FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TONI FEIBUSCH, 

Plaintiff-Appellant,

v.

No. 04-16501 INTEGRATED DEVICE TECHNOLOGY,

INC. EMPLOYEE BENEFIT PLAN, D.C. No.  Defendant, CV-03-00265-SOM

and OPINION

SUN LIFE ASSURANCE CO. OF

CANADA,

Defendant-Appellee. 

Appeal from the United States District Court

for the District of Hawaii

Susan Oki Mollway, District Judge, Presiding

Argued and Submitted

July 24, 2006—San Francisco, California

Filed September 7, 2006

Before: Procter Hug, Jr., Gilbert Stroud Merritt,* and

Richard A. Paez, Circuit Judges.

Opinion by Judge Hug

*The Honorable Gilbert Stroud Merritt, Senior United States Circuit

Judge for the Sixth Circuit, sitting by designation. 

10895
COUNSEL

Mark D. DeBofsky, Daley, DeBofsky & Bryant, Chicago, Illinois; Alan Van Etten & Robert D. Harris, Damon Key Leong

Kupchak Hastert, Honolulu, Hawaii, for the plaintiffappellant. 

Keith K. Hiraoka, Roeca Louie & Hiraoka, Honolulu, Hawaii;

Mark E. Schmidtke, Schmidtke Hoeppner Consultants LLP,

Valparaiso, Illinois, for the defendant-appellee.

FEIBUSCH v. SUN LIFE ASSURANCE 10897
OPINION

HUG, Circuit Judge: 

Toni Feibusch (“Feibusch”) appeals the district court’s

decision that Sun Life Assurance Co. of Canada (“Sun Life”)

did not abuse its discretion in terminating her disability benefits. Feibusch’s principal argument is that the district court

incorrectly applied abuse of discretion review rather than de

novo review. Feibusch was denied benefits under policy language that states that proof of a disability claim “must be satisfactory to Sun Life.” 

We have jurisdiction pursuant to 28 U.S.C. § 1291, and we

hold that de novo review applies under the policy language at

issue. We reverse the summary judgment in favor of Sun Life

and remand for trial proceedings. 

I

FACTUAL BACKGROUND

Beginning in 1984, Feibusch was employed by Integrated

Device Technology, Inc. (“IDT”) as a technical writer and

administrative assistant. Her job duties included typing,

answering phones, and creating and maintaining technical

data sheets. In a typical day, she was required to sit for seven

to seven and a half hours, stand for one-half to one hour, walk

for one-half to one hour, and drive for one-quarter hour.

Although her job was largely sedentary, she was occasionally

required to bend, stoop, climb, reach above her shoulders,

kneel, balance, push, and pull. In addition to typing, the job

required constant movement of both hands, and use of the

right hand with the computer mouse. Feibusch earned more

than $50,000 annually. 

Feibusch participated in an IDT-sponsored employee disability benefit plan (the “plan”) regulated under the Employee

10898 FEIBUSCH v. SUN LIFE ASSURANCE
Retirement Income Security Act (“ERISA”), 29 U.S.C.

§§ 1101 et seq. Benefits under the plan were partially funded

by a group long-term disability insurance policy (the “policy”) issued and administered by Sun Life. 

Key to this appeal is the language of several Sun Life policy provisions. According to the policy, proof of a disability

claim “must be satisfactory to Sun Life.” An employee is

“Totally Disabled” if she “because of Injury or Sickness, is

unable to perform all of the material and substantial duties of

[her] own occupation.” An employee is “Partially Disabled”

if she “because of Injury or Sickness is unable to perform all

of the material and substantial duties of [her] own occupation

on a fulltime basis,” but is “performing at least one of the

material and substantial duties of [her] own occupation or

another occupation on a part-time or full-time basis” and

“earning less than 80% of [her] Total Monthly earnings due

to the same injury or Sickness that caused the Total or Partial

Disability.” 

In early 1999, Feibusch complained of shoulder pain. She

temporarily stopped working in March 1999. Dr. Arthur Ting,

Feibusch’s orthopedic surgeon, performed surgery on her

shoulder in July and September 1999. Feibusch returned to

work part-time in January 2000. On August 25, 2000, Sun

Life approved an initial partial disability claim dating from

March 1, 2000. In September 2000, Feibusch underwent a

third shoulder surgery with Dr. Ting. In a November 2000

report, Dr. Ting noted continued improvement in Feibusch’s

condition and stated that despite pain, she had full range of

movement in her shoulder and could work part-time if she

were limited to medium manual activity. Feibusch continued

to receive partial disability payments from Sun Life until January 2001. 

In January 2001, however, Feibusch stopped working altogether and began collecting total disability payments. In

March 2001, Dr. Ting reported that Feibusch was unable to

FEIBUSCH v. SUN LIFE ASSURANCE 10899
return to work. In April 2001, IDT terminated Feibusch’s

employment because she was unable to work full-time without restrictions. In July 2001, Dr. Ting found that Feibusch

had severe limitation of functional capacity and was incapable

of minimum sedentary activity. 

As part of its claim review, Sun Life required Feibusch to

submit to an independent medical examination by Dr. Charles

Borgia. On December 5, 2001, Dr. Borgia stated that Feibusch “could work four hours a day if she took an extra

strength Tylenol three times a day.” A February 7, 2002 Sun

Life file memo on Feibusch’s case concluded that Feibusch

continued to meet the plan’s definition of disability but that

she should undergo rehabilitation to aid her in returning to full

or part-time work. On July 24, 2002, Dr. James Sarni

reviewed Feibusch’s file upon referral from Sun Life and concluded that she “has a functional capability of her shoulder

that would allow her to perform her duties as an administrative assistant.” Dr. Sarni opined that Feibusch could return to

work on a part-time basis for a few months, and then return

to full-time work. 

On August 2, 2002, Sun Life determined that Feibusch no

longer met the policy’s definition of total disability and terminated her benefits effective July 31, 2002. Sun Life explained

that “information in our file at this time fails to support [Feibusch’s] continued physical incapacity to perform the duties

of an administrative assistant.” Feibusch appealed this decision through Sun Life’s internal process. 

As part of the appeal process, Steve Moon, a certified work

capacity evaluator, performed a functional capacity evaluation

of Feibusch for Sun Life. On October 31, 2002, Moon stated

that although he believed Feibusch was in pain, she could

return to work in her former position with certain limitations.

On November 5, 2002, Feibusch underwent another independent medical examination by Dr. Walter Newman. Dr. Newman concluded that although Feibusch was likely to suffer

10900 FEIBUSCH v. SUN LIFE ASSURANCE
from “chronic shoulder pain syndrome” she was “capable of

performing her own occupation as an administrative assistant

and technical writer.” On December 4, 2002, Sun Life issued

a final decision denying Feibusch’s appeal. 

II

PROCEDURAL BACKGROUND

Feibusch filed an ERISA action against IDT and Sun Life.

Pursuant to stipulation, IDT was dismissed from the case. The

parties filed cross-motions for summary judgment. The district court granted Sun Life’s motion for summary judgment,

denied Feibusch’s motion for summary judgment, and

directed the entry of judgment in favor of Sun Life. Feibusch

timely appealed. 

III

ANALYSIS

A. The Proper Standard of Review of Feibusch’s

Benefits Denial

[1] Following Firestone Tire & Rubber Co. v. Bruch, 489

U.S. 101 (1989), we held that district courts must review

ERISA benefit denial claims de novo unless the discretion to

grant or deny claims is unambiguously retained by a plan

administrator or fiduciary. Kearney v. Standard Ins. Co., 175

F.3d 1084, 1090 (9th Cir. 1999) (en banc). Recently, in Abatie

v. Alta Health & Life Ins. Co., No. 03-55601, slip op. 9625,

9636-37 (9th Cir. Aug. 15, 2006) (en banc), we explained: 

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 regardFEIBUSCH v. SUN LIFE ASSURANCE 10901
less of whether the administrator or fiduciary is operating under a possible or actual conflict of interest.

De novo is the default standard of review. If de novo

review applies, no further preliminary analytical

steps are required. The court simply proceeds to

evaluate whether the plan administrator correctly or

incorrectly denied benefits, without reference to

whether the administrator operated under a conflict

of interest. 

But if the plan does confer discretionary authority

as a matter of contractual agreement, then the standard of review shifts to abuse of discretion. We have

held that, 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. The essential first

step of the analysis, then, is to examine whether the

terms of the ERISA plan unambiguously grant discretion to the administrator. 

(internal quotations and citations omitted, emphasis in original). 

[2] The dispositive policy language in Feibusch’s case is

that proof of a disability claim “must be satisfactory to Sun

Life.” This language does not unambiguously provide discretion to the plan administrator. This conclusion clearly follows

from our case law. In Sandy v. Reliance Standard Life Ins.

Co. we stated, “Neither the parties nor the courts should have

to divine whether discretion is conferred. It either is, in so

many words, or it isn’t.” 222 F.3d 1202, 1207 (9th Cir. 2000).

We subsequently emphasized: 

If an insurance company seeking to sell and administer an ERISA plan wants to have discretion in making claims decisions, it should say so. It is not

difficult to write, “The plan administrator has discre10902 FEIBUSCH v. SUN LIFE ASSURANCE
tionary authority to grant or deny benefits under this

plan.” . . . [I]t is easy enough to confer discretion

unambiguously if plan sponsors, administrators, or

fiduciaries want benefits decisions to be reviewed

for abuse of discretion. 

Ingram v. Martin Marietta Long Term Disability Income

Plan, 244 F.3d 1109, 1113-14 (9th Cir. 2001) (internal quotation omitted). 

[3] In light of these guiding statements, the Sun Life policy

language does not merit deferential judicial review. Because

the Sun Life policy does not unambiguously indicate that the

plan administrator “has authority, power, or discretion to

determine eligibility or to construe the terms of the Plan, the

standard of review will be de novo.” Sandy, 222 F.3d at 1207.

This is not to say that “magic words” are required for a plan

to reserve discretion. See Abatie, slip op. at 9637. Instead, the

Sun Life policy language simply does not clearly indicate that

Sun Life has discretion to grant or deny benefits. Indeed, the

language makes no reference whatsoever to granting or denying benefits, and is included under the policy heading “What

is considered proof of claim?” We construe ERISA policy

ambiguities in favor of the insured. See Thomas v. Oregon

Fruit Products Co., 228 F.3d 991, 994 (9th Cir. 2000). 

[4] In Thomas, we held that the ERISA policy term “[beneficiary must provide] satisfactory proof of Total Disability to

us” was insufficient to merit deferential judicial review. Id.

We explained that one possible interpretation of the term was

that proof must be “satisfactory to us,” which would “arguably confer[ ]” discretion on the plan administrator. Id.

(emphasis in original). Under this reasoning, if language only

arguably confers discretion, it does not unambiguously confer

discretion and cannot escape the default of de novo review.

We also note with approval the Second Circuit’s persuasive

analysis of similar policy language: 

FEIBUSCH v. SUN LIFE ASSURANCE 10903
[T]he phrase “proof satisfactory to [the decisionmaker]” is an inadequate way to convey the idea that

a plan administrator has discretion. Every plan that

is administered requires submission of proof that

will “satisfy” the administrator . . . . [T]he administrator’s burden to demonstrate insulation from de

novo review requires either language stating that the

award of benefits is within the discretion of the plan

administrator or language that is plainly the functional equivalent of such wording . . . . [C]ourts

should require clear language and decline to search

in semantic swamps for arguable grants of discretion. 

Kinstler v. First Reliance Standard Life Ins. Co., 181 F.3d

243, 252 (2d Cir. 1999). 

[5] Finally, we examine our ERISA cases that have held

abuse of discretion review to be appropriate. We conclude

that these cases involve policy provisions that are far clearer

in conferring discretion in plan administrators than the provision at issue in Sun Life’s policy. See Abatie, slip op. at 9637

(“The responsibility for full and final determinations of eligibility for benefits; interpretation of terms; determinations of

claims; and appeals of claims denied in whole or in part . . .

rests exclusively with [insurer].”); Jordan v. Northrop Grumman Corp. Welfare Benefit Plan, 370 F.3d 869, 875 (9th Cir.

2004) (“[Insurer] has the discretion to construe and interpret

the terms of the Plan and the authority and responsibility to

make factual determinations.”); Bergt v. Ret. Plan for Pilots

Employed by MarkAir, Inc., 293 F.3d 1139, 1142 (9th Cir.

2002) (Administrator has “power” and “duty” to “interpret the

plan and to resolve ambiguities, inconsistencies and omissions” and to “decide on questions concerning the plan and

the eligibility of any Employee . . .” ); McDaniel v. Chevron

Corp., 203 F.3d 1099, 1107 (9th Cir. 2000) (“[Plan Administrator has] sole discretion to interpret the terms of the Plan”);

Friedrich v. Intel Corp., 181 F.3d 1105, 1110 n.5 (9th Cir.

10904 FEIBUSCH v. SUN LIFE ASSURANCE
1999) (“[Insurer] shall have the sole discretion to interpret the

terms of the Plan and to determine eligibility for benefits.”).

Because we have concluded that a de novo standard of

review applies, we need not reach Feibusch’s arguments that

abuse of discretion review is improper because of 1) an

improper delegation of discretion from IDT to Sun Life, or 2)

Sun Life’s conflict of interest in being both the payor and

administrator of benefits. These issues are only pertinent to an

abuse of discretion standard of review. 

B. The District Court’s Interpretation of

Policy Language

Feibusch argues that the district court misinterpreted the

Sun Life policy by ignoring the provision that an employee

earning $50,000 or more must be able to perform “on a fulltime basis all of the material and substantial duties” of her job

before disability benefits may be terminated. Because Dr.

Ting and some of Sun Life’s evaluators agreed that she was

incapable of full-time work, Feibusch argues that there was no

proper ground for her disability benefits to cease. 

Under the plan, the provisions for when disability benefits

will cease are as follows: 

Total or Partial Disability Benefits will cease on

the earliest of:

1. the date the Employee is no longer Totally or

Partially Disabled; 

2. the date the Employee dies; 

3. the end of the Maximum Benefit Period; 

4. the date the Employee fails to provide adequate

employment earnings information or proof of

FEIBUSCH v. SUN LIFE ASSURANCE 10905
continuing Total or Partial Disability as

requested; 

5. the date the Employee’s current earnings exceed

80% of his Indexed Total Monthly Earnings; 

All Employees earning $50,000 or more annually

6. the date Sun Life determines the Employee is

able to perform on a full-time basis all of the

material and substantial duties of his own occupation, even if the Employee chooses not to

work. 

All Employees earning under $50,000 annually

7. for the first 24 months of Total Disability or for

Partial Disability, the date Sun Life determines

the Employee is able to perform on a full-time

basis all of the material and substantial duties of

his own occupation, even if the Employee

chooses not to work; 

8. after the first 24 months of Total Disability, the

date Sun Life determines the Employee is able

to perform on a full-time basis all of the material

and substantial duties of any occupation for

which he is or becomes reasonably qualified for

by education, training or experience, even if the

Employee chooses not to work. 

[6] The provisions are oddly structured, with three separate

headings, including one that applies only to item 6. The district court determined that items 1 and 6 were alternate bases

for terminating total disability payments. Actually, these provisions cannot serve as alternate bases because item 1 is

inconsistent with item 6. Item 1 may be meant to generally

apply to all employees, but it conflicts with Item 6, which

10906 FEIBUSCH v. SUN LIFE ASSURANCE
applies only to a specific subset of employees that included

Feibusch — those earning at least $50,000. “Under wellsettled contract principles, specific provisions control over

more general terms.” Chan v. Society Expeditions, Inc., 123

F.3d 1287, 1296 (9th Cir. 1997). Under item 1, total disability

benefits cease when the employee is no longer totally disabled.1

Under the plan an employee is totally disabled when she is

unable to “perform all of the material and substantial duties

of [her] own occupation.” Item 6 uses the same exact quoted

words except adding the phrase “on a full-time basis.” Thus,

if item 1 alone can serve as a basis for terminating benefits,

item 6 — the only provision specific to employees earning at

least $50,000 — would serve no purpose whatsoever. “[W]e

must interpret the contract in a manner that gives full meaning

and effect to all of the contract’s provisions.” In re Crystal

Properties, Ltd., 268 F.3d 743, 748 (9th Cir. 2001). Finally,

we note that an ERISA policy ambiguity must be interpreted

in favor of the employee. See Patterson v. Hughes Aircraft

Co., 11 F.3d 948, 950 (9th Cir. 1993). Therefore, item 6 governs and in order to terminate total disability benefits Sun Life

must show that Feibusch was able to perform on a full-time

basis all of the material and substantial duties of her own

occupation. 

[7] Because the district court did not apply the de novo

standard of review and did not correctly interpret the plan’s

provisions for termination of total disability, we reverse the

grant of summary judgment and remand. 

IV

PROCEEDINGS ON REMAND

The district judge’s order stated that if the court conducted

a trial under a de novo standard “the court would find from

1The parties agree that Feibusch is not eligible for partial disability

under the plan because she is no longer working. 

FEIBUSCH v. SUN LIFE ASSURANCE 10907
the overwhelming evidence that Feibusch could work at least

part-time.” (emphasis added). As we have indicated, that

would not be the appropriate inquiry, as the question would

be whether she could work full-time. 

There are significant differences and claims of inaccuracy

regarding the written statements of the various evaluators in

the administrative record. In resolving these discrepancies, it

may be advisable for the court at trial to consider additional

evidence and perhaps oral testimony as is permitted in ERISA

cases. See Mongeluzo v. Baxter Travenol Long Term Disability Benefit Plan, 46 F.3d 938, 943-44 (9th Cir. 1995);

Thomas, 228 F.3d at 997 (suggesting that admission of additional evidence would be helpful on remand when the credibility of various medical experts is at issue); Quesinberry v.

Life Ins. Co. of North America, 987 F.2d 1017, 1025 (4th Cir.

1993) (holding that district court did not abuse its discretion

in considering live expert medical testimony at ERISA bench

trial, when medical issue was complex and when payor on

policy was also the plan administrator). In resolving any factual dispute the court must issue findings of fact and conclusions of law as required by Rule 52(a) of the Federal Rules

of Civil Procedure. 

V

CONCLUSION

The summary judgment is REVERSED and REMANDED

for trial consistent with this opinion. 

10908 FEIBUSCH v. SUN LIFE ASSURANCE