Happy New Year to all our readers. Your ERISA Watch will be a little different for the next few months because our staff writer, Emily Payson, is on maternity leave with her first child (and the first grandchild for Your ERISA Watch co-editor Elizabeth Hopkins). We will continue to have a case of the week most weeks and will cover the most significant decisions but can’t promise to cover all decisions during this period. Thankfully, the year is off to a slow start so for our first issue of 2024, we will cover all six ERISA decisions that were reported within the last week.

Below is a summary of this past week’s notable ERISA decisions by subject matter and jurisdiction.

Disability Benefit Claims

Fourth Circuit

Weisman v. The Guardian Life Ins. Co. of Am., Civil Action No. 7:22-cv-00595, 2024 WL 65427 (W.D. Va. Jan. 5, 2024) (Judge Elizabeth K. Dillon). In a long-term disability decision that should surprise no one, the court granted summary judgment in favor of the plan participant, Dr. Joseph S. Weisman, who presented that he was disabled from being able to perform his work as a neuro-ophthalmologist and ophthalmic surgeon by a progressive neurological condition had led to uncontrollable tremors. Although Guardian approved Dr. Weisman’s claim for short-term disability benefits, it denied his claim for long-term benefits shortly thereafter on the basis that he did not seek treatment for his condition until after he stopped working and was no longer insured under the plan. As an initial matter, the parties disagreed about the applicable standard of review applicable to Guardian’s decision given that Guardian was late in deciding Dr. Weisman’s appeal, but the court concluded it need not resolve the issue. Instead, the court determined that even under a deferential standard, Guardian abused its discretion in denying benefits.  First, the court determined that Guardian was not correct that the plan required that Dr. Weisman be employed when he applied for benefits, only that he had to have become disabled while he was still employed. Second, the court concluded that whether or not Dr. Weisman met the policy requirement that he be under the regular care of a doctor during his disability was not relevant because the court agreed with Dr. Weisman that he had reached his maximum point of recovery and was still disabled. In this regard, the court relied on the opinion of one Dr. Cramer, who examined Dr. Weisman and stated that he had received the appropriate care for his disability. Finally, the court rejected Guardian’s contention that there was inadequate evidence that Dr. Weisman was disabled before he quit his job because he was self-evaluated (and treated) up to that point and only went to Dr. Cramer after he stopped working. The court noted that an insured’s subjective assessment of his own symptoms are relevant as a general matter to determining disability, and even more so when the insured is a doctor who is fully qualified to do so. Moreover, because Dr. Weisman’s assessment was fully supported by the opinion of Dr. Cramer, the fact that she gave her opinion after the fact did not support Guardian’s contention that it should be ignored and given no weight.

Life Insurance & AD&D Benefit Claims

Fifth Circuit

Haynes v. Principal Life Ins. Co., Civil Action No. 3:22-CV-2499-N, 2024 WL 56990 (N.D. Tex. Jan. 3, 2012) (Judge David C. Godbey). In this action claiming disability benefits, the court concluded that the preponderance of the evidence established that Plaintiff Angela Haynes is disabled within the terms of the plan and therefore granted her judgment on the record. Specifically, applying de novo review, the court determined that the medical record amply supported that Ms. Haynes suffered from Ehlers-Danlos Syndrome, which cause a number of symptoms including pain, fatigue, generalized and fluctuating weakness and brain fog, all of which caused her to be disabled from her occupation as an insurance agent. The court found this conclusion supported by her subjective reports of pain and by the conclusions of the social security administration in granting her disability benefits.

Eighth Circuit

Hogan v. Zuger Kirmis & Smith, PLLP, No. 1:23-cv-047, 2024 WL 38706 (D.N.D. Jan. 3, 2024) (Judge Daniel L. Hovland). Christine Hogan was denied life insurance benefits under an ERISA plan after the death of her husband Lawrence Dobson. She brought suit for benefits and fiduciary breach against Zuger Kirmis & Smith, the law firm that formerly employed Mr. Dobson and that sponsored the plan, and against Standard Insurance Company, which insured the plan. Although her husband left the Zuger in 2014, the firm continued to pay premiums on his behalf to Standard until his death in 2021. They also assured Ms. Hogan shortly after her husband’s death that he was “all paid up.” In fact, however, the governing policy stated that coverage automatically terminates at the end of employment. Unsurprisingly, Standard moved to dismiss, and the court granted its motion.  First, the court determined that Ms. Hogan was not entitled to benefits under the plain terms of the plan since her husband had long since ceased employment with Zuger. The court likewise rejected Ms. Hogan’s fiduciary breach claim against Standard, reasoning that estoppel was not available given the plain terms of the policy, Standard was not responsible for notifying the decedent that his coverage had terminated (and in fact had no way of knowing this), nor was it responsible for educating Zuger, the plan administrator, on its obligations.  The court therefore granted Standard’s motion to dismiss the claims against it, concluding that Ms. Hogan’s claims lie solely against the plan administrator.

Ninth Circuit

Principal Life Ins. Co. v. The Estate of Sergio Botello Diaz, No. 1:23-cv-00261-CDB, 2024 WL 35453 (E.D. Cal. Jan. 3, 2024) (Magistrate Judge Christopher D. Baker).In this interpleader action regarding the proper beneficiary of over $1 million in life insurance benefits, Plaintiff Principal Life Insurance Co. sought default judgment against Rogelio Botello Diaz, the son and named beneficiary of the covered plan participant, Sergio Botello Diaz. Principal filed the interpleader action because the elder Diaz was murdered, and the police have neither charged anyone nor cleared anyone in connection with the death.  Principal therefore concluded it could not pay the insurance benefits without peril to Rogelio, the named beneficiary.  And because Rogelio had not answered the complaint, Principal sought default judgment against him, to despot the insurance proceeds with the court (minus costs for Principal), and to then withdraw from the case. The magistrate judge assigned to the case concluded that the case was properly brought as an interpleader and that, despite the large sum of money at issue, that default was appropriate against Rogelio for failing to respond. The magistrate therefore recommended that a judge be assigned to the case and that default judgement be entered against Rogelio and that he be served with a copy of the decision.

Tenth Circuit

Jensen v. Life Ins. Co. of N. Am., Case No. 2:22-CV-293-DAK-DAO, 2024 WL 54433 (D. Utah January 4, 2024) (Judge Dale A. Kimball). This case concerns a life insurance claim by Jill Jensen, the wife and beneficiary of a man, Steven Jensen, who was determined in an autopsy to have accidentally died in his sleep from “oxycodone and clonazepam toxicity.” Mr. Jensen had been prescribed oxycodone for chronic pain and had been taking it, appropriately according to his doctor, for five years before his death.  Two days before his death, a psychiatrist he went to see for his anxiety prescribed him clonazepam and this combination of medically-prescribed drugs proved deadly. The policy governing the ERISA plan only provided benefits for accidental death and the insurance company (“LINA”) claimed that Mr. Jensen’s death did not qualify for two reasons: (1) LINA’s reviewing doctor concluded Mr. Jensen did not take the medications as prescribed and, as a result, overdosed on these medications; and (2) LINA claimed that because the medications which caused his death were prescribed to treat Mr. Jensen’s pain and anxiety, the death therefore came within the policy exclusion for death stemming from illness. LINA abandoned the first claim and only pressed the second in the district court. As an initial matter, the court determined that Utah’s ban on discretionary clauses applied, even though it was first passed eight years after the policy went into effect (but long before Mr. Jensen’s death). Although Utah law generally precludes retroactive application of substantive laws, the court agreed with Ms. Jensen that the law was a procedural change that could be applied retroactively to require de novo review of her claim for benefits which arose after the enactment of the law. However, even under that favorable standard, the court agreed with LINA that the policy unambiguously excluded coverage of the death, which arose from the treatment of illness.


Sixth Circuit

Walton v. The Guardian Life Ins. Co. of Am., No. 2:23-cv-1693, 2024 WL 47700 (S.D. Ohio Jan. 4, 2024) (Magistrate Judge Chelsey M. Vascura). Plaintiff Denise Walton filed suit for disability benefits against Guardian Life, the insurer for her ERIRA-governed disability plan, in the Southern District of Ohio, rather than in West Virginia where she worked and lived. Guardian moved to dismiss or transfer, claiming that venue was improper and alternatively sought discretionary transfer to West Virginia. The court agreed that venue was not proper in the Southern District of Ohio because the plan was not administered there, the breach did not take place there and because Guardian did not have minimum contacts with the district sufficient to reside or be found there for purposes of venue. Rather than dismiss, however, the court transferred the case to the Northern District of West Virginia.