Jennifer Dupre, et al v. Employee Benefit Services, et al

Filing 920100902


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Case: 09-30990 Document: 00511222991 Page: 1 Date Filed: 09/02/2010 IN THE UNITED STATES COURT OF APPEALS United States Court of Appeals FOR THE FIFTH CIRCUIT Fifth Circuit FILED N o . 09-30990 S u m m a r y Calendar September 2, 2010 Lyle W. Cayce Clerk J E N N I F E R DUPRE; DOUGLAS DUPRE, P la in t if f s - A p p e lle e s , versu s E M P L O Y E E BENEFIT SERVICES OF LOUISIANA, INC.; MANAGEMENT SEVEN, LLC, D e fe n d a n t s -A p p e lla n t s . A p p e a l from the United States District Court fo r the Western District of Louisiana N o . 2:07-CV-1552 B e fo r e DAVIS, SMITH, and SOUTHWICK, Circuit Judges. J E R R Y E. SMITH, Circuit Judge:* D e fe n d a n t s Employee Benefit Services of Louisiana, Inc. ("EBS"), and M a n a g e m e n t Seven, LLC ("Management Seven"), appeal a summary judgment Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. * Case: 09-30990 Document: 00511222991 Page: 2 Date Filed: 09/02/2010 No. 09-30990 in favor of plaintiffs Jennifer Dupre ("Dupre") and her husband, Douglas Dupre, a n d the denial of summary judgment to defendants. Concluding that the judgm e n t has no basis in law or fact and that there was no abuse of discretion by the a d m in is t r a t o r , we reverse and render judgment for defendants. I. D u p r e sought to have gastric bypass surgery, known as ROUX-En-Y, und e r the self-funded ERISA plan offered by her husband's employer. Dupre is c la s s ifie d as morbidly obese. At the time she requested the surgery, she suffered from myriad dysfunctions and diseases, including depression, sleep disturbances, s le e p apnea, dysfunctional uterine bleeding, urinary stress incontinence, osteoa r t h r itis , gastroesophageal reflux disease ("GERD"), and hypertension. M a n a g e m e n t Seven is the sponsor and plan administrator, EBS is the t h ir d -p a r t y administrator, and American Health Holdings ("AHH") was hired by M a n a g e m e n t Seven to provide medical review services before a claimant's rec e iv in g care. Dupre's request for gastric bypass surgery was initially denied by A H H as medically unnecessary. Upon appeal of that determination, however, A H H reversed its opinion and pre-certified the procedure. Importantly, in the p r e -c e r t ific a t io n letter, AHH stated, "This review is limited to medical necessity. Accordingly, this determination does not guarantee payment of charges. Payment of benefits will be subject to all of your health plan's conditions, lim it a t io n s , and exclusions affecting coverage . . . ." T h e pre-certification letter and Dupre's two doctors' opinions were sent to E B S for determination of coverage. One of her physicians, Dr. Bergstedt, wrote, " I n my opinion, this is . . . a logical next step for the patient, as she has exh a u s t e d all other methods of weight loss with no sustained success." Her other p h y s ic ia n , Dr. Shimer, wrote, "In my opinion, she would clearly benefit from the R o u x -E N Y bypass for surgical weight loss." Dupre's doctors also mentioned her 2 Case: 09-30990 Document: 00511222991 Page: 3 Date Filed: 09/02/2010 No. 09-30990 o t h e r ailments, and Bergstedt opined that the weight-loss surgery would allev ia t e some of those ailments. Shimer made no similar claims. T h e ERISA plan at issue explicitly grants the administrator authority to in t e r p r e t the plan.1 Upon receiving the request for coverage and the two medical o p in io n s , the administrator refused payment for the surgery because it is exclude d under Article VII, Paragraph 7.01 (MM) of the plan, which disallows coverage for "obesity, or in connection with obesity, weight reduction, or dietetic control." II. T h e Dupres sued Management Seven, Douglas Dupre's employer, EBS, a n d AHH (later voluntarily dismissed by plaintiffs). EBS and MGMT moved for s u m m a r y judgment, seeking to dismiss all claims. The district court denied the m o t io n and ordered that all benefits requested by Dupre were to be provided im m e d ia te ly . T h e Dupres moved for summary judgment, seeking a declaration that the g a s t r ic bypass surgery is covered by the plan. Dupre also sought attorneys' fees a n d costs. The district court granted summary judgment to the Dupres, allowing c o v e r a g e of the surgery, penalties under ERISA, and damages caused by the den ia l of benefits. Over the next few months, the parties filed various motions. Eventually, the district court denied defendants' motion to dismiss, mooted defe n d a n t s ' motion to stay, granted the Dupres' motion for entry of judgment, and d e n ie d their motion for attorneys' fees. "The plan administrator shall have full discretionary authority to interpret this plan and its provisions and regulations with regard to eligibility, benefit determination, and general administrative matters. The Plan Administrator's decision shall be binding on all Plan Participants and conclusive as to all questions of coverage under this Plan." Article XV, Section 15.01, Discretionary Authority of the Plan. [Doc. 24-3, R. 175]. 1 3 Case: 09-30990 Document: 00511222991 Page: 4 Date Filed: 09/02/2010 No. 09-30990 III. A. W e review a summary judgment de novo. Wade v. Hewlett-Packard Dev. C o ., 493 F.3d 533, 537 (5th Cir. 2007). The court's role at the summary judgm e n t stage is to determine only whether a genuine issue exists for trial and w h e t h e r the movant is entitled to judgment as a matter of law. Plyant v. Hartfo r d Life & Accident Ins. Co., 497 F.3d 536 (5th Cir. 2007) (citing Anderson v. L ib e r ty Lobby, Inc., 477 U.S. 242, 249 (1986)). A genuine issue of material fact e x is t s if evidence is such that a reasonable jury could return a verdict for the n o n -m o v in g party. Id. W h e r e a plan expressly confers discretion on the administrator to construe t h e plan's terms, the decision of the administrator is reviewed for abuse of disc r e t io n . Wade 493 F.3d at 537. We employ a two-step process to assess the adm in is t r a t o r 's decision. Plyant, 497 F.3d at 536. "In determining whether a E R I S A plan administrator abused its discretion in construing plan terms, a c o u r t first determines the legally correct interpretation of the plan and whether t h e administrator's interpretation accords with that interpretation." Id. "If a c o u r t concludes that a ERISA plan administrator has not given the plan the leg a lly correct interpretation, it then determines whether the administrator's int e r p r e t a t io n constitutes an abuse of discretion." Id. "A substantial factor in det e r m in in g whether the ERISA plan administrator's interpretation is a legally c o r r e c t interpretation is whether the interpretation is fair and reasonable." Id. I f an administrator's decision is supported by substantial evidence, the court m u s t affirm that decision. Id. at 539 (citing Ellis v. Liberty Life Assurance Co., 3 9 4 F.3d 262, 273 (5th Cir.2004)). Substantial evidence is evidence that a reas o n a b le mind might accept as sufficient to support the conclusion. Wade, 493 F .3 d at 541. 4 Case: 09-30990 Document: 00511222991 Page: 5 Date Filed: 09/02/2010 No. 09-30990 B. A s we have said, the administrator based his decision on Article VII, Sect io n 7.01 MM of the plan, which says that "[n]o benefits are provided under this p la n for expenses incurred for or in connection with: . . . [o]besity, or in connect io n with obesity, weight reduction, or dietetic control." The plain language of t h e plan, therefore, shows that the administrator may deny benefits for a surg e r y connected to weight loss. D u p r e cites Hansen v. Actuarial & Employee Benefit Services Co., 395 F . Supp. 2d 881 (D.S.D. 2005), to support her argument that the district court's d e c is io n to overrule the plan administrator was correct. Hansen, however, is e a s ily distinguished. There the administrator blatantly misrepresented the m e d ic a l facts in order to find an exclusion. In an attempt to exclude the requeste d gastric bypass surgery, the administrator claimed that the plaintiff had failed to seek less invasive treatments. That claim was contradicted by the reco r d , which the administrator either failed to review or chose to misrepresent. The court found that the administrator's decision was arbitrary and capricious a n d stated that "[i]n making its decision, the administrator completely failed to e v a lu a te the facts to determine whether the treatment was excluded under the P la n ." Hansen 395 F. Supp. 2d at 890-91. Therefore, substantial evidence did n o t support that administrator's decision. D e s p ite the fact that both involve gastric bypass surgery, the instant case b e a r s little resemblance to Hansen. Here, the administrator evaluated the facts in both physicians' letters and concluded that the surgery was not a last resort fo r treating GERD or some other disorder. Instead, he found that it was des ig n e d to help Dupre lose weight. More importantly, unlike the situation in H a n s e n , there is no evidence of blatant misrepresentation. T h e district court erred in substituting its own judgment for that of the adm in is t r a t o r . A reasonable interpretation of the plan, as the district court stated, 5 Case: 09-30990 Document: 00511222991 Page: 6 Date Filed: 09/02/2010 No. 09-30990 c o u ld find that gastric bypass surgery is not connected to obesity, weight red u c tio n , or dietetic control. The administrator's reasonable interpretation of the p la n , however, found that gastric bypass surgery is connected to obesity and w e ig h t reduction. We defer to the administrator's judgment. Wade 493 F.3d at 5 4 1 ; Ellis 394 F.3d at 273. He made his determination after considering all the r e le v a n t evidence, including the two letters provided by the physicians. We uph o ld an administrator's decision if it is sufficiently supported by evidence. Plya n t, 497 F.3d at 539. W e need not address the potential conflict of interest urged by Dupre. As t h e defendants point out, that matter was not raised in the district court. Issues p r e s e n t e d for the first time on appeal are waived.2 T h e judgment in favor of the Dupres is REVERSED, and judgment is RENDERED in favor of the defendants. See, e.g., Tex. Commercial Energy v. TXU Energy, Inc., 413 F.3d 503, 510 (5th Cir. 2005) (stating that arguments not raised in district court are waived"). 2 6

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