Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-00258/USCOURTS-cand-3_06-cv-00258-4/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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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

CHRISTINE ONDERSMA,

Plaintiff,

 v.

METROPOLITAN LIFE INSURANCE

COMPANY, et al.,

Defendants

 /

No. C-06-0258 MMC

ORDER DENYING DEFENDANTS’

MOTION TO DETERMINE THAT ABUSE

OF DISCRETION STANDARD OF

REVIEW APPLIES; VACATING

HEARING

Before the Court is the Motion To Determine That Abuse of Discretion Standard of

Review Applies, filed October 13, 2006 by defendants Metropolitan Life Insurance

Company (“MetLife”) and Wells Fargo & Company Long Term Disability Plan (“LTD Plan”). 

Plaintiff Christine Ondersma has filed opposition, to which defendants have replied. Having

considered the papers filed in support of and in opposition to the motion, the Court deems

the matter appropriate for decision on the papers, VACATES the hearing scheduled for

November 17, 2006, and rules as follows.

“Depending upon the language of an ERISA plan, a district court reviews a plan

administrator’s decision to deny benefits either de novo or for abuse of discretion.” Ingram

v. Martin Marietta Long Term Disability Income Plan, 244 F. 3d 1109, 1112 (9th Cir. 2001). 

“The de novo standard is appropriate unless the benefit plan gives the administrator or

Case 3:06-cv-00258-MMC Document 35 Filed 11/16/06 Page 1 of 4
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Defendants have not offered the LTD Plan; instead, defendants offer excerpts from

a document titled “2000 Benefits Book,” which the parties agree is a “Summary Plan

Description” (“SPD”) of several ERISA plans, including the LTD Plan. (See Westheimer Ex.

A at 2-5.) The SPD states the SPD “cannot replace or change any provision of the actual

Plan documents,” and that “[i]f there are any differences between the [SPD] and the Plan

documents, the Plan documents govern [a claimant’s] rights to benefits in all cases.” (See

id.) Because plaintiff has not argued, at least for purposes of the instant motion, that any

portion of the SPD conflicts with the provisions of the LTD Plan, the Court assumes the

SPD accurately summarizes the provisions of the LTD Plan.

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fiduciary discretionary authority to determine eligibility for benefits or to construe the terms

of the plan.” Id. (internal quotation and citation omitted). Such grant of discretionary

authority must be “unambiguous.” See Abatie v. Alta Health & Life Ins. Co., 458 F. 3d 955,

963 (9th Cir. 2006). The administrator bears the burden of showing the plan gives it

discretionary authority. See Ingram, 244 F. 3d at 1112.

Here, the LTD Plan includes specific language granting discretionary authority, and

providing for the delegation of such discretionary authority:

The Plan Administrator has full discretionary authority to administer and

interpret the Plan. The Plan Administrator for the Plans described in this

Benefits Book (except the HMOs) is Wells Fargo & Company, which may

delegate its duties and discretionary authority to accomplish those duties to

certain designated personnel of Wells Fargo & Company, including but not

limited to the Director of Human Resources and the Director of Compensation

and Benefits. Each HMO is the Plan Administrator for that HMO and has the

discretionary authority to administer and interpret benefits under that HMO.

(See Westheimer Ex. A at 2-5.)1

Defendants argue, and plaintiff does not disagree, that the above-quoted language

gives the Plan Administrator discretionary authority. Defendants do not argue, however,

that MetLife, which made the decision to deny benefits, is the Plan Administrator. Further,

defendants do not assert MetLife constitutes “designated personnel” of Wells Fargo &

Company, the only entity to whom, under the above provision, the LTD Plan provides the

Plan Administrator may delegate its discretionary authority. Consequently, in the absence

of another provision, by which the LTD Plan expressly provides MetLife with discretionary

authority, de novo review is applicable herein. See Nelson v. EG & G Energy

Measurements Group, Inc., 37 F. 3d 1384, 1388-89 (9th Cir. 1994) (holding where plan

provided “Administrative Committee” with discretionary authority, and where claim denied

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The reference to “terms used in this chapter” is a reference to Chapter 14 of the

SPD, which chapter is titled “Long Term Disability Plan.”

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by “Pension Administrator,” an entity “involved in the administration of the [p]lan” but not

identified therein as one to which Administrative Committee could delegate its discretionary

authority, denial of benefits was subject to de novo review); cf. Madden v. ITT Long Term

Disability Plan, 914 F. 2d 1279, 1283-84 (9th Cir. 1990) (holding where plan expressly

gives named fiduciary discretionary authority and named fiduciary, acting pursuant to plan

provision allowing for delegation of duties, delegates its discretionary authority to another

fiduciary who denies claim, denial is reviewed for abuse of discretion).

In support of their motion, defendants rely on several additional provisions of the

LTD Plan. The LTD Plan identifies MetLife as the “service provider” of the Plan, (see id.

Ex. A at 2-10), and states that the LTD Plan is “insured and administered by [MetLife],”

(see id. Ex. A at 14-2). The LTD Plan also refers to MetLife as the “claims administrator,”

(see id. Ex. A at 14-3), which the LTD Plan defines as “[a]n organization designated by the

plan administrator to receive, process and administer claims according to plan provisions,

and disburse claim payments and information,” (see id. Ex. A at G-1). Defendants’ reliance

on these provisions is unavailing, because such provisions are indistinguishable, in any

material respect, from claim language the Ninth Circuit has found does not unambiguously

provide for discretionary authority. See Ingram, 244 F. 3d at 1112-13 (holding where plan

stated MetLife “will make all decisions on claims” and that “the management and control of

the operation and administration of claim procedures under the [p]lan, including the review

and payment or denial of claims and the provision of full and fair review of claim denial . . .

shall be vested in [MetLife],” such language did not suffice to unambiguously grant MetLife

“discretionary authority in making those decisions”).

Finally, defendants rely on a provision contained in a subsection titled “The Basics,”

which provision states, “Many of the terms used in this chapter have been specifically

defined for the LTD Plan by MetLife.” (See Westheimer Decl. Ex. A at 14-2.)2 In citing this

provision, defendants appear to argue that, by such language, the Plan Administrator

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delegated to MetLife the authority to interpret some of the terms in the LTD Plan. 

Defendant’s argument is not persuasive. At the outset, the Court notes that the SPD does

not identify which “terms” were defined by MetLife. More importantly, if the above-quoted

provision were interpreted to constitute a delegation of discretionary authority by the Plan

Administrator to MetLife, such delegation would conflict with the one LTD Plan provision

that expressly addresses the matter of to whom the Plan Administrator may delegate its

discretionary authority, and that provision, as noted, identifies “certain designated

personnel of Wells Fargo & Company,” and no others. (See id. Ex. A at 2-5.) Finally, the

provision is, at best, ambiguous with respect to any delegation of discretionary authority to

MetLife, and, to be effective, such delegation must be unambiguous. See Abatie, 458 F.

3d at 963.

In sum, the Court finds defendants have failed to show MetLife has discretionary

authority to interpret the applicable plan.

CONCLUSION

For the reasons stated, defendants’ motion is hereby DENIED, and the denial will be

reviewed de novo.

IT IS SO ORDERED.

Dated: November 16, 2006 

MAXINE M. CHESNEY

United States District Judge

Case 3:06-cv-00258-MMC Document 35 Filed 11/16/06 Page 4 of 4