Court Opinion

ID: 46518
Source: CourtListenerOpinion
Date Created: 2010-04-25 23:00:32+00
Date Added: 2024-06-11T17:17:41.732292
License: Public Domain

United States Court of Appeals
                                                                      Fifth Circuit
                                                                   F I L E D
                    UNITED STATES COURT OF APPEALS
                         FOR THE FIFTH CIRCUIT                    November 2, 2006

                        _______________________                Charles R. Fulbruge III
                                                                       Clerk
                              No. 06-10361
                            Summary Calendar
                        _______________________

                             ESTELLE LOGGINS,

                                               Plaintiff-Appellant,

                                  versus

                         NORTEL NETWORKS, INC.,

                                                Defendant-Appellee.

_________________________________________________________________

           Appeal from the United States District Court
                for the Northern District of Texas
                        No. 3:04-CV-2517-N
_________________________________________________________________

Before JONES, Chief Judge, JOLLY, and OWEN, Circuit Judges.

PER CURIAM:*

           Plaintiff Estelle Loggins, an employee of Defendant,

Nortel Networks, Inc. (“Nortel”), appeals the grant of summary

judgment to Nortel on her claim to recoup benefits from a Long Term

Disability Plan (“LTD”) offset by a Business Travel Accident

Insurance (“BTA”) payment.      Because the district court did not err

in finding that the LTD benefits were properly offset by the BTA

payments, we AFFIRM.

     *
            Pursuant to 5TH CIR. R. 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5TH CIR. R. 47.5.4.
                          I.   BACKGROUND

           Loggins suffered a disabling injury while traveling on

company business for Nortel.    She was covered under Nortel’s LTD

plan, which was administered by Prudential Insurance Company of

America (“Prudential”).   The LTD provided benefits in the event an

employee became disabled, while the BTA, furnished by another

insurer, provided for a lump sum payment if an employee was

accidentally killed or disabled while traveling for the company.

Loggins began receiving LTD benefits and also applied for, and

later received (following litigation), a benefit under the BTA plan

in the lump sum amount of $315,000.00.   When Prudential learned of

the BTA amount, Prudential’s Disability Claim Manager notified

Loggins that her LTD benefits would be offset by the BTA award, as

an LTD plan provision requires offsets for “other income.”   Under

the LTD plan, the lump sum amount would be offset in prorated

amounts over sixty months.     He also informed her that previous

overpayments in the amount of $23,600.97, made before Prudential

became aware of the BTA award, must be repaid.       Loggins asked

Prudential to reconsider its decision, which it refused to do.

Loggins then appealed to Nortel’s Employee Benefits Committee

(“EBC”).   The EBC denied her appeal.

           Loggins filed suit in federal court, alleging Nortel

violated her rights under the Employment Retirement Income Security

Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et seq.      The district

                                 2
court granted Nortel’s motion for summary judgment, concluding that

the offset was clearly permitted.     Loggins now appeals.

                       II.   ISSUES ON APPEAL

          Loggins raises a number of issues on appeal.       However,

each of the asserted issues can be consolidated as a single claim

that the district court erred by finding that the two plans were

separate, and thus the BTA benefit could be offset against the LTD

benefits under the LTD’s “other income” provision.

                         III.   DISCUSSION

          When reviewing a grant of summary judgment, we view the

facts and inferences in the light most favorable to the non-moving

party, and we apply the same standards governing the trial court in

its determination.   Blair v. Sealift, Inc., 91 F.3d 755, 760 (5th

Cir. 1996).   Here, the district court reviewed the EBC’s denial of

benefits under an “abuse of discretion” standard because of the

discretion granted to it by the LTD plan.         Loggins v. Nortel

Networks, Inc., No. 3:04-CV-2517-N, 2006 WL 740278, at *1 (N.D.

Tex. March 9, 2006) (citing Meditrust Fin. Servs. v. Sterling

Chem., 168 F.3d 211, 213 (5th Cir. 1999)). The case law establishes

that a plan administrator does not abuse its discretion if its

interpretation of a plan is legally correct.    Id.   Summary judgment

must be granted if a court determines “that there is no genuine

issue as to any material fact and that the moving party is entitled

to a judgment as a matter of law.”     FED. R. CIV. P. (56)(c).

                                  3
                 The district court did not err in concluding that the

EBC’s       interpretation         of    the   LTD   plan’s     offset     provision     was

correct.          The BTA and LTD Summary Plan Descriptions are not

conflicting or misleading.                     Although the BTA promises “extra

financial security,” nowhere does it state that it will permit

double collection for a single injury from multiple policies.

Moreover, the LTD plan is clear that any benefits will be reduced

by    other      sources      of    income.          Although       the   plan    does   not

specifically state that BTA benefits will cause an offset, it does

state that it will be offset by any “disability, retirement or

unemployment benefits provided under any group insurance or pension

plan or any other arrangement of coverage for individuals in a

group....”         It does not list specific sources of such insurance

policies, nor does it exclude any particular policies.

                 Additionally, the cases relied on by Loggins, Hansen v.

Continental Ins. Co., 940 F.2d 971 (5th Cir. 1991), and Rhorer v.

Raytheon Eng’rs & Constructors, 181 F.3d 634 (5th Cir. 1999), are

off point.        These cases dealt with a conflict or ambiguity between

a    plan    summary    given       to    insureds     and    the    actual      ERISA   plan

provisions.           Here, there is no such conflict, but instead an

alleged ambiguity in the summaries of two separate plans. Although

Loggins claims Hansen and Rhorer cannot be so limited, she can

point       to   no   cases    expanding        upon    or    applying      them    in   the

circumstances of this case.

                                                4
            Loggins is also incorrect that the BTA and LTD plans

should be construed as a single plan.               Although they have the

single purpose of providing employee benefits, they are clearly

distinct policies and apply in different situations.1              To construe

them as a single policy would require the court to assume that all

policies providing employee benefits, no matter how differentiated,

comprise a single policy, simply because all plans share the common

goal of compensating employees for various losses.

            There is nothing, other than her assertions, to support

Loggins’s claim that the “other income” provision should be read to

exclude other Nortel plans.        The plan description does not specify

the source of any of the specified categories of “other income,”

and nowhere does it require that they be provided by someone other

than Nortel.2    Loggins cannot point to any plan document suggesting

various Nortel plans should be treated differently from other

sources of insurance.

            Loggins next argues that the “extra benefit” description

in the BTA summary creates an ambiguity between the BTA and the LTD

plans.    This claim is of doubtful merit, as the BTA did provide her

      1
             For example, if Ms. Loggins had died while traveling on company
business, her beneficiaries would have recovered under the BTA policy, but not
the LTD policy.   Additionally, the LTD plan pays benefits for disabilities
arising from any cause, while the BTA plan pays only for accidents occurring
while traveling on company business.
      2
             In fact, it is likely most employees’ retirement benefits would come
from Nortel rather than an outside source; thus, the listing of retirement
benefits as an offset suggests Nortel’s other plans were clearly intended as an
offset under the provision.

                                       5
with an additional benefit of $189,940.20, even after the offset,

because the      lump   sum   payment   is   prorated      over   sixty    months.

Despite the partial offset here, the plan provides a significant

additional benefit to many employees and is not merely “smoke and

mirrors” as Loggins asserts.

            Moreover, even if an ambiguity existed, it would be

resolved in favor of the plan administrator.               Under MacLachlan v.

Exxon/Mobil Corp., 350 F.3d 472, 478-79 (5th Cir. 2003), when, as

here, a plan administrator has been vested discretionary authority

to interpret a plan, courts review the administrator’s decisions

only for abuse of discretion.       Given the doubtful evidence of even

a slight ambiguity, the administrator’s decision here was clearly

within the wide discretion allowed.

            Finally, Loggins’s assertion that the interpretation

expressed   by    Kimberly    Pulliam,      the   Global    Employee      Services

Department (“Global”) employee to whom she spoke regarding a

potential offset, in a phone conversation and email proves the

meaning of the provisions is simply false.            Although employees are

instructed to call that department with general benefits questions,

employees also are told to contact the Claims Administrator for

each specific plan for more detailed information.                 Global was not

the administrator for either the BTA or the LTD, and Global

employees clearly had no authority to bind Nortel.

                                 CONCLUSION

                                        6
          The district court was correct in finding no genuine

issue of material fact.   We therefore AFFIRM the grant of summary

judgment in favor of defendants.

                                   7