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Gary v. Unum Life Insurance Co. of America

United States District Court, D. Oregon

March 12, 2018

ALISON GARY, an individual, Plaintiff,
v.
UNUM LIFE INSURANCE COMPANY OF AMERICA, a Maine corporation, as administrator of the Dickstein Shapiro LLP Group Long Term Disability Plan, Defendant.

          Arden J. Olson HARRANG LONG GARY RUDNICK P.C. Attorney for Plaintiff Robert B. Miller

          KILMER, VOORHEES & LAURICK, P.C. Attorney for Defendant

          OPINION & ORDER

          Marco A. Hernandez United States District Judge

         Plaintiff Alison Gary brings this action under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001-1461 (ERISA), alleging that Defendant Unum Life Insurance Company of America wrongfully denied her application for long-term disability benefits. Plaintiff moves for summary judgment on her second claim for relief contending that Defendant violated her right to a "full and fair review" of the denial under 29 U.S.C. § 1133 and its implementing regulation, 29 C.F.R. § 2560.503-1. She seeks the retroactive reinstatement of long-term disability benefits from April 6, 2015 to the date of judgment in this case. I grant the motion in part and deny it in part. I agree with Plaintiff that Defendant violated § 1133 but I find that a retroactive reinstatement of benefits is not the appropriate remedy.

         BACKGROUND

         In September 2012, Plaintiff became employed as an attorney at Dickstein Shapiro LLP. First Am. Compl. ¶ 5, ECF 24. Dickstein Shapiro has a Group Long Term Disability Plan administered by Defendant. Id. ¶¶ 1, 2. Plaintiff asserts that she became totally disabled and that her physician ordered her to cease practicing law on November 27, 2013. Id. ¶ 5. She stopped practicing law the next business day, December 1, 2013, and alleges that she has been unable to practice law since that date. Id.

         On September 1, 2016, Plaintiff filed a claim for long-term disability (LTD) benefits with Defendant, seeking benefits since the November 27, 2013 disability onset date. Olson Nov. 30, 2017 Decl. ¶ 1, ECF 10. In seeking LTD benefits, Plaintiff noted that she "is, and was at all times from the beginning" of her eligibility, "disabled under the terms of the policy." Miller Jan. 5, 2018 Decl., Ex. 1 at 1, ECF 20-1. She asserted that she became disabled one year after she began working at Dickstein Shapiro, and "continues to remain unable to work as an attorney[.]" Id., Ex. 1 at 2. She recited several facts about her impairments and treatment from November 2013 through October 2016 and in conclusion asserted that she "is and has continuously since November 2013 been completely disabled under the terms of the LTD Plan." Id., Ex. 1 at 5. She also included more than sixty pages of medical records. Id., Ex. 1 at 6-69.

         Defendant initially responded with a request for additional information and a one month payment of benefits under a reservation of rights. Olson Nov. 30, 2017 Decl. ¶ 3 & Ex. 1, ECF 10-1. Then, on February 24, 2017, Defendant sent a letter to Plaintiff denying her claim ("the February 24, 2017 decision letter" or "the Initial Denial"). Id. ¶ 4 & Ex. 2[1], ECF 10-2. In the section entitled "Decision/Reason, " Defendant wrote: "We have determined your client was not disabled through the 180 day elimination period. Because [Plaintiff] was not disabled through this period, according to the policy, benefits are not payable." Id., Ex. 2 at 1. Defendant's February 24, 2017 decision letter included two single-spaced pages under the heading "Information That Supports Our Decision, " discussing the evidence Defendant reviewed in assessing Plaintiff's claim. Id., Ex. 2 at 2-4. First, Defendant explained that the policy has a 180-day elimination period during which time the claimant must be continuously disabled in order to receive disability benefits. Id., Ex. 2 at 2. In this case, the elimination period began on November 27, 2013 and ended May 25, 2014. Id. Next, Defendant cited to various medical records provided by Plaintiff. Id., Ex. 2 at 2-4. Following that, Defendant provided relevant policy provisions for defining disability, the elimination period, and termination of coverage. Id., Ex. 2 at 4-5. Finally, the February 24, 2017 decision letter included an explanation of Plaintiff's right to appeal, how to pursue an internal appeal, and if necessary, the right to file an ERISA action in court. Id., Ex. 2 at 6-7.

         Plaintiff filed her administrative appeal on June 8, 2017. Olson Nov. 30, 2017 Decl. ¶ 5. In support, she submitted a fifty-one page, mostly single-spaced letter, along with thirty-two exhibits totaling more than two hundred pages. Miller Jan. 5, 2018 Decl. ¶ 3 & Ex. 2, ECF 20-2.

         Defendant responded to the appeal in a July 26, 2017 letter ("the Final Decision."). Olson Nov. 30, 2017 Decl. ¶ 6 & Ex. 3, ECF 10-3. The Final Decision explained Defendant's "Appeal Decision" as follows:

On appeal, we have determined [Plaintiff] was disabled from Nov. 27, 2013, through April 6, 2015. We are approving LTD benefit payments for that period.
After April 6, 2015, we have concluded [Plaintiff] was able to perform the duties of [her] regulation occupation and no longer met the definition of disability in the policies.

Id., Ex. 3 at 2. The Final Decision included a several page, single-spaced section with information supporting Defendant's decision, followed by applicable policy provisions including the definition of disability. Id., Ex. 3 at 2-9. It also explained that if Plaintiff disagreed with the decision, she could file a civil ERISA suit. Id., Ex. 3 at 10. No right to an internal review was mentioned. This lawsuit followed.

         STANDARDS

         Summary judgment is appropriate if there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The moving party bears the initial responsibility of informing the court of the basis of its motion, and identifying those portions of "'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, ' which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (quoting former Fed.R.Civ.P. 56(c)).

         Once the moving party meets its initial burden of demonstrating the absence of a genuine issue of material fact, the burden then shifts to the nonmoving party to present "specific facts" showing a "genuine issue for trial." Fed. Trade Comm'n v. Stefanchik, 559 F.3d 924, 927-28 (9th Cir. 2009) (internal quotation marks omitted). The nonmoving party must go beyond the pleadings and designate facts showing an issue for trial. Bias v. Moynihan, 508 F.3d 1212, 1218 (9th Cir. 2007) (citing Celotex, 477 U.S. at 324).

         The substantive law governing a claim determines whether a fact is material. Suever v. Connell, 579 F.3d 1047, 1056 (9th Cir. 2009). The court draws inferences from the facts in the light most favorable to the nonmoving party. Earl v. Nielsen Media Research, Inc., 658 F.3d 1108, 1112 (9th Cir. 2011).

         If the factual context makes the nonmoving party's claim as to the existence of a material issue of fact implausible, that party must come forward with more persuasive evidence to support his claim than would otherwise be necessary. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).

         DISCUSSION

         I. Applicable ERISA Statute & Regulation ERISA imposes various obligations on employee benefit plans, including prescribing certain claim procedure requirements. Section 1133 provides that "[i]n accordance with regulations of the Secretary, every employee benefit plan shall":

(1) provide adequate notice in writing to any participant or beneficiary whose claim for benefits under the plan has been denied, setting forth the specific reasons for such denial, written in a manner calculated to be understood by the participant, and
(2) afford a reasonable opportunity to any participant whose claim for benefits has been denied for a full and fair review by the appropriate named fiduciary ...

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