issue that's been presented is court as to whether the california van on discretionary clauses is preempted virus that has already been decided by this court in the morrison vs standard decision which to attempt to avoid morris and ross essentially that of the saving clause might apply if the if the ban applies to documents outside of  an insurance policy or has a collateral impact on some entity that's not an insurer have been put to rest in the fontayne case where the seventh circuit relying very heavily on this court's decision in morrison and of course the ross case has has decided those of those arguments are not not clearly valid and then being is most of that is has sort of already been decided in the really hadn't been any unless i get some direction from the court which i'm i'm happy to get on the focus this morning on the actual grounds for the district court decision and why i would leave the district court evident in re this final result the essentially with respect to the standard of review of this district court determined that there was a need for the plan to review be on the statute effective date of january first two thousand and twelve in order for it to be effective and that while the policy me of renewed beyond beyond that date the plan itself did not there's about three or pure statutory language the what the statute says is that the policy or contract or agreement if it's issued or  renewed whether in california or not to a california resident then any discretionary provision in the policy is barred but the problem with that with the with the statute is  it looks to me like i got a pretty good guess as to what california was trying to do here the question is whether the mechanism they chose was affective in in accomplishing that so how do you get there with this language because we do have this funny we do have this funny provision we've got the policy contract agreement but then when we get to the question of renewed it only said it only refers to a policy so you have a policy that renewed heat that is deemed by statute to have renewed on january first of each of each year but it's incorporated within the the master plan and and the master plan hasn't by operation of law or in fact renewed its it was good as of two thousand and eleven which is before the effective date of the act  mean i submit to the court and i appreciate the question i submit to the court that what the legislature did here which is to talk in broad terms in section and a about contracts agreements and policy but then in the renewable provision in section to limit itself to policies was exactly what was intended and the reason why i believe that what was intended is you know the discretionary provision it could be in a policy it could be in some other document a summary plan description or a contract or agreement the master we have to do we have at least two different discretionary phrases don't weigh but we have one that appears in a policy we have one appears in the master plan yeah and one that appears in the some summer pla descriptions what we actually have had ok three but the point is is that regardless as to where the the discretionary provision is there's always going to be a policy because this time only reach is disability insurance and life insurance and for an order to have disability insurance or life insurance you have to have a policy and so what the statute says is that when the policy renewed everything renewed and you can see that's that's sort of how it works if you take the definition of root of renewal which is you know renewal means the policy continues and forth beyond its anniversary date and insert that into section a and the language you get as a result is going to say if an agreement contract or policy continues in force beyond the policies anniversary date then it prohibits all law all discretion that's the plain language reading of the statute i think that's the intended language of the statute it makes sense because the legislature knew there was always going to be a policy and it wanted to have the broadest possible scope of this provision second point which is you know that the district judge recognised the argument was made in front of the district judge that well well wait a minute the you know the policy must be incorporated in the master plan so therefore the master plan must have renewed when the policy say doesn't give an exclusive for you know all encompassing definition of government governing documents and just give some examples certificates of insurance summary plan descriptions committee resolutions doesn't say that's all it just says these are examples of what could be governing documents the putting aside as we argue in our brief that a certificate of insurance is part of the insurance policy and serves the same purpose for an insurance think the burden of proof argument is critical but but but in fairness is mr albert points out this was not an issue that was presented to the district court below and i think fundamental fairness to everybody concerned should be that we go back to to the district court we get to raise the burden of proof argument which you know in a case like this given that no one's really certain the magnitude of my client's disabling condition she has a very very very many different problems that stem from very many different course of causes and isis submitted the burden of proof is a it is a critical issue and so i submit the appropriate thing to do is to the men to the district court for re trial under the correct standard of reviewing under the correct burden of proof if there are a well let me just  every district court it's looked at this statute has ruled and i myself have argued in in the snyder case that this statute is only effective if the policy renewed beyond january tw have news review it under the different center of review i mean you know this is a you know this is a risky case and so that's all you get anyway your honor is the court that the court knows i mean all we're going to get i just a review of the record with maybe the parties getting an opportunity to show up for rocky mountain and that's exactly right all we're really asking for is a review of the record under the correct standard of  just trying to understand why you think it's fair to send it back and since you tell me what if you go back not much is going to happen the parties are going to just sit there and wait for this record to roll basically what's fair about doing that and then having a of very much here's why your honor i think the burden of proof in this case he's fundamental i think that whoever given the evidence in the record which i've examined very closely it's my opinion that not has to bear the burden of proof which i think they should under the law that there's no way that they can successfully rule out all other potential causes of my client's various disabling symptoms and narrow it down to being primarily caused by psych i think that's an impossible burden to place and then all of that's the burden i think they should carry and so we're very confident frankly if this case goes back down to the district court and the proper burden of proof  applied that we're going to prevail we may not i get surprised all the time by by opinion sometimes are good surprises and sometimes not but the but this is a case where i feel that the burden of proof is going to be side me please the court and ronald alberts on behalf of the of pelleas we obviously take a very different position on all of the issues that have been just presented to you first of all we think what's happening here is a an impermissible attempt to expand the california insurers code beyond what it was intended for its own construction of that code we believe that in the event the court were to hold that in fact the insurance co to applies to a master welfare plan this is not a policy this is not insurance if it were to apply to a master welfare plan that it's going way beyond the scope california this is a national movement to undo the discretion that is given to plan administrator and california is not the only state that has that has undone that and so what would be unusual about california joining lots of other states and saying we no longer wish for insurers in california to exercise that kind of discretion oh nothing that's not that's not the point the point is not whether or not this insurance  provision can invalidate discretionary clauses in insurance policies what we're dealing with here is not an insurance policy what happened here and i think it's important to step back in and  at the bigger picture ok i mean in we can talk about the individual cases and why they kind of miss the point but what's happening here is that the boeing company created a master welfare plan a master benefit plan for all of its employees for a variety of products that they and benefits they give to their employees this is very distinguishable from a lot of the cases where you've got a single plan document that the insurance company has drafted and given to the employer and here present this where people have tried to get around these sorts of statutes here you have an employer that has decided on its own it wants to have including other courts of appeals have upheld these efforts by the legislature to take away that discretion that the plan administrator is half or plan creators whoever it is whether it's an insurance company or as i plan administrator or the company itself of not exactly no because this court has never ruled on this specific question i understand the distinction that you're trying they're trying to draw ok i'm skeptical of the times i'll have to tell you i'm going to tell you that right up front but i at least understand it so are you telling us  that that california doesn't have the power to do this or that they didn't accomplish it no i don't believe that the state legislature through the california insurance code has the power to tell an employer these are this is the way in which you must have benefits what you what what's important here is you've got three different insurance companies and a self funded plan all of which are governed by the master welfare plan this issue here and that's what the judge below understood at least that you're and the reason that california has does not have the power to do what the the what the appellant's think that it did is because it's preempted it's preempt as i read up yes arista would pretend the only thing that saved the only reason these statutes are being upheld is not because it doesn't interfere with the receipt you clearly interferes with the ricin the administration of benefits on a nationwide level of employee benefits ok the reason that there are a pair of the reason this court upheld this sort of provision in the for that was the montana  case was based on the fact that it was directed at insurance this is the way in which the player the appellant would have this court rule would focus the court on what would permit this statute to apply equally to a to the employer and that's not what it's about ok the reason that all of these have been upheld and every one of them that's been cited is not in the business of insurance ok so this is this statute the way in which the appellant is asking this court to apply it would actually be directing it at a non insurance entity and it would not be saved from preemption so it should be preempted essentially argue argument is if you know the line up this way first of all we think that the the insurance code does not apply to this if you look  california surance code provision it is you it's it talks only it talks over and over again refers back and forth and left and right to insurance policies there is kind of a reading of it that i it's all about policies and policy rules and policy renews each year when you look at a master welfare plan when you look at arista it doesn't matter as far as you're concerned is preempted even california repor it's when it's applied this way it is it's a preemptive i'm not arguing that the prior case law where this court has upheld the california insurance code as to discretionary suggesting then the then to that extent this insurance code would be preempted viruses because you can only you it is only saved from preemption if it's directed at insurance companies and statutes and it's not so so let's say we accept your argument where there's i guess you're ok so if it is preempted ok then then then we go back to the original plan documents which provide for an abuse of discretion standard there is it was a very very small amount of evidence what else was anything beyond that what about the conduct fatigue on the five of malaysia which doesn't seem to be taking into account of all conic fatigues and seems to have but the though those those those issues were i believe adequately dealt with by the revealing physicians that were involved and when and the the burden was on and would go to that it well and if i get that it should because it wasn't i can tell is not dealt with almost at all by you know certainly not given any weight by the by the plan this failure why isn't that an abuse of discretion and why isn't the existence of those i mean there's no dispute that she suffers from these things why isn't that take it say out of the what the cause psychological solution because it has to because her inability to function in her is the report from the physicians who are reviewing i'm asking you for the decision of where does f s a look it is not you know mental you know when do they say that do they say you know i don't have that document in front of me right now to read from it to you i'm sure it's part of the excerpts of record you know are denial letter and  page five of the opinion i don't have the actual record number that that's the that's just a recitation of what if what i received and that the letter acknowledged her chronic fatigue syndrome whether they in fact cause a lack of functionality right and this is true or you think i'm sorry but you have to weigh and compare them to the well i think you just record needs to review the underlying decision and make a determination as to whether they were adequately quick talk about what the way it was given to these two physical e spends a lot of time talking about mental impairment i would clearly that's because those are the elements which which the plaintiff or the claimant put forth as the rationale for her inability to function provisions outside of an insurance policy then it's not safe from preemption the but so therefore the insurance company if it wishes can just you know put the discretionary provision someplace outside of an insurance of government insurance the business of insurance bank you know those feels right but insurance is government here so and chloe was entitled just like everybody else to take advantage of the law as it is written of congress passed a very broad preemption statute but then passed an equally broad provision saving state insurance regulations and i think it was sort of an ironic comment of you know congress you know sometimes takes they made the line and employers look at the law they have lawyers tool and they say well you know the law says this you know this falls on this side of the line therefore that's why we're on what we're going to govern our conduct to stay within the preemption zone what's what's wrong with that well i mean no one's asking for for any she jiggling or jiggering of at all i mean the fact is that congress created expressly created reserved in the state broad power to regulate insurance and i submit that it was not congress's intended certainly isn't consistent with the language of the statute to say that you know we're going to give an insurance company and i knopper to need to sort future and the insurance contract it falls on the exception if it's outside the us that at least has the advantage of being easy living in a stable and predictable people don't have to keep coming to court and guessing what courts are going to do question the year your honor i'd rather win anyway i i can win obama although i have to tell you that i mean these discretionary provisions you know they come up in all the cases we kind of have a bright line rule already most of the time the you know defense counsel the excepted the fact that you know that you know the discretionary provision is no longer in play and we generally reach depletions is as to that and so you know this this decision has impact you  that you know you shouldn't just be able to write your way around you know otherwise on preempted the law that the regulates the conduct of insurance companies in this fashion and with respect to miller miller says that just because the insurance regulation has an incidental effect on non insurance entities doesn't mean that it still somehow escapes you know the scope of the savings cl so these issues of have all been have all been decided your honor if i just have just twenty seconds to talk about the court discussion with the with counsel about the actual medical condition your honor exactly right the hopefully we won't get to that your honor but but but my point was you know what you're asking us for the same questions i asked opposing counsel and then i'm going to push you tell me why you no longer whatever oh you know why i ask you why they absolutely punted on the pages twenty three twenty four twenty five the district court discusses all of that and and and rejects and we may or may not a agree with the just record if we were viewing to novo but if we're reviewing under some kind of a discretionary standard your honor dr moore testified not testified she stated in her report his great experience with the chronic fatigue syndrome said miss or or chesky has it and it's disabling now simply that what i believe the district court did is looking at the lack of neurological evidence and saying because there's no nor a logical cause for plaintiff symptoms that well i mean you know dr dr nee mark made a number of very i think very powerful pronouncements and that you know the notion that you can say that the plaintiff did not have chronic fatigue syndrome in five or my alethea was impossible because those diagnoses aren't aren't subject to to objective proof which is you know i think dispositive if you have dr moore who said she has these conditions and you know there's no test that can prove she doesn't have these conditions and as a matter of fact there's no expert employed by aetna who even actually ever looks at  to determine whether she has these conditions and whether these conditions are disabling rather all they do is look at the absence of a neurological injury from the record you're not disputing that your client may have some mental mental no there's no medical evidence that there is a connection between her mental illness and the c f s and fibromyalgia you know the plan requires that in order to fit within the exclusion yes essentially your honor the plan requires that the mental illness be the primary cause of the disability and in this case we have these two conditions which are probably independently disabling in spite of the psychological problems that  client almost certainly has to the so you know they just simply just know showing it to sort of allocating the burden i appreciate the time you're on a note and for the questions that i'll submit