Opinion
Civ. No. 99-2109, SECTION: G (5).
March 2, 2000.
MEMORANDUM AND ORDER
Background
Plaintiff, Ellen B. Woody, commenced this action against Defendant, Fortis Benefits Insurance Company ("Fortis") in the Civil District Court of the Parish of Orleans, seeking a review of Fortis' denial of her claim for long term disability benefits under her employer's employee welfare benefit plan. Fortis timely removed the action, alleging subject matter jurisdiction based on diversity and § 502(a)(1)(B) of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132(a)(1)(B)
This case arises out of back injuries Plaintiff allegedly sustained on or about August 4, 1997, while changing the sheets on her bed. Due to her back pain, Plaintiff sought medical treatment from several physicians and eventually left her employment as an attorney-librarian at the law firm of Christovich Kearney, L.L.P. ("Christovich") in November of 1997. Plaintiff claims that she cannot perform the requirements of her job as an attorney-librarian because she cannot sit for extended periods of time.
Christovich maintains an employee welfare benefit plan ("the plan") with long term disability benefits. The plan is funded through a Fortis insurance policy. Under the plan, participants shall be paid "a monthly benefit designed to partly replace income lost during periods of disability that result from injury, sickness or pregnancy." The plan provides that
The plan provide definitions for italicized terms.
Disability or disabled means that in a particular month, [the claimant satisfies] either the Occupation Test or the Earnings Test, as described below. [The claimant] may satisfy both the Occupation Test and Earnings Test, but [the claimant] need only satisfy one Test to be considered disabled.
Plaintiff challenges only Fortis' determination that Plaintiff fails to satisfy the Occupation Test requirements.
The plan's Occupation Test for a claimant in Plaintiff's position states that
during a period of disability (including the qualifying period), an injury, sickness, or pregnancy requires that [the claimant] be under the regular care and attendance of a doctor, and prevents [the claimant] from performing at least one of the material duties of [the claimant's] specialty, if his employment is based upon the performance of his specialty.
The plan also provides that the term "material duties" means "the sets of tasks or skills required generally by employers from those engaged in a particular occupation." In addition to defining the meaning of "disability" under the policy, the plan provides that Fortis is the claims administrator.
Pursuant to the terms of the plan, Plaintiff submitted a claim for long term disability benefits to Fortis on February 17, 1998. Plaintiff claimed that she could not perform her duties as an attorney-librarian because of her back injury. Plaintiff provided that she had consulted with Dr. Hugh Fleming, Dr. Terry Habig, Dr. Jay Kayser and Dr. Edna Doyle concerning her injury. Although Plaintiff saw several doctors concerning her injury, Dr. Fleming, a neurologist, has been treating Plaintiff since November 1997. He initially diagnosed Plaintiff with a soft tissue injury and noted "decreased range of motion secondary to guarding from pain with some lumbar muscle spasm noted."
Dr. Fleming referred Plaintiff to Dr. Doyle, a rehabilitation specialist. Dr. Doyle saw Plaintiff in January and March of 1998. During the first visit, Dr. Doyle detected multiple trigger points along the right longissimus thoracis and recommended physical therapy. After Plaintiff underwent some physical therapy, Dr. Doyle reported that Plaintiff was "doing well in physical therapy" and had some "tenderness over the longissimus thoracis in the lower part." Dr. Doyle also noted that Plaintiff indicated that her desk work was an irritating factor.
During its investigation of Plaintiff's claim, Fortis obtained medical information from Plaintiff's doctors and received descriptions of Plaintiff's job requirements and physical capabilities. Christovich provided that Plaintiff's job as an attorney-librarian required Plaintiff sit for six hours, walk for one hour and stand for one hour in an eight hour work day and indicated that Plaintiff operated a computer most of the day and occasionally had to carry and lift books, weighing up to three pounds. At Fortis' request, Dr. Doyle, completed a Physical Capabilities Evaluation form that indicated that Plaintiff is capable of sitting for six hours with brief stretching breaks every hour, walking for one hour and standing for one hour in an eight hour work day and is able to carry and lift some weight below shoulder level occasionally.
Before providing the Physical capabilities Evaluation form to Fortis, Dr. Doyle spoke with Plaintiff.
On May 13, 1998, Fortis wrote a letter to Plaintiff, informing her of its decision to deny her long term disability claim. Fortis explained:
We have just completed our review of your claim based on the medical information submitted to date. Based on our review, your file does not provide medical evidence of a limiting condition that would prevent you from performing at least one material duty of an Attorney/Librarian.
. . .
Dr. Doyle has given no restrictions or limitations that would preclude you from performing the duties of your occupation as an Attorney/Librarian. In comparing your restrictions/limitations with the job description as provided by your employer it is determined that you are capable of performing your speciality. There are no differences listed between your capabilities, as provided by Dr. Doyle, and your actual job duties that would preclude you from performing at least one material duty of your speciality.
. . . Should you choose to appeal this decision, please provide further medical documentation of the severity of your condition during the period in question which specifies what duties of your specialty you are unable to perform.
Plaintiff appealed Fortis' denial of her claim and submitted additional medical information to Fortis in support of her claim. That information included Dr. Fleming's September 1998 notes, which indicate that Plaintiff's pain had increased. He noted that Plaintiff "continues to have severe radicular pain in the intercostal nerves" and indicated that he "told [Plaintiff] that she is disabled at this time, because she is unable to sit more than an hour or two at a time, cannot do any type of bending or lifting without severe pain, or any other type of activity."
Fortis referred the appeal to a registered nurse, Jan Jenkinson, for preliminary review and to an independent medical reviewer, Dr. Craig S. Heligman before sending Plaintiff's appeal to the Fortis appeal committee. Ms. Jenkinson and Dr. Heligman determined independently that the available medical information did not support Plaintiff's claim that she could not perform her job. Based on the independent medical review of Dr. Heligman and on an evaluation of Plaintiff's claim file, the appeal committee upheld the denial of Plaintiff's claim and notified Plaintiff of its decision.
During the evaluation of Plaintiff's claim, Fortis compiled a file of all information submitted to and gathered by Fortis. According to Fortis, that 278 page file contains all information upon which its decision to deny Plaintiff's claim rests and constitutes the administrative record.
Motions
Fortis moves this Court to exclude, for any purpose, all evidence not contained in its 278 page work file, including the testimony of Plaintiff, Fortis' claims handler Deb McGlaughlin and Dr. Fleming. In addition, Fortis moves for summary judgment, claiming that it did not abuse its discretion in denying Plaintiff's claim because its denial is supported by substantial evidence and it is entitled to attorney's fees and costs. Plaintiff opposes Fortis' motions.
Discussion
I. Standard of Review
Although ERISA provides for federal review of claim determinations under an employee welfare benefit plan, ERISA does not guide the federal courts as to the standard of review. Several Supreme Court and Fifth Circuit decisions, however, instruct reviewing courts that the appropriate standard of review depends on several factors, including the type of determination under review, the discretion granted to the administrator by the employee welfare benefit plan and the degree to which the administrator appears to be self-interested.
The parties agree that ERISA covers Plaintiff's claim because the Christovich plan is an employee welfare benefit plan and Plaintiff is a participant of the plan, seeking review of a denial of benefits. See 29 U.S.C. § 1132(a)(1)(B).
In evaluating a claim for benefits under an employee welfare benefit plan, administrators entertain two types of decisions: plan term interpretations and factual determinations. Courts review plan term interpretations under a de novo standard of review unless the plan involved gives the administrator "discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Where a plan gives the administrator discretionary authority, courts review the administrator's interpretation of plan terms for an abuse of discretion. Reviewing courts, in determining the appropriate standard of review, will not infer discretionary authority; the plan must expressly confer discretionary authority on the administrator.
Firestone Tire Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989).
See id.
See Wildbur v. ARCO Chemical Co., 974 F.2d 631, 636 (5th Cir. 1992) (citing Cathey v. Dow Chemical Co. Medical Care Program, 907 F.2d 554, 558 (5th Cir. 1990).
Courts review all factual determinations by plan administrators under an abuse of discretion standard. As the Fifth Circuit explained, "federal courts owe due deference to an administrator's factual conclusions that reflect reasonable and impartial judgment."
See Pierre v. Connecticut General Life Insurance Company, 932 F.2d 1552, 1562 (5th Cir. 1991).
Id.
Regardless of the type of decision under review, the amount of deference given to an administrator's decision by a reviewing court under an abuse of discretion standard varies when applied to a self-interested claims administrator. The Fifth Circuit en banc explains:
The existence of a conflict is a factor to be considered in determining whether the administrator abused its discretion in denying a claim. The greater the evidence of conflict on the part of the administrator, the less deferential our abuse of discretion standard will be."
Vega v. National Life Ins. Services, Inc., 188 F.3d 287, 297-98 (5th Cir. 1999).
In such cases, federal courts are "less likely to make forgiving inferences when confronted with a record that arguably does not support the administrator's decision . . . [and] expect the administrator's decision to be based on evidence, even if disputable, that clearly supports the basis for its denial."
Id. at 299.
In adopting this "sliding scale" abuse of discretion standard, the Fifth Circuit specifically refused to impose upon claim administrators a duty to investigate claims reasonably because by imposing such a duty, the Court would have adopted a presumptively void standard of review. The Court explained that
See id. at 298.
In effect, we would shift the burden to the administrator to prove that it reasonably investigated the claim. A rule that permitted such a result would be at odds with the Supreme Court's instruction in Bruch to review such determinations under an abuse of discretion standard — a standard that demands some deference be given to the administrator's decision. Such a rule would also violate basic principles of judicial economy. There is no justifiable basis for placing the burden solely on the administrator to generate evidence relevant to deciding the claim, which may or may not be available to it, or which may be more readily available to the claimant. If the claimant has relevant information in his control, it is not only inappropriate but inefficient to require the administrator to obtain that information in the absence of the claimant's active cooperation.
Id.
Under the abuse of discretion standard for plan term interpretation and factual determinations, reviewing courts "focus on whether the record adequately supports the administrator's decision." As the en banc Fifth Circuit explains in Vega, "[t]he advantage to focusing on the adequacy of the record, however, is that it (1) prohibits the district court from engaging in additional fact finding and (2) encourages both parties properly to assemble the evidence that best supports their case at the administrator's level."
Id.
Id.
Nevertheless, in evaluating plan term interpretations under an abuse of discretion standard of review, reviewing courts may rely on "some evidence other than that contained in the administrative record." For example, the Fifth Circuit suggests that "[d]etermining whether the administrator has given a uniform construction to a plan may require a court to evaluate evidence of benefit determinations other than the one under scrutiny."
Wildbur, 974 F.2d at 638.
Id.
Similarly, reviewing courts may review evidence that was not presented to the administrator when evaluating questions of self-interest and good faith under an abuse of discretion standard. Accordingly, a reviewing court may consider additional evidence other than that contained in the administrative record when reviewing plan term interpretations de novo. In contrast, when assessing factual determinations, reviewing courts are "constrained to the evidence before the plan administrator."
See id.
Vega, 188 F.3d at 299 (citing Meditrust Financial Services Corp. v. Sterling Chemicals, Inc., 168 F.3d 211, 215 (5th Cir. 1999); Schadler v. Anthem Life Insurance Co., 146 F.3d 388, 394-395 (5th Cir. 1998); Thibodeaux v. Continental Casualty Insurance, 138 F.3d 593, 595 (5th Cir. 1998); Barhan v. Ry-Ron, Inc., 121 F.3d 198 (5th Cir. 1997)) (further citations omitted).
Here, Fortis' motion in limine to exclude evidence not contained in the administrative record must be denied in part and granted in part. With respect to a review of Fortis' interpretations of the terms of the Christovich plan, Fortis' motion in limine is denied. Because the Christovich plan fails to grant Fortis, as the claim administrator, discretionary authority to construe the terms of the plan, a de novo review of Fortis' interpretation of the plan terms is appropriate pursuant to Supreme Court and Fifth Circuit case law. Accordingly, evidence outside the 278 page file compiled by Fortis during its evaluation of Plaintiff's claim may be appropriate and is not prohibited.
With respect to a review of Fortis' factual determinations, Fortis' motion in limine is granted in part. All factual determinations by a claim administrator are subject to an abuse of discretion standard. Where the administrator may be self-interested, as is the case here because Fortis underwrites the Christovich plan, evidence of self-interest is relevant to determining the appropriate amount of deference under the Fifth Circuit's sliding scale approach.
In contrast, evidence outside the administrative record relating to Fortis' factual determinations of the merits of Plaintiff's claim should be excluded. For example, additional medical evidence relative to Plaintiff's back injury and her physical capabilities are distinctly factual determinations, and additional evidence relevant to those issues is not permitted.
II. Summary Judgment
In addition to its motion in limine, Fortis moves for summary judgment, arguing that it did not abuse its discretion in making the factual determination that the medical evidence submitted by or on behalf of Plaintiff does not support Plaintiff's claim that she is prevented from performing at least one material duty of her job as an attorney-librarian.
F.R.Civ.P. 56(c) provides that summary judgment should be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." To meet this standard, the moving party must present more than "mere allegations or affidavits setting forth ultimate or conclusory facts and conclusions of law." The inferences drawn from the underlying facts, however, must be viewed in a light most favorable to the nonmoving party. The substantive law determines the materiality of the facts, and only facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Thus, only genuine disputes over "material facts" can prevent a grant of summary judgment. A "genuine issue" exists only if there is "sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Finally, if the moving party meets its initial burden of production, the adverse party must go beyond the pleadings and set forth specific facts that show the existence of a genuine issue of material fact. If the adverse party fails to do so, then summary judgment, if appropriate, shall be entered against the adverse party.
Bynum v. FMC Corp., 770 F.2d 556, 576 (5th Cir. 1995).
See Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 588 (1986).
See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
See id.
Id. at 249.
See FRCP 56(e).
See id.
Here, Fortis meets its initial burden of showing that no genuine issue of material fact exists and that it is entitled to judgment as a matter of law. Fortis clearly demonstrates that it did not abuse its discretion in making its factual determination that Plaintiff is capable of performing at least one material duty of her job as an attorney-librarian. Even under the least deferential abuse of discretion standard, Fortis did not abuse its discretion in reaching that factual determination because substantial evidence exists in Fortis' 278 page claim file. Plaintiff's physical capabilities, as described by Dr. Doyle, indicate clearly that Plaintiff is not prevented from performing any of her material duties. Furthermore, Dr. Fleming's September 1998 office notes, which Plaintiff relies on heavily to support her disability claim, do not support a finding that Plaintiff's physical capabilities prevent her from performing any material function of her job. Moreover, two independent medical reviewers determined that the medical information provided by and on behalf of Plaintiff does not support Plaintiff's claim that her back injury prevents her from performing any material duty of her job. Therefore, even if Plaintiff had an opportunity to present additional evidence relative to Fortis' self-interest and its interpretation of plan terms, my finding that Plaintiff's claim file contains substantial evidence in support of Fortis' factual determination would not be disturbed.
III. Attorney's Fees and Costs
Finally, Fortis seeks for the Court to award it attorney's fees and costs, pursuant to 29 U.S.C. § 1132(g)(1). Under that provision, a reviewing court may "in its discretion . . . allow a reasonable attorney's fee and costs of action to either party." In exercising its discretion, a reviewing court considers the following factors:
(1) the degree of the opposing parties' culpability or bad faith; (2) the ability of the opposing parties to satisfy an award of attorney's fees; (3) whether an award of attorney's fees would deter other persons acting under similar circumstances; (4) whether the parties requesting attorney's fees sought to benefit all participants and beneficiaries of an ERISA plan or to resolve a significant legal question regarding ERISA itself; and (5) the relative merits of the parties' positions.
Iron Workers Local #272 v. Bowen, 624 F.2d 1255, 1266 (5th Cir. 1980).
Here, I decline to exercise my discretion to award Fortis reasonable attorney's fees and costs. There is no evidence that Plaintiff acted in bad faith in seeking a review of Fortis' claim determination. Fortis has not presented any evidence concerning Plaintiff's ability to pay such an award. Furthermore, there is no evidence that granting such an award would deter others similarly situated. In addition, Fortis' defense of this action does not seek to benefit all participants or beneficiaries of the Christovich plan or resolve a significant legal question regarding ERISA. Finally, although Fortis' denial of benefits is clearly supported by substantial evidence in it's claim file, Plaintiff's claim does not appear to be a frivolous one. Thus, Fortis is not entitled to an award of attorney's fees and costs.
Accordingly,
IT IS ORDERED that Fortis' motion to exclude evidence outside the administrative record is GRANTED IN PART, with respect to factual determinations of the merits of Plaintiff's claim and DENIED IN PART with respect to evidence relevant to Fortis' interpretations of plan terms and self-interest. It is further ordered that Fortis' motion for summary judgment is GRANTED. Finally, Fortis' claim for attorney's fees and costs is DENIED.
New Orleans, Louisiana, this 2nd day of March, 2000.