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Glover v. Jefferson Pilot Financial Insurance Co.

February 21, 2007


The opinion of the court was delivered by: Garnett Thomas Eisele United States District Judge


This ERISA case is before the Court on cross-motions for summary judgment. Plaintiff Brenda Glover appeals the denial of benefits under a Long Term Disability Insurance Plan (hereinafter "LTD Plan") sponsored by her employer, Odom's Tennessee Pride Sausage, Inc. ("Odom"). For the following reasons, the Court reverses the decision of Jefferson Pilot Financial Insurance Company to deny Plaintiff the full twenty-four months of "own occupation" long-term disability benefits. The Court remands this case solely for the purpose of determining whether Plaintiff is entitled to receive "any occupation" long-term disability benefits.

I. Overview

Plaintiff Brenda Glover was hired by Odom's as a Packer in its Boning Department on May 24, 2002. Plaintiff's responsibilities included packing and sawing ribs, removing defects, maintaining quality and yields, keeping the product off the floor, and sanitizing the equipment prior to her shift. Odom sponsored an employee welfare benefit plan that provided both short and long-term disability benefits. Jefferson Pilot Financial Insurance Company ("Jefferson Pilot") issued to Odom a group policy used to fund such benefits.

On May 9, 2004, Plaintiff was involved in a car accident. Plaintiff stopped working due to cervical and lumbar strain on May 11, 2004. Ultimately, Jefferson Pilot approved and paid short-term and long-term benefits as of May 19, 2004, through April 10, 2005. Jefferson Pilot denied benefits beyond April 10, 2005.

After exhausting her appeals with Jefferson Pilot, Plaintiff Glover filed the present lawsuit seeking back benefits, attorney's fees and costs on February 17, 2006. Plaintiff originally filed her Complaint in Pulaski County Circuit Court, but the Defendants timely and properly removed the action based on the fact that the LTD Plan at issue is an employee welfare benefit plan governed by ERISA, a federal law. ERISA provides that the resolution of benefit claims under ERISA governed plans shall be determined exclusively by federal law. 29 U.S.C. § 1132(a)(1)(B); Prudential Ins. Co. of America v. National Park Medical Center, Inc., 413 F.3d 897, 907 (8th Cir. 2005).

II. The Plan

The LTD plan at issue defines "total disability" as:

TOTAL DISABILITY OR TOTALLY DISABLED means that an Insured Employee, due to an injury or Sickness is unable:

1. during the Elimination Period and the Own Occupation Period, to perform each of the main duties of the Insured Employee's regular occupation; and

2. after the Own Occupation Period, to perform each of the main duties of any gainful occupation for which the Insured Employee's training, education, or experience will reasonably allow. (AR 0432).

The "Own Occupation Period" is twenty-four months. It appears that this period began for Glover on August 10, 2004. (AR 0159). Accordingly, Plaintiff would be entitled to recover disability benefits for the 24 month period beginning August 10, 2004, by showing that she could not perform her prior duties as a boner on Tennessee Pride's assembly line. After 24 months, Glover would not be considered disabled unless her injuries prevented her from performing "any gainful occupation."

The parties dispute the appropriate burden of proof in light of the fact that Jefferson Pilot initially awarded long-term disability benefits, but then reversed its earlier decision. The consensus view appears to be that while the Eighth Circuit has not explicitly required a change in the insured's condition before an insurer may terminate disability benefits, it does require that a termination of disability benefits requires a significant change in the information available to the insurer between the granting and the terminating of benefits. See Morgan v. Unum Life Ins. Co. of Am., 346 F.3d 1173, 1178 (8th Cir.2003); McOsker v. Paul Revere Life Ins. Co., 279 F.3d 586, 589 (8th Cir.2002); Walke v. Group Long Term Disability Ins., 256 F.3d 835, 840 (8th Cir.2001). That did not happen in this case.

Additionally, although the Court has not found a case explicitly addressing this issue, it appears that under the language of this Plan, the Plaintiff arguable was entitled to notice and an opportunity to submit proof that she remained disabled. The Plan language requires the payment of disability benefits if the insured employee:

1. is Totally Disabled;

2. requires the regular attendance of a Physician; and

3. submits proof of continued Total Disability, at the Insured Employee's expense, to the Company upon request.

(AR 0441). The Plan further provides that "Proof of continued Disability and regular attendance of a Physician must be given to the Company within 30 days of the request of proof." (AR 0434). Read in context, the Court concludes that the claimant for disability benefits must submit proof to show that she is disabled in the first instance and she must continue to provide such proof upon Jefferson Pilot's request. However, the LTD Plan also contemplates that Jefferson Pilot must both request the information and allow Plaintiff time to provide it before terminating disability benefits previously awarded. Jefferson Pilot failed to comply with that provision in this case.

In the Court's view, there are two problems with the manner in which Jefferson Pilot terminated Plaintiff's benefits. First, there was no significant change in the information available to Jefferson Pilot between its decision to grant and to terminate benefits. Second, on the record, Jefferson Pilot should have provided Plaintiff with notice and an opportunity to show that she remained disabled before terminating her benefits.

III. Standard of Review

District courts review an ERISA plan administrator's decision to terminate benefits de novo,unless the benefits plan vests the administrator with the discretionary authority to determine benefits eligibility or to interpret the terms of the plan. Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 957-58 (1989). Where the plan administrator has such discretionary powers, courts review a denial-of-benefits claim with a deferential eye, overturning the administrator's decision only if it was "arbitrary and capricious." See, e.g., Lickteig v. Business Men's Assur. Co. of America, 61 F.3d 579, 583 (8th Cir. 1995).

Odom's LTD Plan lacks any language providing the plan administrator with discretionary authority to determine benefit eligibility or to construe plan terms. The Defendants have not explicitly conceded this point. However, they have failed to point to any Plan language that would trigger a discretionary standard of review or to otherwise contradict Plaintiff's contention that a de novo standard applies, and thereby implicitly conceded the point. Accordingly, the Court is obliged to review de novo the plan administrator's decision to deny benefits. Such review requires the Court to evaluate the record to determine if Plaintiff Brenda Glover is disabled under the terms of the Plan, without giving deference to Jefferson Pilot's decision. See Davidson v. Prudential Ins. Co. of Am., 953 F.2d 1093, 1095 (8th Cir. 1992); Walke v. Group Long Term Disability Ins., 256 F.3d 835, 839-840 (8th Cir. 2001).

Under a de novo standard of review, "a district court has more discretion to allow the parties to introduce evidence in addition to that submitted to the plan decision-maker." McKeenhan v. Cigan Life Ins. Co., 344 F.3d 789, 793 (8th Cir. 2003). The Court may also "make findings of fact after a bench trial or on a stipulated fact record, rather than conducting the summary judgment review that is customary when applying the abuse-of-discretion standard." Id., at 793.

IV. Material Facts

The car accident giving rise to Plaintiff's injuries occurred on May 9, 2004, in a mall parking lot, when a woman backed into the right front panel of Plaintiff's car. (AR 0063, 0086). Plaintiff saw the woman backing up, honked her horn and applied her brakes, but was unable to avoid contact. Plaintiff reported that she was wearing her seatbelt at the time. (AR 0086).

Plaintiff did not seek medical treatment on the day of the accident. However, Plaintiff sought treatment at a hospital emergency room on the following two days. The hospital records are not a part of the Administrative Record.

Plaintiff saw Dr. Gary Nunn on May 13, 2004. (AR 0067). Plaintiff reported to Dr. Nunn that since the parking lot accident five days earlier she had experienced "constant neck pain, mid back pain, low back pain, and intermittent headaches as well as intermittent right leg pain" and that "it generally hurts to move all over." (AR 0067). Dr. Nunn recommended moist heat, ultrasound, and massage for Plaintiff's back and prescribed Amitriptyline, Ibuprofen and Soma. (AR 0069). Dr. Nunn recommended that Plaintiff rest at home until he could re-evaluate her. Id.

Plaintiff saw Dr. Nunn for the second time on June 3, 2004. At that time, Plaintiff reported that her headaches had improved, but she continued to have pain in the neck, upper back, and right leg. Dr. Nunn noted on physical examination that the Plaintiff was limping. Dr. Nunn advised Plaintiff to continue physical therapy and to return for reevaluation in three weeks. (AR 0072).

Plaintiff applied for short-term disability benefits on June 8, 2004. (AR 0101). Dr. Nunn filled out the Attending Physician's statement that accompanied the application. Therein, Dr. Nunn listed a diagnosis of "cervical and thoracolumbar sprain." (AR 0103). The "subjective symptoms" Dr. Nunn reported were "muscle pain." Under "objective findings" Dr. Nunn wrote "limited range of motion." Id. Dr. Nunn placed the following restrictions on Plaintiff: "no strenuous activities, overhead lifting, bending, prolonged sitting or standing." Id. Dr. Nunn estimated Plaintiff would be able to return to work in two to four weeks. Id. Jefferson Pilot awarded Plaintiff short-term disability benefits as of May 19, 2004. (AR 0462).

On June 24, 2005, Plaintiff saw Dr. Nunn for a follow-up appointment. Dr. Nunn noted that Plaintiff's headache, neck pain, and right hip contusion had "resolved" but that she continued to have low back pain and discomfort. Dr. Nunn recommended that Plaintiff continue with physical therapy and return in three weeks for "reevaluation." (AR 0075).

By letter dated July 7, 2005, Jefferson Pilot notified Plaintiff that it was extending her short-term benefits until July 15, 2004, but that additional medical documentation would be required to extend her benefits beyond that date. (AR 00403).

Plaintiff saw Dr. Nunn on July 15, 2004. She complained of "daily discomfort" and reported "very little improvement." At this time, Plaintiff had undergone approximately nine weeks of therapy. Dr. Nunn's impressions were cervical neck sprain, unchanged; posttraumatic headaches, unchanged; thoracolumbar spine sprain, unchanged; and right hip contusion, unchanged. Physical therapy was discontinued. (AR 0077).

Plaintiff next saw Dr. Nunn on August 5, 2004. She reported her pain had improved, but that she continued to have daily soreness and discomfort. Dr. Nunn recommended that she ...

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