Argument of Chief Justice Roberts
Mr. Roberts: I also have the opinion in No. 05-260, Sereboff versus Mid Atlantic Medical Services.
Marlene Sereboff’s employer sponsors a health-insurance plan administered by Mid Atlantic Medical Services.
Mrs. Sereboff and her husband are covered beneficiaries under this plan.
So when they were involved in a car accident and suffered injuries, the plan paid their medical expenses.
The Sereboffs later sued in state court other people who were involved in the accident and eventually received a substantial settlement.
Mid Atlantic, the insurance-plan administrator, then sued the Sereboffs in federal court, relying on a provision in the insurance plan that required beneficiaries to reimburse the plan for medical payments whenever the beneficiaries recovered for their injuries from a third party.
The Sereboffs opposed Mid Atlantic’s claim, but agreed to set aside in an investment account a portion of the state court’s settlement equal to the medical bills that Mid Atlantic had paid until the courts determined whether Mid Atlantic was entitled to recover.
Now, whether Mid Atlantic can get back what it paid the Sereboffs turns on the interpretation of the Employee Retirement and Income Security Act, or ERISA.
A provision of that law allows parties like Mid Atlantic to bring actions in federal court for, “equitable relief to enforce the terms of a plan”.
Now, that provision could be called the Legal Historians Relief Act, because it requires courts to harken back to the time of the so-called divided bench, when courts sat either as a court of equity or a court of law, depending on the nature of the suit.
We have to sort through the old cases and determine whether Mid Atlantic’s suit, had it been brought during the time of the divided bench, would have been brought in equity or at law, because ERISA allows suits only for equitable relief.
The Sereboffs argue that Mid Atlantic is just seeking damages for breach of contract, an action that would have been brought on the law side of the divided bench.
Like the District Court and the Court of Appeals, we disagree.
Mid Atlantic is claiming entitlement to a specific fund over which it has an equitable claim, that portion of the Sereboffs’ settlement recovery set aside owing to Mid Atlantic under the terms of the insurance plan.
Mid Atlantic has an equitable lien on that specific fund and, in the days of the divided bench, could have enforced that claim on the equity side of the court.
It may therefore proceed today under ERISA.
We affirm the judgment of the Court of Appeals for the 4th Circuit.
The decision is unanimous.
