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Garrett v. Hartford Life and Accident Insurance Co.

November 8, 2007

CARROLL GARRETT PLAINTIFF
v.
THE HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY DEFENDANT



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

OPINION AND ORDER

Carroll Garrett commenced this action pursuant to section 502(a) of ERISA to recover long-term disability benefits allegedly due him under a plan sponsored by his former employer, FedEx Freight East, Inc. The administrative record has been filed, and both parties have submitted briefs, so this case is ripe for decision. For the reasons stated hereinafter, the Court remands Garrett's claim for long-term disability benefits to The Hartford Life and Accident Insurance Company for a determination of eligibility.

I.

Carroll Garrett is a sixty-two-year-old man with a high school education. He worked as a diesel mechanic for FedEx Freight East from February 16, 1998, until January 22, 2004, when he became unable to work due to a frozen right shoulder. He then applied for disability benefits under the ERISA plan sponsored by FedEx Freight East. Garrett had been a diesel mechanic since 1965 and had had no other occupation as an adult.

A. THE TERMS OF THE PLAN

FedEx Freight East provides disability benefits to employees under a long-term disability plan insured by The Hartford Life and Accident Insurance Company. The plan is an employee welfare benefits plan established pursuant to ERISA. The plan defines "disability" as follows:

Disability or Disabled means that during the Elimination Period and for the next 12 months you are prevented by:

1. accidental bodily injury;

2. sickness;

3. Mental Illness;

4. Substance Abuse; or

5. pregnancy, from performing one or more of the Essential Duties of Your Occupation, and as a result your Current Monthly Earnings are no more than 80% of your Indexed Pre-disability Earnings.

After that, you must be so prevented from performing one or more of the Essential Duties of Any Occupation. (Adm. R. 18.) Thus, a plan participant is initially disabled if he is unable to perform one or more of the essential duties of his occupation, but after the Elimination Period plus twelve months, a plan participant must be "prevented from performing one or more of the Essential Duties of Any Occupation." The plan defines "Any Occupation" as follows:

Any Occupationmeans an occupation for which you are qualified by education, training or experience, and that has an earnings potential greater than an amount equal to the lesser of the product of your Indexed Pre-disability Earnings and the Benefit Percentage and the Maximum Monthly Benefit shown in the Schedule of Insurance. (Adm. R. 17.) The Elimination Period is the first 180 consecutive days of disability or the expiration of any employer sponsored short-term disability program, whichever is longer. (Adm. R. 5.) The plan gives Hartford discretion to determine eligibility for benefits and to interpret the terms of the plan. (Adm. R. 17.)

B. GARRETT'S CLAIM

As noted above, Garrett last worked on January 22, 2004. In August of that year, he filed an application for long-term disability benefits. In September of that year, Hartford approved his claim for long-term disability benefits and began making monthly benefit payments. In the letter to Garrett notifying that his claim had been approved, Hartford informed Garrett, "As of 7/23/05, disabled means you must be so prevented from performing the Essential Duties of Any Occupation." Later in September of 2004, Garrett applied for Social Security disability benefits. The record reflects that the application was approved. However, the decision of the Social Security Administration was not included in the administrative record and has not been provided to the Court.

On January 23, 2006, Hartford sent a letter to Garrett stating that he was not prevented from performing one or more of the essential duties of any occupation and therefore was no longer eligible for long-term disability benefits. (Adm. R. 56-60.) Garrett appealed that determination. (Adm. R. 55.) On March 27, 2006, Hartford wrote another letter to Garrett, again denying his claim and stating, "This is our final determination with respect to your appeal, our record is closed and no further review will be conducted with respect to this matter." (Adm. R. 43-44.) On January 29, 2007, Garrett commenced this action.

II.

Section 502(a)(1)(B) of ERISA provides that "a participant or beneficiary" may bring a civil action "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). "ERISA provides a plan beneficiary with the right to judicial review of a benefits determination." Woo v. Deluxe Corp., 144 F.3d 1157, 1160 (8th Cir. 1998) (citing 29 U.S.C. § 1132(a)(1)(B)). Although ERISA contains no standard of review, the Supreme Court has held that a reviewing court should apply a de novo standard of review unless the "plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956-57, 103 L.Ed. 2d 80 (1989). Where a plan gives the administrator such discretion, the administrator's decision is reviewed for an abuse of discretion. Woo, 144 F.3d at 1160 (citing Firestone, 489 U.S. at 115, 109 S.Ct. at 956-57).

Under the abuse-of-discretion standard, the proper inquiry is whether Hartford's decision was reasonable, that is, whether it was supported by substantial evidence. Ortlieb v. United HealthCare Choice Plans, 387 F.3d 778, 781 (8th Cir. 2004). "Substantial evidence is 'more than a scintilla but less than a preponderance.'" Smith v. Unum Life Ins. Co. of Am., 305 F.3d 789, 794 (8th Cir. 2002) (quoting Schatz v. Mut. of Omaha Ins. Co., 220 F.3d 944, 949 (8th Cir. 2000)). "'It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.'" Fletcher-Merrit v. NorAm Energy Corp., 250 F.3d 1174, 1179 (8th Cir. 2001) (quoting Consol. Edison Co. of N.Y. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938)). An administrator's decision is reasonable if a reasonable person could have reached a similar decision, given the evidence in the record, not whether the reasonable person would have reached that decision. Ferrari v. Teachers Ins. & Annuity Ass'n, 278 F.3d 801, 807 (8th Cir. 2002). Under this standard, the Court should consider only evidence that was before Hartford when the claim was denied. Farfalla v. Mut. of Omaha Ins. Co., 324 F.3d 971, 974-75 (8th Cir. 2003).

To obtain a less deferential review, a plaintiff must demonstrate "that (1) a palpable conflict of interest or a serious procedural irregularity existed, which (2) caused a serious breach of the plan administrator's fiduciary duty to her." Woo, 144 F.3d at 1160. "To satisfy the second part of this requirement, [the plaintiff must] show that the conflict or procedural irregularity has 'some connection to the substantive decision reached.'" Id. at 1161 (quoting Buttram v. Cent. States, Se. & Sw. Areas Health & Welfare Fund, 76 F.3d 896, 901 (8th Cir. 1996)). "For heightened review to apply, a beneficiary claiming procedural irregularities must show that the plan administrator, in the exercise of its power, acted dishonestly, acted from an improper motive, or failed to use judgment in reaching its decision." Neumann v. AT&T Commc'n Inc., 376 F.3d 773, 781 (8th Cir. 2004). "[T]his requirement 'presents a considerable hurdle' for plaintiffs . . . ." Torres v. Unum Life Ins. Co. of Am., 405 F.3d 670, 679 (8th Cir. 2005) (quoting Barnhart v. Unum Life Ins. Co. of Am., 179 F.3d 583, 588 n.9 (8th Cir. 1999)).

III.

Garrett's treating physician was Dr. Bruce Sanderson, an internal medicine physician. Sanderson referred Garrett to Dr. Scott Bowen, an orthopedic surgeon, for the treatment of Garrett's frozen shoulder. Bowen treated Garrett from February 2004 through August 2004. Bowen treated Garrett first with physical therapy, then with manipulation under anesthesia, followed by more physical therapy, corticosteroid injections, and arthroscopic surgery. Bowen's treatment was unsuccessful in enabling Garrett to return to his work as a diesel mechanic. After Bowen's treatment proved unsuccessful, Garrett filed his claim for long-term disability benefits.

When Hartford began to consider whether Garrett qualified for long-term disability benefits under the "Any Occupation" standard, it sent questionnaires to Sanderson and Bowen for them to check the agreement or disagreement with two different statements about Garrett's capacities, and they asked each doctor to complete a ...


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