A federal judge in Texas found that the NFL player retirement plan violated the Employee Retirement Income Security Act (ERISA) when it denied Michael Cloud, a former running back and Super Bowl Champion, placement in a higher benefits classification. The case is Cloud v. The Bert Bell/Pete Rozelle NFL Player Retirement Plan, case number 3:20-cv-01277, U.S. District Court for the Northern District of Texas.
The Texas court issued a scathing oral ruling in which it found that the plan had a history of selectively failing to conduct full and fair reviews of former players’ applications for disability benefits. The judge pointed to Cloud’s cumulative mental disorders stemming from repeated concussions, qualifying him for inclusion in the plan’s highest benefit tier.
The judge also issued a rebuke to the law firm representing the plan. She noted that the law firm participated in drafting the retirement plan and routinely advises the plan’s claims committee and board by drafting case summaries and writing decision letters.
Among the allegations that led to the court’s decision were that the plan voted on applications, in groups of about 50, and failed to discuss individual cases. At trial, Cloud also presented evidence that the plan did not fully review his reclassification application, which consisted of over 1,000 documents. Instead, a case manager paralegal wrote up a case summary and presented it to the plan’s board members, along with a denial letter, before the board had even voted on the claim. The plan also revealed that only 30 former football players receive the highest tier of benefits available under the plan, all of whom suffered injuries that fully or partially paralyzed them.
Cloud began receiving disability benefits from the plan in 2010 after a forced retirement due to multiple concussions that led to mental disorders in 2005. Cloud then filed for reclassification of his benefits in 2016 after a 2014 Social Security Administration determination that he was totally and permanently disabled. The plan denied his application for reclassification, and Cloud appealed, but the plan denied the appeal in September 2016. Cloud then sued the plan over the denial in 2020.
HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.
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