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Doe v. Standard Insurance Co.

United States District Court, D. Maine

July 21, 2016

JANE DOE, Plaintiff,
v.
STANDARD INSURANCE COMPANY, Defendant.

          JANE DOE, Plaintiff, represented by GERALDINE G. SANCHEZ, ROACH HEWITT RUPRECHT SANCHEZ & BISCHOFF, P.C..

          STANDARD INSURANCE COMPANY, Defendant, represented by BROOKS R. MAGRATTEN, PIERCE ATWOOD LLP, pro hac vice & KYLE N. KIRBY, PIERCE ATWOOD LLP.

          ORDER ON MOTIONS FOR JUDGMENT

          GEORGE Z. SINGAL, District Judge.

         Before the Court are cross-motions for judgment by Defendant (ECF No. 32) and Plaintiff (ECF No. 33). As explained herein, the Court GRANTS Defendant's Motion for Judgment on the Record (ECF No. 32) and DENIES Plaintiff's Motion for Judgment on the Record (ECF No. 33).

         I. STANDARD OF REVIEW

         Generally, a party is entitled to summary judgment if, on the record before the Court, it appears "that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c)(2). The party moving for summary judgment must demonstrate an absence of evidence to support the nonmoving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). In determining whether this burden is met, the Court must view the record in the light most favorable to the nonmoving party and give that party the benefit of all reasonable inferences in its favor. Santoni v. Potter, 369 F.3d 594, 598 (1st Cir. 2004). This "standard is not affected by the presence of cross-motions for summary judgment." Alliance of Auto. Mfrs. v. Gwadosky, 430 F.3d 30, 34 (1st Cir. 2005) (citation omitted). Even when filed simultaneously, "[c]ross-motions for summary judgment require the district court to consider each motion separately, drawing all inferences in favor of each nonmoving party in turn." AJC Int'l, Inc. v. Triple-S Propiedad, 790 F.3d 1, 3 (1st Cir. 2015) (internal quotations and citations omitted).

         However, when a case challenges the denial of benefits under Employee Retirement Income Security Act of 1974 (ERISA), codified in relevant part at 29 U.S.C. §§ 1001-1461, crossmotions for summary judgment are "nothing more than vehicles for teeing up [the case] for decision on the administrative record." Stephanie C. v. Blue Cross Blue Shield of Massachusetts HMO Blue, Inc., 813 F.3d 420, 425 (1st Cir. 2016); see also Orndorf v. Paul Revere Life Ins. Co., 404 F.3d 510, 517 (1st Cir. 2005). With both sides' arguments queued up via cross-motions, the Court reviews the same record that was before the plan administrator and "evaluates the reasonableness of an administrative determination in light of the record compiled before the plan fiduciary." Leahy v. Raytheon Co., 315 F.3d 11, 17-18 (1st Cir. 2002) (applying this standard when the parties moved for cross-summary judgment).

         As the First Circuit explained in Colby v. Union Sec. Ins. Co. & Mgmt. Co. for Merrimack Anesthesia Associates Long Term Disability Plan, 705 F.3d 58 (1st Cir. 2013):

Where, as here, the administrator of an ERISA plan is imbued with discretion in the interpretation and application of plan provisions, its use of that discretion must be accorded deference. It follows that judicial review is for abuse of discretion. In the ERISA context, this metric is equivalent to the familiar arbitrary and capricious standard. Whatever label is applied, the relevant standard asks whether a plan administrator's determination is plausible in light of the record as a whole, or, put another way, whether the decision is supported by substantial evidence in the record.'

         Id. at 61 (quoting Leahy v. Raytheon Co., 315 F.3d 11, 17 (1st Cir. 2002) with other citations omitted). "Evidence is deemed substantial when it is reasonably sufficient to support a conclusion." Ortega-Candelaria v. Johnson & Johnson, 755 F.3d 13, 20 (1st Cir. 2014) (citations and internal quotations omitted). Notably, when a plan administrator both evaluates and pays claims under a plan, there is an inherent conflict of interest. "This inherent conflict may be weighed as a factor in assessing the reasonableness of [the plan administrator]'s decision, but its existence does not perforce alter [the] standard of review." Colby, 705 F.3d at 62 (citing Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 115, 117 (2008)).

         With this standard in mind, the Court provides the factual recitation that follows, which is drawn from the parties' submissions of statements of material fact, and the responses thereto, [1] as well as the Court's review of those portions of the sealed Administrative Record ("AR") that the parties have cited to in these submissions.

         II. FACTUAL RECORD

         Plaintiff Jane Doe[2] was employed as an attorney at a law firm in Maine for more than twenty-five years. (Pl. SMF ¶ 3.) She was an equity partner at the firm until August 2011. (Pl. SMF ¶ 1.) After August 2011, Plaintiff remained employed as a non-equity partner until February 2012, when her employment terminated. (Pl. SMF ¶ 2.) In 2010, Plaintiff had K-1 income of $175, 913.00. In 2011, Plaintiff's K-1 income dropped by approximately sixty-six percent ($116, 249.00), yielding a total 2011 income of $59, 664.00. (Pl. SMF ¶ 28 & AR 391.)

         Plaintiff's Long-Term Disability ("LTD") Plan

         Plaintiff was insured under a long-term disability plan offered by the Law Firm to employees. (Pl. SMF ¶ 4 & Def. SMF ¶ 2.) The plan was fully insured by a long term disability policy[3] issued by Defendant Standard Insurance Company (also known as "The Standard"), which both determines eligibility for benefits under the Policy and pays the claims. (Pl. SMF ¶¶ 5 & 6; Def. SMF ¶ 5.) The Policy provides coverage for (1) any total disability that prevents the insured from performing her "Own Occupation" or (2) or "Partial Disability." (Pl. SMF ¶ 5.) The plan defines the term "Mental Disorder" to include "depression and depressive disorders." (Def. SMF ¶ 9 & AR 381.) Benefits under the plan are subject to a 90-day Benefits Waiting Period, such that participants must be "continuously Disabled" for at least 90 days before any LTD benefits become payable. (Def. SMF ¶ 7 & AR 363, 386.)

         More specifically, as it relates to the pending dispute, the Policy provides the following material terms:

Definitions of Own Occupation and Partial Disability
You are Disabled if you meet one of the following definitions during the period it applies:
A. Own Occupation Definition Of Disability; or
B. Partial Disability Definition.
A. Own Occupation Definition Of Disability
During the Benefit Waiting Period and the Own Occupation Period you are required to be Disabled only from your Own Occupation.
You are Disabled from your Own Occupation if, as a result of... Mental Disorder, you are unable to perform with reasonable continuity the Material Duties of your Own Occupation.
***
[The Specialty Language]
If you are an attorney at law and you have practiced law for at least 5 years, during the Benefit Waiting Period and through the Own Occupation period, we will consider your Own Occupation to be the one legal subject matter area or type of legal practice in which you specialize, provided you have earned at least 85% of your gross professional service fee income in that area or type of practice during the 24 months immediately before you become Disabled.
[B.]Partial Disability Definition
During the Benefit Waiting Period and the Own Occupation Period, you are Partially Disabled when you work in your Own Occupation but, as a result of... Mental Disorder, you are unable to earn 80% or more of your Indexed Predisability Earnings, in that occupation.
Definition of "Temporary Recovery "
You may temporarily recover from your Disability and then become Disabled again from the same cause or causes without having to serve a new Benefit Waiting Period. Temporary Recovery means you cease to be Disabled for no longer than the applicable Allowable Period...
Allowable Periods [means]
1. During the Benefit Waiting Period: a total of 30 days of recovery.
2. During the Maximum Benefit Period: 180 days for each period of recovery.
If your Temporary Recovery does not exceed the Allowable Periods...[t]he Predisability Earnings used to determine your LTD Benefit will not change.
Definition of "Predisability Earnings"
[Y]our Predisability Earnings will be based on your Employer's prior tax year....Predisability Earnings means your average monthly compensation from your Employer during the Employer's prior tax year.

(Pl. SMF ¶ 12 & AR 369, 371-72 & 381.)

         The Plan confers upon Standard "full and exclusive authority to control and manage the [plan], to administer claims, and to interpret the [plan] and resolve all questions arising in the administration, interpretation, and application of the [plan]." (Def. SMF ¶ 10 & AR 384.) It further provides that all of The Standard's decisions in the exercise of its authority are "conclusive and binding." (Def. SMF ¶ 11 & AR 384.) The Plan allows a participant to request a review of any part of a claim that is denied, and that review is to be conducted by someone other than the person who denied the original claim. (Def. SMF ¶ 12 & AR 383.) The participant must request any review "in writing" and "within 180 days after receiving notice" of the decision to be reviewed. (Def. SMF ¶ 13 & AR 383.)

         Plaintiff had a "legal practice in which she specialized, " meaning she had practiced law for more than five years and had a specific type of specialized legal practice (the "Specialty Own Occupation"). (Pl. SMF ¶¶ 7 & 8; AR 369.)

         Plaintiff's Disability

         On November 30, 2011, Plaintiff appeared for a scheduled regular examination with her gynecologist, Kathleen Petersen, M.D. (Pl. SMF ¶ 13.) Dr. Petersen's contemporaneous November 30, 2011 record (the "11/30/11 Petersen Record") stated the following regarding Doe:

She hopes she can "unload some concerns on me"... [O]ver the past year or so, she has become "bone crushingly exhausted." She does not have any interest in life.... She will fall asleep, but then wake up at 3 a.m., and "have a horrid time getting back to sleep. These last couple of months have been just awful for her.... She feels as though her husband is pressuring her to work more and earn more money. She feels as though nobody would miss her if she was gone....

(Pl. SMF ¶ 14 & AR 520-21 (redacted).) Although Doe was resistant to advice that she seek counseling, Dr. Petersen increased her citalopram to 40 mg daily.[4] (Id. (redacted).)

         On December 9, 2011, clinical psychologist Frederick White, Ph.D., first saw Doe. His records from this first visit (the "12/9/11 White Record") included the following notes: symptoms included pervasive sadness, depressed mood, fatigue, suicidal ideation ("SI"), decreasing selfesteem, increasing frequency of tearfulness; the onset of the symptoms had increased in the past year to the "tipping point;" the mental status report concluded "quite depressed" mood, decreased attention, concentration and memory, her appetite and weight were down, sleep was impaired but "most recently" she was experiencing hypersomnia, speech was slowed, she had suicidal ideation with means but "denies plan intent presently, " but "contract for safety" was also noted. (Pl. SMF ¶ 15 & AR 480-81 (redacted).) Dr. White diagnosed her with Major Depressive Disorder (ICD 296.23) with a GAF score of 40.[5] (Pl. SMF ¶ 16 & AR 481.) In a letter to Standard Insurance Company, dated May 22, 2013, Dr. White explained:

Ms. [Doe] engaged my services beginning with her initial intake at my office on December 9, 2011. I can verify that her disability predates this initial session insofar as her call requesting to be seen for evaluation and treatment occurred early in November, 2011. Her report on interview during intake stated that she became aware of onset of symptoms no less than one year prior.

(Pl. SMF ¶ 18 & AR 466.)

         Dr. White saw Doe again on December 12, 2011 and December 15, 2011, and provided an assessment that Doe was having continuing mental disorder with suicidal ideation. Doe and Dr. White contracted for her safety. (Pl. SMF ¶ 19 & AR 482 (redacted).) On January 5, 2012, Dr. White saw Doe after the holidays. She reported doing better during holidays and masking her depression. She appeared better rested and her facial and posture were more upbeat. Her suicidal risk continued to decrease. (Pl. SMF ¶ 20 & AR 482 (redacted).)[6]

         Dr. Petersen also saw Doe on January 5, 2012 (the "1/5/12 Petersen Record") and noted the following:

Doe has seeing Dr. Fred White.... [Dr. White] did call me today. [Dr. White] did see [Doe] today and states [Doe] has some suicidal ideation but no real plan or intent. [Dr. White] did ...

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