Disability Benefit Claims

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The New Year is off to an exciting start with two noteworthy appellate decisions, one favorable to a plan participant and one favorable to a plan sponsor. First up is a case in which the Eighth Circuit reversed a denial of disability benefits to a long-term recipient of such benefits: Roehr v. Sun Life Assurance Co. of Canada, No. 21-1559, __ F.4th __, 2021 WL 6109959 (8th Cir. Dec. 27, 2021) (Before Circuit Judges Kelly, Erickson, and Grasz). 

Insurers who are stuck with long-term expensive disability claims are often looking for ways to get rid of them. However, in this new decision from the Eighth Circuit, the court has warned insurers that they must be careful in how they deny those claims. While an insurer is not obligated to keep paying benefits just because it has done so in the past, it needs to have a good explanation for reversing itself, especially if it has been paying for almost a decade and the medical evidence has remained largely unchanged.
Continue Reading Eighth Circuit Warns Disability Administrators to Think Twice Before Terminating Disability Benefits, While Eleventh Circuit Allows Employer to Terminate Life Insurance Benefits Despite Written and Oral Promises That Such Benefits Would be Maintained

Thompson v. Oracle Corp., No. 4:21-cv-00026-YGR, 2021 WL 5865519 (N.D. Cal. Dec. 10, 2021) (Judge Yvonne Gonzalez Rogers). 

When Elisa Thompson went to work for Sun Microsystems, she specifically negotiated a job offer that included a guarantee of lifetime disability benefits because she was concerned about the possible return of a childhood disability. When Oracle Corporation, which had acquired Sun Microsystems, reneged on this promise following an amendment to the company’s disability policy, Ms. Thompson filed suit asserting claims under state law – for breach of contract, promissory estoppel, fraudulent and negligent misrepresentation and elder abuse – and under ERISA for benefits and fiduciary breach.  Oracle moved to dismiss three of the state-law claims and both of the ERISA claims.
Continue Reading State-Law Claims for Lifetime Disability Benefits Survive While ERISA Claims Are Dismissed

ERISA Watch has two highlights this week: one is a win by a disabled plan participant, represented by Kantor & Kantor, at the Fourth Circuit, and the other is an examination of Monday’s argument at the Supreme Court in Hughes v. Northwestern.

Shupe v. Hartford Life & Accident Ins. Co., No. 19-1854, __ F.4th __, 2021 WL 5774728 (4th Cir. Dec. 7, 2021) (Before Circuit Judges Wilkinson, Agee, and Floyd).

Robert Shupe was an Executive Sous Chef for the Hyatt Corporation in San Diego. In 2003 he began experiencing symptoms of osteomyelitis, an infection in his spinal cord. He sought treatment, but nothing was effective and in 2004 he was forced to stop working. He submitted a claim to Hartford, the insurer of Hyatt’s long-term disability benefit plan, which approved his claim.
Continue Reading A Victory for a Disabled Plan Participant at the Fourth Circuit, and a Summary of the Supreme Court Argument in Hughes v. Northwestern