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Taylor v. SBC Communications

May 25, 2007


The opinion of the court was delivered by: J. Leon Holmes United States District Judge


Joey Taylor filed this complaint pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq., alleging that his long-term disability (LTD) benefits were wrongfully terminated and that defendants breached their fiduciary duties under ERISA. The parties have filed cross motions for summary judgment. For the reasons stated hereinafter, the defendants' motion is granted, and the plaintiff's motion is denied.


SBC provides eligible participants short-term disability (STD) benefits and LTD benefits through the SBC Disability Income Plan (the "Plan"). The Plan defines STD as the inability of an employee "to perform all the essential functions of his job or another available job assigned by" his employer for a period lasting 52 weeks or less. (AR 602-603) LTD is defined as the period following the 52 weeks of STD where an employee is "prevented from engaging in any employment for which the Employee is qualified or may reasonably become qualified based on education, training, or experience . . . ." Id. The Plan states, "Employees shall provide the Claims Administrator, the Plan Administrator, and/or the Participating Company with such information and evidence, and shall sign such documents, as reasonably may be requested from time to time, for the purpose of Administration of the Plan." (AR 616) The Plan provides for appeals as follows:

If your claim is denied or treated as denied, and you disagree with the decision, you may appeal the decision by filing a written request for review. You or someone authorized by you must make the request for review within 180 days of receipt of the denial notice or, if no notice is received, 180 days after the expiration of 45, 75 or 105 days, whichever is applicable. A written request for review should be sent directly to the appropriate named fiduciary as provided in your denial letter or, if you received no denial letter, to: SBC Services, Inc. Disability Plan c/o Executive Director -- Workforce Effectiveness P.O. Box 29690 San Antonio, TX 78229 (AR 1074) CORE, INC., served as the Claims Administrator under the Plan until March 25, 2002, at which time Sedgwick CMS became the Claims Administrator. (AR 925-1071) SMAART is the acronym for the SBC Medical Absence and Accommodations Resource Team that is administered by Sedgwick CMS for the purpose of making claim decisions. (AR 1071)


Taylor was employed by SBC Communications, Inc., as a Senior Manager. (AR 539) In April 2001, he was diagnosed with symptomatic HIV disease and depression with anxiety. (AR 132) He applied for STD benefits and signed an authorization for release of medical information on April 18, 2001. (AR 286) On May 2, 2001, CORE sent Taylor a letter denying Taylor STD benefits as of April 19, 2001. (AR 285) CORE stated that it had not obtained sufficient medical information about Taylor's condition from his medical provider's office. On May 3, 2001, Dr. Thomas C. Stinnett, a psychiatrist, provided CORE an attending provider statement indicating that Taylor had a diagnosis of major depression, recurrent. He noted that Taylor had "low energy, poor concentration, feelings of helplessness and hopelessness, inability to interact effectively with others." He prescribed a number of medications, including Prozac and Lorazepam. (AR 572-573) On May 24, 2001, Terry Jefferson, M.D., Taylor's treating physician at Health for Life Clinic, diagnosed Taylor with acute/asymptomatic HIV and depression NEC. He noted that Taylor reported "lots of fatigue." (AR 130) Taylor was approved for STD benefits for the period of April 19, 2001 through August 19, 2001. (AR 304-307) Taylor's STD benefits were terminated when he went to work for a brief period of time. (AR 304)

In January, 2002, Taylor suffered a relapse in his condition and again began receiving STD benefits, beginning February 1, 2002, and continuing until September 30, 2002, when he began receiving LTD benefits. (AR 023, 335-336) During the 52 weeks that Taylor received STD benefits, he was given notice of intent to terminate benefits on a number of occasions. For example, on February 20, 2002, CORE sent Taylor a letter stating that his benefits were denied as of February 1, 2002, because CORE did not receive sufficient medical information about Taylor's condition from his provider. (AR 280) CORE obtained information from Dr. Jefferson and on March 29, 2002, approved Taylor for STD benefits from February 1, 2002 through April 5, 2002. (AR 023, 276)

On April 8, 2002, SMAART notified Taylor that he needed to provide medical documentation within five days or his benefit payments would cease as of April 5, 2002. (AR 271) On April 15, 2002, SMAART advised Taylor that his benefits were discontinued from April 6, 2002 through his return to work date because the medical documentation from Dr. Jefferson only confirmed Taylor's disability through April 5th and no additional information had been received.

(AR 270) Dr. Jefferson's office sent updated information on May 1st. (AR 019, 575) The records from March 22, 2002, and April 9, 2002, indicated that Taylor had a primary diagnosis of Symptomatic HIV Disease and a secondary diagnosis of Depression NEC. (AR 576-584) On May 10, 2005, SMAART reviewed the medical information, noting that Taylor was HIV positive and suffers from depression and fatigue. (AR 018) On May 15, 2002, the case manager also spoke by telephone with Dr. Jefferson, who stated that Taylor's level of fatigue was currently severe enough to keep him from even sedentary work. (AR 015) On May 16, 2002, SMAART approved Taylor for benefits through May 25, 2002. (AR 246) Taylor was subsequently approved, on May 17, 2002, to receive benefits through June 22, 2002. (AR 244)

On June 27, 2002, SMAART sent Taylor a letter notifying him that his disability benefits would be discontinued from June 23, 2002, because no additional information had been received to support continued disability benefits beyond June 22nd. (AR 238) Dr. Jefferson provided documentation on July 11, 2002, which included a June 24th progress note and lab results.

By letter dated July 29, 2002, SMAART again notified Taylor that his benefits would be discontinued effective June 23, 2002. It noted that the SMAART psychiatric physician reviewed the medical information and concluded that it did not support the presence of a severe mental impairment related to Taylor's diagnosis of depression. SMAART concluded that the clinical information did not show that Taylor's condition was so severe as to support his inability to perform his occupation as a Senior Manager from June 23, 2002, through his return to work. (AR 232) Dr. Jefferson sent additional information to SMAART that was reviewed on August 1, 2002. The denial of benefits was reversed on August 6, 2002, and he was approved for STD through September 29, 2002. (AR 0002-0004)

On August 13, 2002, SMAART set up an LTD claim for Taylor and sent him a letter advising him that he needed to apply for LTD benefits as his STD benefits would be expiring. (AR 592-594) Between August 22, 2002, and September 25, 2002, a SMAART case manager placed seven telephone calls to Taylor requesting that he call, sent two letters to Taylor requesting that he call, and sent two LTD packages to Taylor with letters advising him that the LTD application had to be returned before he could be considered for LTD benefits. (AR 333-342)

By letter dated September 20, 2002, SMAART notified Taylor that he had been approved for LTD benefits at the rate of $3,106.80 per month. The letter advised Taylor that he needed to return the LTD paperwork sent him on August 13, 2002, in order to receive payments. (AR 543)

On September 25, 2002, Taylor telephoned the SMAART case manager. According to the case manager's notes, Taylor stated he had received the LTD paperwork and letters "but had shut himself off from the rest of the world and would not reply to anyone about his status." (AR 332) He also stated "that his condition is unpredictable and on any given day he can be so fatigued that he could be stuck in bed and unable to do anything. He reported that occasionally he will be stuck in bed for a couple weeks at a time." (AR 333)

On September 30, 2002, SMAART notified Taylor that his LTD benefits had been adjusted to the rate of $9,708.92 per month. (AR 540) On October 7, 2002, SMAART sent a confirmation that Taylor's application for LTD benefits had been received and that he would be contacted soon by an LTD case manager. (AR 536) Taylor was notified by letter dated December 19, 2002, that his benefits would ...

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