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Kovach v. Unum life Ins. Co. of America

December 30, 2009


The opinion of the court was delivered by: Eduardo C. Robreno, J.


Plaintiff Aria Kovach ("Plaintiff") brings this ERISA action seeking payment of long-term disability benefits, retroactive to May 28, 2008, by Defendant Unum Life Insurance Company of America ("Unum").*fn1 Before the Court are cross-motions for summary judgment. For the reasons that follow, Defendant's motion for summary judgment (doc. no. 9) will be granted and Plaintiff's motion for summary judgment (doc. no. 12) will be denied.


On Dec. 12, 1997, while she was a McDonald's employee, Plaintiff suffered several herniated discs in her lower back while pulling heavy trash bags. She had ongoing pain in her back and left leg, and began receiving workers' compensation benefits. To alleviate the pain, Plaintiff underwent a discectomy surgery in 1999. The surgery was initially successful, and Plaintiff was able to begin work as a bank teller with First Financial Bank ("First Financial") in 1999. In 2002, she was promoted to a staff accountant position at First Financial.

While working for First Financial, Plaintiff's conditioned steadily worsened. She was forced to undergo a second discectomy surgery on Aug. 12, 2005. Plaintiff suffered complications during the surgery, requiring a second surgery on Aug. 23, 2005. At all times during Plaintiff's employment with First Financial, the bank maintained a group insurance policy (the "Plan") for the benefit of its employees. Unum was the policy provider at all relevant times.

Plaintiff applied for and was granted short term disability benefits by Unum from Aug. 12, 2005, until Nov. 10, 2005.*fn2 On November 11, 2005, Plaintiff began receiving long term, total disability benefits. These benefits were paid both from First Financial's group policy and from her individual policy, for which she paid a premium.*fn3 Plaintiff continued to receive long-term disability benefits until April 30, 2008 when, citing the report of an independent medical exam performed by Dr. Gregory Anderson, Unum terminated Plaintiff's long-term total disability payments.*fn4

Based on Dr. Anderson' report, and the reports of other medical and vocational experts, Unum determined that Plaintiff no longer fell within the Plan's definition of "total disability." (Def.'s Mot. for Summ. J. Ex. 79, doc. no. 9.) Specifically, Unum found that Plaintiff was "able to work in her sedentary occupation on at least a part-time bases but refused to do so." (Id. at 16.) Unum relied Dr. Anderson's report which opined that Plaintiff could return to work as long as she underwent physical therapy and was weaned back into a 40 hour work week. (Pl.'s Cross Mot. for Summ. J. 9-10, doc. no. 12).

On May 12, 2008, Plaintiff appealed Unum's decision. In support of her appeal, Plaintiff submitted a medical evaluation from her attending physician, Dr. Kenan Aksu, which stated, "I recommend that [Plaintiff] not attempt going back to work even on a limited basis because of the possibility of worsening her condition." (Def.'s Mot. for Summ. J. Ex. 88, doc. no. 9.) Unum referred Plaintiff's claim file to Dr. Isadore G. Yablon, a medical consultant who is board certified in orthopedic surgery for a review. Dr. Yablon issued a report which states that "I would agree with Dr. Anderson that she could return to her usual occupation as an accountant provided she not lift more than 10 pounds." (Def.'s Mot. for Summ. J. Ex. 90, doc. no. 9.) It further states that Plaintiff could be taught the necessary structured physical therapy and she could do these exercises on her own at home.*fn5 (Id.)

On July 23, 2008, Unum denied Plaintiff's appeal. (Id. Ex. 92.) On Sept. 13, 2008, Dr. Aksu examined Plaintiff again and concluded that she could return to work with some restrictions, including not sitting for longer than thirty minutes in a row and not lifting more than ten pounds. On Sept. 22, 2008, Plaintiff began working a part-time front desk position with her podiatrist, Dr. Craig McHugh.

This lawsuit followed Unum's denial of Plaintiff's appeal. Plaintiff seeks payment of total disability benefits from May 28, 2008 until Sept. 21, 2008 and residual disability benefits from Sept. 22, 2008 through the present, plus interest. (Pl.' Compl. ¶ 29.)


A. Motion for Summary Judgment under Fed. R. Civ. P. 56

A court may grant summary judgment when "the pleadings, the discovery and the disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(C). A fact is "material" if its existence or non-existence would affect the outcome of the suit under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). An issue of fact is "genuine" when there is sufficient evidence from which a reasonable jury could find in favor of the non-moving party regarding the existence of that fact. Id. at 248-49. "In considering the evidence, the court should draw all reasonable inferences against the moving party." El v. Se. Pa. Transp. Auth., 479 F.3d 232, 238 (3d Cir. 2007). However, while the moving party bears the initial burden of showing the absence of a genuine issue of material fact, the non-moving party "may not rely merely on allegations or denials in its own pleading; rather its response must - by affidavits or as otherwise provided in [Rule 56] - set out specific facts showing a genuine issue for trial." Fed. R. Civ. P. 56(e)(2).

These rules apply with equal force to cross-motions for summary judgment. See Lawrence v. City of Phila., 527 F.3d 299, 310 (3d Cir. 2008). When confronted with cross-motions for summary judgment, as in this case, the Court considers each motion separately. See Coolspring Stone Supply, Inc. v. Am. States Life Ins. Co., 10 F.3d 144, 150 (3d Cir. 1993) (noting that concessions made for purposes of one party's summary judgment motion do not carry over into the court's separate consideration of opposing party's motion).

B. ERISA Standard of Review

A denial of a claim for benefits brought pursuant to ERISA is governed by a de novo standard of review, "unless the benefit 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 (1989). Where a plan administrator is granted such discretion, the Court must review the administrator's denial of a claim for benefits using an arbitrary and capricious standard of review. See id. at 111 (noting that where a plan administrator is given discretionary authority "[t]rust principles make a deferential standard of review appropriate").

"Under the arbitrary and capricious (or abuse of discretion) standard of review, the district court may overturn a decision of the Plan administrator only if it is 'without reason, unsupported by substantial evidence or erroneous as a matter of law.'" Abnathya v. Hoffman-La Roche, Inc., 2 F.3d 40, 45 (3d Cir. 1993) (quoting Adamo v. Anchor Hocking Corp., 720 F. Supp. 491, 500 (W.D. Pa. 1989)); see also Ellis v. Hartford Life and Accident Ins. Co., 594 F. Supp. 2d 564, 566 (E.D. Pa. 2009) (noting that a court applying an arbitrary and capricious standard of review is "not free to substitute its judgment for that of the administrator"); Fabyanic v. Hartford Life and Accident Ins. Co., No. 08-400, 2009 WL 775404, at *5 (W.D. Pa. Mar. 18, 2009) (noting that the phrases "abuse of discretion" and "arbitrary and capricious" are interchangeable and that both are "understood to require a reviewing court to affirm the Administrator unless an underlying interpretation or benefit determination was unreasonable, irrational, or contrary to the language of the plan").

Until recently, courts in the Third Circuit applied the arbitrary and capricious standard of review "using a 'sliding scale' in which the level of deference . . . accorded to a plan administrator would change depending on the conflict or conflicts of interest affecting plan administration." Estate of Schwing v. The Lilly Health Plan, 562 F.3d 522, 525 (3d Cir. 2009); see also Pinto v. Reliance Standard Life Ins. Co., 214 F.3d 377, 387, 392 (3d Cir. 2000) (discussing "heightened" arbitrary and capricious standard of review). However, following the Supreme Court's decision in Metropolitan Life Ins. Co. v. Glenn, this type of enhanced arbitrary and capricious review is no longer appropriate. 554 U.S. ___, 128 S.Ct. 2343, 2350 (2008) (finding that "a conflict should be weighed as a factor in determining whether there is an abuse of discretion" (internal quotations omitted)); see also Schwing, 562 F.3d at 525 ("Accordingly, we find that, in light of Glenn, our "sliding scale" approach is no longer valid. Instead, courts reviewing the decisions of ERISA plan administrators or fiduciaries in civil enforcement actions brought pursuant to 29 U.S.C. § 1132(a)(1)(B) should apply a deferential abuse of discretion standard of review across the board and consider any conflict of interest as one of several factors in considering whether the administrator or the fiduciary abused its discretion"); Ellis, 594 F. Supp. 2d at 566 ("Glenn makes clear that there is no heightened arbitrary and capricious standard of review"); Farina v. Temple Univ. Health Sys. Long Term Disability Plan, No. 08-2473, 2009 WL 1172705, at *9 (E.D. Pa. Apr. 28, 2009) (noting that post-Glenn, "there are only two possible standards of review that could apply . . . arbitrary and capricious or de novo).*fn6

Thus, in reviewing Plaintiff's instant ERISA claim, the Court will apply a deferential arbitrary and capricious standard of review. In so doing, the Court will "'take account of several different considerations of which a conflict of interest is one,' and reach a result by weighing all of those considerations." Schwing, 562 F.3d at 526 (quoting Glenn, 128 S.Ct. at 2351); see also Post v. Hartford Ins. Co., 501 F.3d 154, 162 (3d Cir. 2007) (noting that a court performing this inquiry must consider "both structural and procedural factors" and that "[t]he structural inquiry focuses on the financial ...

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