In Goodman v. Motion Picture Indus., No. 20-55937, __F.App’x__, 2021 WL 3615415 (9th Cir. Aug. 16, 2021), the Ninth Circuit affirmed the district court’s judgment in favor of the Motion Picture Industry Health Plan in this dispute over the Plan’s termination of Plaintiff Cathy Goodman’s spousal benefits following her divorce from Lyle Robbins. The issue is whether the Plan abused its discretion in interpreting the terms of the Plan that provide that a divorced spouse “becomes ineligible for benefits at the end of the month in which the date of the final decree of dissolution of marriage or divorce is entered” to be the date that the Los Angeles County Superior Court family court entered the judgment of dissolution of marriage.

The court found that the plan administrator did not abuse its discretion when it interpreted the term “final decree of dissolution of marriage or divorce” to apply to the judgment of dissolution. The court rejected Plaintiff Goodman’s argument that the interpretation was a legal question tied to the interpretation of the California Family Code. The Ninth Circuit explained that the phrase did not incorporate or rely on any definitions from California state law; no statutory interpretation was necessary. Goodman also argued that the judgment was merely interlocutory because it did not resolve the divorce proceedings in their entirety. The Ninth Circuit found that the judgment unambiguously terminated the status of the marriage, which reasonably counts as a final decree of dissolution of marriage under the plain meaning of that phrase.

Lastly, the court found that because Plaintiff Robbins did not inform the Plan office of the final decree of divorce within 60 days of the state court judgment, the Plan was not obligated to send Goodman any additional information about her COBRA rights. Because there was no COBRA violation, there is no basis for statutory penalties.