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Statute of Limitations for Contract Actions Applied to an ERISA Appeal of a Denial of Benefits.
Posted by: Melville Johnson, P.C.
June 13, 2008
Topic: Erisa Retirement Benefits
The Attorneys with Melville Johnson, P.C. can provide representation in cases alleging violations under the Employment Retirement Income Security Act (ERISA)
As the result of a January, 2000 motor vehicle accident, Ms. Sonya Pettaway began receiving long-term disability insurance payments from an employment-related policy. When her benefits were terminated in August, 2004 by the plan administrator, she filed an internal appeal. The internal appeal was denied in September, 2005, and two years later she filed a lawsuit, in the United States District Court for the District of Columbia, alleging unlawful termination of her disability benefits under the Employee Retirement Income Security Act (ERISA).
Ms. Pettaway named the following as Defendants in the complaint: the National Academy of Sciences Group Total Disability Insurance Plan; Teachers Insurance and Annuity Association of America (TIAA), the underwriter of the plan; and The Standard Benefit Administrators (SBA), the administrator of the plan. The Defendants eventually moved to dismiss the complaint based upon the applicable District of Columbia three-year statute of limitations for contract actions (ERISA having no limitation in its provisions). The District Court held that this was a rare case in which it was necessary to apply the doctrine of equitable tolling to avoid an unjust result. The District Court concluded that the reason for Ms. Pettaway's delay was that she was pursuing the internal appeal, and it was not her fault that the process was lengthy.
Thus, the District Court held that while Pettaway's claims accrued upon denial in August 2004, the limitations period was tolled until September, 2005 when the internal appeal process was concluded. Thus, the lawsuit was timely filed and the motion to dismiss was denied.
The information in this summary was primarily derived from the Judicial View.
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