Opinion ID: 779893
Heading Depth: 2
Heading Rank: 2

Heading: Bui's Claims

Text: 16 Bui alleges that SOS caused Duong's death by (1) negligently advising him to stay in Saudi Arabia; (2) failing to respond to his request for evacuation; and (3) failing to evacuate him. For the following reasons, we conclude that summary judgment on ERISA preemption grounds was inappropriate on all those claims. 21 17 The first claim amounts to an assertion of negligence in the provision of a benefit by a direct service provider. Bui alleges that Duong received the benefit promised by his ERISA plan, medical advice, but that the advice was negligent. This claim closely resembles the claim addressed in Roach. 22 In that case, the ERISA beneficiary had received an allegedly negligent recommendation from an advice nurse and did not go to a doctor until her broken ankle was permanently damaged. 23 Thus, the beneficiary in Roach received the benefit promised by her ERISA plan — advice from the advice nurse — but the benefit was negligently provided. Similarly, in this case, Duong received the benefit of medical advice that he was promised under his ERISA plan — SOS advised him to remain in Saudi Arabia for treatment. Bui simply alleges that SOS's advice was negligent. Thus, Bui's claim, like the claim of the plaintiff in Roach, is for the negligent provision of a benefit. 18 Because the benefit at issue in Roach was promised by an ERISA plan, some reference to the plan was necessary. However, we concluded that the claim alleged medical negligence at its root, and ERISA thus did not preempt it. 24 Similarly, in this case, Duong contacted SOS because it was the service provider designated by his ERISA benefits plan, and Bui's claim against SOS thus references — in a limited way — the plan. The claim otherwise does not involve the plan, however. At its root, the claim alleges negligence by SOS. Thus, just as the claim in Roach was not preempted, so, too, the claim in this case is not. Mere reference to an ERISA plan does not lead to preemption. 25 19 The second claim against SOS, that the company failed to respond to Duong's request for evacuation, involves a slightly more complicated analysis. ERISA preempts suits based on administrative delay, such as the delay that occurs when an administrator processes a request for coverage. 26 Thus, if the delay in responding to Duong was administrative, ERISA preempts the claim. SOS argues that it acted similarly to an ERISA administrator, that Bui's claim is thus based on administrative delay, and that ERISA preempts the claim. SOS points to nothing in the record to show that it acted as, or even like, an administrator, however, and we find no such evidence on our review of the record. Indeed, two pieces of evidence suggest that SOS was purely a service provider, not an ERISA administrator. 20 First, one of the physicians employed by SOS explained that SOS would have benefitted from evacuating Duong, because evacuation would have resulted in additional fees being paid to the company, but that SOS based its decision on the patient's needs. The first part of the physician's statement suggests that the interests of SOS were diametrically opposed to those of an ERISA administrator. An administrator bears a fiduciary responsibility to the plan as a whole to pay only covered costs and would not benefit from increased treatment costs. The second part of his statement suggests that SOS's duty was to determine what was in Duong's best interests as a patient — in other words, to make treatment recommendations, not coverage decisions. 21 Second, an agreement between SOS and AT & T/Lucent states that, if SOS could not contact plan administrators, SOS could evacuate a beneficiary without receiving prior approval from Lucent. Although this contractual provision might be read to offer a modicum of support for the argument that SOS could act in lieu of an administrator in these precise circumstances, its negative implication is that SOS did not act as an administrator in most circumstances. Moreover, there is no evidence that SOS had to act in lieu of an administrator in this case, because no one has suggested that SOS could not contact Lucent. 27 22 Thus, the evidence in the record, though limited, suggests that SOS acted purely as a service provider, not an administrator. Accordingly, its delay in responding to Duong appears not to have been administrative in nature. If that indeed is the case, and the delay was the result of simple negligence on the part of a direct service provider, ERISA does not preempt this claim. Because a genuine issue of material fact exists regarding whether SOS acted as a pure service provider, summary judgment on preemption grounds for Bui's second claim against SOS was inappropriate. ERISA does not preempt claims of negligence in the provision of services, including negligent delay. 23 The insufficient development of the record also precludes summary judgment on Bui's third claim against SOS, that it negligently failed to evacuate Duong. If the failure to evacuate resulted from an administrative decision, ERISA would preempt this claim. But again, we find no evidence in the record suggesting that the failure was in any way administrative. If SOS was a pure service provider and the failure to evacuate resulted from negligent delay or negligent medical evaluation, ERISA would not preempt this claim. Accordingly, summary judgment on preemption grounds is inappropriate.
24 Bui alleges only one claim against AT&T, for breach of contract. AT&T's role in the facts underlying this case ended when Lucent became Duong's employer and assumed the ERISA plan. 28 Duong's illness occurred after Lucent spun off from AT&T. Thus, AT&T's only role was establishing the plan and selecting SOS. Such activities are purely administrative, and ERISA preempts suits based upon them. 29 If such claims were not preempted, plan administrators would be held to a multiplicity of state standards when they decide how to structure ERISA plans and select service providers for those plans. 30 That is precisely the situation Congress sought to avoid when it passed ERISA and prescribed the broad preemption clause. 31 The district court correctly held that ERISA preempts the claim against AT&T.
25 Bui's claims against Lucent are more numerous. Bui alleges breach of contract for failure to provide adequate medical evaluation benefits and for failure to provide the evacuation benefit promised by the ERISA plan. In addition, Bui alleges that Lucent committed various negligent acts that led to Duong's wrongful death, including: Lucent's retention of SOS as a service provider; Lucent's failure to advise Duong that the return of his passport could be expedited in an emergency; Lucent's advice, through Dr. Waugh, that Duong should heed SOS's recommendation and stay in Saudi Arabia; and Lucent's delay in responding to Duong's request for further advice and for evacuation. 26 Summary judgment was properly granted as to the contract claims and as to the negligent retention claim. However, summary judgment was inappropriate on the three remaining claims: for negligence based on Lucent's failure to reveal the expedited passport procedure, for negligent provision of medical advice, and for negligent delay. We will address each claim in turn. 27 ERISA preempts Bui's contract claims. These claims do not merely reference the ERISA plan, 32 they require its construction because the contract allegedly breached is the ERISA plan itself. Accordingly, ERISA preempts the contract claims. 33 28 ERISA also preempts the claim for negligent retention of SOS as a service provider. Like the selection of providers, the retention of providers is a necessary part of the administration of an ERISA plan. Thus, for the same reasons ERISA precludes suit against AT&T for its initial decision to select SOS, ERISA shields Lucent's decision to retain SOS from the reach of state standards. 34 29 We cannot affirm the grant of summary judgment on preemption grounds as to Bui's last three claims against Lucent. The claim against Lucent for failing to inform Duong that his passport could be returned quickly in the event of an emergency appears to have nothing to do with ERISA. The emergency return of an employee's passport is not a benefit under an ERISA plan and nothing in the record links Lucent's failure to inform Duong that his passport could be returned to ERISA benefits. Thus, ERISA does not preempt this claim. 30 Genuine issues of material fact exist regarding Bui's last two claims against Lucent for negligent medical advice and for delay in responding to Duong. Although ERISA preempts suits based on negligent administrative decisions, including negligent delays in such decisions, 35 it is unclear from the current record whether Lucent was acting as a direct service provider or an administrator when it engaged in the behavior on which Bui bases her claims. Bui has pointed to evidence in the record that raises substantial factual questions regarding Duong's relationship with Waugh, who was unquestionably Lucent's agent and employee. Bui filed an affidavit stating that Waugh gave Duong medical advice regarding whether to stay in Saudi Arabia and that Duong asked Waugh for further advice and evaluation. If Waugh and Duong had a doctor-patient relationship, then Bui may sue Lucent for any medical malpractice its agent committed. 36 Bui's claims may include negligent medical advice and negligent delay in responding to Duong's medical questions, if that delay was made in the course of medically evaluating or treating Duong, rather than in the course of administering the ERISA plan. 31 Lucent has countered Bui's evidence that Waugh gave Duong medical advice with nothing save blanket statements that the evidence is unconvincing and that Lucent was an administrator. We may not, on summary judgment, weigh evidence. 37 The fact that Lucent may have acted as an administrator at other times is irrelevant. What matters is the hat it was wearing during the time it committed the acts of which Bui complains. 38 Bui has shown that a genuine issue of material fact exists regarding whether Lucent was wearing the hat of an administrator or the hat of a service provider when Waugh and Duong conferred and when Waugh did not respond to Duong's request for further medical advice and evaluation. Accordingly, summary judgment is inappropriate on Bui's claims against Lucent for negligent medical advice and for negligent delay.