Reidy v. The Unum Life Insurance Company of America et al
Filing
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MEMORANDUM OPINION AND ORDER denying 26 Motion to Compel Discovery. Signed by Judge Paula Xinis on 12/13/2017. (aos, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
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KARIN REIDY,
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Plaintiff,
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v.
Civil Action No. PX–16–2926
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THE UNUM LIFE INSURANCE
COMPANY OF AMERICA, et al.
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Defendant(s).
******
MEMORANDUM OPINION & ORDER
Karin Reidy (Plaintiff) brought this suit against Unum Life Insurance Company of
America and The Squire Patton Boggs Group Long Term Disability Plan (Defendants), seeking a
declaration of entitlement to disability benefits, payment of back-benefits plus interest, and costs
pursuant to the Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seq. (ERISA).
On May 19, 2017, Plaintiff moved to compel discovery, ECF No. 26. The issues are fully
briefed and the Court now rules pursuant to Local Rule 105.6 because no hearing is necessary.
For the reasons set forth below, Plaintiff’s Motion to Compel Discovery (ECF No. 26) is
DENIED.
I.
BACKGROUND
Plaintiff is a former employee of Squire Patton Boggs where she served as the Director of
Professional Development and Retention. ECF No. 1 at ¶ 11. Plaintiff was a plan participant
under a group benefits plan established by Defendant Squire Patton Group Long Term Disability
Plan. ECF No. 1 at ¶ 6; see also ECF No. 8. Defendant Unum Life Insurance Company of
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America (“Unum”) is the claims administrator and insurer of Plaintiff’s disability insurance.
ECF No. 1 at ¶ 7; see also ECF No. 6.
Plaintiff avers that she became disabled on or around March 27, 2014 and sought
disability benefits. Id. at ¶ 12. Defendants denied Plaintiff’s claim on July 30, 2015. Id. at ¶ 13.
Plaintiff appealed Unum’s decision and Unum denied the appeal on March 21, 2016. Id. at ¶¶
14–15. Plaintiff then filed this action against the plan under § 502(a)(1)(B) of the Employment
Retirement Income Security Act of 1974 (“ERISA”), requesting that this Court declare her
entitled to benefits under the plan. ECF No. 1.
After filing the Complaint, Plaintiff propounded interrogatories and requests for
production of documents on Defendants regarding the doctors that reviewed Plaintiff’s claim, Dr.
Kletti and Dr. Shipko.
See ECF Nos. 22 & 26-2.
Plaintiff more particularly requested
Defendants produce evidence regarding (1) the total number of ERISA disability claims referred
to Dr. Kletti and how many of these claims were approved; (2) the total number of ERISA
disability claims referred to Dr. Shipko and how many of these claims were approved; (3) the
number of times Drs. Kletti and Shipko reviewed the same claim from 2014 to present; and (4)
all monies paid to Drs. Kletti and Shipko from 2014 to present under the Unum Management
Incentive Compensation Plan (MCIP) or other bonus plans. Plaintiff asserts that this information
is necessary to determine if Dr. Kletti and Dr. Shipko’s denial is somehow tied to Unum’s
compensation structure. ECF No. 26-1 at 6–8. Defendants object to Plaintiff’s requests as moot,
immaterial, and disproportionate to the needs of the case under Fed. R. Civ. P. 26(b)(1). ECF
No. 27.
On May 19, 2017, Plaintiff moved to compel the above-described discovery. ECF No.
26. On June 7, 2017, Unum opposed, principally arguing that Plaintiff is not entitled to the
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discovery because the administrative record is sufficient for the Court to determine whether and
the extent to which Unum’s conflict of interest improperly influenced Plaintiff’s benefits
decision. Id. For the following reasons, the Court agrees with Unum.
II.
DISCUSSION
Because “the administration of ERISA plans should be left to plan fiduciaries, not
federal courts,” judicial review of plan administrator decisions is generally limited to the
evidence presented to the plan administrator at the time of decision. Helton v. AT & T Inc., 709
F.3d 343, 352 (4th Cir. 2013); Clark v. Unum Life Ins. Co. of Am., 799 F. Supp. 2d 527, 531 (D.
Md. 2011) (noting it is “settled law in this circuit that a district court reviewing a plan
administrator’s decision under a deferential standard may consider only the evidence before the
administrator at the time of decision.”). Accordingly, when a plaintiff requests extra-record
discovery into a defendant’s alleged conflict of interest, the court must determine “at the outset .
. . whether or not the administrative record contains enough information to allow the court to
properly weigh [the] [d]efendant’s admitted conflict of interest.” Clark, 799 F. Supp. 2d at 533.
The plaintiff bears the burden of “provid[ing] a basis for the court to determine whether such
discovery would fill gaps in the record, and demonstrat[ing] that such discovery is necessary to
determine the weight of administrator's conflict.” Ferguson ex rel. Estate of Ferguson v. United
Omaha Life Ins. Co., No. ELH–12–1035, 2012 WL 6649192, at *2; see also Griffin v. Hartford
Life & Accident Ins. Co., No. 16–24, 2016 WL 8795570 at *2 (W. D. Va. Sept. 27, 2016). Put
differently, extra record discovery is permitted only where the moving party plausibly alleges a
conflict of interest specific to the plaintiff’s claim; it is not warranted where the plaintiff’s sole
contention rests on “alleged general unfairness” in a defendant’s business practices. Clark, 799
F. Supp. 2d. at 533–34. See also Griffin, 2016 WL 8795570 at *3; Lockard v. Unum Life Ins.
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Co. of Am., No. 15–21, 2015 WL 4730089 at *3–*4 (N. D. W. Va. Aug. 10, 2015). Thus, “the
relevance and necessity of [Plaintiff’s] proposed extra-record discovery depends on ‘whether or
not the administrative record contains enough information to allow the court to properly weigh
Defendant’s admitted conflict of interest.’” Griffin, 2016 WL 8794470 at *3 (quoting Clark, 799
F. Supp. 2d at 533).
Here, Plaintiff argues that additional discovery is necessary because Unum’s “Annual
Incentive Plan,” – the yearly bonus plan for Unum employees that includes awards of common
stock based upon company performance – impermissibly incentivized the reviewing physicians
to deny legitimate disability claims. See, e.g., ECF No. 26-1 at 8. Plaintiff argues that incentives
based on company performance, “especially where director-physicians are required to hold
company stock, serve to produce a very troubling conflict of interest which encourages claim
denials.” Id. (emphasis in original). In support, Plaintiff points to earlier cases and government
reports documenting Defendant Unum’s biased claims investigation practices. See, e.g., ECF
No. 26-1 at 9.
Unum acknowledges its inherent structural conflict of interest as the plan’s insurers and
claims administrator. However, Unum rightfully point out that the mere existence of its Annual
Incentive Plan is insufficient to transform a generalized conflict into one affecting Unum’s denial
of Plaintiff’s claims. See ECF No. 27 at 14–32. Unum further argues that the 7,436 page
administrative record, which includes Unum’s detailed claim investigation and analysis, is
sufficient for the Court to determine the extent to which Unum’s conflicting interests influenced
Plaintiff’s benefits decision, if at all. See ECF No. 27. Defendant contends that this is especially
true because it provided to Plaintiff Unum’s Annual Incentive Plan, Stock Incentive Plan of
2012, and 2015 Proxy Statement. See ECF No. 27-6. The Court agrees.
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The critical flaw in Plaintiff’s Motion is her failure to assert particularized facts that
render extra-record discovery necessary to explore Unum’s conflict of interest in adjudication of
her particular claim. Instead, Plaintiff broadly characterizes “Unum’s sordid history from unfair
claims handling evidence” and “the poor financial performance of Unum which has compelled
its conduct in denying disability cases to stem losses and improve company profitability.” ECF
No. 29 at 7–8. None of these statements, even if true, speak specifically to Plaintiff’s claim or to
any “gaps” in the administrative record that the requested discovery would supplement. Accord
Clark, 799 F. Supp. 2d at 536 (D. Md. 2011) and Rickaby v. Hartford Life & Accident Ins. Co.,
No. WYD–NYW–16–813, 2016 WL 1597589 at *3–*4 (D. Co. Apr. 21, 2016) (“a simple tally
of the number of grants and denials would lack meaning”).
Moreover, Plaintiff undercuts the need for the requested discovery by noting that the
administrative record demonstrates “a selective review of the evidence followed by a naked
conclusion bereft of any reasoning,” and characterizes Drs. Kletti and Shipko’s failure to conduct
a personal interview with the claimant as “unethical per se.” ECF Nos. 26 at 11 & 29 at 14. If
Plaintiff’s assertions regarding the administrative record are true, then the record as it stands is
sufficient for the Court to assess to what extent Unum’s conflict of interest affected its review of
Plaintiff’s claims.
Finally, the requested discovery does not meet the requirements of Federal Rule of Civil
Procedure 26(b)(1). Rule 26(b)(1) provides:
Parties may obtain discovery regarding any nonprivileged matter that is relevant to any
party’s claim or defense and proportional to the needs of the case, considering the
importance of the issues at stake in the action, the amount in controversy, the parties’
relative access to relevant information, the parties’ resources, the importance of discovery
in resolving the issues, and whether the burden or expense of the proposed discovery
outweighs its likely benefit.
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Fed. R. Civ. P. 26(b)(1) (emphasis added). Plaintiff has not established that the requested
discovery is necessary to resolve the issues in this case or justifies the burden placed on
Defendants by its production. On this ground alone, Plaintiff’s motion must be denied. Id.
III.
CONCLUSION
For the reasons stated in above, it is this 13th day of December, 2017, by the United States
District Court for the District of Maryland, ORDERED that:
1.
Plaintiff’s Motion to Compel Discovery (ECF No. 26) BE, and the same hereby
IS, DENIED;
2.
The Clerk shall transmit copies of this Memorandum Opinion and Order to the
parties and counsel in this case.
12/13/2017
Date
/S/
Paula Xinis
United States District Judge
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