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Music v. Prudential Insurance Company of America

March 7, 2007

DEBRA S. MUSIC, PLAINTIFF
v.
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA AND PENN NATIONAL INSURANCE, DEFENDANTS



The opinion of the court was delivered by: Christopher C. Conner United States District Judge

MEMORANDUM

Presently before the court are cross motions for summary judgment (Docs. 21, 25, 28) with respect to the claim of plaintiff, Debra S. Music ("Music"), to recover long-term disability benefits and reimbursement of payments for life insurance and health and dental insurance that are allegedly owed to her by defendants Prudential Insurance Company of America ("Prudential") and Penn National Insurance ("Penn National").*fn1 This cause of action is governed by the Employee Retirement Income Security Act ("ERISA").*fn2 See 29 U.S.C. §§ 1001-1401.

I. Facts*fn3

Plaintiff was employed by Penn National as a customer service representative. In June of 2002, she ceased working in that capacity and began to receive benefits under the Penn National salary continuation program. Plaintiff applied to Prudential for long-term disability benefits and was granted a closed period of benefits from December 20, 2002 through August 31, 2003. Prudential denied plaintiff's claim for long-term disability benefits beyond this closed period and has not provided plaintiff with benefits since August 31, 2003. (Doc. 29.)

Plaintiff asserts that she has chronic active rheumatoid arthritis and that she is unable to work. (Doc. 1.) She further alleges that Prudential arbitrarily and capriciously terminated her disability benefits. (Doc. 31.) In her complaint (Doc. 1), plaintiff seeks an order directing defendants to pay long-term disability benefits to her effective September 1, 2003, to reimburse the life insurance payments and health and dental insurance payments that she has made subsequent to the termination of her disability benefits, and to reinstate her life, health, and dental insurance. She also seeks interest, costs, and attorneys' fees. (Id.)

On May 12, 2006, the magistrate judge filed a report recommending that the plaintiff's motion for summary judgment (Doc. 28) be granted in part and denied in part. (See Doc. 40.) The magistrate judge also recommended that defendants' motions for summary judgment (Docs. 21, 25) be denied. Defendants filed objections (Docs. 41-44) to the report and recommendation, to which the plaintiff filed responses (Docs. 45, 46). After an independent review of the record,*fn4 the court will adopt in part and reject in part the magistrate judge's report and recommendation.

II. Discussion

A. Penn National's Motion for Summary Judgment

In the matter sub judice, the magistrate judge recommended the denial of defendant Penn National's motion for summary judgment without discussion. (See Doc. 40.) Penn National claims that it is not a proper defendant in this action because it is not a fiduciary under ERISA*fn5 or, alternatively, that the plaintiff has failed to offer evidence supporting her claim that Penn National breached any fiduciary duty owed to the plaintiff. (Doc. 25 at 2.) By order of court dated April 19, 2006, this court denied Penn National's motion to dismiss (Doc. 5) on the same grounds in order to "permit the plaintiff to develop the record to demonstrate Penn National's discretion and role in the denial of benefits." (Doc. 39.)

Plaintiff contends that Penn National is a proper and necessary party to this action because it is listed as the plan sponsor and plan administrator in the summary of the long-term benefits plan. (See Doc. 1, Ex. A at 32.) However, plaintiff does not refute the clear language of the plan that indicates that Prudential has the sole discretion in determining eligibility for benefits under the plan. (See Doc. 1, Ex. A at 33.) Nor does plaintiff offer any evidence that Penn National had, or exercised, any discretion with respect to benefits under the long-term disability plan. See Tywalk v. Prudential Ins. Co., No. CIVA 2004-222J, 2006 WL 2815806, at *4 (W.D. Pa. Sept. 28, 2006) (finding that an employer was not a fiduciary under ERISA because it "retained no discretionary authority, responsibility or control with respect to the benefits sought by [the plaintiff]"); see also Earnest v. Metro. Life Ins. Co., 291 F. Supp. 2d 1327, 1338 (M.D. Fla. 2003) (finding that the employer listed as the plan sponsor and plan administrator was not a proper defendant because the employer had "delegated full discretionary authority to [the insurer] . . . to determine all claims and appeals for [long-term disability] benefits"). Accordingly, a reasonable trier of fact could not conclude that Penn National is a fiduciary. The court will sustain defendant Penn National's objection and reject the report and recommendation with respect to this issue.

B. Plaintiff's Motion for Summary Judgment

The magistrate judge, finding that defendant Prudential arbitrarily and capriciously denied plaintiff's application for long-term disability benefits, recommended that plaintiff's motion for summary judgment (Doc. 28) be granted as to that claim. (See Doc. 40.) The court agrees with the magistrate judge on this issue and finds that Prudential arbitrarily and capriciously denied plaintiff's application for long-term disability benefits by: (1) insisting upon objective medical evidence of a disability, and (2) relying on the opinion of a non-treating physician who failed to consider the possibility that plaintiff had a disability that simply was not supported by objective medical evidence.*fn6 See Mitchell v. Eastern Kodak Co., 113 F.3d 433, 440-42 (3d Cir. 1997) (finding that the plaintiff's chronic fatigue syndrome rendered him totally disabled despite a lack of objective evidence); see also Ott v. Litton Industries, Inc., No. 4:04-CV-763, 2005 WL 1215958, at *17 (M.D. Pa. May 20, 2005) ("Although the Supreme Court has held that courts may not require ERISA plan administrators to defer to doctors who have treated a claimant over those who merely review her medical files, the court may still evaluate the weight of each doctor's opinion on the extent of his or her treatment history with the patient and specialization or lack thereof.") (citing Black & Decker Disability Plan v. Nord, 538 U.S. 822, 832, 834 (2003)). The court will order defendant Prudential to restore plaintiff's disability benefits and pay such benefits under the plan effective from the date of cancellation of benefit payments in September 2003. These benefits, including those received from December 2002 through August 2003, are to run for twenty-four months, at which time Prudential may consider whether to terminate benefits in the future consistent with the provisions of the long-term disability plan.

The magistrate judge also recommended that the plaintiff's motion for summary judgment as to the claim for reimbursement of losses of life, health, and dental insurance benefits be denied. (See Doc. 40.) The magistrate judge assumed, arguendo, that the disability benefits plan (Doc. 1, Ex. A) was part of a more comprehensive ERISA plan and that further development of the record was required. The court does not agree with the magistrate judge's conclusion and instead finds that the plaintiff has not offered any evidence of a benefits plan entitling her to reimbursement for life insurance or health and dental insurance expenses or for reinstatement of such benefits. See DiFelice v. Aetna U.S. Healthcare, 346 F.3d 442, 457-58 (3d Cir. 2003) ("[ERISA] § 502(a)(1)(B), by its plain language only allows plan participants to seek the benefits to which they are contractually entitled . . . ."); Santasania v. Union Travel Trades Benefit Funds, No. 3:01-CV-1442, 2003 WL 256778, at *3 (M.D. Pa. Feb. 4, 2003) ("Section 502(a)(1)(B) does not authorize Plaintiff's claim for reimbursement of COBRA expenses. Courts have strictly construed the language in § 502(a)(1)(B), limiting recovery to benefits due under the terms of the plan.") (citing Mass. Mutual Life Ins. Co. v. Russell, 473 U.S. 134, 144 (1985)). Although the complaint refers to an "Employee Welfare Benefit Plan" (Doc. 1 ΒΆ 3), the record is devoid of any plan other than the long-term disability plan attached to the complaint. This long-term disability plan does not entitle plaintiff to reimbursement of life insurance or health and dental insurance expenses or reinstatement of such benefits. (See Doc. 1, Ex. A.) In addition, with respect to Prudential, the long-term disability plan states, in pertinent part, that "Prudential plays no role in ...


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