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Faciane v. Sun Life Assurance Co. of Canada

United States District Court, E.D. Louisiana

July 12, 2018


         SECTION I

          ORDER & REASONS


         Before the Court is plaintiff Michael Faciane's (“Faciane”) motion[1] for reconsideration. Faciane requests that the Court reconsider and reverse its grant of summary judgment in favor of defendant Sun Life Assurance Company of Canada (“Sun Life”). For the following reasons, the motion is denied.


         Faciane sustained a work-related injury in June 2006.[2] As a result, he filed a claim for long-term disability benefits under an ERISA-regulated group insurance policy covering Capital One Financial Corporation employees (“the policy”).[3] Sun Life is the policy administrator.[4] Sun Life approved Faciane's claim in March 2008, determining that Faciane “ha[d] been unable to work due to [his] disability effective July 4, 2006, ” and that, under the terms of the policy, his benefits were payable beginning on December 1, 2006.[5]

         Initially, Faciane was approved to receive “a gross benefit of $100.00 (minimum monthly benefit).”[6] In a letter dated March 31, 2008, Sun Life informed Faciane that his claim had been approved and explained how it had calculated the award.[7] Faciane did not administratively challenge the initial calculation of his benefits until June 26, 2017, more than nine years after his claim was approved.[8] On appeal, Sun Life upheld its original calculation, after which Faciane initiated this lawsuit.[9] Sun Life then filed a motion for summary judgment, which the Court granted, dismissing Faciane's claims as untimely.[10]

         Faciane now requests that the Court reconsider its granting of summary judgment in favor of Sun Life on the basis that the Court purportedly “misapplied the law governing the accrual of an ERISA claim based on miscalculation of benefits.”[11]


         The Federal Rules of Civil Procedure do not expressly recognize motions for reconsideration. Bass v. U.S. Dep't of Agric., 211 F.3d 959, 962 (5th Cir. 2000). The question of which procedural rule applies depends on the timing of such a motion. Sentry Select Ins. Co. v. Home State Cty. Mut. Ins. Co., 582 Fed.Appx. 284, 286 (5th Cir. 2014) (quoting Lavaspere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167, 173 (5th Cir. 1990)). A motion for reconsideration filed within twenty-eight days of the district court judgment being challenged is characterized as a motion to alter or amend the judgment and construed pursuant to Rule 59(e). See Id. A motion for reconsideration filed more than twenty-eight days after the judgment is treated as a Rule 60(b) motion for relief from judgment. See id.; see also Morris v. Gulf Coast Rail Grp., Inc., No. 07-5453, 2010 WL 2990069, at *1 (E.D. La. July 26, 2010) (Africk, J.). Faciane filed this motion on June 22, 2018, within twenty-eight days of the Court's order.[12] Accordingly, a Rule 59(e) analysis is appropriate.

         A motion pursuant to Rule 59(e) “calls into question the correctness of a judgment.” Molina v. Equistar Chems. LP, 261 Fed.Appx. 729, 733 (5th Cir. 2008) (citing Templet v. HydroChem Inc., 367 F.3d 473, 477 (5th Cir. 2004)). “Rule 59(e) ‘serve[s] the narrow purpose of allowing a party to correct manifest errors of law or fact or to present newly discovered evidence.'” Templet, 367 F.3d at 479 (quoting Waltman v. Int'l Paper Co., 875 F.2d 468, 473 (5th Cir.1989)). Thus, “a Rule 59(e) motion ‘must clearly establish either a manifest error of law or fact or must present newly discovered evidence' and ‘cannot be used to raise arguments which could, and should, have been made before the judgment issued.'” Schiller v. Physicians Res. Grp. Inc., 342 F.3d 563, 568 (5th Cir. 2003) (citing Rosenzweig v. Azurix Corp., 332 F.2d 854, 863-64 (5th Cir. 2003)). “Reconsideration of a judgment after its entry is an extraordinary remedy that should be used sparingly.” Templet, 367 F.3d at 479 (citation omitted).


         In his present motion, Faciane characterizes the Court's order granting summary judgment in favor of Sun Life as a “misappli[cation] of the governing law.”[13]Specifically, Faciane contends that the Court erred in concluding that his claim for miscalculated benefits accrued “when there [was] enough information available to [him] to assure that he [knew] or reasonably should [have known] of the [alleged] miscalculation.”[14] In support of his position, Faciane relies exclusively-and for the first time-on the Ninth Circuit's opinion in Withrow v. Halsey.[15] Based on Withrow, Faciane argues that his claim did not in fact accrue until September 2017 and that, as a result, his lawsuit was timely.[16]

         In response, Sun Life argues that Faciane has not met the Rule 59(e) standard because his motion is “based on an extra-circuit, non-binding case that [Faciane] had every opportunity to cite prior to this Court's entry of judgment.”[17] According to Sun Life, any reconsideration of the Court's order based on Faciane's presentation of a new case “is an affront to the finality principles that underlie Fifth Circuit jurisprudence.”[18] Additionally, Sun Life argues that, because Withrow is not binding on the Court, the Court's grant of summary judgment does not constitute a “manifest error of law” that would warrant reconsideration.[19]

         Faciane implores the Court to reconsider its prior ruling based on the presentation of new case law, but a motion for reconsideration “is not the proper vehicle for rehashing . . . legal theories[] or arguments that could have been offered or raised before the entry of judgment.” Templet, 367 F.3d at 478-79; see also Namer v. Scottsdale Ins. Co., 314 F.R.D. 392, 395 (E.D. La. April 5, 2016) (Africk, J.) (quoting LeClerc v. Webb, 419 F.3d 405, 412 n.13 (5th Cir. 2005)) (“A motion for reconsideration may not be used to rehash rejected arguments or introduce new arguments.”).

         Faciane has already had multiple opportunities to brief the Court on the issue of when a claim for the miscalculation of benefits accrues under ERISA. Sun Life first raised the issue in its motion for summary judgment filed on April 2, 2018.[20] In his response, Faciane urged the Court to reject the clear repudiation rule and cited cases to support his argument that a miscalculation claim does not accrue until a benefits recipient challenges the original calculation and is informed that the calculation was correct.[21] Faciane then filed a second opposition to the motion for summary judgment over one month later. In that opposition, he did not provide any additional information or cite new cases regarding the issue of accrual and the clear repudiation rule.[22] In fact, neither filing mentions Withrow.

         Faciane has never cited or discussed Withrow until now, but Withrow was not decided in the interim period between the Court's grant of summary judgment and Faciane's motion for reconsideration.[23] Withrow has been available to Faciane during the entire course of this litigation. If Faciane believed Withrow to be the most compelling case to persuade the Court to adopt the Ninth Circuit's approach, he should have brought the case to the Court's attention before the Court ruled on the motion for summary judgment.

         In short, Faciane argues that the Court should reevaluate its previous decision embracing the Second and Third Circuits' reasoning and ultimately applying the Second Circuit's standard. After determining that the Fifth Circuit had not yet established a clear rule with respect to the accrual of a benefits miscalculation claim under ERISA, the Court evaluated the case law in circuits that have addressed the issue. The Court ultimately concluded that the rationale behind the Second and Third Circuits' substantially similar approaches was the most compelling. Faciane now argues that the Court should reverse course. The Court declines to do so.


         Faciane also argues that Miller v. Fortis Benefits Insurance Co.-a Third Circuit case the Court discussed in its original order-“has no application in the present matter.”[24] The Court disagrees. The Court ultimately applied the Second Circuit's test; however, applying either the Second or the Third Circuit's standard for the accrual of a benefits miscalculation claim under ERISA, Faciane's claim is time-barred.[25]


         Under the Third Circuit's approach in Miller, “an erroneously calculated award of benefits under an ERISA plan can serve as ‘an event other than denial' that triggers the statute of limitations, as long as it is (1) a repudiation (2) that is clear and made known to the beneficiary.” Miller v. Fortis Benefits Ins. Co., 475 F.3d 516, 521 (5th Cir. 2007). According to Faciane, the language in Sun Life's March 2008 letter approving his claim for benefits cannot constitute a repudiation that was “clear” or “known” to him.[26] Specifically, he refers to portions of the letter in which Sun Life explains that his benefits were calculated “based on the information [Sun Life had] currently in [his] file.”[27] Faciane argues that his claim for adjusted benefits had not been repudiated under the Miller standard because “the language . . . indicates that not even Sun Life had made a final determination concerning the appropriate calculation of [his] benefits.”[28]

         However, Faciane misstates the clear repudiation rule, which requires a repudiation of the beneficiary's rights, not his claim for adjusted benefits. See, e.g., id. at 521 (“[A]n underpayment is adverse to the beneficiary and therefore repudiates his rights under a plan.”). Miller directly addressed erroneous calculations, characterizing any underpayments resulting from a miscalculation as “effectively a partial denial of benefits” constituting “a repudiation.” Id. With respect to the second prong, “repudiation by underpayment should ordinarily be made known to the beneficiary when he first receives his miscalculated benefit award.” Id. (citation omitted). “At that point, the beneficiary ...

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