Plaintiff appealed the denial of her claim. AR 609-617. She submitted additional medical records and reports from Dr. Ho and Dr. Lowe, articles regarding chronic fatigue syndromeand declarations from her friends and family attesting to her disability. AR 618-806. In support of her appeal, Dr. Ho wrote:
The nature of Ellie’s condition is that of an unpredictable and uncontrollable relapse into a severely weakened, debilitated and exhausted state that often times renders her bedbound or housebound. Such a condition usually lasts at least 1-2 weeks. No employer can tolerate that type of inconsistent attendance and loss of productivity. The only predictable aspect of her condition is that whenever she overextends her capabilities and endurance, she will be extremely weakened and afflicted for a number of days. These innumerable episodes of affliction are well documented in my records. As even Dr. Kimmelman [sic] concludes, her condition is “very believable and her medical records corroborate the symptoms such as she claims.”
Hartford again sent Plaintiff’s files, including documents Plaintiff submitted on appeal, to the UDC, which arranged for Dr. Thomas Cuevas, who is Board-Certified in Internal Medicine, to review them. AR 1201. Dr. Cuevas was instructed to review medical records, surveillance evidence, accompanying reports and the Claimant Interview and to contact Drs. Ho and Lowe to discuss Plaintiff’s condition and level of functionality. Dr. Ho, however, would not speak to Dr. Cuevas about his patient’s medical condition without her lawyer present. AR 1202. Dr. Cuevas spoke with Dr. Lowe, who stated that Plaintiff “had more than just fibromyalgia.” AR 1219. Dr. Lowe described Plaintiff’s condition as a “lupus-like syndrome” that manifests polyarthralgias and elevated ANA, and stated that he would expect Plaintiff to have a difficult time working. When asked about specific restrictions and limitations, Dr. Lowe indicated that was a controversial issue in conditions, like Plaintiff’s, involving chronic fatigue and fibromyalgia. Dr. Lowe stated that “it was very difficult to prescribe restrictions and limitations and he stated that he had no opinion regarding her restrictions and limitations.” AR 1219.
*8 In his September 14, 2004 report, Dr. Cuevas concluded that the medical findings supported the diagnostic classification of chronic fatigue syndrome. AR 1220. But he also concluded that “the medical findings do not support impairment in the ability to perform sedentary work on a full-time basis.” AR 1221. Before reaching his conclusion regarding Plaintiff’s ability to work, Dr. Cuevas noted:
In this case, although there is very little information to establish her activity level as far as any information that can be gained from the medical findings, there is a consistent report of difficulty with activity on a consistent basis to provide support for an initial period of impairment…. Although it is repeatedly reported that her condition is fluctuating and unpredictable, the claimant was reported to have “run for a local school board in her city and won.” Thus, she elected to involve herself in activities which required future planning and commitments. Thus, the records of medical encounters and office visits offer no information with which to measure her activity level.
In such situations where the activity level cannot reasonably be determined from the clinical information, non-medical surveillance may be of value. In this case, non-medical evaluation conducted on six different days showed her actively performing activities of daily living without any observable impairment and showed her walking for one hour without any visible impairment during the entire time that she walked for that reported hour. To the extent that the time she was placed under surveillance are [sic] a representative example of her activity level and as she reported that she only goes out on good days, the medical findings support her ability to engage in activities of daily living without impairment and supports [sic] the ability to work without restrictions at least at a sedentary level on a full-time basis.
On September 17, 2004, Hartford completed its review of Plaintiff’s appeal. It upheld its former determination that effective December 16, 2003, Plaintiff “no longer satisfies the policy’s definition of disability.” AR 1131-35.
ERISA provides Plaintiff with a federal cause of action to recover the benefits she claims are due under the LTD Plan. 29 U.S.C. § 1132(a)(1)(B). The standard of review of a plan administrator’s denial of ERISA benefits depends upon the terms of the benefit plan. Absent contrary language in the plan, the denial is reviewed under a de novo standard. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). However, if “the benefit plan expressly gives the plan administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the plan’s terms,” an abuse of discretion standard is applied. Id. at 102; Taft v. Equitable Life Assurance Soc’y, 9 F.3d 1469, 1471 (9th Cir.1993). The Ninth Circuit has also referred to this as an “arbitrary and capricious” standard. McKenzie v. Gen. Tel. Co. of Cal., 41 F.3d 1310, 1314 & n. 3 (9th Cir.1994); Taft, 9 F.3d at 1471 n. 2 (use of the term “arbitrary and capricious” versus “abuse of discretion” is a “distinction without a difference”).Discussion
I. Standard of Review
*9 Plaintiff argues that, because the LTD Plan did not explicitly reserve discretion to Defendants, the Court should review de novo Defendants’ denial of her benefits. Defendants respond that the LTD Plan did confer discretionary authority on them, and their determination should be reviewed for abuse of discretion.
The General Provisions in Section VI of the Group Benefits Plan include the following: “Hartford has full discretion and authority to determine eligibility for benefits and to construe and interpret all terms and provisions of the Group Insurance Policy.” AR 599. There is no question that this language confers discretionary authority. But, as Plaintiff notes, this language is not found in the section for long-term disability benefits; instead, it is contained in the life insurance benefits section. Plaintiff asserts that this language conferring discretionary authority applies to life insurance claims only, and not to long term disability claims. According to Plaintiff, the language that applies to long-term disability claims, and is appropriately found in the long-term disability benefits section, provides, “Hartford reserves the right to determine if proof of loss is satisfactory.” AR 587.
Defendants respond that the “General Provisions” language applies to all claims for long-term disability benefits as well as life insurance benefits. They note that the Group Benefits Plan covers both disability claims and life insurance claims and contains only one General Provisions section. The Group Benefits Plan likewise contains only one ERISA section setting forth Plaintiff’s rights and, because that applies to both long-term disability benefits and life insurance benefits, Defendants argue that the General Provisions section applies to both long-term disability benefits and life insurance benefits as well.
These arguments, however, are unpersuasive. As Defendants note, under the federal common law of ERISA, terms in ERISA insurance polices must be interpreted “in an ordinary and popular sense,” as they would be interpreted by “a person of average intelligence and experience.” Padfield v. AIG Life Ins. Co., 290 F.3d 1121, 1125 (9th Cir.2002). A person of average intelligence and experience would not think that the General Provisions language, found only in the section discussing life insurance benefits, applies to long-term disability benefits. First, long term benefits and life insurance benefits are separate sections of the Group Benefits Plan, and each has its own separate, and different, table of contents. AR 578, 589. The language in the claims section of the life insurance plan is completely different from the language in the claims section of the LTD Plan. AR 587, 599. There is no “Exclusions” section in the life insurance benefits portion, but the LTD Plan contains a section for “Exclusions” that clearly applies only to the LTD Plan, and not to the life insurance plan. See AR 587 (“EXCLUSIONS: This plan does not cover and no benefit shall be paid for any Disability which ….”). As Plaintiff notes, the “General Provisions” section appears just above the section entitled “Changing your Beneficiary,” which has nothing to do with a disability claim. And the ERISA statement is clearly marked as its own separate section of the Group Benefits Plan; a person of reasonable intelligence and experience would not think that the ERISA statement applies only to the life insurance plan. Thus, it would be reasonable to interpret the General Provisions section as applying only to the life insurance plan.
*10 The Ninth Circuit has made clear that an administrator has discretion only where discretion is “unambiguously retained.” Kearney v. Standard Ins. Co.,175 F.3d 1084, 1090 (9th Cir.1999)(en banc); see also Sandy v. Reliance Standard Life Ins. Co.,222 F.3d 1202, 1207 (9th Cir.2000). The Court finds that the administrator has not unambiguously retained discretion over the LTD plan based on the discretionary language located in the life insurance section.
Thus, the Court now turns to the language found in the LTD Plan itself to determine whether that language is unambiguous. Plaintiff argues that the language, “Hartford reserves the right to determine if proof of loss is satisfactory,” is similar to language the court reviewed in Sandy. In Sandy, the court held that a plan provision requiring a participant to “submit satisfactory proof of total disability” to the plan administrator did not unambiguously confer discretion under Kearney.222 F.3d at 1204. The court stated that “unlike other plan provisions we have held conferred discretion,” the plan in question provided “no language conferring authority on Reliance to determine eligibility, to construe the terms of the Plan, or to make a final and binding decision.” Id.at 1205.
Defendants correctly note that the language in Sandy is different because, here, Hartford states that it “reserves the right to determine if proof is satisfactory.” In Sandy, the plan only required the claimant to submit satisfactory proof. Defendants argue that the language here makes clear to the reader that Hartford will have the right to determine whether a claim is payable. But they cite no case where a court found similar language in a plan to confer discretion. As in Sandy, the language here could mean that Hartford reserves the right to determine the forms and supporting documents required for a proof of loss submission.
The language here does not confer discretion to determine eligibility and construe the terms of the plan as clearly as did the language in cases where abuse of discretion review was found. See, e.g., Jordan v. Northrop Grumman Corp. Welfare Benefit Plan,370 F.3d 869, 875 (9th Cir.2004)(“Travelers has the discretion to construe and interpret the terms of the Plan and the authority and responsibility to make factual determinations.”); Friedrich v. Intel Corp.,181 F.3d 1105, 1110 n. 5 (9th Cir.1999)(finding language providing Intel “shall have the sole discretion to interpret the terms of the Plan and to determine eligibility for benefits” sufficient to retain discretion). And, as the Ninth Circuit has ruled, “Merely using the word ‘determine’ in the policy does not insure that the denial of benefits will be reviewed for abuse of discretion.” Newcomb v. Standard Ins. Co.,187 F.3d 1004, 1006 (9th Cir.1999).
Here, the language arguably confers discretion; but if “language only ‘arguably’ confers discretion, then by definition, it does not confer discretion ‘unambiguously,’ the requirement for deferential review.” Green v. Sun Life Assur. Co. of Canada, 383 F.Supp.2d 1224, 1227 (C.D.Cal.2005). As the court noted in Sandy, “Neither the parties nor the courts should have to divine whether discretion is conferred. It either is, in so many words, or it isn’t .” 222 F.3d at 1207. Because the language does not unambiguously “say in sum or substance” that Hartford “has authority, power, or discretion to determine eligibility or to construe the terms of the Plan, the standard of review will be de novo.” Id.II. De Novo Review
*11 Defendants argue that, even under a de novo standard, their decision to terminate Plaintiff’s benefits must be upheld, because Plaintiff’s claim of total disability from any occupation is not supported by the record. Of the three doctors Defendants rely upon to support their termination of benefits, however, only one, Dr. Kimelman, actually examined Plaintiff. As noted above, Dr. Kimelman found Plaintiff to be believable. He further found that Plaintiff’s symptoms on the day he examined her were minimal, and that her objective factors noted on the day he examined her would allow her to perform a sedentary occupation. Dr. Kimelman’s report was clear that his finding, that Plaintiff could return to work in a sedentary occupation, was based on how Plaintiff was feeling and performing on that day. See AR 137 (“on today’s examination”; “her objective factors noted today”). But, as explained by the Third Circuit, “CFS does not disable an individual afflicted with it from performing particular, isolated activities, but rather prevents him from performing all activities for any prolonged period of time.” Mitchell v. Eastman Kodak Co.,113 F.3d 433, 441 n. 7 (3d Cir.1997)(emphasis in original). Dr. Kimelman was silent regarding whether Plaintiff could perform any of the objective functions over a prolonged period of time, as were the other two doctors Defendants hired to review Plaintiff’s records.
The doctors noted that Plaintiff was observed on the video surveillance walking, driving and doing errands; however, doing those activities for a couple of hours on five out of the six days she was under surveillance does not mean that Plaintiff is able to work an eight-hour a day job. Attending a two-hour weekly committee meeting for ten consecutive weeks is not equal to working eight-hours a day, five days a week, week after week, month after month. Nor is sitting attentively for four hours while being interviewed and then going with a friend to the doctor the equivalent of working on a full-time basis.
Defendants acknowledged at the hearing that Plaintiff would still be “totally disabled” under the LTD Plan if she could work four hours a day; Plaintiff is totally disabled unless she is able to work full-time in “any occupation,” for which she is, or could be, qualified. But the two doctors who reviewed Plaintiff’s records, and did not examine Plaintiff, offered no convincing evidence to show that Plaintiff could work an eight-hour day, even at a sedentary job. Dr. Siegel stated that Dr. Kimelman’s medical evaluation of Plaintiff supports that she is capable of sedentary work; however, as discussed above, that report was based only on Plaintiff’s symptoms on that particular day and did not discuss Plaintiff’s abilities to perform objective functions for any prolonged period of time. Based on his review of the medical records and the surveillance video, Dr. Seigel further concluded Plaintiff should be physically capable of performing full-time sedentary to light duty work activities. Reviewing the Plaintiff’s medical record and watching the surveillance tape, the Court did not reach the same conclusion.
*12 Dr. Cuevas relied, in part, upon a note in Plaintiff’s medical record that Plaintiff ran for the local school board and won, to support his conclusion that Plaintiff has the ability to work without restrictions at a sedentary level on a full-time basis. Dr. Cuevas surmised that because Plaintiff was on the local school board, “she elected to involve herself in activities which required future planning and commitments.” Campaigning for and working on the local school board, however, is not a forty-hour a week job. Before deciding to run for the local school board, Plaintiff learned that there would be three to four meetings a month and reading/studying at home. Her campaign consisted of sending by email a flyer made by a friend. Plaintiff thought that she could read and study while lying down at home and could physically handle one meeting a week. But sometimes she could not, and had to reschedule meetings. Other times, she would be in bed all day before a meeting, go to the meeting, and then come home and go right back to bed. After a year, Plaintiff resigned from the school board because she could no longer physically do the job. FN3
FN3.Defendants object to Plaintiff’s declaration, which contains this information regarding Plaintiff’s work on the local school board. They argue that the declaration is inadmissible because the Court’s review should be limited to a review of the administrative record. The Ninth Circuit instructs that a district court should exercise its discretion to consider information not in the administrative record “only when circumstances clearly establish that additional evidence is necessary to conduct an adequate de novo review of the benefit decision.” Mongeluzo v. Baxter Travenol Long Term Disability Ben. Plan,46 F.3d 938, 944 (9th Cir .1995). Here, it is necessary to consider Plaintiff’s declaration. Defendants never investigated Plaintiff’s work on the school board. Nor did they ask her about it. Instead, as Plaintiff notes, Defendants denied her appeal, based in part on a single line in Dr. Ho’s medical notes, and then closed her file. Plaintiff was never given an opportunity to explain and thus the record is devoid of any information regarding Plaintiff’s work on the school board. Defendants’ objection is overruled.
The Court does not find Drs. Kimelman, Siegel and Cuevas’ conclusions that Plaintiff is capable of working full-time persuasive; Dr. Ho’s conclusion that Plaintiff cannot work full-time, however, is persuasive, as are Dr. Lowe’s conclusion that Plaintiff would have a difficult time working and Dr. Kimelman’s conclusion that Plaintiff is believable. Defendants correctly note that the Supreme Court rejected the “treating physician rule,” which required that special deference be given to the opinion of a treating physician. See Black and Decker v. Nord,538 U.S. 822 (2003). However, the Ninth Circuit has held, following the Supreme Court’s decision in Nord: “On de novo review, a district court may, in conducting its independent evaluation of the evidence in the administrative record, take cognizance of the fact (if it is a fact in the particular case) that a given treating physician has a greater opportunity to know and observe the patient than a physician retained by the plan administrator.” Jebian v. Hewlett-Packard Co. Employee Benefits Org. Income Protection Plan,349 F.3d 1098, 1109 (9th Cir.2003)(quotations omitted). Plaintiff has been a patient of Dr. Ho for over twenty-years. The Court is not convinced that, because Plaintiff lives in Oregon and Dr. Ho practices in California and does not know what Plaintiff does every day, Dr. Ho’s assessment of Plaintiff should be discounted. Plaintiff provided to Hartford and Dr. Kimelman valid reasons for traveling to California to see Dr. Ho.
Plaintiff’s affliction and inability to work in any occupation is well-documented in Dr. Ho’s records and the administrative record. Approximately three month before Defendants terminated Plaintiff’s benefits, even Hartford agreed with Dr. Ho’s assessment. A September 12, 2003 note from Hartford’s Summary Detail Report states: “Med info supports that EE continues to remain TD any occ due to chronic fatigue syndrome. AP has indicated that on a good day, EE has cap. for physical act, and too much act. results in worsening of sx.” AR 46. And, a month after that note, Hartford employees concluded that, even with Dr. Kimelman’s report, there was not enough to terminate Plaintiff’s claim.
*13 As Plaintiff notes, there has been no significant change in her condition. She still has good days, when she can function, and bad days, when she cannot function. It is unpredictable whether Plaintiff will have a good day or a bad day, and, as Dr. Ho notes, the bad days can continue for up to two weeks. A full-time employer cannot handle such inconsistent attendance and unpredictability.
In reviewing all of the evidence in the administrative record, as well as Plaintiff’s declaration, the Court finds that Plaintiff is entitled to an award of benefits.Conclusion
For the foregoing reasons, the Court GRANTS Plaintiff’s motion for judgment by the Court (Docket No. 22) and DENIES Defendants’ cross-motion for judgment (Docket No. 26). Plaintiff shall recover her costs of action from Defendants. Judgment shall enter accordingly.It is so Ordered.
Copr. (C) West 2007 No Claim to Orig. U.S. Govt. Works N.D.Cal.,2006.
Thivierge v. Hartford Life and Acc. Ins. Co.
Not Reported in F.Supp.2d, 2006 WL 823751 (N.D.Cal.)
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