Norman, et al v. Life Insurance Company of North AmericaMOTION to Dismiss CaseE.D. La.March 24, 2017IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA RUSTY NORMAN and WEYMAN MAXSON, on behalf of themselves and all others similarly situated, Plaintiffs, vs. LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant. * * * * * * * * * * * * Case No. 2:16-cv-17271 Judge: Ivan L.R. Lemelle Magistrate Judge: Joseph C. Wilkinson, Jr. DEFENDANT’S MOTION TO DISMISS AND MOTION TO STRIKE CLASS ALLEGATIONS Defendant, Life Insurance Company of North America (“Life Insurance”), by its attorneys and pursuant to the Federal Rules of Civil Procedure, hereby moves this Court for entry of an order dismissing Plaintiff’s Complaint or, in the alternative, striking the Complaint’s class allegations. In support of its Motion, Defendant submits herewith its supporting Memorandum of Law In Support of Defendant Life Insurance Company of North America’s Motion to Dismiss and Motion to Strike Class Allegations and exhibits thereto. WHEREFORE, Defendant, Life Insurance Company of North America, respectfully requests that this Court enter an order dismissing Plaintiff’s Complaint. Alternatively, Defendant respectfully requests that this Court enter an order striking the Complaint’s class allegations. Dated: March 24, 2017 Respectfully submitted, LIFE INSURANCE COMPANY OF NORTH AMERICA By:/s/ Peter Shadzik One of Its Attorneys Case 2:16-cv-17271-ILRL-JCW Document 26 Filed 03/24/17 Page 1 of 4 2 JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: (504) 846-8464 Fax: (800) 977-8810 lwelch@mcsalaw.com Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26 Filed 03/24/17 Page 2 of 4 CERTIFICATE OF SERVICE I hereby certify that on March 24, 2017 a copy of the foregoing pleading was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Peter Shadzik JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: 504-846-8464 Fax: 800-977-8810 lwelch@mcsalaw.com Case 2:16-cv-17271-ILRL-JCW Document 26 Filed 03/24/17 Page 3 of 4 2 Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26 Filed 03/24/17 Page 4 of 4 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA WEYMAN MAXSON, on behalf of himself and all others similarly situated, and ASHLEE ANE NORMAN, Administrator of the Estate of Rusty Norman, Decedent, Plaintiffs, vs. LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant. * * * * * * * * * * * * Case No. 2:16-cv-17271 Judge: Ivan L.R. Lemelle Magistrate Judge: Joseph C. Wilkinson, Jr. MEMORANDUM OF LAW IN SUPPORT OF DEFENDANT LIFE INSURANCE COMPANY OF NORTH AMERICA’S MOTION TO DISMISS AND MOTION TO STRIKE CLASS ALLEGATIONS Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 1 of 28 TABLE OF CONTENTS Page -i- I. INTRODUCTION ..............................................................................................................1 II. STATEMENT OF RELEVANT FACTS...........................................................................3 A. The Jones Act and Maritime Common Law...........................................................3 B. The Crosby Tugs LLC LTD Benefits Plan and The Martin Resource LTD Plan .........................................................................................................................4 C. Rusty Norman.........................................................................................................5 D. Weyman Maxson....................................................................................................7 III. PLAINTIFFS’ CLAIMS FAIL AS A MATTER OF LAW................................................7 A. The Abuse of Discretion Standard Applies to LINA’s Decision to Offset Benefits. ..................................................................................................................8 B. Norman’s and Maxson’s LTD Benefits Were Properly Subject to Offset. ............9 1. Norman’s LTD Benefits Were Properly Offset Under The Crosby Tugs Plan. ...................................................................................................9 2. Maxson’s LTD Benefits Were Properly Offset Under The Martin Resource Plan. ..........................................................................................12 IV. THE CLASS ALLEGATIONS SHOULD BE STRICKEN BECAUSE THE AMENDED COMPLAINT, ON ITS FACE, FAILS TO SATISFY THE REQUIREMENTS OF RULE 23. ....................................................................................12 V. CONCLUSION.................................................................................................................20 Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 2 of 28 -ii- TABLE OF AUTHORITIES Page(s) CASES Abogado v. Int’l. Marine Carriers, 890 F. Supp. 626 (S.D. Tex. 1995)................................................................................2, 11, 12 Aguilar v. Allstate Fire & Cas. Ins. Co., No. 06-4660, 2007 WL 734809 (E.D. La. Mar. 6, 2007) ..................................................17, 18 Amerisure Ins. Co. v. Navigators Ins. Co., 611 F.3d 299 (5th Cir. 2010) ...................................................................................................10 Ashcroft v. Iqbal, 556 U.S. 662 (2009) ..................................................................................................................8 Barasich v. Shell Pipeline Co., LP, No. 05-4180, 2008 WL 6468611 (E.D. La. June 19, 2008) ....................................................19 Bauer v. Dean Morris, L.L.P., Nos. 08-5013, 08-5014, 2011 WL 3924963 (E.D. La. Sept. 7, 2011)...............................14, 15 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ..................................................................................................................7 Bevrotte v. Caesars Entm’t Corp., No. 11-543, 2011 WL 4634174 (E.D. La. Oct. 4, 2011) .........................................................19 Chandris, Inc. v. Latsis., 515 U.S. 347 (1995) ................................................................................................................10 Coats v. Penrod Drilling Corp., 61 F.3d 1113 (5th Cir. 1995) ...................................................................................................10 Daigle v. L & L Marine Trans. Co., 322 F. Supp. 2d 717 (E.D. La. 2004).......................................................................................10 Davis v. Odeco, Inc., 18 F.3d 1237 (5th Cir. 1994) ...................................................................................................11 DeBremaecker v. Short, 433 F.2d 733 (5th Cir. 1970) ...................................................................................................14 Duvio v. Viking Range Corp., No. 12-1430, 2013 WL 1180948 (E.D. La. Mar. 20, 2013) ....................................................19 Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 3 of 28 iii Fed. Ins. Co. v. Infoglide Corp., No. A-05-CA-189-AWA, 2006 WL 2050694 (W.D. Tex. July 18, 2006)................................9 Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989) ..................................................................................................................8 Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147 (1982) ................................................................................................................13 Guevara v. Maritime Overseas Corp., 34 F.3d 1279 (5th Cir. 1994) .........................................................................................2, 11, 12 Henry v. Allstate Ins. Co., 2007 WL 2287817 (E.D. La. 2007).........................................................................................18 House v. Am. United Life Ins. Co., No. Civ. A 02-1342, 2003 WL 21243502 (E.D. La. May 23, 2003).........................................9 In re FEMA Trailer Formaldehyde Prods. Liab. Litig., 2008 WL 5423488 (E.D. La. 2008).........................................................................................19 In re Katrina Canal Breaches Litig., 495 F.3d 191 (5th Cir. 2007) .....................................................................................................5 In re Katrina Canal Breaches Litigation, 401 F. App’x 884 (5th Cir. 2010)............................................................................................17 In re Maryland Marine, Inc., 641 F. Supp. 2d 579 (E.D. La. 2009).......................................................................................10 John v. Nat’l Sec. Fire & Cas. Co., 501 F.3d 443 (5th Cir. 2007) .............................................................................................13, 14 John v. Nat'l Sec. Fire & Cas. Co., No. 06-1407, 2006 WL 3228409 (W.D. La. Nov. 3, 2006), aff’d, 501 F.3d 443 (5th Cir. 2007) ...................................................................................................................14, 15 Johnson v. Cenac Towing, Inc., 599 F. Supp. 2d 721 (E.D. La. 2009).........................................................................................4 Metcalfe v. Coastal Towing, L.L.C., No. 07-8674, 2009 WL 393704 (E.D. La. Feb. 12, 2009).........................................................4 Milton v. Blue Cross Blue Shield of Tex., Inc., No. 16-458, 2016 WL 2926846 (E.D. La. May 19, 2016).........................................................8 Norman v. Crosby Tugs, LLC, et al., Case No. 15-cv-06878-LMA-KWR (E.D. La. Aug. 8, 2016) .......................................6, 11, 12 Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 4 of 28 iv Norris v. Hearst Trust, 500 F.3d 454 (5th Cir. 2007) .....................................................................................................6 Paternostro v. Choice Hotel Int’l Servs. Corp., 309 F.R.D. 397 (E.D. La. 2015) ..............................................................................................13 Perry v. Prudential Co. of Am., No. 11-559, 2012 WL 253403 (M.D. La. Jan. 26, 2012) ..........................................................5 Sanders v. Apple Inc., 672 F. Supp. 2d 978 (N.D. Cal. 2009).....................................................................................14 Simms v. Jones, Case No. 3:11-cv-0248-M, 2011 WL 5978594 (N.D. Tex. Nov. 30, 2011) .............................6 Spiers v. Liberty Mut. Fire Ins. Co., 2006 WL 4764430 (E.D. La. 2006).........................................................................................18 Steering Comm. v. Exxon Mobil Corp., 461 F.3d 598 (5th Cir. 2006) ...................................................................................................17 Thomas v. Prudential Ins. Co. of Am., No. 14-00747-BAJ-RLB, 2015 WL 2406036 (M.D. La. May 19, 2015) ..................................8 Unger v. Amedisys Inc., 401 F.3d 316 (5th Cir. 2005) .......................................................................................13, 14, 17 Waters v. Electrolux Home Prods., Inc., 2016 WL 3926431 (N.D. W. Va. July 18, 2016).....................................................................14 STATUTES 45 U.S.C.A. § 51 .............................................................................................................................3 46 U.S.C. § 30104 ...........................................................................................................................3 Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 5 of 28 I. INTRODUCTION This is a claim for benefits under ERISA Section 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). In the sole Count of their First Amended Complaint (“Amended Complaint”), Plaintiff Ashlee Ane Norman, Administrator of the Estate of Rusty Norman (“Norman”),1 and Plaintiff Weyman Maxson (“Maxson”) bring this purported class action against Defendant Life Insurance Company of North America (“LINA”), alleging that LINA has improperly calculated their monthly long term disability (“LTD”) benefits under the terms of their respective LTD Plans by offsetting certain monies Plaintiffs received from their respective employers.2 Specifically, Plaintiffs contend that they received “maintenance”3 under Federal maritime law, and that LINA improperly offset those monies against Plaintiffs’ LTD benefits. The Amended Complaint also alleges that Norman (but not Maxson) received additional monies in settlement of a lawsuit he filed against his employer under both the Jones Act and “General Maritime Law,” and that LINA also improperly offset those amounts. The essence of Plaintiffs’ claims is that the payments the men received are not “similar to” workers’ compensation under the LTD Plans (which they ostensibly acknowledge would be an appropriate offset), and therefore should not be subject to offset under their respective Plans’ terms. Plaintiffs’ claims fail as a matter of law. 1 Rusty Norman passed away on December 10, 2016, after which Ashlee Ane Norman was substituted as a party in his stead. See Order, Dkt. 8; Am. Compl. ¶ 2. References to “Norman” in this motion refer to Rusty Norman. 2 Plaintiffs initially filed this lawsuit in the Eastern District of Michigan, Norman, et al. v. Life Ins. Co. of North Am., et al., Case No. 16-cv-13535-DPH-MKM, which they voluntarily dismissed and refiled here. LINA moved to dismiss on February 13, 2017, and in response, Plaintiffs sought leave to file an amended complaint. Leave was granted and the Amended Complaint was filed on March 10, 2017, Dkt. 23, 24. 3 See infra at p. 4. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 6 of 28 2 First, Plaintiffs’ claims essentially ignore that the Plans have three separate offset provisions that apply to the payments they received. Although one of those provisions refers to “workers’ compensation” (discussed below), the other two do not. Instead they require an offset for money received (1) under any “law payable for Injury or Sickness provided as a result of employment with the Employer” or (2) “because of loss of earnings or earning capacity through settlement, judgment, arbitration or otherwise, where a third party may be liable, regardless of whether liability is determined.” See infra at pp. 4-5. As alleged, the payments that each Plaintiff received fall squarely within those other provisions and therefore are subject to offset as a matter of law. Second, Plaintiffs ignore the specific language of the one offset provision they acknowledge in the Amended Complaint. That provision requires an offset for any money received “under any workers’ compensation, occupational disease, unemployment compensation law or similar state or federal law payable for Injury or Sickness arising out of work with the Employer, including all permanent and temporary disability benefits.” Maritime common law – which allows an award of maintenance, cure, and lost wages without any proof of negligence or wrongdoing – is similar to workers’ compensation. See Guevara v. Maritime Overseas Corp., 34 F.3d 1279, 1284 (5th Cir. 1994) (maritime common law is “[e]ssentially a form of workers’ compensation-like employee benefit” with “no counterpart … in [ ] the Jones Act”); Abogado v. Int’l. Marine Carriers, 890 F. Supp. 626, 630 (S.D. Tex. 1995) (holding that claims for maintenance and cure “are similar to worker’s compensation”). And Norman himself agreed that the settlement monies he received were in exchange for releasing (among other things) claims under “the workers’ compensation laws of Louisiana, Pennsylvania, or the Federal laws of the United States, including but not limited to the Jones Act. . . .” Thus, Norman specifically agreed Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 7 of 28 3 he received the payments in exchange for releasing workers’ compensation claims, and that the Jones Act was a type of workers’ compensation law. As such, the monies he received are subject to offset under the terms of his LTD Plan. Thus, under Federal Rule of Civil Procedure 12(b)(6), Plaintiffs’ claim fails as a matter of law and should be dismissed. In addition, Plaintiffs’ class allegations should be stricken under Rules 12 and/or 23. Most importantly, individual questions of law and fact will predominate any adjudication of Plaintiffs’ claims, particularly because according to Plaintiffs, determining whether any particular payments received by each putative class member are properly subject to offset would require a review of the specific circumstances that led to each payment, including (but not limited to) the specific terms of any release or other agreement executed by that putative class member, and what that class member was told or understood about the reasons for the offset. These individualized issues are apparent on the face of the Amended Complaint – indeed, Plaintiff Norman even makes allegations that are specific to him and do not even apply to Plaintiff Maxson – so Plaintiffs’ class allegations should be stricken. II. STATEMENT OF RELEVANT FACTS A. The Jones Act and Maritime Common Law Both the Jones Act, 46 U.S.C. § 30104, and the maritime common law provide seamen with a right to recover from their employer if they are injured in the scope of their employment. The Jones Act does not itself describe how an employee may recover from his employer; rather, it incorporates provisions of the Federal Employer Liability Act (“FELA”) in prescribing a right to recovery. See 46 U.S.C. § 30104 (“Laws of the United States regulating recovery for personal injury to, or death of, a railway employee apply to an action under this section”). FELA, in turn, provides injured employees with a cause of action for negligence. See 45 U.S.C.A. § 51. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 8 of 28 4 However, it is a long-held principle that the definition of negligence is broadened in FELA and Jones Act actions, affording the statutes a liberal construction. Metcalfe v. Coastal Towing, L.L.C., No. 07-8674, 2009 WL 393704, at *1 (E.D. La. Feb. 12, 2009) (“in a Jones Act claim, the word ‘negligence’ is given a liberal interpretation that includes any breach of duty that an employer owes to his employees who are seamen.”) Federal maritime common law allows recovery of “maintenance” and “cure” to cover lost wages, medical costs, food, lodging, and other expenses. Johnson v. Cenac Towing, Inc., 599 F. Supp. 2d 721, 726 (E.D. La. 2009) (“The maritime employer’s duty of maintenance and cure, which dates at least to the medieval sea codes, obligates him to pay for the lost wages, medical care, food, lodging, and other incidental expenses of a mariner who falls ill or is injured while in the service of the vessel.”) (internal citation omitted). “The duty is practically absolute. Unlike an employer’s duty under the Jones Act, for example, liability for maintenance and cure is in no sense . . . predicated on the fault or negligence of the shipowner.” Id. (ellipses in original; internal quotations and citations omitted). B. The Crosby Tugs LLC LTD Benefits Plan and The Martin Resource LTD Plan Norman’s employer, Crosby Tugs LLC (“Crosby Tugs”), offered eligible employees LTD insurance through LINA under the terms of Crosby Tugs LLC Long Term Disability Benefits Plan (“the Crosby Tugs Plan”). The Crosby Tugs Plan provides that participants are entitled to certain benefits based on their earnings, subject to certain offsets for “Other Income Benefits.” Under the Crosby Tugs Plan, “Other Income Benefits” include any amounts received or assumed to be received: • “by the Employee or his or her dependents under any workers’ compensation, occupational disease, unemployment compensation law or similar state or federal Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 9 of 28 5 law payable for Injury or Sickness arising out of work with the Employer, including all permanent and temporary disability benefits. This includes any damages, compromises or settlement paid in place of such benefits, whether or not liability is admitted;” • under “any local, state, provincial or federal government disability or retirement plan or law payable for Injury or Sickness provided as a result of employment with the Employer;” or • “because of loss of earnings or earning capacity through settlement, judgment, arbitration or otherwise, where a third party may be liable, regardless of whether liability is determined.” See Declaration of Peter Shadzik (“Shadzik Decl.”) ¶ 3; Exhibit A, Crosby Tugs Group Disability Insurance Plan Documents, at 6-7. Further, the Crosby Tugs Plan delegates to LINA the discretion to interpret the Crosby Tugs Plan and make benefit determinations. See id. at 19.4 As alleged in the Amended Complaint, Maxson participated in a similar LTD plan (“the Martin Resource Plan”) sponsored by his employer, Martin Resource Management Corporation (“Martin Resource”). See Shadzik Decl. ¶ 4; Exhibit B, Martin Resource Group Disability Insurance Plan Documents. C. Rusty Norman In early 2013, Norman was injured twice in the course and scope of his employment with Crosby Tugs. See Am. Compl. ¶ 6. Shortly after sustaining his second injury in April 2013, Norman began receiving maintenance payments from Crosby Tugs. See id. ¶ 13.5 Norman submitted a claim for LTD benefits and, in February of 2014, LINA approved his claim, 4 The Plan Documents are properly considered by this Court, as they are both referred to in the Amended Complaint and central to Plaintiffs’ claims. See In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007); Perry v. Prudential Co. of Am., No. 11-559, 2012 WL 253403, at *3 n. 11 (M.D. La. Jan. 26, 2012) (collecting cases allowing for consideration of ERISA plan documents on motion to dismiss). 5 Except for one mention in their prayer for relief, Plaintiffs removed references to “cure” in their Amended Complaint and now allege simply that plaintiffs received “maintenance.” “Maintenance” versus “maintenance and cure” is a distinction without a difference. Plaintiffs’ attempt to differentiate “maintenance” from “maintenance and cure” does not change the fact that received payments for certain living expenses under maritime law. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 10 of 28 6 retroactive to October 2, 2013. In doing so, LINA applied an offset to those benefits, reducing them by the payments Norman received from Crosby Tugs. On October 15, 2014, Norman and Crosby Tugs entered into a settlement agreement with Crosby Tugs related to his injuries (the “Release”).6 Norman received $88,000 in the settlement, plus the $53,633.17 that had been paid to him previously. In the Release, Norman expressly released Crosby Tugs from any claims for “loss of wages in the past or future, medical treatment in the past and future, maintenance and cure in the past and future . . . .” Norman also released any claims under “the workers’ compensation laws of Louisiana, Pennsylvania, or the Federal laws of the United States, including but not limited to the Jones Act. . . .” Exhibit C, Release at 2. On December 16, 2015, Norman filed a lawsuit against Crosby Tugs and several of its affiliates related to his injuries. See Norman v. Crosby Tugs, LLC et al., Case No. 15-cv-06878- LMA-KWR, Dkt. 1. In his complaint, Norman specifically alleged claims under both the Jones Act and general maritime Law. See id., ¶ 2. Norman does not presently allege that he received any monies in that prior lawsuit, or that any offset was applied under the Crosby Tugs Plan for monies he received in that lawsuit.7 6 The settlement agreement is properly considered at this stage as it is central to and referenced in Plaintiffs’ Amended Complaint. Am. Compl. ¶ ¶ 13, 16. Moreover, the Court may take judicial notice of the Release, as it was publicly filed in Norman’s litigation with Crosby Tugs. Release, Norman v. Crosby Tugs, LLC, et al., Case No. 15- cv-06878-LMA-KWR, (E.D. La. Aug. 8, 2016), Dkt. 29-2. See Norris v. Hearst Trust, 500 F.3d 454, 461 n. 9 (5th Cir. 2007) (“it is clearly proper in deciding a 12(b)(6) motion to take judicial notice of matters of public record”); see also Simms v. Jones, Case No. 3:11-cv-0248-M, 2011 WL 5978594, at *2 (N.D. Tex. Nov. 30, 2011) (taking judicial notice of settlement agreement in considering motion to dismiss). 7 Nonetheless, the publicly filed settlement hearing transcript reveals that Norman recently settled the action for $25,000. Transcript of Settlement Hearing, Norman v. Crosby Tugs, LLC, et al., Case No. 15-cv-06878-LMA-KWR (E.D. La Oct. 5, 2016), Dkt. 38. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 11 of 28 7 Norman passed away on December 10, 2016. See Certificate of Death, Dkt. 6-2. As a result, he is no longer entitled to LTD benefits under the terms of the Crosby Tugs Plan on a going forward basis. Shadzik Decl. ¶ 3; Exhibit A, Crosby Tugs Group Disability Insurance Plan Documents at 10 (Benefits will end on “the date [the Employee] die[s].”). D. Weyman Maxson In November 2015, Maxson was injured in the course and scope of his employment with Martin Resource. Thereafter, Martin Resource began providing Maxson with maintenance payments pursuant to general maritime Law. See Am. Compl., ¶¶ 7, 13. Maxson submitted a claim to LINA for LTD benefits in connection with the injury, which LINA approved in May 2016, with benefits commencing effective May 3, 2016. LINA applied an offset reducing Maxson’s LTD benefits by the amount of his maintenance and cure payments. Maxson initiated an action under the Jones Act and maritime common law against Martin Resource on June 29, 2016 in the United States District Court for the Southern District of Alabama, Maxson v. Martin Resource Mgmt. Corp., Case No. 16-cv-00322-KD-C. At the time of the instant motion, Maxson’s lawsuit is still pending. The Amended Complaint in this case does not allege that Maxson received any money in his lawsuit against Martin Resource or that LINA has taken any offsets of any such money in connection with that lawsuit. Thus, as to Maxson, the only offset alleged is the one taken on the maintenance payments he received. III. PLAINTIFFS’ CLAIMS FAIL AS A MATTER OF LAW. Federal Rule of Civil Procedure 12(b)(6) allows for the dismissal where “the allegations in a complaint, however true, could not raise a claim of entitlement to relief[.]” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 558 (2007) (citations and internal quotation marks omitted). In so doing, the Court must accept Plaintiffs’ well-pled factual allegations as true, but it need not Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 12 of 28 8 accept any conclusory allegations or legal conclusions. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Importantly, where Plaintiffs “entitlement to relief hinges on the terms of the ERISA plan[s]” and the Plans are “referred to numerous times in [the Amended] Complaint,” the terms of that Plan are properly considered by the Court. Thomas v. Prudential Ins. Co. of Am., No. 14- 00747-BAJ-RLB, 2015 WL 2406036, at *2 (M.D. La. May 19, 2015). Here, the Plans are referred to in the Amended Complaint and integral to Plaintiffs’ claim that LINA improperly offset LTD benefits under the terms of the Plans and, therefore, are properly considered in connection with LINA’s motion. See Milton v. Blue Cross Blue Shield of Tex., Inc., No. 16-458, 2016 WL 2926846, at *2 (E.D. La. May 19, 2016) (in addition to the pleadings, “the Court may consider the terms of the healthcare benefits plan at issue because it is attached to the motion to dismiss, referred to in the petition, and central to plaintiff’s claims”); Am. Compl. ¶¶ 5, 10, 11, 12, 14, 16, 17. Because the offsets were permissible under the terms of the Plans, Plaintiffs’ claims fail as a matter of law. A. The Abuse of Discretion Standard Applies to LINA’s Decision to Offset Benefits. Where an ERISA plan vests its administrator with discretionary authority to construe the plan’s terms, the administrator’s decision to deny benefits will only be reversed upon a showing that it constituted abuse of discretion. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). Here, the Plans vest LINA with discretion to interpret the Plans and make any findings of fact under the Plans: The Plan Administrator has appointed [LINA] as the named fiduciary for adjudicating claims for benefits under the Plan, and for deciding any appeals of denied claims. [LINA] shall have the authority, in its discretion, to interpret the terms of the Plan, to Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 13 of 28 9 decide questions of eligibility for coverage or benefits under the Plan, and to make any related findings of fact. All decisions made by [LINA] shall be final and binding on Participants and Beneficiaries to the full extent permitted by law. See Shadzik Decl. ¶ 3; Exhibit A, Crosby Tugs Group Disability Insurance Plan Documents at 19. Accordingly, LINA’s decisions to apply the offsets are reviewed under the abuse of discretion standard.8 B. Norman’s and Maxson’s LTD Benefits Were Properly Subject to Offset. 1. Norman’s LTD Benefits Were Properly Offset Under The Crosby Tugs Plan. Norman’s LTD benefits were properly subject to offset under the Crosby Tugs Plan. As an initial matter, reductions of disability benefits to reflect the receipt of other income are standard provisions in ERISA disability plans and are commonly allowed by the Courts. See, e.g., House v. Am. United Life Ins. Co., No. Civ. A 02-1342, 2003 WL 21243502 (E.D. La. May 23, 2003). The plain terms of the Plans provide for a reduction of Other Income Benefits here. Norman also admits in the Amended Complaint that he received maintenance payments from Crosby Tugs, as well as additional monies pursuant to a broad settlement agreement with Crosby Tugs. He nevertheless argues that his LTD benefits are not subject to offset because the Jones Act is not “similar” to workers’ compensation. There are three problems with this argument. 8 While Plaintiff Norman alleges that LINA is bound by the “mend the hold” doctrine to certain representations that it allegedly made to him, see Am. Compl. ¶ 18, the Fifth Circuit has neither “adopted this position” nor applied the mend the hold doctrine “with regard to insurance cases[.]” Fed. Ins. Co. v. Infoglide Corp., No. A-05-CA-189- AWA, 2006 WL 2050694, at *10 (W.D. Tex. July 18, 2006). Further, Plaintiff Maxson does not allege any representations made to him about his offset. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 14 of 28 10 First, Norman ignores the Crosby Tugs Plan’s other offset provisions. The Crosby Tugs Plan has a separate offset for monies received under any “law payable for Injury or Sickness provided as a result of employment with the Employer.” See Shadzik Decl. ¶ 3; Exhibit A, Crosby Tugs Group Disability Insurance Plan Documents, at 6. That offset does not mention workers’ compensation, let alone require that the offset only apply to laws that are “similar to” workers’ compensation. Both federal maritime common law and the Jones Act fall within that offset. See Chandris, Inc. v. Latsis., 515 U.S. 347, 354 (1995) (“The Jones Act provides a cause of action in negligence for “any seaman” injured “in the course of his employment.”); In re Maryland Marine, Inc., 641 F. Supp. 2d 579, 584 (E.D. La. 2009) (“Maritime employers’ obligation of maintenance and cure has been part of maritime law for centuries.”) (emphasis added). Likewise, the Crosby Tugs Plan includes an offset for payments received “because of loss of earnings or earning capacity through settlement, judgment, arbitration or otherwise, where a third party may be liable, regardless of whether liability is determined.” See Shadzik Decl. ¶ 3; Exhibit A, Crosby Tugs Group Disability Insurance Plan Documents at 7. Again, this offset applies to claims under both maritime law and the Jones Act. See Daigle v. L & L Marine Trans. Co., 322 F. Supp. 2d 717, 730 (E.D. La. 2004) (“Under the Jones Act and general maritime law, monetary recovery is allowed for loss of earning capacity… resulting from an injury caused by negligence”); Coats v. Penrod Drilling Corp., 61 F.3d 1113, 1134 (5th Cir. 1995) (“The doctrine of joint and several liability is crystallized in the Jones Act context”). Second, the payments Norman received are subject to offset under the very “workers’ compensation” offset provision cited in the Amended Complaint. It is true – as Norman argues – that the Fifth Circuit has in certain circumstances held that the Jones Act is not “similar” to workers’ compensation. Amerisure Ins. Co. v. Navigators Ins. Co., 611 F.3d 299, 310 (5th Cir. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 15 of 28 11 2010). The Court based its holding on the fact that the Jones Act requires some proof of negligence whereas workers’ compensation does not. Id. This argument, however, is a red herring. Norman alleges that he received maintenance payments “pursuant to the general maritime law.” Am. Compl. ¶ 16. Maintenance under maritime law is similar to workers’ compensation because it does not require any proof of negligence. Davis v. Odeco, Inc., 18 F.3d 1237, 1246 (5th Cir. 1994) (“The owner of a vessel has a duty to pay maintenance and cure which is unrelated to any duty of care under tort law”). Indeed, the Fifth Circuit has specifically held that maritime common law, including maintenance, is “[e]ssentially a form of workers’ compensation-like employee benefit” with “no counterpart . . . in the Jones Act.” Guevara, 34 F.3d at 1284 (emphasis added). See also Abogado, 890 F. Supp. at 630 (holding that claims for maintenance is “similar to worker’s compensation”). Likewise, Norman’s settlement with Crosby Tugs entitled him to certain payments in exchange for releasing all claims he had for “loss of wages in the past and future, medical treatment in the past and future, maintenance and cure in the past and future . . . .” Release, Norman v. Crosby Tugs, LLC et al., Case No. 15-cv-06878-LMA-KWR, Dkt. 29-2 at 2; see also Am. Compl. ¶ 13. These are remedies available under maritime common law – again, similar to workers’ compensation. And for avoidance of any doubt, Norman also released any claims under “the workers’ compensation laws of Louisiana, Pennsylvania, or the Federal laws of the United States, including but not limited to the Jones Act. . . .” Exhibit C, Release at 2. Thus, Norman received these monies in exchange for releasing claims under any workers’ compensation law, or Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 16 of 28 12 for maintenance and cure, etc. As such, the settlement money he received is subject to offset under the Crosby Tugs Plan.9 2. Maxson’s LTD Benefits Were Properly Offset Under The Martin Resource Plan. Maxson does not allege that he ever filed a Jones Act claim or received any money pursuant to a Jones Act claim. Instead, he alleges only that he received maintenance payments from Martin Resource and that those maintenance payments were subject to offset. Am. Compl. ¶ 14.10 As explained above, maintenance (along with cure) is a federal maritime claim that does not require proof of negligence and is similar to workers’ compensation. Guevara, 34 F.3d at 1284 (maintenance and cure is “[e]ssentially a form of workers’ compensation-like employee benefit” with “no counterpart … in the Jones Act”); Abogado, 890 F. Supp. at 630 (maintenance and cure “are similar to worker’s compensation”). As such, Maxson’s benefits are subject to offset under each of the three offset provisions described above. His claim should be dismissed. IV. THE CLASS ALLEGATIONS SHOULD BE STRICKEN BECAUSE THE AMENDED COMPLAINT, ON ITS FACE, FAILS TO SATISFY THE REQUIREMENTS OF RULE 23. Should the Court deny LINA’s motion to dismiss, LINA respectfully submits that Plaintiffs’ class allegations should be stricken because the Amended Complaint shows that Plaintiffs cannot satisfy the requirements of Rule 23. Rule 23(c)(1)(A) provides that “the court 9 Norman subsequently filed a lawsuit against Crosby Tugs under both the Jones Act and general maritime law. Norman v. Crosby Tugs LLC, et al. Case No. 15-cv-06878-LMA-KWR. Norman does not allege that he received any money in that lawsuit, or that any offset was applied under the Crosby Tugs Plan with respect to that lawsuit. 10 Maxson recently filed a lawsuit against Martin Resource asserting claims under the Jones Act and General Maritime Law. To LINA’s knowledge, that lawsuit has not been resolved. Importantly, Maxson does not allege that he received any money in that lawsuit or that LINA applied an offset under the Martin Resource Plan for any money received in that lawsuit. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 17 of 28 13 must determine” whether to certify a class action “[a]t an early practicable time.” It is well- settled that “a court can strike class allegations ‘where a complaint fails to plead the minimum facts necessary to establish the existence of a class satisfying Rule 23’s mandate.’” Paternostro v. Choice Hotel Int’l Servs. Corp., 309 F.R.D. 397, 402 (E.D. La. 2015). Because courts apply “the same standard in ruling on a motion to strike . . . as in determining a motion to dismiss under Rule 12(b)(6),” id., merely reciting the elements of Rule 23 in a complaint, as Plaintiffs do here (see Am. Compl. ¶¶ 22-29), is not sufficient to state a plausible claim.11 The Court should strike Plaintiffs’ class allegations on this basis alone. Further, a court may strike or dismiss class allegations if, on the face of the complaint, it is apparent the plaintiff cannot satisfy the requirements of Rule 23. Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 160 (1982) (“Sometimes the issues are plain enough from the pleadings to determine whether the interests of the absent parties are fairly encompassed within the named plaintiff’s claim”); John v. Nat’l Sec. Fire & Cas. Co., 501 F.3d 443, 445 (5th Cir. 2007) (dismissing class allegations where there was no ascertainable class, and the need for individualized inquiries for claims of fraud and breach of contract were “facially apparent from the pleadings”). It is Plaintiffs’ burden to demonstrate that Rule 23’s prerequisites are satisfied. See, e.g., Unger v. Amedisys Inc., 401 F.3d 316, 320 (5th Cir. 2005) (“The party seeking certification bears the burden of establishing that all requirements of Rule 23 have been satisfied.”). Under Rule 23(b)(3), Plaintiffs must show that: (1) the class is sufficiently defined and clearly ascertainable, 11 However, should the Court deny LINA’s motion to strike and subsequently proceed to a class certification hearing, LINA reserves its right to challenge any request for class certification on the full range of substantive grounds – including but not limited to the numerosity, commonality, typicality, and adequacy of representation requirements of Rule 23(a) – with evidentiary submissions as may be appropriate. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 18 of 28 14 DeBremaecker v. Short, 433 F.2d 733 (5th Cir. 1970); (2) common questions of law or fact predominate over individualized issues (“predominance”); and (3) class resolution is superior to other methods for efficiently and fairly adjudicating the controversy (“superiority”).12 Unger, 401 F.3d at 320. Under the facts as pled, Plaintiffs cannot carry their burden as to any of these prerequisites and, therefore, dismissal of the class allegations is appropriate.13 A. The Proposed Class Is Neither Adequately Defined Nor Ascertainable. A threshold requirement to maintain a class action under Rule 23 is that the class “‘sought to be represented must be adequately defined and clearly ascertainable.’” Bauer v. Dean Morris, L.L.P., Nos. 08-5013, 08-5014, 2011 WL 3924963, at *3 (E.D. La. Sept. 7, 2011); (quoting DeBremaecker, 433 F.2d at 733); see also John, 501 F.3d at 445 (“The existence of an ascertainable class of persons to be represented by the proposed class representative is an implied prerequisite of” Rule 23). Courts within the Fifth Circuit have rejected class allegations where, as here, it would take individualized inquiries just to ascertain who meets the class definition. In John, for example, the plaintiffs proposed a class defined as insureds “who have damage or loss that indicates the involvement of more than one trade in order for that plaintiff to recover profit and overhead for a general contractor.” John v. Nat'l Sec. Fire & Cas. Co., No. 06-1407, 2006 WL 3228409, at *4 (W.D. La. Nov. 3, 2006), aff’d, 501 F.3d 443 (5th Cir. 2007). The court struck the class allegations because simply ascertaining which insureds would be members of the class 12 These are in addition to the numerosity, commonality, typicality, and adequacy required under Rule 23(a). Those issues are not separately addressed herein. 13 Aside from Rule 23, courts may also strike class allegations under the authority of Rules 12(b)(6) or 12(f). See, e.g., John, 501 F. 3d at 444-45 (affirming dismissal of class allegations under Rule 12(b)(6)); Waters v. Electrolux Home Prods., Inc., 2016 WL 3926431, at *4-6 (N.D. W. Va. July 18, 2016) (striking class allegations under Rule 12(f)); Sanders v. Apple Inc., 672 F. Supp. 2d 978, 990-91 (N.D. Cal. 2009) (same). LINA requests dismissal on these alternative grounds should the Court determine either to be a more appropriate basis. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 19 of 28 15 would require factual inquiries into whether each putative class member had damages involving more than one trade, and whether needing more than one trade contractor warranted a general contractor. Id. Courts have also dismissed class allegations when ascertaining who is a class member requires asking the very questions that the plaintiffs seek to have the court resolve on the merits. In Bauer, the proposed class definition was, in relevant part, “Louisiana residents . . . who were charged excessive fees[.]” 2011 WL 3924963, at *3. The court found that determining who fell within that definition would “require ascertaining whether [defendants] had in fact charged that individual excessive fees or expenses[,]” which would itself necessitate a review of the merits of each individual’s claim. Id. “The need to conduct such individual inquiries to determine who qualifies as a member of the class undermines the administrative benefits of Rule 23.” Id. (granting motions to strike and dismissing class claims with prejudice). Here, Plaintiffs’ proposed class is neither well-defined nor clearly ascertainable. They propose a class of individuals across the United States: who are or were covered or insured by Defendant under a group short-term disability and/or long-term disability policy issued by Life Insurance Company of North America whose long or short- term disability benefit was reduced by the insured employee’s receipt of maintenance paid under the general maritime law and/or by advances/credits and/or lump sum recoveries under the Jones Act, paid by their employer within the last ten (10) years. Am. Compl. ¶ 21 (emphasis added). Putting aside that this proposed definition is not limited to participants in any one particular plan – or even plans with particular language – Plaintiffs would require the Court to go through an individualized analysis to even evaluate whether each person meets the class definition, including but not limited to: Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 20 of 28 16 • Did the person receive monies from his or her employer or some other party that were used to offset disability benefits? • For each payment received by the person, why were the monies paid? This can be a subjective or objective inquiry, depending on the circumstances of the payment. For example: • What was the person’s job? Was it a job that entitled them to workers’ compensation in the event of an injury, or to pursue maritime common law claims, or Jones Act claims, or perhaps the job was unclear and may have entitled them to pursue all three? (This is not merely a theoretical; obviously, Norman agreed to release claims under all three in exchange for the payments he received). • Was there a court judgment finding that the payment was due under the Jones Act or maritime common law, or something else? • Was the payment made in exchange for a settlement agreement, such that the terms of the settlement agreement must be reviewed to determine whether the person falls within the class definition? • Is there some other basis for determining whether the payments received by the person constitute “maintenance” under general maritime law? • Is there some other basis for determining whether the payments received constitute an advance or credit or lump sum payment under the Jones Act? Of course, Plaintiffs might prefer for the Court to just accept their own characterization of the payments they personally received (as alleged in the Amended Complaint), but that too would require an individualized inquiry from each class member as to why he believed he received the payments he did. In short, there is no basis – aside from holding individualized trials about the circumstances of each payment received by each person – for even determining who is in the class. B. Individual Issues Predominate Over Common Questions. Even if the proposed class were adequately defined and ascertainable, Plaintiffs would still need to show that questions of law or fact common to the putative class members predominate over questions affecting individual members. They cannot. The predominance Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 21 of 28 17 requirement is “‘far more demanding’” than the commonality requirement of Rule 23(a), “because it ‘tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation.’” Steering Comm. v. Exxon Mobil Corp., 461 F.3d 598, 601-02 (5th Cir. 2006) (quoting Unger, 401 F.3d at 320). Courts within the Fifth Circuit have routinely found that the predominance requirement cannot be met in cases involving insurance policies because of the highly individualized nature of payments made (or not made) to insureds under the policies. For example, in In re Katrina Canal Breaches Litigation, 401 F. App’x 884, 886 (5th Cir. 2010), at issue was whether insurance companies made bad-faith adjustments to the plaintiffs’ hurricane-related insurance claims. The Fifth Circuit affirmed the trial court’s determination that each claim turned on whether defendants acted reasonably in deciding to make payments to each individual plaintiff, which would require “a fact-specific inquiry that will vary based on the individualized circumstances of each claim.” Id. at 886-87.14 Similarly, in Aguilar v. Allstate Fire & Cas. Ins. Co., No. 06-4660, 2007 WL 734809, at *3 (E.D. La. Mar. 6, 2007), the court granted the defendant’s motion to strike class allegations, finding that while the defendant’s general internal claims adjustment policies arguably were one common issue of fact, demonstrating a wrongful pattern and practice of failing to adjust claims will require an intensive review of the individual facts of each class member’s damage claim, including the nature and extent of damage, the timing and adjustment of each class member’s claim, how much each class member was paid for his claim and for what damage, and whether that amount was sufficient and timely. On the face of the pleading, it is clear that those individualized and highly personal issues pertaining to each class member patently 14 Individual issues included “the nature and extent of a class member’s damage, whether and how much a class member was paid and for what type of damage, and whether any payment was sufficient and timely.” Id. at 887. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 22 of 28 18 overwhelm any arguably common issues, rendering the claims inappropriate for class treatment. Id.15 Plaintiffs’ class allegations suffer the same flaws. The highly individualized facts pled by each Plaintiff in the Amended Complaint foreshadows the individual issues of every putative class member that will predominate in this litigation. Norman alleges that he received some maintenance payments under general maritime law as well as settlement monies paid in exchange for a broad release of claims, including claims for wages, workers’ compensation, general maritime law, and the Jones Act, among others. Three different provisions of the Crosby Tugs Plan apply to offsets made to Norman’s disability benefits. And further highlighting the individualized nature of the inquiry, Norman specifically alleges that he communicated with a LINA analyst who allegedly made specific representations to him regarding the offset to his benefits that bears on the merits of his personal claims. See Am. Compl. ¶ 19. On the other hand, Maxson’s only alleged offset is due to maintenance payments he received. Three provisions of a different plan – the Martin Resource Plan – apply to the offset. There are no alleged representations made to Maxson about his offset. And while not pled in the Amended Complaint, it is a matter of public record that Maxson is currently engaged in a lawsuit against his employer involving maritime law and the Jones Act that could eventually affect the 15 See also, e.g., Nguyen, 2008 WL 4691685, at *7 (predominance requirement not met because plaintiffs’ claim “is an adjustment dispute that is inappropriate for class certification”); Henry v. Allstate Ins. Co., 2007 WL 2287817, *4 (E.D. La. 2007) (striking class allegations that defendant artificially depressed claim values with intent to underpay insureds’ claims because “proving a questionable pattern and practice of undervaluing claims will require an intensive review of the individual facts of each class member’s damage claim”); Spiers v. Liberty Mut. Fire Ins. Co., 2006 WL 4764430, *2 (E.D. La. 2006) (striking class allegations alleging a pattern and practice of bad faith and improper claims handling because “individual questions pertaining to each class member overwhelm any arguably common issues”). Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 23 of 28 19 outcome of his current claims against LINA. See supra p. 7.16 And the representations made to Norman (Am. Compl. ¶ 19) are irrelevant to Maxson’s claim, or the claims of any other putative class member. In fact, to the extent that representations made to Norman are relevant to his claim (as he apparently believes), that is another individualized inquiry precluding class treatment. C. Class Resolution Would Not Be Superior to Other Available Methods. Plaintiffs likewise cannot meet the superiority requirement, which requires them to “show that the class action device would be better than, and not just equal to, other methods of adjudication.” Barasich v. Shell Pipeline Co., LP, No. 05-4180, 2008 WL 6468611, at *5 (E.D. La. June 19, 2008) (citation and editing marks omitted); see also Fed. R. Civ. P. 23(b)(3). A class action is not superior “for the fair and efficient adjudication of [a] controversy” where, as here, there are “variables that are pertinent to each individual member[,]” and when individual issues would ultimately lead to an “extensive and confusing trial[.]” Duvio v. Viking Range Corp., No. 12-1430, 2013 WL 1180948, at *7 (E.D. La. Mar. 20, 2013) (granting motion to strike class allegations); see also Bevrotte v. Caesars Entm’t Corp., No. 11-543, 2011 WL 4634174, at *5 (E.D. La. Oct. 4, 2011) (when “issues of causation and damages are highly individualized, superiority is wanting”) (citation and editing marks omitted); In re FEMA Trailer Formaldehyde Prods. Liab. Litig., 2008 WL 5423488, at *15 (E.D. La. 2008) (“the predominance of the individual issues present . . . detract[s] from the superiority of the class action device”). 16 None of the parties currently knows whether Maxson will prevail in that lawsuit under maritime law or the Jones Act (or both), or whether Maxson will dismiss that lawsuit as part of an agreement in which he receives additional monies in exchange for a release of claims. And of course, Maxson’s release could be very different from Norman’s. Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 24 of 28 20 Here, individual issues would overwhelm any class-wide questions, resulting in mini trials that would require a review of: • documentary review of each putative class member’s plan terms, release or other settlement agreements, third party lawsuits, resolutions of such lawsuits, documents explaining why the payments were made that were subject to offset; and • testimonial evidence specific to each putative class member about representations made to individual (to address Plaintiffs’ “mend the hold” argument), the factual circumstances leading to each putative class member’s injury and job duties (to determine whether the person could have pursued a workers’ compensation claim, a maritime common law claim, a Jones Act claim, or some combination of the above), the reasons for the payments that were subject to offset (i.e., were they because of the Jones Act, maritime common law, workers’ compensation, or some other reason or combination of reasons), and who made those payments (whether it is the employer or some other third party). This testimony is not limited to the putative class members themselves, but also would include representatives of the employer and others with knowledge about any of these issues. On the face of the Amended Complaint, it is obvious that a class action would not be a superior method of adjudicating Plaintiffs’ claims and, therefore, the Court should strike Plaintiffs’ class allegations. V. CONCLUSION For the reasons stated herein, Defendant respectfully requests that the Amended Complaint be dismissed with prejudice. In the alternative, Defendant requests that the class allegations be stricken with prejudice. Dated: March 24, 2017 Respectfully submitted, LIFE INSURANCE COMPANY OF NORTH AMERICA By: /s/ Peter Shadzik One of Its Attorneys JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 25 of 28 21 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: 504-846-8464 Fax: 800-977-8810 lwelch@mcsalaw.com Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 26 of 28 CERTIFICATE OF SERVICE I hereby certify that on March 24, 2017 a copy of the foregoing pleading was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Peter Shadzik JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: 504-846-8464 Fax: 800-977-8810 lwelch@mcsalaw.com Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 27 of 28 2 Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26-1 Filed 03/24/17 Page 28 of 28 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA RUSTY NORMAN and WEYMAN MAXSON, on behalf of themselves and all others similarly situated, Plaintiffs, vs. LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant. * * * * * * * * * * * * Case No. 2:16-cv-17271 Judge: Ivan L.R. Lemelle Magistrate Judge: Joseph C. Wilkinson, Jr. DECLARATION OF PETER SHADZIK I, Peter Shadzik, hereby certify pursuant to 28 U.S.C. § 1746 that the factual statements set forth below are true and correct to the best of my knowledge, information and belief: 1. I am an attorney at law and am an associate in the law firm of Morgan, Lewis & Bockius LLP. I am an attorney of record for Defendant Life Insurance Company of North America. The facts stated herein are within my personal knowledge and if called to testify, I could and would competently do so as set forth herein. 2. I make this declaration for the purpose of submitting copies of relevant documents received from Defendant in support of Defendant’s Memorandum of Law in Support of its Motion to Dismiss and Motion to Strike Class Allegations. 3. Attached hereto as Exhibit A are true and correct copies of Group Insurance Disability Plan Documents for Crosby Tugs, LLC. 4. Attached hereto as Exhibit B are true and correct copies of Group Insurance Disability Plan Documents for Martin Resource Management Corporation. Case 2:16-cv-17271-ILRL-JCW Document 26-2 Filed 03/24/17 Page 1 of 2 2 5. Attached hereto as Exhibit C is a true and correct copy of the Receipt, Release and Hold Harmless Agreement entered into between Rusty Norman and Crosby Tugs, LLC on October 15, 2014, as publicly filed in Norman v. Crosby Tugs, LLC et al., Case No. 15-cv- 06878-LMA-KWR. I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on March 24, 2017 /s/ Peter Shadzik Peter Shadzik Case 2:16-cv-17271-ILRL-JCW Document 26-2 Filed 03/24/17 Page 2 of 2 EXHIBIT A Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 1 of 75 Group Disability Insurance Certificate Crosby Tugs, LLC Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 2 of 75 IMPORTANT NOTICES If you reside in one of the following states, please read the important notices below: Arizona, Florida and Maryland residents: The group policy is issued in the state of Louisiana and will be governed by its laws. If you reside in a state other than Louisiana, this certificate of insurance may not provide all of the benefits and protections provided by the laws of your state. PLEASE READ YOUR CERTIFICATE CAREFULLY. Texas residents: IMPORTANT NOTICE: To obtain information or make a complaint: You may call the toll-free telephone number for information or to make a complaint at 1-800-547- 5515. You may contact the Texas Department of Insurance to obtain information on companies, coverages, rights or complaints at 1-800-252-3439. You may write the Texas Department of Insurance: P O Box 149091 Austin, TX 78714-9104 FAX # (512) 475-1771 PREMIUM OR CLAIM DISPUTES: Should you have a dispute concerning your premium or about a claim you should contact the agent or company first. If the dispute is not resolved, you may contact the Texas Department of Insurance. AVISO IMPORTANTE: Para solicitar información o presentar una queja: Usted puede llamar al numero de telefono gratis para información o pare someter una queja al 1-800- 547-5515. Puede comunicarse con el Departamento de Seguros de Texas para obtener información sobre compañías, coberturas, derechos o quejas llamando al 1-800-252-3439. También puede escribir al Texas Department of Insurance (Departamento de Seguros de Texas): P O Box 149091 Austin, TX 78714-9104 FAX: (512) 475-1771 CONFLICTOS POR PRIMAS O RECLAMACIONES: En caso de tener un conflicto relacionado con su prima o una reclamación, debe comunicarse primero con el agente o la compañía. Si el conflicto no se resuelve, usted puede comunicarse con el Departamento de Seguros de Texas. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 3 of 75 FOREWORD Disability insurance provides individuals and their families with financial protection. The Disability Insurance Benefit described in this booklet will help secure your family's financial security in the event of your disability. The need for disability insurance protection depends on individual circumstances and financial situations. Your Employer is offering you the opportunity to purchase this insurance to make your benefit program more comprehensive and responsive to your needs. The following pages describe the main provisions of the group disability insurance plan available to you. Any insurance benefit described in the following pages will apply to you only if you have elected that benefit and have authorized payroll deduction for the required premium. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 4 of 75 LIFE INSURANCE COMPANY OF NORTH AMERICA 1601 CHESTNUT STREET GROUP INSURANCE PHILADELPHIA, PA 19192-2235 CERTIFICATE (800) 732-1603 TDD (800) 336-2485 A STOCK INSURANCE COMPANY We, the LIFE INSURANCE COMPANY OF NORTH AMERICA, certify that we have issued a Group Policy, VDT-961002, to Crosby Tugs, LLC. We certify that we insure all eligible persons, who are enrolled according to the terms of the Policy. Your coverage will begin and end according to the terms set forth in this certificate. This certificate describes the benefits and basic provisions of your coverage. You should read it with care so you will understand your coverage. This is not the insurance contract. It does not waive or alter any of the terms of the Policy. If questions arise, the Policy will govern. You may examine the Policy at the office of the Policyholder or the Administrator. This certificate replaces any and all certificates which may have been issued to you in the past under the Policy. Matthew G. Manders, President TL-004704 O/O v-2 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 5 of 75 TABLE OF CONTENTS SCHEDULE OF BENEFITS........................................................................................................................ 1 WHO IS ELIGIBLE ..................................................................................................................................... 3 WHEN COVERAGE BEGINS .................................................................................................................... 3 WHEN COVERAGE ENDS ........................................................................................................................ 3 WHEN COVERAGE CONTINUES ............................................................................................................ 4 WHAT IS COVERED .................................................................................................................................. 6 WHAT IS NOT COVERED....................................................................................................................... 11 CLAIM PROVISIONS ............................................................................................................................... 11 ADMINISTRATIVE PROVISIONS.......................................................................................................... 13 GENERAL PROVISIONS ......................................................................................................................... 13 DEFINITIONS............................................................................................................................................ 14 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 6 of 75 1 SCHEDULE OF BENEFITS Policy Effective Date: November 1, 2011 Certificate Effective Date: January 1, 2012 Policy Anniversary Date: March 1 Policy Number: VDT-961002 Eligible Class Definition: All active, Full-time Employees of the Employer regularly working a minimum of 1560 hours per year. Eligibility Waiting Period If you were hired on or before the Policy Effective Date: The first of the month following the date of hire. If you were hired after the Policy Effective Date: The first of the month following the date of hire. Elimination Period The lesser of 180 days or the exhaustion of Short-term disability benefits Gross Disability Benefit The lesser of 60% of your monthly Covered Earnings rounded to the nearest dollar or your Maximum Disability Benefit. Maximum Disability Benefit $10,000 per month. Minimum Disability Benefit The greater of $100 or 10% of an Employee's Monthly Benefit prior to any reductions for Other Income Benefits. Disability Benefit Calculation The Disability Benefit payable to you is figured using the Gross Disability Benefit, Other Income Benefits and the Return to Work Incentive. Monthly Benefits are based on a 30-day month. The Disability Benefit will be prorated if payable for any period less than a month. During any month you have no Disability Earnings, the monthly benefit payable is the Gross Disability Benefit less Other Income Benefits. During any month you have Disability Earnings, benefits are determined under the Return to Work Incentive. Benefits will not be less than the minimum benefit shown in the Schedule of Benefits except as provided under the section Minimum Benefit. "Other Income Benefits" means any benefits listed in the Other Income Benefits provision that you receive on your own behalf or for your dependents, or which your dependents receive because of your entitlement to Other Income Benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 7 of 75 2 Return to Work Incentive During any month you have Disability Earnings, your benefits will be calculated as follows. Your monthly benefit payable will be calculated as follows during the first 24 months disability benefits are payable and you have Disability Earnings: 1. Add your Gross Disability Benefit and Disability Earnings. 2. Compare the sum from 1. to your Indexed Earnings. 3. If the sum from 1. exceeds 100% of your Indexed Earnings, then subtract the Indexed Earnings from the sum in 1. 4. Your Gross Disability Benefit will be reduced by the difference from 3., as well as by Other Income Benefits. 5. If the sum from 1. does not exceed 100% of your Indexed Earnings, your Gross Disability Benefit will be reduced by Other Income Benefits. After disability benefits are payable for 24 months, the monthly benefit payable is the Gross Disability Benefit reduced by Other Income Benefits and 50% of Disability Earnings. No Disability Benefits will be paid, and insurance will end if we determine you are able to work under a modified work arrangement and you refuse to do so without Good Cause. Maximum Benefit Period The later of your SSNRA* or the Maximum Benefit Period listed below. Age When Disability Begins Maximum Benefit Period Age 62 or under Your 65th birthday or the date the 42nd Monthly Benefit is payable, if later. Age 63 The date the 36th Monthly Benefit is payable. Age 64 The date the 30th Monthly Benefit is payable. Age 65 The date the 24th Monthly Benefit is payable. Age 66 The date the 21st Monthly Benefit is payable. Age 67 The date the 18th Monthly Benefit is payable. Age 68 The date the 15th Monthly Benefit is payable. Age 69 or older The date the 12th Monthly Benefit is payable. *SSNRA means the Social Security Normal Retirement Age in effect under the Social Security Act on the Policy Effective Date. TL-004774 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 8 of 75 3 WHO IS ELIGIBLE If you qualify under the Class Definition shown in the Schedule of Benefits you are eligible for coverage under the Policy on the Policy Effective Date, or the day after you complete the Eligibility Waiting Period, if later. The Eligibility Waiting Period is the period of time you must be in Active Service to be eligible for coverage. Your Eligibility Waiting Period will be extended by the number of days you are not in Active Service. Except as noted in the Reinstatement Provision, if you terminate your coverage and later wish to reapply, or if you are a former Employee who is rehired, you must satisfy a new Eligibility Waiting Period. You are not required to satisfy a new Eligibility Waiting Period if your insurance ends because you no longer qualify under your Class Definition, but you continue to be employed, and within one year you qualify again. TL-004710 WHEN COVERAGE BEGINS If you are required to contribute to the cost of your insurance you may elect to be insured only by authorizing payroll deduction in a form approved by the Employer and us. The effective date of your insurance depends on the date coverage is elected. If you elect coverage within 31 days after you become eligible or within 31 days after a Life Status Change, your insurance is effective on the latest of the following dates. 1. The Policy Effective Date. 2. The date you authorized payroll deduction. 3. The date the completed enrollment form is received by the Employer or us. If your enrollment form is received more than 31 days after you are eligible for insurance, the late entrant Pre-existing Condition Limitation provision will apply. If you are not in Active Service on the date your insurance would otherwise be effective, it will be effective on the date you return to any occupation for your Employer on a Full-time basis. TL-004712 WHEN COVERAGE ENDS Your coverage ends on the earliest of the following dates: 1. the date you are eligible for coverage under a plan intended to replace this coverage; 2. the date the Policy is terminated; 3. the date you are no longer in an eligible class; 4. the day after the end of the period for which premiums are paid; 5. the date you are no longer in Active Service; 6. the date benefits end because you did not comply with the terms and conditions of the insurance coverage. If you are entitled to receive Disability Benefits when the Policy terminates, Disability Benefits will be payable to you if you remain disabled and meet the requirements for the insurance. Any later period of Disability, regardless of cause, that begins when you are eligible under another disability coverage provided by any employer, will not be covered. TL-007505.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 9 of 75 4 WHEN COVERAGE CONTINUES This provision modifies the When Coverage Ends provision to allow insurance to continue under certain circumstances if you are no longer in Active Service. Insurance that is continued under this provision is subject to all other terms of the When Coverage Ends provisions. Your Disability Insurance will continue if your Active Service ends because of a Disability for which benefits under the Policy are or may become payable. Your premiums will be waived while Disability Benefits are payable. If you do not return to Active Service, this insurance ends when your Disability ends or when benefits are no longer payable, whichever occurs first. If your Active Service ends due to an approved leave pursuant to the Family and Medical Leave Act (FMLA), insurance will continue up to the later of the period of your approved FMLA leave or the leave period required by law in the state in which you are employed. Premiums are required for this coverage. If your Active Service ends due to Temporary Layoff, insurance will continue for you for up to 3 months. Premiums are required for this coverage. If an Employee’s Active Service ends due to any other leave of absence approved in writing by the Employer prior to the date the Employee ceases work, insurance will continue for an Employee for up to 3 months. Premiums are required for this coverage. An approved leave of absence does not include Furlough, Temporary Layoff or termination of employment. If your Active Service ends due to any other excused short term absence from work that is reported to the Employer timely in accordance with the Employer’s reporting requirements for such short term absence, your insurance will continue until the earlier of: a. the date your employment relationship with the Employer terminates; b. the date premiums are not paid when due; c. the end of the 30 day period that begins with the first day of such excused absence; d. the end of the period for which such short term absence is excused by the Employer. Notwithstanding any other provision of this policy, if your Active Service ends due to layoff, termination of employment or any other termination of the employment relationship, insurance will terminate and continuation of insurance under this provision will not apply. If your insurance is continued pursuant to this When Coverage Continues provision, and you become Disabled during such period of continuation, Disability Benefits will not begin until the later of the date the Elimination Period is satisfied or the date you are scheduled to return to Active Service. TL-004704.19 (TL-009970) Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 10 of 75 5 TAKEOVER PROVISION This provision applies to you only if you are eligible under this Policy and were covered for long term disability coverage on the day prior to the effective date of this Policy under the Prior Plan provided by the Policyholder or by an entity that has been acquired by the Policyholder. A. This section A applies to you if you are not in Active Service on the day prior to the effective date of this Policy due to a reason for which the Prior Plan and this Policy both provide for continuation of insurance. If required premium is paid when due, we will insure an Employee to which this section applies against a disability that occurs after the effective date of this Policy for the affected employee group. This coverage will be provided until the earlier of the date: (a) you return to Active Service, (b) continuation of insurance under the Prior Plan would end but for termination of that plan; or (c) the date continuation of insurance under this Policy would end if computed from the first day you were not in Active Service. The Policy will provide this coverage as follows: 1. If benefits for a disability are covered under the Prior Plan, no benefits are payable under this Plan. 2. If the disability is not a covered disability under the Prior Plan solely because the plan terminated, benefits payable under this Policy for that disability will be the lesser of: (a) the disability benefits that would have been payable under the Prior Plan; and (b) those provided by this Policy. Credit will be given for partial completion under the Prior Plan of Elimination Periods and partial satisfaction of pre-existing condition limitations. B. The Elimination Period under this Policy will be waived for a Disability which begins while you are insured under this Policy if all of the following conditions are met: 1. The Disability results from the same or related causes as a Disability for which monthly benefits were payable under the Prior Plan; 2. Benefits are not payable for the Disability under the Prior Plan solely because it is not in effect; 3. An Elimination Period would not apply to the Disability if the Prior Plan had not ended; 4. The Disability begins within 6 months of your return to Active Service and your insurance under this Policy is continuous from this Policy’s Effective Date. C. Except for any amount of benefit in excess of a Prior Plan's benefits, the Pre-existing Condition Limitation will not apply if you were covered under a Prior Plan and satisfied the pre-existing condition limitation, if any, under that plan. If you did not fully satisfy the pre-existing condition limitation of that plan, credit will be given for any time that was satisfied under the Prior Plan's pre- existing condition limitation. Benefits will be determined based on the lesser of: (1) the amount of the gross disability benefit under the Prior Plan and any applicable maximums; and (2) those provided by this Policy. If benefits are payable under the Prior Plan for the Disability, no benefits are payable under this Policy. TL-005108 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 11 of 75 6 DESCRIPTION OF BENEFITS WHAT IS COVERED Disability Benefits We will pay Disability Benefits if you become Disabled while covered under this Policy. You must satisfy the Elimination Period, be under the Appropriate Care of a Physician, and meet all the other terms and conditions of the Policy. You must provide to us, at your own expense, satisfactory proof of Disability before benefits will be paid. The Disability Benefit is shown in the Schedule of Benefits. We will require continued proof of your Disability for benefits to continue. Elimination Period The Elimination Period is the period of time you must be continuously Disabled before Disability Benefits are payable. The Elimination Period is shown in the Schedule of Benefits. A period of Disability is not continuous if separate periods of Disability result from unrelated causes. Disability Benefit Calculation The Disability Benefit Calculation is shown in the Schedule of Benefits. Monthly Disability Benefits are based on a 30 day period. They will be prorated if payable for any period less than a month. If you are working while Disabled, the Disability Benefit Calculation will be the Return to Work Incentive. Return to Work Incentive The Return to Work Incentive is shown in the Schedule of Benefits. You may work for wage or profit while Disabled. In any month in which you work and a Disability Benefit is payable, the Return to Work Incentive applies. We will, from time to time, review your status and will require satisfactory proof of earnings and continued Disability. Minimum Benefit We will pay the Minimum Benefit shown in the Schedule of Benefits despite any reductions made for Other Income Benefits. The Minimum Benefit will not apply if benefits are being withheld to recover an overpayment of benefits. Other Income Benefits If Disability Benefits are payable to you under this Policy, you may be eligible for benefits from Other Income Benefits. If so, we may reduce the Disability Benefits by the amount of such Other Income Benefits. Other Income Benefits include: 1. any amounts received (or assumed to be received*) by you or your dependents under: - the Canada and Quebec Pension Plans; - the Railroad Retirement Act; - any local, state, provincial or federal government disability or retirement plan or law payable for Injury or Sickness provided as a result of employment with the Employer; - any sick leave or salary continuation plan of the Employer; - any work loss provision in mandatory "No-Fault" auto insurance. 2. any Social Security disability or retirement benefits you or any third party receive (or are assumed to receive*) on your own behalf or for your dependents; or which your dependents receive (or are assumed to receive*) because of your entitlement to such benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 12 of 75 7 3. any Retirement Plan benefits funded by the Employer. "Retirement Plan" means any defined benefit or defined contribution plan sponsored or funded by the Employer. It does not include an individual deferred compensation agreement; a profit sharing or any other retirement or savings plan maintained in addition to a defined benefit or other defined contribution pension plan, or any employee savings plan including a thrift, stock option or stock bonus plan, individual retirement account or 40l(k) plan. 4. any proceeds payable under any franchise or group insurance or similar plan. If other insurance applies to the same claim for Disability, and contains the same or similar provision for reduction because of other insurance, we will pay for our pro rata share of the total claim. "Pro rata share" means the proportion of the total benefit that the amount payable under one policy, without other insurance, bears to the total benefits under all such policies. 5. any amounts received (or assumed to be received*) by you or your dependents under any workers' compensation, occupational disease, unemployment compensation law or similar state or federal law payable for Injury or Sickness arising out of work with the Employer, including all permanent and temporary disability benefits. This includes any damages, compromises or settlement paid in place of such benefits, whether or not liability is admitted. 6. any amounts paid because of loss of earnings or earning capacity through settlement, judgment, arbitration or otherwise, where a third party may be liable, regardless of whether liability is determined. Dependents include any person who receives (or is assumed to receive*) benefits under any applicable law because of your entitlement to benefits. *See the Assumed Receipt of Benefits provision. Increases in Other Income Benefits Any increase in Other Income Benefits during a period of Disability due to a cost of living adjustment will not be considered in calculating your Disability Benefits after the first reduction is made for any Other Income Benefits. This section does not apply to any cost of living adjustment for Disability Earnings. Lump Sum Payments Other Income Benefits or earnings paid in a lump sum will be prorated over the period for which the sum is given. If no time is stated, the lump sum will be prorated over five years. If no specific allocation of a lump sum payment is made, then the total payment will be an Other Income Benefit. Assumed Receipt of Benefits We will assume you (and your dependents, if applicable) are receiving benefits for which you are eligible from Other Income Benefits. We will reduce your Disability Benefits by the amount from Other Income Benefits we estimate are payable to you and your dependents. We will waive Assumed Receipt of Benefits, except for Disability Earnings for work you perform while Disability Benefits are payable, if you: 1. provide satisfactory proof of application for Other Income Benefits; 2. sign a Reimbursement Agreement; 3. provide satisfactory proof that all appeals for Other Income Benefits have been made unless we determine that further appeals are not likely to succeed; and 4. submit satisfactory proof that Other Income Benefits were denied. We will not assume receipt of any pension or retirement benefits that are actuarially reduced according to applicable law, until you actually receive them. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 13 of 75 8 Social Security Assistance We may help you in applying for Social Security Disability Income (SSDI) Benefits, and may require you to file an appeal if we believe a reversal of a prior decision is possible. We will reduce Disability Benefits by the amount we estimate you will receive, if you refuse to cooperate with or participate in the Social Security Assistance Program. Recovery of Overpayment We have the right to recover any benefits we have overpaid. We may use any or all of the following to recover an overpayment: 1. request a lump sum payment of the overpaid amount; 2. reduce any amounts payable under this Policy; and/or 3. take any appropriate collection activity available to us. The Minimum Benefit amount will not apply when Disability Benefits are reduced in order to recover any overpayment. If an overpayment is due when you die, any benefits payable under the Policy will be reduced to recover the overpayment. Successive Periods of Disability A separate period of Disability will be considered continuous: 1. if it results from the same or related causes as a prior Disability for which benefits were payable; and 2. if, after receiving Disability Benefits, you return to work in your Regular Occupation for less than 6 consecutive months; and 3. if you earn less than the percentage of Indexed Earnings that would still qualify you to meet the definition of Disability/Disabled during at least one month. Any later period of Disability, regardless of cause, that begins when you are eligible for coverage under another group disability plan provided by any employer will not be considered a continuous period of Disability. For any separate period of disability which is not considered continuous, you must satisfy a new Elimination Period. LIMITATIONS Limited Benefit Periods for Mental or Nervous Disorders We will pay Disability Benefits on a limited basis during your lifetime for a Disability caused by, or contributed to by, any one or more of the following conditions. Once 24 monthly Disability Benefits have been paid, no further benefits will be payable for any of the following conditions. 1) Anxiety disorders 2) Delusional (paranoid) disorders 3) Depressive disorders 4) Eating disorders 5) Mental illness 6) Somatoform disorders (psychosomatic illness) If, before reaching your lifetime maximum benefit, you are confined in a hospital for more than 14 consecutive days, that period of confinement will not count against your lifetime limit. The confinement must be for the Appropriate Care of any of the conditions listed above. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 14 of 75 9 Limited Benefit Periods for Alcoholism and Drug Addiction or Abuse We will pay Disability Benefits on a limited basis during your lifetime for a Disability caused by, or contributed to by, any one or more of the following conditions. Once 24 monthly Disability Benefits have been paid, no further benefits will be payable for any of the following conditions. 1) Alcoholism 2) Drug addiction or abuse If, before reaching your lifetime maximum benefit, you are confined in a hospital for more than 14 consecutive days, that period of confinement will not count against your lifetime limit. The confinement must be for the Appropriate Care of any of the conditions listed above. Pre-Existing Condition Limitation We will not pay benefits for any period of Disability caused or contributed to by, or resulting from, a Pre- existing Condition. A "Pre-existing Condition" means any Injury or Sickness for which you incurred expenses, received medical treatment, care or services including diagnostic measures, took prescribed drugs or medicines, or for which a reasonable person would have consulted a Physician within 3 months before your most recent effective date of insurance. The Pre-existing Condition Limitation will apply to any added benefits or increases in benefits. This limitation will not apply to a period of Disability that begins after you are covered for at least 12 months after your most recent effective date of insurance, or the effective date of any added or increased benefits. Pre-Existing Condition Limitation (For Late Entrants after the initial open enrollment or 31-day eligibility period) We will not pay benefits for any period of Disability caused or contributed to by, or resulting from, a Pre- existing Condition. A "Pre-existing Condition" means any Injury or Sickness for which you incurred expenses, received medical treatment, care or services including diagnostic measures, took prescribed drugs or medicines, or for which a reasonable person would have consulted a Physician within 12 months before your most recent effective date of insurance. The Pre-existing Condition Limitation will apply to any added benefits or increases in benefits. This limitation will not apply to a period of Disability that begins after you are covered for at least 24 months after your most recent effective date of insurance, or the effective date of any added or increased benefits. TL-007500.19 ADDITIONAL BENEFITS Rehabilitation During a Period of Disability If we determine that you are a suitable candidate for rehabilitation, we may require you to participate in a Rehabilitation Plan and assessment at our expense. We have the sole discretion to approve your participation in a Rehabilitation Plan and to approve a program as a Rehabilitation Plan. We will work with you, the Employer and your Physician and others, as appropriate, to perform the assessment, develop a Rehabilitation Plan, and discuss return to work opportunities. The Rehabilitation Plan may, at our discretion, allow for payment of your medical expense, education expense, moving expense, accommodation expense or family care expense while you participate in the program. If you fail to fully cooperate in all required phases of the Rehabilitation Plan and assessment without Good Cause, no Disability Benefits will be paid, and insurance will end. TL-007501.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 15 of 75 10 Conversion Privilege for Disability Insurance Benefits If an Employee’s insurance ends because employment with the Employer ends, or an Employee is laid off or on an uninsured leave of absence, he or she may be eligible for conversion insurance. To be eligible, an Employee must have been insured for Disability Benefits and actively at work for at least 12 straight months. An Employee must apply for conversion insurance within 62 days after insurance under this Policy ends or within 31 days of the date notice is given to apply for a converted policy or certificate, whichever is later. In no event will the conversion period be extended beyond 105 days from the date insurance ends. The benefits of the conversion plan will be those benefits offered at the time the Employee applies. The premium will be based on the rates in effect for conversion plans at that time. Conversion insurance is not available if any of the following conditions apply: 1. the Employee is retired or age 70 or older; 2. the Employee is not in Active Service because of Disability; 3. the Policy is canceled for any reason; 4. the Employee is no longer in a Class of Eligible Employees, but is still employed by the Employer. TL-009961.00 Survivor Benefit We will pay a Survivor Benefit if you die while Disability Benefits are payable to you for a continuous period of Disability. The Survivor Benefit will equal 100% of the sum of the last full Disability Benefit payable to you plus the amount of any Disability Earnings by which the benefit had been reduced for that month. A single lump sum payment equal to 3 monthly Survivor Benefits will be payable. We will pay the Survivor Benefit to your Spouse. If you do not have a Spouse, we will pay your surviving Children in equal shares. If you do not have a Spouse or any Children, we will pay your estate. "Spouse" means your lawful spouse. "Children" means your unmarried children under age 26 who are chiefly dependent upon you for support and maintenance. The term includes a stepchild living with you at the time of your death. TL-005107 TERMINATION OF DISABILITY BENEFITS Benefits will end on the earliest of the following dates: 1. the date you earn from any occupation, more than the percentage of Indexed Earnings set forth in the definition of Disability applicable to you at that time; 2. the date we determine you are not Disabled; 3. the end of the Maximum Benefit Period; 4. the date you die; 5. the date you refuse, without Good Cause, to fully cooperate in all required phases of the Rehabilitation Plan and assessment; 6. the date you are no longer receiving Appropriate Care; 7. the date you fail to cooperate with us in the administration of the claim. Such cooperation includes, but is not limited to, providing any information or documents needed to determine whether benefits are payable or the actual benefit amount due. Benefits may be resumed if you begin to cooperate fully in the Rehabilitation Plan within 30 days of the date benefits terminated. TL-007502.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 16 of 75 11 WHAT IS NOT COVERED We will not pay any Disability Benefits for a Disability that results, directly or indirectly, from: 1. suicide, attempted suicide, or self-inflicted injury while sane or insane. 2. war or any act of war, whether or not declared. 3. active participation in a riot. 4. commission of a felony. 5. the revocation, restriction or non-renewal of your license, permit or certification necessary to perform the duties of your occupation unless due solely to Injury or Sickness otherwise covered by the Policy. In addition, we will not pay Disability Benefits for any period of Disability during which you are incarcerated in a penal or corrections institution. TL-007503.00 CLAIM PROVISIONS Notice of Claim Written notice of claim, or notice by any other electronic/telephonic means authorized by us, must be given to us within 31 days after a covered loss occurs or begins or as soon as reasonably possible. If written notice, or notice by any other electronic/telephonic means authorized by us, is not given in that time, the claim will not be invalidated or reduced if it is shown that notice was given as soon as was reasonably possible. Notice can be given at our home office in Philadelphia, Pennsylvania or to our agent. Notice should include the Employer's name, the Policy Number and the claimant's name and address. Claim Forms When we receive notice of claim, we will send claim forms for filing proof of loss. If we do not send claim forms within 15 days after notice is received by us, the proof requirements will be met by submitting, within the time required under the "Proof of Loss" section, written proof, or proof by any other electronic/telephonic means authorized by us, of the nature and extent of the loss. Claimant Cooperation Provision If you fail to cooperate with us in our administration of your claim, we may terminate the claim. Such cooperation includes, but is not limited to, providing any information or documents needed to determine whether benefits are payable or the actual benefit amount due. Insurance Data The Employer is required to cooperate with us in the review of claims and applications for coverage. Any information we provide to the Employer in these areas is confidential and may not be used or released by the Employer if not permitted by applicable privacy laws. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 17 of 75 12 Proof of Loss You must provide written proof of loss to us, or proof by any other electronic/telephonic means authorized by us, within 90 days after the date of the loss for which a claim is made. If written proof of loss, or proof by any other electronic/telephonic means authorized by us, is not given in that 90 day period, the claim will not be invalidated nor reduced if it is shown that it was given as soon as was reasonably possible. In any case, written proof of loss, or proof by any other electronic/telephonic means authorized by us, must be given not more than one year after the 90 day period. If written proof of loss, or proof by any other electronic/telephonic means authorized by us, is provided outside of these time limits, the claim will be denied. These time limits will not apply due to lack of legal capacity. Written proof that the loss continues, or proof by any other electronic/telephonic means authorized by us, must be furnished to us at intervals we require. Within 30 days of a request, written proof of continued Disability and Appropriate Care by a Physician must be given to us. Time of Payment Disability Benefits will be paid at regular intervals of not less frequently than once a month. Any balance, unpaid at the end of any period for which we are liable, will be paid at that time. To Whom Payable Disability Benefits will be paid to you. If any person to whom benefits are payable is a minor or, in our opinion is not able to give a valid receipt, such payment will be made to his or her legal guardian. However, if no request for payment has been made by the legal guardian, we may, at our option, make payment to the person or institution appearing to have assumed custody and support. If you die while any Disability Benefits remain unpaid, we may, at our option, make direct payment to any of your following living relatives: your spouse, your mother, your father, your children, your brothers or sisters; or to the executors or administrators of your estate. We may reduce the amount payable by any indebtedness due. Payment in the manner described above will release us from all liability for any payment made. Physical Examination and Autopsy We may, at our expense, exercise the right to examine any person for whom a claim is pending as often as we may reasonably require. Also, we may, at our expense, require an autopsy unless prohibited by law. Legal Actions No action at law or in equity may be brought to recover benefits under the Policy less than 60 days after written proof of loss, or proof by any other electronic/telephonic means authorized by us, has been furnished as required by the Policy. No such action shall be brought more than 3 years after the time satisfactory proof of loss is required to be furnished. Time Limitations If any time limit stated in the Policy for giving notice of claim or proof of loss, or for bringing any action at law or in equity, is less than that permitted by the law of the state in which you live when the Policy is issued, then the time limit provided in the Policy is extended to agree with the minimum permitted by the law of that state. Physician/Patient Relationship You have the right to choose any Physician who is practicing legally. We will in no way disturb the Physician/patient relationship. TL-004724 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 18 of 75 13 ADMINISTRATIVE PROVISIONS Premiums The premiums for this Policy will be based on the rates currently in force, the plan and the amount of insurance in effect. Your Grace Period If your required premium is not paid on the Premium Due Date, there is a 31 day grace period after each premium due date after the first. If the required premium is not paid during the grace period, insurance will end on the last day for which premium was paid. Reinstatement of Insurance Your insurance may be reinstated if it ends because you are on an unpaid leave of absence. If your Active Service ended due to an approved leave pursuant to the Family and Medical Leave Act (FMLA) and Continuation of Insurance is not applicable, your insurance may be reinstated at the conclusion of the FMLA leave. If your Active Service ends due to an Employer approved unpaid leave of absence, other than an approved FMLA leave, insurance may be reinstated only: 1. If the reinstatement occurs within 12 weeks from the date insurance ends, or 2. When returning from military service pursuant to the Uniformed Services Employment Act of 1994 (USERRA). For insurance to be reinstated the following conditions must be met: 1. You must be in a Class of Eligible Employees. 2. The required premium must be paid. 3. We must receive a written request for reinstatement within 31 days from the date you return to Active Service. Reinstated insurance will be effective on the date you return to Active Service. If you did not fully satisfy the Eligibility Waiting Period or the Pre-Existing Condition Limitation (if any) before insurance ended due to an unpaid leave of absence, credit will be given for any time that was satisfied. TL-009960.00 GENERAL PROVISIONS Incontestability All statements made by the Employer or by an Insured are representations not warranties. No statement will be used to deny or reduce benefits or as a defense to a claim, unless a copy of the instrument containing the statement has been furnished to the claimant. In the event of death or legal incapacity, the beneficiary or representative must receive the copy. After two years from an Insured's effective date of insurance, or from the effective date of any added or increased benefits, no such statement will cause insurance to be contested except for fraud or eligibility for insurance. Misstatement of Age If an Insured's age has been misstated, we will adjust all benefits to the amounts that would have been purchased for the correct age. Workers' Compensation Insurance The Policy is not in lieu of and does not affect any requirements for insurance under any Workers' Compensation Insurance Law. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 19 of 75 14 Assignment of Benefits We will not be affected by the assignment of your certificate until the original assignment or a certified copy of the assignment is filed with us. We will not be responsible for the validity or sufficiency of an assignment. An assignment of benefits will operate so long as the assignment remains in force provided insurance under the Policy is in effect. This insurance may not be levied on, attached, garnisheed, or otherwise taken for a person's debts. This prohibition does not apply where contrary to law. Clerical Error A person's insurance will not be affected by error or delay in keeping records of insurance under the Policy. If such an error is found, the premium will be adjusted fairly. TL-004728 DEFINITIONS Please note, certain words used in this document have specific meanings. These terms will be capitalized throughout this document. The definition of any word, if not defined in the text where it is used, may be found either in this Definitions section or in the Schedule of Benefits. Active Service If you are an Employee, you are in Active Service on a day which is one of the Employer's scheduled work days if either of the following conditions are met. 1. You are performing your regular occupation for the Employer on a full-time basis. You must be working at one of the Employer's usual places of business or at some location to which the Employer's business requires you to travel. 2. The day is a scheduled holiday or vacation day and you were performing your regular occupation on the preceding scheduled work day. You are in Active Service on a day which is not one of the Employer's scheduled work days only if you were in Active Service on the preceding scheduled work day. Appropriate Care Appropriate Care means you: 1. Have received treatment, care and advice from a Physician who is qualified and experienced in the diagnosis and treatment of the conditions causing Disability. If the condition is of a nature or severity that it is customarily treated by a recognized medical specialty, the Physician is a practitioner in that specialty. 2. Continue to receive such treatment, care or advice as often as is required for treatment of the conditions causing Disability. 3. Adhere to the treatment plan prescribed by the Physician, including the taking of medications. Consumer Price Index (CPI-W) The Consumer Price Index for Urban Wage Earners and Clerical Workers published by the U.S. Department of Labor. If the index is discontinued or changed, another nationally published index that is comparable to the CPI-W will be used. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 20 of 75 15 Covered Earnings Covered Earnings means your earnings as figured from the W2 form (from the box that reflects wages, tips and other compensation for federal income tax purposes) received from the Employer for the calendar year just prior to the date the Disability begins. It includes overtime pay, but not bonuses, commissions or other extra compensation as reported by the Employer. If you were not employed by the Employer for the full year or no W-2 was received, it means your average monthly earnings from the Employer for the months employed. Covered Earnings are determined initially on the date an Employee applies for coverage. A change in the amount of Covered Earnings is effective on the Policy Anniversary following the change, if the Employer gives us written notice of the change and the required premium is paid. Overtime pay will be averaged for the 12 months just prior to the date your Disability begins, or for the months you are employed by the Employer, if less than 12 months. Any increase in your Covered Earnings will not be effective during a period of continuous Disability. Disability/Disabled You are considered Disabled if, solely because of Injury or Sickness, you are: 1. unable to perform the material duties of your Regular Occupation; or 2. unable to earn 80% or more of your Indexed Earnings from working in your Regular Occupation. After Disability Benefits have been payable for 24 months, you are considered Disabled if, solely due to Injury or Sickness, you are: 1. unable to perform the material duties of any occupation for which you are, or may reasonably become, qualified based on education, training or experience; or 2. unable to earn 80% or more of your Indexed Earnings. We will require proof of earnings and continued Disability. Disability Earnings Any wage or salary for any work performed for any employer during your Disability, including commissions, bonus, overtime pay or other extra compensation. Employee For eligibility purposes, you are an Employee if you work for the Employer and are in one of the "Classes of Eligible Employees." Otherwise, you are an Employee if you are an employee of the Employer who is insured under the Policy. Employer The Policyholder and any affiliates or subsidiaries covered under the Policy. The Employer is acting as your agent for transactions relating to this insurance. You shall not consider any actions of the Employer as actions of the Insurance Company. Full-time Full-time means the number of hours set by the Employer as a regular work day for Employees in your eligibility class. Furlough Furlough means a temporary suspension or alteration of Active Service initiated by the Employer, for a period of time specified in advance not to exceed 30 days at a time. Good Cause A medical reason preventing participation in the Rehabilitation Plan. Satisfactory proof of Good Cause must be provided to us. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 21 of 75 16 Indexed Earnings For the first 12 months Monthly Benefits are payable, your Indexed Earnings are equal to your Covered Earnings. After 12 Monthly Benefits are payable, your Indexed Earnings are your Covered Earnings plus an increase applied on each anniversary of the date Monthly Benefits became payable. The amount of each increase will be the lesser of: 1. 10% of your Indexed Earnings during your preceding year of Disability; or 2. the rate of increase in the Consumer Price Index (CPI-W) during the preceding calendar year. Injury Any accidental loss or bodily harm that results directly and independently from all other causes from an Accident. Insurability Requirement An eligible person satisfies the Insurability Requirement for an amount of coverage on the day we agree in writing to accept you as insured for that amount. To determine a person's acceptability for coverage, we will require you to provide evidence of good health and may require it be provided at your expense. Insurance Company The Insurance Company underwriting the Policy is named on your certificate cover page. References to the Insurance Company have been changed to "we", "our", "ours", and "us" throughout the certificate. Insured You are an Insured if you are eligible for insurance under the Policy, insurance is elected for you, the required premium is paid and your coverage is in force under the Policy. Life Status Change A Life Status Change is an event recognized by the Employer's Flexible Benefits Plan as qualifying you to make changes in benefit selections at a time other than an Annual Enrollment Period. If the Employer does not sponsor a Flexible Benefits Plan or if it is no longer in effect, the following events are Life Status Changes. 1. Marriage 2. Divorce, annulment or legal separation 3. Birth or adoption of a child 4. Death of your spouse 5. Termination of your spouse's employment 6. A change in the benefit plan available to your spouse 7. A change in employment status for you or your spouse that affects your eligibility for benefits Physician Physician means a licensed doctor practicing within the scope of his or her license and rendering care and treatment to an Insured that is appropriate for the condition and locality. The term does not include you, your spouse, your immediate family (including parents, children, siblings, or spouses of any of the foregoing, whether the relationship derives from blood or marriage), or a person living in your household. Prior Plan The Prior Plan refers to the plan of insurance providing similar benefits to you, sponsored by the Employer and in effect directly prior to the Policy Effective Date. A Prior Plan will include the plan of a company in effect on the day prior to that company's addition to this Policy after the Policy Effective Date. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 22 of 75 17 Regular Occupation The occupation you routinely perform at the time the Disability begins. In evaluating the Disability, we will consider the duties of the occupation as it is normally performed in the general labor market in the national economy. It is not work tasks that are performed for a specific employer or at a specific location. Rehabilitation Plan A written plan designed to enable you to return to work. The Rehabilitation Plan will consist of one or more of the following phases: 1. rehabilitation, under which we may provide, arrange or authorize education, vocational or physical rehabilitation or other appropriate services; 2 work, which may include modified work and work on a part-time basis. Sickness The term Sickness means a physical or mental illness. Temporary Layoff Temporary Layoff means a temporary suspension of Active Service for a period of time determined in advance by the Employer, other than a Furlough as defined. Temporary Layoff does not include the permanent termination of Active Service (including but not limited to a job elimination), which shall be treated as termination of employment. TL-007500.19 as modified by TL-009980 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 23 of 75 18 SUPPLEMENTAL INFORMATION for Crosby Tugs, LLC required by the Employee Retirement Income Security Act of 1974 As a Plan participant in Crosby Tugs, LLC's Insurance Plan, you are entitled to certain rights and protection under the Employee Retirement Income Security Act of 1974 (ERISA). You should refer to the attached Certificate for a description of when you will become eligible under the Plan, the amount and types of benefits available to you, and the circumstances under which benefits are not available to you or may end. The Certificate, along with the following Supplemental Information, makes up the Summary Plan Description as required by ERISA. IMPORTANT INFORMATION ABOUT THE PLAN • The Plan is established and maintained by Crosby Tugs, LLC, the Plan Sponsor. • The Employer Identification Number (EIN) is 72-0914194. • The Plan Number is 501. • The Insurance Plan is administered directly by the Plan Administrator with benefits provided, in accordance with the provisions of the group insurance contract, VDT-961002, issued by LIFE INSURANCE COMPANY OF NORTH AMERICA. • The Plan Administrator is: Crosby Tugs, LLC PO address below Golden Meadow, LA 70357 504-289-0599 The Plan Administrator has authority to control and manage the operation and administration of the Plan. • The Plan Sponsor may terminate, suspend, withdraw or amend the Plan, in whole or in part, at any time, subject to the applicable provisions of the Policy. (Your rights upon termination or amendment of the Plan are set forth in your Certificate.) • The agent for service of legal process is the Plan Administrator. • The Plan of benefits is financed by the Employees. • The date of the end of the Plan Year is February 28. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 24 of 75 19 WHAT YOU SHOULD DO AND EXPECT IF YOU HAVE A CLAIM When you are eligible to receive benefits under the Plan, you must request a claim form or obtain instructions for submitting your claim telephonically or electronically, from the Plan Administrator. All claims you submit must be on the claim form or in the electronic or telephonic format provided by the Insurance Company. You must complete your claim according to directions provided by the Insurance Company. If these forms or instructions are not available, you must provide a written statement of proof of loss. After you have completed the claim form or written statement, you must submit it to the Plan Administrator. The Plan Administrator has appointed the Insurance Company as the named fiduciary for adjudicating claims for benefits under the Plan, and for deciding any appeals of denied claims. The Insurance Company shall have the authority, in its discretion, to interpret the terms of the Plan, to decide questions of eligibility for coverage or benefits under the Plan, and to make any related findings of fact. All decisions made by the Insurance Company shall be final and binding on Participants and Beneficiaries to the full extent permitted by law. The Insurance Company has 45 days from the date it receives your claim for disability benefits, or 90 days from the date it receives a claim for any other benefit, to determine whether or not benefits are payable to you in accordance with the terms and provisions of the Policy. The Insurance Company may require more time to review your claim if necessary due to circumstances beyond its control. If this should happen, the Insurance Company must notify you in writing that its review period has been extended for up to two additional periods of 30 days ( in the case of a claim for disability benefits), or one additional period of 90 days (in the case of any other benefit). If this extension is made because you must furnish additional information, these extension periods will begin when the additional information is received. You have up to 45 days to furnish the requested information. During the review period, the Insurance Company may require a medical examination of the Insured, at its own expense; or additional information regarding the claim. If a medical examination is required, the Insurance Company will notify you of the date and time of the examination and the physician’s name and location. It is important that you keep any appointments made since rescheduling examinations will delay the claim process. If additional information is required, the Insurance Company must notify you, in writing, stating the information needed and explaining why it is needed. If your claim is approved, you will receive the appropriate benefit from the Insurance Company. If your claim is denied, in whole or in part, you must receive a written notice from the Insurance Company within the review period. The Insurance Company’s written notice must include the following information: 1. The specific reason(s) the claim was denied. 2. Specific reference to the Policy provision(s) on which the denial was based. 3. Any additional information required for your claim to be reconsidered, and the reason this information is necessary. 4. In the case of any claim for a disability benefit, identification of any internal rule, guideline or protocol relied on in making the claim decision, and an explanation of any medically-related exclusion or limitation involved in the decision. 5. A statement informing you of your right to appeal the decision, and an explanation of the appeal procedure, including a statement of your right to bring a civil action under Section 502(a) of ERISA if your appeal is denied. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 25 of 75 20 Appeal Procedure for Denied Claims Whenever a claim is denied, you have the right to appeal the decision. You (or your duly authorized representative) must make a written request for appeal to the Insurance Company within 60 days (180 days in the case of any claim for disability benefits) from the date you receive the denial. If you do not make this request within that time, you will have waived your right to appeal. Once your request has been received by the Insurance Company, a prompt and complete review of your claim must take place. This review will give no deference to the original claim decision, and will not be made by the person who made the initial claim decision. During the review, you (or your duly authorized representative) have the right to review any documents that have a bearing on the claim, including the documents which establish and control the Plan. Any medical or vocational experts consulted by the Insurance Company will be identified. You may also submit issues and comments that you feel might affect the outcome of the review. The Insurance Company has 60 days from the date it receives your request to review your claim and notify you of its decision (45 days, in the case of any claim for disability benefits). Under special circumstances, the Insurance Company may require more time to review your claim. If this should happen, the Insurance Company must notify you, in writing, that its review period has been extended for an additional 60 days (45 days in the case of any claim for disability benefits). Once its review is complete, the Insurance Company must notify you, in writing, of the results of the review and indicate the Plan provisions upon which it based its decision. YOUR RIGHTS AS SET FORTH BY ERISA As a participant in Crosby Tugs, LLC's Insurance Plan you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all plan participants shall be entitled to: Receive Information About Your Plan and Benefits Examine, without charge, at the plan administrator's office and at other specified locations, such as worksites and union halls, all documents governing the plan, including insurance contracts and collective bargaining agreements, and a copy of the latest annual report (Form 5500 Series) filed by the plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefit Security Administration. Obtain, upon written request to the plan administrator, copies of documents governing the operation of the plan, including insurance contracts and collective bargaining agreements, and copies of the latest annual report (Form 5500 Series) and updated summary plan description. The administrator may make a reasonable charge for the copies. Receive a summary of the plan's annual financial report. The plan administrator is required by law to furnish each participant with a copy of this summary annual report. Prudent Actions by Plan Fiduciaries In addition to creating rights for plan participants ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate your plan, called "fiduciaries'' of the plan, have a duty to do so prudently and in the interest of you and other plan participants and beneficiaries. No one, including your employer, your union, or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a welfare benefit or exercising your rights under ERISA. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 26 of 75 21 Enforce Your Rights If your claim for a welfare benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of plan documents or the latest annual report from the plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the plan administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court. If it should happen that plan fiduciaries misuse the plan's money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. Assistance with Your Questions If you have any questions about your plan, you should contact the plan administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the plan administrator, you should contact the nearest office of the Employee Benefit Security Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefit Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefit Security Administration. LM-5B35a ER-03-1 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 27 of 75 22 IMPORTANT CHANGES FOR STATE REQUIREMENTS If you reside in one of the following states, please read the important changes below. The provisions of your certificate are modified for residents of the following states. The modifications listed apply only to residents of that state, and only when the underlying provision is included in the certificate. Minnesota residents: The Pre-existing Condition Limitation, if any, may not be longer than 24 months from the insured’s most recent effective date of insurance. Texas residents: Any provision offsetting or otherwise reducing any benefit by an amount payable under an individual or franchise policy will not apply. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 28 of 75 UNDERWRITTEN BY: LIFE INSURANCE COMPANY OF NORTH AMERICA a CIGNA company Class 1 11/2012 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 29 of 75 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 30 of 75 EXHIBIT B Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 31 of 75 IMPORTANT NOTICE To obtain information or make a complaint: You may call the toll-free telephone number for information or to make a complaint at: 1-800-547-5515 You may contact the Texas Department of Insurance to obtain information on companies, coverages, rights or complaints at: 1-800-252-3439 You may write the Texas Department of Insurance P.O. Box 149091 Austin, TX 78714-9104 FAX # (512) 475-1771 PREMIUM OR CLAIM DISPUTES: Should you have a dispute concerning your premium or about a claim you should contact the agent or company first. If the dispute is not resolved, you may contact the Texas Department of Insurance. ATTACH THIS NOTICE TO YOUR POLICY: This notice is for information only and does not become a part or condition of the attached document. TL-004426 AVISO IMPORTANTE Para solicitar información o presentar una queja: Usted puede llamar al numero de telefono gratis para información o pare someter una queja al: 1-800-547-5515 Puede comunicarse con el Departamento de Seguros de Texas para obtener información sobre compañías, coberturas, derechos o quejas llamando al: 1-800-252-3439 También puede escribir al Texas Department of Insurance (Departamento de Seguros de Texas) P.O. Box 149091 Austin, TX 78714-9104 FAX # (512) 475-1771 CONFLICTOS POR PRIMAS O RECLAMACIONES: En caso de tener un conflicto relacionado con su prima o una reclamación, debe comunicarse primero con el agente o la compañía. Si el conflicto no se resuelve, usted puede comunicarse con el Departamento de Seguros de Texas. UNA ESTE AVISO A SU POLIZA: Este aviso es solo para proposito de informacion y no se convierte en parte o condicion del documento adjunto. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 32 of 75 IMPORTANT INFORMATION ABOUT COVERAGE UNDER THE TEXAS LIFE, ACCIDENT, HEALTH AND HOSPITAL SERVICE INSURANCE GUARANTY ASSOCIATION (For insurers declared insolvent or impaired on or after September 1, 2005) Texas law establishes a system, administered by the Texas Life, Accident, Health and Hospital Service Insurance Guaranty Association (the "Association"), to protect Texas policyholders if their life or health insurance company fails. Only the policyholders of insurance companies which are members of the Association are eligible for this protection which is subject to the terms, limitations, and conditions of the Association law. (The law is found in the Texas Insurance Code, Chapter 463.) It is possible that the Association may not cover your policy in full or in part due to statutory limitations. ELIGIBILITY FOR PROTECTION BY THE ASSOCIATION When a member insurance company is found to be insolvent and placed under an order of liquidation by a court or designated as impaired by the Texas Commissioner of Insurance, the Association provides coverage to policyholders who are: • Residents of Texas at that time (irrespective of the policyholder's residency at policy issue) • Residents of other states, ONLY if the following conditions are met: 1) The policyholder has a policy with a company domiciled in Texas; 2) The policyholder's state of residence has a similar guaranty association; and 3) The policyholder is not eligible for coverage by the guaranty association of the policyholder's state of residence. LIMITS OF PROTECTION BY THE ASSOCIATION Accident, Accident and Health, or Health Insurance: • For each individual covered under one or more policies: up to a total of $500,000 for basic hospital, medical-surgical, and major medical insurance, $300,000 for disability or long term care insurance, and $200,000 for other types of health insurance. Life Insurance: • Net cash surrender value or net cash withdrawal value up to a total of $100,000 under one or more policies on any one life; or • Death benefits up to a total of $300,000 under one or more policies on any one life; or • Total benefits up to a total of $5,000,000 to any owner of multiple non-group life policies. Individual Annuities: • Present value of benefits up to a total of $100,000 under one or more contracts on any one life. Group Annuities: • Present value of allocated benefits up to a total of $100,000 on any one life; or • Present value of unallocated benefits up to a total of $5,000,000 for one contractholder regardless of the number of contracts. Aggregate Limit: • $300,000 on any one life with the exception of the $500,000 health insurance limit, the $5,000,000 multiple owner life insurance limit, and the $5,000,000 unallocated group annuity limit. Insurance companies and agents are prohibited by law from using the existence of the Association for the purpose of sales, solicitation, or inducement to purchase any form of insurance. When you are selecting an insurance company, you should not rely on Association coverage. Texas Life, Accident, Health and Hospital Texas Department of Insurance Service Insurance Guaranty Association P.O. Box 149104 6504 Bridge Point Parkway, Suite 450 Austin, Texas 78714-9104 Austin, Texas 78730 800-252-3439 or www.tdi.state.tx.us 800-982-6362 or www.txlifega.org Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 33 of 75 LIFE INSURANCE COMPANY OF NORTH AMERICA 1601 CHESTNUT STREET GROUP POLICY PHILADELPHIA, PA 19192-2235 (800) 732-1603 TDD (800) 552-5744 A STOCK INSURANCE COMPANY POLICYHOLDER: Martin Resource Management Corporation POLICY NUMBER: VDT-960981 POLICY EFFECTIVE DATE: January 1, 2012 POLICY ANNIVERSARY DATE: January 1 This Policy describes the terms and conditions of coverage. It is issued in Texas and shall be governed by its laws. The Policy goes into effect on the Policy Effective Date, 12:01 a.m. at the Policyholder's address. In return for the required premium, the Insurance Company and the Policyholder have agreed to all the terms of this Policy. Scott Kern, Corporate Secretary Matthew G. Manders, President TL-004700 O/O v-2 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 34 of 75 TABLE OF CONTENTS SCHEDULE OF BENEFITS........................................................................................................................ 1 SCHEDULE OF BENEFITS FOR CLASS 1............................................................................................... 2 SCHEDULE OF BENEFITS FOR CLASS 2............................................................................................... 5 SCHEDULE OF BENEFITS FOR CLASS 3............................................................................................... 8 ELIGIBILITY FOR INSURANCE ............................................................................................................ 11 EFFECTIVE DATE OF INSURANCE...................................................................................................... 11 TERMINATION OF INSURANCE........................................................................................................... 11 CONTINUATION OF INSURANCE ........................................................................................................ 12 DESCRIPTION OF BENEFITS................................................................................................................. 14 EXCLUSIONS............................................................................................................................................ 21 CLAIM PROVISIONS ............................................................................................................................... 21 ADMINISTRATIVE PROVISIONS.......................................................................................................... 23 GENERAL PROVISIONS ......................................................................................................................... 24 DEFINITIONS............................................................................................................................................ 25 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 35 of 75 1 SCHEDULE OF BENEFITS Premium Due Date: The last day of each month Classes of Eligible Employees On the pages following the definition of eligible employees there is a Schedule of Benefits for each Class of Eligible Employees listed below. For an explanation of these benefits, please see the Description of Benefits provision. If an Employee is eligible under one Class of Eligible Employees and later becomes eligible under a different Class of Eligible Employees, changes in his or her insurance due to the class change will be effective on the first date you are in Active Service on or after the date of the change in class. Class 1 All active, Full-time Employees of the Employer classified as Executives regularly working a minimum of 30 hours per week. Class 2 All active, Full-time Employees of the Employer classified as Drivers regularly working a minimum of 30 hours per week. Class 3 All active, Full-time Employees of the Employer regularly working a minimum of 30 hours per week, excluding Employees classified as Executives and Drivers. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 36 of 75 2 SCHEDULE OF BENEFITS FOR CLASS 1 Eligibility Waiting Period For Employees hired on or before the Policy Effective Date: The first of the month following the date of hire For Employees hired after the Policy Effective Date: The first of the month following the date of hire Definition of Disability/Disabled The Employee is considered Disabled if, solely because of Injury or Sickness, he or she is: 1. unable to perform the material duties of his or her Regular Occupation; and 2. unable to earn 80% or more of his or her Indexed Earnings from working in his or her Regular Occupation. The Insurance Company will require proof of earnings and continued Disability. Definition of Covered Earnings Covered Earnings means an Employee's earnings as figured from the W-2 form (from the box that reflects wages, tips and other compensation for federal income tax purposes) received from the Employer for the calendar year just prior to the date Disability begins. If the Employee was not employed by the Employer for the full year or no W-2 was received, it means an Employee's average monthly earnings from the Employer for the months employed. Any increase in an Employee's Covered Earnings will not be effective during a period of continuous Disability. Elimination Period The later of 180 days or the date short term disability payments under Policy VDT 960980, underwritten by Life Insurance Company of North America, ends. Gross Disability Benefit The lesser of 60% of an Employee's monthly Covered Earnings rounded to the nearest dollar or the Maximum Disability Benefit. Maximum Disability Benefit $15,000 per month Minimum Disability Benefit $100 per month Disability Benefit Calculation The Disability Benefit payable to the Employee is figured using the Gross Disability Benefit, Other Income Benefits and the Return to Work Incentive. Monthly Benefits are based on a 30-day month. The Disability Benefit will be prorated if payable for any period less than a month. During any month the Employee has no Disability Earnings, the monthly benefit payable is the Gross Disability Benefit less Other Income Benefits. During any month the Employee has Disability Earnings, benefits are determined under the Return to Work Incentive. Benefits will not be less than the minimum benefit shown in the Schedule of Benefits except as provided under the section Minimum Benefit. "Other Income Benefits" means any benefits listed in the Other Income Benefits provision that an Employee receives on his or her own behalf or for dependents, or which the Employee's dependents receive because of the Employee's entitlement to Other Income Benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 37 of 75 3 Return to Work Incentive During any month the Employee has Disability Earnings, his or her benefits will be calculated as follows. The Employee's monthly benefit payable will be calculated as follows during the first 24 months disability benefits are payable and the Employee has Disability Earnings: 1. Add the Employee's Gross Disability Benefit and Disability Earnings. 2. Compare the sum from 1. to the Employee's Indexed Earnings. 3. If the sum from 1. exceeds 100% of the Employee's Indexed Earnings, then subtract the Indexed Earnings from the sum in 1. 4. The Employee's Gross Disability Benefit will be reduced by the difference from 3., as well as by Other Income Benefits. 5. If the sum from 1. does not exceed 100% of the Employee's Indexed Earnings, the Employee's Gross Disability Benefit will be reduced by Other Income Benefits. After disability benefits are payable for 24 months, the monthly benefit payable is the Gross Disability Benefit reduced by Other Income Benefits and 50% of Disability Earnings. No Disability Benefits will be paid, and insurance will end if the Insurance Company determines the Employee is able to work under a modified work arrangement and he or she refuses to do so without Good Cause. Additional Benefits Catastrophic Disability Benefit Amount of Benefit: 25% of an Employee's monthly Covered Earnings to a maximum monthly benefit of $5,000. Cost Of Living Adjustment (COLA) Benefit Waiting Period: After 12 Monthly Benefits are payable Maximum COLA Increase: 3% COLA Increase Date: January 1 Maximum Benefit Period: 10 years Survivor Benefit Benefit Waiting Period: After 6 Monthly Benefits are payable. Amount of Benefit: 100% of the sum of the last full Disability Benefit plus the amount of any Disability Earnings by which the benefit had been reduced for that month. Maximum Benefit Period A single lump sum payment equal to 3 monthly Survivor Benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 38 of 75 4 Maximum Benefit Period The later of the Employee’s SSNRA* or the Maximum Benefit Period listed below. Age When Disability Begins Maximum Benefit Period Age 62 or under The Employee's 65th birthday or the date the 42nd Monthly Benefit is payable, if later. Age 63 The date the 36th Monthly Benefit is payable. Age 64 The date the 30th Monthly Benefit is payable. Age 65 The date the 24th Monthly Benefit is payable. Age 66 The date the 21st Monthly Benefit is payable. Age 67 The date the 18th Monthly Benefit is payable. Age 68 The date the 15th Monthly Benefit is payable. Age 69 or older The date the 12th Monthly Benefit is payable. *SSNRA means the Social Security Normal Retirement Age in effect under the Social Security Act on the Policy Effective Date. Initial Premium Rates $.55 per $100 of Covered Payroll Covered Payroll for an Employee will mean his or her Covered Earnings for the insurance month prior to the date the determination is made. However, an Employee's Covered Payroll will not include any part of his or her monthly Covered Earnings which exceed $25,000. TL-004774 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 39 of 75 5 SCHEDULE OF BENEFITS FOR CLASS 2 Eligibility Waiting Period For Employees hired on or before the Policy Effective Date: The first of the month following the date of hire For Employees hired after the Policy Effective Date: The first of the month following the date of hire Definition of Disability/Disabled The Employee is considered Disabled if solely due to Injury or Sickness, he or she is: 1. unable to perform the material duties of his or her Regular Occupation. For Drivers only, this includes being unable to meet the driving requirements as outlined under the Department of Transportation regulations; and 2. unable to earn 80% or more of his or her Indexed Earnings from working in his or her Regular Occupation. After Disability Benefits have been payable for 24 months, the Employee is considered Disabled if, solely due to Injury or Sickness, he or she is: 1. unable to perform the material duties of any occupation for which he or she is, or may reasonably become, qualified based on education, training or experience; and 2. unable to earn 60% or more of his or her Indexed Earnings. The Insurance Company will require proof of earnings and continued Disability. Definition of Covered Earnings Covered Earnings means an Employee's wage or salary as reported by the Employer for work performed for the Employer as in effect just prior to the date Disability begins. It includes earnings received from commissions but not bonuses, overtime pay or other extra compensation. Covered Earnings are determined initially on the date an Employee applies for coverage. A change in the amount of Covered Earnings is effective on the date of the change, if the Employer gives us written notice of the change and the required premium is paid. Commissions will be averaged for the 12 months just prior to the date Disability begins, or the months employed, if less than 12 months. Any increase in an Employee's Covered Earnings will not be effective during a period of continuous Disability. Elimination Period The later of 180 days or the date short term disability payments under Policy VDT 960980, underwritten by Life Insurance Company of North America, ends. Gross Disability Benefit The lesser of 60% of an Employee's monthly Covered Earnings rounded to the nearest dollar or the Maximum Disability Benefit. Maximum Disability Benefit $10,000 per month Minimum Disability Benefit $100 per month Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 40 of 75 6 Disability Benefit Calculation The Disability Benefit payable to the Employee is figured using the Gross Disability Benefit, Other Income Benefits and the Return to Work Incentive. Monthly Benefits are based on a 30-day month. The Disability Benefit will be prorated if payable for any period less than a month. During any month the Employee has no Disability Earnings, the monthly benefit payable is the Gross Disability Benefit less Other Income Benefits. During any month the Employee has Disability Earnings, benefits are determined under the Return to Work Incentive. Benefits will not be less than the minimum benefit shown in the Schedule of Benefits except as provided under the section Minimum Benefit. "Other Income Benefits" means any benefits listed in the Other Income Benefits provision that an Employee receives on his or her own behalf or for dependents, or which the Employee's dependents receive because of the Employee's entitlement to Other Income Benefits. Return to Work Incentive During any month the Employee has Disability Earnings, his or her benefits will be calculated as follows. The Employee's monthly benefit payable will be calculated as follows during the first 24 months disability benefits are payable and the Employee has Disability Earnings: 1. Add the Employee's Gross Disability Benefit and Disability Earnings. 2. Compare the sum from 1. to the Employee's Indexed Earnings. 3. If the sum from 1. exceeds 100% of the Employee's Indexed Earnings, then subtract the Indexed Earnings from the sum in 1. 4. The Employee's Gross Disability Benefit will be reduced by the difference from 3., as well as by Other Income Benefits. 5. If the sum from 1. does not exceed 100% of the Employee's Indexed Earnings, the Employee's Gross Disability Benefit will be reduced by Other Income Benefits. After disability benefits are payable for 24 months, the monthly benefit payable is the Gross Disability Benefit reduced by Other Income Benefits and 50% of Disability Earnings. No Disability Benefits will be paid, and insurance will end if the Insurance Company determines the Employee is able to work under a modified work arrangement and he or she refuses to do so without Good Cause. Additional Benefits Cost Of Living Adjustment (COLA) Benefit This Benefit does not apply to this class of Employee. Survivor Benefit Benefit Waiting Period: After 6 Monthly Benefits are payable. Amount of Benefit: 100% of the sum of the last full Disability Benefit plus the amount of any Disability Earnings by which the benefit had been reduced for that month. Maximum Benefit Period A single lump sum payment equal to 3 monthly Survivor Benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 41 of 75 7 Maximum Benefit Period The later of the Employee’s SSNRA* or the Maximum Benefit Period listed below. Age When Disability Begins Maximum Benefit Period Age 62 or under The Employee's 65th birthday or the date the 42nd Monthly Benefit is payable, if later. Age 63 The date the 36th Monthly Benefit is payable. Age 64 The date the 30th Monthly Benefit is payable. Age 65 The date the 24th Monthly Benefit is payable. Age 66 The date the 21st Monthly Benefit is payable. Age 67 The date the 18th Monthly Benefit is payable. Age 68 The date the 15th Monthly Benefit is payable. Age 69 or older The date the 12th Monthly Benefit is payable. *SSNRA means the Social Security Normal Retirement Age in effect under the Social Security Act on the Policy Effective Date. Initial Premium Rates $.87 per $100 of Covered Payroll Covered Payroll for an Employee will mean his or her Covered Earnings for the insurance month prior to the date the determination is made. However, an Employee's Covered Payroll will not include any part of his or her monthly Covered Earnings which exceed $16,667. TL-004774 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 42 of 75 8 SCHEDULE OF BENEFITS FOR CLASS 3 Eligibility Waiting Period For Employees hired on or before the Policy Effective Date: The first of the month following the date of hire For Employees hired after the Policy Effective Date: The first of the month following the date of hire Definition of Disability/Disabled The Employee is considered Disabled if, solely because of Injury or Sickness, he or she is: 1. unable to perform the material duties of his or her Regular Occupation; and 2. unable to earn 80% or more of his or her Indexed Earnings from working in his or her Regular Occupation. After Disability Benefits have been payable for 24 months, the Employee is considered Disabled if, solely due to Injury or Sickness, he or she is: 1. unable to perform the material duties of any occupation for which he or she is, or may reasonably become, qualified based on education, training or experience; and 2. unable to earn 60% or more of his or her Indexed Earnings. The Insurance Company will require proof of earnings and continued Disability. Definition of Covered Earnings Covered Earnings means an Employee's wage or salary as reported by the Employer for work performed for the Employer as in effect just prior to the date Disability begins. Covered Earnings are determined initially on the date an Employee applies for coverage. A change in the amount of Covered Earnings is effective on the date of the change, if the Employer gives us written notice of the change and the required premium is paid. It does not include amounts received as bonus, commissions, overtime pay or other extra compensation. Any increase in an Employee's Covered Earnings will not be effective during a period of continuous Disability. Elimination Period The later of 180 days or the date short term disability payments under Policy VDT 960980, underwritten by Life Insurance Company of North America, ends. Gross Disability Benefit The lesser of 60% of an Employee's monthly Covered Earnings rounded to the nearest dollar or the Maximum Disability Benefit. Maximum Disability Benefit $10,000 per month Minimum Disability Benefit $100 per month Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 43 of 75 9 Disability Benefit Calculation The Disability Benefit payable to the Employee is figured using the Gross Disability Benefit, Other Income Benefits and the Return to Work Incentive. Monthly Benefits are based on a 30-day month. The Disability Benefit will be prorated if payable for any period less than a month. During any month the Employee has no Disability Earnings, the monthly benefit payable is the Gross Disability Benefit less Other Income Benefits. During any month the Employee has Disability Earnings, benefits are determined under the Return to Work Incentive. Benefits will not be less than the minimum benefit shown in the Schedule of Benefits except as provided under the section Minimum Benefit. "Other Income Benefits" means any benefits listed in the Other Income Benefits provision that an Employee receives on his or her own behalf or for dependents, or which the Employee's dependents receive because of the Employee's entitlement to Other Income Benefits. Return to Work Incentive During any month the Employee has Disability Earnings, his or her benefits will be calculated as follows. The Employee's monthly benefit payable will be calculated as follows during the first 24 months disability benefits are payable and the Employee has Disability Earnings: 1. Add the Employee's Gross Disability Benefit and Disability Earnings. 2. Compare the sum from 1. to the Employee's Indexed Earnings. 3. If the sum from 1. exceeds 100% of the Employee's Indexed Earnings, then subtract the Indexed Earnings from the sum in 1. 4. The Employee's Gross Disability Benefit will be reduced by the difference from 3., as well as by Other Income Benefits. 5. If the sum from 1. does not exceed 100% of the Employee's Indexed Earnings, the Employee's Gross Disability Benefit will be reduced by Other Income Benefits. After disability benefits are payable for 24 months, the monthly benefit payable is the Gross Disability Benefit reduced by Other Income Benefits and 50% of Disability Earnings. No Disability Benefits will be paid, and insurance will end if the Insurance Company determines the Employee is able to work under a modified work arrangement and he or she refuses to do so without Good Cause. Additional Benefits Cost Of Living Adjustment (COLA) Benefit This Benefit does not apply to this class of Employee. Survivor Benefit Benefit Waiting Period: After 6 Monthly Benefits are payable. Amount of Benefit: 100% of the sum of the last full Disability Benefit plus the amount of any Disability Earnings by which the benefit had been reduced for that month. Maximum Benefit Period A single lump sum payment equal to 3 monthly Survivor Benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 44 of 75 10 Maximum Benefit Period The later of the Employee’s SSNRA* or the Maximum Benefit Period listed below. Age When Disability Begins Maximum Benefit Period Age 62 or under The Employee's 65th birthday or the date the 42nd Monthly Benefit is payable, if later. Age 63 The date the 36th Monthly Benefit is payable. Age 64 The date the 30th Monthly Benefit is payable. Age 65 The date the 24th Monthly Benefit is payable. Age 66 The date the 21st Monthly Benefit is payable. Age 67 The date the 18th Monthly Benefit is payable. Age 68 The date the 15th Monthly Benefit is payable. Age 69 or older The date the 12th Monthly Benefit is payable. *SSNRA means the Social Security Normal Retirement Age in effect under the Social Security Act on the Policy Effective Date. Initial Premium Rates $.87 per $100 of Covered Payroll Covered Payroll for an Employee will mean his or her Covered Earnings for the insurance month prior to the date the determination is made. However, an Employee's Covered Payroll will not include any part of his or her monthly Covered Earnings which exceed $16,667. TL-004774 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 45 of 75 11 ELIGIBILITY FOR INSURANCE An Employee in one of the Classes of Eligible Employees shown in the Schedule of Benefits is eligible to be insured on the Policy Effective Date, or the day after he or she completes the Eligibility Waiting Period, if later. The Eligibility Waiting Period is the period of time the Employee must be in Active Service to be eligible for coverage. It will be extended by the number of days the Employee is not in Active Service. Except as noted in the Reinstatement Provision, if an Employee terminates coverage and later wishes to reapply, or if a former Employee is rehired, a new Eligibility Waiting Period must be satisfied. An Employee is not required to satisfy a new Eligibility Waiting Period if insurance ends because he or she is no longer in a Class of Eligible Employees, but continues to be employed and within one year becomes a member of an eligible class. TL-004710 EFFECTIVE DATE OF INSURANCE An Employee who is required to contribute to the cost of this insurance may elect to be insured only by authorizing payroll deduction in a form approved by the Employer and the Insurance Company. The effective date of this insurance depends on the date coverage is elected. Insurance for an Employee who applies for coverage within 31 days after he or she becomes eligible or during an Annual Enrollment Period is effective on the latest of the following dates. 1. The Policy Effective Date. 2. The date payroll deduction is authorized. 3. The date the Employer or Insurance Company receives the completed enrollment form. If an Employee's enrollment form is received more than 31 days after he or she is eligible for this insurance, the Insurability Requirement must be satisfied before this insurance is effective. If approved, this insurance is effective on the date the Insurance Company agrees in writing to insure the Employee. If an Employee is not in Active Service on the date insurance would otherwise be effective, it will be effective on the date he or she returns to any occupation for the Employer on a Full-time basis. TL-004712 TERMINATION OF INSURANCE An Employee's coverage will end on the earliest of the following dates: 1. the date the Employee is eligible for coverage under a plan intended to replace this coverage; 2. the date the Policy is terminated; 3. the date the Employee is no longer in an eligible class; 4. the day after the end of the period for which premiums are paid; 5. the date the Employee is no longer in Active Service; 6. the date benefits end for failure to comply with the terms and conditions of the Policy. Disability Benefits will be payable to an Employee who is entitled to receive Disability Benefits when the Policy terminates, if he or she remains disabled and meets the requirements of the Policy. Any period of Disability, regardless of cause, that begins when the Employee is eligible under another group disability coverage provided by any employer, will not be covered. TL-007505.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 46 of 75 12 CONTINUATION OF INSURANCE This Continuation of Insurance provision modifies the Termination of Insurance provision to allow insurance to continue under certain circumstances if the Insured Employee is no longer in Active Service. Insurance that is continued under this provision is subject to all other terms of the Termination of Insurance provisions. Disability Insurance continues if an Employee's Active Service ends due to a Disability for which benefits under the Policy are or may become payable. Premiums for the Employee will be waived while Disability Benefits are payable. If the Employee does not return to Active Service, this insurance ends when the Disability ends or when benefits are no longer payable, whichever occurs first. If an Employee’s Active Service ends due to an approved leave pursuant to the Family and Medical Leave Act (FMLA), insurance will continue up to the later of the period of his or her approved FMLA leave or the leave period required by law in the state in which he or she is employed. Premiums are required for this coverage. If an Employee’s Active Service ends due to any other leave of absence approved in writing by the Employer prior to the date the Employee ceases work, insurance will continue for an Employee for up to 12 months. Premiums are required for this coverage. An approved leave of absence does not include Furlough, Temporary Layoff or termination of employment. If an Employee’s Active Service ends due to any other excused short term absence from work that is reported to the Employer timely in accordance with the Employer’s reporting requirements for such short term absence, insurance for an Employee will continue until the earlier of: a. the date the Employee’s employment relationship with the Employer terminates; b. the date premiums are not paid when due; c. the end of the 30 day period that begins with the first day of such excused absence; d. the end of the period for which such short term absence is excused by the Employer. Notwithstanding any other provision of this policy, if an Employee’s Active Service ends due to layoff, termination of employment or any other termination of the employment relationship, insurance will terminate and Continuation of Insurance under this provision will not apply. If an Employee’s insurance is continued pursuant to this Continuation of Insurance provision, and he or she becomes Disabled during such period of continuation, Disability Benefits will not begin until the later of the date the Elimination Period is satisfied or the date he or she is scheduled to return to Active Service. TL-009970.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 47 of 75 13 TAKEOVER PROVISION This provision applies only to Employees eligible under this Policy who were covered for long term disability coverage on the day prior to the effective date of this Policy under the Prior Plan provided by the Policyholder or by an entity that has been acquired by the Policyholder. A. This section A applies to Employees who are not in Active Service on the day prior to the effective date of this Policy due to a reason for which the Prior Plan and this Policy both provide for continuation of insurance. If required premium is paid when due, the Insurance Company will insure an Employee to which this section applies against a disability that occurs after the effective date of this Policy for the affected employee group. This coverage will be provided until the earlier of the date: (a) the employee returns to Active Service, (b) continuation of insurance under the Prior Plan would end but for termination of that plan; or (c) the date continuation of insurance under this Policy would end if computed from the first day the employee was not in Active Service. The Policy will provide this coverage as follows: 1. If benefits for a disability are covered under the Prior Plan, no benefits are payable under this Plan. 2. If the disability is not a covered disability under the Prior Plan solely because the plan terminated, benefits payable under this Policy for that disability will be the lesser of: (a) the disability benefits that would have been payable under the Prior Plan; and (b) those provided by this Policy. Credit will be given for partial completion under the Prior Plan of Elimination Periods and partial satisfaction of pre-existing condition limitations. B. The Elimination Period under this Policy will be waived for a Disability which begins while the Employee is insured under this Policy if all of the following conditions are met: 1. The Disability results from the same or related causes as a Disability for which monthly benefits were payable under the Prior Plan; 2. Benefits are not payable for the Disability under the Prior Plan solely because it is not in effect; 3. An Elimination Period would not apply to the Disability if the Prior Plan had not ended; 4. The Disability begins within 6 months of the Employee’s return to Active Service and the Employee’s insurance under this Policy is continuous from this Policy’s Effective Date. C. Except for any amount of benefit in excess of a Prior Plan's benefits, the Pre-existing Condition Limitation will not apply to an Employee covered under a Prior Plan who satisfied the pre-existing condition limitation, if any, under that plan. If an Employee, covered under a Prior Plan, did not fully satisfy the pre-existing condition limitation of that plan, credit will be given for any time that was satisfied under the Prior Plan's pre-existing condition limitation. Benefits will be determined based on the lesser of: (1) the amount of the gross disability benefit under the Prior Plan and any applicable maximums; and (2) those provided by this Policy. If benefits are payable under the Prior Plan for the Disability, no benefits are payable under this Policy. TL-005108 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 48 of 75 14 DESCRIPTION OF BENEFITS The following provisions explain the benefits available under the Policy. Please see the Schedule of Benefits for the applicability of these benefits to each class of Insureds. Disability Benefits The Insurance Company will pay Disability Benefits if an Employee becomes Disabled while covered under this Policy. The Employee must satisfy the Elimination Period, be under the Appropriate Care of a Physician, and meet all the other terms and conditions of the Policy. He or she must provide the Insurance Company, at his or her own expense, satisfactory proof of Disability before benefits will be paid. The Disability Benefit is shown in the Schedule of Benefits. The Insurance Company will require continued proof of the Employee’s Disability for benefits to continue. Elimination Period The Elimination Period is the period of time an Employee must be continuously Disabled before Disability Benefits are payable. The Elimination Period is shown in the Schedule of Benefits. A period of Disability is not continuous if separate periods of Disability result from unrelated causes. Disability Benefit Calculation The Disability Benefit Calculation is shown in the Schedule of Benefits. Monthly Disability Benefits are based on a 30 day period. They will be prorated if payable for any period less than a month. If an Employee is working while Disabled, the Disability Benefit Calculation will be the Return to Work Incentive. Return to Work Incentive The Return to Work Incentive is shown in the Schedule of Benefits. An Employee may work for wage or profit while Disabled. In any month in which the Employee works and a Disability Benefit is payable, the Return to Work Incentive applies. The Insurance Company will, from time to time, review the Employee's status and will require satisfactory proof of earnings and continued Disability. Minimum Benefit The Insurance Company will pay the Minimum Benefit shown in the Schedule of Benefits despite any reductions made for Other Income Benefits. The Minimum Benefit will not apply if benefits are being withheld to recover an overpayment of benefits. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 49 of 75 15 Other Income Benefits An Employee for whom Disability Benefits are payable under this Policy may be eligible for benefits from Other Income Benefits. If so, the Insurance Company may reduce the Disability Benefits by the amount of such Other Income Benefits. Other Income Benefits include: 1.1. any amounts received (or assumed to be received*) by the Employee or his or her dependents under: - the Canada and Quebec Pension Plans; - the Railroad Retirement Act; - any local, state, provincial or federal government disability or retirement plan or law payable for Injury or Sickness provided as a result of employment with the Employer; - any sick leave or salary continuation plan of the Employer; - any work loss provision in mandatory "No-Fault" auto insurance. 1.2. any Social Security disability or retirement benefits the Employee or any third party receives (or is assumed to receive*) on his or her own behalf or for his or her dependents; or which his or her dependents receive (or are assumed to receive*) because of his or her entitlement to such benefits. 1.3. any Retirement Plan benefits funded by the Employer. "Retirement Plan" means any defined benefit or defined contribution plan sponsored or funded by the Employer. It does not include an individual deferred compensation agreement; a profit sharing or any other retirement or savings plan maintained in addition to a defined benefit or other defined contribution pension plan, or any employee savings plan including a thrift, stock option or stock bonus plan, individual retirement account or 40l(k) plan. 1.4. any proceeds payable under any group insurance or similar plan. If other insurance applies to the same claim for Disability, and contains the same or similar provision for reduction because of other insurance, the Insurance Company will pay for its pro rata share of the total claim. "Pro rata share" means the proportion of the total benefit that the amount payable under one policy, without other insurance, bears to the total benefits under all such policies. 1.5. any amounts received (or assumed to be received*) by the Employee or his or her dependents under any workers' compensation, occupational disease, unemployment compensation law or similar state or federal law payable for Injury or Sickness arising out of work with the Employer, including all permanent and temporary disability benefits. This includes any damages, compromises or settlement paid in place of such benefits, whether or not liability is admitted. 1.6. any amounts paid because of loss of earnings or earning capacity through settlement, judgment, arbitration or otherwise, where a third party may be liable, regardless of whether liability is determined. Dependents include any person who receives (or is assumed to receive*) benefits under any applicable law because of an Employee’s entitlement to benefits. *See the Assumed Receipt of Benefits provision. Increases in Other Income Benefits Any increase in Other Income Benefits during a period of Disability due to a cost of living adjustment will not be considered in calculating the Employee’s Disability Benefits after the first reduction is made for any Other Income Benefits. This section does not apply to any cost of living adjustment for Disability Earnings. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 50 of 75 16 Lump Sum Payments Other Income Benefits or earnings paid in a lump sum will be prorated over the period for which the sum is given. If no time is stated, the lump sum will be prorated over five years. If no specific allocation of a lump sum payment is made, then the total payment will be an Other Income Benefit. Assumed Receipt of Benefits The Insurance Company will assume the Employee (and his or her dependents, if applicable) are receiving benefits for which they are eligible from Other Income Benefits. The Insurance Company will reduce the Employee’s Disability Benefits by the amount from Other Income Benefits it estimates are payable to the Employee and his or her dependents. The Insurance Company will waive Assumed Receipt of Benefits, except for Disability Earnings for work the Employee performs while Disability Benefits are payable, if the Employee: 1. provides satisfactory proof of application for Other Income Benefits; 2. signs a Reimbursement Agreement; 3. provides satisfactory proof that all appeals for Other Income Benefits have been made unless the Insurance Company determines that further appeals are not likely to succeed; and 4. submits satisfactory proof that Other Income Benefits were denied. The Insurance Company will not assume receipt of any pension or retirement benefits that are actuarially reduced according to applicable law, until the Employee actually receives them. Social Security Assistance The Insurance Company may help the Employee in applying for Social Security Disability Income (SSDI) Benefits, and may require the Employee to file an appeal if it believes a reversal of a prior decision is possible. The Insurance Company will reduce Disability Benefits by the amount it estimates the Employee will receive, if the Employee refuses to cooperate with or participate in the Social Security Assistance Program. Recovery of Overpayment The Insurance Company has the right to recover any benefits it has overpaid. The Insurance Company may use any or all of the following to recover an overpayment: 1. request a lump sum payment of the overpaid amount; 2. reduce any amounts payable under this Policy; and/or 3. take any appropriate collection activity available to it. The Minimum Benefit amount will not apply when Disability Benefits are reduced in order to recover any overpayment. If an overpayment is due when the Employee dies, any benefits payable under the Policy will be reduced to recover the overpayment. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 51 of 75 17 Successive Periods of Disability A separate period of Disability will be considered continuous: 1. if it results from the same or related causes as a prior Disability for which benefits were payable; and 2. if, after receiving Disability Benefits, the Employee returns to work in his or her Regular Occupation for less than 6 consecutive months; and 3. if the Employee earns less than the percentage of Indexed Earnings that would still qualify him or her to meet the definition of Disability/Disabled during at least one month. Any later period of Disability, regardless of cause, that begins when the Employee is eligible for coverage under another group disability plan provided by any employer will not be considered a continuous period of Disability. For any separate period of disability which is not considered continuous, the Employee must satisfy a new Elimination Period. LIMITATIONS Limited Benefit Periods for Mental or Nervous Disorders The Insurance Company will pay Disability Benefits on a limited basis during an Employee's lifetime for a Disability caused by, or contributed to by, any one or more of the following conditions. Once 24 monthly Disability Benefits have been paid, no further benefits will be payable for any of the following conditions. a) Anxiety disorders b) Delusional (paranoid) disorders c) Depressive disorders d) Eating disorders e) Mental illness f) Somatoform disorders (psychosomatic illness) If, before reaching his or her lifetime maximum benefit, an Employee is confined in a hospital for more than 14 consecutive days, that period of confinement will not count against his or her lifetime limit. The confinement must be for the Appropriate Care of any of the conditions listed above. Limited Benefit Periods for Alcoholism and Drug Addiction or Abuse The Insurance Company will pay Disability Benefits on a limited basis during an Employee's lifetime for a Disability caused by, or contributed to by, any one or more of the following conditions. Once 24 monthly Disability Benefits have been paid, no further benefits will be payable for any of the following conditions. 1) Alcoholism 2) Drug addiction or abuse If, before reaching his or her lifetime maximum benefit, an Employee is confined in a hospital for more than 14 consecutive days, that period of confinement will not count against his or her lifetime limit. The confinement must be for the Appropriate Care of any of the conditions listed above. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 52 of 75 18 Pre-Existing Condition Limitation The Insurance Company will not pay benefits for any period of Disability caused or contributed to by, or resulting from, a Pre-existing Condition. A "Pre-existing Condition" means any Injury or Sickness for which the Employee incurred expenses, received medical treatment, care or services including diagnostic measures, or took prescribed drugs or medicines within 3 months before his or her most recent effective date of insurance. The Pre-existing Condition Limitation will apply to any added benefits or increases in benefits. This limitation will not apply to a period of Disability that begins after an Employee is covered for at least 12 months after his or her most recent effective date of insurance, or the effective date of any added or increased benefits. TL-007500.44 ADDITIONAL BENEFITS Rehabilitation During a Period of Disability If the Insurance Company determines that a Disabled Employee is a suitable candidate for rehabilitation, the Insurance Company may require the Employee to participate in a Rehabilitation Plan and assessment at our expense. The Insurance Company has the sole discretion to approve the Employee's participation in a Rehabilitation Plan and to approve a program as a Rehabilitation Plan. The Insurance Company will work with the Employee, the Employer and the Employee's Physician and others, as appropriate, to perform the assessment, develop a Rehabilitation Plan, and discuss return to work opportunities. The Rehabilitation Plan may, at the Insurance Company's discretion, allow for payment of the Employee's medical expense, education expense, moving expense, accommodation expense or family care expense while he or she participates in the program. If an Employee fails to fully cooperate in all required phases of the Rehabilitation Plan and assessment without Good Cause, no Disability Benefits will be paid, and insurance will end. TL-007501.00 Catastrophic Disability Benefit Definitions The definitions that follow apply to this benefit provision. They are in addition to those definitions in the General Definitions section. “Activities of Daily Living” are: 1. Bathing (i.e., washing oneself in a shower or tub, including getting into or out of the tub or shower, or washing oneself by sponge bath.) 2. Dressing oneself by putting on and taking off from one’s own body all items of clothing and needed braces, fasteners and artificial limbs. 3. Continence (i.e., the ability to maintain control one’s own bowel and bladder function; or when unable to maintain bowel or bladder function, the ability to perform associated hygiene, including caring for a catheter or colostomy bag). 4. Toileting oneself by getting to and from the toilet, getting on and off the toilet, and performing personal hygiene associated with toileting. 5. Feeding oneself by getting nourishment into the one’s own body either from eating food that is made available to you in receptacle such as a plate, cup or table, or by feeding oneself by a feeding tube or intravenously. 6. Transferring (i.e., the ability to get oneself into or out of a bed, a chair or wheelchair; or the ability to move from place to place either by walking, use of a wheelchair, or some other means. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 53 of 75 19 “Catastrophic Disability” means the Employee is: 1. Unable to perform, without Substantial Assistance, at least two Activities of Daily Living, or 2. Has a severe Cognitive Impairment that requires Substantial Supervision to protect the Employee or others from threats to health and safety. “Cognitive Impairment” means the loss or deterioration in intellectual capacity that meets these requirements: 1. The loss or deterioration in intellectual capacity is comparable to and includes Alzheimer’s disease and similar forms of irreversible dementia; 2. The loss or deterioration in intellectual capacity is measured by clinical evidence and standardized tests that reliably measure impairment in the individual’s short-term and long-term memory, orientation as to person, place, or time and deductive or abstract reasoning. “Substantial Assistance” means the physical assistance of another person without which the Employee would not be able to perform an activity of daily living; or the constant presence of another person within arm’s reach that is necessary to prevent, by physical intervention, injury to the Employee while the Employee is performing an activity of daily living. “Substantial Supervision” means continual oversight that may include cueing by verbal prompting, gestures, or other demonstrations by another person, and which is needed to protect the Employee from threats to health and safety. Benefits Payable Catastrophic Disability Benefits are payable when the Insurer determines that the Employee has a Catastrophic Disability that is due to the same sickness or injury for which Disability Benefits are payable under this Policy. The benefits are payable only while these conditions are met: 1. The Employee is receiving monthly Disability Benefits under the Policy. 2. The Employee’s Catastrophic Disability lasted for at least the Elimination Period duration shown in the Schedule of Benefits. 3. The Employee submits, at his/her own expense, satisfactory proof of Catastrophic Disability to the Insurer, when required by the Insurer. Amount Payable Benefits are payable monthly at the Catastrophic Disability Rate shown is the Schedule of Benefits. This benefit will not be reduced by any other source of income. For periods of less than one month, the Insurer will pay 1/30th of the monthly benefit for Catastrophic Disability for each day. Termination of Benefits Catastrophic Disability Benefits end on the earliest to occur of: 1. the date the Employee’s Catastrophic Disability ends.; 2. the date the Employee is no longer receiving monthly disability benefits under the Policy; 3. the date the Employee fails to submit proof of continuing Catastrophic Disability; or 4. the date the Employee dies. 5. the end of the Maximum Benefit Period shown in the Schedule of Benefits. No survivor benefits are payable for the Catastrophic Disability Benefit. TL-008895-1 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 54 of 75 20 Cost of Living Adjustment (COLA) Benefit Each year the Insurance Company will increase an Employee's Disability Benefit after he or she has been continuously Disabled for the COLA Benefit Waiting Period. The increase will be the lesser of the annual increase in the Consumer Price Index (CPI-W) during the preceding calendar year or the COLA Increase shown in the Schedule of Benefits. The increase will become effective on the COLA Adjustment Date and will be payable for the Maximum Period for COLA Benefits. This benefit does not apply to the Disability Minimum or Maximum Benefit. It does not apply to the formula used to determine Work Incentive Benefits, if any. TL-005101 Survivor Benefit The Insurance Company will pay a Survivor Benefit if an Employee dies while Monthly Benefits are payable. The Employee must have been continuously Disabled for the Survivor Benefit Waiting Period before the first benefit is payable. These benefits will be payable for the Maximum Benefit Period for Survivor Benefits. Benefits will be paid to the Employee's Spouse. If there is no Spouse, benefits will be paid in equal shares to the Employee's surviving Children. If there are no Spouse and no Children, benefits will be paid to the Employee's estate. "Spouse" means an Employee's lawful spouse. "Children" means an Employee's unmarried children under age 21 who are chiefly dependent upon the Employee for support and maintenance. The term includes a stepchild living with the Employee at the time of his or her death. TL-005107 TERMINATION OF DISABILITY BENEFITS Benefits will end on the earliest of the following dates: 1. the date the Employee earns from any occupation, more than the percentage of Indexed Earnings set forth in the definition of Disability applicable to him or her at that time; 2. the date the Insurance Company determines he or she is not Disabled; 3. the end of the Maximum Benefit Period; 4. the date the Employee dies; 5. the date the Employee refuses, without Good Cause, to fully cooperate in all required phases of the Rehabilitation Plan and assessment; 6. the date the Employee is no longer receiving Appropriate Care; 7. the date the Employee fails to cooperate with the Insurance Company in the administration of the claim. Such cooperation includes, but is not limited to, providing any information or documents needed to determine whether benefits are payable or the actual benefit amount due. Benefits may be resumed if the Employee begins to cooperate fully in the Rehabilitation Plan within 30 days of the date benefits terminated. TL-007502.00 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 55 of 75 21 EXCLUSIONS The Insurance Company will not pay any Disability Benefits for a Disability that results, directly or indirectly, from: 1. suicide, attempted suicide, or self-inflicted injury while sane or insane. 2. war or any act of war, whether or not declared. 3. active participation in a riot. 4. commission of a felony. 5. the revocation, restriction or non-renewal of an Employee’s license, permit or certification necessary to perform the duties of his or her occupation unless due solely to Injury or Sickness otherwise covered by the Policy. In addition, the Insurance Company will not pay Disability Benefits for any period of Disability during which the Employee is incarcerated in a penal or corrections institution. TL-007503.00 CLAIM PROVISIONS Notice of Claim Written notice, or notice by any other electronic/telephonic means authorized by the Insurance Company, must be given to the Insurance Company within 31 days after a covered loss occurs or begins or as soon as reasonably possible. If written notice, or notice by any other electronic/telephonic means authorized by the Insurance Company, is not given in that time, the claim will not be invalidated or reduced if it is shown that notice was given as soon as was reasonably possible. Notice can be given at our home office in Philadelphia, Pennsylvania or to our agent. Notice should include the Employer's Name, the Policy Number and the claimant's name and address. Claim Forms When the Insurance Company receives notice of claim, the Insurance Company will send claim forms for filing proof of loss. If claim forms are not sent within 15 days after notice is received by the Insurance Company, the proof requirements will be met by submitting, within the time required under the "Proof of Loss" section, written proof, or proof by any other electronic/telephonic means authorized by the Insurance Company, of the nature and extent of the loss. Claimant Cooperation Provision Failure of a claimant to cooperate with the Insurance Company in the administration of the claim may result in termination of the claim. Such cooperation includes, but is not limited to, providing any information or documents needed to determine whether benefits are payable or the actual benefit amount due. Insurance Data The Employer is required to cooperate with the Insurance Company in the review of claims and applications for coverage. Any information the Insurance Company provides in these areas is confidential and may not be used or released by the Employer if not permitted by applicable privacy laws. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 56 of 75 22 Proof of Loss Written proof of loss, or proof by any other electronic/telephonic means authorized by the Insurance Company, must be given to the Insurance Company within 90 days after the date of the loss for which a claim is made. If written proof of loss, or proof by any other electronic/telephonic means authorized by the Insurance Company, is not given in that 90 day period, the claim will not be invalidated nor reduced if it is shown that it was given as soon as was reasonably possible. In any case, written proof of loss, or proof by any other electronic/telephonic means authorized by the Insurance Company, must be given not more than one year after that 90 day period. If written proof of loss, or proof by any other electronic/telephonic means authorized by the Insurance Company, is provided outside of these time limits, the claim will be denied. These time limits will not apply while the person making the claim lacks legal capacity. Written proof, or proof by any other electronic/telephonic means authorized by the Insurance Company, that the loss continues must be furnished to the Insurance Company at intervals required by us. Within 30 days of a request, written proof of continued Disability and Appropriate Care by a Physician must be given to the Insurance Company. Time of Payment Disability Benefits will be paid at regular intervals of not less frequently than once a month. Any balance, unpaid at the end of any period for which the Insurance Company is liable, will be paid at that time. To Whom Payable Disability Benefits will be paid to the Employee. If any person to whom benefits are payable is a minor or, in the opinion of the Insurance Company, is not able to give a valid receipt, such payment will be made to his or her legal guardian. However, if no request for payment has been made by the legal guardian, the Insurance Company may, at its option, make payment to the person or institution appearing to have assumed custody and support. If an Employee dies while any Disability Benefits remain unpaid, the Insurance Company may, at its option, make direct payment to any of the following living relatives of the Employee: spouse, mother, father, children, brothers or sisters; or to the executors or administrators of the Employee's estate. The Insurance Company may reduce the amount payable by any indebtedness due. Payment in the manner described above will release the Insurance Company from all liability for any payment made. Physical Examination and Autopsy The Insurance Company, at its expense, will have the right to examine any person for whom a claim is pending as often as it may reasonably require. The Insurance Company may, at its expense, require an autopsy unless prohibited by law. Legal Actions No action at law or in equity may be brought to recover benefits under the Policy less than 60 days after written proof of loss, or proof by any other electronic/telephonic means authorized by the Insurance Company, has been furnished as required by the Policy. No such action shall be brought more than 3 years after the time satisfactory proof of loss is required to be furnished. Time Limitations If any time limit stated in the Policy for giving notice of claim or proof of loss, or for bringing any action at law or in equity, is less than that permitted by the law of the state in which the Employee lives when the Policy is issued, then the time limit provided in the Policy is extended to agree with the minimum permitted by the law of that state. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 57 of 75 23 Physician/Patient Relationship The Insured will have the right to choose any Physician who is practicing legally. The Insurance Company will in no way disturb the Physician/patient relationship. TL-004724a (TX) ADMINISTRATIVE PROVISIONS Premiums The premiums for this Policy will be based on the rates currently in force, the plan and the amount of insurance in effect. Changes in Premium Rates The premium rates may be changed by the Insurance Company from time to time with at least 31 days advance written notice. No change in rates will be made until 36 months after the Effective Date. An increase in rates will not be made more often than once in a 12 month period. However, the Insurance Company reserves the right to change the rates even during a period for which the rate is guarantee, if any of the following events take place. 1. The Policy terms change. 2. A division, subsidiary, eligible company, or class is added or deleted. 3. There is a change of more than 10% in the number of Insureds. 4. Federal or state laws or regulation affecting benefit obligations change. 5. Other changes occur in the nature of the risk that would affect the Insurance Company’s original risk assessment. 6. The Insurance Company determines the Employer fails to furnish necessary information. If an increase or decrease in rates takes place on a date that is not a Premium Due Date, a pro rata adjustment will apply from the date of the change to the next Premium Due Date. Reporting Requirements The Employer must, upon request, give the Insurance Company any information required to determine who is insured, the amount of insurance in force and any other information needed to administer the plan of insurance. Payment of Premium The first premium is due on the Policy Effective Date. After that, premiums will be due monthly unless the Employer and the Insurance Company agree on some other method of premium payment. If any premium is not paid when due, the plan will be canceled as of the Premium Due Date, except as provided in the Policy Grace Period section. Notice Of Cancellation The Employer or the Insurance Company may cancel the policy as of any Premium Due Date by giving 31 days advance written notice. If a premium is not paid when due, the Policy will automatically be canceled as of the Premium Due Date, except as provided in the Policy Grace Period section. Policy Grace Period A Policy Grace Period of 31 days will be granted for the payment of the required premiums under this Policy. This Policy will be in force during the Policy Grace Period. The Employer is liable to the Insurance Company for any unpaid premium for the time this Policy was in force. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 58 of 75 24 Grace Period for the Insured If the required premium is not paid on the Premium Due Date, there is a 31 day grace period after each premium due date after the first. If the required premium is not paid during the grace period, insurance will end on the last day for which premium was paid. Reinstatement of Insurance An Employee’s insurance may be reinstated if it ends because he or she is on an unpaid leave of absence. If an Employee’s Active Service ended due to an approved leave pursuant to the Family and Medical Leave Act (FMLA) and Continuation of Insurance is not applicable, an Employee’s insurance may be reinstated at the conclusion of the FMLA leave. If an Employee’s Active Service ends due to an Employer approved unpaid leave of absence, other than an approved FMLA leave, insurance may be reinstated only: 1. If the reinstatement occurs within 12 weeks from the date insurance ends, or 2. When returning from military service pursuant to the Uniformed Services Employment Act of 1994 (USERRA). For insurance to be reinstated the following conditions must be met: 1. An Employee must be in a Class of Eligible Employees. 2. The required premium must be paid. 3. The Insurance Company must receive a written request for reinstatement within 31 days from the date an Employee returns to Active Service. Reinstated insurance will be effective on the date the Employee returns to Active Service. If an Employee did not fully satisfy the Eligibility Waiting Period or the Pre-Existing Condition Limitation (if any) before insurance ended due to an unpaid leave of absence, credit will be given for any time that was satisfied. TL-009960.00 GENERAL PROVISIONS Entire Contract The entire contract will be made up of the Policy, the application of the Employer, a copy of which is attached to the Policy, and the applications, if any, of the Insureds. Incontestability All statements made by the Employer or by an Insured are representations not warranties. No statement will be used to deny or reduce benefits or as a defense to a claim, unless a copy of the instrument containing the statement is signed by and has been furnished to the claimant. In the event of death or legal incapacity, the beneficiary or representative must receive the copy. After two years from an Insured's effective date of insurance, or from the effective date of any added or increased benefits, the validity of an Insured's coverage will not be contested using such statements. Misstatement of Age If an Insured's age has been misstated, the Insurance Company will adjust all benefits to the amounts that would have been purchased for the correct age. Policy Changes No change in the Policy will be valid until approved by an executive officer of the Insurance Company. This approval must be endorsed on, or attached to, the Policy. No agent may change the Policy or waive any of its provisions. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 59 of 75 25 Workers' Compensation Insurance The Policy is not in lieu of and does not affect any requirements for insurance under any Workers' Compensation Insurance Law. Certificates An individual certificate of insurance will be delivered to the Employer for delivery to Insureds. Each certificate will list the benefits, conditions and limits of the Policy. It will state to whom benefits will be paid. Assignment of Benefits The Insurance Company will not be affected by the assignment of an Insured's certificate until the original assignment or a certified copy of the assignment is filed with the Insurance Company. The Insurance Company will not be responsible for the validity or sufficiency of an assignment. An assignment of benefits will operate so long as the assignment remains in force provided insurance under the Policy is in effect. This insurance may not be levied on, attached, garnisheed, or otherwise taken for a person's debts. This prohibition does not apply where contrary to law. Clerical Error A person's insurance will not be affected by error or delay in keeping records of insurance under the Policy. If such an error is found, the premium will be adjusted fairly. Agency The Employer and Plan Administrator are agents of the Employee for transactions relating to insurance under the Policy. The Insurance Company is not liable for any of their acts or omissions. TL-004726a (TX) DEFINITIONS Please note, certain words used in this document have specific meanings. These terms will be capitalized throughout this document. The definition of any word, if not defined in the text where it is used, may be found either in this Definitions section or in the Schedule of Benefits. Active Service An Employee is in Active Service on a day which is one of the Employer's scheduled work days if either of the following conditions are met. 1. The Employee is performing his or her regular occupation for the Employer on a full-time basis. He or she must be working at one of the Employer's usual places of business or at some location to which the employer's business requires an Employee to travel. 2. The day is a scheduled holiday or vacation day and the Employee was performing his or her regular occupation on the preceding scheduled work day. An Employee is in Active Service on a day which is not one of the Employer's scheduled work days only if he or she was in Active Service on the preceding scheduled work day. Annual Enrollment Period The period in each calendar year when an eligible Employee may enroll for or change benefit elections under the Policy. This period must be agreed upon by the Employer and the Insurance Company. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 60 of 75 26 Appropriate Care Appropriate Care means the Employee: 1. Has received treatment, care and advice from a Physician who is qualified and experienced in the diagnosis and treatment of the conditions causing Disability. If the condition is of a nature or severity that it is customarily treated by a recognized medical specialty, the Physician is a practitioner in that specialty. 2. Continues to receive such treatment, care or advice as often as is required for treatment of the conditions causing Disability. 3. Adheres to the treatment plan prescribed by the Physician, including the taking of medications. Consumer Price Index (CPI-W) The Consumer Price Index for Urban Wage Earners and Clerical Workers published by the U.S. Department of Labor. If the index is discontinued or changed, another nationally published index that is comparable to the CPI-W will be used. Disability Earnings Any wage or salary for any work performed for any employer during the Employee’s Disability, including commissions, bonus, overtime pay or other extra compensation. Employee For eligibility purposes, an Employee is an employee of the Employer in one of the "Classes of Eligible Employees." Otherwise, Employee means an employee of the Employer who is insured under the Policy. Employer The Policyholder and any affiliates or subsidiaries covered under the Policy. The Employer is acting as an agent of the Insured for transactions relating to this insurance. The actions of the Employer shall not be considered the actions of the Insurance Company. Full-time Full-time means the number of hours set by the Employer as a regular work day for Employees in the Employee's eligibility class. Furlough Furlough means a temporary suspension or alteration of Active Service initiated by the Employer, for a period of time specified in advance not to exceed 30 days at a time. Good Cause A medical reason preventing participation in the Rehabilitation Plan. Satisfactory proof of Good Cause must be provided to the Insurance Company. Indexed Earnings For the first 12 months Monthly Benefits are payable, Indexed Earnings will be equal to Covered Earnings. After 12 Monthly Benefits are payable, Indexed Earnings will be an Employee's Covered Earnings plus an increase applied on each anniversary of the date Monthly Benefits became payable. The amount of each increase will be the lesser of: 1. 10% of the Employee's Indexed Earnings during the preceding year of Disability; or 2. the rate of increase in the Consumer Price Index (CPI-W) during the preceding calendar year. Injury Any accidental loss or bodily harm which results directly and independently of all other causes from an Accident. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 61 of 75 27 Insurability Requirement An eligible person will satisfy the Insurability Requirement for an amount of coverage on the day the Insurance Company agrees in writing to accept him or her as insured for that amount. To determine a person's acceptability for coverage, the Insurance Company will require evidence of good health and may require it be provided at the Employee's expense. Insurance Company The Insurance Company underwriting the Policy is named on the Policy cover page. Insured A person who is eligible for insurance under the Policy, for whom insurance is elected, the required premium is paid and coverage is in force under the Policy. Physician Physician means a licensed doctor practicing within the scope of his or her license and rendering care and treatment to an Insured that is appropriate for the condition and locality. The term does not include an Employee, an Employee's spouse, the immediate family (including parents, children, siblings or spouses of any of the foregoing, whether the relationship derives from blood or marriage), of an Employee or spouse, or a person living in an Employee's household. Prior Plan The Prior Plan refers to the plan of insurance providing similar benefits sponsored by the Employer in effect directly prior to the Policy Effective Date. A Prior Plan will include the plan of a company in effect on the day prior to that company's addition to this Policy after the Policy Effective Date. Regular Occupation The occupation the Employee routinely performs at the time the Disability begins. In evaluating the Disability, the Insurance Company will consider the duties of the occupation as it is normally performed in the general labor market in the national economy. It is not work tasks that are performed for a specific employer or at a specific location. Rehabilitation Plan A written plan designed to enable the Employee to return to work. The Rehabilitation Plan will consist of one or more of the following phases: 1. rehabilitation, under which the Insurance Company may provide, arrange or authorize educational, vocational or physical rehabilitation or other appropriate services; 2. work, which may include modified work and work on a part-time basis. Sickness Any physical or mental illness. Temporary Layoff Temporary Layoff means a temporary suspension of Active Service for a period of time determined in advance by the Employer, other than a Furlough as defined. Temporary Layoff does not include the permanent termination of Active Service (including but not limited to a job elimination), which shall be treated as termination of employment. TL-007500.44 as modified by TL-009980 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 62 of 75 28 LIFE INSURANCE COMPANY OF NORTH AMERICA (herein called the Insurance Company) AMENDATORY RIDER CLAIM PROCEDURES APPLICABLE TO PLANS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT (“ERISA”) The provisions below amend the Policy to which they are attached. They apply to all claims for benefits under the Policy. They supplement other provisions of the Policy relating to claims for benefits, but nothing contained in the rider will alter or affect the insurance company’s duty to comply with any applicable state law or regulation which requires any action to be taken with respect to any claim within any specific period of time. This Policy has been issued in conjunction with an employee welfare benefit plan subject to the Employee Retirement Income Security Act of 1974 (“ERISA”). This Policy is a Plan document within the meaning of ERISA. As respects the Insurance Company, it is the sole contract under which benefits are payable by the Insurance Company. Except for this, it shall not be deemed to affect or supersede other Plan documents. The Plan Administrator has appointed the Insurance Company as the named fiduciary for deciding claims for benefits under the Plan, and for deciding any appeals of denied claims. Review of Claims for Benefits The Insurance Company has 45 days from the date it receives a claim for disability benefits, or 90 days from the date it receives a claim for any other benefit, to determine whether or not benefits are payable in accordance with the terms of the Policy. The Insurance Company may require more time to review the claim if necessary due to matters beyond its control. If this should happen, the Insurance Company must provide notice in writing that its review period has been extended for: (i) up to two more 30 day periods (in the case of a claim for disability benefits); or (ii) 90 days more (in the case of any other benefit). If this extension is made because additional information must be furnished, these extension periods will begin when the additional information is received. The requested information must be furnished within 45 days. During the review period, the Insurance Company may require: (i) a medical examination of the Insured, at its own expense; or (ii) additional information regarding the claim. If a medical examination is required, the Insurance Company will notify the Insured of the date and time of the examination and the physician's name and location. If additional information is required, the Insurance Company must notify the claimant, in writing, stating what information is needed and why it is needed. If the claim is approved, the Insurance Company will pay the appropriate benefit. If the claim is denied, in whole or in part, the Insurance Company will provide written notice within the review period. The Insurance Company's written notice will include the following information: 1. The specific reason(s) the claim was denied. 2. Specific reference to the Policy provision(s) on which the denial was based. 3. Any additional information required for the claim to be reconsidered, and the reason this information is necessary. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 63 of 75 29 4. In the case of any claim for a disability benefit: identification of any internal rule, guideline or protocol relied on in making the claim decision, and an explanation of any medically-related exclusion or limitation involved in the decision. 5. A statement regarding the right to appeal the decision, and an explanation of the appeal procedure, including a statement of the right to bring a civil action under Section 502(a) of ERISA if the appeal is denied. Appeal Procedure for Denied Claims Whenever a claim is denied, there is the right to appeal the decision. A written request for appeal must be made to the Insurance Company within 60 days (180 days in the case of any claim for disability benefits) from the date the denial was received. If a request is not made within that time, the right to appeal will have been waived. Once a request has been received by the Insurance Company, a prompt and complete review of the claim will take place. This review will give no deference to the original claim decision. It will not be made by the person who made the initial claim decision, or a subordinate of that person. During the review, the claimant (or the claimant’s duly authorized representative) has the right to review any documents that have a bearing on the claim, including the documents which establish and control the Plan. Any medical or vocational experts consulted by the Insurance Company will be identified. Issues and comments that might affect the outcome of the review may also be submitted. The Insurance Company has 60 days (45 days, in the case of any disability benefit) from the date it receives a request to review the claim and provide its decision. Under special circumstances, the Insurance Company may require more time to review the claim. If this should happen, the Insurance Company must provide notice, in writing, that its review period has been extended for an additional 60 days (45 days in the case of any disability benefit). Once its review is complete, the Insurance Company must state, in writing, the results of the review and indicate the Plan provisions upon which it based its decision. Matthew G. Manders, President TL-009000-1 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 64 of 75 30 IMPORTANT CHANGES FOR STATE REQUIREMENTS If an Employee resides in one of the following states, the provisions of the certificate are modified for residents of the following states. The modifications listed apply only to residents of that state. Louisiana residents: The percentage of Indexed Earnings, if any, that qualifies an insured to meet the definition of Disability/Disabled may not be less than 80%. Minnesota residents: The Pre-existing Condition Limitation, if any, may not be longer than 24 months from the insured’s most recent effective date of insurance. Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 65 of 75 LIFE INSURANCE COMPANY OF NORTH AMERICA PHILADELPHIA, PA 19192-2235 We, Martin Resource Management Corporation, whose main office address is Kilgore, TX, hereby approve and accept the terms of Group Policy Number VDT-960981 issued by the LIFE INSURANCE COMPANY OF NORTH AMERICA. This form is to be signed in duplicate. One part is to be retained by Martin Resource Management Corporation; the other part is to be returned to the LIFE INSURANCE COMPANY OF NORTH AMERICA. Martin Resource Management Corporation Signature and Title: _________________________________________ Date:__________________________ (This Copy Is To Be Returned To LIFE INSURANCE COMPANY OF NORTH AMERICA) -------------------------------------------------------------------------------------------------------------------------------------- LIFE INSURANCE COMPANY OF NORTH AMERICA PHILADELPHIA, PA 19192-2235 We, Martin Resource Management Corporation, whose main office address is Kilgore, TX, hereby approve and accept the terms of Group Policy Number VDT-960981 issued by the LIFE INSURANCE COMPANY OF NORTH AMERICA. This form is to be signed in duplicate. One part is to be retained by Martin Resource Management Corporation; the other part is to be returned to the LIFE INSURANCE COMPANY OF NORTH AMERICA. Martin Resource Management Corporation Signature and Title: _________________________________________ Date:__________________________ (This Copy Is To Be Retained By Martin Resource Management Corporation) Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 66 of 75 Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 67 of 75 EXHIBIT C Case 2:16-cv-17271-ILRL-JCW Document 26-3 Filed 03/24/17 Page 68 of 75 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 41 of 776 172 1 ILRL JCW 6 3 3 24 7 69 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 42 of 776 172 1 ILRL JCW 6 3 3 24 7 70 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 43 of 776 172 1 ILRL JCW 6 3 3 24 7 71 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 44 of 776 172 1 ILRL JCW 6 3 3 24 7 72 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 45 of 776 172 1 ILRL JCW 6 3 3 24 7 73 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 46 of 776 172 1 ILRL JCW 6 3 3 24 7 74 5 Case 2:15-cv-06878-LMA-KWR Document 29-2 Filed 08/12/16 Page 47 of 776 172 1 ILRL JCW 6 3 3 24 7 75 5 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA RUSTY NORMAN and WEYMAN MAXSON, on behalf of themselves and all others similarly situated, Plaintiffs, vs. LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant. * * * * * * * * * * * * Case No. 2:16-cv-17271 Judge: Ivan L.R. Lemelle Magistrate Judge: Joseph C. Wilkinson, Jr. NOTICE OF SUBMISSION PLEASE TAKE NOTICE that Defendant, Life Insurance Company of North America, will submit its Motion to Dismiss and Motion to Strike Class Allegations for hearing before the Honorable Ivan L. R. Lemelle, United States District Court for the Eastern District of Louisiana, on the 10th day of May 2017 at 9:30 a.m. Respectfully Submitted, LIFE INSURANCE COMPANY OF NORTH AMERICA By: /s/ Peter Shadzik One of Its Attorneys JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Case 2:16-cv-17271-ILRL-JCW Document 26-4 Filed 03/24/17 Page 1 of 3 2 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: (504) 846-8464 Fax: (800) 977-8810 lwelch@mcsalaw.com Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26-4 Filed 03/24/17 Page 2 of 3 CERTIFICATE OF SERVICE I hereby certify that on March 24, 2017 a copy of the foregoing pleading was filed electronically with the Clerk of Court using the CM/ECF system. Notice of this filing will be sent to all counsel of record by operation of the Court’s electronic filing system. /s/ Peter Shadzik JEREMY P. BLUMENFELD, Trial Counsel MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 1701 Market Street Philadelphia, PA 19103-2921 Phone: 215-963-5000 Fax: 215-963-5001 jeremy.blumenfeld@morganlewis.com STEPHANIE L. SWEITZER MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 77 West Wacker Drive, Suite 500 Chicago, Illinois 60601-5094 Phone: 312-324-1000 Fax: 312-324-1001 stephanie.sweitzer@morganlewis.com PETER SHADZIK MORGAN, LEWIS & BOCKIUS LLP (admitted pro hac vice) 101 Park Avenue New York, NY 10178-0060 Phone: 212-309-6000 Fax: 212-309-6001 peter.shadzik@morganlewis.com LAUREN A. WELCH (La. Bar. 17199) McCRANIE SISTRUNK ANZELMO HARDY McDANIEL & WELCH LLC 909 Poydras Street, Suite 1000 New Orleans, LA 70112 Phone: 504-846-8464 Fax: 800-977-8810 lwelch@mcsalaw.com Attorneys for Defendant Life Insurance Company of North America Case 2:16-cv-17271-ILRL-JCW Document 26-4 Filed 03/24/17 Page 3 of 3
