Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-02148/USCOURTS-caed-2_06-cv-02148-0/pdf.json

Parties Involved:
Barbara Ekno
Plaintiff
Northwestern Mutual Life Insurance Company
Defendant

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IN THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF CALIFORNIA 

BARBARA EKNO, 

 Plaintiff, 

 v. 

NORTHWESTERN MUTUAL LIFE 

INSURANCE COMPANY, 

 Defendant. 

______________________________/

No. Civ. S-06-2148 RRB EFB 

Memorandum of Opinion

and Order

Plaintiff Barbara Ekno (“Ekno”) brought an action against 

Northwestern Mutual Life Insurance Company (“NWML”) seeking 

judicial review of NWML’s denial of long-term disability (“LTD”) 

benefits under her employer’s ERISA-based plan.1

 Ekno now moves 

for summary adjudication. NWML filed a cross-motion for summary 

 

1

 Employee Retirement Income Security Act, 29 U.S.C. § 1001, 

et seq. (“ERISA”). 

 

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judgment. For the reasons stated below, the court DENIES Ekno’s 

motion and GRANTS NWML’s motion.2

I. BACKGROUND 

On February 27, 2003, Ekno began working for the 

WaterEducation Foundation. Administrative Record (“AR”) 245, 

267, attached to Decl. of Denise Lee (“Lee”) (Docket at 22). As 

an employee of the Water Education Foundation, Ekno was a member 

in a LTD plan (“Plan”) insured by NWML. AR 1-31. The Plan 

excludes from coverage a disability “caused or contributed to by 

a Preexisting Condition” for employees, like Ekno, that have 

been members less than twenty-four months. AR 10-11, 23.3 The 

Plan defines preexisting condition as: “a mental or physical 

condition for which [a member has] consulted a Physician Or 

Practioner, received medical treatment or services, or taken 

 

2

 Inasmuch as the Court concludes the parties have submitted 

memoranda thoroughly discussing the law and evidence in support 

of their positions, it further concludes oral argument is 

neither necessary nor warranted with regard to the instant 

matter. See Mahon v. Credit Bureau of Placer County, Inc., 171 

F.3d 1197, 1200 (9th Cir. 1999)(explaining that if the parties 

provided the district court with complete memoranda of the law 

and evidence in support of their positions, ordinarily oral 

argument would not be required). 

3

 The preexisting condition exclusionary time period for 

Ekno was March 5, 2003 to August 31, 2003, the one hundred and 

eighty day period before her insurance benefits became 

effective. Pl.’s Undisputed Material Facts ¶¶ 12, 50; AR 25-26. 

As such, Ekno did not become a “member” under the Plan until 

September 1, 2003. AR 267. 

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prescribed drugs or medication at any time during the 

Preexisting Condition period . . .” AR 10. 

On September 30, 2004, Ekno stopped working for the Water 

Education Foundation. AR 245. On April 4, 2005, Ekno submitted 

an Employee Statement regarding her illness/disability. AR 240-

43. In her Employee Statement, Ekno stated that she was unable 

to work because she could not, among other things, obtain 

restful sleep, concentrate for more than fifteen minutes, read 

for more than ten minutes, control mood, stay on task, or be 

around others. AR 243.4

 On April 19, 2005, Ekno’s employer 

completed an Employer Statement for NWML. AR 244-245. On or 

about April 27, 2005, Ekno’s treating physician, Jody Gordon, 

M.D., completed an Attending Physician Statement for NWML, 

determining that Ekno ceased work due to symptoms from the 

following medical conditions: prolactinoma,5

 major depression, 

 

4

 Ekno also stated that she was taking the following 

medications: (1) Levoxly (used to treat hypothyroidism); (2) 

Effexor (anti-depressant); (3) Alprazolam (used to treat anxiety 

and panic attacks); (4) Spironolactone (used to treat, among 

other things, hypertension); and (5) Bromocriptine (used to 

treat, among other things, amenorrhea). AR 243. Finally, Ekno 

stated that she first noticed her symptoms in the fall of 2004 

and is currently unaware as to what precisely is causing her 

condition since she is still in the diagnostic phase. AR 243. 

5

 Prolactinoma “is a benign tumor of the pituitary gland 

that produces a hormone called prolactin. It is the most common 

type of pituitary tumor. Symptoms of prolactinoma are caused by 

too much prolactin in the blood (hyperprolactinemia) or by 

pressure of the tumor on surrounding tissues. Prolactin 

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and hypothyroidism. AR 210-11. Dr. Gordon noted that Ekno’s 

symptoms were refractory severe depression with panic attacks, 

amenorrhea, hirsituism, HTN, acne and severe fatigue. AR 211. 

Dr. Gordon concluded that Ekno was unable to return to work due 

to sever emotional instability and depression, panic attacks, 

loss of memory and ability to concentrate. AR 211. Dr. 

Gordon’s planned course of treatment included: an endocrinology 

referral, bromocriptine, serial MRI, anti-depressants and 

anxiolytics. AR 211. Dr. Gordon’s prognosis was that she 

anticipated Ekno’s depression to improve and the antidepressants to be more effective once her prolactin levels 

normalized. AR 210. 

 In a letter dated June 1, 2005, NWML, through Ms. Lee, 

denied Ekno’s claim for LTD benefits on the basis that Ekno was 

treated for depression during the preexisting condition 

exclusionary time period by Careen Whitley, M.D., on June 2, 

 

stimulates the breast to produce milk during pregnancy. After 

delivery of the baby, a mother’s prolactin levels fall unless 

she breast feeds her infant. Each time the baby nurses, 

prolactin levels rise to maintain milk production. . . . In 

women, high blood levels of prolactin often cause infertility 

and changes in menstruation. In some women, periods may become 

irregular or menstrual flow may change. Women who are not 

pregnant or nursing may begin producing breast milk. Some women 

may experience a loss of libido (interest in sex). Intercourse 

may become painful because of vaginal dryness.” AR 319-20. 

 

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2003.6 AR 329-31. This letter expressly invited Ekno to submit 

additional medical information demonstrating that she “became 

disabled for a non-excluded condition” and promised that her 

claim would be reviewed “by an individual who was not involved 

with the original decision” to deny her claim. AR 329-31. In a 

letter dated July 7, 2005, Ms. Lee, again, denied Ekno’s claim, 

despite Ekno’s submission of additional medical information 

allegedly showing that she suffered from a disabling, nonpreexisting condition. AR 348-351.7

 In accordance with the 

Plan’s review procedures, Ekno appealed the denial of her claim 

to NWML’s Quality Assurance Unit. AR 475-479. Following a 

review of Ekno’s file by NWML’s vocational consultant, 

Dr. Bradley Fancher (“Fancher”), NWML’s Quality Assurance Unit 

 

6

 On June 6, 2003, Dr. Whitely saw Ekno for obesity, 

depression, reactive airway disease and menstrual irregularities 

(noting that polycystic ovarian syndrome needed to be ruled 

out). AR 231. During this visit, Dr. Whitley noted in Ekno’s 

medical chart that she “sees a psychiatrist for chronic 

depression and stable on Celexa and Xanax.” AR 231. 

Dr. Whitley also requested “labs with LH/PSH, prolactin, DHEA 

test, thyroid panel and serum testosterone.” AR 231. 

7

 In the June 7, 2005 letter, Ms. Lee acknowledged that Ekno 

might be suffering from the non-preexisting disabling condition 

of prolactinoma but that she was not entitled to LTD benefits 

because this condition did not become disabling until after Ekno 

was no longer a member of the Plan. AR 348-51. Because NWML 

ultimately denied LTD benefits on the independent basis that 

Ekno’s disability was due to chronic depressive disorder, and 

not prolactimona or an elevated prolactic level (AR 476), the 

court need not address the propriety of NWML’s determination 

that Ekno was a not member of the Plan at the time she was 

diagnosed with prolactinoma. 

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affirmed the denial of Ekno’s claim on the basis that her 

disability was caused or contributed to by depression, a 

condition in which she was treated and took prescription 

medication for during the preexisting condition exclusionary 

period. AR 475-79. 

 On September 28, 2006, Ekno brought the instant action 

seeking recovery of wrongfully denied LTD benefits under ERISA, 

29 U.S.C. § 1132. Docket at 1. On February 5, 2008, Ekno filed 

a motion for summary adjudication seeking a determination that 

judicial review of NWML’s denial of LTD benefits is de novo. 

Docket at 13. NWML filed a cross-motion seeking summary 

judgment on the basis that LTD benefits were properly denied 

because Ekno’s disability was caused or contributed to by 

depression, a condition in which she was treated and took 

prescription medication for during the preexisting condition 

exclusionary time period. Docket at 20. 

II. DISCUSSION 

A. Legal Standards 

1. Rule 56(c) 

Summary judgment/adjudication is appropriate where “there 

is no genuine issue as to any material fact” and “the moving 

party is entitled to a judgment as a matter of law.” 

Fed.R.Civ.P. 56(c). The moving party has the initial burden of 

identifying relevant portions of the record that demonstrate the 

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absence of a fact or facts necessary for one or more essential 

elements of each cause of action upon which the moving party 

seeks judgment. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 

(1986). If the moving party has sustained its burden, the 

nonmoving party must then identify specific facts, drawn from 

materials on file, that demonstrate that there is a dispute as 

to material facts on the elements that the moving party has 

contested. See Fed. R. Civ. P. 56(c). In deciding whether the 

moving party is entitled to judgment as a matter of law, the 

court must consider the facts presented by the nonmoving party 

along with any undisputed facts. See T.W. Elec. Serv., Inc. v. 

Pacific Elec. Contractors Ass’n, 809 F.2d 626, 631, n.3 (9th 

Cir. 1987). In order to survive a motion for summary 

judgment/adjudication, the nonmoving party must present enough 

evidence for a reasonable jury to return a verdict in his or her 

favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 

(1986). 

On a motion for summary judgment/adjudication, all 

reasonable doubt as to the existence of a genuine issue of fact 

should be resolved against the moving party. Hector v. Wiens, 

533 F.2d 429, 432 (9th Cir. 1976). The inferences drawn from 

the underlying facts must be viewed in the light most favorable 

to the party opposing the motion. Valadingham v. Bojorquez, 866 

F.2d 1135, 1137 (9th Cir. 1989). Where different ultimate 

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inferences may be drawn, summary judgment is inappropriate. 

Sankovich v. Insurance Co. of North America, 638 F.2d 136, 140 

(9th Cir. 1981). The purpose of summary judgment/adjudication 

is to “pierce the pleadings and assess the proof in order to see 

whether there is a genuine need for trial.” Matsushita Elec. 

Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). 

Thus, “[w]here the record taken as a whole could not lead a 

rational trier of fact to find for the non-moving party, there 

is no ‘genuine issue for trial.’” Id. 

2. Standard of Review: ERISA Denial of Benefits Case 

 Although NWML has filed a cross-motion for summary judgment 

under Rule 56(c), in an ERISA benefits case, the “traditional” 

summary judgment standards are not necessarily appropriate where 

the court is asked to review an ERISA plan administrator’s 

decision. Bendixen v. Standard Ins. Co., 185 F.3d 939, 942 (9th 

Cir. 1999). In an ERISA action, where the plaintiff is 

challenging the plan administrator’s denial of benefits, if the 

district court determines that the administrator’s decision is 

reviewed for abuse of discretion, “a motion for summary judgment 

is merely the conduit to bring the legal question before the 

district court and the usual tests of summary judgment, such as 

whether a genuine dispute of material fact exists, do not 

apply.” Id. at 942 (finding that “[a]lthough there may be 

contradictory evidence in the record, we hold that, as a matter 

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of law, the plan administrator did not abuse its discretion”). 

Thus, a summary judgment motion resting on the administrative 

record is not a typical summary judgment, but rather, is a 

procedural vehicle for determining whether benefits were 

properly granted or denied. Accordingly, the threshold question 

is whether judicial review of NWML’s denial of LTD benefits is 

de novo or abuse of discretion. 

B. Applicable Standard of Review 

 Ekno advances two arguments in support of her contention 

that NWML’s denial of her claim for LTD benefits is subject to 

de novo review: (1) NWML’s Plan does not confer discretionary 

authority on NWML to construe and interpret the Plan and to make 

final benefit determinations; and/or (2) the provisions in 

NWML’s Plan purporting to grant discretionary authority on NWML 

are unlawful and unenforceable. Alternatively, Ekno argues that 

if the court determines that de novo review is not the proper 

standard of review, then it should afford little deference to 

NWML’s decision to deny LTD benefits because NWML operated under 

a conflict of interest. 

 ERISA provides for judicial review of a decision to deny 

benefits to an ERISA plan beneficiary. See 29 U.S.C. 

§ 1132(a)(1)(B). It also creates federal court jurisdiction to 

hear such a claim. See 29 U.S.C. § 1132(e). ERISA, however, 

does not specify what legal standard the court should apply when 

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reviewing a decision to deny benefits to an ERISA plan 

beneficiary. See Firestone Tire & Rubber v. Bruch, 489 U.S. 

101, 109 (1989). In determining the standard of review in an 

ERISA denial of benefits case, the starting point is the wording 

of the plan. Abatie v. Alta Health & Life Ins. Co., 458 F.3d 

955, 962-63 (9th Cir. 2006) (en banc). “When a plan does not 

confer discretion on the administrator ‘to determine eligibility 

for benefits or to construe the terms of the plan,’ a court must 

review the denial of benefits de novo ‘regardless of whether the 

plan at issue is funded or unfunded and regardless of whether 

the administrator or fiduciary is operating under a possible or 

actual conflict of interest.’ De novo is the default standard 

of review.” Id. at 963 (citation omitted). If de novo review 

applies, the court must simply evaluate whether the plan 

administrator correctly or incorrectly denied benefits, without 

reference to whether the administrator operated under a conflict 

of interest. Id. However, “if the plan does confer 

discretionary authority as a matter of contractual agreement, 

then the standard of review shifts to abuse of discretion.” 

Id. (emphasis in original). Under Ninth Circuit precedent, “for 

a plan to alter the standard of review from the default of de 

novo to the more lenient abuse of discretion, the plan must 

unambiguously provide discretion to the administrator.” Id. 

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 The relevant section of the Plan at issue here, entitled 

“Allocation of Authority,” provides: “Except for those functions 

which the Policy and the Summary Of Insurance Benefits 

specifically reserve to the Policyowner or Employer, the Company 

has full and exclusive authority to control and manage the 

Policy and Summary Of Insurance Benefits, to administer claims, 

and to interpret the Policy and the Summary Of Insurance 

Benefits and resolve all questions arising in the 

administration, interpretation, and application of the Policy 

and Summary of Insurance Benefits.” AR 6. This section further 

provides: “The Company’s authority includes, but is not limited 

to: The right to resolve all matters when a review has been 

requested; The right to establish and enforce rules and 

procedures for the administration of the Policy and the Summary 

of Insurance Benefits and any claim under them; The right to 

determine: (1) Your eligibility for insurance; (2) Your 

entitlement to benefits; (3) The amount of benefits payable to 

you; (4) The sufficiency and the amount of information the 

Company may reasonably require to determine 1, 2, or 3 above.” 

AR 6. Finally, this section provides: “Subject to the review 

procedures of the policy and the Summary of Insurance Benefits, 

any decision the Company makes in the exercise of the Company’s 

authority is conclusive and binding.” AR 5. 

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 Based on the foregoing provisions, the court concludes that 

the proper standard of review in this case is abuse of 

discretion because the Plan confers discretionary authority on 

NWML to construe and interpret the Plan and to make final 

benefit determinations. See Abatie, 458 F.3d at 963-64 (review 

of the denial of benefits is abuse of discretion if a plan 

grants the power to construe and interpret the plan and to make 

final benefit determinations); see also Bendixen, 185 F.3d at 

943 (finding nearly identical policy language sufficient to 

confer discretion on insurer to warrant application of abuse of 

discretion standard of review); Lawless v. Northwestern Mut. 

Life Ins. Co., 360 F. Supp. 2d 1046, 1054 (N.D. Cal. 2005) 

(same). The court, however, is mindful that where, as here, a 

plan administrator both administers a plan and funds it, an 

inherent or structural conflict of interest exists, and the 

court must weigh the conflict as a factor in determining how 

much or how little to credit the plan administrator’s reason for 

denying insurance coverage. See Abatie, 458 F.3d at 965-69. A 

court weighs such a conflict more or less “heavily” depending on 

what other evidence is available. Id. at 968. A conflicted 

administrator’s decision is viewed with a low level of 

skepticism if the structural conflict of interest is 

unaccompanied by a lack of evidence of malice, self-dealing, or 

of a parsimonious claims-granting history. Id. But such a 

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conflict is weighed more heavily if the administrator provides 

inconsistent reasons for denial, fails adequately to investigate 

a claim or ask the plaintiff for necessary evidence, fails to 

credit a claimant’s reliable evidence, or has repeatedly denied 

benefits to deserving participants by interpreting plan terms 

incorrectly or by making decisions against the weight of 

evidence in the record. Id. at 968-69.8 When reviewing a 

discretionary denial of benefits by a plan administrator who is 

subject to a conflict of interest, the court must determine the 

extent to which the conflict influenced the administrator’s 

decision and discount to that extent the deference accorded to 

the administrator’s decision. Saffon v. Wells Fargo & Co. Long 

Term Disability Plan, 511 F.3d 1206, 1212 (9th Cir. 2008). In 

weighing a conflict of interest the court “is making something 

akin to a credibility determination about the insurance 

company’s or plan administrator’s reason for denying coverage 

 

8

 In deciding how much weight to give a conflict of interest 

under the abuse of discretion standard, the court may consider 

evidence outside the administrative record that was before the 

plan administrator to determine whether a conflict of interest 

exists that would affect the appropriate level of judicial 

scrutiny. Abatie, 458 F.3d at 970 (a district court, in its 

discretion, may consider evidence outside the administrative 

record to decide the nature, extent, and effect on the decisionmaking process of any conflict of interest; the decision on the 

merits, though, must rest on the administrative record once the 

conflict (if any) has been established, by extrinsic evidence or 

otherwise). 

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under a particular plan and a particular set of medical and 

other records.” Id.

 Next, because Ekno contends that NWML violated ERISA’s 

procedural requirements as well as the Plan’s claims handling 

procedures, the court turns to whether such violations justify 

de novo review of the administrator’s decision. In Abatie, the 

court clarified the standard of review district courts should 

apply when administrators fail to follow procedural requirements 

of ERISA. Abatie, 458 F.3d at 971. There, the court stated 

that a decision by an administrator to deny benefits under a 

plan will be reviewed de novo when “an administrator engages in 

wholesale and flagrant violations of the procedural requirements 

of ERISA, and thus acts in utter disregard of the underlying 

purpose of the plan.” Id. at 981. For instance, de novo review 

is appropriate where an administrator keeps the policy details 

secret from the employees, offers the employees no claims 

procedure, and does not provide the employees in writing the 

relevant plan information. Id. at 971. Finally, the Abatie

decision clarified the standard of review to apply when there is 

evidence of procedural irregularities that cannot be 

characterized as wholesale and flagrant violations of ERISA 

procedural requirements. Id. at 972. In this regard, the court 

explained that: “A procedural irregularity, like a conflict of 

interest, is a matter to be weighed in deciding whether an 

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administrator’s decision was an abuse of discretion . . . When 

an administrator can show that it has engaged in an ‘ongoing, 

good faith exchange of information between the administrator and 

the claimant,’ the court should give the administrator’s 

decision broad deference notwithstanding a minor irregularity 

. . . A more serious procedural irregularity may weigh more 

heavily. Id. at 972. If procedural irregularities, even minor 

ones, have prevented full development of the record, the court 

may take additional evidence to, in essence, recreate the 

administrative record to reflect what the record should have 

been absent the irregularities. Id.

In this case, Ekno advances two reasons why a heightened 

standard of review is warranted: (1) NWML violated the Plan’s 

claims handling procedures; and (2) NWML violated ERISA’s 

procedural requirements by failing to fully and properly 

investigate her claim. Reviewing the record, however, the court 

cannot conclude that the administrator engaged in “wholesale and 

flagrant violations” of ERISA’s procedural requirements or the 

Plan’s claims handling procedures, to warrant de novo review. 

First, Ekno presented no compelling evidence or argument 

demonstrating that NWML engaged in wholesale or flagrant 

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violations of the Plan’s claims handling procedures.9 Second, 

while Ekno contends that NWML violated ERISA’s procedural 

requirements by ceasing to investigate her claim once it 

discovered that she was treated and prescribed medication for 

depression during the preexisting condition exclusionary time 

period,10 the record contains evidence supporting NWML’s decision 

to deny LTD benefits on this basis. AR 231. Additionally, the 

record indicates that Ekno was provided an opportunity to seek 

review of this decision and to submit additional medical 

evidence supporting her contention that she was disabled due to 

the non-preexisting condition of prolactinoma. In this regard, 

the record indicates that Ekno submitted additional medical 

evidence, which was forwarded to NWML’s Quality Assurance Unit 

and reviewed by NWML’s consulting physician (Dr. Fancher) in 

 

9

 The record does not contain evidence indicating that NWML 

kept policy details secret from Ekno, offered her no claims 

procedure, or failed to provide relevant Plan information in 

writing. Rather, the record indicates that NWML provided Ekno 

with the relevant provisions of the Plan upon which it relied to 

deny LTD benefits as well as an explanation supporting this 

decision. The record further indicates that NWML provided Ekno 

an opportunity to seek review of its decision and to submit 

additional medical information supporting her contention that 

her disability was caused by the non-preexisting condition of 

prolactinoma. 

10 In this regard, Ekno claims that NWML ceased 

investigating her claim even though it knew that Ekno had been 

diagnosed with the disabling non-preexisting condition of 

prolactinoma and had no evidence from a psychiatrist regarding 

her condition. 

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conjunction with other medical records before NWML rendered a 

final decision regarding Ekno’s entitlement to LTD benefits. 

Accordingly, the record does not support Ekno’s contention that 

NWML failed to fully investigate Ekno’s medical condition before 

denying her claim for LTD benefits.11 

To the extent that Ekno asserts that NWML did not perform a 

full investigation and independent review of her claim because 

NWML’s consulting physician, Dr. Fancher, operated under a 

conflict of interest due to his close relationship with NWML 

and/or Standard Insurance Company, the court rejects this 

assertion. Ekno failed to point to any evidence, beyond the 

mere fact of an apparent conflict, demonstrating a serious 

conflict of interest that would support a finding that Dr. 

 

11 To the extent that Ekno argues that NWML violated the 

claims handling procedures of the Plan by failing to have a 

psychiatric consultant review her medical records (i.e., conduct 

an independent medical examination (“IME”)), the court rejects 

this argument. Although Dr. Fancher recommended that it might 

be appropriate to have Ekno’s claim reviewed by a psychiatric 

consultant, the Plan does not require NWML to have a psychiatric 

consultant independently review the claim of a member alleging a 

disability caused by a mental disorder. Moreover, Ekno does not 

cite, and this court could not find, binding case authority 

indicating that the failure to do an IME creates a conflict of 

interest. See Fought v. Unum Life Ins. Co. Of America, 379 F.3d 

997, 1015 (10th Cir. 2004) (where a conflict of interest may 

impede an ERISA plan administrator’s impartiality, the 

administrator best promotes the purposes of ERISA by obtaining 

an independent evaluation. However, such an IME is not 

required.). Nonetheless, the court finds that NWML’s failure to 

conduct an IME is a circumstance that must be considered when 

determining whether NWML abused its discretion. 

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Fancher failed to provide an independent review of her claim.12 

Therefore, because there is no evidence before the court of a 

serious conflict of interest, nor is there evidence of a 

wholesale or flagrant violation of ERISA’s procedural 

requirements or the Plan’s claims handling procedures, the court 

concludes that de novo review of NWML’s decision to deny LTD 

benefits is improper. See Abatie, 458 F.3d at 971 (observing 

that procedural irregularities must be substantial, i.e., 

wholesale and flagrant violations, in order to alter the 

standard of review). Thus, abuse of discretion remains the 

appropriate standard of review. However, because a structural 

conflict of interest exists, the court will apply an abuse of 

discretion standard of review with slightly greater scrutiny.13 

 

12 “In order to establish a serious conflict, the 

beneficiary has the burden to come forward with ‘material, 

probative evidence, beyond the mere fact of the apparent 

conflict, tending to show that the fiduciary’s self-interest 

caused a breach of the administrator’s fiduciary obligations to 

the beneficiary.’ If the beneficiary cannot satisfy this 

burden, the district court should apply the traditional abuse of 

discretion review.” Bendixen, 185 F.3d at 943 (citation 

omitted). There is no evidence before the court demonstrating 

that Dr. Fancher had any financial, or other, incentive to 

render an opinion adverse to Ekno. 

13 To the extent that Ekno argues that she is entitled to de 

novo review because the discretionary clause in NWML’s Plan is 

unlawful and/or unenforceable pursuant to California Insurance 

Code § 10291, the court disagrees. Because Ekno’s contract was 

in existence before the California Insurance Commissioner 

prohibited insurance companies from using discretionary clauses 

in insurance contracts, the discretionary clause at issue here 

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C. NWML’s Denial of LTD Benefits 

 Applying the abuse of discretion standard of review, the 

sole issue before the court is whether NWML abused its 

discretion, or in other words, acted arbitrarily and 

capriciously, in denying Ekno’s claim for LTD benefits. 

When a court reviews the decision of a plan administrator 

for abuse of discretion, it cannot substitute its judgment for 

the administrator’s, and therefore it can set aside the 

administrator’s discretionary determination only when it is 

arbitrary and capricious. Jordan v. Northrop Grumman Corp. 

Welfare Benefit Plan, 370 F.3d 869, 875 (9th Cir. 2004). A 

decision “grounded on any reasonable basis” is not considered 

arbitrary or capricious. Id. (internal quotation marks omitted 

and emphasis in original). Under the abuse of discretion 

standard, the issue before the court is not the Plan 

administrator reached the “correct” decision; but rather, 

whether there is substantial evidence in the record to support 

the decision. Snow v. Standard Ins. Co., 87 F.3d 327, 331-32 

(9th Cir. 1996) (abuse of discretion standard does not permit 

overturning a decision where there is “substantial evidence” to 

 

is not unlawful and/or unenforceable. See Saffon, 511 F.3d at 

1211 (observing that, even assuming that the California 

Insurance Commissioner may prohibit insurance companies from 

using a discretionary clause in future insurance contracts, he 

cannot rewrite existing contracts so as to change the rights and 

duties thereunder). 

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support the decision--that is, where there is relevant evidence 

that reasonable minds might accept as adequate to support 

conclusion even if it is possible to draw two inconsistent 

conclusions from evidence), overruled on other grounds, Kearny 

v. Standard Ins. Co., 175 F.3d 1084 (9th Cir. 1999). Even 

decisions directly contrary to evidence in the record may not 

necessarily amount to an abuse of discretion. Taft v. Equitable 

Life Assur. Soc’y, 9 F.3d 1469, 1473 (9th Cir. 1993). 

“An ERISA administrator abuses its discretion only if it 

(1) renders a decision without explanation, (2) construes 

provisions of the plan in a way that conflicts with the plain 

language of the plan, or (3) relies on clearly erroneous 

findings of fact.” Boyd v. Bert Bell/Pete Rozelle NFL Players 

Retirement Plan, 410 F.3d 1173, 1178 (9th Cir. 2005) (citation 

omitted). A finding is clearly erroneous when although there is 

evidence to support it, the reviewing court, after considering 

all the evidence, is left with the definite and firm conviction 

that a mistake has been committed. Id. The decision of an 

ERISA plan administrator will be upheld “‘if it is based upon a 

reasonable interpretation of the plan’s terms and was made in 

good faith.’” Id. 

 In the present case, Ekno maintains that NWML abused its 

discretion in denying LTD benefits on the basis that her 

disability was caused by a preexisting condition of depression 

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for which she was treated and took medication for during the 

preexisting condition exclusionary time period. In this regard, 

Ekno argues that, although her medical records contain 

references that she was seeing a psychiatrist and receiving 

medications for depression during the preexisting exclusionary 

period, NWML nonetheless abused its discretion in denying LTD 

benefits because the record does not contain evidence 

demonstrating that she actually received treatment from a 

psychiatrist or took medication for depression during the 

preexisting condition exclusionary time period. The court 

disagrees. The record contains substantial evidence 

demonstrating that Ekno currently suffers from severe depression 

and was treated and took prescription medicine for depression 

during the preexisting condition exclusionary time period. AR 

231. The record also contains evidence, based on a medical 

evaluation by a psychiatrist, demonstrating that Ekno has a long 

history of recurrent depression that began when she was twentynine (approximately ten years before she stopped working for the 

Water Education Foundation), and has been prescribed various 

anti-depressants over that span to treat bouts of depression 

that occur approximately twice-a-year. AR 195. Finally, while 

there is evidence in the record indicating that Ekno also 

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suffers from the non-preexisting condition of prolactinoma,14 the 

record contains substantial evidence supporting NWML’s 

conclusion that Ekno’s disability was caused or contributed to 

by depression. AR 195, 205-08, 222-23, 231, 417-20, 425, 431, 

433.15

 Accordingly, based on careful review of the record with 

heightened scrutiny, the court concludes that NWML did not abuse 

its discretion in denying LTD benefits. The decision was not 

rendered without explanation, nor did Ekno demonstrate that NWML 

 

14 Dr. Gordon concluded that Ekno’s disability is the result 

of a combination of her hyperprolactinemia, severe depression 

and anxiety and medication side-effects. AR 444. 

15 Although Ekno’s treating physician determined that her 

disability is the result of a combination of hyperprolactinemia, 

severe depression and anxiety and medication side-effects, this 

determination does not make NWML’s decision to deny LTD benefits 

arbitrary or capricious. See Black & Decker Disability Plan v. 

Nord, 538 U.S. 822, 834 (2003) (holding that courts have no 

warrant to require administrators automatically to accord 

special weight to the opinions of a claimant’s physician; nor 

may courts impose on plan administrators a discrete burden of 

explanation when they credit reliable evidence that conflicts 

with a treating physician’s evaluation). In this case, NWML’s 

decision was supported by specific reasons and based on reliable 

evidence in the record, i.e., grounded on a reasonable basis. 

Moreover, Ekno has not identified a clearly erroneous finding of 

fact, nor has she shown that NWML arbitrarily refused to credit 

reliable evidence. See Jordan, 370 F.3d at 879 (holding plan 

administrator, in accepting opinion of “reviewing physician” 

over opinion of plaintiff’s treating physicians, did not abuse 

discretion, where reviewing physician’s report included “serious 

reasons for his conclusions, and allowed for a reasonable 

independent judgment by [the plan administrator] in reliance on 

it”). Indeed, the opinion of Ekno’s treating physician does not 

contradict or undermine NWML’s determination that Ekno’s 

disability was caused or contributed to by depression.

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construed provisions of the Plan in a way that conflicted with 

the plain language of the Plan. Nor did Ekno demonstrate that 

NWML relied on clearly erroneous findings of fact, or 

arbitrarily refused to credit reliable evidence, or made its 

decision without a reasonable factual basis. As such, the court 

upholds NWML’s decision to deny Ekno’s claim for LTD benefits. 

III. CONCLUSION 

 For the reasons stated above, the court DENIES Ekno’s 

motion for summary adjudication and GRANTS NWML’s motion for 

summary judgment. 

IT IS SO ORDERED. 

ENTERED this 19th day of March, 2008. 

s/RALPH R. BEISTLINE 

 United States District Judge 

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