Criss v. Assurant Inc. et al

Filing 29

MEMORANDUM OPINION AND ORDER This case is appropriate for mediation; unless within two weeks, the parties agree to mediation in accordance with this courts Alternative Dispute Resolution Plan, the court will remand the dispute to the plan administra tor, who will be charged with obtaining answers to the questions outlined within, and who shall provide a full and fair administrative review. The court shall expect this new review to be completed and a final decision rendered within ninety days. Signed by Judge William M Acker, Jr on 6/11/14. (SAC )

FILED
2014 Jun-11 PM 01:36
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
KAREN CRISS,

}
}
}
}
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}
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}
}

Plaintiff,
v.
UNION SECURITY INSURANCE
COMPANY,
Defendant.

CIVIL ACTION NO.
2:13-cv-0685-WMA

MEMORANDUM OPINION AND ORDER
Prologue
This court devoutly wishes that the Supreme Court of the
United States had not blindly stumbled off on the wrong foot and in
the wrong direction when it handed down Firestone Tire & Rubber Co.
v. Bruch, 49 U.S. 101 (1989), the case in which it invented a
strange quasi-administrative regime for court review of denials of
ERISA benefits claims.
borrowed

from

It inexplicably substituted a procedure

administrative

law

for

the

clear

congressional

mandate that the filing of a “civil action” (a simple, straightforward, garden-variety suit for breach of contract) is the only
means for challenging such denial decisions.

In the amicus curiae

brief filed by the Solicitor General in Bruch, he did his best to
keep the Supreme Court from wandering off track and ignoring
Congress.

The

Solicitor

General,

who

was

representing

both

Congress and the persons whom Congress intended to benefit from
ERISA, failed to talk the Supreme Court out of its misguided step,

a misstep that has led to a series of further judicial glosses,
distillations, penumbras, and emanations, eventuating in the sad
state of affairs now faced by ERISA claimants and by the courts who
have to deal with ERISA benefits claims.
If Congress itself had enacted the weird scheme created by the
Bruch court out of whole cloth, ERISA would have been promptly and
successfully attacked for its patent unconstitutionality as a
violation of “due process”. A quick application of the universally
recognized legal maxim, nemo judex in causa sua, would have kept
any such statute off the statute books.

Chief Justice Sir Edward

Coke in Dr. Bonham’s Case, 8 Co. Rep. 107a, 77 Eng. Rep. 638 (C.P.
1610),

carved

in

granite

for

all

time

this

fundamental

jurisprudential principle when he said, using the vernacular:

“No

man should be a judge in his own case.”
The justices of the Supreme Court, including some who decided
Bruch, routinely recuse themselves when there is even the slightest
hint of any possible self-interest by the recusing justice.

And

yet,

and

today,

clearly

conflicted

ERISA

plan

administrators

insurers, when granted by the plan document that they drafted full
discretion to interpret their plans and to decide the ultimate
issue of entitlement, are routinely allowed, even required, to rule
on their own cases.

Not surprisingly, this court has not found a

single case in which an insurance company has recused itself in an
ERISA case under the rule of nemo judex in causa sua.
2

There is no

scheme remotely like the one created by Bruch in the annals of
Anglo-American jurisprudence.

Chief Justice Coke is uncomfortable

in his crypt.
While in the above three paragraphs this court has been
indulging in wishful thinking, the court is now brought back to
earth by the knowledge that it cannot alter or ignore the actual
state of

ERISA

jurisprudence,

as

it has

evolved

from

Bruch.

Especially, this court cannot alter or ignore what the Eleventh
Circuit has done to produce its own sui generis brand of fruit from
the poisoned tree.
In Brown v. Blue Cross & Blue Shield of Alabama, Inc., 898
F.2d 556 (1990), the Eleventh Circuit acknowledged the binding
effect of the Bruch-created “arbitrary and capricious” standard for
reviewing the decisions of ERISA decision-makers who have granted
themselves Bruch discretion.
also

recognized

that

the

But, in Brown, the Eleventh Circuit
Bruch

Frankenstein that it has come to be.

regime

could

lead

to

the

The Eleventh Circuit issued

its warning to itself and to others, in the following remarkable,
but unmistakable language:
Because we have restated the standard as arbitrary and
capricious, the temptation exists to consult precedent
regarding
the
use
of
that
standard
to
review
administrative agency decisions.
See e.g., Jett, 890
F.2d at 1141-42 (Johnson. J., concurring and dissenting)
(citing and quoting from Motor Vehicle Mfrs. Ass’n v.
State Farm Auto Ins. Co., 463 U.S. 29, 103 S.Ct. 2856, 77
L.Ed.2d 443 (1983)). In some instances an overlap is
evident.
Compare, e.g., id. (extracting duty to
3

investigate from Motor Vehicle Mfrs. Ass’n) with Jader,
723 F.Supp. at 1342-43; Slover, 714 F.Supp. at 832-33;
Teeter v. Supplemental Pension Plan, 705 F.Supp. 1089,
1095 (E.D. Pa.1989) (fiduciary has affirmative duty to
gather information bearing on beneficiary’s claim that is
reasonably obtainable). We express caution, however, at
wholesale importation of administrative agency concepts
into the review of ERISA fiduciary decisions. Use of the
administrative agency analogy may, ironically, give too
much deference to ERISA fiduciaries. Decisions in the
ERISA context involve the interpretation of contractual
entitlements; they “are not discretionary in the sense,
familiar from administrative law, of decisions that make
policy under a broad grant of delegated powers.” Van
Boxel, 836 F.2d at 1050. Moreover, the individuals who
occupy the position of ERISA fiduciaries are less wellinsulated from outside pressures than are decisionmakers
at government agencies. See Maggard, 671 F.2d at 571.
We therefore concentrate on the common law trust
principles to evaluate the application of the arbitrary
and capricious standard. Of course, the common law we
consider includes the cases decided under the Labor
Management Relations Act.
See, e.g., Sharron v.
Amalgamated Ins. Agency Servs., Inc., 704 F.2d 562 (11th
Cir.1983)
(decided
under
LMRA,
not
ERISA,
but
subsequently applied to ERISA situations).
Brown, 898 F.2d at 564 n.7.
down the

Eleventh

Circuit

This ominous footnote did not slow
in

its

march

toward

achieving the

reputation as the circuit court of appeals least likely to rule
against a plan administrator or an insurer.
In response to Bruch, an increasing number of states have
adopted a statute or insurance industry rule that precludes the
inclusion of the so-called “discretionary clause” in a disability
insurance policy.

These states have wisely slipped the embrace of

Bruch and have accomplished in their states what Congress intended,
namely, trials de novo for beneficiaries after they have been

4

denied and unsuccessfully exhausted their internal plan remedies.
Alabama, Georgia, and Florida have not seen fit to take advantage
of this means for escaping Bruch.

Meanwhile, the Eleventh Circuit

has created its “six-step” analysis, which puts plan administrators
and insurers firmly in the driver’s seat, and invites them to sit
in judgment on their own denial decisions, and to ignore, as if
meaningless, their fiduciary obligations of strict loyalty to their
plan beneficiaries.
So, What About the Above-Captioned Case?
Plaintiff, Karen Criss (“Criss” or “plaintiff”), brings this
action seeking benefits she claims are owed her under a long-term
disability insurance plan provided by her employer, HeartSouth
Cardiovascular Group (“HeartSouth”), and insured by defendant,
Union Security Insurance Company (“Union Security” or “defendant”).
Before the

court

are cross-motions

supporting memoranda.

for

summary

judgment1

and

This court has in earlier opinions made

known its belief that Rule 56 does not fit ERISA cases as long as
Bruch provides the method for review, but this court “goes along to
get along.”

1

Defendant’s motion is styled as a “motion for judgment on the
pleadings.”
(Doc. 15).
Because defendant relies on materials
outside the pleadings, the court construes the motion as a motion
for summary judgment. See Fed. R. Civ. Pro. 12(c)-(d).
5

Factual Background
Plaintiff is 57 years old.

From January, 2003 to February,

2008, she worked as a financial clerk for HeartSouth.

R. at 139.

As part of her employment package, she was insured under the
disability insurance policy that is at issue in the instant action
and that covered physicians, administrators, and clerks.

Id.

As early as 1993, Criss was diagnosed with fibromyalgia, a
disorder of unknown cause that causes widespread and severe pain,
fatigue, sleep loss, and mood swings.

R. at 502.

Criss’s medical

records deal mostly with treatment she received after 2006.

These

records reflect that she saw no fewer than six doctors in 2006 and
2007 for her fibromyalgia and other medical conditions, including
neuropathy (a disease similar to fibromyalgia that involves general
pain and weakness in the extremities).

The doctors achieved only

partial success in treating Criss’s various ailments by increasing
or reducing her medications.

See, e.g., R. at 1107.

A November,

2007 doctor’s report noted that “[s]he has quit all vitamins, antidepressants, Synthroid in the last 3 weeks and now ‘I feel better
than I have before’”.

Id.

But, her above-mentioned symptoms were

never eliminated or ameliorated to the point of a release from pain
or from treatment.
On an afternoon in February, 2008, Criss suddenly left work in
the middle of the day in what would turn out to be a permanent

6

departure.

A claims agent for Union Security interviewed her in

the following month and summarized what she found as follows:
There was an incident and build up of exhausting her self
[sic] at work, new computer system at work, not
sufficient training, they had to stop what they were
doing, go out to the internet and get the training as
they needed, she couldn’t get the training she needed,
“hands on” kind of person, she couldn’t understand these
foreigner people that she couldn’t understand, she had
deadlines, she had a panic attack, she felt she was going
to explode, she ran into her bosses [sic] office, she
told the boss she had to go and she ran out of the
building.
R. at 1090.

Criss tried to return to work, but upon doing so, she

had “panic attacks, [would] break out in hot sweat, her chest
[would have a] screw where the screwdriver keeps tightening it up
to about 100 pound weight, [and] she [would have] palpitations . .
. .”

Id.
In the wake of what can only be described as a nervous

breakdown, Criss continued to see her treating doctors, and added
a host of new doctors, both for treatment and for evaluation of her
possible disability status.

These medical consultations included

partial hospitalization

an

in

“Intensive

Outpatient

Program,”

during which she was treated for “major depression, panic attacks
and work stress.”

R. at 1016.

She continued to receive treatment

for her pain-related illnesses such as fibromyalgia and neuropathy.
See, e.g., R. at 779-80 (April 2008 treatment notes indicating
“very symptomatic” fibromyalgia).

7

Criss filed her disability claim with Union Security in April,
2008, citing “anxiety, panic disorder, depression, severe pain,
fibromyalgia,

neuropathy,

(emphasis added).

[and]

carpal

tunnel.”

R.

at

1096

Defendant happily approved the claim, and began

paying Criss benefits. R. at 165-69. However, defendant explained
in its approval letter that Criss was required to file a disability
claim with the Social Security Administration (“SSA”), so that
defendant could offset its payments to Criss by any amounts awarded
by the SSA.

R. at 166.

Criss complied with defendant’s demand,

and the SSA granted her application for benefits in May, 2009, R.
at 940-41, whereupon Criss refunded to defendant a significant
amount of money, R. at 916-17.
In

2010,

defendant

cut

off

plaintiff’s

benefits.

In

accordance with the plan’s procedures, Criss appealed defendant’s
decision.
2010.

Defendant finally denied Criss’s appeal on November 30,

R. at 470-76.

It is this denial that plaintiff challenges

in the above-styled quasi-administrative proceeding.
The Six-Part Test
The first step in the Eleventh Circuit’s super-unique six-step
test requires the court to apply “the de novo standard to determine
whether the
‘wrong’

claim

(i.e.,

decision)”.

administrator's

the

court

benefits-denial

disagrees

with

the

decision

is

administrator's

Blankenship v. MetLife Ins. Co., 644 F.3d 1350, 1355

(11th Cir. 2011).

Only if the court determines that the decision
8

was de novo correct does the court go to “step two”, or beyond.
This

court

is

stymied,

finding

it

impossible

to

make

the

determination required by “step one”, because the record does not
provide evidence upon which this court can reasonably and fairly
reach a de novo decision.
Procedural Correctness Required
No matter whether it is ultimately determined that defendant’s
denial decision was “correct”, that determination can come only
after

the

plan

administrator

has

fulfilled

the

“fundamental

requirement that [its] decision to deny benefits [is] based on a
complete administrative record that is the product of a fair
claim-evaluation process.”

Melech v. Life Ins. Co. of N. Am., 739

F.3d 663, 676 (11th Cir. 2014) (emphasis added).

Thus, if Union

Security, the plan administrator, has made a decision without a
complete administrative record, or without a fair claim-evaluation
process, “the proper course of action [for a court] is to remand
[to the plan administrator].”

Id. at 675 (emphasis added).

This court detects at least two procedural shortcomings that
require a remand of this dispute to the plan administrator as
required by Melech.

9

I
Drawing the Line Between Disabling
Physical Ailments and a Disabling
Combination of Physical and Mental Ailments
The following plan language is crucial to a resolution of this
dispute:
We pay only a limited benefit for a period of disability
due to alcoholism, drug addiction, chemical dependency
and mental illness. The Maximum Benefit Period for all
such periods of disability is 24 months. . . .
Your period of disability will be considered due to
alcoholism, drug addiction, chemical dependency or mental
illness if:
- you are limited by one or more of the stated
conditions; and
- you do not have other conditions which, in the
absence of the stated conditions, would continue to
exist, limit your activities, and lead us to conclude
that you were disabled.
R. at 24 (emphasis added).

This language, drafted by defendant,

creates a very difficult fact-finding regime.

Whether the fact-

finder is the structurally conflicted payor, or is this court upon
de novo consideration (as required by “step one”), the inquiry is
whether plaintiff’s serious physical problems, divorced from her
mental problems that are largely symptomatic of her physical
problems, render her unemployable.

The parties did not recognize

or adequately address this factual and semantic problem, either
during Criss’s 24-month period of mental illness, during which
plaintiff

was

admittedly

entitled

thereafter.
10

to

disability

benefits,

or

It does not take the dean of Johns Hopkins School of Medicine
to know that there is a link between the functioning of the human
brain and the well-being of the rest of the body, although that
connection is not easy to explain or describe.

Any person who is

in constant pain becomes, at least to some extent, “anxious” (the
word from which the word “anxiety” derives).
person has a mental problem.

An overly anxious

In circumstances involving a myriad

of medical problems like those in this case, it may be impossible
to

draw

the

line

contemplated

by

this

policy

language.

No

physician, with the possible exception of the hereinafter mentioned
Dr. Fleeson, has been asked a question that elicits his opinion as
to whether he has the tools to even answer the ultimate question,
and, if so, to give the right answer.

The ultimate question of

whether Criss’s physical ailments alone disabled her becomes close
to

being

Plaintiff,

an
who

academic,
has

never

theoretical,
been

called

hypothetical

question.

a

obviously

charlatan,

believes that her physical ailments alone act to prevent her from
working at any job, sedentary or not.

Except for Dr. Fleeson, the

doctor who was hired by defendant during Criss’s first appeal,
nobody has attempted to distinguish the period of time, if any,
during which plaintiff’s physical disabilities alone rendered her
“disabled”, and the period during which a combination of her mental
and physical disabilities rendered her “disabled”.

Dr. Fleeson

concluded that for 38 days during the 24 months of plaintiff’s

11

conceded mental illness, she was so physically disabled that she
was “disabled”, without regard to the fact that she was at the same
time mentally disabled.

The court expressly asked counsel for

defendant to explain Dr. Fleeson’s rationale for this conclusion.
In response to the court’s inquiry, defendant undertook to explain
these 38 days as follows:
Certain
acute
conditions
constituted
disability for a limited period of time.

a

separate

During the first appeal, Union Security obtained an
independent medical review from William P. Fleeson, M.D.,
M.P.H. (US000529-US000556).
During that review, Dr.
Fleeson identified a total of 38 days during which he
believed Plaintiff would have been physically disabled
from sedentary work due to three different acute
conditions: (1) 14 days for carpal tunnel syndrome in
September 2008; (2) 21 days for thoracic and lumbar spine
degenerative disc disease in July and August 2008; and
(3) 3 days for shoulder impingement syndrome in January
2009. (US000540-41, US000544). Dr. Fleeson based these
determinations on his evaluation of the medical records
and by referencing The Medical Disability Advisor, which
Dr. Fleeson states is a nationally-recognized and peerreviewed authority on medical conditions and their
associated recovery period and time away from work.
(US000539).
Based on Dr. Fleeson’s finding of 38 days of complete
disability due to physical conditions, Union Security
paid Plaintiff an additional 38 days of disability
benefits. The 24-month mental illness limitation does
not apply to any periods in which Plaintiff also was
completely
disabled
due
to
physical
conditions.
Therefore, the 24 month limitation did not apply to the
prior 38 days in which Union Security found that
Plaintiff was physically disabled.
Accordingly,
Plaintiff’s benefits period was extended by 38 days, from
May 27, 2010 through July 4, 2010. (US000517).

12

Apparently Dr. Fleeson was specifically asked to employ the
policy language as to whether Criss had any “other conditions
which, in the absence of the stated condition [mental illness],
would . . . limit [her] activities and lead us to conclude that
[she was] disabled”.
this policy
defendant

He apparently understood the importance of

language.

or

hired

No

by

other

physician,

plaintiff,

has

been

whether
asked,

hired by
much

less

attempted to answer, this question.
Dr. Fleeson, whose credibility is in question, discounts and
downplays Criss’s “fibromyalgia” and “neuropathy” as non-acute
conditions,

apparently

unlike

“carpal

tunnel,”

or

“spine

degenerative disease”, or “shoulder impingement”, which, in and of
themselves, or in combination, according to him, rendered Criss
totally unemployable.

The record does not reflect whether Criss

still has carpal tunnel, and/or degeneration of her thoracic and
lumber

discs,

and/or

shoulder

impingement.

Has

she

totally

recovered from these “acute”, disabling physical ailments? Neither
a

non-treating

physician,

nor

a

treating

physician,

nor

a

vocational expert has provided opinion evidence upon which this
court, as a de novo fact-finder, can conclude that a 57-year-old
woman with severe fibromyalgia and neuropathy, carpal tunnel,
degenerative

disc

disease

and

shoulder

impingement,

can

find

gainful employment and fulfill the duties of an available job.
Incidentally,

while

Dr.

Fleeson
13

was

discussing

the

clinical

presentation of fibromyalgia, he noted that “[a]t least 17 other
medical and psychiatric conditions have considerable clinical and
symptomatic overlap with [fibromyalgia].”
added).

R. at 542 (emphasis

In other words, even Dr. Fleeson may find it difficult to

draw a line between fibromyalgia and mental illness.
him, one may imply the other.

According to

Is this a Catch-22?
II

Do Plaintiff’s Physical Problems Alone Meet
the Plan’s Definition of “Disability”?
Central to this or to any other ERISA disability claim is the
plan’s definition of “disability”. The court has already discussed
that portion of Union Security’s insurance policy that would
preclude liability for “mental illness” after 24 months. The terms
of this policy that define “disability” are complicated, but
understanding them is necessary to a decision.

The pertinent

language is as follows:
DEFINITIONS FOR LONG TERM DISABILITY INSURANCE
* * * * *
Disability or disabled means that in a particular month,
you satisfy one or more of the three Tests, as described
below.
* * * * *
Occupation Test (For each All other Employees)
•

during the first 24 months of a period of
disability (including the qualifying period),
an injury, sickness, or pregnancy requires
14

that you be under the regular care and
attendance of a doctor, and prevents you from
performing at least one of the material duties
of your regular occupation; and
•

after 24 months of disability, an injury,
sickness, or pregnancy prevents you from
performing at least one of the material duties
of each gainful occupation for which your
education, training, and experience qualifies
you.

If during the first 24 months of a period of disability
(including the qualifying period), you can perform the
material duties of your regular occupation with
reasonable accommodation(s), you will not be considered
disabled. If, after 24 months of a period of disability,
you can perform a gainful occupation for which your
education, training, and experience qualifies you, with
reasonable accommodation(s), you will not be considered
disabled.
The inability to perform a material duty
because
of
the
discontinuance
of
reasonable
accommodation(s) on the part of the employer does not, in
itself, constitute disability.
* * * * *
Gainful occupation means an occupation in which you could
reasonably be expected to earn at least as much as your
Schedule Amount within 12 months of your return to work.
* * * * *
Schedule Amount: 60% of monthly pay subject to a maximum
Schedule Amount of $15,000 per month, except as stated in
Proof of Loss provision.
(italics in original, bolding added).
This

language

raises

the

R. at 5-7.

following

questions,

as

yet

unanswered:
(1)

Assuming with Dr. Fleeson “that in a particular month”

(in fact, four months, September of 2008, July of 2008, August of
15

2008, and January of 2009), Criss satisfied one of Union Security’s
tests, without regard to her mental condition, was she “disabled”
for each of those entire four months or just for the few days found
by Dr. Fleeson?
(2)

Does contra proferentem apply to assist in the resolution

of the ambiguities in this plan language?

See White v. Coca-Cola

Co., 542 F.3d 848 (11th Cir. 2008).
(3)

After the first 24 months expired, did any of Criss’s

“sicknesses” prevent her from performing a “gainful occupation” for
which her “education, training and experience” qualified her?
(4)

What was Criss’s education, training and experience?

(5)

Can Criss perform any occupation for which she could

reasonably expect to earn “at least as much as [her] Schedule
Amount within 12 months of [her] return to work” when Criss is not
returning to work?
(6)

What was Criss’s salary when she was working?

(7)

What is the job market for a 57-year-old woman with

severe pain, fibromyalgia, neuropathy, carpal tunnel, disc disease,
and shoulder impingement?
(8) Can witnesses other than Dr. Fleeson, including Criss
herself, express opinions as to what particular days in what
particular months Criss was totally disabled by physical ailments
divorced from mental illness?

16

Despite the fact that the Eleventh Circuit routinely gives
plan administrators the benefit of the doubt, the Eleventh Circuit
is literally the leader in recognizing that a disability claimant
does not have to be a blind paraplegic in order to be “disabled”
within the meaning of that word in a benefits plan.
of circumstances must be considered.
Inc.,

728

addressed

F.2d
the

impression.

1416

(11th

question

Cir.

which

at

The totality

In Helms v. Monsanto Co.,

1984),
that

the

time

Eleventh
was

one

Circuit
of

first

What the Eleventh Circuit there held deserves a

quotation at length:
Dr. Skalka’s deposition was taken in November, 1982, in
preparation for trial.
He was asked by appellant’s
counsel to explain his reasoning as to why he concluded
that Mr. Helms was not totally and permanently disabled.
He responded:
Well, I felt that Mr. Helms was certainly disabled, but,
according to that definition, with that word, ‘any
occupation or employment for remuneration or profit,’ I
really couldn’t think of any disability compatible with
conscious life that would allow me to say anybody was
‘disabled within the definition set out above,’ so I had
to sign it, ‘Not disabled within the definition.’
Skalka’s Deposition at 21-22.
The district court concluded that Dr. Skalka did not act
arbitrarily and capriciously in reaching his decision and
therefore Monsanto had properly denied Mr. Helms the
benefits. The sole issue before this court is whether
the arbitrator was arbitrary and capricious in finding
that appellant was not disabled because permanent total
disability is inconsistent with conscious human life. We
find that the arbitrator applied the wrong standard to
determine permanent total disability and therefore
reverse and remand for further proceedings consistent
with this opinion.
17

* * * * *
There is no particular provision in ERISA nor could we
find any federal case which specifically dealt with the
issue presented here. However, under ERISA’s legislative
scheme, this court is empowered to formulate rules of law
to govern various aspects of the employee benefit field.
As Congress pointed out, “[I]t is also intended that a
body of law will be developed by the courts to deal with
issues involving rights and obligations under private
welfare and pension plans.”
120 Cong.Rec. 515, 751
(daily ed. August 22, 1974). Yet, in formulating these
laws courts must be guided by the general policies
underlying ERISA. The general objective of this Act is
to increase the number of individuals in employerfinanced benefit plans. Congress wanted to assure that
those who participate in the plans actually receive the
benefits they are entitled to and do not lose these as a
result of unduly restrictive provisions or lack of
sufficient funds. H.R.Rep. No. 93-807, 93rd Cong., 2nd
Sess. 3, reprinted in 1974 U.S. Code Cong. & Ad.News
4639, 4670, 4676-77.
Total disability under this type of provision is not
considered to exist if the insured can follow any
remunerative occupation, whether in his present vocation
or another. The phrase should not be given an absolute
and literal interpretation. It should not mean that the
affected individual must be utterly helpless to be
considered disabled. It must be a relative term which
means that the individual is unable to engage in a
remunerative occupation or to do work in some profitable
employment or enterprise.
Permanent disability is a
question of fact that depends upon all the circumstances
of a particular case. Bearing in mind, we turn to the
arbitrator’s construction of the clause in this case.
Dr. Skalka’s decision must be upheld on review unless it
is arbitrary and capricious. (citations omitted). Dr.
Skalka’s interpretation of the DIP was arbitrary and
capricious. By his own words, a finding of permanent
disability would only be possible if the individual had
no “conscious life.” Such a standard would render the
entire Monsanto DIP totally meaningless.
Recognizing
this is a difficult area, we will set forth the
appropriate standard.

18

In order to determine when a Monsanto employee will be
considered to be totally and permanently disabled under
the provisions of the DIP we must define the phrase any
occupation or employment for remuneration or profit.” It
is difficult to do this because a person would almost
never be deprived of the ability to earn a nominal sum
unless he is rendered completely immobile and without
cognitive ability. In order to establish a reasonable
interpretation of this phrase we turned for guidance to
insurance policies with similar provisions and to cases
construing the Social Security disability provisions.
Analogous insurance cases consistently agree that the
term
“total disability”
does
not
mean absolute
helplessness on the part of the insured. The insured can
recover benefits if he is unable to perform all the
substantial
and
material acts
necessary
to
the
prosecution of some gainful business or occupation.
Gainful has been defined by these courts as profitable,
advantageous or lucrative. Therefore, the remuneration
must be something reasonably substantial rather than a
mere nominal profit. (citations omitted).
* * * * *
Common knowledge of the occupations in the lives of men
and women teach us that there is scarcely any kind of
disability that prevents them from following some
vocation or other, except in cases of complete mental
incapacity.
Although the achievements of disabled
persons have been remarkable, we will not adopt a strict,
literal construction of such a provision which would deny
benefits to the disabled if he should engage in some
minimal occupation, such as selling peanuts or pencils,
which would yield on a pittance. The insured is not to
be deemed “able” merely because it is shown that he could
perform some task.
Neither will we adopt the definition used by the
arbitrator in this case. He believed that anyone alive
and conscious would not qualify for benefits under the
Monsanto plan.
The word disability is not ordinarily
used to describe death, although death is undeniably the
ultimate disability.
To bar recovery, under the provisions of the DIP, the
earnings possible must approach the dignity of a
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livelihood.
Mr. Helms is required to show physical
inability to follow any occupation from which he could
earn a reasonably substantial income rising to the
dignity of a income or livelihood, even though the income
is not as much as he earned before the disability. See,
e.g., Mutual Life Ins. Co. v. Bryant, 296 Ky. 815, 177
S.W..2d 588 (1943). The arbitrator in this case applied
the wrong standard. We reverse and remand so that the
arbitrator can allow development of all appropriate
evidence for consideration under the correct standard.
Id. at 1419-22 (emphasis added).
Other courts have taken up the Eleventh Circuit’s theme.

In

Torix v. Ball Corp., 862 F.2d 1428, 1429 (10th Cir. 1988), the
Tenth Circuit responded to a plaintiff’s argument that the ERISA
plan decision-makers had acted arbitrarily and capriciously in
determining that he was not totally disabled, without “taking into
account

his

age,

limited

educational

background,

unavailability of suitable employment in the area.”

and

the

The Tenth

Circuit responded as follows:
We believe that the policy concerns which underlie ERISA
would be severely undermined if we endorsed a literal
reading of the plan’s terms. Thus we join the reasoning
of the Eleventh Circuit and hold that a reasonable
interpretation of a claimant’s entitlement to payments
based on a claims of “total disability” must consider the
claimant’s ability to pursue gainful employment in light
of all the circumstances.
Id. (emphasis added).

In Demirovic v. Building Service 32 B-J

Pension Fund, 467 F.3d 208, 212-13 (2nd Cir. 2006), the Second
Circuit found:
[T]he Fund’s Review of Demirovic’s claim suffers from a
more fundamental flaw.
The Fund’s determination that
Demirovic is physically capable of performing some kind
20

of sedentary work may be supported by substantial
evidence; but the Fund appears to have given no
consideration whatsoever to whether Demirovic could, in
fact, find such sedentary work.
The Second Circuit cited Helms in support of this proposition,
which makes overwhelmingly good sense.
If there is evidence in this record upon which an unbiased
arbiter can find that a 57-year-old female, with all of the
physical ailments described by her treating physicians, can expect
to obtain gainful employment, particularly employment in which she
can “reasonably be expected to earn at least as much as her
Schedule Amount”, this court has not been able to find it.

In

today’s job market, employers are not eager to hire sedentary
workers 57 years of age who are in pain and have pervasive physical
ailments.
Remand
This case is peculiarly appropriate for mediation.

In light

of the foregoing, unless within two (2) weeks, the parties agree to
mediation in accordance with this court’s Alternative Dispute
Resolution Plan, the court will remand the dispute to the plan
administrator, who will be charged with obtaining answers to the
questions hereinabove outlined, and who shall provide a full and
fair administrative review.
copy of this opinion.

All witnesses shall be furnished a

The court shall expect this new review to be

completed and a final decision rendered within ninety (90) days.

21

DONE this 11th day of June, 2014.

_____________________________
WILLIAM M. ACKER, JR.
UNITED STATES DISTRICT JUDGE

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