Court Opinion

ID: 3188294
Source: CourtListenerOpinion
Date Created: 2016-03-23 20:04:09.381243+00
Date Added: 2024-06-11T14:36:02.144016
License: Public Domain

FILED
                           NOT FOR PUBLICATION                              MAR 23 2016

                                                                         MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                        U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

VANDANA UPADHYAY,                                No. 14-15420

              Plaintiff - Appellant,             D.C. No. 3:13-cv-01368-SI

 v.
                                                 MEMORANDUM*
AETNA LIFE INSURANCE COMPANY,
a Connecticut corporation, in its capacities
as a fiduciary and an administrator of the
Symmetricom, Inc. Long Term Disability
Benefits Plan, an ERISA-regulated
employee welfare benefit plan,

              Defendant - Appellee.

                   Appeal from the United States District Court
                      for the Northern District of California
                   Susan Illston, Senior District Judge, Presiding

                            Submitted March 15, 2016**
                             San Francisco, California

Before: McKEOWN, TALLMAN, and M. SMITH, Circuit Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
           The panel concludes this case is suitable for decision without oral
argument. See Fed. R. App. P. 34(a)(2).
      Vandana Upadhyay appeals the district court’s grant of Aetna Life Insurance

Co.’s (Aetna) motion for summary judgment in Upadhyay’s civil action under the

Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001 et

seq. Upadhyay also appeals the district court’s denial of her motion for

reconsideration. We have jurisdiction under 28 U.S.C. § 1291, and we affirm the

district court’s judgment.

      1. The district court properly granted Aetna summary judgment on the

ground that Upadhyay’s action was untimely under the Symmetricom, Inc. Long

Term Disability Benefits Plan’s (the Plan) provisions. The Plan provides: “No

legal action can be brought to recover under any benefit after 3 years from the

deadline for filing claims.” Under the Plan’s provisions, Upadhyay was required

to file a claim for benefits by July 1, 2007; and the three-year contractual

limitations period ended on July 1, 2010. Upadhyay, however, did not file her

claim for benefits until December 13, 2010, and she did not file the present lawsuit

until March 4, 2013. Therefore, Upadhyay’s ERISA action is untimely under the

provisions of the Plan.

      We further hold that Aetna did not waive its contractual limitations defense

despite failing to inform Upadhyay, in its denial letters, of the Plan’s contractual

limitations period for filing suit under ERISA. Under California law, an insurance

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company cannot waive a contractual limitations defense when the limitations

period has already run. See Gordon v. Deloitte & Touche, LLP Grp. Long Term

Disability Plan, 749 F.3d 746, 752 (9th Cir. 2014) (under California law, insurer

could not waive statute of limitations that had already run); see also id. (“[C]ourts

may turn to state common law for guidance and apply state law to the extent that it

is consistent with the policies expressed in ERISA.”); Scharff v. Raytheon Co.

Short Term Disability Plan, 581 F.3d 899, 901 (9th Cir. 2009) (declining to create

federal common law that would require insurers to “inform claimants expressly of

statutes of limitations that may bar their claims”).

      Therefore, Aetna cannot waive its contractual limitations defense because

the Plan’s contractual limitations period had already run at the time Aetna sent its

denial letters to Upadhyay. Even if Aetna could waive the contractual limitations

period, Upadhyay has not shown “an element of detrimental reliance or some

misconduct” on the part of Aetna. Gordon, 749 F.3d at 753.

      Nor does it change our analysis that the Plan’s contractual limitations period

ran before Upadhyay submitted her benefits application. The Supreme Court in

Heimeshoff v. Hartford Life & Accident Insurance Co., 134 S. Ct. 604, 611 (2013),

held that parties may “agree[] by contract to commence the limitations period at a

particular time,” which may start before an insurer has issued its final denial of

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benefits. Here, Upadhyay’s benefits application was submitted three-and-a-half

years late.

       Finally, Upadhyay argues that Aetna’s contractual limitations defense fails

because the defense is “an impermissible attempt to circumvent” California’s

notice-prejudice rule. See UNUM Life Ins. Co. of Am. v. Ward, 526 U.S. 358,

366–67 (1999) (notice-prejudice rule bars an insurer from avoiding liability based

on an untimely claim for benefits unless insurer can show actual prejudice from

delay). Upadhyay cites to no authority requiring a showing of prejudice in order to

prevail on a limitations defense challenging the timing of the ERISA action itself.

       2. Because Upadhyay’s ERISA claim is untimely under the Plan’s

contractual limitations period, we need not address whether Aetna waived its

Settlement Agreement defense.

       3. Not until her motion for reconsideration did Upadhyay argue that her suit

was timely under the Supreme Court’s decision in Heimeshoff and § 10350.7 of the

California Insurance Code. We hold that the district court did not abuse its

discretion by denying Upadhyay’s motion for reconsideration. Smith v. Pac.

Props. & Dev. Corp., 358 F.3d 1097, 1100 (9th Cir. 2004) (“We review the denial

of a motion for reconsideration for abuse of discretion.”).

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      “A motion for reconsideration ‘may not be used to raise arguments or

present evidence for the first time when they could reasonably have been raised

earlier in the litigation.’” Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH &

Co., 571 F.3d 873, 880 (9th Cir. 2009) (quoting Kona Enters., Inc. v. Estate of

Bishop, 229 F.3d 877, 890 (9th Cir. 2000)). The district court correctly noted that

“there was no reference or citation to the California Insurance Code at all in

[Upadhyay’s] opposition brief.”

      In addition, the legal principle annunciated in Heimeshoff—that a controlling

statute could supplant a plan’s contractual limitations period—was already law in

the Ninth Circuit at the time Upadhyay filed her opposition brief. See, e.g., Wetzel

v. Lou Ehlers Cadillac Grp. Long Term Disability Ins. Program, 222 F.3d 643,

650–51 (9th Cir. 2000) (en banc) (remanding action to district court to determine

whether the plaintiff’s action was contractually barred by the plan’s limitations

provisions in light of California law, particularly Cal. Ins. Code § 10350.7);

Stephan v. Unum Life Ins. Co. of Am., 697 F.3d 917, 927 (9th Cir. 2012)

(explaining that California statutory law is read into insurance policies and

becomes part of the contract).

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       The district court acted well within its discretion by declining to reconsider

its prior order based on an argument that should have been raised earlier in the

litigation.

       AFFIRMED.

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