NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

MARNIE MASUDA-CLEVELAND, ) No. 17-17149 

)

Plaintiff-Appellant, ) D.C. No. 1:16-cv-00057-LEK-RLP

)

) MEMORANDUM*

v. )

)

LIFE INSURANCE COMPANY OF )

NORTH AMERICA, )

)

Defendant-Appellee. )

 )

Appeal from the United States District Court

for the District of Hawaii

Leslie E. Kobayashi, District Judge, Presiding

Submitted April 16, 2019**

San Francisco, California

Before: D.W. NELSON, FERNANDEZ, and BEA, Circuit Judges.

Marnie Masuda-Cleveland appeals the district court’s grant of summary

FILED

MAY 08 2019

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

*This disposition is not appropriate for publication and is not precedent

except as provided by 9th Cir. R. 36-3. 

**The panel unanimously finds this case suitable for decision without oral

argument. Fed. R. App. P. 34(a)(2).
judgment in favor of Life Insurance Company of North America (“LINA”) in her

ERISA1 action to recover benefits under an accident plan (“the Plan”) created by

the employer of her husband, Harlan Masuda, for the benefit of its employees. See

29 U.S.C. § 1132(a)(1)(B). We vacate and remand.

Masuda-Cleveland asserts that the district court erred because it did not give

her an opportunity to submit additional evidence to support her claim for benefits

and because it determined that LINA did not have a substantial conflict of interest

beyond the structural conflict it had as both the Plan administrator and the payor of

benefits under the Plan. We agree.

(1) The Plan provided coverage for death from injuries that were “caused

by an accident” and “from no other causes.” Through most of the administrative

process regarding the benefit claim, LINA essentially agreed that Harlan Masuda’s

death was caused by the injuries he received in the accident, but asserted that a

medical event caused the accident itself.2

 However, in LINA’s ultimate decision,

1Employee Retirement Income Security Act of 1974, Pub. L. No. 93–406,

88 Stat. 829 (codified as amended in scattered sections of 26 & 29 U.S.C.)

(hereinafter, “ERISA”).

2We note that the physician forensic-pathologist who completed an autopsy

was satisfied that his death was, indeed, caused by the accident, although she

speculated that he might have suffered “an acute medical event” that led to the

accident.

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which led to this review, it changed its position and declared that the death was not

caused by the injuries he received in the accident, but was caused by the medical

event itself. In so doing, it relied upon a report from a different physician forensicpathologist that had not been previously disclosed. LINA also refused to consider

any new evidence to rebut the conclusions in that report. Even if all further review

was foreclosed at LINA’s level,

3

 LINA’s new rationale for denying benefits

substantially bolstered its denial position.4 The district court should have allowed

Masuda-Cleveland to submit, and should have considered, rebutting evidence.

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The court’s failure to do so of necessity affected its decision that LINA had no

more than a structural conflict of interest. Thus, the district court erred.

(2) When a district court reviews an administrator’s discretionary

decision regarding a welfare plan pursuant to ERISA, it must decide on the level of

skepticism it should bring to that review, and whether the administrator reached its

decision in a procedurally sound fashion. See Abatie v. Alta Health & Life Ins.

3

See Gabriel v. Alaska Elec. Pension Fund, 773 F.3d 945, 963 (9th Cir.

2014).

4We note that a prior case, where a plan accorded no discretionary authority,

pointed to a possible weakness in LINA’s denial position before the final review. 

See McClure v. Life Ins. Co. of N. Am., 84 F.3d 1129, 1134–36 (9th Cir. 1996) (per

curiam). 

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See Gabriel, 773 F.3d at 964.

3
Co., 458 F.3d 955, 968–69, 971–72 (9th Cir. 2006) (en banc); see also Firestone

Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S. Ct. 948, 957, 103 L. Ed. 2d

80 (1989); Saffon v. Wells Fargo & Co. Long Term Disability Plan, 522 F.3d 863,

872–73 (9th Cir. 2008). The district court recognized that principle, but, in effect, 

determined that the level of the skepticism factor here would be the rather minimal

amount resulting only from LINA’s inherent conflict of interest. We, however, see

the conflict as greater than that. 

In addition to the inherent structural conflict of interest, there are other

indicia that suggest a higher level of skepticism is warranted:

(a) LINA never directly contacted the original physician forensicpathologist who conducted the autopsy. That would have been the most prudent

course and, indeed, was suggested in an internal manual that, at least at one time,

was used by LINA.

(b) LINA obtained a new report after the prior reviews and used that

report to reject the claim on a basis quite different from the previously used basis.

(c) The evidence that the decedent actually had a fatal cardiac event was

weak. 

(3) The above errors leave us to speculate about what decision the district

court would have reached had it factored in a higher level of skepticism and taken

4
more account of LINA’s procedural errors. Thus, we vacate the judgment and

remand to the district court for further proceedings consistent with this

disposition.6

VACATED and REMANDED. Costs are to be taxed against LINA.

6We express no opinion, however, as to the result the district court should

reach on remand. Nor do we purport to opine on the meaning of the Plan’s

requirement that a death be “caused by an accident” and “from no other causes.”

Once the district court has considered Masuda-Cleveland’s outside evidence and

factored heightened skepticism to account for LINA’s structural conflict of interest

and procedural errors into its abuse of discretion analysis, it should reach its own

determination whether the facts of this case result in coverage or lack of coverage

for Masuda-Cleveland. 

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