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Son Sues Life Insurance Company After Father’s Death

Jason Minchella was insured under a group life insurance policy issued by Defendant Sun Life Assurance that he received as a benefit for his employment with La Brea Bakery (the “Policy”). The Policy provided both a general life and insurance benefit and a basic accidental death benefit. Jason Minchella dies on June 13, 2011. Following his death, his son, Anthony Minchella, is the administrator of his father Jason Minchella’s estate. Anthony filed a claim with Sun Life for benefits under the Policy. On June 4, 2013, Anthony filed a complaint against Sun Life, asserting numerous state-law causes of action arising from Sun Life’s alleged delay and denial of payment of the benefits requested in the First Claim.

Anthony Minchella seeks declaratory judgment and other relief under the Employee Retirement Income Security Act (“ERISA”)1, alleging that Defendant Sun Life Assurance has failed to make a decision on Anthony’s claim for basic accidental death benefits, pursuant to a policy issued to the decedent, Jason Minchella, despite Plaintiff’s repeated requests that Defendant do so. Defendant has moved to dismiss the claim on the grounds that Plaintiff’s claim is precluded under the doctrine of res judicata and that Plaintiff has failed to exhaust his administrative remedies as required under ERISA. Sun Life filed a motion to dismiss, arguing that the state law claims must be dismissed as pre-empted by ERISA.

On August 12, 2013, while Sun Life’s motion to dismiss was still pending before the Court, Minchella and the life insurance company entered into a release and settlement agreement, under which Sun Life paid Minchella $48,000 in return for the discharge and release of all claims for general life insurance benefits. Though it is unclear, it appears that before entering into the release and settlement agreement, the Plaintiff had filed an additional claim with the Defendant, specifically requesting accidental death benefits. The release and settlement agreement carved out the pending Second Claim from the settlement as follows:

“This release shall not include, however, the current claim for accidental death and dismemberment (AD&D) benefits that the Estate has pending with Sun Life.”

The Court ruled that Anthony’s state-law claims were preempted by ERISA, and dismissed the complaint without prejudice to Anthony’s right to file an amended complaint stating an appropriate federal cause of action within 30 days. Nine months later, Minchella returned, filing a new complaint. The 2014 Complaint raised numerous state-law causes of action arising from Defendant’s alleged refusal to communicate with Plaintiff and recognize his entitlement to accidental death benefits. The Defendant removed the case to this Court, again arguing that Plaintiff’s state-law claims were preempted by ERISA, and the 2014 Complaint became the basis of this action. Defendant then moved to dismiss the 2014 Complaint as preempted by ERISA and precluded by the doctrine of res judicata.

The doctrine of res judicata bars a party from instituting a subsequent suit against the same party based on the same cause of action asserted in the initial suit. The express reservation of the Second Claim in the release and settlement agreement appears to evince Plaintiff’s intent to exhaust administrative remedies, and the allegation that Defendant repeatedly ignored Plaintiff’s request to reach a final claim decision raises a potential issue as to whether any further attempt to exhaust administrative remedies would have been futile. The current state of the record therefore does not permit any determination as to the affirmative defense of exhaustion of administrative remedies, but Defendant may, if appropriate, raise the issue again in any motions for summary judgment. The Defendant’s motion to dismiss will be denied.



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