United States District Court for the Western District of Michigan; File No. l:95-CV-397;
Honorable Benjamin F. Gibson; Published
Official Michigan Reporter Citation; ________; Link to Opinion
In this published Opinion, Judge Gibson held that an employee benefit plan was not liable to pay plaintiffs medical expenses because the plan was a self-funded ERISA plan containing an exclusion of benefits for injuries caused by third parties.
Plaintiff was injured in an automobile accident on September 30, 1994. As an employee of Tyson's, he was a participant in Tyson's self-funded employee benefits plan maintained pursuant to the Employee Retirement Income Security Act (ERISA), 29 USC 1001, et seq.
Plaintiff was also insured by Farmers Insurance under a policy of Michigan no-fault automobile insurance. Plaintiff sought payment of his medical expenses from both Farmers and Tyson's. Both denied coverage, Tyson on the ground that its plan excluded coverage, and Farmers on the basis that Tyson is the primary insurer under the plan's coordination of benefits provision.
Judge Gibson upheld the plan administrator's decision to cease payments under the plan on the basis of an exclusion in the plan which stated:
"Medical care and disability benefits are not payable to or for a person covered under this plan when the injury or illness to the covered person occurs through the act or omission of another person..."
The court noted that ERISA preempts the application of Michigan's no-fault act. Judge Gibson further held that this contract unambiguously excludes benefits for an injury which occurs through the act or omission of third parties. Further, Judge Gibson held that for the exclusion to apply, it is not necessary for the third party to be adjudicated liable in a court of law. Therefore, Judge Gibson granted summary disposition in favor of Tyson's and against Farmers. Because there is no coverage to coordinate, Judge Gibson held that Farmers is obligated to pay plaintiff's no-fault benefits claims.