Stewart v. Hartford Life and Accident Insurance Company

Filing 56

MEMORANDUM OPINION. Signed by Chief Judge Karon O Bowdre on 1/9/2019. (JLC)

FILED
2019 Jan-09 AM 10:37
U.S. DISTRICT COURT
N.D. OF ALABAMA

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
CAROL H. STEWART,
Plaintiff,
v.
HARTFORD LIFE AND ACCIDENT
INSURANCE COMPANY,
Defendant.

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Case No. 2:17-CV-1423-KOB

MEMORANDUM OPINION
This matter comes before the court on “Plaintiff’s Opposed Motion for Discovery.” (Doc.
43). Plaintiff Carol Stewart brought an ERISA claim against Hartford Life and Accident
Insurance Company for (1) denying her long-term disability (LTD) claim, and (2) denying her
waiver-of-life-premium (WOLP) claim. (Doc. 1). Ms. Stewart’s motion for discovery presents a
variety of arguments, and her proposed discovery contemplates far-reaching interrogatories,
requests for production, requests for admissions, and depositions. (Doc. 44). For the following
reasons, the court will GRANT IN PART the motion as to the specific requests identified in this
Opinion and will DENY the motion as to Plaintiff’s remaining discovery requests.
I.

Standard of Review
The motion under consideration seeks discovery beyond the scope of the administrative

record. But district courts reviewing ERISA benefits decisions do not typically permit discovery
outside the administrative record. See Quinn v. Qwest Comm’ns Corp., No. CV-09-BE-2403-E,
2011 WL 13227997, at *2 (N.D. Ala. Sept. 30, 2011) (“[A]n ERISA plaintiff cannot generally
supplement the Administrative Record with additional evidence after the plan administrator’s

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decision has been made.”) (citing Oliver v. Coca Cola Co., 497 F.3d 1181, 1195 (11th Cir.
2007)). The prohibition on extra-record discovery is not absolute, though, and the framework for
ERISA review elucidates when courts should allow additional discovery.
The language of ERISA does not dictate the standard of review courts should apply when
reviewing the benefits decision of plan administrators. But the Supreme Court determined that,
when an insurance policy vests the plan administrator with discretion to review claims, the
reviewing court should apply an arbitrary and capricious standard of review to the plan
administrator’s decisions. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 113 (1989).
The Eleventh Circuit has since established a six-step procedure for reviewing ERISA
benefits decisions:
(1) Apply the de novo standard to determine whether the claim administrator’s
benefits-denial decision is “wrong” (i.e., the court disagrees with the
administrator’s decision); if it is not, then end the inquiry and affirm the decision.
(2) If the administrator’s decision in fact is “de novo wrong,” then determine
whether he was vested with discretion in reviewing claims; if not, end judicial
inquiry and reverse the decision.
(3) If the administrator’s decision is “de novo wrong” and he was vested with
discretion in reviewing claims, then determine whether “reasonable” grounds
supported it (hence, review his decision under the more deferential arbitrary and
capricious standard).
(4) If no reasonable grounds exist, then end the inquiry and reverse the
administrator’s decision; if reasonable grounds do exist, then determine if he
operated under a conflict of interest.
(5) If there is no conflict, then end the inquiry and affirm the decision.
(6) If there is a conflict, the conflict should merely be a factor for the court to take
into account when determining whether an administrator’s decision was arbitrary
and capricious.
Blankenship v. Metro. Life Ins., 644 F.3d 1350, 1355 (11th Cir. 2011).
Applying this framework, if a court determines the benefits decision was de novo wrong
under Step 1 but that reasonable grounds for the decision existed under Step 3, the plaintiff
usually requires extra-record discovery to prove the existence and influence of the

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administrator’s conflict of interest at Steps 4 and 6. The administrative record, after all, rarely
discloses “much, if any, information about the conflict of interest.” Harvey v. Std. Ins., 787 F.
Supp. 2d 1287, 1291 (N.D. Ala. 2011).
The court recognizes that a structural conflict of interest presents “an unremarkable fact
in today’s marketplace.” See Blankenship, 644 F.3d at 1356. The court also recognizes that,
although not precedent or binding, the Eleventh Circuit has affirmed that conflict discovery is
not necessary when the dispute can be resolved under de novo review in Step 1. Blair v. Metro.
Life Ins., 569 F. App’x 827, 832 (11th Cir. 2014). Nevertheless, this court must consider a
conflict of interest as a factor in its analysis under the sixth and final step of reviewing ERISA
benefits decisions. See Metro. Life Ins. v. Glenn, 554 U.S. 2343, 2346 (2008). And the court
often requires extra-record discovery to do so.
But the court need not always limit this extra-record discovery to just conflict discovery.
For instance, reviewing courts “are limited to the record that was before [the administrator] when
it made its decision” during Step 1. Glazer v. Reliance Std. Life Ins., 524 F.3d 1241, 1247 (11th
Cir. 2008). But the “record before the administrator” can differ importantly from the official
administrative record defendant-administrators enter into evidence. See, e.g., Johnston v. Aetna
Life Ins., 282 F. Supp. 3d 1303, 1307 (S.D. Fla. 2017) (concluding that the Eleventh Circuit
“does not foreclose discovery of administrator’s consideration of other evidence that is not in the
administrative record”).
Stated differently, if the administrative record proves insufficient for the court to
complete its de novo review under Step 1, a reviewing court can permit extra-record discovery to
the extent that the requested discovery will better align the record before the court and the
“record before the administrator” at the time it made the benefits decision.

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II.

Factual Background
Plaintiff, Carol Stewart, began working as an attorney at the Burr & Forman law firm in

1983 and became an equity partner at Burr & Forman in 1990. Burr & Forman offered a welfare
benefit plan, for which Sun Life Financial began serving as underwriter and claims administrator
in 2007. This welfare benefit plan included LTD and life insurance, and Sun Life issued both
policies, which covered all Burr & Forman equity partners, including Ms. Stewart.
In 2007, doctors diagnosed Ms. Stewart with Parkinson’s disease, a progressive
degenerative neurological disease. She began receiving partial disability benefits under the Sun
Life LTD policy in 2009.
Sun Life continued to serve as insurer and claims administrator of the Plan until
September 30, 2010. Effective October 1, 2010, Defendant Hartford replaced Sun Life as the
Plan’s claims administrator and issued its own LTD and life insurance policies. Ms. Stewart
maintains that the Sun Life policies and the Hartford policies existed within the same continuous
“plan” (i.e., the Burr & Forman Plan), as the Hartford LTD policy uses the term.
Ms. Stewart continued to collect partial disability benefits under the Sun Life LTD policy
until the day she retired, March 31, 2012. Upon retirement, Ms. Stewart began collecting full
disability benefits under the Sun Life LTD policy and will continue to receive those benefits
until her 65th birthday, provided she continues to meet the policy’s definition of “Totally
Disabled.”
Ms. Stewart submitted a Long-Term Disability claim and a Waiver-of-Life-Premium
claim under the Hartford policies on or about July 18, 2012. To verify her disability, she relied
on the diagnosis and evaluations of Dr. David Standaert, her primary specialist for Parkinson’s
disease-related issues since 2007.

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Ms. Stewart received a letter dated September 24, 2012, informing her that Hartford had
denied her LTD claim. The letter explained that she was not eligible for disability benefits
through Hartford because she was “continuing to receive total disability benefits from Sun Life
Financial.” Hartford relied on the following language from the Hartford-issued LTD policy:
If You are receiving or are eligible for benefits for a Disability under a prior
disability plan that:
1) was sponsored by Your Employer; and
2) was terminated before the Effective Date of The Policy;
no benefits will be payable for the Disability under The Policy.
(the “prior plan” clause).
Ms. Stewart appealed this determination, and Hartford’s appeals unit affirmed the initial
denial in November 2012 for identical reasons.
Ms. Stewart received another letter dated October 1, 2012, informing her that Hartford
had also denied her waiver-of-premium claim as to the life insurance. The letter explained that
Hartford determined Ms. Stewart did not meet the policy’s definition of “disabled.” The policy
provides that disabled “means You are prevented by injury or sickness from doing any work for
which You are qualified by: 1) education; 2) training; or 3) experience.” The initial WOLP claim
denial letter stated that, although Ms. Stewart may not have been able to continue working as a
partner at a law firm, her condition did not prevent her “from performing any work.” Ms. Stewart
appealed and received word in December 2012 that Hartford’s Appeals Department had
reviewed her claim and determined she did in fact meet the definition of disabled and that
Hartford had approved her WOLP claim. That letter also informed Ms. Stewart that Hartford
might request updated medical information to verify continued disability and that it would be
reviewing her claim to clarify her cognitive limitations.

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Shortly after the approval of her WOLP benefits, Hartford ordered and Ms. Stewart
underwent a neuropsychological evaluation (NPE) and a behavioral functional evaluation (BFE).
Hartford’s internal communications indicate it intended to clarify Ms. Stewart’s cognitive
functionality with further testing. Dr. Nick DeFilippis, a neuropsychologist, performed the NPE
and BFE in a single day on March 7, 2013. Hartford hired Dr. DeFilippis through PsyBar, an
independent medical evaluation contracting firm, and Ms. Stewart had no previous relationship
with Dr. DeFilippis before the six-hour examination.
Following Dr. DeFilippis’s examination, Ms. Stewart received a letter dated April 10,
2013, from Hartford informing her that, pursuant to a claim review, she was no longer eligible
for WOLP benefits, as she did not meet the policy’s definition of disabled. The letter provided
that Hartford’s determination relied on Ms. Stewart’s entire claim file, but it specifically
referenced the NPE and BFE as supporting its reversal. The administrative record indicates that
Hartford may have relied entirely on the NPE and BFE results, potentially under the mistaken
impression that an “attending physician” had completed the NPE and BFE. Additionally, Ms.
Stewart notes that the administrative record indicates that Hartford examiner Ian Hardy made the
decision to deny Ms. Stewart’s claim, despite examiner Vanessa Balogh having handled
practically every aspect of the initial claim and appeal until Hardy’s final decision.
Dr. DeFilippis and Dr. Standaert, Ms. Stewart’s treating physician, are the only
specialists referenced in the administrative record whose opinions are based on physical and
clinical examinations. Dr. Standaert is a medical doctor specializing in Parkinson’s disease; Dr.
DeFilippis is a clinical and neuropsychologist with no particular Parkinson’s expertise, and he is
not a physician.

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Ms. Stewart requested that Hartford reconsider its decision; Hartford ultimately affirmed
the April 10 decision denying her WOLP benefits in a November 2013 letter. The November
letter stated that Hartford relied on the entire claim file, including Dr. Standaert’s evaluations and
Dr. DeFilippis’s single evaluation, as well as the reports of at least two independent medical
reviewers who evaluated Ms. Stewart’s file but did not perform a physical examination.
Ms. Stewart brought this ERISA challenge and now moves this court to permit extrarecord discovery, a request the court reviews against the background of her claim.
III.

Analysis
Ms. Stewart has moved for expansive discovery, and most of her requests should be

denied. For instance, Ms. Stewart requests discovery about Hartford’s interpretation of the “prior
plan” clause and the definition of “disabled” but has not explained how the discovery would aid
this court in either its de novo review, determination of a conflict of interest, or determination of
the impact that a potential conflict of interest could have had on the ultimate benefits decision.
This court does not opine that all extra-record discovery requests related to policy interpretation
are categorically inappropriate, but it does conclude that Ms. Stewart has failed to show the
utility of such evidence in this case.
But Ms. Stewart’s motion for discovery highlights several areas where additional
discovery could fill in some gaps left by the administrative record. Additionally, Ms. Stewart’s
motion for discovery regarding Hartford’s conflict of interest should be granted. Thus, the court
grants Plaintiff’s motion for discovery on the following subjects.
A. Hartford’s potential conflict of interest
Plaintiff’s proposed discovery includes several requests aimed at determining the
existence and extent of Defendant’s conflict of interest. In keeping with the Supreme Court and

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Eleventh Circuit’s guidance, this court will GRANT Plaintiff’s motion for discovery regarding
Defendant’s conflict of interest. But the court limits this discovery to the narrow question of
Hartford’s conflict of interest as it pertains to this claim and emphasizes that its Order granting
limited discovery does not permit Plaintiff to engage in expansive and unwarranted discovery.
Thus, this court will GRANT Plaintiff’s requests for Interrogatory No. 2, Interrogatory No. 3,
Interrogatory No. 6, and Request for Production No. 6. 1
B. Details of April 10, 2013 denial
Hartford initially denied Ms. Stewart’s WOLP claim on October 1, 2012, explaining that
she was not disabled according to the Hartford life insurance policy’s definition. After Ms.
Stewart’s appeal, Hartford reversed its initial decision and approved her WOLP claim in
December 2012 after determining that she did meet the policy’s definition of disabled. Hartford
subsequently ordered a neuropsychological evaluation, which took place in March 2013. Then,
in a letter dated April 10, 2013, Hartford informed Ms. Stewart that, pursuant to that evaluation,
it found insufficient evidence to document Ms. Stewart’s continued disability and that she was
no longer eligible for WOLP benefits.
Hartford’s approval letter to Ms. Stewart mentions its authority to periodically “verify”
her continued disability and its intention to review her claim to “clarify” her current cognitive
limitations. But the administrative record does not clearly articulate the difference, if any,
between those two authorizations, nor does it adequately specify under which authorization
Hartford ultimately decided to deny Ms. Stewart’s WOLP claim. The Hartford policy allows
Hartford to have insureds “examined at reasonable intervals” upon their WOLP claim approval

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Interrogatories Nos. 2 and 3 request the identities of the individuals involved in Plaintiff’s claims denials.
Interrogatory No. 6 requests the compensation details for the individuals identified in response to Interrogatories
Nos. 2 and 3. Request for Production No. 6 requests performance evaluations for several Hartford employees
mentioned in the administrative record as participants in Ms. Stewart’s benefits determination.

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but does not indicate what deference Hartford affords approval decisions in view of these
examinations. Clarity on these issues could help the court review de novo Hartford’s benefits
decision. Thus, this court will GRANT Plaintiff’s requests for Interrogatory No. 10(e); the first,
second, and fifth bullet points of Interrogatory No. 19; and Plaintiff’s Request for Production
No. 7. 2
C. Dr. DeFilippis’s appointment as medical evaluator
Shortly after Hartford’s December approval of Ms. Stewart’s WOLP claim, it ordered an
independent neuropsychological evaluation through the contracting firm PsyBar. Ultimately, Dr.
DeFilippis, a professor and practitioner of both clinical and neuropsychology in Atlanta,
examined Ms. Stewart for approximately six hours on a single day in March 2013. The record
contains scant details regarding the rationale for ordering the testing and why Hartford and
PsyBar selected Dr. DeFilippis. Information regarding the objectives of the March
neuropsychological examination, the rationale for appointing Dr. DeFilippis as evaluator, and the
procedure for weighing various evaluations in determining disability could help the court review
de novo Hartford’s benefits decision.
Thus, this court will GRANT Plaintiff’s requests for Interrogatory No. 10(a)–(c), the
third bullet point of Interrogatory No. 19, and Plaintiff’s Request for Production No. 18. 3
D. Role of Hartford examiner Ian Hardy
Vanessa Balogh, an examiner based in Sacramento, California, apparently was the
examiner assigned to Ms. Stewart’s case. Ms. Balogh made the initial decision to deny Ms.
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Interrogatories Nos. 10(e) and 19 request clarity regarding Hartford’s authority to review and overturn Ms.
Stewart’s favorable benefits decision. Interrogatory No. 19 also requests information regarding Hartford’s decision
to order neuropsychological testing on Ms. Stewart after approving her claim. Request for Production No. 7 requests
Hartford’s claim procedure that allows Hartford to review Ms. Stewart’s favorable benefits decision.
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Interrogatory No. 10(a)–(c) requests the identities of the individuals who ordered the neuropsychological testing,
selected Dr. DeFilippis to administer the neuropsychological testing, and selected the specific tests to which Ms.
Stewart was subjected. Interrogatory No. 19 and Request for Production No. 18 request information about
Hartford’s authority to order neuropsychological testing after approving Ms. Hartford’s WOLP claim.

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Stewart’s WOLP claim on October 1, 2012; she forwarded Ms. Stewart’s initial appeal to
Hartford’s appeals unit and drafted the December letter reversing the initial denial; and she
ordered and scheduled the March neuropsychological examination as part of an ongoing review.
Then, on March 29, 2013, Atlanta-based examiner Ian Hardy recommended terminating Ms.
Stewart’s WOLP claim.
Additional information on Mr. Hardy’s role in and knowledge of Ms. Stewart’s WOLP
claim could help this court when it reviews de novo Hartford’s benefits decision. Thus, this court
will GRANT Plaintiff’s requests for Interrogatory No. 8 (as it relates to Ian Hardy), Interrogatory
No. 10(f), and the fourth bullet point of Interrogatory No. 19. 4
IV.

Conclusion
For the reasons discussed above, the court will GRANT IN PART and DENY IN PART

Plaintiff’s Motion for Discovery. (Doc. 43). The court will GRANT Plaintiff’s Motion for
Discovery as to Interrogatories No. 8 (as it relates to Ian Hardy); No. 10(a)–(c), (e), and (f); and
No. 19. The court will GRANT Plaintiff’s Motion for Discovery as to Requests for Production
No. 7 and No. 18. The court will DENY Plaintiff’s Motion for Discovery as to the remaining
Interrogatories, Requests for Production, Requests for Admissions, and Requests for
Depositions.
The court cautions the plaintiff that this Opinion and accompanying Order do not grant
her license to engage in an uninhibited fishing expedition. The court grants discovery for only
the limited topics discussed above and only to the extent that it will aid this court in reviewing de
novo Hartford’s denial of Ms. Stewart’s WOLP claim or in assessing the impact of Hartford’s
conflict of interest.

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Interrogatories Nos. 8, 10(f), and 19 request information about Ian Hardy’s assignment to Ms. Stewart’s benefits
claims.

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DONE and ORDERED this 9th day of January, 2019.

____________________________________
KARON OWEN BOWDRE
CHIEF UNITED STATES DISTRICT JUDGE

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