IN THE UNITED STATES DISTRICT COURT FOR THE 

MIDDLE DISTRICT OF ALABAMA 

NORTHERN DIVISION 

OWEN J. ROGAL, D.D.S., P.C., 

 Plaintiff, 

v. 

SKILSTAF, INC., 

 Defendant. 

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CIVIL ACTION NO. 

3:06-cv-00711-MHT 

DEFENDANT’S REPLY TO PLAINTIFF’S OPPOSITION 

TO DEFENDANT’S MOTION FOR SUMMARY JUDGMENT

Defendant Skilstaf, Inc. (“Skilstaf”) hereby submits this reply to Plaintiff’s 

Reply in Opposition to Defendant’s Motion for Summary Judgment.1

 This reply 

addresses two issues: (1) which standard of review applies in this case; and (2) 

whether charges incurred in connection with Plaintiff’s treatment of Dennis 

Berry’s work-related injury are covered under the terms of the Skilstaf Group 

Health Plan (the “Plan”). 

 

1

 For ease of reference, Plaintiff’s Reply in Opposition to Defendant Skilstaf, Inc.’s Motion for 

Summary Judgment will be referred to herein as “Plaintiff’s Opposition” while Plaintiff’s Brief 

in Opposition to Defendant Skilstaf, Inc.’s Motion for Summary Judgment will be referred to 

herein as “Plaintiff’s Brief.” 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 1 of 9
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I. THERE IS NO CONFLICT OF INTEREST BECAUSE THE PLAN 

ADMINISTRATOR RESPONSIBLE FOR MAKING 

DISCRETIONARY DECISIONS DOES NOT PAY CLAIMS 

UNDER THE PLAN. 

In the Eleventh Circuit, a conflict of interest exists, such that the heightened 

arbitrary and capricious standard of review applies, where the plan administrator 

responsible for making discretionary benefits or coverage decisions is also 

responsible for paying claims under the plan. See, e.g., Brown v. Blue Cross &

Blue Shield of Ala., Inc., 898 F.2d 1556, 1562 (11th Cir. 1990) (noting that a 

“‘conflict of interest [exists] when the fiduciary making a discretionary decision is 

also the insurance company responsible for paying the claims’”) (quoting Jader v. 

Principal Mut. Life Ins. Co., 723 F. Supp. 1338, 1343 (D. Minn. 1989)). In its 

Brief, Plaintiff incorrectly suggests that the heightened arbitrary and capricious 

standard of review is applicable in this case because “the plan affords the 

administrator discretion and the administrator has a conflict of interest . . . .” 

(Plaintiff’s Brief at 4, ¶ 3). Plaintiff’s suggestion notwithstanding, the Plan 

Administrator (Risk Reduction, Inc. (“RRI”)) responsible for making discretionary 

decisions under the Plan is not responsible for funding the Plan. See Skilstaf00058, Skilstaf-00060.2

 Accordingly, and because there is no conflict of interest, 

 

2

 Excerpts from the Administrative Record were attached as Exhibits A and B to the Affidavit of 

Robert Johnson, which was submitted contemporaneously with Skilstaf’s Motion for Summary 

Judgment. For ease of reference, pages within each respective exhibit will be referred to in this 

reply brief by their bates-labeled page numbers only, such as “Skilstaf-00125.” 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 2 of 9
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the more deferential arbitrary and capricious standard of review is applicable in 

this case. HCA Health Servs. of Ga., Inc. v. Employers Health Ins. Co., 240 F.3d 

982, 994 (11th Cir. 2001) (“If no conflict of interest exists, then only arbitrary and 

capricious review applies and the claims administrator’s wrong but reasonable 

decision will not be found arbitrary and capricious.”). 

As the Plan’s SPD makes clear, RRI is the Plan Administrator; Skilstaf, by 

contrast, is the Plan Sponsor. Skilstaf-00060. As the Plan Administrator, RRI is 

vested with full discretionary power to interpret the Plan, to determine all inquiries 

arising in the Plan’s administration, application, and interpretation, and to apply 

the Plan’s claim review procedures. Skilstaf-00058, Skilstaf-00060. Skilstaf, by 

contrast, is responsible for making “contributions to the plan” based “upon its 

determination of the amounts necessary to timely pay benefits and expenses . . . .” 

Skilstaf-00060. Because Skilstaf funds the Plan and RRI, who is responsible for 

making discretionary decisions under the Plan, does not, there is no conflict of 

interest and the deferential arbitrary and capricious standard of review applies in 

this case. HCA Health Services of Georgia, Inc., 240 F.3d at 994; see also

Brown, 898 F.2d at 1562. 

II. PLAINTIFF’S TREATMENT OF DENNIS BERRY’S WORKRELATED INJURY IS NOT COVERED UNDER THE PLAN 

The Plan’s SPD makes absolutely clear that “[c]harges for injury or sickness 

occurring during or arising from your performance of service in a covered business 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 3 of 9
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or industry” are not payable under the Plan. Skilstaf-00039, Skilstaf-00040. 

Plaintiff concedes that it treated Dennis Berry for “symptomology . . . he sustained 

in a work-place incident [on] September 26, 2003.” (Plaintiff’s Opposition at ¶ 8). 

Because Plaintiff treated Dennis Berry in connection with a work-related injury, 

Skilstaf correctly determined that Plaintiff’s Dennis Berry-related claims were 

excluded from coverage under the Plan. 

Plaintiff’s contention that its Dennis Berry-related claims are covered under 

the Plan because said claims were denied by Mr. Berry’s workers’ compensation 

carrier, CSC Claim Company (“CSC”), is mistaken. (See Plaintiff’s Brief at 9 

(arguing that “paragraph 16 under section 9 of the plan indicates that treatment 

rendered in connection with a workers’ compensation injury must be payable in 

order for said [exclusionary] section to be applicable”)). Contrary to Plaintiff’s 

contention, the Plan’s SPD makes clear that “[c]harges for injury or sickness 

occurring during or arising from your performance of service in a covered business 

or industry or payable under worker’s compensation or an occupational disease act 

or law” are excluded from coverage under the Plan. Skilstaf-00039, Skilstaf-00040 

(emphasis added). The use of the disjunctive “or” indicates that charges for the 

treatment of an injury are not payable under the Plan under two alternative 

scenarios: (1) if the injury occurred during (or arose from) work; or (2) if the injury 

is payable under worker’s compensation or other occupational law. See SkilstafCase 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 4 of 9
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00040; see also Brown v. Budget Rent-A-Car Sys., Inc., 119 F.3d 922, 924 (11th 

Cir. 1997) (“As a general rule, the use of a disjunctive . . . indicates alternatives 

and requires that those alternatives be treated separately.”) (internal citation and 

quotation omitted). Accordingly, charges incurred in connection with the 

treatment of a work-related injury are not covered under the Plan, regardless of 

whether the charges turn out to be “payable under worker’s compensation or an 

occupational disease act or law” or not.3

 See Skilstaf-00039, Skilstaf-00040. 

Even assuming arguendo that the Plan’s work-related injury exclusion 

applies only where treatment for the injury “is payable” by a claimant’s workers’ 

compensation carrier, Skilstaf still made the correct decision to deny coverage in 

this case because Plaintiff’s claims were payable by CSC. See TEX. LABOR CODE 

ANN. § 408.021 (Vernon 2006) (confirming that “[a]n employee that sustains a 

compensable injury4

 is entitled to all health care reasonably required by the nature 

of the injury as and when needed”). CSC denied coverage of Plaintiff’s claims 

because Mr. Berry sought treatment by a provider – Plaintiff – that was not on the 

“TWCC (Texas Workers’ Compensation Commission) approved provider list”; 

 

3

 The April 19, 2005, letter from Toni Spivey to Plaintiff’s counsel confirms that Plaintiff’s 

claims are excluded from coverage under the Plan because “the bills in question are the result of 

an alleged work-related injury . . . .” Skilstaf-00101 (using the disjunctive “or” when she states 

that “the bills in question are the result of an alleged work-related injury or are otherwise subject 

to workers’ compensation law”). Accordingly, Ms. Spivey’s letter does not support Plaintiff’s 

assertion that its claims are covered under the Plan because they were not paid by Dennis Berry’s 

workers’ compensation carrier. (See Plaintiff’s Brief at 9). 

4

 A “[c]ompensable injury” is defined, in pertinent part, as “an injury that arises out of and in the 

course and scope of employment . . . .” TEX. LABOR CODE ANN. § 408.011(10). 

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CSC did not, by contrast, deny coverage because Plaintiff’s claims were otherwise 

not compensable under Texas’ workers’ compensation law. (Plaintiff’s Brief at 

10); see TEX. LABOR CODE ANN. § 408.021 (confirming that “[a]n employee that 

sustains a compensable injury is entitled to all health care reasonably required by 

the nature of the injury as and when needed”); id. at § 408.022 (requiring that an 

injured employee “receive medical treatment from a doctor chosen from a list of 

doctors approved by the commissioner”); id. at § 408.023 (outlining the list of 

approved provider requirements). Plaintiff’s suggestion that Skilstaf is required to 

cover the treatment it rendered to Mr. Berry even though (1) Mr. Berry sought 

treatment from a non-covered provider, and (2) Plaintiff carelessly failed to verify 

that its treatment would be covered by Mr. Berry’s workers’ compensation carrier 

prior to its accepting Mr. Berry’s “assignment of rights” does not pass the “straight 

face” test.5

 Certainly Skilstaf cannot be held responsible for paying damages that 

the Plaintiff suffered at its own hand. 

Plaintiff also incorrectly suggests that, because the Plan’s subrogation, 

reimbursement, and recovery provisions conflict with the Plan’s work-related 

 

5

 Per industry norms, it is utterly inconceivable to Skilstaf that Plaintiff continued treating 

Dennis Berry in a non-emergency situation, and thereby racked up medical bills totaling 

$369,390.00, without ever verifying that its charges were covered by insurance. (See Ex. 3 to 

Skilstaf’s Motion at ¶ 6). Plaintiff’s verification problem is exacerbated by the fact that, at least 

as early as January 17, 2005, Plaintiff, an out-of-state provider, knew that it was not on Dennis 

Berry’s TWCC approved provider list. (See Ex. D to Plaintiff’s Opposition). Despite CSC’s 

repeated denials, Plaintiff continued treating Mr. Berry in connection with his work-related 

injury until approximately August 19, 2005. (See Ex. 3 to Skilstaf’s Motion at ¶ 6). 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 6 of 9
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injury exclusion, Skilstaf should not have denied coverage for Plaintiff’s Dennis 

Berry-related claims. (Plaintiff’s Brief at 10-11). Again, Plaintiff is mistaken: the 

Plan’s subrogation, reimbursement, and recovery provisions expressly demonstrate 

just the opposite – that is, charges incurred when treating work-related injuries are 

excluded from coverage under the Plan. 

The Plan’s SPD provides, in pertinent part, that: 

This plan is not issued in lieu of, nor does it affect any requirement of, 

coverage under any Act or Law which provides benefits for any injury 

or sickness occurring during, or arising from, your course of 

employment. This plan will apply its rights of subrogation and 

reimbursement with respect to work related injuries or sickness even 

though benefits are in dispute or are made by means of settlement or 

compromise; no final determination is made that injury or sickness 

was sustained in the course of or resulted from your employment; the 

amount due for health care is not agreed upon or defined by you or the 

carrier; or the health care benefits are specifically excluded from 

settlement or compromise. In consideration for coverage under the 

plan, you agree to notify the plan of any claim you make. You agree 

to reimburse the plan based on the information above. 

Skilstaf-00062. Plaintiff’s suggestion notwithstanding, the Plan’s subrogation, 

reimbursement, and recovery provisions come into effect when the Plan pays 

money that it is not required to pay under the terms of the Plan. See Skilstaf00052-Skilstaf-00053. That is, if the Plan mistakenly pays a claim that should be 

covered by a claimant’s workers’ compensation carrier, the Plan’s subrogation, 

reimbursement, and recovery provisions require the claimant to return the monies 

that the Plan has mistakenly paid. See Skilstaf-00052-Skilstaf-00053, SkilstafCase 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 7 of 9
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00062. Therefore, Plaintiff’s suggestion that the Plan’s subrogation, 

reimbursement, and recovery provisions conflict with the Plan’s express workrelated injury exclusion is incorrect. To the contrary, those provisions support the 

exact opposite conclusion: treatment for work-related injuries is excluded from 

Plan coverage. 

III. CONCLUSION 

For the reasons detailed above and in its opening brief, Skilstaf is entitled to 

summary judgment in its favor and Plaintiff’s claims should be dismissed with 

prejudice. 

Respectfully Submitted, 

 s/Charles A. Stewart III 

Charles A. Stewart III (STE067) 

Bradley Arant Rose & White LLP

The Alabama Center for Commerce 

401 Adams Avenue, Suite 780 

Montgomery, AL 36104 

Telephone: (334) 956-7700 

Facsimile: (334) 956-7701 

cstewart@bradleyarant.com

s/Amelia T. Driscoll 

Amelia T. Driscoll (DRI016) 

Bradley Arant Rose & White LLP

1819 Fifth Avenue North 

Birmingham, AL 35203-2104 

Telephone: (205) 521-8000 

Facsimile: (205) 521-8800 

adriscoll@bradleyarant.com

Attorneys for Defendant 

Skilstaf, Inc. 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 8 of 9
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CERTIFICATE OF SERVICE

I hereby certify that on April 27, 2007, I electronically filed the foregoing 

with the Clerk of the Court using the CM/ECF system, which will send notification 

of such filing to the following: 

Robert E. Cole 

437 Chestnut Street, Suite 218 

Philadelphia, PA 19109 

Beth A. Friel 

Jeanne L. Bakker 

Mongtomery, McCracken, Walker & Rhoads 

123 South Broad Street 

Philadelphia, PA 19109 

and I hereby certify that I have mailed by U. S. Postal Service the document to the 

following non-CM/ECF participants: None. 

/s/ Amelia T. Driscoll 

Case 3:06-cv-00711-MHT-WC Document 53 Filed 04/27/2007 Page 9 of 9