District Courts in 11th and 4th Circuits Re-affirm Varity Rule in Face of Amara-like Claims
After Varity Corp. v. Howe, 516 U.S. 489, 116 S. Ct. 1065 (1996), a well-established rule developed throughout the Circuits: When a claimant has an adequate available claim for employee benefits under ERISA § 502(a)(1)(B), a claim for equitable relief under ERISA § 502(a)(3) is duplicative and therefore not appropriate. See e.g., Korotynska v. Metropolitan Life Ins. Co., 474 F. 3d 101 (4th Cir. 2006). In 2011, along came Cigna v.Amara, 131 S. Ct. 1866 (2011), in which the Court provided fresh suggestions of equitable remedies (such as surcharge) that a claimant might bring under ERISA § 502(a)(3). This ignited a resurgence by claimants bringing employee benefit lawsuits to tag on an equitable relief claim for good measure.
Last month, District Courts in the 11th and 4th Circuit joined courts in other Circuits (see e.g.,Biglands v. Raytheon, 801 F. Supp. 2d 781 (N.D. Ind. 2011)), in finding nothing in Amara that alters the Varity rule. In Spivey v. Cigna, 2013 U.S. Dist. LEXIS 130219 (M.D. Ala. Sept. 12, 2013), the District Court heftily rejected the argument by the plaintiff seeking disability benefits that Amarachanged the Varity rule. Likewise, in Harp v. Liberty Mutual, 2013 U.S. Dist. LEXIS 140083 (M.D. N.C. Sept. 30, 2013), also involving a disability benefit claim, the magistrate judge rejected the plaintiff’s citation to Amara, re-affirmed the Varity rule, and recommended dismissal of the plaintiff’s causes of action brought under ERISA § 502(a)(3). (As of date of reporting, the plaintiff has not filed an objection to the Recommendation.)