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Second Circuit Holds That Assignee of Patient's Assignee Lacks Standing to Sue Under ERISA


HLD, v. 29, n. 11 (November 2001)

Second Circuit Holds That Assignee of Patient's Assignee Lacks Standing to Sue Under ERISA

Patient "M.M." received medical treatment from Humanistic Mental Health Foundation ("Humanistic"), which charged $25,600 for its services. M.M. assigned his health benefits from General Electric Life Disability and Medical Plan ("Plan") to Humanistic. The Plan denied payment of $5,637 of Humanistic's charges and rejected Humanistic's resulting appeal. Humanistic then assigned M.M.'s claims to Stephen Simon, a non-lawyer, who sought to recover the unpaid amount. After failing to obtain payment, Simon sued the Plan and others (collectively "defendants") in federal district court, asserting claims of denial of benefits under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. � 1001 et seq., and of breach of fiduciary duty under ERISA. Defendants moved for dismissal, arguing that Simon lacked standing under ERISA. The court granted defendants' motion and dismissed Simon's complaint. Simon appealed.

The Second Circuit affirmed, agreeing that Simon, as assignee of an assignee, was not a participant or beneficiary of an ERISA plan and thus had no standing for his lawsuit. Simon had conceded that he was neither a participant nor beneficiary of the Plan, but had claimed standing "as an assignee of a beneficiary." In rejecting Simon's argument, the appeals court noted that it had previously joined other circuits in "carving out a narrow exception to the ERISA standing requirements" and emphasized that this exception "grants standing only to healthcare providers to whom a beneficiary has assigned his claim in exchange for health care." Because Simon was not a healthcare provider assignee, the appeals court concluded that he did not have standing to bring his lawsuit.

Simon v. General Elec. Co., No. 00-9437, 2001 WL 1001163 (2d Cir. Aug. 29, 2001) (5 pages).

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