Opinion
No. C99-2073 MJM
August 8, 2001
OPINION and ORDER
Pending before this Court are three separate motions filed by Plaintiff, Brian Glick: (1) a motion to set aside this Court's ruling of March 6, 2001; (2) a motion for sanctions; and (3) a motion to amend the administrative record. (Doc. nos. 35, 36, and 38). For the reasons stated herein, all three motions are denied.
Background
For a complete factual history of Mr. Glick's claim, see the Court's Order of March 6, 2001. (Doc. no. 33).
Mr. Glick filed the instant lawsuit pursuant to the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1054 et seq., seeking to recover benefits under a long-term disability benefits plan. Defendant, Cooperative Benefit Administrators, Inc. ("CBA") administers the National Rural Electric Cooperative Association Long-Term Disability Plan ("NRECA LTD Plan") of which Mr. Glick is a participant by virtue of his employment with Dairyland Power Cooperative ("Dairyland") in Lacrosse, Wisconsin.
CBA moved for summary judgment arguing the decision to deny Mr. Glick long-term disability benefits under NRECA's Plan was not arbitrary and capricious, but instead was supported by substantial evidence. In response to CBA's motion, Mr. Glick did not dispute the substantive basis for CBA's decision. Rather, by way of an Amended Complaint, Mr. Glick raised two new issues which he maintained created a genuine disputed fact for trial. First, Mr. Glick argued that he did not receive a Summary Plan Description ("SPD") of the NRECA LTD Plan as required by 29 U.S.C. § 1102 of ERISA. Second, he alleged that there was a discrepancy between the articulation of the standard for determining "totally disabled" in the SPD and the articulation of the standard in CBA's correspondence to Mr. Glick. The discrepancy, Mr. Glick argued, estopped CBA from relying on the purportedly more stringent standard as outlined in the SPD, which Mr. Glick maintained he did not receive.
CBA sought and was granted leave of the Court to file a supplemental memorandum with accompanying evidence to respond to Mr. Glick's assertion that he did not receive an SPD of the NRECA LTD Plan. CBA's supplemental evidence contained a signed receipt by Mr. Glick acknowledging receipt of an employee handbook which contained a copy of the SPD.
On March 6, 2001, the Court granted CBA's motion for summary judgment finding Mr. Glick failed to generate a triable issue of fact on any of the aforementioned arguments. Specifically in regards to Mr. Glick's present motions, the Court found there was substantial undisputed evidence in the record to support CBA's finding that Mr. Glick is not "totally disabled" as defined by the formal NRECA LTD Plan, and that Mr. Glick failed to generate a triable issue of fact as to whether he received a copy of the SPD.
On March 8, 2001, following his receipt of the Court's ruling, Mr. Glick's attorney informed CBA's counsel that he had not received the supplemental memorandum and accompanying documents which CBA filed with this Court on December 28, 2000. Prior to the correspondence of March 8th, CBA contends it was unaware that Mr. Glick's counsel had not received the supplemental memorandum and that its counsel followed normal office procedures for service and certification thereof, in compliance with Federal Rule of Civil Procedure 5 and Local Rule 5.1.
Upon reviewing CBA's supplemental memorandum and accompanying evidence, Mr. Glick realized CBA's newly proffered evidence was information he had requested during discovery but was unable to obtain from CBA. Specifically, in Mr. Glick's request for production of documents, he requested a copy of the SPD and any documentation evincing Mr. Glick had received a copy of the SPD and explanations thereof. CBA refused to proffer these documents maintaining the requests were irrelevant, not reasonably calculated to lead to admissible evidence, overly broad and unduly burdensome.
Some two years subsequent to CBA's denial of Mr. Glick's long-term disability benefits, but prior to this Court's March 6th ruling, Mr. Glick was awarded disability benefits from the Social Security Administration. Mr. Glick was originally denied these benefits and this denial was before CBA when deciding whether to award him benefits under the NRECA LTD Plan. After a class action settlement with the Social Security Administration, of which Mr. Glick was a beneficiary, Mr. Glick's claim for Social Security benefits was revisited. The Social Security Administration found he was disabled and entitled to benefits. Accordingly, on December 29, 2000, Mr. Glick's counsel sent CBA a letter requesting the Social Security Administration's recent findings be taken into consideration in determining his eligibility for long-term benefits under the NRECA LTD Plan. CBA's counsel responded in a letter dated January 4, 2001, and stated in relevant part:
Mr. Glick's change in status with regard to eligibility for Social Security Benefits does not, however, alter his eligibility for LTD Benefits. CBA adjudicated Mr. Glick's eligibility for benefits based on the terms of the NRECA LTD Plan and the information submitted to it by you as Mr. Glick's attorney. You have not sent us the Social Security award letter, so we do not know the basis on which Social Security benefits were awarded to Mr. Glick or the specific standard of eligibility that was applied. Nor do we know what evidence was presented to the Social Security Administration, as opposed to the CBA Appeal Committee. In any event, CBA's decision was made independently of the action by the Social Security Administration. Consequently, CBA does not believe the recent decision by Social Security "significantly and dramatically changes the nature of this case."
Based on the foregoing, Mr. Glick filed the three motions presently pending before the Court. The Court then held a telephonic hearing on June 6, 2001 to hear counsels' respective positions on the pending motions. The Court reserved ruling on all three motions and allowed Mr. Glick to file a supplemental brief in resistance to CBA's previously submitted motion for summary judgment, as well as provide supplemental evidence in support of its motion to amend the administrative record.
Discussion
Given the odd procedural posture of this case and the somewhat fragmented briefing of the disputed issues, the Court will first attempt to state with clarity those issues that remain for the Court to resolve and/or revisit. Again, Mr. Glick's three pending motions are — a motion to set aside this Court's grant of CBA's summary judgment; a motion to amend the administrative record; and a motion for sanctions. Mr. Glick's original motion to set aside the Court's March 6th ruling was based on the supposition that he did not receive CBA's response memorandum and accompanying evidence regarding his receipt of the SPD. However, Mr. Glick's supplemental brief to the Court in support of his resistance to CBA's motion for summary judgment and in support of his motion to set aside this Court's earlier ruling, makes no mention of his purported failure to receive an SPD. Instead Mr. Glick attacks the substantive basis for CBA's denial of his LTD benefits arguing the denial was an abuse of CBA's discretion. The Court will therefore assume that Mr. Glick has abandoned his argument that he did not receive an SPD and focus only on Mr. Glick's substantive challenge to CBA's denial of benefits. Mr. Glick's motion to amend the administrative record is based on the recent findings of the Social Security Administration. Finally, Mr. Glick's motion for sanctions is based on CBA's failure to proffer requested relevant evidence during discovery. The Court will address each motion in turn.
Neither does Mr. Glick refer to his argument about differing standards for LTD benefits in the SPD and CBA's correspondence. The Court will likewise assume that Mr. Glick has abandoned that argument for purposes of the present motions.
A. CBA's Denial of Mr. Glick's LTD benefits
ERISA itself does not specify the appropriate standard of review for courts reviewing a plan's denial of benefits. See 29 U.S.C. § 1132(a)(1)(B). The Supreme Court has held however 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 and Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). If such discretionary authority is given by the plan, the proper standard of review of the administrator's decision is abuse of discretion. Id.; see also Cox v. Mid-America Dairymen, Inc., 965 F.2d 569, 571 (8th Cir. 1992) (Cox I), aff'd after remand, 13 F.3d 272 (8th Cir. 1993) (Cox II). In the instant suit the parties do not dispute that the NRECA LTD Plan gives the administrator, CBA, discretionary authority to determine eligibility for benefits or to construe the terms of the plan.
NRECA has at all times delegated full and final authority to CBA to interpret the provisions of the NRECA LTD Plan and to determine eligibility for benefits under the Plan. Specifically, section 9.07 of the NRECA Group Benefits Program provides:
9.07 Grant of Discretion. In discharging the duties assigned to them under the Program, the Committee, the Plan Administrator and CBA and their delegates have the discretion and final authority to interpret and construe the terms of the Plans; to determine coverage and eligibility for benefits under the Plans; to adopt, amend, and rescind rules, regulations and procedures pertaining to their duties under the Plans, and the administration of the Plans; and to make all other determinations deemed necessary or advisable for the discharge of their duties or the administration of the Program. The discretionary authority of the Committee, the Plan Administrator and CBA and their delegates is final, absolute, conclusive and exclusive, and binds all parties so long as exercised in good faith. NRECA, as sponsor of the Program, specifically intends that judicial review of any decision of the Committee, the Plan Administrator or CBA, or an insurance company that is a claims adjudicator under section 8.02 and their delegates be limited to the arbitrary and capricious standard of review.
In evaluating a plan administrator's fact-based disability determinations under an abuse of discretion standard, courts look to whether the decision is supported by substantial evidence. See Donaho v. FMC Corp., 74 F.3d 894, 900 (8th Cir. 1996). Thus, in the absence of bad faith or conflict of interest, a 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." Id. (citing with approval Abnathya v. Hoffmann-La Roche, Inc., 2 F.3d 40, 45 (3d Cir. 1993) (remaining citations omitted); and Sandoval v. Aetna Life and Cas. Ins. Co., 967 F.2d 377, 382 (10th Cir. 1992) (adopting substantial evidence standard)). Substantial evidence "means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229 (1938). "In quantifiable terms, '[s]ubstantial evidence requires 'more than a scintilla but less than a preponderance.'" Donaho, 74 F.3d at 900 n. 10 (citing Sandoval, 967 F.2d at 382).
Mr. Glick's challenge of CBA's decision is premised on the notion that his examining doctor, on which CBA relied, did not evaluate "the totality of his medical condition." Glick's Resp. at 8. Specifically, he contends that while his doctor looked to his individual infirmities with regards to back, neck and arms, she "ignored all of the other functional deficits that resulted from the injuries he suffered in the automobile collision." Glick's Resp. at 8.
Upon review of the record, however, it is clear that CBA relied on more than simply the principal examining doctor's assertion of Mr. Glick's disability. The record reveals that CBA hired an organization, Intracorp, to perform a transferable skills analysis; it employed Dr. Gall of the Gunderson Clinic to examine Mr. Glick's knee condition; it looked to Mr. Glick's functional capacity evaluation; and it took into consideration Mr. Glick's own representations regarding his ability to work. The evidence before CBA unanimously indicated that Mr. Glick could perform light work.
Although Mr. Glick contends that the examining physicians are inaccurate because no one doctor treated him for each and every disabling condition, Mr. Glick failed to proffer any doctor's report finding him totally disabled. Indeed, Mr. Glick and his counsel were aware of the opportunity to supplement the record during the appeal process, but his counsel instead stated "we are of the belief that the relevant documents concerning Mr. Glick's appeal are already present before the board. . . ." May 18, 1998 letter from Anderson to CBA. Mr. Glick's failure to supplement the record does not render an otherwise reasonable determination, supported by substantial evidence, an abuse of discretion. See Davidson v. Prudential Insurance Company of America, 953 F.2d 1093, 1095 (8th Cir. 1992).
As stated in the Court's original grant of CBA's motion for summary judgment, there is substantial evidence in the record to support CBA's finding that Mr. Glick is not "totally disabled," defined by the formal NRECA LTD Plan as "unable to engage in any and every gainful occupation you are reasonably fitted for by education, training or experience." The Eighth Circuit has made clear that, under a discretionary review of an administrator's decision, "[i]f the decision is supported by a reasonable explanation, it should not be disturbed, even though a different reasonable interpretation could have been made." Cash v. Wal-Mart Health Program Plan, 107 F.3d 637, 641 (8th Cir. 1997). Accordingly, the Court does not find CBA's decision to terminate Mr. Glick's LTD benefits was an abuse of discretion.
B. Motion to Amend the Administrative Record
Mr. Glick maintains that this Court's earlier ruling should be set aside and the administrative record should be amended to include the Social Security Administration's recent finding that he is entitled to long-term benefits due to his disability. Put more succinctly, Mr. Glick avers CBA's decision to deny his benefits should be re-evaluated in light of his grant of Social Security benefits.
The grant of Social Security benefits constitutes new evidence that was not before the plan's administrator when making the decision about Mr. Glick's eligibility for long-term benefits. As a general rule, a court cannot consider new evidence when reviewing a plan administrator's denial of benefits. See Donatelli v. Home Ins. Co., 992 F.2d 763, 765 (8th Cir. 1993). In certain circumstances, the Third, Fourth, Sixth, Seventh, Eighth, Ninth and Eleventh Circuits have found the consideration of new evidence is warranted "to enable the full exercise of informed and independent judgment." Casey v. Uddeholm Corp., 32 F.3d 1094, 1098-99 n. 4 (7th Cir. 1994); Luby v. Teamsters Health, Welfare and Pension Trust Funds, 944 F.2d 1176, 1184-85 (3d Cir. 1991) ; Quesinberry v. Life Ins. Co. of North America, 987 F.2d 1017, 1025 (4th Cir. 1993) ( en banc); Perry v. Simplicity Eng'g, Div. of Lukens Gen. Indus., Inc., 900 F.2d 963, 966 (6th Cir. 1990) (limiting the district court's review to the evidence presented to the plan administrator) ; Donatelli, 992 F.2d at 765; Mongeluzo v. Baxter Travenol Long Term Disability Ben. Plan, 46 F.3d 938, 944 (9th Cir. 1995); and Moon v. American Home Assurance Co., 888 F.2d 86, 89 (11th Cir. 1989). For instance, in Quesinberry, the Fourth Circuit stated:
[W]e . . . believe that the purposes of ERISA . . . warrant significant restraints on the district court's ability to allow evidence beyond what was presented to the administrator. In our view, the most desirable approach to the proper scope of de novo review under ERISA is one which balances the multiple purposes of ERISA. Consequently, we adopt a scope of review that permits the district court in its discretion to allow evidence that was not before the plan administrator. The district court should exercise its discretion, however, only when circumstances clearly establish that additional evidence is necessary to conduct an adequate de novo review of the benefit decision. In most cases, where additional evidence is not necessary for adequate review of the benefits decision, the district court should only look at the evidence that was before the plan administrator . . . at the time of the determination.987 F.2d at 1025 (emphasis added). Unlike Quesinberry, and its counterparts, the standard of review in the instant case is abuse of discretion, not de novo. The Eighth Circuit has held that such additional evidence, "is ruled out on deferential review" and in fact it is discouraged even on de novo review to "ensure expeditious judicial review of ERISA benefit decisions and to keep district courts from becoming substitute plan administrators." Brown v. Seitz Foods, Inc. Disability Benefit Plan, 140 F.3d 1198, 1200-01 (8th Cir. 1998) (quotations omitted); see also Cash, 107 F.3d at 641-42 (finding "review under the deferential standard is limited "to evidence that was before" the Committee (citations omitted); Collins v. Central States Southeast and Southwest Areas Health Welfare Fund, 18 F.3d 556, 560 (8th Cir. 1991) (finding "[i]n deciding whether the Trustees' denial of benefits was arbitrary or capricious, we limit our review to the evidence that was before the Trustees");and Donatelli, 992 F.2d at 765. This Court simply does not have the authority to consider newly discovered evidence in conducting a deferential review of CBA's decision.
Mr. Glick, of course, seeks "remand" of his case to the plan administrator for a new determination of disability based on the Social Security Administration's recent findings. However, a remand solely based on newly discovered evidence appears to fall under the aforementioned proscription against consideration of the newly discovered evidence. Put another way, a district court's responsibility lies in determining whether the administrator's actions were an abuse of its discretion, not in determining whether, in the district court's view, a claimant is entitled to disability benefits in light of new evidence. See Sandoval, 967 F.2d at 381. "In effect, a curtain falls when the fiduciary completes its review, and for purposes of determining if substantial evidence supported the decision, the district court must evaluate the record as it was at the time of the decision." Id. (citing Perry v. Simplicity Engineering, 900 F.2d 963, 967 (6th Cir. 1990); and Voliva v. Seafarers Pension Plan, 858 F.2d 195, 196 (4th Cir. 1988)). This Court's finding that CBA's decision was based on substantial evidence thus precludes remand based on evidence that was not before CBA at the time its decision was made.
Mr. Glick points to Donaho v. FMC Corp., 74 F.3d 894 (8th Cir. 1996) and Blessing v. Deere Co., 985 F. Supp. 899 (S.D.Ill. 1997) in support of his argument to remand the case to the plan administrator and amend the administrative record. However the facts of those cases do not parallel the facts of the case before this Court. In Donaho the Eighth Circuit remanded the case to the district court after holding the plan's administrator had abused its discretion in denying the plaintiff LTD benefits. See 74 F.3d at 900. The court's decision was not based on newly discovered evidence that called into question the plan administrator's decision. Rather, the court took issue with the administrator's analysis of the evidence before it at the time the decision was made.
The Donaho court was particularly troubled by the fact that the administrator ignored the opinions of three examining physicians who found that the plaintiff was totally disabled. 74. F.3d at 900-01. The court explained further that while the reviewing physician originally adopted the findings of the treating physician that the plaintiff was totally disabled, he then changed course after speaking to the plan's administrator. Id. These factors and others led to the Donaho court's decision to remand. By contrast, CBA did not have a physician's report before it at the time its decision was made stating Mr. Glick was totally disabled within the meaning of the NRECA LTD Plan.
Similarly, in Blessing the court remanded the case because the plan's administrator failed to articulate how she resolved conflicts in the evidence which led to the denial of the plaintiff's benefits, and she likewise failed to provide sufficient rationale for the denial of benefits in order "to permit the court review of the decision under a deferential standard of review." 985 F. Supp. at 901. The same cannot be said for CBA's review and subsequent denial of Mr. Glick's claim of LTD benefits. CBA adequately articulated its reasons for the denial of benefits and proffered substantial evidence in support.
While these cases illustrate that a reviewing court may remand cases to the plan administrator for further review, the remand is not an outgrowth of new evidence which could alter the outcome but rather is based on a faulty or unreasonable resolution based on the record before the plan's administrator in the first instance. To remand this case for the consideration of evidence that surfaced some 30 months after CBA's determination would be contrary to the spirit of the Eighth Circuit's admonition against considering new evidence — that is, "to ensure expeditious judicial review of ERISA benefit decisions and to keep district courts from becoming substitute plan administrators." Donatelli, 992 F.2d at 765 (emphasis added).
For these reasons, Mr. Glick's motion to amend the administrative record is denied.
B. Mr. Glick's motion for sanctions
Mr. Glick maintains that this Court should impose sanctions on CBA pursuant to Federal Rule of Civil Procedure 37 for failure to provide discovery. Specifically, Mr. Glick contends that CBA refused to produce a copy of the SPD, or any receipt indicating that Mr. Glick received the same, stating that such request was "irrelevant and not reasonably calculated to lead to admissible evidence." Moreover, CBA stated that "no receipt indicating delivery of the LTD Plan to Mr. Glick is maintained by CBA."
CBA's refusal to produce this evidence during discovery is somewhat suspect given it is precisely this evidence upon which the Court relied in determining that Mr. Glick has failed to generate a question of fact about whether he had received an SPD. However the Court also noted in its original opinion that even assuming CBA violated ERISA by failing to provide an SPD describing its severance benefit plans, see 29 U.S.C. § 1024(b), "an ERISA disclosure violation does not entitle a participant or beneficiary to benefits to which he is not entitled under the plan." Palmisano v. Allina Health Systems, Inc, 190 F.3d 881, 888-889 (8th Cir. 1999) (citing Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155, 1170 (3d Cir. 1990)). March 6, 2001 Order and Opinion, at 17 n. 4). Moreover, Mr. Glick was given leave of the Court to brief this issue further after having received all the relevant information and with the benefit of the Court's original ruling on the matter. Viewed in this light, the Court does not find CBA's actions are those which warrant sanctions.
ORDER
For the reasons stated herein, and those stated in the Court's earlier order of March 6, 2001, it is Ordered that:
Plaintiff's motion to set aside this Court's judgment of March 6, 2001 is DENIED. (Doc. no. 35).
Plaintiff's motion for sanctions is DENIED. (Doc. no. 36).
Plaintiff's motion to amend the administrative record is DENIED. (Doc. no. 38).
Done and so ordered.