Court Opinion

ID: 3187518
Source: CourtListenerOpinion
Date Created: 2016-03-22 15:02:30.415992+00
Date Added: 2024-06-11T07:39:03.213497
License: Public Domain

15-2876-cv
     Varela v. Barnum Fin. Grp.

                         UNITED STATES COURT OF APPEALS
                             FOR THE SECOND CIRCUIT

                                  SUMMARY ORDER
     RULINGS  BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
     FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
     APPELLATE PROCEDURE 32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY
     ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX
     OR AN ELECTRONIC DATABASE (WITH THE NOTATION ASUMMARY ORDER@). A PARTY CITING A SUMMARY
     ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

 1        At a stated term of the United States Court of Appeals for
 2   the Second Circuit, held at the Thurgood Marshall United States
 3   Courthouse, 40 Foley Square, in the City of New York, on the
 4   22nd day of March, two thousand sixteen.
 5
 6   PRESENT: DENNIS JACOBS,
 7            PETER W. HALL,
 8                          Circuit Judges
 9            JANE A. RESTANI,1
10                          CIT Judge.
11
12   - - - - - - - - - - - - - - - - - - - -X
13   MARTA BARBEOSCH VARELA, individually
14   and as executor of the Estate of WILLIAM
15   P. BARBEOSCH,
16             Plaintiff-Appellant,
17
18                -v.-                                           15-2876-cv
19
20   BARNUM FINANCIAL GROUP, PETER GRECO,
21            Defendants-Appellees.
22   - - - - - - - - - - - - - - - - - - - -X
23

     1
          Jane A Restani, Judge for the United States Court of International
     Trade, sitting by designation.

                                                1
 1   FOR APPELLANT:               Thomas More Marrone, Greenblatt,
 2                                Pierce, Engle, Funt & Flores, LLC,
 3                                Philadelphia, PA.
 4
 5   FOR BARNUM APPELLEE:         Michael H. Bernstein (Matthew P.
 6                                Mazzola, on the brief), Sedgwick
 7                                LLP, New York, NY.
 8
 9   FOR GRECO APPELLEE:          Christopher M. Pisacane,
10                                Sichenzia Ross Friedman Ference
11                                LLP, New York, NY.
12
13        Appeal from a judgment of the United States District Court
14   for the Southern District of New York (Carter, J.).
15
16        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED AND
17   DECREED that the judgment of the district court be AFFIRMED.
18
19        Marta Barbeosch Varela (“Varela”), in her individual
20   capacity and as executor of the estate of her deceased husband,
21   William Barbeosch (“Barbeosch”), appeals from the judgment of
22   the United States District Court for the Southern District of
23   New York (Carter, J.) dismissing her common law claims for
24   damages against Barnum Financial Group (“Barnum”) and Peter
25   Greco (“Greco”), on the ground of ERISA preemption. We assume
26   the parties’ familiarity with the underlying facts, the
27   procedural history, and the issues presented for review.

28        Until April 1, 2011, Barbeosch was the Chief Fiduciary
29   Officer of a wholly-owned subsidiary of SunTrust Banks, Inc.
30   (“SunTrust”). SunTrust offered an ERISA-governed employee
31   welfare benefit plan (the “Plan”) to its employees. Under the
32   Plan, SunTrust was the Plan Administrator, while Metropolitan
33   Life Insurance Company (“MetLife”) underwrote the coverage and
34   was the claims administrator. As a full-time employee at an
35   annual salary of $300,000, Barbeosch was entitled to a group
36   life insurance policy that would pay his beneficiary, Varela,
37   $450,000 upon his death. On April 1, 2011, Barbeosch became
38   a part-time employee and as a result was entitled to no more
39   than a basic life insurance plan that carried $10,000 of
40   coverage. He nevertheless had an option to convert the excess
41   of his $10,000 policy into a private individual policy. He was

                                   2
 1   interested in doing so, in part because he had cancer at the
 2   time.

 3        Varela alleges the following sequence of events. On April
 4   8, 2011, Barbeosch received an email from SunTrust human
 5   resources stating that he had 31 days to convert his life
 6   insurance policy; on April 18, 2011, Barbeosch consulted with
 7   Greco, a financial services representative with Barnum, who
 8   informed Barbeosch that he had 31 days from April 18 to convert
 9   his policy; on April 27, 2011, Barbeosch and Greco further
10   discussed converting Barbeosch’s policy; Barbeosch died on May
11   13, 2011 without having converted his life insurance policy.

12        The Plan undisputedly required Barbeosch to convert his
13   policy within 31 days of his change in employment status, i.e.,
14   by May 2, 2011. Varela brings claims for negligence, negligent
15   misrepresentation, and breach of fiduciary duty against Greco
16   and Barnum.

17        The district court dismissed Varela’s claims as preempted
18   by ERISA. Barnum is not an independent legal entity, but is
19   an office and trade name of MetLife, so in reality Varela brought
20   suit against MetLife d/b/a Barnum. Because Varela sued MetLife
21   d/b/a Barnum and a Barnum employee (Greco) for advice they
22   allegedly gave Barbeosch about the Plan’s conversion
23   requirement, the district court concluded that Varela’s claims
24   arose out of the defendants’ operation and management of a
25   benefit plan covered by ERISA, and were therefore preempted.
26   Varela appeals and argues that her claims are not preempted
27   because they are for damages, under state law, and are lodged
28   against what are effectively strangers to the Plan.

29        1. We review de novo a district court’s decision to
30   dismiss a claim as preempted by ERISA. Arditi v. Lighthouse
31   Int’l, 676 F.3d 294, 298 (2d Cir. 2012).

32        Congress enacted ERISA to establish a “uniform regulatory
33   regime over employee benefit plans” and “to ensure that employee
34   benefit plan regulation is exclusively a federal concern.” Id.
35   at 299 (quoting Aetna Health Inc. v. Davila, 542 U.S. 200, 208
36   (2004)). To further these ends, ERISA preempts a cause of
37   action where (i) “an individual, at some point in time, could
38   have brought his or her claim under ERISA § 502(a)(1)(B)” and

                                    3
 1   (ii) “no other independent legal duty . . . is implicated by
 2   a defendant’s actions.” Id. (quoting Davila, 542 U.S. at 210);
 3   see also Montefiore Med. Ctr. v. Teamsters Local 272, 642 F.3d
 4   321, 328 (2d Cir. 2011).

 5        Although such preemption is broad, courts are reluctant to
 6   find state laws preempted unless they implicate the
 7   relationships among “the core ERISA entities: beneficiaries,
 8   participants, administrators, employers, trustees and other
 9   fiduciaries.” Gerosa v. Savasta & Co., 329 F.3d 317, 324 (2d
10   Cir. 2003). For example, “courts routinely find that
11   garden-variety state-law malpractice or negligence claims
12   against non-fiduciary plan advisors, such as accountants,
13   attorneys, and consultants, are not preempted.” Id. But
14   “state laws that would tend to control or supersede central
15   ERISA functions – such as state laws affecting the determination
16   of eligibility for benefits, amounts of benefits, or means of
17   securing unpaid benefits – have typically been found to be
18   preempted.” Id.

19        ERISA preempts Varela’s claims. Varela is a beneficiary
20   of the Plan. Her claims arise out of purported oral
21   misrepresentations by MetLife d/b/a Barnum and a Barnum
22   employee about the process for converting a group life insurance
23   policy under the Plan. Greco is an employee of Barnum and
24   Barnum is an office of MetLife. As the insurer and claims
25   administrator of the Plan, MetLife was a fiduciary and a “core
26   ERISA entit[y].” Varela’s claims concern Barbeosch’s right
27   under the Plan to convert his policy and the process for doing
28   so – “central ERISA functions.” Finally, the alleged breach
29   here concerned the Plan itself, not, as in Stevenson v. Bank
30   of New York Co., Inc., 609 F.3d 56, 60-61 (2d Cir. 2010), an
31   agreement separate and independent from the Plan. See Arditi,
32   676 F.3d at 300.

33        Accordingly, and finding no merit in Varela’s other
34   arguments, we hereby AFFIRM the judgment of the district court.

35                                FOR THE COURT:
36                                CATHERINE O’HAGAN WOLFE, CLERK
37

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