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Old 07-05-2008
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SCOTUS Denies Widow

This is disgraceful. This and the giving Corps your land decision. See what happens when you elect conservatives who pack the court with corporate toadies?

Quote:
Employers use federal law to deny benefits By MARK SHERMAN, Associated Press Writer
Sat Jul 5, 11:04 AM ET



WASHINGTON - Dying of cancer, Thomas Amschwand did everything he was told to make sure his wife would collect on the life insurance policy he had through his employer.

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"He was obsessed with dotting every `i' and crossing every `t'," Melissa Amschwand-Bellinger recalled about her husband, who died in 2001 at age 30.

But Spherion Corp., the temporary staffing company where Amschwand worked, told Amschwand-Bellinger she would not receive any of the $426,000 in benefits she believed she was due. When she went to court, Spherion succeeded in getting her lawsuit thrown out. The Supreme Court on June 27 refused to review the case.

Amschwand-Bellinger received a refund of the few thousand dollars in insurance premiums she and her husband dutifully had paid. The total, she said, would not cover the costs of his funeral.

The story has played out often under the federal Employee Retirement Income Security Act. Designed to protect employee benefits, the law has been used by employers as a shield against suits.

Federal appeals courts, interpreting Supreme Court decisions dating to 1993, consistently have said companies that offer health, life and retirement benefits under ERISA cannot be sued for large amounts of money, or damages. Instead, they can be sued only for typically smaller sums such as Amschwand's insurance premiums.

Several federal judges have bemoaned the unfairness even as they have felt constrained to rule in favor of employers.

"The facts ... scream out for a remedy beyond the simple return of premiums," Judge Fortunato Benavides of the New Orleans-based 5th U.S. Circuit Court of Appeals said in the Amschwand case. "Regrettably, under existing law it is not available."

The Bush administration has argued that the appeals courts are misreading the precedents and has asked the high court at least twice to clarify the earlier rulings. So far it has refused.

Congress, which could amend ERISA to make clear such suits are allowed, also has taken no action.

The result, in the view of ERISA experts, the administration and some lawmakers, is perverse.

"The beneficiary under the policy didn't get the promised benefit," said Colleen Medill, an expert on ERISA at the University of Nebraska-Lincoln. "To say we're just going to return your premiums, that's a total farce. That's not what they paid the premiums for. They paid them for the benefits."

Sen. Patrick Leahy, chairman of the Senate Judiciary Committee, said at a recent hearing that before ERISA became law, employees clearly could sue for benefits in state courts.

The court rulings, said Leahy, D-Vt., have left people "more vulnerable than they were before the law was passed."

Spherion's decision to deny benefits to Amschwand-Bellinger turned on an odd set of facts. Spherion, which employs about 300,000 people, switched insurers after Thomas Amschwand was diagnosed with a rare form of heart cancer. The new policy did not take effect until an employee worked one full day. Spherion never informed Amschwand of the requirement.

Amschwand asked repeatedly whether there was anything else he needed to do and was told no. He asked that the new policy be sent to him. Spherion never did so.

He died without returning to work. His widow said he easily could have worked a day if that was what it took to activate the new policy. Spherion could have waived the one-day-of-work provision, as it did for other employees but not for Amschwand.

Spherion spokesman Kip Havel issued a brief statement when contacted by The Associated Press after the high court declined to review the case. "We are pleased the court has made its decision and the matter has finally been resolved," Havel said.

The court also recently turned down an appeal from Louis Gerard "Gerry" Goeres, who sued Charles M. Schwab & Co. over hundreds of thousands of dollars in retirement plan benefits.

For 16 months, Schwab mistakenly refused to acknowledge Goeres as the beneficiary in the retirement plan of his domestic partner, Stephen Ward, a Schwab employee who died in 1999. By the time Schwab acknowledged its error, the value of the account had declined by more than $500,000. Goeres sued for the rest. Federal courts dismissed the suit. "Unfortunately, legal relief is not available," U.S. District Judge Charles Breyer said in ruling against Goeres.

"You know the Schwab commercial, `Talk to Chuck?'" Goeres said. "I thought if Chuck knew this, he'd say, 'Oh my God, this is so wrong.' I live on naive dreams."

Schwab said in court papers that Goeres could have taken legal action soon after Ward's death, when he first was told he was not the beneficiary.

Amschwand-Bellinger said the cases show the need for either the court or Congress to provide "some sort of meaningful remedy for employees when employers have a breach of fiduciary duty."

A Texas native who lives in an unincorporated Houston suburb, she has since remarried and has an 18-month-old daughter. She is president and executive director of the Amschwand Sarcoma Cancer Foundation, which she founded with her first husband.

She recognizes that she is more fortunate than many others who have fought similarly futile battles for benefits under ERISA. "What if we had had children and I was a stay at home mom?" said Amschwand-Bellinger, who previously worked for a public hospital system. "What if I was 60 years old, with no skill sets, and I had to go back to work?"
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Old 07-09-2008
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Jason Marcel Jason Marcel is offline
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Re: SCOTUS Denies Widow

I don't get how ERISA works. And I don't understand why the SCOTUS can't make a company pay the benefits after reviewing the signed documents. I just don't get it. I'm not saying some corporations are greedy, I get that, but how can a judge basically throw it out?
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Old 07-09-2008
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Re: SCOTUS Denies Widow

This means that a company can deny an employee (or former employee) the benefits for which he paid, and only have to pay back the premiums paid by that employee. What a scam.
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Old 07-09-2008
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drgoodtrips drgoodtrips is online now
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Re: SCOTUS Denies Widow

It sounds to me like a bureaucratic oversight as opposed to any malfeasance. The guy didn't meet the criteria for the policy and so was denied. It sucks, to be sure, but lots of shitty things happen to lots of decent people, and the SCOTUS doesn't take the time to address each one of them, even legitimate ones, which this appears not to be.

There are an awful lot of sob stories out there.

Out of curiosity, those who think that the wife should be able to sue the insurers for exorbitant amounts of money... why do you think that?
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by drgoodtrips View Post
It sounds to me like a bureaucratic oversight as opposed to any malfeasance. The guy didn't meet the criteria for the policy and so was denied. It sucks, to be sure, but lots of shitty things happen to lots of decent people, and the SCOTUS doesn't take the time to address each one of them, even legitimate ones, which this appears not to be.

There are an awful lot of sob stories out there.

Out of curiosity, those who think that the wife should be able to sue the insurers for exorbitant amounts of money... why do you think that?
Yeh, crying liberal cow, she only paid the money all these years in pure good faith like the company told her to, what's the whiny bitch want, justice?

She either been a victim of negligence (a 'bureaucratic oversight' is a mistake, and a mistake qualifies as negligence) or, if the company never intended to pay and so deliberately didn't tell her, she's the victim of fraud. In either case she used to be able to sue for at least what she paid for but apparently, the SCOTUS now takes your view that corporations can do no wrong, so we little people are just SOL if they decide to fuck us.

Compassionate conservatism at its best. We can't rely upon our insurance but rich people can still buy guns to protect themselves from all those they've swindled out of their life savings.
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Trying to call this a conservative or liberal issue shows ignorance of when ERISA was written and adopted and amended, and also of the fact pattern quoted in the article in post 1.

Plainly, ERISA is a poor law as written. The SCOTUS can only interpret the law that is on the books.

The Congress can change the law, but hasn't even though they know about the flaws.

The Executive has asked the courts to clarify the law, but the Executive cannot change the law.

Matt
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by MattLarson View Post
Trying to call this a conservative or liberal issue shows ignorance of when ERISA was written and adopted and amended, and also of the fact pattern quoted in the article in post 1.

Plainly, ERISA is a poor law as written. The SCOTUS can only interpret the law that is on the books.

The Congress can change the law, but hasn't even though they know about the flaws.

The Executive has asked the courts to clarify the law, but the Executive cannot change the law.

Matt
The SCOTUS, like any court, can overturn laws which are against the public interest because they work at cross purposes to other laws, are manifestly unjust, "toothless" etc. Besides, didn't they just refuse to even hear the case?

The Bush appointees are telling the corps loud and clear, we, the people, can elect who we please, they will keep the plutocracy in charge anyway. Bushco will still be screwing us 20 years from now.

Yeah, who's President doesn't really matter.
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by John Drake View Post
Yeh, crying liberal cow, she only paid the money all these years in pure good faith like the company told her to, what's the whiny bitch want, justice?

She either been a victim of negligence (a 'bureaucratic oversight' is a mistake, and a mistake qualifies as negligence) or, if the company never intended to pay and so deliberately didn't tell her, she's the victim of fraud. In either case she used to be able to sue for at least what she paid for but apparently, the SCOTUS now takes your view that corporations can do no wrong, so we little people are just SOL if they decide to fuck us.

Compassionate conservatism at its best. We can't rely upon our insurance but rich people can still buy guns to protect themselves from all those they've swindled out of their life savings.
You should tell the conservative partisans that I'm one of them now. They all accuse me of being a liberal when acting just like you.

But, your assuming that anyone who disagrees with you must be your idealogical twin on the other side of the fence and subsequent strawman arguments dismissed as the hysterical pap they are, you haven't really made a strong argument in the first place.

The company enacted a policy and the dying man and his wife were unaware of it, perhaps through no fault of their own. Nevertheless, he didn't meet the criteria for receiving the payout, and thus didn't.

I've made no claim to agree with the law per se. I'm only pointing out what the SCOTUS agreeing not to hear it, in this case, doesn't seem like a big deal. As I've said, there are no shortage of sob stories, and hysterically shrieking "there oughta be a law!!!" for each particular one doesn't really do the level of discourse any justice nor does it typically result in sensible policy, across the board. Perhaps I'll create a thread with gruesome images of people wearing red shirts killed in car crashes and then accuse anyone who disagrees with my assessment that that "compassionate conservatives" are fighting laws against red shirts and driving because they love guns.

Another way to look at it, in Devil's Advocate terms, is that allowing people to sue for large sums of money under these circumstances would cause all of our premiums to increase substantially.
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by John Drake View Post
The SCOTUS, like any court, can overturn laws which are against the public interest because they work at cross purposes to other laws, are manifestly unjust, "toothless" etc. Besides, didn't they just refuse to even hear the case?

The Bush appointees are telling the corps loud and clear, we, the people, can elect who we please, they will keep the plutocracy in charge anyway. Bushco will still be screwing us 20 years from now.

Yeah, who's President doesn't really matter.
From your source:
Quote:
Federal appeals courts, interpreting Supreme Court decisions dating to 1993, consistently have said companies that offer health, life and retirement benefits under ERISA cannot be sued for large amounts of money, or damages. Instead, they can be sued only for typically smaller sums such as Amschwand's insurance premiums.

Several federal judges have bemoaned the unfairness even as they have felt constrained to rule in favor of employers.

"The facts ... scream out for a remedy beyond the simple return of premiums," Judge Fortunato Benavides of the New Orleans-based 5th U.S. Circuit Court of Appeals said in the Amschwand case. "Regrettably, under existing law it is not available."

The Bush administration has argued that the appeals courts are misreading the precedents and has asked the high court at least twice to clarify the earlier rulings. So far it has refused.
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Old 07-09-2008
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John Drake John Drake is offline
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by drgoodtrips View Post
You should tell the conservative partisans that I'm one of them now. They all accuse me of being a liberal when acting just like you.

But, your assuming that anyone who disagrees with you must be your idealogical twin on the other side of the fence and subsequent strawman arguments dismissed as the hysterical pap they are, you haven't really made a strong argument in the first place.

The company enacted a policy and the dying man and his wife were unaware of it, perhaps through no fault of their own. Nevertheless, he didn't meet the criteria for receiving the payout, and thus didn't.

I've made no claim to agree with the law per se. I'm only pointing out what the SCOTUS agreeing not to hear it, in this case, doesn't seem like a big deal. As I've said, there are no shortage of sob stories, and hysterically shrieking "there oughta be a law!!!" for each particular one doesn't really do the level of discourse any justice nor does it typically result in sensible policy, across the board. Perhaps I'll create a thread with gruesome images of people wearing red shirts killed in car crashes and then accuse anyone who disagrees with my assessment that that "compassionate conservatives" are fighting laws against red shirts and driving because they love guns.

Another way to look at it, in Devil's Advocate terms, is that allowing people to sue for large sums of money under these circumstances would cause all of our premiums to increase substantially.
"Through no fault of their own" indeed, according to the story it was through the direct fault of the company, which didn't tell them of the change.

"I'm sorry I'll not be able to pay you for the work you did for me, but our new policy, which we institituted after we made a contract with you and never told you about, says everyone now works for free."

I may try this with my electric bill next month, since one side can now unilaterally change contracts in their favor I'll just tell them they were unaware that they now have to supply me for free. Just a bureaucratic oversight on my part

But then, it's not a big deal when corporations overturn the whole concept of contract and 'meeting of the minds' just when we do we still have to pay our bills anyway.

And now it damages insurance cos to make the payouts they promised? I would think Spherion and their insurer (did the article say who they were, I can't find it if they did? )would lose a lot more through the thousands who will no longer deal with them after this. Would you?

Last edited by John Drake; 07-09-2008 at 08:29 PM.
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Old 07-09-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by Mrs. M View Post
From your source:
It was Bush who APPOINTED these right wing corporate toadies, but now a few window dressing protests on his part absolves him of all responsibilty Riiigghtt.

Oh, and Congress could act on this but hasnt. OK, finally, here's one thing where I think the Democrats are as much jerks as the Republicans

Last edited by John Drake; 07-09-2008 at 08:37 PM.
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Old 07-09-2008
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Re: SCOTUS Denies Widow

I would think that Spherion would have a fiduciary responsibility to act in the best interests of the insured.
To fail to notify them of a provision which could have been easily met seems to me to be a breach of that fiduciary relationship.
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Old 07-11-2008
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by John Drake View Post
The SCOTUS, like any court, can overturn laws which are against the public interest because they work at cross purposes to other laws, are manifestly unjust, "toothless" etc. Besides, didn't they just refuse to even hear the case?

The Bush appointees are telling the corps loud and clear, we, the people, can elect who we please, they will keep the plutocracy in charge anyway. Bushco will still be screwing us 20 years from now.

Yeah, who's President doesn't really matter.
so lets get straight to the point Drake, the SC of Rehnquist was Con. see; decision of 93 and the SC is a “con” court now? I see....
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Old 08-19-2008
Marcus1124 Marcus1124 is offline
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Re: SCOTUS Denies Widow

Quote:
Jason Marcel
I don't get how ERISA works. And I don't understand why the SCOTUS can't make a company pay the benefits after reviewing the signed documents. I just don't get it. I'm not saying some corporations are greedy, I get that, but how can a judge basically throw it out?
Basically what happened here was that he was never actually entitled to the coverage under the new plan, but this was not properly communicated to him, since he was not entitled to the coverage persay, he was not entitled to equitable relief for the amount of the coverage, but merely the amount he had paid for that coverage.

Quote:
John Drake
The SCOTUS, like any court, can overturn laws which are against the public interest because they work at cross purposes to other laws, are manifestly unjust, "toothless" etc. Besides, didn't they just refuse to even hear the case?

The Bush appointees are telling the corps loud and clear, we, the people, can elect who we please, they will keep the plutocracy in charge anyway. Bushco will still be screwing us 20 years from now.

Yeah, who's President doesn't really matter.
Actually, courts (behaving properly) cannot summarily throw out a LAW based on public policy or because it conflicts with another law. They MAY deny equitable relief which may be warranted under common law, but which conflicts with public policy as reflected in statutory law (statutory law trumps common law).

As for overturning a law because it conflicts with another law, they don't get to pick and chose which stands and which falls, it is a basic principle that if there are reasonable interpretations of the two laws which would result in them not conflicting, then you cannot give either an interpretation that results in a conflict. If there is no reasonable way to interpret the two laws that would reconcile them to one another, then the one passed most recently is the one which controls.

Quote:
Birdzeye
This means that a company can deny an employee (or former employee) the benefits for which he paid, and only have to pay back the premiums paid by that employee. What a scam.
No, the distinction in this case is that the plaintiff was not in fact contractually entitled to the covereage in the first place. It wasn't that he was denied coverage due to an error, it was that he was not entitled to coverage, and was only told he was in error. That is why he was entitled to only reimbursement of the premiums he paid.

If you are covered under a plan, and you meet all the requirements for coverage, and pay your premiums, they may not summarily deny you coverage you are entitled to under the plan. If, however, your coverage was itself in error, they may deny you the benefits of that coverage provided your premiums are reimbursed.

Now, common law principles may have entitled the plaintiff to something more in the way of equitable relief, but as John Drake correctly asserted (but misapplied) Courts may, and routinely, do set aside equitable relief called for under common law if it conflicts with public policy/statutory provisions.
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Old 08-19-2008
chrisl chrisl is offline
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Re: SCOTUS Denies Widow

Quote:
Originally Posted by drgoodtrips View Post
Out of curiosity, those who think that the wife should be able to sue the insurers for exorbitant amounts of money... why do you think that?
How is suing for the amount of coverage exorbitant? There's no mention of punitive damages.

Whether I have a life insurance policy for $10 million, and post-death, the policy isn't paid, suing the insurance company for $10 million is not exorbitant. If the coverage was $1, and the company was sued for $10 million it would be exorbitant.
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