Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_01-cv-00825/USCOURTS-azd-2_01-cv-00825-0/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1132 E.R.I.S.A.-Employee Benefits

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Nancy J. Pannebecker, 

Plaintiff, 

v.

Liberty Life Assurance Company of

Boston, a foreign corporation, 

Defendant. 

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CV-01-825-PHX-JAT

FINDINGS OF FACT 

AND CONCLUSIONS OF LAW

The case involves Plaintiff’s challenge of Defendant’s decision to deny her disability

benefits provided under a long-term disability plan ("Plan") that is subject to the Employee

Retirement Income Security Act of 1974, as amended (“ERISA”). Pending before the Court

is Plaintiff's Motion for Judgment under Rule 52(c) (Doc. # 108) and Defendant's Motion for

Summary Judgment Re: Report and Issues on Remand (Doc. # 105). 

In support of moving for judgment under Rule 52(c) of the Federal Rules of Civil

Procedure, Plaintiff cites Kearney v. Standard Ins. Co., 175 F.3d 1084 (9th Cir. 1999). In

Kearney, the Ninth Circuit reversed summary judgment and remanded the matter for

resolution of a genuine issue of fact. The Ninth Circuit instructed that a trial on the

administrative record would be the proper method to resolve the issue of fact, if the trial court

did not find it necessary under Mongeluzo v. Baxter Travenol Disability Benefit Plan, 46

Case 2:01-cv-00825-JAT Document 128 Filed 08/16/06 Page 1 of 17
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Also at oral argument, Defendant stated that it too should have moved for judgment

under Rule 52, instead of under Rule 56, because of the existence of a genuine issue of

material fact. On this basis, the Court will deny Defendant's Motion for Summary Judgment

Re: Report and Issues on Remand (Doc. # 105). 

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F.3d 938 (9th Cir. 1995), to consider additional evidence. Kearney, 175 F.3d at 1094-95.

According to the Ninth Circuit, the "record" consists not of testimony but of exhibits and

other documents which routinely serve as the basis for findings of fact. Id. 

In addition, during oral argument on the cross motions, both parties agreed that a

bench trial involving live testimony would not be necessary to resolve the issues before the

Court. Instead, the parties represented that the Court has before it, via the parties' filings, all

of the information necessary to render a decision in this case.1

 Accordingly, pursuant to

Kearney, the parties' representations during oral argument, and Rule 52 of the Federal Rules

of Civil Procedure, the Court has reviewed the administrative record and hereby finds and

concludes as follows: 

A. FINDINGS OF FACT

On January 27, 2004, the Court conducted a bench trial in this matter. On March 2,

2004, the Court issued Findings of Fact and Conclusions of Law (Doc. # 55). The Court

therein set forth its finding that Plaintiff was capable of performing sedentary work.

However, the Court concluded that "[a]lthough the administrative record presents ample

evidence in support of Defendant's conclusion that Plaintiff was able to perform some

unnamed 'sedentary' job, more is needed to evaluate Defendant's decision." Thereafter, the

Court stated:

The Plan provisions require that Plaintiff be “unable to perform

all of the material and substantial duties of [her] own or any

other occupation for which [she] is or becomes reasonably fitted

by training, education, experience, age, and physical and mental

capacity.” Defendant does not point to, and the Court did not

find, any evidence in the administrative record regarding

evidence of a specific “sedentary” position, if any, for which

Plaintiff is fitted by training, etc . . . . Because there is not (sic)

evidence regarding the fit between Plaintiff’s condition, her

training, etc . . ., and a specific sedentary job, the Court finds

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that Defendant failed to make a reasonable inquiry into the type

of skills Plaintiff possesses and whether those skills may be used

at another job. Accordingly, the Court finds that Defendant has

failed to properly apply the Plan provisions. In light of that

failure, the Court will remand this case to Defendant, as the Plan

Administrator, to make a determination as to the types of

sedentary positions, if any, for which Plaintiff is reasonably

fitted by training, education, experience, age, and physical and

mental capacity.

On remand, Defendant retained Jacqueline Kurth ("Ms. Kurth"), a certified

rehabilitation counselor, to perform a transferable work skills analysis and employment

assessment for Plaintiff. Ms. Kurth reviewed and summarized Plaintiff's education and work

history, as well as her medical history of coronary artery disease, in preparing her June 7,

2004 vocational evaluation report. 

In 1968, Plaintiff received a Bachelor of Arts Degree in Political Science from

Pennsylvania State University. From 1968 through 1973, Plaintiff worked for the National

Security Agency ("NSA") as a Programmer. At the NSA, Plaintiff supported design and

development of large-scale processing systems for the handling and analysis of data. From

1973 through 1978, Plaintiff worked for General Electric Company ("GE") as a Systems

Analyst in the Space Division. From 1978 through 1981, Plaintiff worked for Hughes

Aircraft Company ("Hughes") as a Technical Project Leader for the Space and

Communications Group, Information Systems Division. At Hughes, Plaintiff developed

software design specifications, designed and implemented graphics application software, and

supported all integration and test activities. From 1981 through 1982, Plaintiff worked for

International Business Machines ("IBM") as a Marketing Engineer with the Federal

Government Systems Division. At IBM, she was responsible for developing new business

in the area of analyzing customer database requirements, conducting comparative evaluations

of IBM-compatible products, and generating database design and software portions of

technical proposals for new business. From 1982 through 1988, Plaintiff worked for

Computer Corporation of America ("CCA") as Director of Database Consulting. At CCA,

Plaintiff directed technical consulting services for federal and commercial clients, and was

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responsible for the management of consulting projects as well as the development,

supervision and direction of the consulting staff. Finally, in 1988, Plaintiff returned to

Hughes as a Laboratory and Department Manager in Hughes' Information Technology

Department, Communications and Data Systems Division. Her job responsibilities included

supervising twenty to thirty technical professionals who focused on research and

development projects, business development, enhancement of technological base in the areas

of database, human machines interface, prototyping environments and tools, and software

and systems engineering techniques. Plaintiff also was involved in customer marketing,

leading specific business campaigns and proposal development in the management, technical

and costing areas. 

Based on Plaintiff's work experience, Ms. Kurth found:

[Plaintiff] has transferable work skills from her prior work

experience in the area of managing, coordinating, directing and

designing computer systems. She directed the work of systems

analysts, technical lab professionals, computer programmers,

support specialist and other computer-related workers. She was

involved in planning and coordinating activities such as

installation and upgrading of hardware and software,

programming and systems design, development of computer

networks, and implementation of internet and intranet sites. As

a computer and information system manager, she would analyze

the computer and information needs of clients. She determined

immediate and long-range personnel and equipment

requirements to meet operational needs.

[Plaintiff] has developed work skills from her prior work

experience that include the ability to coordinate activities of

others, analyze data, compute data, supervise personal (sic),

persuade others, present information in a clear and articulate

manner. The jobs she has performed require a high general

learning ability, verbal aptitude, numerical aptitude, spacial

aptitude, form perception, motor coordination, and clerical

perception.

 Ms. Kurth then concluded:

Given [Plaintiff's] education background, work history and

current physical capabilities, she should be able to perform a

variety of sedentary occupations. Jobs such as customer service

representative, information clerk, receptionist, data entry keyer,

and general office clerk would be within her transferable work

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skills. 

* * *

Based on review of medical records and documents, it is my

opinion that [Plaintiff] is currently capable of working on a full

time basis in a sedentary occupation.

There are numerous sedentary occupations which [Plaintiff] is

qualified to perform based on her educational background,

transferable work skills and physical capabilities. The

occupations/jobs have been identified as well as the rates of pay

for these jobs that exist in the open labor market.

On June 9, 2004, Defendant filed a Report Upon Remand (Doc. # 77), attaching

thereto a copy of Ms. Kurth's report and requesting judgment in its favor based on Ms.

Kurth's identification of sedentary occupations for which Plaintiff is reasonably fitted by

training, education, experience, age and physical and mental capacity. By Order dated

December 3, 2004 (Doc. # 87), the Court remanded the case to the Plan Administrator to

provide Plaintiff the opportunity to administratively appeal Defendant's Report Upon

Remand.

During the administrative appeal period, Plaintiff retained Lisa Clapp ("Ms. Clapp"),

a vocational consultant, to assess and evaluate Plaintiff's employability. According to Ms.

Clapp's February 14, 2005, report: 

On January 25, 2005 a vocational interview was performed with

[Plaintiff] by [Ms. Clapp]. Subsequent to records review and

analysis and the initial vocational interview with [Plaintiff],

labor market research was performed with a multitude of

employers for the vocational directives of office clerk, dataentry operator, information clerk, customer service

representative and administrative assistant/office worker as well

as receptionist. The purpose of the labor market research was to

profile [Plaintiff] giving consideration to her past work

experience, educational background, age and medical

restrictions. 

Ms. Clapp found that the labor market research indicated the jobs surveyed involved

a stressful work environment, which is "contra-indicated" for Plaintiff. Further, Ms. Clapp

stated:

Review of [Plaintiff's] résumé is impressive on paper, however,

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it is noted that she last worked in September of 1996 and her

pertinent work experience was with Federal Government

contract projects. Therefore, her practical work experience is

distant, outdated and really not applicable in the private

employment sector.

* * *

In short, [Plaintiff] has 27 years of diverse experience involving

technical, managerial and marketing roles related to the design

and development of large-scale systems in the federal

government sector. Although she at one time had extensive

knowledge of system analysis and design techniques, database

management technology, and organizational planning and

management, all of this experience took place in the public

sector of the federal government. Therefore, [Plaintiff's] skills

would not be deemed as suitable and significant in the private

sector.

 Ms. Clapp also criticized the report prepared by Ms. Kurth, stating:

In short, it would appear as though Ms. Kurth's research

performed was simply gathering information about positions,

which she felt were suitable for [Plaintiff]. The appropriate way

to perform labor market research is to create a profile of an

individual, which gives consideration to their educational

background, age, work history, current skills and recent

employment experience as well as their medical restrictions.

Once the profile is completed, it is presented to employers via

telephone research to inquire as to their consideration suitability

(sic) for the positions. It does not appear Ms. Kurth performed

this activity and therefore she has instead relied upon her past

experience versus inquiring as to what these employers are

actually looking for in a competitive and qualified applicant

currently. 

Thereafter, Ms. Clapp concluded:

Based upon the results of actual labor market research where

[Plaintiff] was profiled to employers, it is this consultant's

opinion that [Plaintiff] has been and remains totally disabled

from substantial gainful employment based upon the criteria set

forth in Liberty Life Assurance Company's definition of

disability. Specifically, [Plaintiff] is not reasonably fitted by

training, education, experience, age, and physical and mental

capacities for these positions.

After receipt of Ms. Clapp's employability assessment report, Defendant requested

that Ms. Kurth review the report, as well as the letter of appeal from Plaintiff's counsel, to

determine whether or not the information contained therein changed her opinion regarding

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suitable employment for Plaintiff. In a report dated April 17, 2005, Ms. Kurth stated: 

The Employability Assessment submitted by Ms. Clapp uses an

approach to evaluate employability that is typically used in

workers' compensation system. Each system, workers'

compensation, long term disability, social security, etc. utilizes

an approach that is specific to that system. In this case, the

consultant did not use an approach to evaluate [Plaintiff's]

employability that is specific to the long term disability policy.

* * *

The Employability Assessment completed by Ms. Clapp dated

February 14, 2005 approaches the evaluation of [Plaintiff's]

employability as typical in a workers compensation or industrial

injury claim. In my report dated [June 7, 2004] I conclude that

based on [Plaintiff's] education, and prior work experience, she

has transferable work skills in the area of managing,

coordinating, directing, and designing computer systems. She

also has abstract reasoning and technical skills as well as the

ability to communicate. Because of the work that she was

involved in, she would have to plan and coordinate activities and

implement plans of action. There is nothing in the medical

records that reflect or indicate [Plaintiff] has lost the ability to

use her intelligence or aptitude for doing activities such as

simple problem solving, analyzing information, learning new

information and communicating through written and verbal

language.

In addition, Ms. Kurth stated:

In my report, I identified jobs that are considered entry level and

typically associated with less stress. As [Plaintiff] has said that

she is not able to handle the stress of her former occupation

(meeting deadlines and managing people) I used her transferable

work skills to identify occupations such as Customer Service

Representative (not telephone solicitor or sales), Information

Clerk and Receptionist and General Office Clerk. It is my

opinion that the job of Customer Service Representative, such

as Computer Support or Help Desk, Information Clerk and

Receptionist and General Office Clerk are positions that are

within [Plaintiff's] transferable work skills and the physical

capabilities as outlined in the Functional Capacity Form dated

June 13, 2000. 

Based on the foregoing, Ms. Kurth concluded "it continues to be my opinion that if

[Plaintiff] were motivated to return to work, there are numerous sedentary occupations she

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Ms. Kurth noted that the identified occupations "were being performed in the open

labor market in the Phoenix metropolitan area in the year 2000." 

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would be able to perform based on her physical and mental capacity."2 

In correspondence dated May 3, 2005, Defendant declined to alter its determination

to deny benefits, stating:

Based upon our thorough review of [Plaintiff's] claim, we have

determined that she has sedentary work capacity. Extensive

vocational review conducted by Ms. Kurth establishes that there

are sedentary occupations that [Plaintiff] has the functional

capacity and vocational skills to perform. As such, the denial of

LTD benefits must be maintained.

After Defendant declined to alter its determination, Plaintiff filed a motion to appeal

the decision on remand (Doc. # 91). During a subsequent Rule 16 scheduling conference,

the Court set discovery and dispositive motion deadlines. Thereafter, the Court determined

that the de novo standard of review would apply to the issues being appealed on remand

(Doc. # 96).

 B. CONCLUSIONS OF LAW AND RESULT

In McKenzie v. General Telephone Company of California, 41 F.3d 1310, 1313 (9th

Cir. 1994), the language of the disability plan provided:

[A]fter the first 18 months you will be considered totally

disabled only if you are completely unable to engage in any and

every duty pertaining to any occupation or employment for

wage or profit for which you are or become reasonably qualified

by training, education or experience.

Interpreting this "any occupation" language, the McKenzie court stated:

[T]he language of the 'any occupation' standard is not

demanding. In order for Travelers to find that McKenzie is not

totally disabled, it requires only that McKenzie be able to

perform a job for which he is qualified or for which he can

reasonably become qualified by training, education or

experience.

 McKenzie, 41 F.3d at 1317; see also Graeber v. The Hewlett Packard Company Employee

Benefits Organization Income Protection, 421 F.Supp.2d 1246, 1253 (N.D.Cal. 2006) (citing

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Plaintiff argues that Defendant improperly imposes upon her additional training

obligations by including under the definition of disabled those occupations for which

Plaintiff is, becomes, or could become fitted. In light of the interpretation of similar language

in McKenzie, this argument is without merit. 

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McKenzie and stating that plaintiff was not totally disabled under the "any occupation"

standard "if he was able to perform a job for which he was qualified or for which he

reasonably could become qualified by training, education or experience."); Brigham v. Sun

Life of Canada, 317 F.3d 72, 86 (1st Cir. 2003) (finding paraplegic not totally disabled and

noting that "the hurdle plaintiff had to surmount, establishing his inability to perform any

occupation for which he could be trained, was a high one."). 

Like the "any occupation" standard in McKenzie, the Plan partially defines "any

occupation" as those "for which [Plaintiff] is or becomes reasonably fitted." Considering the

interpretation given to the similar language in McKenzie, the Court concludes that the Plan's

"any occupation" standard is "not demanding." Id. And, the Court concludes that to find

Plaintiff not totally disabled under the Plan requires only that Plaintiff be able to perform a

job "for which she is or for which she can reasonably become" fitted by training, education,

experience, age, and physical and mental capacity. Id.

3

 

As concluded in the Court's March 2, 2004, Findings of Fact and Conclusions of Law

(Doc. # 55), "the administrative record presents ample evidence in support of Defendant's

conclusion that Plaintiff was able to perform some unnamed 'sedentary' job." However, the

Court remanded the matter to Defendant "to make a determination as to the types of

sedentary positions, if any, for which Plaintiff is reasonably fitted by training, education,

experience, age, and physical and mental capacity." The Court has thoroughly reviewed the

administrative record and finds that Defendant has identified sedentary positions for which

Plaintiff is or can reasonably become fitted by training, education, experience, age, and

physical and mental capacity. While Plaintiff has submitted contrary evidence, the Court,

as discussed below, does not find the evidence sufficient to support a finding under the Plan

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The Court finds Saffle v. Sierra Pacific Power Co. Bargaining Unit Long Term

Disability Income Plan, 85 F.3d 455 (9th Cir. 1996), cited by Plaintiff for the proposition that

unconsciousness is not the criteria for a disability determination, to be inapposite. The Saffle

court was concerned with the proper interpretation of the phrase "each and every duty of his

regular occupation," not with the interpretation of a claimant's "training, education,

experience, age, and mental and physical capacity" under an "any occupation" standard.

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that Plaintiff is disabled. Accordingly, the Court finds that Plaintiff is not disabled under the

terms of the Plan.

Plaintiff asserts numerous arguments in support of her contention that she is disabled

under the terms of the Plan. The Court, in reviewing the administrative record and reaching

its decision, has fully considered Plaintiff's arguments and will address them in turn.

First, Plaintiff argues that Defendant identified jobs without considering Plaintiff's

training, education, experience, age, and mental and physical capacity.4

 The Court disagrees.

Upon remand, Defendant retained Ms. Kurth to perform a transferable skills analysis and

employment assessment for Plaintiff. Ms. Kurth reviewed Plaintiff's education, work history,

and medical history. Thereafter, Ms. Kurth identified numerous sedentary occupations that

Plaintiff could perform given her education, work history and physical capabilities. Ms.

Kurth also noted that the occupations identified are typically associated with less stress. The

Defendant reviewed this information, along with the other information contained in Plaintiff's

claim file, and determined that a reversal of its denial of benefits was not warranted. As for

consideration of Plaintiff's age, there is nothing in the administrative record to indicate that

Plaintiff's age (59 years old) is an obstacle to performing any of the sedentary occupations

identified by Ms. Kurth. See Duhon v. Texaco, Inc., 15 F.3d 1302, 1308 (5th Cir. 1994)

("people in their sixties and seventies . . . are employed and employable throughout the

workplace today.").

Second, Plaintiff argues that Ms. Clapp performed a proper evaluation of Plaintiff's

employability and that it shows Plaintiff is not fitted for any of the sedentary occupations

identified by Ms. Kurth. The Court disagrees. Ms. Clapp, in performing her evaluation,

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The Court notes that the Plan does not require that Plaintiff be capable of performing

"substantial gainful employment" before Defendant may conclude that Plaintiff is not

disabled. This standard is one used by the Social Security Administration to determine

disability. See Reddick v. Charter, 157 F.3d 715, 721 (9th Cir. 1998). Further, the Court

finds that Plaintiff's argument that Defendant cannot reject Plaintiff's social security award

without explanation lacks merit because the Court already has concluded that "the

administrative record presents ample evidence . . . that Plaintiff was able to perform some

unnamed 'sedentary' job" and the Plan determines benefits under a different standard. See

Madden v. ITT Long Term Disability Plan for Salaried Employees, 914 F.2d 1279, 1285-86

(9th Cir. 1990). 

6

Alternatively, the Court would sustain Defendant's hearsay objection concerning Ms.

Clapp's report and what Ms. Clapp allegedly told third parties and what third parties

allegedly told her. The Court notes that Plaintiff, at the hearing on the cross motions for

judgment, agreed that a bench trial, at which live testimony could be presented and the

hearsay problem potentially cured, was not necessary. 

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conducted labor market research for Plaintiff. The research involved profiling plaintiff,

giving consideration to her experience, education, age, and medical condition. Thereafter,

Ms. Clapp surveyed various employers, who advertised jobs under the occupational

categories identified by Ms. Kurth, to determine whether or not the employers would

consider Plaintiff a suitable and competitive candidate. Ms. Clapp found, based on the

results of the labor market research, that Plaintiff does not possess suitable skills and would

not be considered a competitive and qualified applicant; therefore, Ms. Clapp concluded that

Plaintiff is totally disabled from "substantial gainful employment" under the Plan.5

The Court finds that the methodology utilized in Ms. Clapp's evaluation does not

support her ultimate conclusion. More specifically, simply because Plaintiff may be unable

to perform the duties of the specific jobs surveyed under the broad occupational categories

Ms. Kurth identified does not necessarily equate to a finding that Plaintiff is unable to

perform any job under the occupational categories. Accordingly, the Court finds that Ms.

Clapp's report does not refute Ms. Kurth's findings.6

In addition, Ms. Clapp's report clearly implies that Defendant is required to locate or

identify a specific job for Plaintiff, one for which she will be hired, prior to making a

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determination that Plaintiff is not disabled. In as much as the Plan does not require that

Defendant ensure Plaintiff the availability of an alternative job prior to terminating benefits,

the Court cannot impose such requirement. See Block v. Pitney Bowes Inc, 705 F.Supp. 20,

24 (D.D.C. 1989), aff'd, 952 F.2d 1450 (D.C. Cir. 1992) ("When a plan does not specifically

state that the employer has the duty of ensuring the availability of an alternative job, the court

cannot impose such a requirement."); see also Duhon v. Texaco, Inc., 15 F.3d 1302, 1309

(5th Cir. 1994) (finding "it was not necessary under this plan that the administrator 'insure

the availability of an alternative job' for Duhon before terminating his benefits."). Further,

"disability" under the plan is not defined in terms of Plaintiff being unable to locate a specific

job; instead, it is defined more generally in terms of Plaintiff being unable to perform the

duties of "any occupation." See Couzens v. Equitable Life Assurance Society of the United

States, 1998 WL 695425, * 4 (E.D.Pa. 1998) (Under the plan, "[t]otal disability does not

mean that Plaintiff cannot find a job, but rather that Plaintiff is unable to perform any gainful

occupation.").

Third, Plaintiff argues that Defendant improperly delegated discretion to its counsel

and Ms. Kurth. Specifically, Plaintiff claims that Ms. Kurth forwarded her report to

Defendant's counsel who then submitted it directly to the Court without any analysis on the

part of Defendant. See McKenzie, 41 F.3d at 1316 (Evidence submitted directly to the

district court, without first being reviewed by the plan administrator, was improperly

considered because it was not in the administrative record.). Defendant may not have

reviewed Ms. Kurth's report before the Report Upon Remand (Doc. # 77) was filed.

However, Defendant clearly considered the report after the Court remanded the matter so

Plaintiff could administratively appeal the Report Upon Remand, as evidenced by the

Defendant's May 3, 2005 correspondence to Plaintiff's counsel declining to alter its

determination. Thus, Plaintiff's argument is without merit.

Fourth, Plaintiff argues that Defendant did not follow its own policy definitions and

internal guidelines regarding the consideration of earnings when it determined that Plaintiff

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Plaintiff also argues that Madden v. ITT Long Term Disability Plan for Salaried

Employees, 914 F.2d 1279 (9th Cir. 1990), requires that an occupation under the "any

occupation" standard must approach pre-disability earnings to preclude disability benefits.

Madden only provides that a plan definition of disabled, which recognizes a claimant's

training, education or experience, favors a claimant far more than an emphasis on

remuneration. The Court already has found that Defendant, as required by the Plan,

considered Plaintiff's training, education, and experience, as well as her age, and mental and

physical capacity, in determining that she is capable of performing the identified sedentary

occupations. The Court finds this sufficient to satisfy Madden. Further, Plaintiff's reliance

on non-Ninth Circuit case law in arguing that "reasonably fitted by training, education, and

experience" requires the existence of a job which is comparable in terms of remuneration is

unpersuasive in light of Madden and McKenzie, 41 F.3d 1310. 

8

Plaintiff erroneously states that Defendant, in response to discovery, admitted the

relevance of the PP&Es to Plaintiff's claim and that the PP&Es were applied in this case. To

the contrary, Defendant's discovery response states that the PP&Es "are not 'how to' guides

and they are not used all the time . . . there is no record or way to identify whether any of

these [PP&Es] were in any way reviewed or utilized in the handling of Plaintiff's claim." 

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is not disabled. The Court already has concluded that the definition of disabled in the Plan

does not contain comparable salary language, thus precluding a comparable salary analysis.

See Findings of Fact and Conclusions of Law (Doc. #55).7

 Further, the Court notes that Ann

Berry, a Disability Appeals Consultant for Defendant, testified that the internal guidelines,

known as Policies, Procedures and Exceptions ("PP&Es"), which contain references to salary

comparisons that may be used to determine disability status, are not hard and fast rules and

are not required to be applied in every case.8

 Finally, the Rehabilitative Employment Benefit

which contains a salary component cannot reasonably be read to modify the definition of

disabled and, furthermore, Plaintiff has made no showing that she has attempted to avail

herself of such a benefit.

 Fifth, Plaintiff argues that Defendant deprived her of a fair review by allowing Ms.

Kurth to prepare a second report, after Plaintiff administratively appealed, to which Plaintiff

has not had an opportunity to respond. Plaintiff claims that this is in violation of 29 C.F.R.

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9

This provision is now contained in 29 C.F.R. § 2560.503-1(g).

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§ 2560.503-1(f) (requiring notice of the specific reason or reasons for the denial of benefits).9

The Court disagrees. Ms. Kurth's second report was prepared in response to Ms. Clapp's

report prepared on behalf of Plaintiff. The second report merely re-affirmed Ms. Kurth's

earlier findings and addressed the methodology utilized by Ms. Clapp. The Court finds that

the second report does not contain any information concerning Plaintiff's ability to perform

the duties of "any occupation" that was not contained in Ms. Kurth's first report. Further, the

Court considers this argument waived in light of Plaintiff's representation at oral argument

that the Court has before it, via the parties' filings, all of the information necessary to render

a decision. Because the Court previously determined that the de novo standard of review

would apply to the issues being appealed on remand, had Plaintiff truly believed she was

improperly denied the opportunity to respond to Ms. Kurth's second report, she could have

sought to introduce additional evidence, not in the record, under Mongeluzo v. Baxter

Travenol Disability Benefit Plan, 46 F.3d 938 (9th Cir. 1995).

Sixth, Plaintiff argues that Defendant failed to inform her, before she filed her appeal

after remand, of the information it required to properly consider any appeal. The Defendant

is required, under 29 C.F.R. § 2560.503-1(f), now subpart (g), to describe "any additional

material or information necessary for the claimant to perfect the claim and an explanation of

why such material or information is necessary." However, even if Defendant failed to

explicitly describe "any additional material or information," Defendant's decision will not be

invalidated if there was substantial compliance with the regulation. Chuck v. Hewlett

Packard Co., — F.3d —, 2006 WL 2052288, *4 (9th Cir. 2006) (incorrectly citing as a Ninth

Circuit decision Brogan v. Holland, 105 F.3d 158 (4th Cir. 1997)). "To substantially comply

with the regulation, the Trustees must have supplied the beneficiary 'with a statement of

reasons that, under the circumstances of the case, permitted a sufficiently clear understanding

of the administrator's position to permit effective review.'" Brogan, 105 F.3d at 165

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(citations omitted). Further, the Ninth Circuit has explained:

In simple English, what this regulation calls for is a meaningful

dialogue between ERISA plan administrators and their

beneficiaries. If benefits are denied in whole or in part, the

reason for the denial must be stated in reasonably clear

language, with specific reference to the plan provisions that

form the basis for the denial; if the plan administrators believe

that more information is needed to make a reasoned decision,

they must ask for it. 

Booten v. Lockheed Medical Benefit Plan, 110 F.3d 1461, 1463 (9th Cir. 1997); see also

Bojorquez v. E.F. Johnson Co., 315 F.Supp.2d 1368, 1373 (S.D. Fla. 2004) ("an insurance

company does not have to tell a claimant what information he will need to provide in order

to 'win' his appeal; rather, substantial compliance exists where the claimant understands what

additional materials to provide in order for the appeals process to prove effective.") 

In this case, the Court already has reviewed the Defendant's October 2, 2000 and

January 11, 2001 correspondence to Plaintiff that clearly outlined the reasons for Defendant's

decision to deny benefits. See Findings of Fact and Conclusions of Law (Doc. # 55), pp. 6

and 7. After remand, and pursuant to the Court's instructions, Defendant submitted Ms.

Kurth's vocational evaluation report, which further supported Defendant's decision to deny

Plaintiff benefits. The Court finds this sufficient to show that Defendant engaged in

meaningful dialogue with Plaintiff concerning the disability determination and that the

statement of reasons "permitted a sufficiently clear understanding of [Defendant's] position

to permit effective review." Brogan, 105 F.3d at 165. Thus, Defendant did not violate 29

C.F.R. § 2560.503-1(f), now subpart (g). 

Finally, Plaintiff argues that if the Report Upon Remand (Doc. # 77) is a new

decision, then Plaintiff's benefits should have been paid until the date of the report.

Alternatively, Plaintiff argues that the evidence in the report did not exist at the time of the

Defendant's original decision in 2000; thus, the evidence cannot support the original decision.

In support of the latter argument, Plaintiff cites Matuszak v. Torrington Company, 927 F.2d

320, 322-23 (7th Cir. 1991), which states that "no plan can provide discretion to deny

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10According to the court in Quinn, "[c]ases that call for reinstatement usually either

involve claimants who were receiving disability benefits, and, but for their employers'

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benefits for reasons identified only years after the fact." 

The Court finds Matuszak to be inapposite. Specifically, in Matuszak, the defendants

originally denied benefits because the plaintiffs had not been actively working on the date

of the plant closure announcement. During litigation before the District Court, the

defendants changed the reason for the denial of benefits and asserted that the plaintiffs were

denied benefits because they did not possess sufficient seniority. In contrast, Defendant

herein originally denied benefits on the ground that Plaintiff is not disabled under the "any

occupation" standard and, after remand, denied benefits on the same ground. Even if the

Court found Matuszak to be on point, the only remedy provided for the defendants' action

was a de novo review of the decision to deny benefits. As discussed, the Court already

determined that the de novo standard of review would apply to the issues being appealed on

remand. 

Further, Plaintiff is not entitled to a retroactive award of benefits because the Report

Upon Remand is not a new decision. As discussed, the Court previously found "ample

evidence in support of Defendant's conclusion that Plaintiff was able to perform some

unnamed 'sedentary' job." However, the Court remanded the matter to the Defendant because

"it failed to make a reasonable inquiry into the type of skills Plaintiff possesses and whether

those skills may be used at another job." As the court in Quinn v. Blue Cross and Blue Shield

Association, 161 F.3d 472, 477 (7th Cir. 1998), stated:

[W]hen a court or agency fails to make adequate findings or

fails to provide an adequate reasoning, the proper remedy in an

ERISA case, as well as a conventional case, is to remand for

further findings or explanations, unless it is 'so clear cut that it

would be unreasonable for the plan administrator to deny the

application for benefits on any ground.' 

(Citations omitted). In such a situation, a retroactive award of benefits is not appropriate.

Id.

10 Thus, because the Court previously remanded the matter to Defendant for further

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arbitrary and capricious conduct, would have continued to receive the benefits, or they

involve situations where there is no evidence in the record to support a termination or denial

of benefits." Quinn, 161 F.3d at 477 (citations omitted). 

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findings, Plaintiff is not entitled to a retroactive award of benefits. 

Accordingly,

IT IS ORDERED that Plaintiff's Motion for Judgment under Rule 52(c) (Doc. # 108)

is granted to the extent it requests relief pursuant to Rule 52 of the Federal Rules of Civil

Procedure and denied in all other respects;

IT IS FURTHER ORDERED that Defendant's Motion for Summary Judgment Re:

Report and Issues on Remand (Doc. # 105) is denied; and

IT IS FURTHER ORDERED that, on the submission of the record pursuant to

Kearney v. Standard Ins. Co., 175 F.3d 1084 (9th Cir. 1999), the parties' representations

during oral argument, and Rule 52 of the Federal Rules of Civil Procedure, the Clerk of

Court is directed to enter judgment in favor of Defendant and against Plaintiff, in accordance

with the reasons set forth herein. Plaintiff is to take nothing.

DATED this 16th day of August, 2006.

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