http://www.hgdlawfirm.com/allstate-laws ... plaint.pdf
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DIVISIONGARNET TURNER, individually
and on behalf of all others similarly
2313 SEP23 A U: O
CASE NO:02 f3 .c (D s-,nF
ALLSTATE INSURANCE COMPANY,
Defendant.CLASS ACTION COMPLAINT
The Plaintiff, by and through his attorneys, hereby brings this civil action for
declaratory judgment, injunctive relief, breach of fiduciary duty, and other relief.
He brings the action individually and on behalf of all others similarly situated,
pursuant to the Federal Rule of Civil Procedure 23, and alleges upon personal
knowledge, information, and belief as to those similarly situated as follows:
1. The Plaintiff and the members of the Class he proposes to represent
are entitled to relief for these reasons: (1): the Defendant, Allstate Insurance
Company ("Allstate"), has engaged in deceptive activities which are: (a) inimical
to the Plaintiff and Class, and (b) due to be declared unlawful, and (2) Allstate, by
engaging in the wrongdoing alleged, has obstructed and continues to obstruct
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 1 of 19Federal Law, in violation of the Employee Retirement Income Security Act of
1974 ("ERISA") section 502(a)(3). An order restraining Allstate from such
obstruction is due, as is a judgment for other equitable relief and for attorneys'
2. This Action arises under ERISA section 502(a)(3). Plaintiff is not
bringing a cause of action under ERISA section 501 (a)( 1 )(b) and therefore has a
cause of action under the catch-all provision of 502(a)(3).
PARTIES, JURISDICTION, AND-VENUE
3. Plaintiff Garnet Turner is an adult resident and citizen of the State of
Alabama who resides, and resided at all times material, in Montgomery, Alabama,
which is in Montgomery County. The activities he complains of have been
directed against him by Allstate in Montgomery County.
4. According to the Alabama Secretary of State, Defendant Allstate
Insurance Company is incorporated in the State of Illinois and maintains its
principal place of business in the State of Illinois. It is a citizen of the State of
Illinois according to 28 U.S.C. § 1332. It may be served for process at its agent for
service: CT Corporation System, 2 North Jackson Street Suite 605, Montgomery,
5. This Court has original and/or exclusive jurisdiction over this action
because Plaintiff asserts a claim for benefits due under an employee welfare benefit plan that is provided by Allstate. Jurisdiction over this action is based upon
28 U.S.C. § 133 1, federal subject matter jurisdiction. The claims in this case arise
6. This Court has personal jurisdiction over Allstate, because, inter a/ia,
it maintains and has maintained sufficient minimum contacts with and in the State
of Alabama at all times material to this action.
7. The events complained of in this lawsuit occurred in this judicial
district, making venue here proper. The benefits at issue in this action would have
been or were to be received in Montgomery County, Alabama and the breach of
fiduciary duty and tortuous conduct occurred in Montgomery County, Alabama.
CLASS ACTION ALLEGATIONS
8. Plaintiff brings this action on behalf of himself and others similarly
situated as a class action pursuant to Rule 23 of the Federal Rules of Civil
Procedure. The Class which Plaintiff seeks to represent is composed of and
a. All Allstate Insurance Company retirees that were provided or
are provided life insurance benefits at no cost to the retiree but who have
received notice or will receive notice that they will no longer be provided
life insurance benefits at no cost to the retiree after December 31, 2015.
9. Plaintiff seeks to represent a subclass defined as the following:
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 3 of 19a. All Allstate Insurance Company retirees that received a
promise or representation from Allstate that they would be provided life
insurance benefits at no cost to the retiree for life.
10. The following persons are excluded from the definition of the Class:
a. U.S. District Court judges, magistrate judges of any U.S.
District Court, judges of the U.S. Court of Appeals for the Eleventh Circuit,
and U.S. District Court personnel having any involvement with
administration and/or adjudication of this lawsuit;
b. Class counsel and their employees; and
C. Employees of Metlife or Minnesota Life Insurance Company
who insured the Allstate Retiree Life Insurance Plan.
11. This action has been brought and may properly be maintained as a
class action pursuant to the provisions of the Federal Rules of Civil Procedure, for
a. Members of the Class are geographically distributed and so
numerous that their joinder is impractical; and
b. Common questions of law or fact exist as to all members of the
Class and predominate over any questions affecting only individual Class
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 4 of 19members. Some common questions include, but are not limited to, the
(i) Whether Allstate violated ERISA by unilaterally
and arbitrarily cancelling Plaintiff's and the Class's Allstate
paid retiree life insurance benefits;
(ii) Whether Allstate breached its fiduciary duties
under ERISA Section 502(a)(3) by engaging in a systemic
pattern of misrepresentation that caused Plaintiff and the Class
to rely to their detriment that their retiree life insurance would
be paid for life by Allstate;
(iii) Whether Plaintiff and the Class are entitled to an
order enjoining Allstate from cancelling the Allstate paid retiree
life insurance benefits;
(iv) Whether the Plaintiff and Class are entitled to (1)
declaratory judgment in their favor, (2) an injunction restraining
Allstate from such violations of law, (3) other equitable relief,
and (4) an attorney fee as provided for under ERISA.
C. Plaintiff's claims are typical of the claims of the members of
the Class under Federal Rule of Civil Procedure 23. Each member of the
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 5 of 19Class currently receives life insurance which historically has been provided
at no cost to the Allstate retiree. Each member of the Class has received, or
will receive, notice that Allstate will cease providing this important benefit
effective December 31, 2015, giving the putative class an option to purchase
new coverage at their own cost - a radical departure from the benefits
previously provided, promised, and represented. The claims of the Plaintiff
and the Class arising out Of Allstate's actions are identical.
d. The Plaintiff will fairly and adequately protect the interest of
the Class as required by Fed.R.Civ.P. 23. The Plaintiff has no interest which
is adverse to the interest of the Class. The Plaintiff has retained counsel who
has substantial experience in the prosecution of class actions.
e. The prosecution of separate actions by individual members of
the Class would create the risk of (i) inconsistent or varying adjudications
with respect to individual members of the Class which would establish
incompatible standards of conduct for Allstate; or (ii) adjudications with
respect to individual members of the Class which would as a practical matter
be dispositive of the interest of the other members not parties to the
adjudication or substantially impair or impede their ability to protect their
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 6 of 19f. Pursuant to Fed.R.Civ.P. 23(b)(2), Allstate has acted or refused
to act on grounds generally applicable to, and causing injury to, the Plaintiff
and Class, and, therefore, declaratory and injunctive is appropriate.
g. The questions of law or fact common to the Class predominate
over questions affecting only individual members. A class action is superior
to all other available methods for the fair and efficient adjudication of this
controversy under Fed.R.Civ.P. 23. The harm suffered by many individual
members of the Class may not be great enough to warrant the expense and
burden of individual litigation, which would make it difficult or impossible
for individual members of the Class to redress the wrongs done to them.
Individualized litigation would also present the potential for inconsistent or
contradictory judgments and would magnify the delay and expense to all
parties and the court system in multiple trials of the complex factual issues
of the case. By contrast, the conduct of this action as a class action presents
far fewer management difficulties, conserves the resources of the parties and
the court system, and protects the rights of each class member.
12. The Plaintiff began working for Allstate Insurance Company as an
employee agent in 1963. He grew his book of business supporting Allstate and its
customers for the next 32 years until which time he retired. He retired in 1995
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 7 of 19after achieving the Life Achievement Award, being a member of the Honor Ring
for 32 years, and being a member of the National Conference Champions for 32
years. Upon his retirement, Allstate represented and promised to provide Plaintiff
with $90,000 of life insurance to continue in effect for the remainder of his life at
no additional cost to him.
13. Allstate elected to provide certain employees, upon retirement, a
company paid Life Insurance benefit under its Group Life and AD&D Insurance
Plan ("Plan"). The Plan Administrator, appointed by Allstate, is as follows:
Employee Benefits Division Director
Allstate Insurance Company
2775 Sanders Road, Suite F5
Northbrook, IL 60062-6127
The Plan provides that the Plan Administrators, "as the claims fiduciary, have the
authority to determine all questions arising under the provisions of the Plan,
including the power to determine the rights and eligibility of participants or any
other persons, and to remedy ambiguities, inconsistencies or omissions."
14. The Plan section entitled "WHEN YOU RETIRE" provides Allstate
retirees with "Retiree Life Insurance." Regular full-time or regular part-time
employees who retired in accordance with Allstate's retirement policy who were
continuously insured under the Plan, and began that insurance after September
1 1 1987, for ten or more years immediately prior to retirement were entitled to the
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 8 of 19employee's Qualified Annual Earnings at the time of retirement, but no more than
15. The same section provides that Regular full-time or regular part-time
employees who were insured under the Plan on August 31, 1987, continued their
life insurance coverage after September 1, 1987, and who were continuously
insured under the Plan for ten or more years immediately prior to retirement were
entitled to more benefits. Specifically, these employees were entitled to the greater
of (1) 40% of the amount insured for as of August 31, 1987, but not more than
$100,000, or (2) one times the employee's Qualified Annual Earnings on the date
of retirement, but no more than $109000.
16. Allstate further provided under this section that "Retiree Life
Insurance is provided at no further cost to you [the retiree]."
17. Plaintiff was insured under the Plan prior to September 1, 1987. For
over 32 years while Plaintiff was a faithful regular full-time employee agent he
continuously maintained his life insurance policy until retirement. Upon
retirement, on or about 1995, Plaintiff's self-paid life insurance converted to
Retiree Life Insurance and Allstate began paying the premiums as the Plan
provides and as Allstate promised and represented.
18. Throughout Plaintiff s employment, Allstate represented and
promised that Plaintiff and other retirees would receive retiree life insurance
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 9 of 19benefits paid for by Allstate until death. The promises and representations were
made by Plaintiffs superiors and managers who were in seniority positions so that
Plaintiff understood they were acting on behalf of the Allstate Plan administrator.
It was routinely represented to Plaintiff that Allstate would pay, for life, the
premiums associated with the life insurance he was provided upon his retirement.
Allstate was aware that their employees were relying upon such misrepresentations
to their detriment. Upon information and belief, the same misleading and false
representations were made to Class members.
19. The promise and representation of permanent life insurance from
retirement to death at no additional cost to the retiree was substantial incentive and
consideration for the continued work of Plaintiff for Allstate up to the date of his
retirement. Employees relied upon these false representations by not purchasing
life insurance at a younger age and by relying upon the promise of such life
insurance in their financial planning.
20. On or about July 2, 2013, Allstate, through its Executive Vice
President and Chief Administrative Officer, wrote to Plaintiff, and upon
information and belief, the Class, terminating their life insurance benefits:
After careful consideration, beginning January 1, 2016, we have made the
decision to no longer pay the premium for your current retiree life insurance
benefit. Your current retiree life insurance benefit will remain in effect and
Allstate will continue to pay for your premium coverage until December 31,
2015. However, at that time your company-paid coverage will end. You
will be given the opportunity to continue coverage but at your own cost.
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 10 of 1921. On or about January 1, 2016, Plaintiff will be required to pay his own
retiree life insurance premiums which are at a substantially higher rate than the
premiums that Allstate pays for him today. Life insurance rates are based upon,
among other considerations, the age of the insured; the older the applicant, the
higher the rate. Plaintiff is over 80 years old today and life insurance rates are
significantly higher than they were when Allstate represented to him that his life
insurance benefits would be provided at no cost to him for life. Would Allstate not
have misrepresented to Plaintiff that his retiree life insurance benefits would be
paid for throughout retirement and until death, he would have obtained other life
insurance coverage while younger.
22. Plaintiff provided valuable services to Allstate in consideration for the
promise and representation of permanent life insurance at no additional cost to him
after his retirement.
23. Plaintiff will be irreparably harmed if the above described life
insurance coverage paid for by Allstate is terminated December 31, 2015.
24. Plaintiff has detrimentally relied upon the presence of such permanent
life insurance in making financial plans for himself and his family and Allstate was
aware of his reliance.
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 11 of 19COUNTS
25. Plaintiff adopts, re-asserts, and incorporates all of the foregoing
26. There exists between Plaintiff, on the one hand, and Allstate, on the
other hand, an actual justiciable controversy with respect to the matters set forth
here, as to which Plaintiff is entitled to have a declaration of rights and further
relief as set forth herein.
27. The Plaintiff is entitled a judgment declaring:
a. That Allstate violates ERISA by cancelling Plaintiff's Allstate
paid retiree life insurance benefits;
b. That Allstate, under ERISA, must continue to pay Plaintiff's
retiree life insurance benefits until his death, as has been promised and
represented to him by Allstate;
C. That Allstate, under ERISA, owes a fiduciary duty to Plaintiff
to communicate accurate information concerning his retiree life insurance
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 12 of 19d. That Allstate, under ERISA, breached its fiduciary duty owed
to Plaintiff by not communicating accurate information concerning his
retiree life insurance benefits;
f. That Plaintiff and the Class are entitled attorneys' fees against
Allstate under ERISA.
BREACH OF FIDUCIARY DUTY
28. Plaintiff adopts, re-asserts, and incorporates all of the foregoing
29. ERISA was enacted "to protect. . .the interests of participants in
employee benefit plans and their beneficiaries. . .by establishing standards of
conduct, responsibility, and obligations for fiduciaries of employee benefit plans
and providing for appropriate remedies. . and ready access to the Federal
Courts." Jones v. American General Life & Accident Ins. Co., 370 F.3 d 1065, 1071
(11th Cir. 2004) (quoting Varity Corp. v. Howe, 516 U.S. 489, 513 (1996) (quoting
ERISA § 2(b), 29 U.S.C. § 1001(b))).
30. ERISA requires plan fiduciaries to discharge their duties "solely in the
interests of the participants and beneficiaries" and "with the care, skill, prudence,
and diligence under the circumstances then prevailing that a prudent man acting in
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 13 of 19a like capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims." 29 U.S.C. § 1104(a).
31. ERISA defines "fiduciaries" to include persons identified as such in
the plan, ERISA § 402(a), 29 U.S.C. § 1102(a), and persons who exercise any
discretionary authority or responsibility concerning the management or
administration of the plan. 29 U.S.C. § 1002(21)(A).
The weight of authority recognizes that the term "fiduciary" is to be
liberally construed, a position that is consistent with the remedial
purposes of tRIISA. See In re Enron Corp. Sec., Derivative & ERISA
Litig., 284 F. Supp. 2d 511, 544 (S.D. Tex. 2003), quoting Ariz. State
Carpenters Pension Trust Fund v. Citibank, 125 F.3d 715, 720 (9th
Cir. 1997), citing John Hancock Mut. Life Ins. v. Harris Trust & Say.
Bank, 510 U.S. 86, 96, 114 S. Ct. 517, 126 L. Ed. 2d 524 (1993), and
quoting Mertens v. Hewitt Associates, 508 U.S. 248, 262, 113 S. Ct.
2063, 124 L.Ed.2d 161 (1993) ("Fiduciary status under ERISA is to
be construed liberally, consistent with ERJSA's policies and
objectives,' and is defined 'in functional terms of control and
authority over the plan,.. .thus expanding the universe Of persons
subject to fiduciary duties-and to damages-under § 409(a).")
Eslava v. Gulf Telephone Co., Inc., 418 F. Supp. 2d 1314, 1321-22 (S.D. Ala.
32. Employers that retain responsibility for administering their own
benefit plans are considered fiduciaries under ERISA. Varity Corp. v. Howe, 516
U.S. 489, 498 (1996); Hamilton v. Allen-Bradley Co., Inc., 244 F.3d 819, 824-26
(11th Cir. 2001).
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 14 of 1933. Employers act in a fiduciary capacity when communicating with
employees about plan benefits. Varily, 516 U.S. at 502-03; Hamilton, 244 F.3d at
827; In re Unisys Corp. Retiree Medical Benefit "ERiSA"Litig., 57 F.3d 1255,
1261, n. 10 (3d Cir. 1995); McMunn v. Pirreli Tire, LLC, 161 F. 5upp. 2d 97,129-
30 (D. Conn. 2001). In this action, the Plan expressly defines Allstate as the Plan
Administrator and expressly defines itself as a fiduciary.
34. Allstate acted in a fiduciary capacity when it made promises and
representations to Plaintiff and, upon information and belief, to the Class that their
life insurance benefits would remain until death at no cost to the retiree.
35. ERISA plan fiduciary's "responsibility when communicating with the
beneficiary encompasses more than merely a duty to refrain from intentionally
misleading a beneficiary. ERISA administrators have a duty not to misinform
employees through material misrepresentations and incomplete, inconsistent or
contradictory disclosures." Griggs v. E.I. Dupont De Nemours & Co., 237 F.3d
380 (4th Cir. 2001) (citation and internal quotations omitted).
36. A fiduciary's duty of disclosure entails not only a negative duty not to
misinform, but also an affirmative duty to inform when it knows that silence might
be harmful. Unisys, 57 F.3d at 1262; James v. Pirelli Armstrong Tire Corp., 305
F.3d 4391) 452 (6th Cir. 2002). In this action, Allstate was required to not only
provide accurate information concerning the Plan but also inform its employees
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 15 of 19that it may choose to cancel the no cost to retiree life insurance benefit. It failed to
37. Although the Plaintiff is not entitled to relief under ERISA §
501(a)(1)(B), ERISA § 502(a)(3) authorizes awards of "appropriate equitable
relief' to plan participants and beneficiaries who rely to their detriment on
inaccurate information from plan fiduciaries about plan benefits. Jones, 370 F. 3d
at 1071-74. Section 502(a)(3) is a "catchall" provision and was to "act as a safety
net, offering appropriate equitable relief for injuries caused by violations [of
ERISA] that § 502 does not elsewhere adequately remedy." Varily, 516 U.S. at
38. An injunction enforcing a plan fiduciary's representation to plan
participants about their benefits constitutes "appropriate equitable relief' under
ERISA. Unisys, 57 F.3d at 1269 (holding retirees' claims for "an injunction
ordering specific performance of the assurances Unisys made.. .are restitutionary in
nature and thus equitable."); Gregg v. Transportation Workers of Am. Int'l, No. 1
:99-CV-02659- PAG, Memorandum of Opinion and Order, pp. 6-10 (M.D . Tenn.
June 24, 2004) (holding that an order requiring the defendants to provide the
plaintiffs the coverage they had been promised constituted "appropriate equitable
relief") (citing Brown v. Aventis Pharmaceuticals, Inc., 341 F.3d 822 (8th Cir.
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 16 of 1939. ERISA § 502(a)(3) and § 502(a)(5) both expressly authorize the
imposition of injunctions or "other appropriate equitable relief to redress
violations of the Act. 29 U.S.C. § 1132(a)(3) and 1132(a)(5).
40. Allstate breached its fiduciary duty to provide Plaintiff with complete
and accurate information about his retiree life insurance benefits. Allstate also
remained silent when it knew that he was relying upon Allstate's
misrepresentations as to retiree's true and accurate life insurance benefits. Allstate
represented to Plaintiff and promised him that he would receive free, lifetime
group life coverage upon retirement when Allstate knew it was not true. Plaintiff
relied upon this misrepresentation to his detriment. Allstate should be enjoined
from benefitting from its misrepresentations and be held liable to Plaintiff and the
Class for its breach of fiduciary duties. Such representations were systematically
made to the Class as well.
41. ERISA § 502 (g)(1) authorizes awards of attorneys' fees and expenses
of litigation to the prevailing party in appropriate cases. 29 U.S.C. § 1 132(g)(1).
Allstate is required to pay attorneys' fees and expenses because of its culpability
and ability to satisfy such an award, Plaintiff's cause to resolve significant legal
questions through this action, and the deterrent effect such an award may have on
others in the same or similar situation. Wright v. Hanna Steel Corp., 270 F.3d
1336, 1344 (11th Cit. 2001).
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 17 of 19PRAYER FOR RELIEF
WHEREFORE, Plaintiff, on behalf of HIMSELF and all others similarly
situated, requests an order and judgment against Allstate which -
1. Certifies the Class and appoints Plaintiff and his counsel to represent
2. Grants declaratory judgment to the Plaintiff and Class.
3. Enjoins Allstate from doing the wrong alleged.
4. Awards a reasonable attorneys' fee to the Plaintiff and Class for the
common and public good obtained in this action.
5. Grants such other, further and different relief as the nature of the case
may require or as may be determined to be just, equitable, and proper by this
Case 2:13-cv-00685-MEF-CSC Document 1 Filed 09/23/13 Page 18 of 19BY:
W. Lewis Garrison, Jr.
Taylor C. Bartlett
ASB-23654A5 1 B
Christopher B. Hood
Attorneys for Plaintiff
Heninger Garrison Davis LLC
2224 First Avenue North
Birmingham, AL 35203
SERVE DEFENDANT by CERTIFIED U.S. Mail at these addresses:
Allstate Insurance Company
do CT Corporation System
2 North Jackson Street Suite 605
Montgomery, AL 36104