Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_05-cv-03478/USCOURTS-cand-4_05-cv-03478-3/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

JOHN E. KING,

Plaintiff,

v.

GE FINANCIAL ASSURANCE COMPANY,

PHOENIX HOME LIFE MUTUAL COMPANY, THE

SONOMA NATIONAL BANK GROUP LONG TERM

DISABILITY PLAN, and SONOMA NATIONAL

BANK,

Defendants. /

No. C 05-3478 CW

ORDER ADDRESSING

CALCULATION OF

BENEFITS

On June 30, 2006, the Court denied Plaintiff John E. King's ex

parte application for an order to show cause why Defendants GE

Financial Assurance Company, Phoenix Home Life Mutual Insurance

Company, The Sonoma National Bank Group Long Term Disability Plan

and Sonoma National Bank should not be sanctioned for failure to

comply with the Court’s March 28, 2006 Order Granting Plaintiff’s

Motion for Judgment. See June 30, 2006 Order Denying Pl.'s App.

for an Order to Show Cause. Among other issues, the March 28, 2006

Order and accompanying judgment had required Defendants immediately

to restore Plaintiff's long-term disability benefits. The Court

denied Plaintiff's application for an order to show cause because

of Defendants’ agreement to pay at least a substantial portion of

the benefits owed. 

Case 4:05-cv-03478-CW Document 57 Filed 10/11/06 Page 1 of 4
United States District Court

For the Northern District of California

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The Court granted Defendants leave to file a surreply

addressing two issues raised in the Supplemental Declaration of

Julian M. Baum in Support of Plaintiff's Ex Parte Application for

Order to Show Cause, to which Defendants had not had an opportunity

to respond. These are: (1) whether Plaintiff’s Social Security

Disability benefits may be used to offset the long-term disability

benefits under the Plan; and (2) whether Plaintiff must provide

Defendants with documentation of his income, and if so the extent

of the required documentation. Defendants have since filed a

surreply. 

On the question of whether Plaintiff's Social Security

Disability benefits may offset Defendants' obligations to pay under

the Plan, Plaintiff relies on the following sentence in the plan: 

We will only consider as Other Income that amount which, when

added to your Gross Monthly Benefit, exceeds 100% of your

Basic Monthly Earnings. By Gross Monthly Benefit we mean the

amount of your Monthly Benefit prior to any reductions by

Other Income.

Milotte Decl., Ex. A, Group Long Term Disability Certificate (Plan)

13. As Defendants note, however, this sentence is contained within

the paragraph addressing "income received from any formal or

informal salary continuance plan." Id. Application of this

formula to the types of "Other Income" set forth in other

paragraphs (such as disability or social security benefits) would

be inconsistent with the "Calculation of The Monthly Benefit"

portion of the plan which does provide for the offsetting of "Other

Income,"

To determine the Monthly Benefit we will pay each month while

you are Disabled: 

Case 4:05-cv-03478-CW Document 57 Filed 10/11/06 Page 2 of 4
United States District Court

For the Northern District of California

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1. Multiply your Basic Monthly Earnings by the benefit

percentage as noted in the Monthly Benefit part of the

INSURANCE SCHEDULE;

2. Take the lesser of:

a) the resulting figure; or

b) the maximum Monthly Benefit as shown in the INSURANCE

SCHEDULE.

3. Carry forward the resulting figure in item 2 above and

subtract all Other Income benefits, as defined in the OTHER

INCOME part of the Certificate.

The Monthly Benefit will be payable subject to all the

terms of the policy, including, but not limited to, the

reductions for Other Income.

Id. at 12. Therefore, the Court concludes that Defendants'

decision to offset benefits by Plaintiff's Social Security

Disability income is not inconsistent with the Court's judgment. 

On the second issue, the Court finds that Defendants' demands

for documentation relate to their efforts to determine whether

Plaintiff is only partially disabled. The Court will not involve

itself in ongoing adjudication of the parties' responsibilities

relating to this effort. As the Court explained in its June 30,

2006 order, 

[I]f Defendants allege that Plaintiff is only partially

disabled and maintains a regular work schedule of less than

thirty hours a week, Defendants must make a new determination,

in accordance with the Plan and based on sufficient evidence,

that Plaintiff is no longer completely disabled. 

June 30, 2006 Order at 6-7 (citing March 28, 2006 Order at 4-5). 

Likewise, it is for Defendants to determine, subject to the terms

of the Plan and the applicable law, whether Plaintiff has 

Case 4:05-cv-03478-CW Document 57 Filed 10/11/06 Page 3 of 4
United States District Court

For the Northern District of California

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fulfilled his ongoing obligations to provide information under the

Plan. If he does not, Defendants may take any course of action

open to them consistent with the Plan and the law, and if Plaintiff

is aggrieved he may in turn pursue any remedies available to him

under the Plan and the law. 

IT IS SO ORDERED.

Dated: 10/11/06 

CLAUDIA WILKEN

United States District Judge

Case 4:05-cv-03478-CW Document 57 Filed 10/11/06 Page 4 of 4