United States District Court, E.D. Pennsylvania
EDWARD G. SMITH, J.
The Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001-1461, provides protections for employees participating in their employers’ benefits plans. Based upon her significant mental health issues, the plaintiff employee received short-term disability benefits under her employer’s short-term disability plan and, after the expiration of those benefits, long-term disability benefits under the “occupational disability” portion of the employer’s long-term disability plan. As those long-term disability benefits were about to expire, the plaintiff submitted a claim for continued long-term disability benefits because she asserted that issues with her knees, back, and neck prevented her from working in any occupation for a minimum of 25 hours per week and, as such, qualified her for a “total disability” under the long-term disability plan. The claims-paying administrator denied the plaintiff’s claim for total disability benefits because it determined that the plaintiff did not submit significant objective findings to support a total disability under the plan. After the claims-paying administrator denied the employee’s appeal of the total disability benefits denial, the employee filed the instant ERISA action against the claims-paying administrator and her employer’s long-term disability plan.
Currently before the court are the parties’ cross-motions for summary judgment on the issue of whether the denial of continued long-term disability benefits was arbitrary and capricious. As explained below, the court finds that there are no genuine issues of material fact and that the claims-paying plan administrator’s decision to deny the plaintiff’s request for continued long-term disability benefits was not without reason, unsupported by substantial evidence, or erroneous as a matter of law. Accordingly, the court will grant the motion for summary judgment filed by the plan administrator and the employer’s plan and deny the motion for summary judgment filed by the plaintiff employee.
I. PROCEDURAL HISTORY
The plaintiff, Carol Bechter, commenced this ERISA action by filing a complaint against the originally-named defendants, FedEx Corporation and Aetna Life Insurance Company (“Aetna”), on December 17, 2013. Compl., Doc. No. 1. In the complaint, the plaintiff essentially contends that the defendants acted in an arbitrary and capricious manner when they terminated her long-term disability (“LTD”) benefits. Compl. at ¶ 24. The defendants separately filed answers to the complaint on February 18, 2014. Doc. Nos. 7, 8. Apparently, the plaintiff had incorrectly identified FedEx Corporation as a defendant, so she filed an amended complaint on March 24, 2014, in which she changed one of the named defendants from FedEx Corporation to Federal Express Corporation Long Term Disability Plan (“FedEx LTD Plan”). Doc. No. 13.
The Honorable R. Barclay Surrick issued a scheduling order in this case on March 28, 2014. Doc. No. 15. On April 22, 2014, Chief Judge Petrese B. Tucker
reassigned this case to the undersigned. Doc. No. 16.
The defendants separately filed answers to the amended complaint on May 27, 2014. Doc. Nos. 19, 20. The court held an interim pretrial conference with counsel on June 17, 2014, after which the court entered an amended scheduling order. Doc. Nos. 21, 22. The defendants filed the applicable administrative record on July 23, 2014. Doc. No. 23.
The plaintiff and the defendants separately filed cross-motions for summary judgment, statements of material facts in support of their respective motions, and supporting memoranda of law on August 4, 2014. Doc. Nos. 29-32. The parties then filed responses to the motions on August 29, 2014. Doc. Nos. 33, 34. The court heard oral argument on the motions for summary judgment on January 13, 2015. Doc. No. 39. During oral argument, the court pointed out to counsel that there appeared to be a document missing from the administrative record and, as such, the court (1) granted the defendants leave to search for this document and to supplement the administrative record, and (2) permitted the parties to file supplemental briefs regarding this additional document. FedEx LTD Plan filed that missing document with the court on January 22, 2015. Doc. No. 40. The defendants and the plaintiff filed supplemental briefs on January 27, 2015, and January 30, 2015, respectively. Doc. Nos. 41, 42. With the missing document now part of the record before the court, the cross-motions for summary judgment are ripe for disposition.
A. Standards of Review
1. Summary Judgment Standard
A district court “shall grant summary judgment if the movant shows that there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Additionally, “[s]ummary judgment is appropriate when ‘the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’” Wright v. Corning, 679 F.3d 101, 103 (3d Cir. 2012) (quoting Orsatti v. New Jersey State Police, 71 F.3d 480, 482 (3d Cir. 1995)). An issue of fact 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). A fact is “material” if it “might affect the outcome of the suit under the governing law.” Id.
The party moving for summary judgment has the initial burden “of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal quotation marks omitted). Once the moving party has met this burden, the non-moving party must counter with “‘specific facts showing that there is a genuine issue for trial.’” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citation omitted); see Fed. R. Civ. P. 56(c) (stating that “[a] party asserting that a fact . . . is genuinely disputed must support the assertion by . . . citing to particular parts of materials in the record . . .; or . . . [by] showing that the materials cited do not establish the absence . . . of a genuine dispute”). The non-movant must show more than the “mere existence of a scintilla of evidence” for elements on which the non-movant bears the burden of production. Anderson, 477 U.S. 242, 252 (1986). Bare assertions, conclusory allegations, or suspicions are insufficient to defeat summary judgment. See Fireman’s Ins. Co. v. DuFresne, 676 F.2d 965, 969 (3d Cir. 1982) (indicating that a party opposing a motion for summary judgment may not “rely merely upon bare assertions, conclusory allegations or suspicions”); Ridgewood Bd. of Educ. v. N.E. for M.E., 172 F.3d 238, 252 (3d Cir. 1999) (explaining that “speculation and conclusory allegations” do not satisfy non-moving party’s duty to “set forth specific facts showing that a genuine issue of material fact exists and that a reasonable factfinder could rule in its favor.”). Additionally, the non-moving party “cannot rely on unsupported allegations, but must go beyond pleadings and provide some evidence that would show that there exists a genuine issue for trial.” Jones v. United Parcel Serv., 214 F.3d 402, 407 (3d Cir. 2000). Moreover, arguments made in briefs “are not evidence and cannot by themselves create a factual dispute sufficient to defeat a summary judgment motion.” Jersey Cent. Power & Light Co. v. Township of Lacey, 772 F.2d 1103, 1109-10 (3d Cir. 1985).
The court “may not weigh the evidence or make credibility determinations.” Boyle v. County of Allegheny, 139 F.3d 386, 393 (3d Cir. 1998) (citing Petruzzi’s IGA Supermarkets., Inc. v. Darling–Del. Co. Inc., 998 F.2d 1224, 1230 (3d Cir. 1993)). Instead, “[w]hen considering whether there exist genuine issues of material fact, the court is required to examine the evidence of record in the light most favorable to the party opposing summary judgment, and resolve all reasonable inferences in that party’s favor.” Wishkin v. Potter, 476 F.3d 180, 184 (3d Cir. 2007). The court must decide “not whether . . . the evidence unmistakably favors one side or the other but whether a fair-minded jury could return a verdict for the plaintiff on the evidence presented.” Anderson, 477 U.S. at 252. “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’” and the court should grant summary judgment in favor of the moving party. Matsushita Elec. Indus. Co., 475 U.S. at 587 (citation omitted).
2. Standard of Review for Benefit Denials Under ERISA
The plaintiff has brought this action under section 502(a)(1)(B) of ERISA, which permits a participant or beneficiary of a covered policy to bring a civil action to recover the benefits due under the terms of the policy. 29 U.S.C. § 1132(a)(1)(B). Generally, the court must review the denial of benefits “under a de novo standard 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). “If the plan gives the administrator or fiduciary discretionary authority to make eligibility determinations, ” the court must review its decision “under an abuse-of-discretion (or arbitrary and capricious) standard.” Viera v. Life Ins. Co. of N. Am., 642 F.3d 407, 413 (3d Cir. 2011) (citations omitted).
Here, the parties agreed in their submissions and at oral argument that the court should apply the abuse-of-discretion (or arbitrary and capricious) standard of review. See Mem. of Law in Supp. of Defs.’ Mot. for Summ. J. (“Defs.’ Mem.”) at 4 (“Bechter’s claim is subject to review under the arbitrary and capricious standard.”), Doc. No. 31; Pl.’s Mot. for Summ. J. Pursuant to Fed.R.Civ.P. 56 at 1, ¶ 3 (“Defendants’ termination of plaintiff’s long term disability benefits was arbitrary and capricious and her Motion for Summary Judgment should therefore be granted.”), Doc. No. 32. Under this standard, “[a]n administrator’s decision is arbitrary and capricious if it is without reason, unsupported by substantial evidence or erroneous as a matter of law.” Fleisher v. Standard Ins. Co., 679 F.3d 116, 121 (3d Cir. 2012) (internal quotations omitted). “A decision is supported by substantial evidence if there is sufficient evidence for a reasonable person to agree with the decision.” Courson v. Bert Bell NFL Player Ret. Plan, 214 F.3d 136, 142 (3d Cir. 2000).
The arbitrary and capricious standard of review “is narrow, and the court is not free to substitute its own judgment for that of the defendants in determining eligibility for plan benefits.” Abnathya v. Hoffmann–La Roche, Inc., 2 F.3d 40, 45 (3d Cir. 1993) (internal quotation omitted). Although “the arbitrary and capricious standard is extremely deferential, [i]t is not ... without some teeth. Deferential review is not no review, and deference need not be abject.” Kuntz v. Aetna Inc., No. 10-CV-00877, 2013 WL 2147945, at *4 (E.D. Pa. May 17, 2013) (citations and internal quotation marks omitted).
[o]n a motion for summary judgment in an ERISA case where the plaintiff claims that benefits were improperly denied, a reviewing court is generally limited to the facts known to the plan administrator at the time the decision was made. Post v. Hartford Ins. Co., 501 F.3d 154, 168 (3d Cir. 2007), overruled on other grounds, Doroshow, 574 F.3d 230. “Consequently, when, as here, a plaintiff alleges that a plan administrator, such as [Aetna], abused its discretion in deciding to terminate benefits, [the Court] generally limit[s][its] review to the administrative record, that is, to the ‘evidence that was before the administrator when [it] made the decision being reviewed.’” Sivalingam v. Unum Provident Corp., 735 F.Supp.2d 189, 194 (E.D. Pa. 2010) (quoting Mitchell v. Eastman Kodak Co., 113 F.3d 433, 440 (3d Cir. 1997)); see also Johnson v. UMWA Health & Ret. Funds, 125 F. App’x 400, 405 (3d Cir. 2005) (“This Court has made clear that the record for arbitrary and capricious review of ERISA benefits denial is the record made before the Plan administrator, which cannot be supplemented during the litigation.”).
Plank v. Devereux Found., No. 13-cv-7337, 2015 WL 451096, at *6 (E.D. Pa. Feb. 2, 2015) (alterations in original).
B. Applicable Record
1. The Long-Term Disability Plan
Federal Express Corporation (“FedEx”) established and maintained a LTD plan (the “LTD Plan”), governed by ERISA, to provide for the funding and payment of LTD benefits for eligible employees. See Administrative Record at AR-000532, Doc. No. 25; see also Am. Compl. at ¶ 7; Def. Aetna Life Ins. Co.’s Answer to Am. Compl. (“Aetna’s Answer”) at ¶ 7.FedEx is the LTD Plan administrator and is charged with administering the LTD Plan, acting through its employee benefits department. AR-000533, AR-000535. During the relevant time period for the plaintiff’s claim, Aetna was the claims-paying administrator for the LTD Plan. AR-000445, AR-000486, AR-000534.
Under the LTD Plan, a “Covered Employee” is eligible to receive long-term benefits from the LTD Plan if he or she incurs a “Disability” as the LTD Plan defines that term. AR-000550. The LTD Plan provides a monthly “Disability Benefit for a Covered Employee equal to 60% of [the Covered Employee’s] Basic Monthly Compensation up to a maximum Disability Benefit of . . . $10, 000 per month.” Id.
As indicated above, the LTD Plan only provides benefits if the Covered Employee incurs a Disability. The LTD Plan defines a Disability (or “Disabled”) as
either an Occupational Disability or a Total Disability; provided, however, that a Covered Employee shall not be deemed to be Disabled or under a Disability unless he is, during the entire period of Disability, under the direct care and treatment of a Practitioner and such Disability is substantiated by significant objective findings which are defined as signs which are noted on a test or medical exam and which are considered significant anatomical, physiological or psychological abnormalities which can be observed apart from the individual’s symptoms.
The LTD Plan provides LTD benefits for a period of up to two years if the Covered Employee incurs an “Occupational Disability.” AR-000550, AR-000552. The LTD Plan defines an “Occupational Disability” in relevant part as “the inability of a Covered Employee, because of a medically-determinable physical or functional impairment or a medically-determinable Mental Impairment (other than an impairment caused by a Chemical Dependency), to perform the duties of his regular occupation.” AR-000540-AR-000541.
To receive LTD benefits beyond the two-year period for an Occupational Disability, a Covered Employee must meet the LTD Plan’s definition of “Total Disability.” AR-000456, AR-000544, AR-000552. The LTD Plan defines a “Total Disability” as “the complete inability of a Covered Employee, because of a medically-determinable physical or functional impairment (other than an impairment caused by a mental or nervous condition or a Chemical Dependency), to engage in any compensable employment for twenty-five hours per week.” AR-000544.
For a Covered Employee’s to prove a Disability, the LTD Plan provides as follows:
No Disability Benefit shall be paid under the Plan unless and until the Claims Paying Administrator has received an application for benefits and information sufficient for the Claims Paying Administrator to determine pursuant to the terms of the Plan that a Disability exists. Such determination shall be made in a fair and consistent manner for all participants in the Plan. Such information may, as the Claims Paying Administrator shall determine, consist of a certification from the Covered Employee’s attending Practitioner, in the form prescribed by the Claims Paying Administrator, information in the form of personal references, narrative reports, pathology reports, x-rays and any other medical records or other information as may be required by the Claims Paying Administrator. In addition, a Covered Employee may be required, as the Claims Paying Administrator shall determine, to submit continuing proof of Disability in the form of the information described above, as well as evidence that he continues to be under the care and treatment of a Practitioner during the entire period of Disability. If, in the opinion of the Claims Paying Administrator, the Practitioner selected by the Covered Employee cannot substantiate the Disability for which a claim is being made or benefits are being paid hereunder, such Employee may be required to submit himself to an examination by a Practitioner selected by the Claims Paying Administrator. The burden of proof for establishing a Disability is on the Covered Employee.
The SPD provides additional guidance for an employee as to how to prove a disability and states in pertinent part as follows:
You or your health care professional must provide proof that you are disabled, based on significant objective findings such as:
[-] Medical examination findings
[-] Test results
[-] X-ray results
[-] Observation of anatomical, physiological or psychological abnormalities
It is important to remember pain alone is not proof of disability.
AR-000456. The SPD also provides that “[i]f the information from [the Covered Employee’s] health care professional does not prove that [the Covered Employee] is disabled, Aetna may ask you to submit to an independent medical exam by a health care professional of [Aetna’s] choosing.” AR-000457.
If Aetna denies a claim for LTD benefits, it must provide the Covered Employee with a Notice of Denial. AR-000576-AR-000577. Once Aetna denies the claim, the Covered Employee has the right to request the appeal committee to review the denial of benefits. AR-000579. In addition, the Covered Employee has the right to “submit written comments, documents, records, and other information relating to the claim for the benefits in the manner and within the time reasonably set by the Administrator in order that such submissions may be prepared for and reviewed by the appeal committee.” AR-000580.
When reviewing the denial of benefits appeal, Aetna’s appeal committee has the power to [i]nterpret the Plan’s provisions in its sole and exclusive discretion in accordance with its terms with respect to all matters properly brought before it pursuant to this Section 5.3, including, but not limited to, matters relating to the eligibility of a claimant for benefits under the Plan. The determination of the appeal committee shall be made in a fair and consistent manner in accordance with the Plan’s terms and its decision shall be final, subject only to a determination by a court of competent jurisdiction that the committee’s decision was arbitrary and capricious.
2. The Plaintiff’s Claims for Short-Term and Long-Term Disability Benefits
Starting on June 1, 2006, FedEx Tech Connect, Inc. (“FedEx Tech Connect”) employed the plaintiff as a senior customer services representative. Am. Compl. at ¶ 6; Aetna’s Answer at ¶ 6; Def. Federal Express Corp. Long Term Disability Plan’s Answer to Am. Compl. (“FedEx LTD Plan’s Answer”) at ¶ 6, Doc. No. 20. The plaintiff’s employment with FedEx Tech Connect ended on July 27, 2011. Perrine Decl. at ¶ 8.
During the plaintiff’s employment with FedEx Tech Connect, she was a Covered Employee under the LTD Plan. See Am. Compl. at ¶ 8; Aetna’s Answer at ¶ 8; FedEx LTD Plan’s Answer at ¶ 8; see also AR-000001-AR-000002 (recognizing that the plaintiff was a Covered Employee). As a Covered Employee, the plaintiff was entitled to ...