Opinion ID: 3003254
Heading Depth: 2
Heading Rank: 1

Heading: The Proper Standard of Review under ERISA

Text: A central question in this appeal is whether this court should review Cigna’s decision de novo, as Raybourne argues, or as Cigna argues, for abuse of discretion. The answer hinges on the language of the plan documents. See Glenn, 128 S.Ct. at 2348; Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). De novo review is presumed to apply unless the plan documents clearly state that the plan administrator has discretionary authority to determine whether benefits are due. Firestone, 489 U.S. at 115; Herzberger v. Standard Ins. Co., 205 F.3d 327, 331 (7th Cir. 2000). A plan’s express grant of discretion to the administrator lowers the standard of judicial scrutiny from de novo to abuse-of-discretion. Firestone, 489 U.S. at 115. To demonstrate that the abuse-of-discretion standard applies, Cigna points to a document entitled “Employee Welfare Benefit Plan Appointment of Claim Fiduciary” (hereafter, “Claim Fiduciary Appointment”), which grants Cigna “the authority, in its discretion, to interpret the terms of the Plan . . . to decide questions of eligibility for coverage or benefits under the Plan.” That grant of discretion is also described in a Summary Plan Description (“SPD”), which states that “[t]he Plan No. 08-2754 7 Administrator has delegated to the insurance company the full and complete discretionary authority and responsibility to decide all questions of eligibility for benefits under the Plan.” This court has found similar (indeed, almost identical) language to be sufficient to trigger review under the abuse-of-discretion standard. See Leipzig v. AIG Life Ins. Co., 362 F.3d 406, 408 (7th Cir. 2004); Herzberger, 205 F.3d at 331. Instead of suggesting that the quoted language is insufficient to confer discretion, Raybourne argues that the Claim Fiduciary Appointment is not a plan document. According to Raybourne, the Claim Fiduciary Appointment is an extrinsic document that he did not receive until this litigation was underway, and it is neither incorporated nor referenced anywhere in the plan. But the language of the Claim Fiduciary Agreement explains why Raybourne did not receive it—it states that the plan administrator must describe its discretion “in Summary Plan Descriptions furnished to Participants.” The SPD—which describes the plan’s grant of discretion to Cigna—explains that the “actual provisions of the Plan are set forth in the insurance policy and the claims fiduciary agreement between L-3 Communications and Cigna.” Elsewhere we have rejected Raybourne’s assumption that only the original plan (here, the underlying insurance policy) may be considered in determining whether a plan administrator is entitled to deference: “often the terms of an ERISA plan must be inferred from a series of documents none clearly labeled as ‘the plan.’ ” Semien, 426 F.3d at 811 (citation omitted); Ruiz v. Continental Cas. Co., 400 F.3d 986, 990-91 (7th Cir. 2005) 8 No. 08-2754 (noting that an insurance policy and a policy certificate can be “plan documents”); see also Cagle v. Bruner, 112 F.3d 1510, 1517 (11th Cir. 1997) (noting that it is appropriate to review trust documents “in the search for a reservation of discretion”). In Semien, we considered alongside the original plan a fiduciary agreement similar to the one put forth by L-3 here. 436 F.3d at 810-11. And given that the Claim Fiduciary Appointment provides the name of the plan and plan administrator, is signed by representatives of the plan and Cigna, and states that it “shall be effective” from the date of the underlying insurance policy, it is difficult to see how it could be anything other than a plan document. Raybourne argues relatedly that neither the Claim Fiduciary Appointment nor the SPD is the type of document that this court has considered sufficient to bestow discretion on a plan. He relies on Ruttenberg v. United States Life Insurance Company, 413 F.3d 652 (7th Cir. 2005), and Schwartz v. Prudential Insurance Company of America, 450 F.3d 697 (7th Cir. 2006), but both of those cases are distinguishable. In Ruttenberg we refused to consider a grant of discretion set forth in an application for employee benefits because the application represented only the negotiations leading up to the insurance contract, and the contract itself was silent on the issue of discretion. 413 F.3d at 660. By contrast, here the Claim Fiduciary Appointment modifies the terms of the underlying plan, and its grant of discretion to Cigna is described in the SPD furnished to L-3 employees. In Schwartz we held that a grant of discretion that appears in an SPD but not the underlying plan is insufficient to No. 08-2754 9 warrant deferential review because an SPD—which is meant to be a plain language version of the underlying plan—may not confer rights that the plan itself does not. 450 F.3d at 699. But here the discretion described in Cigna’s SPD does not exist in a vacuum; the Cigna SPD refers to the Claim Fiduciary Appointment and explains the discretion that it confers. We thus conclude that the Claim Fiduciary Appointment is a plan document, and accordingly, the abuse-of-discretion standard of review applies.