Opinion
Civil Action No. 3:03-CV-2340-G.
November 24, 2004
MEMORANDUM ORDER
Before the court is the motion of the defendants SBC Disability Income Plan ("SBC DIP" or the "Plan") and Sedgwick Claims Management Services, Inc. ("Sedgwick") (collectively, the "defendants") for summary judgment pursuant to Rule 56(c) of the Federal Rules of Civil Procedure ("Motion for Summary Judgment") on all claims asserted against them by the plaintiff, Cora Talbert ("Talbert"). For the reasons stated below, the defendants' motion for summary judgment is granted.
I. BACKGROUND
This action challenges the denial of benefits under an employee disability plan governed by the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), 29 U.S.C. § 1001 et seq.
Talbert has been employed with Southwestern Bell Telephone, L.P. (now "SBC") since 1977. Plaintiff's Brief in Response to SBC DIP and Sedgwick's Motion for Summary Judgment ("Talbert's Response") ¶ 1. Currently Talbert is employed as a service representative, and served in the same capacity at all times relevant to this action. Id.; Defendants SBC DIP and Sedgwick's Brief in Support of Motion for Summary Judgment ("Defendants' Brief") at 1. On or about May 1, 2002, Talbert suffered an anxiety attack while at work. Talbert's Response ¶ 2; Defendants' Brief at 2. Talbert was treated at Arlington Memorial Hospital as a result of this attack, and during the course of her treatment was diagnosed as suffering from acute anxiety. Talbert's Response ¶ 2. A claim under the Plan was made due to Talbert's "relapse absence from work due to an illness or injury." Talbert's Response ¶ 3.
SBC contracted with Sedgwick to administer disability benefits claims under the Plan. Affidavit of Lisa Trevino, Exhibit B to the Appendix to Defendants SBC DIP and Sedgwick's Brief in Support of Motion for Summary Judgment ("Defendants' Appendix") at 251-52 ("SBC Communications Inc. contracts with Sedgwick to process disability claims, review medical records, request additional medical documentation to support the claims, and ultimately recommend acceptance or denial of disability benefits claims. Sedgwick employees who process disability claims under the [Plan] are part of SBC's Medical Absence and Accommodations Resource Team ("SMAART").").
Talbert's claim was assigned to SMAART case manager Sherry Barth ("Barth") for review and administration. Talbert's Response ¶ 4. After receiving medical records and documentation, Barth approved benefits for Talbert from May 9, 2002 to May 28, 2002. Id. Barth further notified Talbert's treating physician, Dr. Karuna Vangala ("Vangala") that additional documentation would be required by May 23, 2002 if the benefits were to extend beyond May 28, 2002. Id. Vangala referred Talbert to a psychiatrist, E. Fred Tulloch, Ph.D. ("Tulloch") who, after two sessions with Talbert, notified Barth that he had diagnosed Talbert as suffering from general anxiety disorder, panic attacks, and major depression. Defendants' Brief at 3. Upon receiving supporting documents from Tulloch, Barth extended Talbert's benefits through June 9, 2002. Id. Barth again notified Tulloch that "updated medical records including chart notes, diagnostic tests and hospital summaries," must be received by June 5, 2002 to extend Talbert's benefits beyond June 9, 2002. Talbert's Response ¶ 6.
On June 6, 2002, Talbert began psychiatric treatment with Moses Ramos, M.D., P.A. ("Ramos"). Id. ¶ 9. Talbert informed SMAART of her first visit with Ramos and an appointment she had the following day for a physical exam with Keith Wixtrom, M.D. Defendants' Brief at 4. Accordingly, Talbert's benefits were extended to June 30, 2002 so that SMAART could receive the results of these two examinations. Id. Ramos submitted an Initial Physician Statement to SMAART on June 14, 2002, in which he diagnosed Talbert with a panic disorder and submitted a possible return to work on July 8, 2002. Id. Ramos was informed that he must submit updated medical documentation by July 2, 2002 in order to extend Talbert's benefits beyond July 7, 2002. Id.
On July 8, 2002 SMAART received an "Excuse Slip" from Ramos in which he stated that Talbert was unable to return to work due to "continued disability and treatment" and stated that she should be out on total disability until July 29, 2002. Excuse Slip dated July 8, 2002, Defendants' Appendix at 173. Ramos followed up the excuse slip with a letter dated July 9, 2002 providing the same diagnoses and recommendation. Defendants' Brief at 5. In light of these submissions, Talbert's benefits were extended through July 22, 2002, so that her claim could be reviewed. Id. at 5-6.
On July 19, 2002, Barth discussed the claim with a SMAART Physician Advisor, Dr. Kahn, who determined that the medical information SMAART received did not support an extension of Talbert's benefits. Id. at 6. On July 30, 2002, Barth sent a letter (the "denial letter") to Talbert informing her that her disability benefits were denied effective July 22, 2002. Talbert's Response ¶ 10. The denial letter stated that Talbert's claim did not fall within the definition of "total disability," which is defined in the Plan as follows:
"`Total Disability' or `Totally Disabled' means, with regard to Short Term Disability, that because of Illness or Injury, an Employee is unable to perform all of the essential functions of his job or another available job assigned by the Participating Company with the same full- or part-time classification for which the Employee is qualified."
Denial Letter at 1, Defendants' Appendix at 166. The denial letter further stated that "the information submitted by Dr. Ramos . . . did not contain clinical findings from a mental health status examination, a description of [Talbert's] presentation, a description of [Talbert's] limitations based on observed clinical findings or a description of [Talbert's] inability or ability to perform activities of daily living." Id. at 1-2, Defendants' Appendix at 166-67.
Talbert appealed the denial of benefits to the SMAART Quality Review Unit. Defendants' Brief at 7. As part of this administrative appeal, Ann Williams, R.N. ("Williams") reviewed Talbert's claim and file. Id. Furthermore, Williams submitted Talbert's file "to an independent physician advisor and board certified psychiatrist, Jack Greener, M.D. ("Greener")." Id. As a result of his review, Greener submitted a letter dated September 4, 2002 (the "Greener Report"), in which he opined that Talbert could perform her job on a part-time basis. Greener Report at 4-5, Defendants' Appendix at 123-24. Greener further provided that there was not "objective evidence of cognitive impairment" and that the session notes submitted to SMAART did not evince the severity expressed by Ramos or Tulloch. Id. Accordingly, on September 16, 2002, Talbert's appeal was denied. Talbert's Response ¶ 13.
Talbert returned to work on September 23, 2002; however, she was only able to work a half-day. Id. ¶ 14. Between September 23 and October 9, 2002, Talbert used vacation time and missed work completely for medical and other family emergency reasons. Id. On October 10, 2002, Talbert returned to work, but suffered another attack and received disability benefits until her return to work on January 2, 2003. Id. Talbert has apparently had several relapses since January 2, 2003, and she has received benefits for each claim made. Id.
Talbert filed the instant action on October 7, 2003, alleging wrongful denial of benefits under ERISA. See generally Plaintiff's First Amended Original Complaint. The defendants filed the instant motion for summary judgment on September 24, 2004.
II. ANALYSIS A. Evidentiary Burdens on Motion for Summary Judgment
Summary judgment is proper when the pleadings and evidence before the court show that no genuine issue exists 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). The movants make such a showing by informing the court of the basis of their motion and by identifying the portions of the record which reveal there are no genuine material fact issues. Celotex Corporation v. Catrett, 477 U.S. 317, 323 (1986). "[T]he substantive law will identify which facts are material." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine issue of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. The pleadings, depositions, admissions, and affidavits, if any, must demonstrate that no genuine issue of material fact exists. FED. R. CIV. P. 56(c).
The disposition of a case through summary judgment "reinforces the purpose of the Rules, to achieve the just, speedy, and inexpensive determination of actions, and, when appropriate, affords a merciful end to litigation that would otherwise be lengthy and expensive." Fontenot v. Upjohn Company, 780 F.2d 1190, 1197 (5th Cir. 1986).
Once the movants make this showing, the nonmovant must then direct the court's attention to evidence in the record sufficient to establish that there is a genuine issue of material fact for trial. Celotex, 477 U.S. at 323-24. To carry this burden, the "opponent must do more than simply show . . . some metaphysical doubt as to the material facts." Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corporation, 475 U.S. 574, 586 (1986). Instead, the nonmovant must show that the evidence is sufficient to support a resolution of the factual issue in her favor. Anderson, 477 U.S. at 249.
While all of the evidence must be viewed in a light most favorable to the nonmovant, id. at 255 (citing Adickes v. S.H. Kress Company, 398 U.S. 144, 158-59 (1970)), neither conclusory allegations nor unsubstantiated assertions will satisfy the non-movant's summary judgment burden. Calbillo v. Cavender Oldsmobile, Inc., 288 F.3d 721, 725 (5th Cir. 2002) (citing Little v. Liquid Air Corporation, 37 F.3d 1069, 1075 (5th Cir. 1994) (en banc)). Summary judgment in favor of the movants is proper if, after adequate time for discovery, the motion's opponent fails to establish the existence of an element essential to her case and as to which she will bear the burden of proof at trial. Celotex, 477 U.S. at 322-23.
B. Standard of Review for Evaluating the Denial of Benefits
In the Fifth Circuit, an ERISA "plan administrator's factual determinations are always reviewed for abuse of discretion; but its construction of the meaning of plan terms or plan benefit entitlement provisions is reviewed de novo unless there is an express grant of discretionary authority in that respect, and if there is such then review of those decisions is also for abuse of discretion." Vercher v. Alexander Alexander Inc., 379 F.3d 222, 226 (5th Cir. 2004). In the instant case, Sedgwick, as plan administrator, has been given "full and exclusive authority and discretion to grant and deny claims under the Plan, including the power to interpret the Plan and determine the eligibility of any individual to participate in and receive benefits under the Plan." The Plan § 5.5.4, Defendants' Appendix at 271. Therefore, Sedgwick's interpretation of the plan, as well as its factual determinations made in the course of its denial of Talbert's claims, will be reviewed for abuse of discretion.
District courts in the Fifth Circuit may "employ a two-step analysis in determining whether a plan administrator abused its discretion in construing plan terms." Vercher, 379 F.3d at 227. First, the court must determine the legally correct interpretation of the plan and whether the administrator's interpretation accords with the proper legal interpretation. Id. If the court determines that the plan administrator's interpretation is legally sound, then "no abuse of discretion occurred and the inquiry ends." Id. If the administrator's interpretation does not comport with the court's legal interpretation, then the court must determine whether the administrator's interpretation constitutes an abuse of discretion. Id. at 227-28. Even if the court determines that a legally correct standard was applied, the court must still consider whether the administrator's factual determinations were an abuse of discretion. Id. at 231. The court is not required to use the two-prong test articulated above when, given the allegations and facts of the complaint, it is unnecessary. See Baker v. Metropolitan Life Insurance Company, 364 F.3d 624, 629 (5th Cir. 2004); Duhon v. Texaco, Inc., 15 F.3d 1302, 1307 n. 3 (5th Cir. 1994)
Talbert urges the court to utilize a three factor test similar to the one set forth in Lain v. UNUM Life Insurance Company of America, 279 F.3d 337, 346 (5th Cir. 2002), to determine whether Sedgwick interpreted the Plan in a legally correct manner. Talbert's Response ¶ 24. However, the crux of Talbert's argument that Sedgwick legally misinterpreted the Plan is that Barth and other agents of Sedgwick denied Talbert's claims because Talbert failed to provide sufficient medical support of disability. Id. The rejection of claims based on the absence of medical support is a factual determination, not an issue of contract interpretation. Meditrust Financial Services Corporation v. Sterling Chemicals, Inc., 168 F.3d 211, 214 (5th Cir. 1999). Thus, the court need only review, for an abuse of discretion, the factual determinations made by the defendants in their review of Talbert's claims.
A plan administrator abuses its discretion if it acts arbitrarily or capriciously. Meditrust, 168 F.3d at 214. When reviewing the administrator's decision for arbitrary and capricious actions resulting in an abuse of discretion, the court should affirm the administrator's decision if it is supported by "substantial evidence." Id. at 215. "A decision is arbitrary only if `made without a rational connection between the known facts and the decision or between the found facts and the evidence.'" Id. (citing Bellaire General Hospital v. Blue Cross Blue Shield, 97 F.3d 822, 828-29 (5th Cir. 1996).
Talbert asserts that the court should apply the "sliding scale" standard of review when reviewing Sedgwick's decision for abuse of discretion. Talbert's Response ¶¶ 20, 28. Where a conflict of interest exists, an administrator's decision to deny benefits should be given less deference than normal. Vega v. National Life Insurance Services, Inc., 188 F.3d 287, 299 (5th Cir. 1999). If the administrator is conflicted, the court should give "less deference to the administrator in proportion to the administrator's apparent conflict." Estate of Bratton v. National Union Fire Insurance Company of Pittsburgh, Pennsylvania, 215 F.3d 516, 521 n. 4 (5th Cir. 2000). Where a plaintiff has demonstrated only the minimal basis for a conflict and has failed to present any evidence with respect to the degree of conflict, the court should review the administrator's decision "with only a modicum less deference" than it otherwise would. Vega, 188 F.3d at 301.
In the instant controversy, the defendants argue that the sliding scale standard is inapplicable to Sedgwick's denial of benefits because Sedgwick is a third party administrator and SBC DIP is self insured. Defendants SBC DIP and Sedgwick's Reply to Plaintiff's Response to Defendants' Motion for Summary Judgment ("Defendants' Reply") at 3. In her response, Talbert alleges that a conflict exists because "most, if not all of the correspondence from the SMAART personnel bears the SBC logo . . ., and based on a review of the claim files, it appears there may be a fact issue that the claims review personnel are SBC employees." Talbert's Response ¶ 30. Viewing these arguments in a light most favorable to Talbert, it appears that she has alleged the minimal basis for a conflict; however, she has not provided sufficient evidence as to the degree of such conflict. Therefore, the court will review the denial of her claim for abuse of discretion with only a modicum less deference given to the defendants' decision. See Vega, 188 F.3d at 301.
C. Factual Determinations Made in Denying Talbert's Claim
Talbert asserts that the defendants abused their discretion in denying her claim because the diagnoses of Talbert's treating physicians were wholly ignored or discounted. Talbert's Response ¶ 29. According to Talbert, the defendants acted arbitrarily and capriciously in deferring to the opinions of "two non-doctor individuals," Barth and Williams, over the diagnoses of her treating physicians. Id. This generalization, however, is not supported by the record. While Talbert's claim was reviewed by two, "non-doctor," administrative employees, each of them relied on the opinions of medical professionals who reviewed Talbert's files. Defendants' Reply at 6. Specifically, the defendants rely heavily on the report of Greener, the physician reviewing Talbert's claim on administrative appeal. Defendants' Brief at 14. See generally Greener Report, Defendants' Appendix at 119-25.
In his report, Greener opined that Talbert was not permanently disabled, and could return to work at least part time. Id. at 5, Defendants' Appendix at 124. In reaching his conclusions, Greener reviewed Talbert's file and correspondence between the administrators and Ramos and Tulloch. Id. at 1, 5, Defendants' Appendix at 120, 124. Greener further provided, "[t]here is no objective evidence of cognitive impairment," and Greener cited Ramos' notes regarding Talbert's improvement in several aspects of her life. Id. Additionally, Greener found that neither Tulloch or Ramos submitted session notes that supported their findings of disability. Id. Thus, the opinions of Tulloch and Ramos were considered by the defendants; however, the defendants deferred to Greener in making the final determination.
Talbert further argues that the defendants abused their discretion by failing to have Dr. Greener personally examine Talbert. Id. ¶¶ 29, 31. This argument is without merit as the Plan does not require the administrators' physician to examine a claimant personally before denying her benefits. See generally the Plan. Special treatment is not afforded to the diagnoses of a claimant's treating physicians. Vercher, 379 F.3d at 233. Moreover, a plan administrator's decision is not arbitrary or capricious because it came down to a permissible choice between the claimant's physicians and independent reviewing physicians. See Id. at 232 (citing Sweatman v. Commercial Union Insurance Company, 39 F.3d 594, 602 (5th Cir. 1994), and Donato v. Metropolitan Life Insurance Company, 19 F.3d 375, 380 (7th Cir. 1994)). Additionally, the physician whose opinion forms the basis for the administrator's denial does not need to personally examine the claimant, rather reviewing the claimant's file is sufficient. See Vercher, 379 F.3d at 231-32 n. 12.
Additionally, Talbert asserts that Barth and Williams failed to "make any effort to obtain the information they deemed necessary to make a proper determination." Id. ¶ 29. However, it is not the burden of the administrator to compile evidence of disability; rather, the burden is on the claimant to submit evidence that supports her claim for benefits. See, e.g., Vega, 188 F.3d at 300.
There is substantial evidence in the record to establish that the decision to deny Talbert's claims is neither arbitrary or capricious. The existence of some evidence in the record that goes against the decision does not, in and of itself, cast doubt upon the defendants' discretion in denying Talbert's claims. Talbert has failed to point to evidence in the record that shows any abuse of discretion on the part of the defendants. Even if the administrator's decision is given less deference than normal, Greener's evaluation of Talbert's claim and file has not been attacked, nor has the plaintiff countered the defendants' reliance on Greener's opinion with sufficient evidence that would allow a reasonable factfinder to find in her favor. There is a rational connection between the decision to deny Talbert's benefits and the recommendation of Greener, which was based on all of the medical submissions regarding Talbert's claim. Therefore, Talbert has failed to establish a genuine issue of material fact relating to any abuse of discretion on the part of the defendants.
III. CONCLUSION
For the reasons stated above, the defendants' motion for summary judgment is GRANTED.
SO ORDERED.