Source: https://www.floridabar.org/the-florida-bar-journal/discovery-in-erisa-cases-how-florida-federal-courts-are-changing-the-erisa-landscape-one-case-at-a-time/
Timestamp: 2019-04-23 22:48:05+00:00

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Review of an administrator’s benefit determination under the Employment Retirement Income Security Act (ERISA) when the arbitrary and capricious standard of review applies is ordinarily limited to the administrative record; however, a recent trend in Florida district courts is allowing limited discovery in these cases. This article sets out the standard of review in ERISA benefits determination cases and analyzes the decisions of Florida district courts that permit discovery.
(1) Apply the de novo standard to determine whether the claim administrator’s benefits-denial decision is “wrong” (i.e., the court disagrees with the administrator’s decision); if it is not, then end the inquiry and affirm the decision.
(2) If the administrator’s decision is, in fact, “de novo wrong,” then determine whether the administrator was vested with discretion in reviewing claims; if not, end judicial inquiry and reverse the decision.
(3) If the administrator’s decision is “de novo wrong” and the administrator was vested with discretion in reviewing claims, then determine whether “reasonable” grounds supported the decision (hence, review the administrator’s decision under the more deferential arbitrary and capricious standard).
(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator’s decision; if reasonable grounds do exist, then determine if the administrator operated under a conflict of interest.
(5) If there is no conflict, then end the inquiry and affirm the decision.
A court that reviews a benefits determination under the arbitrary and capricious standard of review is limited to the information the administrator had when the administrator made its decision.
What follows is an examination of two cases that deal with specific discovery requests and how the court analyzed the discovery to determine if it was permissible, which will assist in understanding the types of discovery allowed by Florida district courts.
The opinions rendered by the Florida federal district courts in Grams and Emery lay out how the courts have analyzed discovery requests made by plaintiffs in ERISA cases related to alleged conflict discovery to determine if the requested discovery is appropriate.
In closing, ERISA defendants who are facing discovery requests cloaked as “conflict discovery” should argue that any discovery beyond the administrative record is not allowed pursuant to 11th Circuit precedent, which limits a court’s review of a benefits decision to only the documents that were before the administrator at the time the decision was made to approve or disprove the benefit. ERISA defendants, however, must be mindful that, until the 11th Circuit issues a definitive ruling on the scope of discovery in ERISA cases, there is a myriad of decisions rendered by Florida federal district courts that have allowed limited discovery in certain areas of inquiry, even under the arbitrary and capricious standard of review.
1 Blankenship v. Metropolitan Life Ins. Co., 644 F.3d 1350, 1354 (11th Cir. 2011); Ray v. Sun Life & Health Ins. Co., 443 Fed. Appx. 529, 532 (11th Cir. 2011).
2 Blankenship, 644 F.3d at 1354 (referring to Williams v. BellSouth Telecomms., Inc., 373 F.3d 1132, 1137-38 (11th Cir. 2004), overruled on other grounds by Doyle v. Liberty Life Assurance Co. of Boston, 542 F.3d 1352 (11th Cir. 2008)).
3 Blankenship,644 F.3d at 1354 (referring to Metro. Life Ins. Co. v. Glenn, 554 U.S. 105 (2008)).
5 Id.; Ray, 443 Fed. Appx. at 532.
6 Eldridge v. Wachovia Corp. Long-Term Disability Plan, 2007 WL 117712 at *2 (11th Cir. 2007).
8 Townsend, 295 Fed. Appx. at 976.
9 Jett v. Blue Cross/Blue Shield of Ala.,890 F.2d 1137, 1139 (11th Cir. 1989); see also Ray,443 Fed. Appx. at 533 (“[R]eview of benefits denial is limited to consideration of the material available to the administrator at the time it made its decision.”).
10 Richard v. Intl. Bus. Machs. Corp., 2012 WL 1131996, at * 1 (M.D. Fla. 2012); Cerrito v. Liberty Life Assurance Co. of Boston, 209 F.R.D. 663, 664 (M.D. Fla. 2002).
11 Cerrito, 209 F.R.D at 664; Woodward v. Reliance Stand. Life Ins. Co., 2003 WL 1798519 at *1 (N.D. Fla. 2003) (quoting Cerrito); Rosser-Monahan v. Avon Prods. Inc., 227 F.R.D. 695, 698 (M.D. Fla. 2004) (quoting Cerrito); Crume v. Metro. Life Ins. Co., 388 F. Supp. 2d 1342, 1344-45 (M.D. Fla. 2005) (quoting Cerrito); Fish v. Unum Life Ins. Co. of Am., 229 F.R.D. 699, 701 (M.D. Fla. 2005) (quoting Cerrito); Crume v. Metro Life Ins. Co., 387 F. Supp. 2d 1212, 1213 (M.D. Fla. 2005) (quoting Cerrito); Barron v. Gen. Electric, 2006 WL 905514, at *1 (M.D. Fla. 2006) (quoting Cerrito); Self v. The Prudential Ins. Co. of Am., 2010 WL 996503, at *3 n. 2 (N.D. Fla. 2010) (quoting Cerrito); Richard, 2012 WL 1131996, at *2 (quoting Cerrito); Lake v. Hartford Life & Accident Ins. Co., 218 F.R.D. 260, 261 n. 1 (M.D. Fla. 2003) (citing to Cerrito and holding “[d]iscovery may be permitted beyond the administrative record when it is relevant to (1) examining whether an administrator fulfilled his or her fiduciary duties, (2) whether proper procedures were followed in compiling the record; (3) whether the record is complete; and (4) whether the administrator had a conflict of interest”).
12 Crume, 388 F. Supp. 2d at 1345; Fish, 229 F.R.D. at 701; see also Rosser-Monahan, 227 F.R.D. at 698.
13 Rosser-Monahan, 227 F.R.D. at 698.
14 Fish, 229 F.R.D. at 701.
15 Rosser-Monahan, 227 F.R.D. at 699.
16 Lake, 218 F.R.D. at 261.
17 Cerrito, 209 F.R.D. at 664.
18 Self, 2010 WL 996503 at *2.
19 Id. (quoting Woodward, 2003 WL 1798519 at *1).
21 Barron, 2006 WL 905514 at *1.
24 Self, 2010 WL 996503 at *3.
25 Lelu,626 F. Supp. 2d at 1231.
31 Grams, 2009 WL 2926844 at *1.
34 Id. at *2, n. 4.
37 Id. at *2, n. 5.
56 Emery, 2010 WL 457151 at *1.
Emilia A. Quesada is a partner at Sanchez-Medina, Gonzalez, Quesada, et al., (SMGQ Law) in Miami, where she practices in the areas of commercial litigation, banking litigation, and insurance coverage matters including life, health, disability, and ERISA disputes. She is a certified FINRA public arbitrator.
This column is submitted on behalf of the Labor and Employment Law Section, Frank E. Brown, chair, and Robert Eschenfelder, editor.

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