Saint-Gobain Containers, Inc., Division of French Giant Saint-Gobain Group, Sued for Denying Health Benefits

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Saint-Gobain Containers, Inc., an Indiana-based subsidiary of French industrial giant Saint-Gobain Group, was sued on May 6, 2005, in U.S. District Court for the Central District of California after denying health insurance benefits to the former wife of a retired employee, after she had heart surgery and a stroke. The retired employee was a 30-year employee of Saint-Gobain Containers' El Monte, California, facility. His former wife is a resident of Arcadia, California. In an unrelated action, in April 2005, Saint-Gobain Containers paid a $929,000 fine to the US Environmental Protection Agency to resolve alleged clean air violations at its Madera, California, facility.

Saint-Gobain Containers, Inc., an Indiana-based subsidiary of French industrial giant Saint-Gobain Group, was sued on May 6, 2005, in U.S. District Court for the Central District of California (CV-05-3414-RJK) after denying health insurance benefits to the former wife of a retired employee, after she had heart surgery and a stroke. The retired employee was a 30-year employee of Saint-Gobain Containers’ El Monte, California, facility. His former wife is a resident of Arcadia, California. In an unrelated action in April 2005, Saint-Gobain Containers paid a $929,000 fine to the US Environmental Protection Agency to resolve alleged clean air violations at its Madera, California, facility.

"My client's problems began in May 2004, when she her doctors discovered that one of her heart valves was deteriorating," said Cynthia Coulter Mulvihill, the attorney for the Plaintiff. "Late last year, her doctors made sure that the surgery was covered under her health insurance policy and set the surgery for the middle of January 2005."

"Saint-Gobain Containers' health insurance plan for its employees and retirees is 'self-insured,'" continued Ms. Mulvihill. "All medical benefits are actually paid by Saint-Gobain. Because my client has been submitting claims for medical benefits all along, Saint-Gobain knew my client was seriously ill long before her surgery." Ms. Mulvihill's client's ex-husband had been paying health insurance premiums as part of his divorce agreement. Saint-Gobain cancelled the insurance in December 2004 when the ex-husband fell behind on payments for his own insurance, although he was not behind on payments for his ex-wife's coverage. Although the surgery had been pre-authorized, Saint-Gobain did not tell Ms. Mulvihill's client that her insurance was cancelled. There are more than $200,000 in medical bills from the surgery and a stroke a few days later.

"My client just retired," said Ms. Mulvihill. "Now, she has more than $200,000 in unpaid medical bills and her credit is ruined. I begged Saint-Gobain Containers and Saint-Gobain Group to reconsider before I filed the lawsuit, but they wouldn't cover her medical bills."

Saint-Gobain Group's sales rose 8.3% in 2004, and its net income in 2004 was 1,083,000,000, a 10% increase over its 2003 net income. "The amount to cover this woman's medical bills is around 1/10,000th of Saint-Gobain Group's annual income," said Ms. Mulvihill. "To put it on a scale that those of us who don't earn billions can relate to, 1/10,000th of $200 is 2¢."

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Cynthia Coulter Mulvihill
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