Ninth Circuit Reverses Denial of Health Benefits, Finding UnitedHealthcare Abused Its Discretion by Stonewalling Claimant with Cookie-Cutter Denial Letters and Failing to Produce the Claim File for Over Three Years

In Campbell v. UnitedHealthcare Insurance Co., No. 24-5736, No. 25-758, 2026 WL 982848 (9th Cir. Apr. 13, 2026), a Ninth Circuit panel composed of Circuit Judges Tallman, VanDyke, and Tung reversed a Central District of California ruling that had affirmed UnitedHealthcare’s denial of health benefits for surgical assistant services, and further found that the district court abused its discretion in denying attorneys’ fees and declining to impose statutory penalties under 29 U.S.C. § 1132(c)(1). The decision is not designated for publication and is not precedent except as provided by Ninth Circuit Rule 36-3, but it presents a striking account of insurer stonewalling and a clear application of the Ninth Circuit’s meaningful dialogue doctrine.

Plaintiff Campbell underwent emergency surgery performed with the assistance of a physician from Emergency Surgical Assistants and submitted a claim for those services under her ERISA health insurance plan, jointly administered by UnitedHealthcare and her employer, Insperity (together “United”). United denied the claim on the stated ground that the services billed were “not documented as performed” — and then repeated that same rationale, word for word, throughout each successive level of the administrative process without ever engaging with Campbell’s arguments or specifying what additional documentation it required. Campbell made four separate written requests for the entire administrative record. United acknowledged receipt of each request and produced nothing — not a single document, not even the Plan itself — for more than three years. Campbell filed suit. The district court affirmed United’s denial, denied her motion for attorneys’ fees, and declined to impose statutory penalties. Campbell appealed all three rulings.

Standard of Review

The panel had no difficulty applying abuse-of-discretion review to United’s claim decision, as the Plan contained a discretionary-review clause that unambiguously conferred discretionary authority on the administrator. Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 963 (9th Cir. 2006).

Abuse of Discretion in Denying the Assistant Claim

Applying that deferential standard, the court nonetheless reversed. Plan administrators abuse their discretion when they fail to engage in a “meaningful dialogue” with beneficiaries or reject a claim without adequate explanation. Booton v. Lockheed Med. Benefit Plan, 110 F.3d 1461, 1463 (9th Cir. 1997). Where a claim is denied for insufficient documentation, the administrator must provide the claimant with a description of any additional material necessary to perfect the claim, in terms the claimant can understand. Saffon v. Wells Fargo & Co. Long Term Disability Plan, 522 F.3d 863, 870 (9th Cir. 2008) (citing 29 C.F.R. § 2560.503-1(g)).

United satisfied neither obligation. It issued what the court called “a stream of cookie-cutter denial letters” repeating the same vague, ambiguous — and in the court’s view misleading — rationale without once acknowledging Campbell’s arguments or describing what she would need to submit to cure the alleged documentation deficiency. United’s shifting and contradictory explanations of its own rationale during the course of litigation only confirmed the inadequacy of its communications during the claims process. Compounding the problem, United’s own file contained documentation confirming that Campbell’s surgery had been performed with surgical assistant support, and United had acknowledged receiving and reviewing supplemental documentation Campbell submitted on appeal. Despite all of this, it never produced any underlying documents.

Attorneys’ Fees

The court also reversed the district court’s denial of attorneys’ fees. Under Ninth Circuit precedent, fees should be denied to successful ERISA employee plaintiffs only when “special circumstances would render such an award unjust.” Smith v. CMTA-IAM Pension Tr., 746 F.2d 587, 589 (9th Cir. 1984). The district court had seized on a minor formatting irregularity: narrative descriptions in Campbell’s retabulated billing records — reformatted at the district court’s own request — spanned two lines rather than one. The panel found that discrepancy wholly insufficient to discredit the billing records as a whole, particularly where a side-by-side comparison with the original unredacted time sheets revealed no substantive alterations. That conclusion, the court held, was without support in the record.

Statutory Penalties

Finally, the panel vacated the district court’s refusal to impose penalties under § 1132(c)(1), which authorizes per-day penalties against any plan administrator who fails or refuses to comply with a written request for plan documents it is required by ERISA to furnish. United was not tardy — it failed entirely, for over three years, to produce any portion of the administrative record, including the Plan document, in response to four documented requests. The court found that Campbell was plainly prejudiced: without access to the Plan, she had no reference point against which to evaluate the validity of United’s denial rationale and no meaningful ability to perfect or prevail on her claim. See Lee v. ING Groep, N.V., 829 F.3d 1158, 1160 (9th Cir. 2016). The district court’s contrary conclusions were unsupported by the record, and the panel remanded with instructions to impose penalties.

The Ninth Circuit reversed the benefits denial, vacated the attorneys’ fees and statutory penalties rulings, and remanded with instructions to award fees absent specific and logical indicia of unreliability and to impose penalties consistent with the disposition. Costs were taxed against the appellees.