiffs in ERISA cases keep trying to assert breach of fiduciary duty/disgorgement claims. We are seeing an influx of these claims being asserted in the Ninth Circuit.
Here’s a strategic early play in these cases: move to dismiss the breach of fiduciary duty/disgorgement claim early on.
This recent case highlights the point. Gluc v. Prudential Insurance Co., 2015 WL 6394522 (W. D. Ky. October 22, 2015)(PDF).
FACTS: Judith Gluc sought ERISA-governed long term disability benefits. Prudential paid long term disability benefits for two years, and then discontinued benefits. Gluc then brought suit to recover benefits. She also alleged breach of fiduciary duty and sought disgorgement of “earnings Prudential accumulated as a result of its delay in paying her benefits.”
Gluc alleged a laundry list of purported acts which breached fiduciary duty. She claimed that Prudential’s claims process: (a) was designed to...
