Hillman v. Maretta

The Federal Employees’ Group Life Insurance Act of 1954 (FEGLIA) created a life-insurance system for federal employees. The system gave a policyholder the right to name a beneficiary, and FEGLIA required that the proceeds from a policy be paid to that beneficiary as first priority. FEGLIA explicitly preempted any state law relating to group life insurance that was inconsistent with FEGLIA. A Virginia law provided for situations in which a person’s marital status changed but the person did not update his or her life-insurance beneficiary to reflect that change. The law held former spouses liable to pay policy proceeds to whomever would be the rightful recipient under intestacy law, generally a widow or widower, thus disregarding the beneficiary designation. Warren Hillman and Judy Maretta were married. Warren obtained a life-insurance policy pursuant to FEGLIA and named Maretta as his beneficiary. The couple divorced, and Warren married Jacqueline Hillman. Warren did not update the beneficiary of his FEGLIA life-insurance policy before his death in 2008. Maretta, as the named beneficiary, received the proceeds from the policy. Jacqueline filed suit in Virginia state court, claiming that the Virginia law rendered Maretta liable for the proceeds. The state court granted Jacqueline summary judgment. The Virginia Supreme Court reversed. The United States Supreme Court granted certiorari.