United States District Court, W.D. North Carolina, Statesville Division
Attorneys for Plaintiff Bryan L. Tyson N.C. Bar No. 32182
Rachel C. Matesic N.C. Bar No. 50516 Marcellino & Tyson,
Attorney for Defendants Lia Lesner N.C. Bar No. 36895 Vance
Drawdy Pro hac vice Ogletree, Deakins, Nash, Smoak &
CONSENT JUDGMENT AND ORDER
C. MULLEN UNITED STATES DISTRICT JUDGE.
Christopher Stortz (“Plaintiff”), has filed a
Complaint in the above-captioned action (the
“Action”) against Defendants Cherokee Insurance
Company (“Cherokee”), Central Transport LLC
(“Central Transport”), and Central Transport LLC
Welfare Benefit Plan (the “Plan”) (collectively
the “Defendants”). Plaintiff and Defendants have
agreed to resolve all matters in controversy in this Action
and any proceedings related thereto except for (i) the amount
of attorneys' fees and costs to which Plaintiff is
entitled under Section 502(g)(1), 29 U.S.C. § 1132(g)(1)
of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), and (ii) if Plaintiff seeks an
award of prejudgment and post-judgment interest on the amount
of the benefit claims from his hospitalization as referenced
in paragraph I below, whether Plaintiff is entitled to such
an award. Plaintiff and Defendants now consent to entry of a
Judgment and Order by this Court in accordance herewith as
Court has subject matter jurisdiction of this Action pursuant
to ERISA, Section 502(e)(1), 29 U.S.C. §1132(e)(1)
because Plaintiff is seeking benefits and other relief under
an employee welfare benefit plan and under 28 U.S.C.
§1331 because the matter arises under the laws of the
United States. Venue is appropriate under ERISA, Section
502(e)(2), 29 U.S.C. §1132(e)(2).
Plan is an employee welfare benefit plan sponsored by Central
Transport and governed by ERISA. Cherokee fully insures the
group health benefits provided through the Plan. Central
Transport is the “administrator” of the Plan, as
that term is defined under ERISA §3(16), 29 U.S.C.
§1102(16). As Plan Administrator of the Plan, Central
Transport is a fiduciary of the Plan as defined in ERISA
§3(21), 29 U.S.C. §1002(21).
Cherokee makes benefits determinations under the Plan and is
therefore a fiduciary of the Plan, as defined in ERISA
§3(21), 29 U.S.C. §1002(21), with respect to that
2014, Plaintiff was a participant in the Plan. He submitted
benefit claims to Cherokee arising from his hospitalization
and treatment in November 2014. Cherokee paid some of the
claims, but it also denied some of the benefit claims.
Plaintiff appealed the denied claims and Cherokee upheld its
decision. Plaintiff exhausted his Plan administrative
After Plaintiff exhausted his Plan administrative remedies,
Defendants did not provide Plaintiff with the opportunity for
an external review of his denied claims, as required by
his Complaint, Plaintiff's first claim for relief sought
group health benefits under the Plan pursuant to ERISA §
502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B).
Plaintiff's second and third claims for relief alleged
that the Plan contained no provision providing for an
external review of group health claims by an external review
organization (“ERO”) as required by ERISA and
applicable regulation(s), that he and other Plan participants
were not provided required notices concerning external review
rights, and that he and other Plan participants were not
provided an opportunity for external review by an ERO,
seeking relief for breach of fiduciary duty under ERISA
Sections 502(a)(2), 29 U.S.C. § 1132(a)(2), and
502(a)(3), 29 U.S.C. § 1132(a)(3) against Central
Transport as the Plan administrator and a fiduciary, and
against Cherokee as a fiduciary.
Plaintiff's fourth claim for relief pled a claim for
attorneys' fees under ERISA § 502(g), 29 U.S.C.
§ 1132(g) against all Defendants.
After service of the Summons and Complaint, Cherokee offered
an external review of the denied claims by an ERO and
Plaintiff agreed. The Court granted the parties' joint
motion and stayed the matter pending the ERO review. (Dkt.
No. 12.) The ERO concluded that the claims arising from
Plaintiff's hospitalization in November 2014 were payable
under the Plan. As a result of this determination by the ERO,
Cherokee admits that Plaintiff is entitled to benefits under
ERISA §502(a)(1)(B), 29 U.S.C. §1132(a)(1)(B) for
the benefit claims Plaintiff submitted to Cherokee arising
from his hospitalization and treatment in November 2014
(i.e., those claims submitted to the ERO). Cherokee
represents to the Court and Plaintiff that it has paid all
the outstanding claims from Plaintiff's hospitalization.
J. As a
result of Plaintiff's Action, the Plan documents were
amended effective November 1, 2017 to address external review
rights in accordance with ERISA and applicable regulation(s)
and to ...