1 Employee Retirement Income Security Act of 1974, 29 U.S.C.

§§ 1001 et seq.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 94-40263

LLOYD SWITZER,

Plaintiff-Appellee,

versus

WAL-MART STORES, INC.,

Defendant-Appellant.

Appeal from the United States District Court

For the Eastern District of Texas

(May 12, 1995)

Before WISDOM, WIENER and PARKER, Circuit Judges.

WIENER, Circuit Judge.

In this ERISA 1 case Defendant-Appellant Wal-Mart Stores, Inc.

(Wal-Mart), in its capacity as plan administrator of the Wal-Mart

Stores, Inc. Health Benefit Plan (the Wal-Mart Plan), appeals from

an adverse ruling of the district court ordering it to reconsider

Plaintiff-Appellee Lloyd Switzer's claimed medical expenses. The

district court, after acknowledging that a lapse in Switzer's

health insurance cover age precluded him from obtaining a l egal2 Consolidated Omnibus Budget Reconciliation Act of 1985, 29

U.S.C. §§ 1161-68.

3 Switzer's first COBRA payment, made on December 27, 1990,

covered a period from September 8, 1990 through January 31, 1991.

All of his subsequent payments, however, were made on a monthly

basis.

2 rem edy, nevertheless concluded that Wal-Mart was "arbitrary and

capricious" in denying Switzer's claims and proceeded to fashion a

so-called equi table remedy to achieve the result that the court

found proper under the circumstances. Concluding that the court

clearly erred in factual determinations upon which this case turns

and erred as a matter of law in holding that Wal-Mart's denial of

Switzer's claims was "arbitrary and capricious," we are constrained

to reverse its ruling, vacate its judgment, and render a takenothing judgment against Switzer.

I

FACTS AND PROCEEDINGS

Switzer went to work for Wal-Mart in 1988, where he became a

participant in the Wal-Mart Plan. His participation, and thus his

health insura nce coverage, ceased automatically when he quit his

job with Wal-Mart in September 1990. Switzer elected to take out

a COBRA 2 continuation policy of health insurance under the Wal-Mart

Plan, doing all that was necessary to obtain such coverage and

thereafter to maintain it--from the inception through the calendar

month ending August 31, 1991-- by timely remitting the full amount

of each monthly premium payment by personal check. 3

During the few months a fter Switzer left his Wal-Mart job,

Wal-M art made several administrative errors in connection with3

winding up his coverage under the Wal-Mart Plan, improperly

deducting insurance premiums from Switzer's accrued vacation pay.

Wal-Mart reversed those incorrect deductions by the end of January

1991, however, and the errors have no direct bearing on Switzer's

ensuing h ealth insurance difficulties, except to the extent that

they figured into the district court's determination that Switzer

was justified in believing that Wal-Mart had a propensity for

making such mistakes in administering its insurance plan.

Effective June 21, 1991, Switzer was rehired by Wal-Mart. As

his prior employment termination in September 1990 constituted a

true break in service and not a leave of absence, his return in

June 1991 was tantamount to new employment and he was deemed a "new

hire" under the Wal-Mart Plan. He was therefore subject to a 90-

day waiting p eriod before his re-enrollment in the Wal-Mart Plan

could become effective. Switzer was aware of the delay in coverage

under the Wal-Mart Plan resulting from that waiting period and of

his need to maintain his COBRA coverage by making timely monthly

premium payments until his regular coverage under the Wal-Mart Plan

recommenced.

In addition to having rec eived a summary plan description

(SPD) detailing COBRA in ordinary, conversational language, Switzer

was g iven, and had in his possession at all pertinent times, a

monthly coupon book for his COBRA policy. The coupon for the month

of September 1991 specified that a premium payment of $82.46 was

due and payable on August 28, 1991. It also reflected that Switzer

was entitled to a grace period of 30 days, and that the August 28th4 The record reflects that Switzer had his wife handle these

insurance matters, albeit in co nsultation with him, and that she

had experienc e with insurance policies, having worked in the

insurance business for some 15 years and even having owned her own agency at one time.

5 Wal-Mart contends that it questioned whether Switzer had a

right to prorate the payment and indicated its position to the

district court. We find that resolution of the proration issue is

not required for purposes of this appeal.

4 payment would be past due on September 27, 1991 SQ the last day of

the grace period. The coupon contained the following statement:

"IF PAYMENT IS NOT RECEIVED IN OUR OFFICE ON

OR BEFORE PAST DUE DATE, COVERAGE W I LL BE

CANCELLED ON DATE LAST PAID."

Switzer never remitted the August 28, 1991, payment, in whole or in

part; he also did not remit any other payment thereafter. The last

monthly payment that he made on his COBRA coverage was the one that

was due late in July. Switzer paid it by check on July 26th,

maintaining his COBRA coverage in full force and effe ct only

through August 31, 1991. 4

Calculated on the basis of his re-employment date of June 21,

1991, Switzer's 90-day waiting period for coverage under the WalMart Plan expired approximately three-fou rths of the way through

the period of his September COBRA coverage, before Switzer's COBRA

coverage lapsed automatically on September 27th--effective

retroactively to August 31st--due to non-payment. Apparently

concluding that the premium for that fractional period was subject

to proration, the district court found that Switzer's final

September COBRA payment should have been approximately $60 for that

partial month, not the full $82.46 reflected on the coupon. 56 We note that by October 4, 1991, Switzer's COBRA coverage had

already lapsed (effective retroactively to Au gust 31, 1991) by

virtue of his failure to pay his August 28th premium by September

27th, the last day of the 30-day grace period.

5 On Oct ober 4, 1991, Wal-Mart deducted a medical insurance

premium from Switzer's regular monthl y paycheck S Q the first

deduction following Switzer's re-employm e nt at Wal-Mart. The

ded uction covered Switzer's initial, partial period of renewed

coverage under the Wal-Mart Plan, from his initial eligibility date

of September 21, 1991 through October 4, 1991, the beginning of his

first full month of coverage.

Also und er date of October 4, Wal-Mart sent Switzer a

computer-generated letter, which he received shortly thereafter.

The letter informed him that his COBRA coverage would be canceled

retroactively, effective to August 31, 1991, if he did not remit,

by October 16, 1991, the $82.46 premium payment SQ an amount equal to

a full month's COBRA premium SQ that had been due on August 28, 1991

and had bec ome past due on September 27, 1991. In addition to

stating that cancellation of his COBRA coverage would be effective

retroactively to August 31, 1991, the letter advised that canceled

coverage could not be resumed. 6

Despite the obviously important nature of that information,

Switzer elected to make no payment whatsoever. He also elected not

to contact anyone at Wal-Mart about the October 4th letter or about

the COBRA payment to which the letter referred. Rather, he took it

upon himself, with the counsel of his wife only, to conclude

(erroneously) that, inasmuch as his final COBRA period was a6

partial month and the figure mentioned in the letter was equal to

a full month's premium, the delinquent payment referred to in the

letter must ha ve been covered by Wal-Mart's October 4th payroll

deduction. Switzer came to this incorrect conclusion without

inquiring about his misinterpretation, despite the fact (as found

by the district court) that he was consciously intere sted in

maintaining uninterrupted health insurance coverage.

Switzer had a known heart condition which constituted a preexisting condition under the Wal-Mart Plan. That plan provided

that all pre-existing conditions were excluded from coverage until

the plan participant had been continuously covered for twelve

consecutive months. Thus, to avoid any lapse in coverage

triggering the Wal-Mart Plan's one- year exclusion for his preexisting heart condition by creating a "new" starting date for his

coverage under that plan, Switzer had to maintain his COBRA

coverage in effect until September 21, 1991, ninety days after his

re-employment at Wal-Mart on June 21, 1991. Quite simply, if

Switzer maintained continuous coverage from one plan to the other,

the heart condition would have been covered continuously through a

combination of the two plans; but if the COBRA coverage lapsed

before his Wal-Mart Plan coverage began, the Wal-Mart Plan's oneyear exclusion of pre-existing conditions from co v erage would

exclude Switzer's heart condition from coverage between August 31,

1991 (the end of COBRA coverage) and September 21, 1992 (the end of

the Wal-Mart Plan's one-year exclusion period).

O n February 20, 1992 S Q during the exclusion period for pre-7

exi sting conditions under the Wal-Mart Plan S Q Switzer suffered a

heart attack. His medical bills exceeded $50,000. As Plan

Administrator, Wal-Mart considered but denied Switzer's claims for

medical costs and expenses. Wal-Mart denied his claims based on

the lapse, effective retroactively to August 31, 1991, of Switzer's

COBRA coverage resulting from his non-payment of the September 1991

COBRA premium, and the Wal-Mart Plan's one-year exclusion of preexisting conditions from coverage.

After ex hausting his administrative remedies to no avail,

Switzer filed suit in state court seeking reimbursement of medical

expenses from the Wal-Mart Plan. Based on ERISA's preemption, WalMart removed the suit to the federal district court , which

conducted a bench trial.

The district court found that Wal-Mart, by voluntarily

assuming a duty to inform Switzer of his impending lapse of COBRA

coverage in a manner that the court believed to be ineffective and

confusing, had breached its fiduciary duty to Switzer to provide

him with clear and accurate information. In its ruling, the

district court acknowledged that Wal-Ma rt had no duty to inform

Switzer of th e impending lapse in his COBRA health insurance

coverage. Nonetheless, the court took the position that if a plan

administrator decides, in the absence of a duty to do so, to notify

a plan participant of an impending loss of coverage, it must make

certain, by clearly communicating to the participant, that the

participant abandoning coverage does so knowingly and

intentionally.8

In holding that Wal-Mart's communication to Switzer was not

adequate, the court referred specifically to Wal-Mart's letter of

October 4, 1991, which stated that Switzer needed to pay $82.46

rather than a prorated amount estimat ed to be approximately $60.

In light of Wal-Mart's past errors in administering Switzer's

coverage, the court reasoned, Switzer was entitled to a more

thorough explanat ion from Wal-Mart, summarizing his payments and

advising him expressly of the need to avoid the impending threeweek gap in coverage. The district court believed that the notice

from Wal-Mart to Switzer did not make sufficiently clear that the

delinquent COBRA payment was unrelated to the premium that Wal-Mart

had deducted from Switzer's paycheck on October 4, 1991, for his

coverage under that plan commencing September 21, 1991. The court

also concluded that Wal-Mart's letter shoul d have clarified the

mea ning of the October 16th payment deadline for Switzer's

delinquent COBRA paym ent and that deadline's relationship to the

original September 27th past due date.

Recognizing the unavailability o f a legal remedy to achieve

the result it deemed appropriate under the circumstances, the

district court crafted an "equitable" remedy: It ordered Wal-Mart

to accept a late payment from Switzer, thereby retroactively curing

his failure to pay the final COBRA premium and eliminating the gap

between his COBRA and Wal-Mart Plan coverages, and ordered Wal-Mart

to reconsider Switzer's claims for medical expenses that resulted

from his heart problems. Wal-Mart timely filed a notice of appeal,

and this review ensued.7 S ee Crisis Transp. Co.v.M/V Erlangen Express

, 794 F.2d 185,

187 n.5 (5th Cir. 1986).

8 See id.

9 S ee First United Fin. Corp. v. Specia lty Oil Co. , 5 F.3d

944, 947 (5th Cir. 1993) (citing Anderson v.City of Bessemer City

, 470 U.S. 564, 574 (1985)).

1 0 See Anderson v. City of Bessemer City , 470 U.S. 564, 573

(1985); United States v. United States Gypsum Co.

, 333 U.S. 364,

395 (1948).

1 1 S ee Firestone Tire and Rubber Co. v. Bruch

, 109 S. Ct. 948,

956-57 (1989).

9 III

ANALYSIS

A. Standard of Review

We re view a judgment on the merits of a nonjury civil case

applying the usual standards of review. 7 Thus, we review

conclusions of law de novo a n d findings of fact for clear error. 8

If the district court's account of the evidence is plausible in

light of the record viewed in its entirety, we may not reverse even

if we are convinced that, had we been sitting as the trier of fact,

we would have weighed the evidence dif ferently. 9 Nevertheless, a

trial court's finding is "clearly erroneous" when, although there

is evidence to support the finding, the reviewing court is left

with a definite and firm conviction that a mistake has been made. 10

Although we generally review de novo the deni al of benefits

under an ERISA health plan, 11 when the plan administrator is vested

with discretionary authority to construe the terms of the plan and

determine eligibility for benefits SQ as was Wal-Mart SQ the decisions

of the plan adm inistrator can only be reversed if found to be1 2 S ee id. ; Vasseur v. Halliburton Co.

, 950 F.2d 100 2, 1006

(5th Cir. 1992).

1 3 S ee Bolling v. Eli Lilly & Co. , 990 F.2d 1028, 1029 (8th

Cir. 1993).

10 arbitrary and capricious. 12 We review de novo the district court's

conclusion that the plan administrator's determinations were

arbitrary and capricious. 13

B. Wal-Mart's Letter to Switzer

As a starting point, we agree with the district court that

Wal-Mart as plan administrator was not legally or contractually

bound to inform Switzer that he was late in remitting his final

COBRA premium. And we do not necessarily disagree with the

implication that if and when a plan administrator thus elects to

act as a Good Samaritan and S Q without prior inquiry from th e

participant SQ

gratuitously communicate with a plan participant about

such a matter, the administrator must do so in a manner calculated

to avo id confusion and misunderstanding, whether by omission or

commission. It is at this point, however, that we part company

with the district court.

First, the district court suggests that for ERISA purposes the

instant situation was other t han routine. That is clearly

erroneous: Wal-Mart is not exactly your typical Mom and Pop

operation; we speculate that among its tens of thousands of

employees, many miss such payments every month SQ some intentionally

and others inadvertently. Only by computer can the myriad employee

benefit matters of such a giant employer be monitored. Thus by

definition, Wal-Mart could not possibly give personalized attention1 4 9 F.3d 445, 451-52 (6th Cir. 1993) (holding that plan

administrator did not breach its fiduciary duties where it had

adequ ately explained plan contents, and employee had failed to

inquire about plan term that he misinterpreted on his own).

1 5 3 F.3d 986, 991-92 (7th Cir. 1993) (holding that

fiduciaries breached their duties by not giving benef iciary full

and complete information).

16 See Electro-Mechanical Corp. , 9 F.3d at 452.

17 See id. at 451.

11 to each and every employee. To conclude that Wal-Mart should have

known, in the absence of an inquiry from Switzer, that he did not

want his COBRA coverage to lapse before his coverage under the WalMart Plan recommenced is to ignore the realities of the situation.

Wal-Mart's form letter to Switzer regarding his delinquent

COBRA premium payment was not sent in response to an inquiry from

Switzer; he never bothered to initiate one. In addition, no one

has questioned the accuracy of the dates or time limits set forth

in that letter. Consequently, the district court's reliance on

Electro-Mechanical Corp. v. Ogan

, 14 and Anweiler v. American Elec.

Power Serv. Corp.

, 15 to impose a higher duty of promptness and

adequacy on Wal-Mart in connection with that communication to

Switzer is misplaced. Electro-Mechanical Corp. makes clear that,

absent a specific participant-initiated inquiry, a plan

administrator does not have any fiduciary duty to determine whether

confusion about a plan term or condition exists. 16 It is only after

the plan administrator does receive an inquiry that it has a

fiduciary obligation to respo nd promptly and adequately in a way

that is not misleading. 1712

Regard less of the level of the plan administrator's duty,

however, the court's finding that Wal-Mart's communication did not

provide sufficiently clear and accurate information to Switzer

concerning the status of his COBRA coverage is clearly erroneous.

Remember, Switzer knew and understood that his coverage under the

Wal-Mart Plan would not clutch in until September 21, 1991, 90 days

after he rejoined Wal-Mart as an employee. Additionally, he still

had in his possession the premium coupon book (and presumably the

SPD) for his COBRA coverage, had used those coupons during the

period of his unemployment and for the first two months following

his re-employment, and had in han d the particular premium coupon

for the payment in question. That coupon clearly and unambiguously

reflected the billing period that it covered (September 1-30,

1991), the date by which the premium was due (August 28, 1991), the

date on which that payment would be past due (September 27, 1991),

and the fact that if such payment were not received by Wal-Mart on

or before the past due date, Switzer's COBRA coverage would be

ca nceled automatically as of August 31, 1991 S Q the last date for

which he had made premium payments and a date of which Switzer was

quite clearly aware.

With that in mind we also find significant that which the

record reflects did not occur: Despite Switzer's conceded

knowledge that he had to keep his COBRA coverage in effect at least

through September 21, 1991 and that his prior premium payments kept

his coverage alive only through August 31, 1991, Switzer made a

conscious decision not to remit the payment reflected on the coupon1 8 Even though Switzer contends that he also misinterpreted

the statement on the premium coupon, "Grace period for this bill is

30 days," as meaning it would run from either the past due date of

September 27th or the billing period expiration of September 30th,

it is clear that Switzer took it upon himself to make that

interpretation and, as with the other matters, initiated no

inquiries to the plan administrator or anyone else to clear up his

own confusion.

13 as being due on August 28; he did not pay on that date, or on the

specified past due date of September 27, or on any date in between.

Significantly, Switzer's decision not to pay the premium that was

due on August 28 could not have been affected by Wal-Mart's October

4th notice; it came far too late for that!

Switzer likewise made a conscious decision not to initiate any

inquiries to Wal-Mart indicating his concern or confusion SQ he did

not inquire about whether he had to make a payment, about whether

the payment could be prorated for a lesser amount, or about

anything else regarding his coverage. So, in light of all of his

knowledge and his interest in avoiding a gap in coverage, Switzer

overtly considered his options and elected to take no action, make

no inquiries, and allow the past due date to come and go, knowingly

disregarding the premium coupon's statement that "coverage will be

cancelled on date last paid." 18

In fact, when Wal-Mart sent its October 4, 1991 form letter to

Switzer, his COBRA coverage had already lapsed! It was a pure act

of grace, then, for Wal-Mart to allow l ife to be breathed into

Switzer's moribund COBRA policy, thereb y avoiding a gap between

that coverage and Switzer's Wal-Mart Plan coverage, by extending

from September 27th to October 16th the time in which Switzer could14

still remit the premium that had been due on August 28th and had

become delinquent on September 27th. The district court did not

acknowledge the difference between a voluntary notice of impending

COBRA coverage lapse sent at a time b efore the lapse occurs, and

the insta nt situation in which Wal-Mart's gratuitous October 4th

notice was sent after the time for premium payment had passed.

Switzer's COBRA policy had presumably terminated ipso facto before

Wal-Mart sent its letter in effect offering a re-opening of the

expired grace period. The full content of the October 4th letter

bears reproduction here:

DEAR LLOYD SWITZER,

THIS NOTICE IS TO INFORM YOU THAT YOUR

CONTINUATION COVERAGE COBRA WILL BE CANCELLED

IF FULL PAYMENT IN THE AMOUNT OF $82.46 IS NOT

RECEIVED IN OUR OFFICE POSTMARKED ON OR BEFORE

10/16/91.

THIS CANCELLATION WILL BE EFFECTIVE AT 12:00

MIDNIGHT ON THE LAST DAY THROUGH WHICH

COVERAGE HAS BEEN PAID, 08/31/91. CANCELLED

COVERAGE CANNOT BE RESUMED. NO OTHER NOTICE

OF DISQUALIFICATION WILL BE SENT.

SINCERELY,

WAL-MART CONTINUATION COVERAGE

We find that Wal-Mart's communication to Switzer was clear and

unambiguous. The only conceivably questionable item in the entire

communication is the amount of the premium, $82.46, and even that

corresponds, to the penny, with the premium amount set forth on

Switzer's premium coupon. That figure can be deemed ambiguous or

misleading only if one adverts to the de minimis premium difference

p roduced by the putative (and, by Wal-Mart, questioned) right to15

proration. Besides, the law does not require a perfect

communication, only one that is sufficiently clear and complete to

avoid the labels of inadequate, ambiguous, confusing or misleading.

That lawyers or judges might improve on the notice or nitpick it

here or there does not necessarily subject it to such pejorative

appellations. It need not be "the best" as long as it is

reasonably clear and understandable. Wal-Mart's October 4th letter

is at least that.

Despite Switzer's receipt of that letter and its obviously

crucial importance to him S Q importance which, the district court

found, Switzer appreciated and was concerned about SQ he neither

remitted the payment of $82.46 or any lesser amount nor contacted

Wal-Mart to inquire about any perceived discrepancies between the

full amount of the monthly premium and his estimate of an

approximate prorated amount. Switzer never inquired about the

extended but different period within which he now could remit the

payment, about any possible nexus between the letter's warning and

the insurance deduction from his first paycheck (we can but wonder

why his belief that he was entitled to proration of his last COBRA

premium appar ently did not provoke a similar thought process

regarding proration of the September 21-October 4 fractional month

for which Wal-Mart made a payroll deduction for insurance under its

plan), or about anything else that would help him determine the

status of his health insurance coverage under both COBRA and the

Wal-Mart Plan within the extended grace period.

The district court found that Swi tzer and his wife16

"conscientiously attempted to maintain uninterrupted health

coverage." We cannot square that finding with Switzer's rather

cavalier "do nothing" behavior during the period of several months

between the time he remitted the penultimate COBRA premium on July

26, 1991 and the expiration of his extended grace period on October

16, 1991 SQ

a time span during which his 90-day waiting period under

the Wal-Mart Plan expired, his premium coupon for his ultimate

COBRA premium went unused, and the past due date of September 27th

for that premium (on which date the 30-day grace period expired)

came and went. The tragic truth is that this portrays a terribly

regrettable example of one who snatches defeat from the jaws of

victory; the tragedy, however, cannot be laid at Wal-Mart's feet in

this instance.

C. Wal-Mart's Denial of Switzer's Claims

The district court acknowledged the highly deferential

"arbitrary and capricious" standard under which it was compelled to

review the Pl an Administrator's decision to deny benefits to

Switzer. We review that court's determination de novo. Given the

court's express recognition that there was a lapse in coverage and

that the lapse was the direct result of Switzer's conscious

decision not to pay the final COB RA premium, we find

incomprehensible its conclusion that the plan administrator's

denial of benefit s was "arbitrary and capricious." The district

court justified that holding, however, by concluding that Wal-Mart

"attempted" to notify Swi tzer about the unpaid September premium

but that Wal-Mart "failed to get its message across." We must19 29 U.S.C. § 1022(A)(1) (outlining requirements for plan

descriptions).

17 again respectfully disagree.

Switzer received Wal-Mart's mailing, written in c lear and

unambiguous terms. Unfortunately, he made a conscious, deliberate

decision to ignore it or at least to refrain from acting on it.

His doing that cannot be said to prove that Wal-Mart "failed to get

the message across." We discern nothing in S Q or omitted from SQ

WalMart's Octobe r 4th letter that could put into play a chain of

events justifying that the end result, i.e., the plan

administrator's denial of benefits, should be labeled "arbitrary

and capricious."

To force Wal-Mart SQ or, more correctly, the other participants

whose premium burdens would ulti mately increase if the Wal-Mart

Plan were to pay an unwarranted claim SQ to accept Switzer's nevertendered 199 1 COBRA premium now, and thereby resuscitate Switzer's

coverage and Wal-Mar t Plan's financial responsibility for his

medical claims, would truly be to confirm the adage, "No good deed

goes unpunished." Not only did Wal-Mart act as a prudent fiduciary

by furnishing, gratis, an extra notice and an extra couple of weeks

within which to remit that all-important, final COBRA premium, it

did so in a factually faultless manner. Its October 4th letter to

Switzer was adequate and "written in a manner calculated to be

under stood by the average plan participant." 1 9 When competent

majors such as Switzer knowingly and intentionally elect to act SQ or

not to act SQ in a particular way in response to reasonable stimuli,2 0 29 U.S.C. § 1104(a)(1)(D) (describing fiduciary duties).

21 Id.

18 they alone must accept responsibility for their own acts or

abstentions. We cannot forever seek S Q and find SQ

a deep pocket to

ameliorate the regrettable results of a plaintiff's own unfortunate

mistake.

The district court was clearly erroneous in its factual

determination that Wal-Mart's actions, particularly its notice of

October 4, 1991, were inadequate, misleading, confusi ng, or

otherwise deficient in any manner. That error of fact caused the

district court to err reversibly in holding SQ on the basis of such

findings SQ that Wal-Mart as the plan administrator was arbitrary and

capricious in rejecting Switzer's claims for me d ical expenses

arising from or connected with his pre-existing heart condition and

subseq uent heart attack. Section 1104(a)(1)(D) of ERISA 2 0 is a

mandate to plan administrators to act "in accordance with the

documents and instruments governing the plan" 21 SQ here,the Wal-Mart

Plan description, the SPD, and possibly the premium co upon too.

Given the universally acknowledged fact that under these relevant

documents and instruments, Switzer's failure to pay the September

COBRA premium caused his coverage to lapse as of August 31, 1991,

triggering the one-year exclusion of his heart condition from

coverage under the Wal-Mart Plan, Wal-Mart would have breached its

duty as plan administrator if it had paid Swi tzer's claim! That

truly would have been arbitrary and capricious.22 29 U.S.C. § 1132(a)(3)(A),(B).

2 3 I n re Sadkin

, 36 F.3d 473, 478 (5th Cir. 1994); I n re

Oxford Management, Inc.

, 4 F.3d 1329, 1334 (5th Cir. 1993); United

States v. Sutton , 786 F.2d 1305, 1308 (5th Cir. 1986).

19 D. Remedy

As we find that the factual underpinnings of the district

court's decision are clearly erroneous and conclude in our de novo

review that Wal-Mart was not arbitrar y and capricious in denying

Switzer's claim, we need not (and therefore do not) analyze in

depth the propriety of the "equitable" remedy that th e court

fashioned out of the whole cloth. We are nevertheless constrained

to observe SQ

admittedly in obiter dicta S Q that the district court's

reliance on equity in the absence of an available legal remedy may

well have constituted impermissible overreaching. For its license

to craft an equitable remedy, the court relied on ERISA sections

502(a)(3)(A) and (B). 2 2 Such reliance was almost certainly

misplaced. Traditional equitable remedies statutorily authorized

under ERISA are even more narrowly drawn than are those authorized

under the bankrup tcy statute, of which we have repeatedly noted

that "the statute does not

. . . constitute a roving commission to

do equity." 23 Although the court couched its equitable remedy in

terms of traditional injunctive or declaratory relief, in truth if

its innovative remedy were to be implemented it would surely create

substantive r ights that Switzer did not have under the Wal-Mart

Plan or under ERISA. Principal among the unauthorized rights that

would thus be created would be the right to have his long-dead

COBRA coverage resurrected, Lazarus-like, by court-ordered20

acceptance and retroactive application of the final COBRA premium

payment that Switzer had deliberately elected not to pay when it

was due. That he was laboring under a misconception regarding the

effect of his non-payment SQ a self-ind uced misconception, not one

caused by any fault of Wal-Mart SQ cannot change the result and grant

him a remedy where none may validly exist.

III

CONCLUSION

The district court clearly erred in finding that the plan

administrator's gratuitous notice to Switzer of October 4, 1991,

was not adequate to warn him that he risked a lapse in his COBRA

coverage if he did not pay the final premium by the extended grace

period date of October 16th, particularly when that notice was sent

a week after Switzer's COBRA coverage had already lapsed and should

have been cancele d automatically. In consequence of that clear

error, the district court erred as a matter o f law when it

determined that Wal-Mart as plan administrator was arbitr ary and

ca pricious in denying benefits to Switzer. We must, therefore,

reverse the rulings of the district court; vacate its orders that

Switzer tender the appropriate COBRA premium to Wal-Mart and that

Wal-Mart as plan administrator accept that premium and reconsider

its denial of Switzer's claims for payment of his medical bills;

and render a take-nothing judgment in Switzer's lawsuit against

Wal-Mart Stores, Inc.

REVERSED, VACATED and RENDERED.