United States District Court, W.D. Louisiana, Shreveport Division
HORNSBY MAGISTRATE JUDGE
ELIZABETH ERNY FOOTE JUDGE
underlying action, Plaintiff seeks to recover life insurance
benefits from United of Omaha Life Insurance Company
("United"). Plaintiffs late husband, Donald Swenson
("Swenson") was employed by Eldorado Casino
Shreveport Joint Venture ("Eldorado") and allegedly
participated in Eldorado's ERISA-governed life insurance
plan administered by United. United has brought a third-party
complaint against Eldorado, which Eldorado has moved to
dismiss. [Record Documents 18 at 29-32 and 23]. Because the
facts alleged do not entitle United to indemnity,
Eldorado's motion is GRANTED as to
United's indemnity claim. However, because United has
alleged that Eldorado negligently represented Swenson's
eligiblity for coverage, the motion is
DENIED as to United's claim for defense
Court has amply discussed the factual and procedural
background in its prior rulings in this matter. See
Swenson v. Eldorado Casino Shreveport Joint Venture (Swenson
I), No. 15-CV-2042, 2017 WL 1334307 (W.D. La. Apr. 7,
2017), affdsub nom. Swenson v. United of Omaha Life Ins.
Co., 876 F.3d 809 (5th Or. 2017); Swenson I,
No. 15-CV-2042, 2016 WL 6106483 (W.D. La. Oct. 19, 2016);
[Record Document 35 in No. 15-CV-2042]. After Swenson's
death, United denied Plaintiffs life insurance claim,
asserting that Swenson was ineligible and that United
received no premiums for his coverage. [Record Document 1-2
at 1]. After Plaintiff sued United and Eldorado,
Court dismissed her state-law and equitable claims with
prejudice and dismissed her claim for benefits under 29
U.S.C. § 1132(a)(1)(B) without prejudice for failure to
exhaust her administrative remedies. Swenson I, 2017
WL 1334307, at *4-5, *7. While an appeal was pending,
Plaintiff settled with Eldorado. [Record Document 23-1 at 9].
The Fifth Circuit then affirmed this Court's dismissal of
Plaintiff s state-law and equitable claims. Swenson
I, 876 F.3d 809.
her unsuccessful appeal, Plaintiff brought the present
action. [Record Document 11]. In its answer, United named
Eldorado as a third-party defendant, alleging that Eldorado
knew that Swenson was ineligible for life insurance coverage
because he was not actively working and failed to share this
information with United when submitting premiums on
Swenson's behalf. [Record Document 18 at 31]. On the
basis of Eldorado's alleged duty to "inform [United]
who was and was not eligible" for benefits, United seeks
indemnification if "United ... is held liable to the
plaintiff for any sums whatsoever because of Eldorado's
breach of fiduciary duty to Donald Swenson."
[Id. at 32]. United has also alleged that
"Eldorado is liable to United... for all defense costs
incurred in connection with this matter by United... because,
if Eldorado had informed United that Donald Swenson was never
eligible for coverage under this policy, United would not be
facing these claims and demands . . . ." [Id.].
Eldorado responded with the instant motion, which denies any
legal basis for indemnity as well as any duty to inform
United of employees' eligibility for benefits. [Record
Document 23]. The parties have filed an opposition, a reply,
and a surreply. [Record Documents 27, 28, 33].
Law and Analysis
Standard of Review
order to survive a motion to dismiss under Rule 12(b)(6), a
complaint must "state a claim to relief that is
plausible on its face." Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (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."
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Twombly, 550 U.S. at 556). In determining whether a
complaint states plausible claim, the court must construe the
complaint in the light most favorable to the plaintiff,
see In re Great Lakes Dredge & Dock Co., 624
F.3d 201, 210 (5th Cir. 2010), and accept as true all
well-pleaded factual allegations, see Twombly, 550
U.S. at 555; In re Katrina Canal Breaches Litig.,
495 F.3d 191, 205 (5th Cir. 2009). However,
"[t]hreadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not
suffice." Iqbal, 556 U.S. at 678 (citing
Twombly, 550 U.S. at 555). Thus, the Court does not
have to accept as true "conclusory allegations,
unwarranted factual inferences, or legal conclusions."
Plotkin v. IP Axess Inc, 407 F.3d 690, 696 (5th Cir.
2005) (citing Southland Sec. Corp. v. INSpire Ins. Sols,
Inc., 365 F.3d 353, 361 (5th Cir. 2004)).
Indemnity Resulting from Eldorado's Alleged Fiduciary
Duty to United
has alleged that Eldorado "breached its fiduciary duties
to [United]" by failing to inform United that Swenson
was not actively working and was ineligible for coverage and
by submitting premiums on his behalf. [Record Documents 18 at
30-32 and 27 at 15]. United asserts that if Eldorado had not
breached this alleged duty by submitting an application for a
person that Eldorado knew was ineligible for coverage, United
would not have been sued; United therefore concludes that
Eldorado is liable for United's defense costs and any
sums for which United is held liable to Plaintiff. [Record
Documents 18 at 31-32 and 27 at 15-17]. Eldorado argues that
under ERISA an employer has no fiduciary duty to an insurer
and that because United, not Eldorado, makes eligibility
determinations, Eldorado had no duty prior to a claim being
made to inform United whether Swenson was actively working.
[Record Document 23-1 at 12-14]. As the plan administrator,
[Record Document 1-2 at 72], Eldorado has a fiduciary duty to
Swenson, see 29 U.S.C. § 1002(14)(A), (2l)(A)
(2012); Wildbur v. ARCO Chem. Co., 974 F.2d 631, 645
(5th Cir. 1992). Because a "plan fiduciary's
responsibilities run only to participants and beneficiaries,
" Boggs v. Boggs, 520 U.S. 833, 850 (1997)
(citing 29 U.S.C. § 1104(a)(1) (2012)), and because
United is neither a participant nor a beneficiary, Eldorado
does not have a fiduciary duty to United. Therefore, United
cannot claim indemnity on the basis of this alleged duty.
Indemnity Resulting from Eldorado's Fiduciary Duty to
has alleged that Eldorado breached its fiduciary duty to
Swenson by accepting an enrollment form from him and paying
premiums on his behalf and for that reason must indemnify
United if United is held liable to Plaintiff. [Record
Document 18 at 30-32]. Eldorado argues that there is no right
of indemnity under ERISA. [Record Document 23-1 at 11-14].
their respective roles as plan administrator and claims
administrator, [Record Document 1-2 at 65, 72], both Eldorado
and United owed Swenson fiduciary duties, see 29
U.S.C. § 1002(14)(A), (21)(A); Sanders v. Unum Life
Ins. Co. of Am.,553 F.3d 922, 925 (5th Cir. 2008);
Wildbur,9774F.2d at 645. Under the common law of
trusts from which ERISA derives, two co-fiduciaries, both of
whom have participated in a breach of trust, may obtain
contribution or indemnity. See Cent. States, Se. &
Sw. Areas Pension Fund v. Cent. Transp., Inc., 472 U.S.
559, 570 (1985); Restatement (Third) of Trusts § 102(1)
& cmt. b(2) (2012). The Seventh and Second Circuits have
held that ERISA co-fiduciaries have a right to indemnity or
contribution,  while the Eighth and Ninth Circuits deny
ERISA co-fiduciaries these remedies. Compare Chesemore v.
Fenkell,829 F.3d 803 (7th Cir. 2016) and Chemung
Canal Trust Co. v. Sovran Bank/Md.,939 F.2d 12 (2d Cir.
1991) with Travelers Cas. & Sur. Co. of Am. v. IADA
Sews., Inc.,497 F.3d 862 (8th Cir. 2007) and Kim v.
Fujikawa,871 F.2d 1427 (9th Or. 1989). District courts
in the Fifth Circuit are split. Compare Maher v. Strachan
Shipping Co.,817 F.Supp. 43 (E.D. La. 1993) (finding
indemnity and contribution rights) within re Enron Corp.
Sees., Derivative, & "ERISA" Litig., 228