Juric v. USALCO, LLC

659 F.Supp.3d 619

John JURIC, Plaintiff, v. USALCO, LLC, et al., Defendants.

CIVIL NO. JKB-22-0179

United States District Court, D. Maryland

Signed March 2, 2023

Renee Bowen, Frankilin & Prokopik, Baltimore, MD, Christopher A. Macey, Jr., Pro Hac Vice, Jennifer Calabrese Bell, Pro Hac Vice, Bell and Bell LLP, Philadelphia, PA, for Plaintiff.

Daniel C. Sale, King & Spalding LLP, Washington, DC, Michael W. Johnston, Zachary William Kewer, Pro Hac Vice, King and Spalding LLP, Atlanta, GA, for Defendants.

MEMORANDUM

James K. Bredar, Chief Judge

Plaintiff John Juric brings several claims against Defendants USALCO, LLC ("USALCO"), H.I.G. Capital, LLC ("HIG"), Peter Askew, Lawrence Askew, Jr., and Kenneth Gayer. (Am. Compl., ECF No. 47.)¹ Juric brings claims under the Employee Retirement Income Security Act of 1974 ("ERISA"), the Maryland Wage Payment and Collection Law, and Maryland common law. (Id.)

Now pending before the Court is Defendants' Motion to Dismiss. (ECF No. 24.) The Motion is fully briefed and no hearing is required. See Local Rule 105.6 (D. Md. 2021). For the reasons set forth below, the Court will grant the Motion to Dismiss as to the ERISA claims and will decline to exercise supplemental jurisdiction over the state law claims.

I. Factual Background

Juric was employed by USALCO as its Chief Financial Officer beginning in November 2014. (Am. Compl. at ¶ 28). Defendant USALCO is a Maryland corporation that engages in the production, marketing, and distribution of aluminum salt chemicals. (Id. ¶¶ 9, 27.) Defendants Peter Askew and Lawrence Askew supervised Juric, and Defendant Kenneth Gayer was the Chief Executive Officer of USALCO and also supervised Juric. (Id. ¶¶ 11-13.) HIG is a Florida corporation that acquired an ownership interest in USALCO. (Id. ¶¶ 10, 61.)

Juric alleges that he identified and raised various legal and ethical issues relating to USALCO's operations throughout his employment. (See e.g., id. at ¶ 61.) He alleges that he was ultimately terminated in January 2021 in retaliation for raising these issues and that his compensation suffered as a result. (See, e.g., id. ¶¶ 99, 102, 148, 196.)

During Juric's tenure, HIG acquired an ownership interest in USALCO. (Id. ¶ 61.) In connection with that transaction:

Mr. Juric was offered the option to invest in Project Aero Management Co-Invest, LLC (the "Co-Invest") and in exchange for his investment he received certain management equity units in the Co-Invest (the "Co-Invest Units"). Mr. Juric also received [redacted] Management Incentive Units in Project Aero Management LLC (the "Management Incentive Units") pursuant to the Project Aero Management, LLC Equity Incentive Plan [("Equity Incentive Plan")] and a grant agreement dated August 3, 2020 (the "Grant Agreement").

(Id. ¶ 180 n.3.) Juric alleges that "[t]he Equity Incentive Plan is an ERISA plan because it provides retirement income to employees and/or results in a deferral of income by employees for periods extending to the termination of covered employment or beyond." (Id. ¶ 23.) Juric also alleges that "Defendants interfered with [his] rights under the Equity Incentive Plan by terminating [him] before his Management Incentive Units had vested and before an expected significant increase in value due to a contemplated merger with a private equity firm." (Id. ¶ 203.)

Juric also alleges that, even after his termination, he was a participant in the USALCO Group Health Benefit Plan ("Health Benefit Plan"), which he likewise alleges is an ERISA-regulated plan. (Id. ¶¶ 19, 22.) Juric alleges that, "[a]s a result of his Co-Invest ownership, [he] was entitled to continued participation in the [Health Benefit Plan] which provided for health and dental coverage as a 'participant' even after [his] termination." (Id. ¶ 212.) He alleges that he was "never given notice of the benefits nor the benefit of that coverage, but was instead provided only with COBRA² information." (Id. ¶ 213.) Juric also alleges that, following his termination, he "requested the status of his coverage and plan documents for the [Health Benefit] Plan, including through a request in writing through counsel on June 14, 2021." (Id. ¶ 214.) He alleges that Defendants did not provide such documents or information. (Id. ¶ 215.)

Juric commenced this action on January 24, 2022 and filed an Amended Complaint on May 9, 2022. (Compl., ECF No. 1; Am. Compl.) Counts I through XI are Maryland common law and Maryland Wage Payment and Collection Law claims. (Am. Compl. ¶¶ 256-337.) Counts XII through XVII are ERISA claims against USALCO and HIG: a claim for benefits under ERISA § 502(a)(1)(b) (Count XII); breach of fiduciary duties (Count XIII); interference under ERISA § 510 (Count XIV); estoppel (Count XV); failure to provide plan documents in violation of ERISA § 502(c); and declaratory judgment (Count XVII). (Id. ¶¶ 338-78.)

II. Legal Standard

When considering a motion to dismiss pursuant to Rule 12(b)(6), the Court must "accept as true all well-pleaded allegations and view the complaint in the light most favorable to the plaintiff." Venkatraman v. REI Sys., Inc., 417 F.3d 418, 420 (4th Cir. 2005). To survive a motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 662, 129 S.Ct. 1937. A "pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.' Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.' " Id. at 678, 129 S.Ct. 1937 (alteration in original) (quoting Twombly, 550 U.S. at 555, 557, 127 S.Ct. 1955).

III. Analysis

Counts XII through XVII of the Amended Complaint purport to state claims under ERISA. Juric fails to state a claim as to each of these Counts, and Defendants' Motion to Dismiss will be granted as to these claims. The remaining claims, Counts I through XI, are Maryland state law claims, over which the Court declines to exercise supplemental jurisdiction and which the Court will dismiss. Accordingly, the Amended Complaint will be dismissed in its entirety.

A. Wrongful Denial of Benefits (Count XII)

Juric's first ERISA claim is a claim for benefits under ERISA § 502(a)(1)(B), codified at 29 U.S.C. § 1132(a)(1)(B). (Am. Compl. ¶¶ 338-45.) Juric alleges that "[u]nder a modification of the [Health Benefit] Plan that was intended to allow the Askews to participate in the benefits of the [Health Benefit] Plan because of their status as unit holders, [Juric] understood that he would also be considered a participant following his termination." (Id. ¶ 341.) He alleges that he was entitled to such continued participation due to his "Co-Invest ownership." (Id. ¶ 212.) Thus, Juric alleges, he was "entitled to benefits under ERISA § 502(a)(1)(B)" and "was wrongfully denied full benefits under the [Health Benefit] Plan." (Id. ¶¶ 343-44.) He explains that he suffered damages, as he was required to pay for COBRA coverage despite his entitlement to coverage under the Health Benefit Plan. (Id. ¶ 345.) Under ERISA § 502(a)(1)(B), a participant in an ERISA plan³ may bring a civil action "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights for future benefits under the terms of a plan." This claim fails and will be dismissed.

Juric has provided no details about what benefits he was allegedly denied. He states only that he was "not provided with the benefits available under the [Health Benefit] Plan" and that he was "wrongfully denied full benefits under the [Health Benefit] Plan." (Am. Compl. ¶¶ 342, 344.) Despite Juric's argument that he has provided "detailed allegations[,]" (Opp'n to Mot. Dismiss at 30, ECF No. 36-1), it is not clear from the Amended Complaint what benefits Juric allegedly did not receive. For this reason alone, he has not adequately pleaded his claim for benefits.

More fundamentally, nothing in the governing Health Benefit Plan document⁴ supports the contention that Juric was entitled to benefits after his termination. The Health Benefit Plan document provides that "[a]n eligible Employee is a person who is classified by the employer on both payroll and personnel records as an Employee who regularly works full-time 30 or more hours per week" (ECF No. 24-12 at 38) and that coverage will end "[t]he day of the month in which Your employment ends." (ECF No. 24-12 at 44.) Nothing in the Health Benefit Plan document provides for continued eligibility after termination. Rather, the Health Plan Document provides for exactly what Juric allegedly received after he was terminated: continued COBRA coverage. (Id. at 46 (providing for up to 18 months of COBRA coverage upon a qualifying event, including that "employment ends for any reason other than Your gross misconduct").)

Juric, however, argues that "[d]uring his employment[,] [he] learned that under a Plan modification that was intended to allow the Askews to participate in the Plan as unit holders, as a Co-Invest unit holder he would also be a participant following his termination, based on, among other things, written assurances" and that "[o]ne of these assurances was an email from USALCO's counsel[.]"⁵ (Opp'n to Mot. Dismiss at 29.) These additional factual details regarding written assurances and an email from counsel appear nowhere in the Amended Complaint and "[i]t is well-established that parties cannot amend their complaints through briefing or oral advocacy." S. Walk at Broadlands Homeowner's Ass'n, Inc. v....