United States District Court, Eastern District of Pennsylvania
Juan R. Sanchez, J.
Plaintiff Wanda Connelly brings claims for long-term disability benefits under Section 502(a)(1)(B) of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132(a)(1)(B). She alleges Defendant Reliance Standard Life Insurance Company (Reliance) wrongly denied disability benefits that she was entitled to receive under the long-term disability plan sponsored by her employer, Fulton Financial Corporation. Because the Court finds Reliance’s decision to terminate Connelly’s benefits was arbitrary and capricious, the Court will grant Connelly’s summary judgment motion and deny Reliance’s summary judgment motion.
Connelly worked for Fulton Financial Corporation as a scanning and indexing specialist. As an employee benefit, Fulton sponsored a long term disability plan (the Plan) and purchased a life insurance policy from Reliance to fund the plan and pay benefits under it (the Policy). The Policy provided a monthly benefit to participants if they are totally disabled, meaning “that as a result of Injury or Sickness . . . an Insured cannot perform the material duties of his/her Regular Occupation.” Policy 2.1; Administrative Record at 10 (hereinafter A.R.).
The Position Description submitted by Fulton states the scanning and indexing specialist position requires “preparation, scanning and indexing of all loan packets associated with all Customer Mortgage and Commercial Loan serviced by the Loan Operations Department.” A.R. at 208. Essential duties include preparation of loan packets for scanning, scanning loan packets, indexing scanned batches using specific software, preparing loan packets for permanent retention, assisting in training of applicable Fulton personnel on imaging procedures, proving assistance to affiliate banks, coordinating a back-filing project of current inventory of 85, 000 loans, working with other departments to provide immediate back-file solutions as loans are requested, distributing reports for loan applications, and mailing loan statements. A.R. at 208-09. Fulton describes the work environment as “occasionally hectic with occasional high stress.” A.R. at 210. In her application for long term benefits, Connelly described her job as scanning and indexing documents, filing, looking for documents, answering the phone, completing file room requests, mailing payments, making mortgage files, and checking mortgage loans. A.R. at 192.
On November 21, 2011, Connelly ingested a large quantity of oxycodone and Xanax. She was hospitalized and diagnosed with depression, panic disorder, and agoraphobia (extreme or irrational fear of crowded spaces or enclosed public places). Following this incident, she suffered from panic attacks, anxiety, depression, paranoia, and an inability to perform activities of daily living. Reliance approved her claim for disability benefits on June 28, 2012, based on a review of her medical records by an in-house medical personnel, Nurse C. Ricci, and paid Connelly disability benefits totaling $1, 435.09 per month from May 19, 2012, until November 19, 2012.
On November 1, 2012, a registered nurse, Nurse Patricia Toth, reviewed Connelly’s medical records on Reliance’s behalf and determined Connelly no longer suffered from a psychiatric impairment. In forming her opinion, Nurse Toth relied solely on medical records and did not physically examine Connelly. On November 8, 2012, Reliance terminated Connelly’s claim for disability benefits.
Connelly appealed the termination decision on March 27, 2013, and submitted additional medical records to Reliance. Reliance denied her appeal on July 2, 2013, basing its decision on a peer review of the medical records conducted by a board certified psychiatrist, Dr. Michael A. Rater, who concluded, also without a physical exam of Connelly, that Connelly could have returned to work as of November 2012. After exhausting her administrative remedies, Connelly filed a Complaint in the Court of Common Pleas of Lancaster County, Pennsylvania on August 27, 2013, alleging Reliance’s decision to terminate her benefits was arbitrary and capricious and in violation of her right to receive benefits under ERISA. Reliance removed the case to this Court on October 9, 2013.
During the time period before and after her November 2011, hospitalization, Connelly was being treating by her personal physician, Dr. Julie Jones. The administrative record contains encounter notes from Dr. Jones beginning in September 2011, when Connelly visited Dr. Jones for injuries she suffered in a car accident. After Connelly’s hospitalization, Dr. Jones also treated Connelly for anxiety, depression, and insomnia. On April 12, 2012, Dr. Jones noted that while Connelly has improved somewhat, there were still significant stressors at home. A.R. at 284. Dr. Jones reported Connelly was “still feeling somewhat fragile, ” but also that she was “more animated than initially.” A.R. 284-85. On May 16, 2012, Dr. Jones noted Connelly “got tearful” when discussing the multiple stressors in her life, and it was her opinion Connelly was not ready to return to work. A.R. 287-89. In September 2012, Dr. Jones wrote although Connelly had been due for an appointment in July, her COBRA benefits had not started so she could not return until September. A.R. at 354. She described Connelly’s mood as “stable, ” and discussed some of the coping mechanisms Connelly performed when she got anxious. Id. Dr. Jones also stated “Wanda’s depression seems improved and stable. Her work stressors are removed . . . . She is still a bit fragile with stress at home, but is coping much better than last year.” A.R. at 355. However, according to Dr. Jones, Connelly began to decline after the September 2012, visit. Dr. Jones stated in the encounter notes for January 2013, that since November 2012, Connelly’s symptoms of major depression had returned. A.R. at 372. Dr. Jones described Connelly as “very fatigued . . . stressed and anxious, she cannot do more than one thing at a time.” Id. Dr. Jones noted, “Wanda’s depression is significantly worse since our last visit.” A.R. at 373, and “[s]he can answer questions logically and coherently, but she does seem a bit withdrawn.” A.R. at 372. She concluded “[i]t is clear to me she is unable to work at this point.” A.R. at 373.
In a March 2013 letter,  Dr. Jones stated in the fall of 2011, Connelly “was not functioning and was exhibiting vegetative symptoms including decreased concentration, lack of interest in activities, feelings of sadness and hopelessness, and insomnia.” A.R. at 371. Dr. Jones explained that Connelly’s depression gradually improved over the following year, but “[i]n November of 2012 she experienced another major depressive episode, ” and that since November 2011, “it is highly unlikely that she could function in any job capacity, ” because “[s]he remains depressed, anxious, and unable to concentrate.” Id.
Connelly also began seeing a therapist, Joni Brandt, in January 2012, two months after her hospitalization, but stopped attending sessions from May until September 2012, because she did not have medical coverage. Connelly resumed therapy sessions with Ms. Brandt in September 2012, two months before Reliance terminated her benefits. On September 6, 2012, Ms. Brandt reported in her chart notes that Connelly’s medications had not changed since their last meeting in May 2012, but Connelly was still easily overwhelmed and was experiencing high anxiety and difficulty focusing and multitasking. A.R. at 384. On October 4, 2012, Ms. Brandt noted that although Connelly was still experiencing high anxiety and was easily overwhelmed, she “[r]eports good self care, pacing self, getting healthier.” A.R. at 384. On November 20, 2012, around the time period Dr. Jones claims Connelly suffered a second depressive episode, Ms. Brandt noted Connelly reported her “mood has been vacillating” and she “continues to get overwhelmed easily.” A.R. at 386. Ms. Brandt described Connelly as “tearful throughout session, engaged, good eye contact.” Id. She also wrote that Connelly was going to talk with Dr. Jones about changing her medication. Id. On December 13, 2012, Ms. Brandt described Connelly as “tearful” and noted she reported feeling “foggy—like she is swimming.” A.R. at 386. On January 3, 2013, Ms. Brandt wrote a letter stating that Connelly “continues to experience significant emotional distress, difficulty with concentration and multi-tasking. She reportedly experiences panic attacks of moderate intensity several times a week.” A.R. at 360. Ms. Brandt did not, however, state in this letter that Connelly was “disabled” or unable to work as of November 2012.
A motion for summary judgment will only be granted if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). A factual dispute is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citation and internal quotation marks omitted). In determining whether to grant summary judgment, the court “must view the facts in the light most favorable to the non-moving party, and must make all reasonable inferences in that party’s favor.” Hugh v. Butler Cnty. Family YMCA, 418 F.3d 265, 267 (3d Cir. 2005). The court applies the same standard when deciding cross-motions for summary judgment as the standard applied when only one party has filed a summary judgment motion. See Selected Risks Ins. Co. v. Schwabenbauer, 540 F.Supp. 22, 24 (E.D. Pa. 1982).
The standard of review of Reliance’s decision to terminate Connelly’s benefits is arbitrary and capricious, also known as a deferential abuse of discretion standard. An administrator’s decision is arbitrary and capricious only “if it is without reason, unsupported by substantial evidence or erroneous as a matter of law.” Abnathya v. Hoffmann–La Roche, Inc., 2 F.3d 40, 45 (3d Cir. 1993) (citations and internal quotation marks omitted). “When it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that outcome is not arbitrary or capricious.” Hunter v. Caliber Sys., Inc., 220 F.3d 702, 710 (6th Cir. 2000) (citation omitted). Although the arbitrary and capricious standard is highly deferential, the court must still consider the quality and quantity of the medical evidence and the opinions on both sides of the issues, so as to avoid rendering courts “nothing more than rubber stamps for any plan administrator’s decision.” Glenn v. MetLife, 461 F.3d 660, 674 (6th Cir. 2006), aff’d sub nom. Metro. Life Ins. Co. v. Glenn, 554 U.S. 105 (2008) (citation omitted); see also Foley v. Int’l Bhd. of Elec. Workers Local Union 98 Pension Fund, 91 F.Supp.2d 797, 805 (E.D. Pa. 2000). However, the court is limited to the evidence before the administrator at the time he reviewed and decided the claim. Mitchell v. Eastman Kodak Co., 113 F.3d 433, ...