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Parties Involved:
Janice L. Skinner
Appellant
The Administrative Committee of the W.R. Grace & Co. Long Term Disability Income Plan
Appellee

Document Text:

Fl ·L ~D 

Unitxd States C<!~ <?! Ap~b UNITED STATES COURT OF APPEALS Tent.\ C1rcw, 

FOR THE TENTH CIRCUIT FEBO S 1992 

JANICE L. SKINNER, 

Plaintiff-Appellant, 

v. 

THE ADMINISTRATIVE COMMITTEE OF THE 

W.R. GRACE & CO. LONG TERM DISABILITY 

INCOME PLAN, 

Defendant-Appellee. 

) 

) 

) 

) 

) No. 91-6224 

) (D.C. No. CIV-90-1267-W) 

) (W.D. Okla.) 

) 

) 

) 

) 

ORDER AND JUDGMENT* 

Before LOGAN and BARRETT, Circuit Judges, and KELLY,** District 

Judge. 

**Honorable Patrick F. Kelly, District Judge, United States 

District Court for the District of Kansas, sitting by designation. 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P . 

34(a); 10th Cir. R. 34 . 1.9. 

submitted without oral argument. 

The case is therefore ordered 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 1 
Plaintiff appeals from a district court order granting 

summary judgment in favor of Defendant on Plaintiff' s claim under 

the Employee Retirement Income Security Act (ERISA). The district 

court upheld Defendant's decision to cancel Plaintiff's permanent 

disability benefits under her former employer's Long Term 

Disability Income Plan (Plan). We affirm. 

This court reviews the grant of a motion for summary judgment 

in the light most favorable to the nonmovant . Boren v. 

Southwestern Bell Tel. Co., 933 F.2d 891, 892 (10th Cir. 1991). 

It is the duty of the appellate court "'to examine the record to 

determine if any genuine issue of material fact was in dispute; if 

not, the court must determine if the substantive law was correctly 

applied.'" Id. (quoting Osgood v. State Farm Mut. Auto. Ins. Co., 

848 F.2d 141, 143 (10th Cir. 1988)). Because we conclude that 

Plaintiff has failed to demonstrate a genuine issue of material 

fact,~ Fed . R. Civ. P . 56, we find it unnecessary to address 

Defendant's argument that the district court may resolve issues of 

material fact on summary judgment where the case was set for a 

nonjury trial. 

Plaintiff was a participant in the Plan, pursuant to her 

employment by W.R. Grace & Co. as a line operator from 1977 to 

1981. In 1981, she filed a claim for disability benefits based on 

a degenerative knee condition and an acute back strain. Plaintiff 

qualified for and received disability benefits under the Plan from 

1981 until March of 1990. In February, 1990, Defendant adopted 

the recommendation of the Plan' s claim administrator, Mercer 

2 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 2 
Meidinger Hansen, Inc. (Mercer), that Plaintiff' s disability 

benefits terminate because she was not disabled as defined by the 

Plan. 1 Mercer's recommendation was based on: (1) the denial of 

Plaintiff's application for social security disability income 

because she was capable of sedentary work; (2) the results of a 

vocational assessment of Plaintiff which identified several 

sedentary occupations for which she was qualified; and (3) 

Plaintiff's physician's written opinion that she could perform 

nine sedentary jobs . On February 22, 1990, Mercer notified 

Plaintiff by letter that her benefits would terminate as of 

March 31, 1990. Plaintiff appealed to Defendant; the appeal was 

denied. Plaintiff then filed her complaint in federal court 

1 The Plan pays benefits for a disability defined in Section 

of the Plan documents as follows: 

2 . The term Totally Disabled or Total Disability 

means the complete inability of a Covered Employee to 

engage in any and every duty pertaining to any 

occupation or employment for wage or profit for which 

the Covered Employee is or becomes reasonably qualified 

by training, educati on or experience, except that during 

the Qualifying Disability Period plus the first 

twenty-four months of absence from work due to 

disability thereafter, the Covered Employee shall be 

deemed Totally Disabled while he is unable to perform 

any and every duty pertaining to his occupation and is 

not engaged in any occupation or employment for wage or 

profit. 

3. The Qualifying Disability Period shall be six 

consecutive months of Total Disability. 

3 

Appellee's Supplemental App . at 24. The Plan provides for two 

distinct disabi lity periods: (1) the first thirty months during 

which a covered employee must be unable to perform her job at 

W.R. Grace & Co. , and (2) thereafter, the covered employee must 

be unable to perform any occupation for which she reasonably 

becomes qualified. The latter disability standard applies here . 

3 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 3 
alleging termination of her benefits in violation of ERISA. The 

district court granted summary judgment in favor of Defendant. 

On appeal, Plaintiff first contends that the claims 

procedures of the Plan were inadequate because she did not receive 

notice of the March 1, 1991 decision to terminate benefits. 

Instead, she received only the letter dated February 22, 1990, 

recommending that her benefits terminate. Plaintiff further 

alleges that a question of fact exists as to when the decision was 

made to terminate her disability benefits. She asserts that the 

decision was made March 1, 1990, instead of February 22, 1990, and 

as a result, she did not receive the full sixty days to supply 

additional evidence relative to her appeal, as provided by the 

Plan. 

Claims procedures are set forth in 29 u.s.c. § 11332 and 

29 C.F.R. S 2560.503-l(f). 3 Defendant was required to notify 

2 In accordance with regulations 

employee benefit plan shall -

of the Secretary, every 

(1) provide adequate notice in writing to any participant or 

beneficiary whose claim for benefits under the plan has been 

denied, setting forth the specific reasons for such denial, 

written in a manner calculated to be understood by the 

participant, and 

(2) afford a reasonable opportunity to any participant whose 

claim for benefits has been denied for a full and fair review by 

the appropriate named fiduciary of the decision denying the claim. 

29 u.s.c. § 1133. 

3 Content of notice. A plan administrator or, if paragraph (c) 

of this section is applicable, the insurance company, insurance 

service, or other similar organization, shall provide to every 

claimant who is denied a claim for benefits written notice setting 

forth in a manner calculated to be understood by the claimant: 

(1) The specific reason or reasons for the denial; 

(continued on next page) 

4 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 4 
Plaintiff of its decision to terminate her disability benefits, 

the reasons for doing so, the Plan provisions on which the 

decision was based, any additional information necessary to 

perfect the claim, and how to appeal the decision. 

The uncontroverted evidence is that the decision to terminate 

Plaintiff's benefits was made by Defendant on February 20, 1990. 

Appellee's Supplemental App. at 327, 351. 

1990 letter to Plaintiff informed her: 

Mercer's February 22, 

It has been recommended that your [Plan] benefits 

terminate effective March 31, 1990 because you are not 

totally disabled for any occupation for which you would 

qualify, a requirement for [Plan] benefit eligibility. 

On or about March 31, 1990, you may expect to receive a 

final check for $1,128.00. The check will be sent to 

W.R. Grace & Co. for forwarding to you. 

Appellant's App. at 8. The letter then set forth the Plan's 

definition of "total disability." Plaintiff was also informed of 

the several jobs identified by the vocational rehabilitation 

specialist for which Plaintiff would qualify, and of her 

physician's opinion that she could do any of the listed jobs. 

Lastly, the letter informed Plaintiff of her rights to appeal the 

recommendation to terminate her benefits. Appellant's App. at 

8-8(a). 

(continued from previous page) 

(2) Specific reference to pertinent plan provisions on which 

the denial is based; 

(3) A description of any additional material or information 

necessary for the claimant to perfect the claim and an explanation 

of why such material or information is necessary; and 

(4) Appropriate information as to the steps to be taken if 

the participant or beneficiary wishes to submit his or her claim 

for review. 

5 

(continued on next page) 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 5 
We conclude that the February 22, 1990 notice substantially 

complied with the requirements of§ 2560.503-l(f) and apprised 

Plaintiff that her benefits would cease on March 31, 1990. 

Plaintiff has, therefore, failed to establish a genuine issue of 

material fact in support of her argument that the claims procedure 

employed by Defendant was inadequate . 

Plaintiff next contends that she did not receive a full and 

fair review of Defendant's decision to cancel her disability 

benefits. A reasonable opportunity for the full and fair review 

required by 29 u.s.c. S 1133(2) means '"knowing what evidence the 

decision-maker relied upon, having an opportunity to address the 

accuracy and reliability of the evidence, and having the 

decision-maker consider the evidence presented by both parties 

prior to reaching and rendering his decision.'" Sage v. 

Automation, Inc. Pension Plan & Trust, 845 F.2d 885, 893-94 (10th 

Cir. 1988)(quoting Grossmuller v. International Union, United 

Auto .• Aerospace & Agric . Implement Workers of Am., 715 F.2d 853, 

858 n.5 (3d Cir. 1983)). "The decisions of the plan 

representatives to deny benefits will be upheld unless such 

decisions are '(l) arbitrary and capricious, (2) not supported by 

substantial evidence, or (3) erroneous on a question of law.'" 

Id. at 895 (quoting Peckham v. Board of Trustees of Int'l Bhd. of 

Painters & Allied Trades Union, 653 F.2d 424, 426 (10th Cir. 

1981)). 

(continued from previous page) 

29 C.F.R. § 2560.503-l(f). 

6 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 6 
Here, the Plan provides that "[t]he determination of the 

Administrative Committee as to any disputed question shall be 

conclusive. " Appellee's Supplemental App. at 36. Consequently, 

we conclude that Defendant had the authority and the discretion to 

decide questions of plan interpretation. Therefore, the arbitrary 

and capricious standard of review is applied to Defendant's 

decisions. See Pratt v. Petroleum Prod. Management Inc. Employee 

Sav. Plan & Trust, 920 F.2d 651, 658 (10th Cir. 1990); see also 

Firestone Tire & Rubber Co. v. Bruch, 489 U. S. 101, 115 

(1989)("[A] denial of benefits • 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."). Our review of 

the trial court's legal determinations is plenary. Pratt, 920 

F.2d at 658. 

Plaintiff maintains that she did not receive a full and fair 

review on appeal because: (1) she was requested to supply 

additional evidence from only her doctor, (2) the Plan document 

does not provide for an independent review on appeal since it 

fails to name a fiduciary for review purposes, in violation of 

29 U.S.C. S 1133, and (3) Plaintiff was never informed of the 

evidence on which Defendant relied in denying her appeal. 

The notice that Plaintiff's benefits had been terminated did 

not prohibit the submission of evidence other than that from her 

doctor. Appellant's App. at 8-B(a). Even if it did, Plaintiff 

cites no authority requiring reversal based on the notice 

requesting additional evidence from her doctor only. Plaintiff 

7 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 7 
did not attempt to submit evidence other than her doctor's report, 

and she does not allege the existence of other evidence to 

establish her disability. 

Likewise, her claim that the Plan fails to name a fiduciary 

for review purposes, pursuant to§ 1133(2), is not supported by 

the record. The Plan itself, as well as the Plan summary given to 

the employee, identifies Defendant as the reviewing entity. 

Appellee's Supplemental App. at 36, 341. Furthermore, Plaintiff 

properly filed her appeal with Defendant. Plaintiff cites no 

authority for her argument that because Defendant reviewed its own 

initial decision to terminate her benefits, the decision on appeal 

is necessarily arbitrary and capricious. We decline to adopt such 

a rule. See Brown v. Retirement Comm. of Briggs & Stratton 

Retirement Plan, 797 F.2d 521, 534-35 (7th Cir. 1986)(cornmittee's 

review of its own denial of benefits did not mean that claimant 

was denied a full and fair review), cert. denied, 479 U. S. 1094 

(1987). 

Plaintiff asserts that because she was not informed of Dr. 

William Morris' opinion of her condition, it was improper for 

Defendant to consider it. After the initial decision to terminate 

Plaintiff's benefits, Plaintiff's regular physician, Dr. Cates, 

referred her to orthopedic specialist Dr. Morris. Defendant then 

requested Plaintiff to furnish a report from Dr. Morris "detailing 

his findings and conclusions." Appellee's Supplemental App. at 

329. The documentation provided to Mercer consisted only of Dr. 

Morris' notes, prompting Defendant to telephone Dr. Morris in 

April of 1990 to obtain his professional opinion whether Plaintiff 

8 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 8 
could perform sedentary work. Plaintiff does not allege that she 

could have rebutted the evidence. She alleges no prejudice from 

not having been apprised of Dr. Morris' opinion. Therefore, we 

determine that Defendant's failure to apprise Plaintiff of one 

portion of the evidence, Dr. 

reversal. Cf. Sage, 845 

Morris' report, does not require 

F.2d at 895 (where appellant was not 

prejudiced, reversal not required even where claims procedure was 

deficient). 

Plaintiff also asserts that Defendant's decision to terminate 

her disability benefits was arbitrary and capricious because: 

(1) Defendant incorrectly weighed the opinions of Plaintiff's 

treating physician, and (2) Defendant did not determine that the 

jobs Plaintiff was able to perform would provide her a reasonably 

substantial income. "An administrator's decision is not arbitrary 

or capricious if it is a reasonable interpretation of the plan's 

terms and was made in good faith." Torix v. Ball Corp., 862 F.2d 

1428, 1429 (10th Cir. 1988). 

Defendant based its initial decision to terminate Plaintiff's 

disability benefits in part on Dr. Cates' written opinion dated 

January 16, 1990, that Plaintiff was capable of nine sedentary 

occupations. On February 28, 1990, Dr. Cates submitted another 

written opinion stating that Plaintiff was disabled. Plaintiff 

has failed to demonstrate that Defendant incorrectly weighed the 

two medical opinions submitted by Dr. Cates. 

Plaintiff's argument that Defendant had an affirmative duty 

to ensure that she had sufficient income from the identified 

occupations places the entire burden on Defendant to establish 

9 

Appellate Case: 91-6224 Document: 010110222488 Date Filed: 02/06/1992 Page: 9 
that she was able "to follow [an] occupation from which [she 

could] earn a reasonably substantial income rising to the dignity 

of an income or livelihood. " See id. at 1431. That burden, 

however, is on Plaintiff. Id. Drawing all reasonable inferences 

in Plaintiff's favor, we determine that she has failed to meet her 

burden to establish a genuine issue of material fact to support 

her claim that she is physically unable to perform sedentary jobs 

to earn a reasonable living. 

We reject Plaintiff's final contention that Defendant acted 

arbitrarily and capriciously by making its initial decision to 

deny benefits without the benefit of the evidence presented in the 

administrative appeal. Plaintiff argues that "[t]he evidence was 

not supplied to the committee responsible for the decision until 

April 27, 1990." Appellant's Br. at 16. On the contrary, the 

record reflects that when it issued its initial decision in 

February 1990, Defendant had all of the evidence except Dr. 

Morris' report and Dr. Cates' report dated February 28, 1990. 

Accordingly, Plaintiff has failed to demonstrate the existence of 

a genuine issue of material fact to support her claim that 

Defendant acted arbitrarily and capriciously when it terminated 

her disability benefits. 

The judgment of the United States District Court for the 

Western District of Oklahoma is AFFIRMED. 

Entered for the Court 

James E. Barrett 

Senior Circuit Judge 

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