MetLife Denied Early Appeal in Checkbook Challenge

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Jacklyn Wille

Metropolitan Life Insurance Co. can’t appeal a decision holding that its practice of paying life insurance benefits through a checkbook-like system violates federal law ( Owens v. Metro. Life Ins. Co. , 2017 BL 7893, N.D. Ga., No. 2:14-cv-00074-RWS, 1/11/17 ).

A federal judge on Jan. 11 refused to reconsider a 2016 ruling that the Employee Retirement Income Security Act bars MetLife from paying life insurance benefits through retained asset accounts, which operate like checkbooks that earn limited interest and can be used to draw funds. The judge also denied MetLife’s request for an immediate appeal of this decision, instead allowing the case to proceed toward a ruling on class action status.

Retained asset accounts are a common method of paying life insurance benefits that have been challenged under ERISA because they allow insurers to continue earning interest off policy proceeds that have been distributed to beneficiaries. The ruling against MetLife turned largely on the specific language of the insurer’s policy, which the judge said differed significantly from policy language at issue in recent cases favoring UNUM Life Insurance Co. of America, Sun Life Assurance Co. of Canada and Lincoln National Life Insurance Co.

MetLife argued that the differing judicial opinions on retained asset accounts created a circuit split that would be aided by immediate review of the judge’s ruling. The judge disagreed, saying that the different opinions were explained by different policy language, and not a disagreement among the courts.

Judge Richard W. Story of the U.S. District Court for the Northern District of Georgia wrote the decision.

The MetLife beneficiaries are represented by Barrett Wylie LLC, Bell & Brigham, John Oxendine PC, Lober Dobson & Desai LLC and Law Office of Todd L. Lord. MetLife is represented by Sutherland Asbill & Brennan LLP.

To contact the reporter on this story: Jacklyn Wille in Washington at

To contact the editor responsible for this story: Jo-el J. Meyer at

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