FOR IMMEDIATE RELEASE
Los Angeles, California — December 16, 2025 — A federal court in the Central District of California has rejected Unum Group’s attempt to impose ERISA preemption on an individually owned disability insurance policy, holding that the policy is governed by California law. The Court struck Unum’s ERISA-based affirmative defenses and ruled that the insured’s state-law claims may proceed in full.
The decision, issued in Koo v. Unum Group et al., represents a significant reaffirmation of California’s longstanding bad-faith insurance precedent. The plaintiff was represented by David Bryant, Of Counsel to Meyers & Flowers, whose practice focuses on private disability insurance litigation.
In Koo v. Unum Group et al., the Court found that Unum failed to establish the existence of any ERISA-governed employee benefit plan. The policy was individually underwritten, paid entirely by the insured with post-tax dollars, voluntary, and expressly disclaimed by the employer as non-ERISA. The Court further held that the policy falls squarely within the Department of Labor’s safe-harbor regulation and is regulated under California insurance law.
The ruling carries substantial consequences. By rejecting ERISA preemption, the Court confirmed that Unum is subject to California’s full insurer-accountability framework, including tort liability for bad faith, extra-contractual damages, and potential punitive damages were supported by evidence of oppressive, fraudulent, or malicious claims conduct.
The decision fits within a broader historical pattern. In Hangarter v. Provident Life & Accident Insurance Co., the Ninth Circuit affirmed a landmark California bad-faith verdict against an Unum-affiliated insurer, including punitive damages, based on evidence of biased claims handling and insurer misconduct. That case remains a leading authority on California insurer bad faith.
In Koo, the Court relied heavily on Unum’s own enrollment materials and internal records, which repeatedly characterized the coverage as an individually owned, state-regulated policy and acknowledged that ERISA applicability was not Unum’s determination to make. The Court rejected Unum’s litigation-driven attempt to “ERISA-fy” the policy after years of administering it as a California contract.
“California courts have made clear—time and again—that insurers cannot manipulate legal frameworks to evade accountability,” said David Bryant, Of Counsel to Meyers & Flowers. “When Unum sells and administers individual disability policies under state law, it remains subject to California bad-faith protections.”
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About Meyers & Flowers:
Led by Illinois Top 100 Super Lawyer and former President of the Illinois Trial Lawyers Association, Peter J. Flowers, the Meyers & Flowers’ team of experienced trial attorneys routinely take on large challenges and succeed. For more than two decades, the firm has represented clients both locally in Chicago and nationally in a full spectrum of cases involving catastrophic personal injuries, medical malpractice, defective products, and wrongful death.
About Bryant Legal Group
Bryant Legal Group is a nationally recognized plaintiffs’ firm focused exclusively on individual disability insurance litigation and complex insurance coverage disputes. The firm represents physicians, executives, and professionals nationwide against major disability insurers, with a particular emphasis on exposing improper ERISA defenses, bad-faith claims handling, and systemic insurer misconduct. To learn more about Bryant Legal Group, please visit www.bryantlg.com.