Court Affirms That Social Security Number Is A Material Term of Settlement

Recently, in the case In Re Asbestos Products Liability Litigation, 2013 U.S. Dist. LEXIS 76346 (E.D. Pa. May 8, 2013), a husband's estate and the wife negotiated a settlement with the defendants.  Thereafter, the defendants refused to release settlement funds until the spousal plaintiff (who had asserted only a loss of consortium claim) provided her Social Security number (SSN). The defendants claimed that this information was necessary to comply with Section 111 reporting requirements. Plaintiffs responded by filing a motion with the court to enforce the settlement agreement (which did not contemplate the procurement of an SSN). The plaintiffs argued that the SSN was not necessary because the spousal plaintiff's loss of consortium claim did not involve any damages related to medical care. 

The court first noted that Section 111's reporting rules clearly consider a loss of consortium claim potentially reportable. Thus, "it is permissible for a defendant to condition settlement on the production of a plaintiff’s SSN." Id. at *16-17. The court went on to say that, while state law may prevent the recovery of medical expenses from loss of consortium claims, that did not excuse the defendants from their Section 111 reporting requirements.

Because the defendants were obliged in this case to report under Section 111, and a required element to report under Section 111 is the SSN of a plaintiff, the court noted "the provision of this information is a material term of the settlement agreement that was never agreed upon by the parties." Id. at *17-18. Thus, the magistrate’s recommendation was that the settlement agreement was incomplete and unenforceable.

This decision is in line with a growing number of cases supporting a defendant’s ability to obtain a plaintiff’s SSN for purposes of reporting under Section 111.  Although Congress instructed CMS to make the provision of SSNs optional under Section 111, given the unlimited extensions that are available for CMS to actually accomplish that, the issue of SSNs will likely continue to arise in cases for the foreseeable future.