Plaintiff Linda Russo suffered a slip and fall on defendant's premises and brought the instant negligence action against defendant. The matter settled for the amount of $12,500.00, which is currently held in plaintiffs' attorney's escrow account. Respondent Meridian has asserted a lien against the proceeds as the administrator of the health care plan of plaintiff John Russo. The plan allegedly paid $19,913.44 for medical care and treatment of plaintiff Linda Russo on account of the injury which is the subject of the present action. Plaintiffs' attorney affirms that plaintiffs neither specifically sought nor received reimbursement of that portion of the medical expenses which were paid by collateral sources, pursuant to CPLR §4545, and that respondent's lien must therefore be extinguished.

Respondent asserts that the health plan is governed by The Employee Retirement Income Security Act of 1974(ERISA), that state law is preempted thereunder, and that CPLR §4545 therefore does not apply. It also asserts it has the right to commence a federal action for equitable relief under §502(a)(3) of ERISA. Respondent cites language from its plan which gives it subrogation rights to " . . . pursue the covered person's claims for covered medical expenses that become the responsibility of a third party or other insurer," and " . . . allows the Welfare Fund to pursue any claim which the covered person has against any third party or other insurer, whether or not the covered person chooses to pursue that claim." [*2]

Respondent's reliance on ERISA for the proposition that CPLR §4545 is preempted, and that respondent may impose liability on the plaintiffs herein for reimbursement of sums paid for health benefits is misplaced. The Supreme Court has held that in cases identical to the present one ERISA's enforcement remedies are equitable in nature and do not permit an insurer or its assignee "to impose personal liability on [the benefit recipient] for a contractual obligation to pay money." Great-West Life & Annuity Ins. Co. v. Knudson, 122 S.Ct. 708 at 715 (2002). Moreover, respondent's ability to recover benefits paid to plaintiff does not depend on ERISA, but on the subrogation language contained in its plan document. Primax v. Carey, 247 F.Supp. 2d 337 (S.D.NY 2002). In this case, whether respondent seeks enforcement of its lien, a right of subrogation, or reimbursement, it may only recover the expenses for which a third party is liable. Since plaintiffs' attorney affirms that no part of the recovery it received was for covered medical expenses, respondent is not entitled to reimbursement from plaintiffs. Respondent is not, however, without a remedy to pursue its claims against the tortfeasor in a separate action. Primax, id.

Plaintiffs' motion is granted to the extent that respondent may not seek reimbursement from plaintiffs' settlement. The court, however, does not "extinguish" respondent's lien or its right to subrogation sought in a proper action.



To: ADAMS LAW FIRM, P.C.

HENNESSY & WALKER, ESQS.

Dated: New City, New YorkEnt:_________________February 2, 2007A. J. S. C.