Court Opinion

ID: 8203600
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:49:38.01733+00
Date Added: 2024-06-11T16:41:03.244386
License: Public Domain

SHIRLEY S. ABRAHAMSON, C.J.
¶ 71. (dissenting). The majority opinion correctly states the law but then fails to apply it. I therefore dissent.
¶ 72. I agree with the court of appeals (although my reasoning differs from that of the court of appeals) *550that BlueCross BlueShield is not entitled to a judgment. as a matter of law and that the cause should be remanded to the circuit court.
¶ 73. The applicable law is clear: When an ERISA plan expressly gives the plan administrator discretion to interpret the terms of the plan, as the Plan at issue here does, a reviewing court will review the administrator's exercise of discretion under an "arbitrary and capricious" standard. Majority op., ¶¶ 34, 50, 54. Judicial review of the plan administrator's decision is limited "to the record available to the plan administrator at the time the decision was made." Majority op., ¶¶ 35, 51.
¶ 74. I have carefully read the majority opinion to find the plan administrator's interpretation of the Plan and the administrator's exercise of discretion. I can't find them. The majority opinion assumes the plan administrator interpreted the Plan but does not tell us who the plan administrator is, when the administrator made a decision about subrogation, or how and why the plan administrator made the decision about subrogation. See, e.g., majority op., ¶¶ 55, 57.
¶ 75. I carefully searched the record to no avail to discover who the plan administrator is. A complete copy of the Plan is not in the record. The parties' briefs inform us that BlueCross BlueShield is a third-party administrator of the Plan, at least in regards to the payment of health benefits.
¶ 76. As third-party administrator of the health benefits of the Plan, BlueCross BlueShield was required to make the medical payments at issue regardless of whether the injuries were caused by an accident for which some other person is liable. The payment of medical expenses does not tell us who had discretion to *551interpret the Plan; the payment does not illuminate the interpretation and determination regarding subrogation.
¶ 77. The first mention of subrogation was in Steffens' complaint. The complaint alleged that Blue-Cross BlueShield is joined as a party because of possible subrogation rights and to comply with Wis. Stat. § 803.03. The complaint further demanded judgment against BlueCross BlueShield "foreclosing any claim they may have for subrogation or other right to reimbursement they may have."
¶ 78. The insurance company's pleading demanded subrogation, and an affidavit by the insurance company's counsel is in the record. The affidavit reveals nothing about the plan administrator or the plan administrator's decision.
¶ 79. I searched the record to find the answers to many questions: When did the plan administrator interpret the Plan? What was that interpretation? What decision was made? On what facts was decision based? And what was the plan administrator's reasoning in reaching the decision? I can't find answers in the record to any of these questions.
¶ 80. No copy of the plan administrator's decision is in the record.1 No affidavit of the plan administrator *552is in the record. Nevertheless, the majority opinion declares that it is evaluating the plan administrator's decision on the basis of the information the administrator had when it made its decision.
¶ 81. A court cannot evaluate an interpretation and decision of a plan administrator and determine whether that decision is arbitrary and capricious without knowing what the interpretation and decision is, and on what it is based.2
¶ 82. It seems that the majority is relying on the counterclaim and cross-claim of BlueCross BlueShield in the present litigation as the plan administrator's determination and interpretation of the Plan language. See majority op., ¶ 57. BlueCross BlueShield does not allege in its pleadings that it is the plan administrator. The allegations do not include an interpretation of the Plan. Is the majority allowing a claimant to "be sandbagged by after-the-fact plan interpretations devised for purposes of litigation [?]"3
¶ 83. In that counterclaim, BlueCross BlueShield alleges:
Pursuant to the terms of the plan in question as reflected in the reimbursement provision, plaintiff John R. Steffens, is obligated to reimburse [BlueCross BlueShield] in an amount equal to the amounts paid by [it], out of any recovery by the plaintiff in this action, whether by settlement, judgment or otherwise.
*553¶ 84. This allegation was made when the plaintiff was asserting in the litigation that the back injury (and the subsequent costs of the back surgery) was caused by the negligence of the tortfeasor. BlueCross BlueShield's allegation seems to rely on that assertion. The majority also seems to rely on the plaintiffs original assertion that the back injury was caused by the accident to support its reasonableness determination. Majority op., ¶ 59. According to the majority opinion, the plaintiffs original pleadings and assertions in the early stages of this litigation present compelling facts that seem to "undeniably show that, according to Steffens, the surgery-necessitating injuries arose out of the June 2005 accident." Majority op., ¶ 62. Steffens is not the plan administrator.
¶ 85. Even if the plan administrator's "decision" relied solely upon the plaintiffs allegations, then when the plaintiff no longer was asserting that the back injury arose out of the negligent acts of the tortfeasor, did the plan administrator update its determination? Perhaps the majority is relying on BlueCross BlueShield's motion for declaratory judgment as the plan administrator's decision subsequent to the plaintiffs changed assertions regarding the cause of the lower back injury that necessitated the surgery. If so, what was the basis for its updated determination? The majority doesn't say and scouring the record doesn't produce an answer.
¶ 86. On the record in the present case, neither the majority nor I can review the plan administrator's decision to determine whether it is arbitrary and capricious, and we cannot limit our review "to the record available to the plan administrator at the time the decision was made." Majority op., ¶¶ 35, 51.
¶ 87. I dissent because nothing in the record articulates the plan administrator's interpretation or *554application of the Plan's subrogation language. There is no analysis or reasoning of the plan administrator to which the court may defer under the arbitrary and capricious standard.
¶ 88. Accordingly, I would remand the matter to the circuit court for the determination of what (if any) interpretation and determination the plan administrator (whoever that is) made, when, and why. If the plan administrator did not interpret the Plan or make a determination, then the circuit court must, as a matter of law, interpret and apply the Plan language as it would any other contract.4
¶ 89. For the reasons set forth, I dissent.
¶ 90. I am authorized to state that Justice ANN WALSH BRADLEY joins this opinion.

 I acknowledge that plan claimants are statutorily entitled to a timely and specific explanation of a claim denial and that a similar statutory requirement is not specifically provided for a plan administrator to interpret the plan language and invoke the subrogation rights of the Plan. I conclude, however, that the underlying arguments are as pertinent to the present situation as they are in the benefits claim situation. In both instances, a timely and specific explanation allows the plan beneficiary to respond to the plan administrator's interpretation and allows a court to do its review.

 In the review of a denial of benefits claim, a court is free to "ignore ERISA plan interpretations that did not actually furnish the basis for a plan administrator's benefits decision." Marolt v. Alliant Techsystems, Inc., 146 F.3d 617, 620 (8th Cir. 1998).

 Marolt v. Alliant Techsystems, Inc., 146 F.3d 617, 620 (8th Cir. 1998).

 "Where a trustee fails to act or to exercise his or her discretion, de novo review is appropriate because the trustee has forfeited the privilege to apply his or her discretion; it is the trustee's analysis, not his or her right to use discretion or a mere arbitrary denial, to which a court should defer." Gritzer v. CBS, Inc., 275 F.3d 291, 296 (3rd Cir. 2002).