Summary
holding that factual determination that plaintiff was no longer totally disabled under the plan was supported by substantial evidence, including plaintiff's own doctor, an independent doctor (paid by plan), and a vocational rehabilitation exam (paid by plan)
Summary of this case from Rigby v. Bayer CorporationOpinion
CIVIL ACTION NO. 94-1185, SECTION "A".
July 11, 1994
ORDER AND REASONS
This case is once again before the Court on defendant's Motion for Summary Judgment. The matter was set for oral hearing on July 6, 1994 but was submitted on the briefs. The defendant seeks dismissal of plaintiff's claims alleging wrongful denial of benefits under the Group Long Term Disability Plan for Employees of Discovery Chemicals, Inc. (hereafter "the Plan"). Plaintiff's employer, Discovery Chemicals, Inc., contracted with defendant Provident Life Accident Insurance Company ("Provident") to provide disability benefits coverage to eligible employees.
The bases of defendant's Motion to Dismiss and/or for Summary Judgment are that: (1) plaintiff's state law claims are preempted; and (2) the Plan Administrator's factual determination that plaintiff was no longer totally disabled within the meaning of the pertinent unambiguous Plan provisions does not amount to an abuse of discretion since its factual determination was supported by substantial evidence and thus, it must be upheld. Plaintiff filed formal opposition arguing, inter alia, that the instant case involves Plan interpretation rather than simply a factual determination and thus, the standard of review is de novo rather than the abuse of discretion standard urged by the defendant. It is undisputed that Discovery Chemical's Plan is an ERISA welfare benefit plan and that plaintiff's state law claims are preempted.
Section 514(a) of ERISA provides that it "shall supersede any and all state laws insofar as they now or hereafter relate to any employee benefit plan." 29 U.S.C. § 1144(a).
Undisputed Factual Background
Beginning in 1985, the plaintiff was employed as a secretary with Discovery Chemicals. Discovery Chemicals had contracted with defendant Provident to provide disability benefits coverage to eligible employees. In October of 1989, plaintiff fell and injured here coccyx while at home. Plaintiff's last day of work was January 11, 1990. On February 14, 1990, a percutaneous discectomy was performed on the plaintiff.
Statement of Uncontested Facts, No. 1, which plaintiff admitted.
Statement of Uncontested Facts, No. 2, which plaintiff admitted.
Statement of Uncontested Fact, No. 3, which plaintiff admitted.
At the time of plaintiff's injury in October, 1989, and at the time of her last employment with Discovery Chemicals on January 11, 1990, plaintiff was a covered participant of the Plan. The Plan provides for payment of benefits to eligible employees who meet the Plan definition of disability, beginning after a designated elimination period and ending on the date Total Disability ceases. The Plan unambiguously defines disability as follows:
Statement of Material Fact, No. 4, which plaintiff admitted.
. . . [Y]ou will be termed Totally Disabled due to Injury or Illness only if:
(1) you are not able to do each of the material duties of your job during the first the 3 years that benefits are paid and you do not work at any other occupation; and
(2) after benefits have been paid for 3 years, you are not able to do each of the material duties of any job for gain or profit for which you are reasonably fitted by education, training or experience.
Statement of Uncontested Facts, No. 7, which the plaintiff admitted.
Plaintiff filed her initial claim for disability benefits on July 5, 1990. After reviewing medical reports and having informed plaintiff that her benefit payments might end after three years if she was able to perform any gainful employment defined in the policy, by letter dated August 21, 1990, Provident informed plaintiff that her claim for disability benefits was approved. The letter included the Plan definition of totally disabled cited above. Provident paid disability benefits to the plaintiff through October 31, 1993.
Statement of Uncontested Facts, No. 8, which plaintiff admitted.
Statement of Uncontested Facts, No. 11, which the plaintiff admitted.
Statement of Uncontested Facts, No. 11, which the plaintiff admitted.
Pursuant to its right under the Plan, in October of 1990, Provident informed the plaintiff that it had retained an independent company to schedule an independent medical examination. Such medical examination was conducted by Dr. Dexter Gary, who concluded that the plaintiff was tentatively disabled, but recommended further diagnostic testing.
Statement of Uncontested Facts, Nos. 12 and 13, which the plaintiff admitted.
Plaintiff also initially filed a claim for benefits with the Social Security Administration on July 24, 1990. The Social Security Administration denied the plaintiff's initial claim, and reaffirmed its denial after reconsideration requested by the plaintiff. After a hearing before an administrative law judge on June 17, 1991, plaintiff's application was approved, and she commenced receiving social security benefits in March, 1992. The award notification recommended reevaluation of plaintiff's condition in six months.
Statement of Uncontested Facts, No. 14, which the plaintiff admitted.
During the period that plaintiff was receiving benefit payments under the Plan, between 1990 and 1993, Provident periodically requested that plaintiff provide updated proofs of disability by completing claim forms and submitting medical reports. In February and March, 1992, Provident asked plaintiff to update proof of disability by completing a claim form. Provident received plaintiff's updated claimant's statement and physician's statement on April 28, 1992. Dr. Gary stated that there was no change in plaintiff's condition since initially being seen. Again, in May of 1993, Provident requested that plaintiff update her proof of disability. On June 7, 1993, Provident received her claimant's statement and Dr. Gary's physician's statement, enclosing medical records, and stating that plaintiff had been previously declared disabled. By letter dated June 9, 1993, Provident asked Dr. Gary to provide additional information by completing a physical capacities form. Provident also obtained reports from its medical advisor, Dr. Charles J. Leagus.
Statement of Uncontested Facts, Nos. 15 through 20, which the plaintiff admitted.
By letters dated June 18, 1993 and July 16, 1993, Provident informed the plaintiff that it was exercising its right of physical examination contained in the Plan and that an appointment would be scheduled with a specialist at Provident's expense. On July 22, 1993, Quality Care Systems, Inc. notified the plaintiff that an appointment had been scheduled with Dr. James Maultsby for August 2, 1993.
Statement of Uncontested Facts, No. 21, which the plaintiff admitted. The Court here notes that the plaintiff did not dispute that she was so notified, but only, that the physical examination was performed by an "independent" company. See, Plaintiff's Response at No. 21.
Statement of Uncontested Facts, No. 22, which the plaintiff admitted.
Pursuant to Dr. Maultsby August 2, 1993 examination of the plaintiff, Dr. Maultsby reported that plaintiff had no difficulty sitting for long periods of time and further concluded that she was capable as working as a secretary, to wit:
. . . She [i.e., plaintiff] is making this long trip [i.e., from Louisiana to New York] in a truck that requires her to sit for many hours at a time and she apparently does this without difficulty. In addition, because of the load in my office, she sat in the waiting room for an extended period of time and then in the examining room with no difficulty. After she was examined, she was sent to x-ray and then back again and waited in the examining room and when I came in she was sitting without difficulty. Therefore, part of the examination was obviously observing her to sit and I see no reason why she cannot work as a secretary sitting and that is her main function.
* * *
. . . I see no reason why she cannot work as a secretary sitting and that is her main function . . . It is my impression that patient is definitely magnifying her symptoms. There is a component of hysteria or malingering and I think most likely the latter is the case. I do not feel her physical complaints or her findings would prohibit her from performing sedentary type work such as a secretary's job. . . . It is my impression her complaints are not valid.
Report of Dr. James A. Maultsby, M.D., Defendant's Exhibit A-31.
By letter dated September 2, 1993, Provident forwarded Dr. Maultsby's evaluation to Dr. Gary, and asked Dr. Gary to "report any differences which you may have," enclosing an evaluation form, requesting additional comments, and asking for a response within 30 days.
Statement of Uncontested Facts, No. 24, which the plaintiff admitted.
On September 16, 1993, Provident requested Quality Care Systems to schedule a functional capacity evaluation, and so informed the plaintiff on that date. On October 14, 1993, Plaintiff underwent a functional capacities evaluation (FCE) performed by Workable Industrial Rehabilitation Services. The summary of the results of the FCE performed on plaintiff indicated:
Statement of Uncontested Facts, No. 25. See also, Plaintiff's Response, at 25.
[Plaintiff] is currently functioning at light/sedentary physical demand level. . . . Ms. Chabert DOES meet the physical demands of the job . . . Clerk Typist; Administrative Secretary.
The aforesaid FCE noted plaintiff's concern about being able to complete a 6-8 hour work day and her statement that she functions better in the morning. Despite the fact the FCE was performed in the afternoon, when according to the plaintiff she is not at her best, the assessment outcome was that the plaintiff did meet her job requirements.
Workable's October 20, 1993 Functional Capacity Evaluation Report [Defendant's Exhibit A-38].
By certified letter dated November 8, 1993, Provident informed plaintiff that, based upon the findings of the independent medical exam and the vocational rehabilitation evaluation, as well as the medical records in her file, she no longer was eligible for disability benefits under the Plan provision applicable after July 23, 1993, which defines total disability, and her final payment was issued October 27, 1993, for the last monthly period ending October 31, 1993, as follows:
Based on the findings of these reports as well as other medical records in your file, we find that you are capable of performing some occupations in the sedentary or light range. Because the medical records reflect that you are capable of performing light occupations, Long Term Disability benefits are no longer payable under the group plan. [Defendant's Exhibit A-38].
Plaintiff was also notified in this letter of the procedures for appealing the decision. Plaintiff followed the administrative procedures provided for in the Plan which culminated in her appeal of the decision denying disability benefits.
Statement of Uncontested Facts, No. 28, which plaintiff admitted.
On appeal, plaintiff's counsel supplemented the administrative record with a letter and report of a recent medical examination by Dr. B.G. Trosclair. Other than Dr. Trosclair's report, no additional information was submitted on behalf of the plaintiff to substantiate her claim on appeal.
Dr. Trosclair concluded in his report that: "Criteria for total disability is not supported by review of data and physical findings . . ." Although Dr. Trosclair mentioned plaintiff'ssubjective pain in the lower back and coccyx, he further noted that the plaintiff "is ambulatory and drives her car in spite of her pain symptoms."
Report of Dr. Trosclair dated October 26, 1993 [Defendant's Exhibit A-42.
The ERISA Committee met on January 11, 1994, and based upon the administrative record determined that the plaintiff was no longer totally disabled as that term is defined by the Plan and upheld the termination of disability payments to the plaintiff. By letter dated January 26, 1994, Provident informed plaintiff's counsel that the ERISA Committee had reviewed the medical records from Dr. Trosclair and counsel's letter, and informed him that the Committee would uphold the termination of Long Term Disability Benefits noting that plaintiff's medical records indicate that she is capable of performing some occupations in the sedentary/light range. It further explained that their determination was supported by the examination by Dr. Maultsby and the report of FCE on the plaintiff. Additionally, the letter referred to Dr. Trosclair's report which was submitted on behalf of the plaintiff, wherein Dr. Trosclair expressed the opinion that the criteria for total disability was not supported by his review of the data and physical findings with respect to Ms. Chabert.
Affidavit of Owen Robert [Defendant's Exhibit "D"].
Provident Letter dated January 26, 1994 [Defendant's Exhibit A-43].
Analysis
Summary judgment is appropriate when "there is no genuine issue as to any material fact" and "the moving party is entitled to judgment as a matter of law." FRCP Rule 56(c). The purpose of summary judgment is to determine whether a trial will be necessary. "The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 91 L.Ed.2d 202, 106 S.Ct. 2505 (1986).It is undisputed that Discovery Chemicals' Plan is an ERISA welfare benefit plan. 29 U.S.C. § 1003. Ordinarily, if the plan administrator is not vested with discretionary authority to interpret plan terms, then the administrator's decision should be reviewed de novo. Firestone Tire Rubber Company v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). However, the test applies only to cases involving plan interpretation.
In Pierre v. Connecticut General Life Insurance Company, 932 F.2d 1552, 1557 (5th Cir.), cert. denied, 112 S.Ct. 453 (1991), the Fifth Circuit explained, that there are two parts involved in a decision regarding eligibility for benefits, to wit: (1) the administrator determines the facts; and (2) the administrator interprets the plan. It is the second part of the analysis, i.e., plan interpretation, which may be subject to de novo review, depending upon the language of plan, that is, whether it confers discretion upon the administrator.
Here, as in the Pierre case, there is an absence of plan language conferring discretionary power on the plan administrator. Notwithstanding the foregoing, the Fifth Circuit held that "for factual determinations under ERISA plans, the abuse of discretion standard of review is the appropriate standard; that is, federal courts owe due deference to an administrator's factual conclusions that reflect a reasonable and impartial judgment." Id. at 1562.
This Court agrees with the defendant, that this case does not even remotely turn on sophisticated plan interpretation issues. Although, the plaintiff's counsel submits generally as a matter of argument that this case involves plan interpretation, no portion of the pertinent plan language defining total disability is even arguably ambiguous. The Plan unambiguously provides disability benefits only if:
(1) you are not able to do each of the material duties of your job during the first the 3 years that benefits are paid and you do not work at any other occupation; and
(2) after benefits have been paid for 3 years, you are not able to do each of the material duties of any job for gain or profit for which you are reasonably fitted by education, training or experience.
Statement of Uncontested Material Fact No. 7, which the plaintiff admitted.
The sole issue before this Court is whether the evidence contained in the administrative record demonstrates that the plaintiff could perform clerical jobs, for which she was fitted by education, training or experience. There is evidence in the record set forth in detail above that plaintiff was capable of performing her job as a secretary and/or light sedentary work for which she is qualified by education, training and experience.
This leaves the Court with a review of the plan administrator's factual determination. The specific inquiry before this Court is whether or not the facts and evidence in this case justified the discontinuation of plaintiff's long term disability benefits. When reviewing an administrator's factual determination, the reviewing court applies the abuse of discretion standard. Pierre, 932 F.2d at 1562.
When reviewing such a factual determination, the Court is limited to the evidence presented to the administrator at the time the final decision was rendered. Id. at 1559. In Rhodes v. Panhandle Eastern Corporation, 1993 U.S.Dist. LEXIS 12212 (E.D. La. August 31, 1993), on defendant's motion for summary judgment this Court upheld the denial of plaintiff's extended disability benefits, holding that there was "substantial evidence" justifying the Plan's factual determination that the plaintiff was not permanently and totally disabled and explained: "Substantial evidence is such evidence that a reasonable mind might accept as adequate to support the conclusion reached by the [decision maker]. Substantial evidence requires `more than a scintilla, but less than a preponderance.'" Id. (quoting, Sandoval v. Aetna Life Casualty Insurance Company, 967 F.2d 377, 382 (10th Cir. 1992)).
Applying the foregoing principles to the case at bar, the Court is of the opinion that there is "substantial evidence" in the record that plaintiff in the instant case was able to perform a clerical/sedentary job for which she was qualified. Plaintiff began receiving benefits for the period beginning July 24, 1990, at the end of the applicable six-month elimination period. Thus, after July 23, 1993, plaintiff was "totally disabled" within the meaning of the Plan, only if she was:
not able to do each of the material duties of any job for gain or profit for which [she] is reasonably fitted by education, training or experience.
Prior to terminating plaintiff's disability benefits the ERISA Committee considered all of the medical and vocational expert reports and concluded that the plaintiff was capable of performing her job as secretary noting that secretarial functions are classified as light to sedentary work.
In addition to plaintiff's entire claims file, the Committee had before it the report of Dr. Maultsby who concluded that plaintiff's physical complaints and physical findings would not prohibit her from performing sedentary type work such as a secretary's job. [Defendant's Exhibit A-31] Dr. Maultsby observed that she had no difficulty sitting for many hours at a time and that she did so without any difficulty. The vocational rehabilitation center, Workable, which performed the functional capacities evaluation on plaintiff on October 14, 1993, concluded that plaintiff met the physical demands of the job of Clerk typist/Secretary. [Defendant's Exhibit A-37].
Provident favored Dr. Gary with copies of the aforesaid reports and findings, inviting his reply and/or comments. The Court notes that Dr. Gary's earlier May 18, 1993 report is fairly "light" and/or superficial. Dr. Dexter's May 18th report refers to his earlier reports, to the plaintiff's statements that she has been declared disabled and is on medicare, and that she comes in for an annual evaluation because she has been referred by an insurance company for an evaluation. Whereas the plaintiff complains that the Plan administrator was "expert shopping", it rather appears to this Court based upon a review of the administrative record that the Plan administrator "lost confidence" in Dr. Gary. His task was to re-evaluate the plaintiff, as opposed to deferring to his prior evaluations and to plaintiff's own statements regarding an earlier disability determination.
Dr. B.G. Trosclair, who examined the plaintiff on October 26, 1993 at plaintiff's request, concluded in his report submitted on behalf of the plaintiff that the criteria for total disability was not supported by his review of the data and physical findings.
In this Court's opinion, the foregoing constitutes substantial evidence not only that the plaintiff was capable of performing any job for which she was qualified, but was in fact capable of performing her job as secretary. The Court here notes that there was no evidence submitted by the plaintiff to the Committee that she was incapable of performing any job for which she was qualified by education, training or experience. Clearly there was no abuse of discretion in terminating plaintiff's benefits.
That there exists conflicting medicals in the record is of no moment. This Court's responsibility is to determine whether an administrator's actions constituted an abuse of discretion, and not in determining whether the plaintiff in this case was, in this Court's view, entitled to disability benefits within the meaning of the Plan.
As contrasted with the typical summary judgment scenario, it matters not that there may be conflicting evidence concerning ultimate historical facts which underlie the plaintiff's claim. Indeed, that is quite the point of the administrator's claim resolution function. Where, as here, an ERISA claim determination depends upon the resolution of facts, it can be presumed that there will be conflicting evidence, as well as, perhaps, issues of credibility concerning the "facts." But it is the administrator who is called upon in the first instance to evaluate the evidence and resolve any conflicts or credibility issues. The court performs a review function, and its role is limited to determining whether the administrator exercised its decision-making prerogative in a reasonable and impartial manner. Cf. Pierre v. Connecticut Gen. Life Ins. Co., 932 F.2d 1552, 1559, 1562 (5th Cir.), cert. denied, 112 S.Ct. 453 (1991) ("courts simply cannot supplant plan administrators, through de novo review, as resolvers of mundane and routine fact disputes;" rather, "abuse of discretion standard best balances the need to respect plan administrator's factual determinations and the need to protect beneficiaries by providing some judicial review of those decisions.")
In making its determination that the plaintiff was no longer entitled to disability benefits, it is apparent from the record that the Committee placed particular importance on the opinions of Drs. Maultsby and Trosclair, and the results of the functional capacities evaluation performed on October 14, 1993 by Workable Industrial Rehabilitation Services.
Counsel for the plaintiff in the case at bar refers generically to a conflict of interest and to some unidentified dispute regarding plan interpretation. However, plaintiff counsel has come forward with no evidence defining any possible conflict of interests. In any event, it is manifest that an administrator's conflict of interest, if any, "must be weighed as a `factor in determining whether there was an abuse of discretion.'" Firestone Tire Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989) (citations omitted). See also Lowry v. Bankers Life Casualty Retirement Plan, 871 F.2d 522, 525 (5th Cir. 1989) ("plan administrator's conflict of interest is certainly material to judicial review under our circuit's pre-Bruch arbitrary and capricious standard"). Although the existence of a conflict of interest does change the manner in which the abuse of discretion standard is applied, it does not change the standard of review, which remains one of abuse of discretion. In this circuit, "`less deference [is given] to a decision the more the [administrator's] impartiality can be fairly questioned.'"
See Salley v. E.I. DuPont de Nemours Co., 966 F.2d 1011, 1014 (5th Cir. 1992) (wherein the fact that employer reserved final authority to authorize or deny benefit payments and funded plan from operating revenues had apparent incentive to deny benefits, such alleged conflict did not change the standard of review but was weighed as a factor in determining whether there was an abuse of discretion).
Lowry v. Bankers Life Casualty Retirement Plan, 871 F.2d 522, 525 n. 6 (5th Cir. 1989) (quoting Van Boxel v. Journal Employees' Pension Trust, 836 F.2d 1048, 1052-53 (7th Cir. 1987)).
Given the state of the record in this case and for the reasons discussed above, the Court would be hard-pressed to conclude that the "fact" of a possible conflict precludes summary judgment in this case. Additionally, the plaintiff has identified no ambiguity in the pertinent plan language, which might possibly give this Court any reason to consider plan interpretation a material issue in this case. Plaintiff's counsel's unsupported statements that there exists a genuine issue as to plan interpretation and some conflict of interest do not rise to the level of disputed material issues of fact, such that summary judgment is inappropriate.
Plaintiff has not suggested how the postponement of a decision in this case pending a trial might alter the court's analysis of her claim. She has not so much as intimated what, if any, evidence she might present if a trial were held. The facts which relating to the alleged conflict of interest are in the record and would not change if a trial were ordered. There is no interest to be served by awaiting trial. Even assuming a finding at the time of trial that the administrator's factual determination is entitled to only the slightest deference, this Court would remain unable to conclude based upon the administrative record that plan administrator abused its discretion in terminating plaintiff's disability benefits.
There is no question but that plaintiff in this case was given the opportunity to refute Dr. Maultsby's opinion that the plaintiff was capable of performing her job. Plan fiduciaries have the primary responsibility of claims processing. "Claimantsmust present their strongest case to the plan administrator, because the primary decision is made at that point."
Duhon v. Texaco, Inc., 15 F.3d 1302, 1309 (5th Cir. 1994).
Here, as in Pierre, supra, the standard of review is one of deference to the Plan Administrator's factual determinations. In summary judgment parlance, in order to avoid a properly supported motion for summary judgment, plaintiff in this case is required to demonstrate that in making its choices and judgments regarding conflicting versions of the facts and/or credibility, the plan administrator acted without any substantial basis, i.e., abused its discretion and/or failed to render a decision that was impartial. Plaintiff has failed to come forward with evidence tending to demonstrate that the Plan Administrator abused its discretion and/or acted in an arbitrary and capricious manner applying the facts to the unambiguous plan provision at issue.
This case is indisputably governed by ERISA which preempts the plaintiff's state law claims. Accordingly and for all of the above and foregoing reasons,
The Court here notes that in opposition memorandum, counsel for plaintiff did not address the effect of ERISA's broad preemption provision on plaintiff's state law claims. There appears to be no dispute that plaintiff's state law claims are preempted.
IT IS ORDERED that defendant Provident Life Accident Insurance Company's Motion for Summary Judgment is hereby GRANTED and plaintiff Wanda Chabert's claims in the captioned matter against the aforesaid defendant are hereby DISMISSED WITH PREJUDICE.
The Clerk of Court is directed to enter Judgment in accordance herewith.