Opinion
Case No. 8:99-cv-2688-T-24MAP
January 31, 2001
ORDER
This cause comes before the Court for consideration of Defendants' Motion for Summary Judgment (Doc. No. 20, filed December 1, 2000) and Plaintiff's Motion for Summary Judgment (Doc. No. 24, filed December 1, 2000).
Plaintiff brought this action seeking to recover Long Term Disability ("LTD") benefits under an employee welfare benefit plan sponsored by Rudnick Wolfe, a law firm, and administered by Canada Life. Plaintiffs claim arises under § 1132(a)(1)(B) of the Employee Retirement Income Security Act of 1974 ("ERISA"). The Plaintiff was employed and actively working at the law firm from September 30, 1987 to April 9, 1998, when she stopped working on the advice of her treating physician, Susan Steen, M.D. In October of 1998, Plaintiff submitted a claim for LTD benefits to Canada Life after receiving short term disability benefits from Rudnick Wolfe for six month. An Attending Physicians Statement from Dr. Steen indicated that the diagnosis was Reflex Sympathetic Dystrophy ("RSD"), cervical spasm and migraines. Plaintiff indicated that her claim was due to injuries she sustained in automobile accidents in 1992 and 1997 and from a needle stick for drawing blood that injured her left arm in 1995, which resulted in RSD.
Section 1132(a)(1)(B) provides in relevant part that a civil action may be brought "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B).
Canada Life ultimately determined that Plaintiff was not disabled under the terms of the policy. Plaintiff brought this suit on November 24, 1999 seeking the LTD benefits under the policy. Each party now moves for summary judgment.
Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The moving party bears the initial burden of showing the Court, by reference to materials on file that there are no genuine issues of material fact that should be decided at trial.Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Clark v. Coats Clark, Inc., 929 F.2d 604 (11th Cir. 1991). When the party moving for the summary judgment does not bear the burden of persuasion on the issue at trial, the moving party discharges its burden on a motion for summary judgment by "showing or pointing out" to the Court that there is an absence of evidence to support the non-moving party's case. Celotex, 477 U.S. at 325. Rule 56 permits the moving party to discharge its burden with or without supporting affidavits and to move for summary judgment on the case as a whole or on any claim. Id. When a moving party has discharged its burden, the non-moving party must then "go beyond the pleadings," and by its own affidavits, or by "depositions, answers to interrogatories, and admissions on file," designate specific facts showing that there is a genuine issue for trial. Id. at 324.
In determining whether the moving party has met its burden of establishing that there is no genuine issue as to any material fact and that it is entitled to judgment as a matter of law, the Court must draw inferences from the evidence in the light most favorable to the non-movant and resolve all reasonable doubts in that party's favor.Spence v. Zimmerman, 873 F.2d 256 (11th Cir. 1989); Samples on behalf ofSamples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir. 1988). The Eleventh Circuit has explained the reasonableness standard:
In deciding whether an inference is reasonable, the Court must "cull the universe of possible inferences from the facts established by weighing each against the abstract standard of reasonableness." [citation omitted]. The opposing party's inferences need not be more probable than those inferences in favor of the movant to create a factual dispute, so long as they reasonably may be drawn from the facts. When more than one inference reasonably can be drawn, it is for the trier of fact to determine the proper one.WSB-TV v. Lee, 842 F.2d 1266, 1270 (11th Cir. 1988).
Thus, if a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, then the court should not grant the summary judgment motion. Augusta Iron Steel Works v. Employers Insurance of Wausau, 835 F.2d 855, 856 (11th Cir. 1988). A dispute about a material fact is "genuine" if the "evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The inquiry is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52.
The United States Supreme Court, in Firestone Tire Rubber Co. v. Bruch, 489 U.S. 101 (1989), set forth the following standard of review that a court must apply when reviewing a denial of ERISA benefits:
Consistent with established principles of trust law . . . a denial of benefits challenged under § 1132(a)(1)(B) is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.Id. at 115. The Eleventh Circuit has adopted three standards of review for plan interpretations: (1) de novo, applicable where the plan administrator is not afforded discretion, (2) arbitrary and capricious when the plan grants the administrator discretion, and (3) heightened arbitrary and capricious where there is a conflict of interest. Paramore v. Delta Air Lines. Inc., 129 F.3d 1446, 1449 (llth Cir. 1997).
Generally, courts review claims administrators' denials of ERISA benefits under the de novo standard. However, when the plan document explicitly vests the claims administrator with discretion to determine eligibility for benefits or to construe disputed or doubtful terms, the arbitrary and capricious standard is applied.
The policy in this case defines "totally disabled" as "unable to work and . . . unable to perform the substantial and material duties of his own occupation." The policy states that "[p]ayments will be made . . . provided initial proof that the person is disabled is given to [Canada Life] at our Head Office. This proof must be satisfactory to [Canada Life]." Further, the policy provides that the claim will be paid when Canada Life "receive[s] satisfactory proof of [the] claim." Finally, Canada Life has the right "to have a physician examine anyone in respect of whom a claim is being made."
Many courts have construed similar language to vest the claims administrator with discretion to determine eligibility for benefits.See, e.g., Perez v. Aetna Life Ins. Co., 150 F.3d 550, 555-58 (6th Cir. 1998); Patterson v. Caterpillar. Inc., 70 F.3d 503, 505 (7th Cir. 1995);Donato v. Metropolitan Life Ins. Co., 19 F.3d 375, 378-80 (7th Cir. 1994);. see also Metropolitan Life Ins. Co. v. Potter, 992 F. Supp. 717, 724 (D.N.J. 1998); Scarinci v. Ciccia, 880 F. Supp. 359, 364 (E.D. Pa. 1995); Sorrrells v. Sun Life Assurance Co., 85 F. Supp.2d 1221, 1227-30 (S.D. Ala. 2000).
Based on the language in the policy, the Court finds that the policy provides Canada Life with discretionary authority in its claims decisions, and, therefore, Canada Life's decisions are subject to the arbitrary and capricious standard. Both parties agree that if the Court finds that Canada Life has discretionary authority, the heightened arbitrary and capricious standard applies because Canada Life is both the claims administrator and the insurer of the policy and, therefore, a potential conflict of interest exists. Brown v. Blue Cross Blue Shield, 898 F.2d 1556, 1562 (11th Cir. 1990), cert. denied, 498 U.S. 1040 (1991).
Applying the heightened arbitrary and capricious standard, the plaintiff must establish that the decision made by the ERISA administrator was "wrong." Id. at 1566-67 n. 12. If the claims administrator can be shown to have made a "wrong" decision, then the burden shifts to the administrator to show that its denial of benefits was not arbitrary or capricious. To do this, the administrator must show that any taint of self-interest does not exist.
Once it is shown that there is no taint of self-interest, the final leg of the review process is to apply the normal arbitrary and capricious review. Under the arbitrary and capricious review "the function of the court is to determine whether there was a reasonable basis for the decision, based upon the facts as known to the administrator at the time the decision was made." Jett v. Blue Cross Blue Shield, 890 F.2d 1137, 1139 (11th Cir. 1989).
The term "arbitrary and capricious" is sometimes used interchangeably with the term "abuse of discretion." Jett v. Blue Cross Blue Shield, 890 F.2d 1137, 1139 (11th Cir. 1989).
Accordingly, this Court must first review the evidence de novo to determine whether Canada Life's factual determination that Plaintiff failed to meet the definition of "totally disabled" was legally correct.Brown, 898 F.2d at 1566. The policy defines "totally disabled" as "the person is unable to work and . . . [d]uring the elimination period and for the next 24 months after the elimination period in a continuous period of disability, the person is unable to perform the substantial and material duties of his own occupation . . . ."
Reviewing all evidence submitted de novo, this Court cannot categorize Canada Life's denial of Plaintiff's claim as "wrong." of all the doctors who had seen and treated the Plaintiff, only one, Dr. Steen, was of the opinion that Plaintiff could not work as a legal secretary, with that opinion being based solely on Plaintiffs subjective complaints. Two neurological IMEs were negative and both examining doctors were of the opinion that Plaintiff could work full time: one stating that she was able to work full time with no restrictions, and the other with only a 25-pound weight lifting restriction.
Because the Court finds that Canada Life's decision denying benefits under the policy was not "wrong," the Court need not reach the issue of self-interest of the fiduciary.
Accordingly, it is ORDERED AND ADJUDGED that:
(1) Defendants' Motion for Summary Judgment (Doc. No. 20) is GRANTED.
(2) Plaintiff's Motion for Summary Judgment (Doc. No. 24) is DENIED.
(3) The Clerk is directed to enter judgment in favor of the Defendants and CLOSE this case.