2025 ERISA Year in Review: Five Pivotal Cases Reshaping Disability and Life Insurance Litigation

The landscape of ERISA litigation saw pivotal shifts in 2025, with federal courts increasingly scrutinizing the “black box” of insurer decision-making. From the Eleventh Circuit’s landmark ruling on pre-existing condition exclusions to critical procedural victories in favor of ERISA claimants/plan participants, 2025 provided clarity—and some new rules—for those navigating disability and life insurance claims.

The following five cases represent significant developments in ERISA disability and life insurance law in 2025.

1. Johnson v. Reliance Standard Life Ins. Co., 159 F.4th 1304 (11th Cir. 2025)

The Issue: The “For Which” Trap and Unsuspected Diseases

In a decision that protects claimants with difficult-to-diagnose conditions, the Eleventh Circuit addressed whether an insurer can deny benefits by retroactively linking vague symptoms to a later-discovered disease. Cheriese Johnson sought treatment for common ailments like nausea and fatigue during her policy’s three-month “lookback period,” but her actual condition—scleroderma—was not suspected or diagnosed until months after the period ended. Reliance Standard denied her claim, arguing that these symptoms were “not inconsistent” with her eventual diagnosis.

The court ruled the denial was “de novo wrong” and “arbitrary and capricious.” The court focused on the policy’s phrase “for which,” noting that it “connotes intent” and indicates the “object, aim, or purpose of an action.” Because no one “intended or even thought” to treat Johnson for scleroderma during the lookback period, she could not have received treatment for it. The court warned that the insurer’s interpretation would “warp” the policy into a pre-existing symptom exclusion, effectively allowing denials for any condition if a doctor previously recommended something as simple as drinking more water for a headache.

2. Dharmasena v. Metropolitan Life Insurance Co., 2025 WL 1563970 (C.D. Cal. May 29, 2025)

The Issue: De Novo Review and Retroactive Disability Evidence

This case is a major win for claimants seeking past benefits, especially in jurisdictions like California that restrict discretionary clauses. Applying a de novo standard of review, the court held that a claimant could establish entitlement to long-term disability (LTD) benefits for retroactive periods if the medical evidence confirms they were disabled during those times.

Significantly, the court rejected the insurer’s argument that an absence of “continuous medical care” during a retroactive period defeated a claim. The ruling emphasizes that what matters is not the frequency of physician contact, but the “totality of reliable medical evidence” demonstrating functional incapacity during the timeframe in question. This serves as a vital precedent for individuals who may have been too ill or lacked the resources to maintain constant treatment but can still prove their disability through retrospective medical analysis.

3. Hamilton v. Logic20/20, Inc. and Prudential Ins. Co. of Am., 2025 WL 3754023 & 3754065 (W.D. Wash. 2025)

The Issue: Fiduciary Breach, Waiver, and the Salyers Precedent

In these companion orders, the Western District of Washington dealt a blow to insurers attempting to deny coverage based on technicalities that were previously overlooked. A central focus of the Hamilton litigation was the breach of fiduciary duty and the doctrine of waiver. The court looked at whether an insurer could waive its right to contest eligibility if it had already accepted premiums or acted in a way that led the participant to believe they were covered.

The court leaned heavily on the Ninth Circuit’s decision in Salyers v. Metropolitan Life Insurance Co., 871 F.3d 934 (9th Cir. 2017), which held that an insurer can waive evidence-of-insurability requirements by collecting premiums without a timely objection. By applying these principles, the Hamilton court highlighted that plan administrators have a fiduciary obligation to act in the interest of participants, and they cannot sleep on their rights regarding eligibility requirements and then retroactively deny a claim once a disability occurs.

4. Rappaport v. Guardian Life Ins. Co. of Am., 782 F.Supp.3d 109 (S.D.N.Y. 2025)

The Issue: Calculating “Insured Earnings” for Business Owners

This case remains the gold standard for disputes involving high-earners and K-1 profits. The court addressed whether an owner’s share of company profits should be included in their “insured earnings” for the purpose of calculating monthly disability benefits.

The court held that when a policy’s definition of “earnings” points to income reported for federal tax purposes, K-1 profits—provided they reflect active work rather than passive investment—must be included. However, it also reminded practitioners that the lookback timing specified in the policy (e.g., the tax year prior to disability) is strictly enforced. This case underscores the need for self-employed professionals to vet their policy definitions to ensure their actual take-home income is protected.

5. Berg v. Lincoln National Life Insurance Company, 2025 WL 252481 (E.D. Wash. 2025)

The Issue: Failure to Address Treating Physicians’ Opinions and SSA Evidence

In this claimant-friendly decision, the court granted judgment to a former Walmart employee after finding the insurer’s termination of benefits was arbitrary and capricious. The court criticized Lincoln forgoing through the motions of a review while ignoring highly persuasive evidence, including questionnaires from the claimant’s treating physician and a favorable Social Security Administration (SSA) disability determination.

Applying a de novo standard, the court gave substantial weight to the treating doctor’s opinions. It found it troubling that Lincoln and its experts failed to meaningfully consider the medical assessments or the SSA’s findings. The court’s decision to award retroactive LTD benefits serves as a stern reminder that insurers must do more than just collect paper; they must meaningfully evaluate the evidence presented by the claimant’s own doctors and favorable SSA findings.

Conclusion

The ERISA landscape of 2025 reveals a judiciary that is increasingly willing to look under the hood of insurance company operations. Whether it is the Eleventh Circuit’s linguistic takedown of pre-existing condition exclusions in Johnson or the procedural openings for discovery and waiver in Hamilton, the trend is moving toward greater transparency. For plan participants, these cases offer hope that “discretion” is not a blank check for insurers. For attorneys, they underscore the necessity of building a rigorous, evidence-based administrative record from the very first day of a claim.

What is ERISA?

The Employee Retirement Income Security Act of 1974, or ERISA, is a federal statute setting minimum standards for most pension and health plans in the private sector. This law works to protect individuals participating in these plans by ensuring plan fiduciaries manage assets properly and ethically. ERISA also grants participants the right to sue for denied benefits or fiduciary breaches. Its reach covers various employee benefit plans, including disability insurance policies, which are essential for employees relying on them during periods of illness or injury preventing work.

How Does ERISA Govern Disability Claims?

ERISA dictates the specific procedures that must be followed when someone files a disability claim and then appeals a denial. It mandates that plans provide participants with clear information about plan features and their funding. Under ERISA, disability plans must implement a fair and reasonable claims process, and participants must be fully informed about their rights to appeal any denial. The law further requires that plan administrators act in the best interests of the participants, making sure that claims are handled without bias and in a timely manner.

In California, ERISA plays a major role because many employers provide disability plans governed by this federal statute. ERISA’s preemption clause means that federal rules supersede state laws concerning employee benefit plans. This often means federal regulations take priority over any conflicting state rules. This preemption can add layers of complexity for claimants, who must then navigate federal requirements instead of relying solely on state-level protections.

What Are Pre-Existing Condition Exclusions Under ERISA?

A pre-existing condition refers to a medical condition that already existed before you enrolled in a disability plan. Under ERISA, plans often include clauses that allow them to exclude coverage for disabilities stemming from such conditions. This means that if your disability is determined to be related to a pre-existing condition, your plan might not pay out benefits. While the exact definition can differ between plans, it typically covers any condition for which you received medical advice, a diagnosis, care, or treatment before your disability coverage began. Insurers use these clauses to manage risk, aiming to prevent individuals from enrolling only after a condition has manifested.

What Are the Legal Implications of These Exclusions?

The legal ramifications of pre-existing condition exclusions under ERISA are considerable. These clauses can restrict or outright deny benefits to individuals whose disabilities are connected to health issues they had before their coverage started. This creates a major hurdle for claimants, who often need to demonstrate that their disability is either unrelated to any pre-existing condition or that the exclusion itself does not apply in their specific situation.

ERISA mandates that plan administrators offer clear, easy-to-understand explanations for any exclusions, including those for pre-existing conditions. Failing to do so can open the door to legal challenges. Claimants may contend that these exclusions were not adequately communicated, or that the plan’s interpretation of what constitutes a pre-existing condition is excessively broad.

How Do Pre-Existing Condition Exclusions Affect My Disability Claim?

Individuals filing claims in Newport Beach, CA, and nearby communities may encounter various challenges because of pre-existing condition exclusions. A primary issue is the potential denial of benefits if the plan administrator concludes that your disability stems from a condition you had before your coverage began. Beyond a straightforward denial, claimants might struggle with collecting enough medical evidence to counter the exclusion. The dense, often confusing language within plan documents can also make it difficult to fully grasp the specific terms and conditions that apply to your situation.

Another hurdle is the possibility of extended and arduous appeals. If your claim is denied because of a pre-existing condition exclusion, you will need to navigate the plan’s internal appeals process. This often demands considerable time, detailed documentation, and well-reasoned arguments to present your case effectively.

How Can I Prepare My Claim to Address These Challenges?

To effectively address these potential challenges, claimants should start by meticulously reviewing their plan documents. This step helps you understand the exact terms and conditions related to pre-existing conditions, including any “look-back” periods or specific definitions used by your plan. Collecting a complete set of medical records and documentation is also essential. This evidence should clearly show either the absence of a pre-existing condition or, if one exists, that there is no causal connection between that condition and your current disabling condition.

Seeking additional medical opinions from healthcare providers who can advocate for your case is another smart strategy. These professional opinions can prove instrumental when challenging a denial based on a pre-existing condition exclusion. Furthermore, gaining a clear understanding of the entire appeals process and preparing a thorough, well-documented appeal package can considerably improve your chances of a favorable outcome.

What Legal Precedents Exist Regarding ERISA’s Pre-Existing Condition Exclusions?

In Johnson v. Reliance Standard Life Insurance Company, 159 F.4th 1304 (11th Cir. 2025), the Eleventh Circuit addressed whether a disability claim could be denied under a “pre-existing condition” exclusion when the disabling condition was neither diagnosed nor suspected during the policy’s lookback period. Cheriese Johnson sought long-term disability benefits for scleroderma, a rare autoimmune disease. Reliance Standard denied her claim, citing a policy provision that excluded benefits for a sickness “for which” an insured received treatment during a three-month lookback window. Although Johnson had visited several doctors during that period for vague symptoms like nausea, fatigue, and joint swelling, no medical professional suspected scleroderma until months after her coverage began. Reliance argued that because her early symptoms were not “inconsistent” with the eventual diagnosis, the disease qualified as a pre-existing condition.

The Court of Appeals reversed the district court’s grant of summary judgment to the insurer, finding the denial was “de novo wrong” and “arbitrary and capricious”. The court’s reasoning focused on the phrase “for which,” noting that the word “for” connotes intent and purpose. It held that a doctor cannot provide treatment “for” a specific condition without knowing or at least suspecting that the condition exists. The court rejected the insurer’s interpretation as unreasonable, stating that allowing such “backward-looking reinterpretation” of non-specific symptoms would effectively warp the policy into a “pre-existing symptom” exclusion. By requiring an implicit intent requirement in the treatment, the court prevented insurers from retroactively linking general ailments to later diagnoses to avoid paying contractually defined benefits.

How Have These Cases Influenced Current Practices?

These landmark cases have helped to foster greater transparency and fairness in the management of ERISA-governed plans. They have prompted a closer examination of decisions made by plan administrators and have strengthened claimants’ abilities to dispute denials, including those based on pre-existing condition exclusions.

Courts now give more attention to potential conflicts of interest and insist that plan administrators present clear and compelling evidence to back up their benefit decisions. This has led to a more equitable approach to handling disability claims, ensuring claimants have a fair chance to present their arguments and evidence.

How Can I Navigate the Complexities of ERISA’s Pre-Existing Condition Exclusions?

To build a robust disability claim under ERISA, your primary focus should be on collecting thorough evidence and documentation. This involves obtaining all relevant medical records, such as physician notes, test results, and treatment plans. It also means securing expert medical opinions from treating doctors or independent specialists who can clearly articulate your diagnosis, limitations, and any lack of connection to an alleged pre-existing condition. Make sure all your submitted documentation is consistent and strongly supports your claim for benefits. A deep understanding of your specific plan’s language, particularly how it defines and applies pre-existing conditions, is also essential.

Being proactive in your communications with plan administrators is another key strategy. Do not hesitate to ask for clarification on any terms or conditions that seem unclear. Always keep meticulous records of every conversation, email, and document exchange with the plan. This detailed log can prove highly beneficial should any dispute arise later in the process.

When Should I Seek Legal Assistance?

It is wise to seek legal assistance when you are facing challenges related to pre-existing condition exclusions under ERISA, or if your claim has been denied. Legal professionals who specialize in ERISA litigation can offer expert guidance and strong representation. They can help you understand the intricate details of the law, assist in gathering compelling evidence, communicate with plan administrators on your behalf, and skillfully navigate the often-complex appeals process, even pursuing litigation if necessary.

If you live in Newport Beach or the surrounding areas and need assistance with your disability claim, consider reaching out to McKennon Law Group PC. Our firm has over 70 years of combined experience in ERISA litigation, and we are committed to providing focused and effective representation. Click to call us today at 949-504-5381 for a free, confidential consultation.

The Employee Retirement Income Security Act (ERISA) provides courts with discretionary authority to award reasonable attorney’s fees to parties who achieve “some degree of success on the merits” in benefits litigation. The recent decision in Daniel C. v. Chevron Corp., U.S. Dist. LEXIS 103623 (N.D. Cal. May 20, 2025) illustrates the evolving judicial approach to determining when a remand order constitutes sufficient success to warrant a fee award, while also demonstrating how courts balance limited victories against the remedial purposes of ERISA. This case provides valuable guidance for practitioners navigating the intersection of procedural victories and substantive success in ERISA litigation.

Factual Background and Procedural History

The Plaintiff in this case initially applied for short-term disability benefits due to major depressive disorder and occupational problems. After ReedGroup approved his initial claim from October through December 2017, the Plaintiff suffered a traumatic brain injury in a motor vehicle accident on December 31, 2017. ReedGroup subsequently approved extensions for short-term disability and granted long-term disability benefits from April 2, 2018 through June 30, 2020, totaling 27 months of coverage.

The critical juncture arose when ReedGroup denied the plaintiff’s continued long-term disability benefits starting July 1, 2020. Under the plan’s terms, employees must satisfy the usual occupation standard for the first 24 months, but thereafter must meet the more stringent “Any Occupation” standard to continue receiving benefits. On the parties’ cross-motions for summary judgment, the Court held that Chevron failed to demonstrate that it made a valid delegation of authority to ReedGroup and, thus, the Court would review ReedGroup’s denial of Plaintiff’s benefits de novo. However, as the parties agreed, the Court could not conduct a de novo review on a motion for summary judgment. Instead, the Court conducted that review at the bench trial. On the parties’ cross-motions for judgment under Federal Rule of Civil Procedure 52(a) the Court held that ReedGroup erred in failing to conduct a vocational analysis and remanded this case for further proceedings in accordance with that Order. While the Court ultimately concluded that ReedGroup erred and remanded Plaintiff’s claim for benefits for further review, the Court noted that the Order was not uniformly in favor of Plaintiff’s positions. The Court rejected Plaintiff’s argument that the Court should consider extra-record evidence. Thus, the Court’s review could not include the audiological evaluation by Dr. Samantha Nieves that was not part of the administrative record. The Court also rejected Plaintiff’s argument that Court could not consider medical documentation that ReedGroup did not specifically discuss, such as Plaintiff’s June 4, 2019 CT scan. Instead, the Court held that it must review all supporting medical documentation to determine whether ReedGroup correctly found it inadequate to show Plaintiff was disabled under the newly applicable “Any Occupation” standard.

Thus, the Court concluded that it could not determine whether Plaintiff meets the disability definition under the Plan without any vocational analysis and remanded Plaintiff’s claim to ReedGroup for an initial factual determination based on the record with additional vocational evidence. Plaintiff filed a motion for attorney’s fees and to amend the judgment to include an award of benefits pending ReedGroup’s determination of Plaintiff’s disability benefits on remand.

The Legal Standard for ERISA Attorney’s Fees

ERISA’s attorney’s fee provision, codified at 29 U.S.C. § 1132(g)(1), grants courts discretionary authority to award reasonable attorney’s fees to parties who demonstrate some degree of success on the merits Gross v. Sun Life Assurance Co. of Can., 880 F.3d 1 (1st Cir. 2018). The Supreme Court’s decision in Hardt v. Reliance Standard Life Insurance Co. established that fee claimants need not be prevailing parties in the traditional sense, but must achieve more than “trivial success on the merits or a purely procedural victory.” Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010).

As the Court explained in Daniel C., a party satisfies this requirement if the court can fairly call the outcome of the litigation some success on the merits without conducting a lengthy inquiry into the question whether a particular party’s success was substantial or occurred on a central issue. This standard reflects Congress’s failure to “abandon historic fee-shifting principles and intuitive notions of fairness” in drafting the ERISA fee provision Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010).

Remand as Success on the Merits

The Daniel C. court joined the growing consensus of federal courts that recognize remand orders as constituting success on the merits under the Hardt standard. The court noted that most courts have, in the wake of Hardt determined that a remand to a plan administrator – by itself – does in fact constitute some success on the merits. This conclusion aligns with decisions which found that a remand for further administrative proceedings is not a trivial success where it is based on a court determination that ERISA rights were violated.

The court’s analysis focused on whether the remand represented a meaningful benefit to the fee-seeker rather than a mere procedural victory. In this case, the court determined that the reversal of the determination of denial and the remand for consideration with a vocational analysis constitutes a sufficient degree of success to warrant attorney’s fees. This holding reflects the practical reality that remand orders often provide plaintiffs with renewed opportunities to obtain benefits that were previously denied.

Application of the Hummell Factors

For cases where a party achieves some success but does not prevail completely courts apply the five-factor analysis established in Hummell v. S.E. Rykoff & Co., 634 F.2d 446, 453 (9th Cir. 1980). These factors examine: (1) the opposing parties’ culpability or bad faith; (2) their ability to satisfy a fee award; (3) whether an award would deter similar conduct; (4) whether the requesting party sought to benefit all plan participants or resolve significant ERISA questions; and (5) the relative merits of the parties’ positions.

The Ninth Circuit has emphasized that application of the Hummell actors must recognize the remedial purpose of ERISA in favor of participants and beneficiaries in cases where participants must resort to litigation to recover wrongfully withheld benefits. While the Daniel C. court did not extensively analyze each Hummell factor, the decision to award fees suggests that these considerations supported the Plaintiff’s position, particularly given ERISA’s participant-protective purposes.

Limited Success and the Fifty Percent Reduction

Despite finding that the remand constituted success on the merits, the court significantly reduced the Plaintiff’s fee award, cutting the lodestar amount by fifty percent. The court applied the framework, which requires courts to consider whether the plaintiff failed to prevail on unrelated claims and whether the level of success makes the hours expended a satisfactory basis for a fee award.

The Court found that while there were no unrelated claims in the case, Plaintiff’s success was limited. Specifically, the court noted that it “only remanded on the narrow issue of requiring a vocational analysis” and that the “Plaintiff was unable to demonstrate that the medical evidence established that he was disabled.” The Court emphasized that it did not find that defendant “engaged in any egregious or obviously inappropriate conduct” and that the determination requiring a vocational analysis “was not a foregone conclusion based on the facts of this case.”

This reduction reflects the Court’s calibration of fee awards to match the degree of success achieved. The Court awarded a total of $92,463.75 in attorney’s fees, representing exactly half of the original lodestar calculation of $184,927.50. The Court found the requested hourly rates of $600 and $850 reasonable, as well as the total hours expended.

Broader Implications for ERISA Litigation

The Daniel C. decision contributes to the developing body of law recognizing that remand orders can constitute meaningful success under ERISA’s fee-shifting provision. This trend encourages vigorous enforcement of ERISA’s protections by ensuring that participants who successfully challenge flawed benefit determinations can recover their legal costs, even when they do not obtain immediate benefit awards.

However, the Court’s fifty percent reduction demonstrates judicial awareness of the need to calibrate fee awards appropriately. Courts must balance ERISA’s remedial purposes against the risk of excessive fee awards for limited victories. The Daniel C. approach suggests that while remand orders generally satisfy the Hardt standard, the scope and significance of the remand will influence the ultimate fee calculation. While the fifty percent reduction reflects the limited nature of the plaintiff’s success, the underlying fee award validates the importance of vigorous advocacy in ERISA benefits litigation and supports the statute’s participant-protective purposes. Future courts will likely continue to grapple with the appropriate balance between encouraging ERISA enforcement and ensuring that fee awards remain proportionate to the success achieved.

The recent decision in 2025 U.S. Dist. LEXIS 103623 (N.D. Cal. May 20, 2025), highlights the complexities of ERISA litigation, particularly regarding delegation of discretionary authority and the implications for judicial review. This blog explores the facts, legal holdings, and broader implications of the court’s ruling.

Case Background: From Disability to Dispute

Daniel C., a Chevron employee, initially sought short-term disability leave in October 2017 due to major depressive disorder and workplace conflicts. Chevron’s third-party claims administrator, ReedGroup, approved the request. However, Daniel’s circumstances changed dramatically when he was struck by a vehicle on December 31, 2017, resulting in a traumatic brain injury and a ten-day coma. In June 2018, Daniel applied for long-term disability (LTD) benefits, citing his brain injury as the primary cause of his disability. ReedGroup approved the benefits through June 2020 but later denied further benefits, citing insufficient medical documentation and the exhaustion of mental health-related disability limits. The parties agreed that Chevron’s plan document vested the company with discretionary authority and permitted delegation of that authority. However, they disagreed about whether Chevron had properly delegated such authority to ReedGroup. This distinction proved crucial, as proper delegation would result in deferential arbitrary and capricious review, while improper delegation would trigger the more demanding de novo standard.

Delegation of Authority: A Procedural Misstep

One of the central issues in the case was whether Chevron had properly delegated discretionary authority to ReedGroup, which would determine the standard of judicial review. Under ERISA, courts apply de novo review to benefit denials unless the plan explicitly grants discretionary authority to the administrator. While Chevron’s plan document allowed for delegation, the court found that Chevron failed to meet ERISA’s requirement for a written instrument specifying the fiduciary responsibilities delegated to ReedGroup.

The court’s analysis focused on ERISA’s specific requirements for delegating fiduciary responsibilities. Under federal law, any delegation of fiduciary responsibilities must occur pursuant to a written instrument that specifies the fiduciary responsibilities so delegated to each such person. The court emphasized that naming ReedGroup in the Summary Plan Description (SPD) alone could not satisfy this requirement.

The court relied heavily on the Supreme Court’s decision in CIGNA Corp. v. Amara, 563 U.S. 421 (2011), which established that SPDs do not themselves constitute the terms of the plan. The court distinguished the case from Mull v. Motion Picture Industry Health Plan & Bd. of Dirs. of MPI Health Plan, 2019 U.S. Dist. LEXIS 212081, where the Ninth Circuit found an SPD could constitute plan terms, noting that in Mull there was no separate plan document and the SPD explicitly stated it constitutes both the Plan document and the Summary Plan Description.

Thus, even though Chevron argued that the SPD functions as the designation instrument, communicating to plan participants the name of the entity that serves as the claims administrator and decides all claims, the court rejected this argument, finding that the SPD could not function as the delegation instrument because it did not specify the fiduciary responsibilities delegated to ReedGroup. The court emphasized that naming ReedGroup in the SPD was insufficient to constitute a valid delegation. The SPD lacked specific language identifying the fiduciary responsibilities delegated to ReedGroup, and the court noted that SPDs are not formal plan documents under ERISA unless they specifically state that they are part of the plan documents. See Krebsbach v. Travelers Pension Plan, 2024 U.S. Dist. LEXIS 206671; Collins v. Life Ins. Co. of N. Am., 2023 U.S. Dist. LEXIS 50683. This failure to properly delegate authority in the plan itself, as opposed to the SPD, led the court to apply de novo review, a more rigorous standard that favors claimants.

Implications of De Novo Review

The court’s decision to apply de novo review stripped ReedGroup’s denial of benefits of the deference typically afforded under the arbitrary and capricious standard. Under de novo review, the court independently evaluates the evidence without deferring to the administrator’s decision. This shift in the standard of review often benefits claimants, as it allows for a more thorough examination of the evidence supporting their claims.

The court’s ruling also underscores the importance of compliance with ERISA’s technical requirements for delegation. Plan sponsors must ensure that any delegation of discretionary authority is clearly documented in a formal written instrument that meets ERISA’s standards.

Broader Implications for Plan Administrators

This case serves as a cautionary tale for plan administrators and sponsors. The court’s strict interpretation of ERISA’s delegation requirements suggests that informal arrangements or general references in SPDs will not suffice. Plan sponsors must carefully document delegation arrangements to avoid procedural pitfalls that could lead to unfavorable judicial review standards. Additionally, the decision highlights the potential financial consequences of procedural missteps.

Procedural Outcome and Next Steps

The court’s denial of summary judgment for both parties reflects the complexity of the issues and the need for further factual development under the de novo standard. The case has been remanded for additional proceedings, with a hearing scheduled for August 2025. This procedural outcome demonstrates the challenges of resolving ERISA disputes, particularly when the standard of review is contested.

Conclusion: Lessons for Practitioners

The decision underscores the importance of precision in ERISA delegation procedures and the potential impact of procedural victories in litigation. For plan sponsors, the case serves as a reminder to ensure compliance with ERISA’s technical requirements to avoid unfavorable outcomes. For claimants, the decision highlights the value of pursuing procedural challenges, as even partial success can lead to significant advantages, including attorney’s fees, which were awarded in a later decision by the Court. As ERISA litigation continues to evolve, practitioners must remain vigilant in navigating the procedural and substantive complexities of these cases.

California Insurance Code § 10110.6 has long been a battleground in ERISA litigation. The statute voids provisions that grant an insurer or administrator discretionary authority to interpret plan terms or decide eligibility for benefits. While courts have applied § 10110.6 routinely to life and disability insurance, federal district courts have split on whether it also reaches health insurance plans. In Torres v. Emsurgcare (unpublished Ninth Cir. 2025), the Ninth Circuit Court of Appeals came down on the side that health insurance is covered—adding weight to the growing view that § 10110.6 is not limited to life and disability. This matters because once the discretionary clause is void, courts review denials de novo, not under a deferential abuse-of-discretion standard.

The plaintiff, covered under a group health plan, challenged the denial of benefits and argued that because the plan was delivered in California and contained a discretionary clause, the clause was void under § 10110.6 and the court should apply de novo review. UnitedHealthcare Insurance Company (“United”) countered that § 10110.6 was limited to life and disability insurance. The court rejected this narrow reading, holding that the statute’s broad language and decisions by the California Courts of Appeal support its application to all insured health policies issued or delivered in California.

The Court held that California’s intermediate appellate courts have repeatedly observed that health insurance is a form of disability insurance for purposes of the California Insurance Code. See, e.g., Ticconi v. Blue Shield of Cal. Life & Health Ins. Co., 160 Cal.App. 4th 528, 539 n.7 (2008), petition for review denied, 2008 Cal. LEXIS 7013 (June 11, 2008) (“[H]ealth insurance … is a type of disability insurance.”); Nieto v. Blue Shield of California Life & Health Ins. Co., 181 Cal.App.4th 60, 79 n.4 (2010) (“[H]ealth insurance is a type of disability insurance.”); Blue Shield of California Life & Health Ins. Co. v. Superior Ct., 192 Cal.App.4th 727, 733 (2011) (“Health insurance policies are considered a form of disability insurance.”).

Although Torres departs from decisions like Bain v. United Healthcare, 2016 WL 4529495, at *7 (N.D. Cal. Aug. 30, 2016) which declined to apply § 10110.6 to health policies, it reinforces a growing body of authority supporting a broader interpretation of the statute in line with its plain language and purpose. For ERISA litigants in California, particularly those challenging denials under insured health plans, Torres provides strong support for invoking § 10110.6 to seek de novo review—often a critical factor in the outcome of benefit disputes.

The U.S. District Court for the Central District of California recently granted long-term disability (“LTD”) benefits to Plaintiff Hettihewage Dharmasena following an ERISA appeal in Dharmasena v. Metropolitan Life Insurance Co., __ F. Supp. 3d __, 2025 WL 1563970 (C.D. Cal. May 29, 2025). This decision offers important guidance on how courts evaluate disability claims under de novo review, address disputes over the onset of disability, and treat claims for retroactive disability periods.

Mr. Dharmasena was employed as a technical professional covered under a group LTD policy administered by MetLife. After developing progressive orthopedic and neurological impairments, including degenerative disc disease and chronic pain, he stopped working on February 4, 2022, and submitted a claim for LTD benefits. MetLife denied the claim, asserting that his disability began on February 7, 2022—after his February 4 termination—making him ineligible for benefits because he was not “in active service” when his disability commenced.

Under the plan, Mr. Dharmasena was required to demonstrate that, due to sickness or injury, he was unable to perform the material and substantial duties of his regular occupation while still covered under the policy. Despite extensive medical documentation showing significant functional limitations, MetLife determined that he was not disabled within the meaning of the plan and denied the claim. On appeal, MetLife upheld its denial, maintaining that the evidence did not establish a qualifying disability prior to the termination date.

Mr. Dharmasena then filed suit under ERISA § 502(a)(1)(B), challenging both MetLife’s interpretation of the plan and its evaluation of the evidence. The court applied a de novo standard of review, meaning it independently assessed the administrative record without deference to MetLife’s decision. Under this standard, the burden remained on the plaintiff to prove by a preponderance of the evidence that he was both disabled and covered under the plan. The court found that the medical evidence—physician notes, diagnostic findings, and consistent reports of pain and functional decline—demonstrated that Mr. Dharmasena was disabled within the meaning of the policy prior to his termination.

Significantly, the court addressed the treatment of retroactive disability periods. It held that an ERISA claimant may establish entitlement to LTD benefits for past periods of disability if the medical evidence shows that he was disabled during those times, even if the claim is filed later or the claimant was not under continuous medical care. Rejecting MetLife’s argument that the absence of ongoing treatment during the retroactive period defeated the claim, the court emphasized that what matters is not continuous physician contact, but the totality of reliable medical evidence showing functional incapacity during the relevant timeframe.

The court’s analysis is particularly important for claimants who may be unable to promptly submit claims due to the very nature of their impairments. The decision confirms that ERISA permits retroactive awards where credible, contemporaneous medical documentation demonstrates disability—even if gaps in treatment exist. The ruling reinforces that a lack of ongoing visits during the claimed period does not necessarily negate disability; the key question is whether the record, taken as a whole, supports that the claimant met the policy’s definition of disability.

By awarding LTD benefits to Mr. Dharmasena, the court reaffirmed the central role of objective medical evidence and fair evaluation in ERISA litigation. The case underscores that plan administrators cannot deny valid claims based on hypertechnical timing arguments or procedural formalities when the medical record clearly establishes disability during the coverage period. For ERISA claimants and practitioners, Dharmasena provides clear and persuasive authority supporting retroactive disability determinations grounded in the substance of the evidence rather than rigid procedural timelines.