ERISA and Child Injury Settlements

ERISA liens in child injury cases are vulnerable to being negated through settlement apportionment during the local court approval process. Federal courts have recognized the authority of state probate courts to protect child injury settlement funds, even when healthcare providers argued lien preemption based on strong subrogation language within the subject ERISA plan.  See In The Matter of the Guardianship of O. D. v. The Ashley Healthcare Plan, No. 3:2011cv00146 – Document 17 (N.D. Miss. 2013)Bauhaus USA, Inc. v. Copeland, 2001 WL 1524373 (N.D. Miss. Mar. 9, 2001).

Healthcare providers seeking to enforce liens in federal court have even been forced to pay attorney’s fees after having their actions dismissed. In 2015, the Mississippi Supreme Court allowed attorney’s fees to be levied against a healthcare provider for their frivolous federal action to enforce an ERISA lien that had been negated by the local probate court. In the Matter of the GUARDIANSHIP of O.D., A Minor: Ashley Healthcare Plan v. Michael DILLARD and Kimberly Dillard,  177 So.3d 175 (2015).  While no such precedent has been created for Florida, the thought of a healthcare provider seeking enforcement of an ERISA lien in federal court, only to wind up with an bill for the defendant’s attorney’s fees will give pause to future lien holders in the same scenario.

Plaintiff’s and their attorneys should be encouraged by the limitation of ERISA preemption by federal courts. State probate courts wield the power to diminish or erase ERISA liens in child injury cases. In the court approval phase of a child injury case, Florida Probate Law Group can seek an order apportioning the minor’s settlement to the maximum advantage of the minor. Our firm works statewide, often with no fees up front. Should you have a question about a specific case call 352-354-2654 or email cdavid@circuit8law.com.