Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_04-cv-00413/USCOURTS-cand-4_04-cv-00413-0/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 28:1441 Petition for Removal

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United States District Court

For the Northern District of California

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1 Except where otherwise noted, the following facts are

undisputed and are taken from Plaintiff’s administrative claim

file.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MICHAEL HIRSH,

Plaintiff,

v.

LIFE INSURANCE COMPANY OF NORTH

AMERICA; ROSS STORES, INC. LONG

TERM DISABILITY PLAN; and DOES 1

through 30, et al.;

Defendants.

 /

No. C 04-0413 CW

ORDER DENYING

PLAINTIFF’S

MOTION FOR

SUMMARY JUDGMENT

AND GRANTING

DEFENDANTS’

MOTION FOR

JUDGMENT UNDER

RULE 52

Plaintiff Michael Hirsh moves, pursuant to Federal Rule of

Civil Procedure 56, for summary judgment that he is entitled to

long term disability benefits under Defendant Ross Stores, Inc.

Long Term Disability Plan, which is administered by Defendant

Life Insurance Company of North America (LINA). Defendants

oppose the motion and move for judgment under Federal Rule of

Civil Procedure 52. The matter was heard on June 10, 2005. 

Having considered the parties’ papers, the evidence cited

therein and oral argument on the motions, the Court DENIES

Plaintiff’s motion for summary judgment and GRANTS Defendants’

motion for judgment under Rule 52. 

BACKGROUND1

Case 4:04-cv-00413-CW Document 45 Filed 06/21/05 Page 1 of 10
United States District Court

For the Northern District of California

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Plaintiff was hired as a senior systems analyst by Ross

Stores, Inc. (Ross) in April, 2000. Prior to working for Ross,

Plaintiff had a documented history of chronic headaches,

depression and ischemic attacks.

As a Ross employee, Plaintiff was covered by an employee

welfare benefit plan, as that term is defined by the Employee

Retirement Income Security Act (ERISA), which was issued by

LINA. Plaintiff was covered by group policy number LK-030075

(Policy), which, along with several attached documents,

purported to constitute the entire benefits contract between

Plaintiff and his employer. The Policy pays benefits for up to

thirty-six months if an insured becomes unable to perform his

job duties because of sickness or injury. Long term disability

benefits are paid beyond thirty-six months if the insured person

cannot thereafter perform the material duties of any job because

of the sickness or injury. Employees are eligible for coverage

under the Policy as long as they are in active service with the

company, which generally means that they must be working on a

full-time basis. The Policy also provides for a ninety-day

waiting period for receiving benefits.

In addition to the Policy, Ross issues an annual summary

plan description (SPD), which purports to explain both the group

plan benefits and the employees’ rights under ERISA. The SPD

was not attached to the Policy and is not included in the

administrative file. The SPD, inter alia, grants LINA

discretion to interpret the terms of the Policy. Neither the

Policy nor the documents attached to it grant such discretion to

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United States District Court

For the Northern District of California

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LINA.

On or about July 16, 2002, Plaintiff stopped going to work. 

He did not thereafter return. On or about November 4, 2002,

Plaintiff submitted to LINA a claim for long term disability

benefits. In a letter dated November 5, LINA informed Plaintiff

that it was his responsibility as well as the responsibility of

his treating physicians to submit all relevant medical

information necessary to support his claim. On November 12, Dr.

Schwartz, Plaintiff’s treating physician at that time, diagnosed

him with bilateral carpal tunnel syndrome. LINA learned of Dr.

Schwartz’s diagnosis no later than December 6, 2002. However,

despite several requests that he do so, Plaintiff failed to

submit to LINA before its deadline a Disability Proof of Loss. 

Noting that Plaintiff had failed to submit this critical

document, and also noting that the only medical information that

it had been able to obtain from Plaintiff was Dr. Schwartz’s

diagnosis, LINA denied Plaintiff’s claim for long term

disability benefits on December 23, 2002.

Plaintiff finally submitted his Disability Proof of Loss on

or shortly after December 29, 2002. In that document, Plaintiff

cited only the following disabling condition: “Unspecified

surgery: severe carpal tunnel syndrome on both arms. Severe

pain in arms and wrists, numbness in fingers.” Plaintiff also

stated that, at the time, he was prevented from working by

orders from Dr. Jayaram, whom he had began seeing in September,

2002. On January 13, 2003, Plaintiff appealed LINA’s denial of

his benefit claim; in his appeal letter, Plaintiff acknowledged

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United States District Court

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that he had failed to submit timely the required medical

information to support his initial claim. Plaintiff was

represented by counsel in his appeal.

In processing Plaintiff’s appeal, LINA reviewed medical

information from four treating physicians: Drs. Lin, Jayaram,

Schwartz and Bhakta. On June 7, 2002, just before Plaintiff had

stopped working, Dr. Lin, Plaintiff’s neurologist, had

documented that Plaintiff was experiencing numbness and a

tingling sensation in his hands. On July 25, 2002, shortly

after Plaintiff had stopped working, Dr. Lin wrote that

Plaintiff’s condition was improving. On that same date, Dr. Lin

also noted that Plaintiff informed him that he had suffered a

panic attack and had been placed on disability by his treating

psychologist/psychiatrist. There is no record in the

administrative file of any physician placing Plaintiff on

disability at that time. A note in the file from Dr. Bhakta,

Plaintiff’s treating psychologist/psychiatrist since 1999, does

report that Plaintiff had been unable to work due to psychiatric

illness, but only starting February 26, 2003.

As part of the peer review portion of the appeal process,

all of Plaintiff’s medical records were reviewed by Dr.

Nettrour, a board-certified orthopedic surgeon. Dr. Nettrour

opined that Plaintiff’s diagnosis of carpal tunnel syndrome was

supported by the documented symptoms and testing. He also noted

that Plaintiff had undergone surgery for his right carpal tunnel

on March 14, 2003. Following Plaintiff’s surgery, Dr. Schwartz

ordered him off work until May 1, 2003. However, as noted by

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United States District Court

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Dr. Nettrour in his peer review, there is no record in the

administrative file of any treating physician ordering Plaintiff

off work, for any reason, in July, 2002 or during the subsequent

ninety-day benefit waiting period. As a result of this finding,

on April 30, 2003, LINA affirmed its denial of Plaintiff’s claim

for long term disability benefits.

On August 6, 2004, the Court held a case management

conference; Plaintiff did not make an appearance. At the

conference, the Court ruled that the matter would be decided on

Rule 52 cross-motions based upon the evidence contained in the

administrative record. See Kearney v. Standard Ins. Co., 175

F.3d 1084, 1095 (9th Cir. 1999). Thus, Plaintiff’s motion for

summary judgment will be treated as a Rule 52 motion, and

Defendants’ motion as a cross-motion.

LEGAL STANDARD

ERISA provides Plaintiff with a federal cause of action to

recover the benefits he claims are due under the 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.; Taft v. Equitable Life Assurance Soc’y, 9 F.3d

1469, 1471 (9th Cir. 1993). The Ninth Circuit has also referred

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United States District Court

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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

Plaintiff contends that, because the Policy did not give

LINA discretionary authority to construe terms of the health

plan, the Court should review the denial of benefits de novo. 

Defendants argue that the applicable SPD gives LINA

discretionary authority; thus, the Court should review the

denial using an “abuse of discretion” standard.

Plaintiff cites Grosz-Salomon v. Paul Revere Life Ins. Co.,

237 F.3d 1154 (9th Cir. 2001), in support of his argument for de

novo review. In Grosz-Salomon, the plaintiff signed a policy

that did not expressly confer discretionary authority to the

insurer, but a subsequent “Benefit Summary” prepared by the

insurer and distributed by the employer purported to do so. Id.

at 1157. The Ninth Circuit ruled that the subsequent plan

summary language was invalid. That was true, according to the

court, because (1) the initial policy purported to be fully

integrated, and (2) the summary was not an amendment because it

failed to conform with policy provisions describing amending the

plan. Id. at 1161.

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For the Northern District of California

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2 The Court GRANTS Plaintiff’s request for judicial notice

in support of his motion for summary judgment (Docket No. 29).

7

Here, as in Grosz-Salomon, the Policy purports to be fully

integrated. Additionally, the SPD does not comport with the

Policy’s provisions regarding amending. Specifically, according

to the Policy, amendments must be approved by an executive

officer of LINA. Here, the SPD was prepared and distributed by

Ross, and there is no evidence that it was ever approved by

anybody at LINA.

Defendants attempt to distinguish Grosz-Salomon from the

facts in this case. First, Defendants argue that it is

significant that Ross, and not LINA, issued the SPD. That

argument is not persuasive. Defendants’ argument that the SPD

and the Policy do not conflict is similarly unpersuasive. The

case law is clear that, absent express language in the Policy

conferring discretionary authority to the insurer, denials of

benefits are reviewed de novo. Firestone, 489 U.S. at 115. 

There is no dispute here that the Policy confers no such

authority.

In support of his argument for de novo review, Plaintiff

also cites an opinion letter, dated February 26, 2004, from the

general counsel for the California Insurance Commissioner.2 That

letter, according to Plaintiff, purported to invalidate

discretionary clauses like the one at issue here. However, even

if such opinion letters were binding on the Court, the letter

cited by Plaintiff only operates, by its own terms,

prospectively. Ex. 3 to Pl.’s Req. for Judicial Notice; see

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also Firestone v. Acuson Corp. Long Term Disability Plan, 326 F.

Supp. 2d 1040, 1050-51 (N.D. Cal. 2004). Plaintiff does not

argue, nor does he cite any authority suggesting, otherwise.

For the foregoing reasons, it appears that a de novo review

standard is appropriate in this case. However, it is

unnecessary to state a legal conclusion as to which standard the

Court must apply because Plaintiff is not entitled, even under a

de novo review of the administrative file, to long term

disability benefits. Thus, regardless of which standard the

Court applies, Plaintiff cannot prevail.

II. De Novo Review

There is no evidence in the administrative file or

otherwise cited in Plaintiff’s papers supporting his assertion

that he was disabled on or around July 16, 2002, or at any time

during the subsequent ninety-day benefit waiting period. 

Plaintiff maintains that there is no record in the

administrative file that he was placed on disability at that

time because Defendants failed to investigate his claim

adequately. He now contends that Dr. Cooper, a psychologist who

is listed among Plaintiff’s treating physicians in the

Disability Proof of Loss, placed him on disability for

psychiatric conditions that were exacerbated by the onset of

carpal tunnel syndrome.

However, in his Disability Proof of Loss, the only

disabling condition that Plaintiff claimed was carpal tunnel

syndrome, and the treating physician that he claimed ordered him

to stop working was Dr. Jayaram. Plaintiff is correct that,

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under Title 29 U.S.C. section 1133(2), he is entitled to a “full

and fair review” of his benefit claim. But, if Plaintiff

considered the medical information that LINA had to be

insufficient, he was obliged to provide LINA with information

that could support his claim for benefits. See Kearney, 175

F.3d at 1091. That is especially true if, as Plaintiff now

contends, he misidentified, in his Disability Proof of Loss,

both his disabling condition and the treating physician who

ordered him to stop working. Moreover, Plaintiff was

represented by counsel in his appeal, and yet he nevertheless

failed to submit proof that he was placed on disability by any

physician in July, 2002. Notably, Plaintiff does not, and

cannot, dispute that it was his burden to provide sufficient

proof of disability.

There is evidence in the administrative file to support a

claim that Plaintiff was disabled as of February 26, 2003 due to

mental illness, and from March 14 to May 1, 2003 due to surgery

for carpal tunnel syndrome. However, as Defendants note,

Plaintiff was no longer eligible for benefits at either time

because he had stopped working for Ross in July, 2002.

Because there is no evidence in the record that Plaintiff

was disabled when he stopped working or at any time during the

subsequent ninety-day waiting period, LINA’s denial of his claim

for long term disability benefits was appropriate. Thus, the

denial of Plaintiff’s claim for benefits withstands both de novo

and abuse of discretion standards of review.

CONCLUSION

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United States District Court

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For the foregoing reason, the Court DENIES Plaintiff’s

motion for summary judgment (Docket No. 27) and GRANTS

Defendants’ motion for judgment under Federal Rule of Civil

Procedure 52 (Docket No. 37). Plaintiff’s request for judicial

notice in support of his motion for summary judgment (Docket No.

29) is GRANTED. The clerk shall enter judgment and close the

file. All parties shall bear their own costs.

IT IS SO ORDERED.

Dated: 6/21/05 /s/ CLAUDIA WILKEN 

CLAUDIA WILKEN

United States District Judge

Case 4:04-cv-00413-CW Document 45 Filed 06/21/05 Page 10 of 10