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Surviving a Motion to Dismiss after Amending the Complaint: S.D. Fla.

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  • Surviving a Motion to Dismiss after Amending the Complaint: S.D. Fla.

    In a recent case from southern Florida, the Plaintiff originally brought an ERISA case in state court. The Defendant properly removed it to the federal level, then moved to dismiss based on ERISA preemption. The court granted the motion but gave the Plaintiff an opportunity to amend the complaint, which he did. Now before the court is the same issue, and the Defendant again moves to dismiss the case on several grounds; one of which was the Plaintiff's failure to exhaust the administrative remedies.

    Defendant relies upon Variety Children’s Hosp.1, Byrd2, and Sanctuary Surgical Centre, Inc.3 in support of its argument. In Variety Children’s Hosp., a district court found that the hospital failed to properly plead the exhaustion requirement of ERISA where plaintiff alleged that “[a]t all times material hereto, the [p]laintiff performed all obligations imposed on her by the contract of insurance in effect or, in the alternative, such conditions have been waived or excused,” 942 F. Supp. at 568, but failed to allege any facts whatsoever relating to administrative remedies. In Byrd, the Eleventh Circuit upheld the district court’s determination that the plaintiff failed to properly plead exhaustion because the plaintiff “did not allege anything about whether she pursued any available relief under the claims procedures terms of [the] employee benefits plan.” 961 F.2d at 160-61. And in Sanctuary Surgical Centre, Inc., the Court held that this provider did not properly plead the exhaustion requirement of ERISA even though it alleged that they had “filed internal appeals” where they also failed to allege that the appeals process was followed to its conclusion.
    The court, however, is not persuaded, and finds that the allegations in the case at bar are readily distinguishable from the above mentioned cases. The court notes that the deficiencies the Defendant alleges are twofold: a failure to address any claims procedures at all related to administrative remedies, and a failure to allege that the Plaintiff followed the appeals process to its conclusion or was prevented from doing so.

    This Amended Complaint is not plagued by either deficiency. See [D.E. 16, ¶ 17] (“Plaintiff has exhausted all administrative remedies and any further administrative review would be futile.”). By alleging that Plaintiff “has exhausted all administrative remedies,” id., the Amended Complaint clearly addresses that Plaintiff pursued and exhausted claims procedures. Id. Additionally, in support of the alternative allegation of futility, Plaintiff alleges that Defendant failed to respond to Plaintiff’s timely submitted claim for over ninety (90) days; that despite intervention of a claims consultant, Defendant again failed to meaningfully respond or make payment; and that Defendant almost entirely ignored or otherwise declined Plaintiff’s claims. Id., ¶¶ 14-16; see Sanctuary Surgical Centre, 2011 WL 2134534, at *9 (“To properly plead futility, plaintiffs must allege why exhausting their administrative remedies would be futile and provide sufficient detail to make their claim of futility plausible.”).
    Ultimately, the court recommended that the motion be denied. The entire Report and Recommendation is attached below.
    Attached Files
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