The opinion of the court was delivered by: Honorable Avern Cohn
DENYING PLAINTIFF'S MOTION FOR ENTRY OF JUDGMENT (Doc. No. 9) AND GRANTING DEFENDANT'S MOTION FOR ENTRY OF JUDGMENT (Doc. No. 11) AND DISMISSING CASE
This is a benefits case under the Employment Retirement Income Security Act, 29 U.S.C. § 1001, et seq (ERISA). Plaintiff Joseph Maleszewski (Maleszewski) is suing defendant Liberty Life Assurance Company of Boston (Liberty Life). He claims that Liberty Life wrongfully denied his claim for long term disability (LTD) benefits under a group insurance policy (plan) held by his former employer, Comcast Corporation (Comcast) and issued and administered by Liberty Life. As will be explained, Liberty Life initially found Maleszewski was entitled to short term disability benefits and 12 months of LTD benefits. However, Liberty Life determined that after the 12 months, he was no longer disabled under the plan and therefore terminated his LTD benefits. Maleszewski says this decision was arbitrary and capricious.
The matter is before the Court on the parties' cross motions for entry of judgment. For the reasons that follow, Maleszewski's motion will be denied, Liberty Life's motion will be granted, and the case will be dismissed.
II. Legal Standard - Motion for Entry of Judgment
In Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609 (6th Cir.1998), the Court of Appeals for the Sixth Circuit held that summary judgment procedures may no longer be used in the Sixth Circuit in denial of benefits actions under ERISA. In Wilkins, the court of appeals decided a district court should adjudicate an ERISA action as if it were conducting a standard bench trial and, therefore, determining whether there is a genuine issue of fact for trial would make little sense. 150 F.3d at 618-19 (Gilman, J., concurring in part and setting out the judgment of the court of appeals on the issue regarding the summary judgment standard).
Accordingly, the Court will decide this matter under the guidelines set forth in Wilkins*fn1 by rendering findings of fact and conclusions of law based solely upon the administrative record. See Eriksen v. Metropolitan Life Ins. Co., 39 F. Supp. 2d 864 (E.D. Mich. 1999).
The parties agree that the standard of review in this case is whether the denial of benefits was arbitrary and capricious because Liberty Life had discretionary authority to construe and interpret the plan. See Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Miller v. Metropolitan Life Ins. Co., 925 F.2d 979, 983 (6th Cir. 1991). This standard is the "least demanding form of judicial review." Administrative Committee of the Sea Ray Employees Stock Ownership and Profit Sharing Plan v. Robinson, 164 F.3d 981, 989 (6th Cir. 1999). This requires "review of the quality and quantity of the medical evidence and the opinions on both sides of the issues." McDonald v. W.-S. Life Ins. Co., 347 F.3d 161, 172 (6th Cir.2003). The plan administrator's decision should be upheld if it is "the result of a deliberate, principled reasoning process" and "supported by substantial evidence." Glenn v. MetLife, 461 F.3d 660, 666 (6th Cir. 2006), aff'd, Met. Life Ins. Co. v. Glenn, --- U.S. ----, 128 S.Ct. 2343 (2008). The standard, although deferential, is not "inconsequential." Moon v. Unum Provident Corp., 405 F.3d 373, 379 (6th Cir. 2005). "While a benefits plan may vest discretion in the plan administrator, the federal courts do not sit in review of the administrator's decisions only for the purpose of rubber stamping those decisions." Id.
Moreover, the Sixth Circuit has made clear that a court is to consider several factors in reviewing a plan administrator's decision, including the existence of a conflict of interest, the plan administrator's consideration of the Social Security Administration determination, and the quality and quantity of medical evidence and opinions. Glenn, 461 F.3d at 666.
Here, a conflict of interest exists because Liberty Life was both responsible for reviewing and paying benefits. The Supreme Court has held that a conflict of interest exists for ERISA purposes where the plan administrator evaluates and pays benefits claims, even when, as here, the administrator is an insurance company and not the beneficiary's employer. Glenn, 128 S.Ct. at 248-50. We give more weight to the conflict "where circumstances suggest a higher likelihood that it affected the benefits decision...." Id. at 2351. A conflict may affect a benefits decision in several ways. For example, although the treating physician rule does not apply in ERISA cases, the Supreme Court has acknowledged that "physicians repeatedly retained by benefits plans may have an incentive to make a finding of 'not disabled' in order to save their employers money and preserve their own consulting arrangements." Black & Decker Disability Plan v. Nord, 538 U.S. 822, 832, (2003). The Sixth Circuit has observed that when a plan administrator both decides claims and pays benefits, it has a "clear incentive" to contract with consultants who are "inclined to find" that a claimant is not entitled to benefits. Kalish v. Liberty Mutual/Liberty Life Assurance, 419 F.3d 501, 507 (6th Cir. 2005). The Court will consider Liberty Life's conflict as a factor in evaluating its decision to deny Maleszewski benefits.
The following facts are gleaned from the administrative record.
1. Definition of Disability
The plan defines disability as follows: "Disability" or "Disabled," with respect to Long Term Disability means:
I. if the Covered Person is eligible for the 12 Month Own Occupation benefits, Disability or Disabled means that during the Elimination Period and the next 12 months of Disability the Covered Person, as a result of Injury or Sickness, is unable to perform the Material and Substantial Duties of his Own Occupation; and
ii. thereafter, the Covered Person is unable to perform, with reasonable continuity, the Material and Substantial Duties of Any Occupation.
"Any Occupation" with respect to Classes 4 and 5, means any gainful occupation that the Covered Person is or becomes reasonably fitted by training, education, experience, age, physical and mental capacity. Gainful occupation means an occupation in which the earnings are: -equal to or greater than 80% of the Employee's pre-disability income; -less than 80% of the Employee's average pre-disability income, but higher than the average ...