Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_09-cv-01766/USCOURTS-azd-2_09-cv-01766-1/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

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Bruce Kurchack, 

Plaintiff, 

vs.

Life Insurance Company of North

America; RBC Wealth Management

Disability Plan, 

Defendants. 

)

)

)

)

)

)

)

)

)

)

)

)

)

)

No. CV-09-1766-PHX-GMS

ORDER

Pending before the Court are a Motion for Summary Judgment (Doc. 32) filed by

Plaintiff Bruce Kurchack and a Motion for Summary Judgment (Doc. 37) filed by

Defendants Life Insurance Company of North America (“LINA”) and RBC Wealth

Management Disability Plan (“RBC Plan”). For the following reasons, the Court denies

Plaintiff’s motion and grants in part and denies in part Defendants’ motion.

BACKGROUND

RBC Wealth Management hired Plaintiff Kurchack as a Senior Vice President on July

14, 2006. (Doc. 33; 38). As an employee, Kurchack was eligible to receive protection under

the RBC Plan, which is a qualified plan under the Employee Retirement Income Security Act

(“ERISA”). (Doc. 14). On August 20, 2008, Kurchack stopped working due to a disability,

which he described as severe depression and anxiety.

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 1 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 2 -

Kurchack submitted a request for short term disability (“STD”) benefits and provided

supporting medical documentation, including a form which indicated that his treating

physician believed that Kurchack was disabled from his own occupation. (Doc. 33; 38).

LINA concluded that the medical information supported the recommendation that Kurchack

not work through September 14, 2008 and sent Kurchack a letter on September 3, 2008,

informing him that he was approved for STD benefits for the period beginning August 28,

2008 through September 14, 2008. 

On October 1, 2008, LINA sent Plaintiff a letter denying STD benefits beyond

September 14, 2008, following a determination by DJ McDowell, PhD, that Plaintiff had not

presented evidence of a global functional impairment. (Doc. 32; 38). Kurchack appealed the

decision to deny benefits in late November 2008; the appeal was denied on March 12, 2009.

(Doc. 31, Ex. 1; 38). Following the appeal, Plaintiff filed his Complaint, alleging that LINA

did not provide a plausible basis for denying Kurchack’s claim and seeking unpaid disability

benefits under the RBC Plan from September 14, 2008 forward. (Doc. 1).

DISCUSSION

I. Legal Standard

Summary judgment is appropriate if the evidence, viewed in the light most favorable

to the nonmoving party, demonstrates “that there is no genuine issue as to any material fact

and that the movant is entitled to judgment as a matter of law.” FED. R. CIV. P. 56(c)(2).

Substantive law determines which facts are material and “[o]nly disputes over facts that

might affect the outcome of the suit under the governing law will properly preclude the entry

of summary judgment.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “A fact

issue is genuine ‘if the evidence is such that a reasonable jury could return a verdict for the

nonmoving party.’” Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002)

(quoting Anderson, 477 U.S. at 248). Thus, the nonmoving party must show that the genuine

factual issues “‘can be resolved only by a finder of fact because they may reasonably be

resolved in favor of either party.’” Cal. Architectural Bldg. Prods., Inc. v. Franciscan

Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir. 1987) (quoting Anderson, 477 U.S. at 250).

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 2 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 3 -

The standard is no different for a case which must be tried on an administrative record.

Kearney v. Standard Ins. Co., 175 F.3d 1084, 1093–94 (9th Cir. 1999).

II. Plaintiff’s Motion for Summary Judgment

Under 29 U.S.C. § 1132(a)(1)(B), a participant or beneficiary may bring an action “to

recover benefits due to him under the terms of his plan [or] enforce his rights under the terms

of the plan”. Here, the parties agree that the Court should review the denial of benefits de

novo. (Doc. 36); see Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989) (“[A]

denial of benefits challenged under § 1132(a)(1)(B) is to be reviewed under a de novo

standard unless the benefit plan gives the administrator or fiduciary discretionary authority

to determine eligibility for benefits or to construe the terms of the plan.”). Under de novo

review, no deference is given to LINA’s decision to deny benefits. Kearney, 175 F.3d 1090

n.2. Kurchack carries the burden of establishing that he was entitled to benefits under the

terms of the STD Plan. Muniz v. Amec Constr. Mgmt., Inc., 623 F.3d 1290, 1294 (9th Cir.

2010). This remains true even after an initial award of benefits. Id. at 1296.

A. Administrative Record

Plaintiff asserts that he met the definition of disabled, and therefore, the Court should

grant him STD benefits; however, Plaintiff, who holds the burden of establishing that he was

disabled, has not pointed to sufficient evidence from the administrative record that is

uncontested to warrant summary judgment on this issue. When a court reviews a denial of

benefits de novo, the “court simply proceeds to evaluate whether the plan administrator

correctly or incorrectly denied benefits”. Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955,

963 (9th Cir. 2006). Generally, the court should limit its inquiry to the evidence in the

administrative record. See Opeta v. Nw. Airlines Pension Plan for Contract Emps., 484 F.3d

1211, 1217 (9th Cir. 2007). Under certain limited circumstances, when it is “clearly

establish[ed] that additional evidence is necessary to conduct an adequate de novo review

of the benefit decision”, the Court may in its discretion consider evidence outside the

administrative record. Id. (internal quotation marks omitted); see Muniz, 623 F.3d at 1297

(district courts have discretion to admit additional evidence when the evidence is necessary

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 3 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 4 -

to conduct an adequate de novo review of the denial). However, “‘[in] most cases’ only the

evidence that was before the plan administrator at the time of determination should be

considered.” Opeta, 484 F.3d at 1217 (quoting Mongeluzo v. Baxter Travenol Long Term

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

Plaintiff seeks to supplement the administrative record and has attached to his Reply

(Doc. 40) a series of documents not contained in the administrative record and an affidavit

by Plaintiff’s counsel, stating that counsel has “personal knowledge of the facts and

circumstances set forth in this declaration”, (Id., Ex. 1). Plaintiff asserts that the medical

records, attached as Exhibit 2, were not made part of the administrative record because

Defendants never raised the issue of Kurchack’s failure to establish that he was under the

ongoing care of a medical doctor. (Doc. 40). It is unclear why Plaintiff would not present to

LINA all the documentation he had about his disability and treatment during the

administrative review process, but in any event, Plaintiff has not presented an argument that

falls within the “exceptional circumstances” set forth in Opeta, based on which the Ninth

Circuit has determined evidence outside the administrative record warrants consideration.

Cf. Opeta, 484 F.3d at 1217–18 (discussing with approval a district court decision to admit

additional evidence where “the plan administrator had prevented the plaintiff from providing

medical records to support his claim during its review and the administrative record included

only incomplete, illegible, and disorganized medical records”).

In addition, Kurchack offers various documents of unknown sourcesrelated to claims

policies and procedures. (Doc. 40, Ex. 3). The documents range from manuals on how to

address specific issues that may be raised in a clam to emails between parties unknown to the

Court and court documents from a case in the Southern District of New York. Plaintiff has

not argued why any of these documents should be deemed clearly necessary to conduct an

adequate de novo review of LINA’s decision and admitted by the court. See Opeta, 484 F.3d

at 1217. Furthermore, the Court, in its discretion, concludes that, unless it determines that it

will consider Defendants’ newly asserted basis for determining Plaintiff was ineligible for

benefits, the expansion of the administrative record to include these various documents is

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 4 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 5 -

unnecessary to conduct an adequate de novo review, and thus the Court will not consider any

of the exhibits attached to Document 40 for purposes of the pending motions for summary

judgment.

B. Plaintiff’s Challenges to the Denial of STD Benefits

Kurchack first asserts that he met the plan’s definition of disabled, and the fact that

LINA had previously determined that he was disabled, and the reviewer stated that there was

no change in his condition, supports this conclusion. (Doc. 32). Defendants assert a new

argument not included in their initial denial that to be disabled, “Kurchack must have been

‘under the direct, ongoing care of a medical doctor who determines that [he] is unable to

perform the duties of the job for more than five workdays because of a qualifying

disability.’” (Doc. 36). However, according to Defendants, the administrative record

establishes that Plaintiff was not under the “direct and ongoing care of a medical doctor”, and

therefore he does not meet the plan’s definition of disabled. (Id.). Kurchack contends that

Defendants’ purported reason for denying his claim is a post-hoc rationale that the Court

cannot consider. (Doc. 40). 

When denying a claimant’s request for benefits, ERISA requires a “‘full and fair’

assessment of [the] claims and clear communication to the claimant of the ‘specific reasons’

for benefit denials.” Black & Decker Disability Plan v. Nord, 538 U.S. 822, 825 (2003)

(citing 29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1 (2002)). Here, the letter informing

Kurchack of the denial of benefits stated the information on file “does not, to a reasonable

medical certainty, support a global functional impairment, serious psychiatric symptoms, or

work incapacity.” (Doc. 31, Ex. 2 DEF 271). Defendants now argue that Plaintiff’s claim was

denied because he did not establish that he was under the direct and ongoing medical care

of any one doctor. Defendants contend that this argument is consistent with the reason

provided in the October 1 letter. The Court disagrees.

Although the Ninth Circuit has rejected explanations for a denial of benefits first

presented during litigation, see Jebian v. Hewlett-Packard Co. Emp. Benefits Org. Income

Prot. Plan, 349 F.3d 1098, 1104 (9th Cir. 2003) (“a contrary rule would allow claimants,

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 5 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

 The form filled out by Dr. Jay Friedman on August 29, 2008, states that the next visit

was scheduled in 2 weeks. (Doc. 31, Ex. 2 DEF 283). The October 1, 2008 letter informing

Kurchack of the initial denial of benefits states that Kurchack told LINA that he saw Dr.

Friedman on September 21, 2008. (Doc. 31, Ex. 2 DEF 270). It is unclear if Kurchack was

referring to the same visit listed in the form filled out by Dr. Friedman.

2

 Although Plaintiff appears to have visited Dr. Friedman on multiple occasions, for

some reason Plaintiff has conceded that he was not under the direct and ongoing care of Dr.

Friedman. (Doc. 41).

- 6 -

who are entitled to sue once a claim had been ‘deemed denied,’ to be ‘sandbagged’ by a

rationale the plan administrator adduces only after the suit has commenced”), as Defendants

noted, the assertion of a post-hoc rationale may not be prohibited if the review is de novo as

is the case here, see id. at 1105–06. But, even if the Court considers Defendants’ argument,

the argument is unavailing. In reviewing a plan, the Court must “‘interpret terms in ERISA

insurance policies in an ordinary and popular sense as would a person of average intelligence

and experience.’” Padfield v. AIG Life Ins. Co., 290 F.3d 1121, 1125 (9th Cir. 2002) (quoting

Babikian v. Paul Revere Life Ins. Co., 63 F.3d 837, 840 (9th Cir. 1995)). At issue here is the

interpretation of “direct and ongoing care of a medical doctor.” Defendants contend that

because Kurchack only saw each of the three doctors listed once during the period at issue

for STD benefits, he has not satisfied the definition of disabled. (Doc. 36).

The record suggests that Plaintiff saw Dr. Jay Friedman, who appears to be his

primary care physician, on August 21 and 27, 2008;1

 Dr. Sheldon Wagman, DO, who

specializes in psychiatry, on September 8, 2008; and Counselor Ken Wells on October 30,

2008. Plaintiff was denied continuing coverage on October 1, 2008. At that time, he had not

yet provided documentation from Dr. Wagman or Counselor Wells. (Doc. 31, Ex. 2 DEF

243–44). Considering Defendants’ argument, it appears from the record that Plaintiff did visit

Dr. Friedman on multiple occasions.2

 Setting that fact aside, it is not obvious from the

definition of disabled that a claimant must be under the “direct and ongoing care” of one

single doctor. It is common for a doctor to refer a patient to another doctor. Here, the form

completed by Dr. Friedman after the August 27, 2008 visit indicates that he referred Plaintiff

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 6 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 7 -

to Dr. Marcus Earle, who works with Ken Wells. (Doc. 31, Ex. 3 DEF 369). Moreover,

although the doctors he visited did not schedule follow up appointments, a reasonable fact

finder nevertheless could conclude that he was disabled as defined by the Plan, determining

that follow up appointments were unnecessary given that the doctors had prescribed him a

number of medications for his disability.

Kurchack makes a number of additional arguments regarding LINA’s decision to deny

benefits. He argues that LINA must have improperly denied his claim because LINA

initially determined that he was disabled and later concluded that, although there was no

change in his condition, he no longer met the definition of disabled. (Doc. 32). “[T]he fact

that the claimant was initially found disabled under the terms of the plan may be considered

evidence of the claimant’s disability, but . . . [this does not suggest] that paying benefits

operates forever as an estoppel so that an insurer can never change its mind.” Muniz, 623

F.3d at 1296–97 (internal citation and quotation marks omitted). Plaintiff relies on Montour

v. Hartford Life & Accident Ins. Co., 588 F.3d 623 (9th Cir. 2009), which is factually

distinguishable. In Montour, the insurance company had paid the claimant disability benefits

for over two years, and then found him no longer disabled. Id. at 635. Under those

circumstances, the Ninth Circuit noted that it would be reasonable to expect that the

insurance company based this decision on evidence of improvement in the claimant’s

condition, rather than a lack of degeneration. Here, LINA approved benefits for

approximately two weeks and then denied further benefits. A reasonable fact finder could

conclude that the initial granting of benefits should not be weighted as heavily as it was in

Montour given the obvious distinctions in the facts of the two cases.

In his motion, Plaintiff also seems to suggest that Defendants erred in accepting the

opinion of a non-examining psychologist and RN over the opinion of his medical doctor on

the issue of his disability. (Doc. 32). Plaintiff asserts that in doing so, LINA arbitrarily

refused to credit reliable evidence, including the opinions of his treating physicians in

violation of Black & Decker, 538 U.S. at 834. He further characterizes LINA’s staffs’

conclusions as “biased and unreasonable.” To the extent that Plaintiff is suggesting that

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 7 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 8 -

because LINA chose not to have its own doctor personally evaluate Plaintiff, LINA was

required to “accord special weight to the opinions of [Plaintiff’s] treating physician”, Plaintiff

is incorrect. See id. Moreover, Plaintiff has not pointed to sufficient evidence for the Court

to conclude at this stage that any denial of benefits was unreasonable and based on some bias

on the part of LINA’s staff. It is clear from the initial denial letter that LINA’s staff did not

have a significant amount of documentation on Plaintiff’s disability at that time. (Doc. 31,

Ex. 2). In fact, LINA did not receive documentation from Dr. Wagman on the September 8,

2008 visit until October 2, 2008, a day after the initial denial of benefits. Nevertheless, after

receiving this additional information, Dr. McDowell again reviewed Plaintiff’s claim, a point

that Plaintiff concedes. (Doc. 41). Nothing in the record demonstrates beyond dispute that

LINA “arbitrarily refused to credit reliable evidence.” Thus, the fact that LINA’s staff

ultimately determined that the documentation it received from Dr. Friedman, and later from

Dr. Wagman, did not establish a disability does not in itself prove that LINA came to an

unreasonable conclusion.

Plaintiff also contends that a paper review of his claim, which LINA apparently

conducted, was not permitted by the plan. (Doc. 32). Plaintiff quotes language stating that

“RBC may require [Kurchack] to obtain the opinion of a different medical doctor at the cost

of the company.” (Doc. 32). Nothing about this statement suggests that a paper review of a

STD benefits claim is prohibited by the terms of the plan. Rather, the language quoted simply

states that should RBC choose to seek the opinion of an additional medical doctor, it may do

so, but at its own expense. 

Plaintiff raises the argument that based on the definition of disability, a medical doctor

was required to make the determination of whether Plaintiff met the definition of disabled.

(Doc. 32). In this case, the review was not conducted by a medical doctor, but rather by

LINA’s consulting psychologist, Dr. McDowell, and in-house nursing staff who never

examined Plaintiff. (Doc. 38). Plaintiff points to the part of the definition, which states that

“a medical doctor [must] determine[] that [he] is unable to perform the duties of the job for

more than five workdays because of a qualifying disability.’” (Doc. 36). The STD plan

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 8 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 9 -

definition of disability, however, does not require that the Plan have a medical doctor

determine that the claimant is able to perform the duties of the job to deny benefits. The plain

meaning of the plan is that to be considered for STD benefits, a claimant must establish that

a medical doctor has determined that he is unable to perform his job for a certain period of

time. The definition says nothing about the claim review process.

Plaintiff also contends that on appeal deference was given to Dr. McDowell’s opinion

from the initial claims denial in violation of certain ERISA regulations. Specifically, Plaintiff

cites 29 C.F.R. § 2560.503-1(h)(4), which refers to the requirements with which claims

procedures must comply to “be deemed to provide a claimant with a reasonable opportunity

for a full and fair review of a claim and adverse benefit determination.” The regulations call

for providing claimants an opportunity to supplement their claims, and require the entity

reviewing the appeal to take into account all information in the record, consult a health care

professional who was not involved in the initial adverse determination, and not give

deference to that initial determination. 29 C.F.R. § 2560.503-1(h). Plaintiff points to a

document from December 2008 completed by LINA employees, stating that “new medical

information [was] received–no new findings that would change previous recommendation

by Dr. McDowell staffing.” (Doc. 31, Ex. 2 DEF 000274). It appears that the document was

completed several months before LINA made a final determination about Plaintiff’s appeal,

and according to Defendants, before the claim was referred to LINA’s appeals team. (Doc.

37). The March 12, 2009 letter notifying Plaintiff’s counsel that LINA was upholding the

prior decision to deny benefits states that LINA reviewed Plaintiff’s record in its entirety

“without deference to prior reviews” and that to “ensure that the medical evidence was

interpreted appropriately, the file was reviewed with a Medical Consultant.” (Doc. 31, Ex.

4 DEF 386). Thus, there is an issue of fact as to whether LINA’s review of Plaintiff’s appeal

complied with the ERISA regulations. 

There is some evidence that LINA may have applied the wrong diagnostic code, using

311 (Doc. 38), instead of the codes listed by the treating physicians, 296.32, 300.02 and

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 9 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

 Plaintiff contends that LINA’s failure to discuss Kurchack’s GAF score is also

indicative of LINA’s failure to reasonably review his claim. Dr. McDowell’s October 8, 2008

claim strategy form does acknowledge Dr. Wagman’s estimate of a GAF of 50, and notes

that the highest GAF in the last year was also at 50. (Doc. 31, Ex. 1 DEF 000185).

Accordingly, the Court assumes that this factor was taken into consideration at least in

LINA’s denial of Plaintiff’s appeal. 

- 10 -

307.50, (Doc. 31, Ex. 3).3

 However, Plaintiff has not provided any admissible evidence

interpreting the codes. That discrepancy, combined with Defendants’ interpretation of

“direct, ongoing care of a medical doctor”, alone is not sufficient evidence at this stage for

the Court to conclude that Plaintiff was entitled to STD benefits. Plaintiff challenges the

denial on a number of other bases, unsupported by any Ninth Circuit case law, including that

the claim was reviewed without conducting an in-person medical evaluation. As Plaintiff

notes, such arguments go to issues of fact related to the thoroughness and accuracy of the

review, and therefore, cannot be resolved on a motion for summary judgment. (Doc. 32 at

14). Plaintiff has not met his burden of establishing that he was entitled to STD benefits, and

therefore, his Motion for Summary Judgment is denied.

III. Defendants’ Cross-Motion for Summary Judgment

In their Cross-Motion for Summary Judgment, Defendants seek a determination that

Kurchack’s maximum possible award of damages is limited to twelve weeks of STD benefits.

(Doc. 37). In his Complaint, Kurchack requested an award of “all benefits due Plaintiff in the

past and future under the plan, plus interest.” (Doc. 1). However, in his Motion for Summary

Judgment, Plaintiff only requested the remaining ten weeks of STD benefits that he alleges

are owed him. (Doc. 32). Defendants now assert that because Kurchack never returned to

work, he was ineligible to receive the second possible set of twelve weeks of STD benefits.

(Doc. 37). Additionally, Defendants argue Plaintiff never applied for long term disability

(“LTD”) benefits. Accordingly, at most Kurchack could be awarded damages stemming from

a determination that he was disabled during the first twelve weeks from the time he sought

STD benefits.

Plaintiff does not address Defendants’ argument that he was ineligible to receive the

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 10 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

4

 According to STD Policy, if an employee becomes disabled again after having

received STD benefits, that employee may be eligible for an additional period of STD

benefits but only after the employee has returned for at least “four full consecutive weeks

between the periods of disability.” (Doc. 31). Plaintiff neither challenges the accuracy of

Defendants’ recitation of the policy nor does he allege that he in fact returned to work and

satisfied the eligibility requirements of the Plan. 

5

 Plaintiff’s Complaint states that on October 1, 2008, “Defendant LINA denied

Plaintiff’s long term disability benefits.” (Doc. 1). That was the date of the initial letter

denying Plaintiff a continuation of STD benefits. (Doc. 33; 38). Thus, Plaintiff appears to

have mistakenly stated that his LTD benefits were denied. 

- 11 -

second set of STD benefits and does not appear to argue that he should have received such

benefits. Accordingly, the Court assumes that Plaintiff has conceded that he is ineligible for

such benefits.4

 Defendants also assert that Plaintiff may not be awarded LTD benefits

because he failed to exhaust administrative remedies by not applying for such benefits. In his

Motion for Summary Judgment, Plaintiff does not request LTD benefits, and in his Response

to the Cross-Motion he seems to suggest that he has not asserted a claim for LTD benefits

here, yet he argues that Defendants’ motion should be denied as to these benefits. (Doc. 32;

40). It is unclear whether Plaintiff’s Complaint asserts that he is entitled to benefits under the

LTD plan and that he was denied such benefits.5

Generally, a claimant challenging a denial of benefits under an ERISA plan “‘must

avail himself or herself of a plan’s own internal review procedures before bringing suit in

federal court.’” Vaught v. Scottsdale Healthcare Corp. Health Plan, 546 F.3d 620, 626 (9th

Cir. 2008) (quoting Diaz v. United Agric. Emp. Welfare Benefit Plan & Trust, 50 F.3d 1478,

1483 (9th Cir. 1995)). Plaintiff concedes that he did not submit a notice of claim or otherwise

apply for LTD benefits; however, he argues that he was not required to apply for such

benefits because doing so would have been futile. (Doc. 40). The Ninth Circuit has

recognized some exceptions to the exhaustion requirement, including “where a plan fails to

establish or follow ‘reasonable’ claims procedures as required by ERISA” or when “resort

to the administrative route is futile.” Id. at 626–27.

Plaintiff first asserts that the LTD plan and RBC Long-Term Disability Summary Plan

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 11 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 12 -

Description (“SPD”) fail to contain any language describing internal review procedures in

violation of 29 C.F.R. § 2560.503-1. (Doc. 40). Plaintiff also appears to argue that he did not

have notice that he was required to initiate a claim for LTD benefits. As to that argument, the

STD policy explains that an employee may be eligible for LTD benefits if the disability

continues for more than 90 days. (Doc. 31). In such a case, “[e]mployees should contact the

HR Service Center for more information on how to apply for LTD benefits as soon as it

becomes evident that the disability may continue longer than 90 days.” (Id. (emphasis

added)). Regarding Plaintiff’s argument that neither the SPD nor the policy contain “any

language describing any sort of internal review procedure”, a quick review of the SPD alerts

the reader that if a claim is denied in whole or in part, the claimant has “the right to have the

Plan review and reconsider your claim.” (Doc. 31, DEF 75). The SPD then explains under

what circumstances a claimantmay have anERISA claim. Furthermore, the SPD specifically

incorporates by reference the Certificate of Insurance, which is attached to the SPD, and

notifies the employee that more detailed information regarding Claim and Appeal Provisions

is included therein. The Certificate of Insurance explains that once an employee is eligible

to receive benefits, the employee “must request a claim form or obtain instructions for

submitting [the] claim telephonically or electronically”. (Doc. 31, Ex. 1). It also explains the

notice procedure for informing employees that a claim has been denied and the procedure for

appealing a denial of benefits. (Doc. 31, Ex. 1 DEF 105). Thus, Plaintiff’s argument is not

supported by the record.

Plaintiff asserts that applying for LTD benefits following the denial of STD benefits

would have been futile because the definition of “disability” for purposes of a determination

of LTD benefits is more restrictive than that used to determine eligibility for STD benefits.

(Doc. 40). Plaintiff cites Turnipseed v. Educ. Mgmt. LLC’s Emp. Disability Plan, which does

not actually reach the issue because the complaint at issue was too vague to consider the

argument. 2010 WL 140384, *2 n.2 (N.D. Cal. Jan. 13, 2010). However, that court cited

Darensbourg-Tillman v. Robins, Kaplan, Miller & Ciresi LLP Short Term Disability Plan,

2004 WL 5603225 (C.D. Cal. Sept. 3, 2004), in which the district court denied a motion to

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 12 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 13 -

dismiss an LTD benefits claim where the plaintiff’s claim for STD benefits was denied and

plaintiff alleged that “as a direct proximate result of the ‘wrongful conduct of the STD Plan

and Unum [in denying her STD claim], Plaintiff [was] wrongfully precluded from obtaining”

LTD benefits. 2004 WL 5603225, at *3. The district court compared the STD plan language,

which required “only that the insured be ‘limited from performing the material and

substantial duties [of your regular occupation],’ while the LTD Plan require[d] that the

insured ‘cannot perform each of the material duties.’” Id. The court noted that, because the

defendant had not yet shown “how plaintiff could have been denied STD benefits and still

receive LTD benefits”, plaintiff was excused from meeting the exhaustion requirement. Id.

Here, the STD plan defines disabled as being “under the direct, ongoing care of a

medical doctor who determines that [the claimant] is unable to perform the duties of the job

for more than five workdays because of a qualifying disability.” (Doc. 31). A “qualifying

disability is one in which an employee is unable to perform the material duties of the job

solely due to a covered injury or illness.” (Doc. 38; 41). The LTD plan states that the

claimant must be (a) “unable to perform the material duties of [his] regular occupation, or

solely due to Injury or Sickness, [he is] unable to earn more than 80% of [his] Indexed

Covered Earnings”, and (b) “[a]fter Disability Benefits have been payable for 24 months, [he

is] unable to perform the material duties of any occupation for which [he] may reasonably

become qualified based on education, training or experience, or solely due to Injury or

Sickness, [he is] unable to earn more than 80% of [his] Indexed Covered Earnings.” (Doc.

31, Ex. 1 DEF 101).

To receive either STD or LTD benefits, the claimant must be unable to perform the

material duties of his job. Thus, the terms of these plans are distinguishable from the terms

of the plans at issue in Darensbourg-Tillman, in which the STD plan only required some

limitation to the claimant’s ability to perform the duties of his job, while the LTD plan

required total inability to perform the material duties of the occupation. Nevertheless, a

reasonable fact finder could conclude that because the standard for establishing eligibility for

STD benefits mirrors the standard for establishing eligibility for LTD benefits, it would have

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 13 of 14
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

- 14 -

been futile for Plaintiff to apply for LTD benefits. Accordingly, Defendants’ motion is denied

as to this point.

Plaintiff also generally argues that a claimant is excused from the exhaustion

requirement when the evidence demonstrates that a plan administrator is biased and certainly

would have denied a claim or when “an insurer had abused its discretion in failing to find a

person disabled under an ‘own occupation’ standard”. (Doc. 40). However, Plaintiff does not

actually argue that there is evidence in the administrative record supporting his contention

that LINA was biased and would not have fairly considered his claim, and therefore, Plaintiff

has not established that applying for LTD benefits would have been futile on this basis.

IT IS THEREFORE ORDERED that Plaintiff’s Motion for Summary Judgment

(Doc. 32) is DENIED.

IT IS FURTHER ORDERED that Defendants’ Motion for Summary Judgment

(Doc. 37) is GRANTED IN PART AND DENIED IN PART.

The Case Management Order (Doc. 28), dated September 10, 2010, set a briefing

schedule, which provided the following deadlines: (1) Plaintiff’s Opening Brief would be due

April 22, 2011; (2) Defendants’ Responsive Brief would be due May 20, 2011; and (3)

Plaintiff’s Reply Brief would be due June 10, 2011. Because the parties have not filed their

respective briefs by the deadlines set in that Order, the parties have waived the right to file

those documents. 

The Final Pretrial Conference is scheduled for Friday, September 23, 2011, at 2:00

p.m. in Courtroom 602, Sandra Day O’Connor U.S. Federal Courthouse, 401 W. Washington

St., Phoenix, Arizona 85003-2151.

DATED this 15th day of August, 2011.

Case 2:09-cv-01766-GMS Document 43 Filed 08/16/11 Page 14 of 14