UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

SANDRA MCCANDLESS,

Plaintiff,

v.

COUNTRYWIDE HOME LOANS, INC., and

STANDARD INSURANCE COMPANY, a

subsidiary of STANCORP FINANCIAL

GROUP, INC., jointly and severally,

Defendants.

_____________________________________/

Case No. 08-14195

HON. MARIANNE O. BATTANI

OPINION AND ORDER

I. INTRODUCTION

Before the Court is Countrywide Home Loans, Inc. and Standard Insurance

Company’s (hereinafter collectively “Defendants”) Partial Motion to Dismiss Counts III

and IV of Plaintiff Sandra McCandless’s First Amended Complaint (Doc. #18). Plaintiff

has since filed a Second Amended Complaint. During the hearing on the motion,

Plaintiff and Defendants agreed that this motion applies to the Second Amended

Complaint because Counts III and IV were not changed. 

In Counts I and II of the Second Amended Complaint, Plaintiff seeks to recover

monthly disability benefits and to enjoin Defendants from terminating or reducing

benefits in the future pursuant to § 502(a)(1)(B) of the Employment Retirement Income

Security Act of 1974 (“ERISA”). Under Counts III and IV of the Second Amended

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Complaint, Plaintiff seeks the same relief as under Counts I and II, but pursuant to §

502(a)(3) of ERISA. Defendants assert that Counts III and IV of the Second Amended

Complaint should be dismissed under Federal Rule of Civil Procedure 12(b)(6) for

failure to state an ERISA § 502(a)(3) claim. (Doc. #18). 

For the reasons stated below, the Court GRANTS Defendants’ motion. 

II. STATEMENT OF FACTS

Because this is a Rule 12(b)(6) Motion to Dismiss, the Court will accept Plaintiff’s

factual allegations as true. Allard v. Weitzman, 991 F.2d 1236, 1240 (6th Cir. 1993).

On or about February 2, 2005, Plaintiff was disabled because she suffered from

mental illness and ankylosing spondylitis (hereinafter “AK”), an inflammatory disease of

the spine. Because of this, she was entitled to disability benefits through her employer,

Countrywide Home Loans, Inc. (“Countrywide”). Standard Insurance Company

(“Standard”) is Countrywide’s long-term disability claims administrator.

According to Standard’s long-term disability policy, if disability is due to a 

mental disorder, benefits may be paid for a maximum of 24 months. If, however,

disability is not due to a mental disorder, benefits may be paid up to the age of 65.

Standard paid Plaintiff long-term disability benefits under the classification of

mental disorder for a period of 24 months. When the 24-month benefit period for mental

illness expired, Plaintiff continued to be disabled due to her AK. Standard informed her,

however, that it considered her disabled solely due to mental illness and terminated her

benefits. 

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III. STANDARD OF REVIEW

Federal Rule of Civil Procedure 12(b)(6) allows a district court to dismiss a

complaint that fails “to state a claim upon which relief may be granted.” “This rule

allows a defendant to test whether, as a matter of law, the plaintiff is entitled to legal

relief even if every allegation in the complaint is true.” Tidik v. Ritsema, 938 F.Supp.

416, 421 (E.D. Mich. 1996). Thus, when faced with a Rule 12(b)(6) motion to dismiss, a

district court “must construe the complaint in the light most favorable to the plaintiff,

[and] accept all factual allegations as true.” Allard v. Weitzman, 991 F.2d 1236, 1240

(6th Cir. 1993). However, the court does not give the presumption of truthfulness to any

legal conclusions, opinions, or deductions, even if they are couched as factual

allegations. Sexton v. Barry, 233 F.2d 220, 223 (6th Cir. 1956); Tidik, 938 F.Supp. at

421. 

IV. ANALYSIS

As an initial matter, Plaintiff acknowledged during the hearing on this motion that

Counts II and IV against her employer, Countrywide, should be dismissed. Accordingly,

the Court will dismiss those counts. 

Plaintiff seeks payment of benefits pursuant to § 502(a)(1)(B) under a wrongful

denial of benefits theory (Count I). Plaintiff also seeks payment of benefits pursuant to

§ 502(a)(3) under a breach of fiduciary duty theory (Count III), alleging that the terms of

the disability plan were misrepresented by Standard. Defendants argue that Count III is

a repackaged denial of benefits claim, barred by Wilkins.

In Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609, 615 (6th Cir.1998),

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the Sixth Circuit held that relief under § 502(a)(3) was only available to beneficiaries

who could not avail themselves of § 502's other remedies. The plaintiff alleged that the

defendant violated § 502(a)(3) by breaching its fiduciary duty to act solely in the

plaintiff's interest for the purpose of providing benefits. Id. The Sixth Circuit found the §

502(a)(3) claim barred “[b]ecause § [502(a)(1)(B)] provides a remedy for Wilkins's

alleged injury that allows him to bring a lawsuit to challenge the Plan Administrator's

denial of benefits to which he believes he is entitled, he does not have a right to a cause

of action for breach of fiduciary duty pursuant to § [502(a)(3)].” Id.

In Count I, Plaintiff seeks to recover benefits under a wrongful denial of benefits

theory pursuant to § 502(a)(1)(B). (Doc. #33 at 3-4). She alleges that Standard directly

violated the disability benefits policy and the terms of the Plan when it denied her

disability benefit payments. (Id.). Specifically, Plaintiff seeks the following relief under

Count I: an order compelling Standard to pay past disability amounts plus interest; an

accounting of amounts owed to Plaintiff; disgorgement of any profits or gain Standard

has gained by denying Plaintiff the disability benefits; judgment declaring that Plaintiff is

entitled to continuation of the disability benefits; and reasonable attorney fees and

costs. 

In Count III of her Complaint, Plaintiff alleges that Standard, “as fiduciary with

respect to the Plan, has and had a duty to discharge its duties with respect to the Plan

solely in the interest of the Plan participants and their beneficiaries.” (Doc. #33 at 5). 

She alleges that Standard breached its fiduciary duties by denying Plaintiff disability

benefit payments and by not providing an accurate accounting of her benefits. In Count

III, Plaintiff seeks the same relief as she seeks in Count I, but under a breach of

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fiduciary duty theory pursuant to § 502(a)(3). 

Count III could have been characterized as a denial of benefits claim and brought

under § 502(a)(1)(B). In fact, Plaintiff has done so in Count I. The claim for benefits

under Count I pursuant to § 502(a)(1)(B) alleges that Standard improperly denied

benefits, and the claim for benefits under Count III pursuant to § 502(a)(3) alleges

Standard breached its fiduciary duty to Plaintiff when it improperly denied benefits. This

alleged breach of duty is analogous to the breach alleged in Wilkins, namely that the

defendant did not act solely in the plaintiff’s interest in assessing the benefits claim. 

Therefore, because the alleged injury can be characterized as a benefits claim, it is only

allowed under § 502(a)(1)(B). See Wilkins, 150 F.3d at 615.

In further support of why the claim must be brought under § 502(a)(1)(B), the

Supreme Court in Varity Corp. v. Howe, 516 U.S. 489, 512 (1996), held that § 502(a)(3)

is a catchall provision offering appropriate equitable relief only when there is no other

adequate remedy available under § 502. When a plaintiff can assert a claim for relief

under § 502(a)(1)(B), then that plaintiff is barred from seeking essentially the same relief

under § 502(a)(3). Id. In this case, Plaintiff is able to, and does, seek relief under §

502(a)(1)(B) – the same relief she seeks under § 502(a)(3). Because Plaintiff seeks the

same relief in Count I as she seeks in Count III of her Complaint, § 502(a)(1)(B)

provides adequate relief and further equitable relief under § 502(a)(3) is inappropriate.

See id.

In Gore v. El Paso Energy Corp. Long Term Disability Plan, 477 F.3d 833, 841

(6th Cir. 2007), the only case Plaintiff cites in her response, the Sixth Circuit Court of

Appeals found that the plaintiff was able to bring a claim under both § 502(a)(1)(B) and

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§ 502(a)(3) because the alleged injuries were “separate and distinct.” In this case,

Plaintiff’s injuries in her § 502(a)(3) claim are not separate and distinct from her injuries

in her § 502(a)(1)(B) claim. Accordingly, Plaintiff’s “§ 502(a)(3) claim of breach of

fiduciary duty is merely a repackaged § 502(a)(1)(B) claim.” Id. at 842. As such,

Plaintiff’s § 502(a)(3) claim is barred.

V. CONCLUSION

Plaintiff has acknowledged that Counts II and IV should be dismissed. 

Furthermore, the Court dismisses Count III because Plaintiff has an adequate remedy

available under § 502(a)(1)(B). Therefore, the Court GRANTS Defendants’ Partial

Motion to Dismiss Counts III and IV. Counts II, III, and IV are DISMISSED. 

IT IS SO ORDERED.

s/Marianne O. Battani 

MARIANNE O. BATTANI

UNITED STATES DISTRICT JUDGE

DATED: June 2, 2009

CERTIFICATE OF SERVICE

Copies of this Order were served upon counsel of record on this date by ordinary

mail and/or electronic filing.

 s/Bernadette M. Thebolt

 DEPUTY CLERK

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