Ramirez v. Unum Provident Life and Accident Insurance Company

Filing 38

FINDINGS OF FACT, RULINGS OF LAW, AND ORDER FOR JUDGMENT Signed by Judge William G Young on 12/7/2016."For the foregoing reasons, the Court finds and rules that Ramirez is entitled to benefits under his LTD policy. Judgment will enter for Ramirez. SO ORDERED."(EES)

UNITED STATES DISTRICT COURT
DISTRICT OF PUERTO RICO
___________________________________
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)
)
Plaintiff,
)
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v.
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UNUM PROVIDENT LIFE AND
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ACCIDENT INSURANCE COMPANY,
)
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Defendant.
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___________________________________)
JOSE G. RAMIREZ, JR.,

YOUNG, D.J.1

CIVIL ACTION
NO. 15-02141-WGY

December 7, 2016

FINDINGS OF FACT, RULINGS OF LAW,
AND ORDER FOR JUDGMENT

I.

INTRODUCTION
On August 20, 2015, Jose G. Ramirez, Jr. (“Ramirez”) filed

a complaint in the District Court for the District of Puerto
Rico, alleging that Unum Provident Life and Insurance Company
(“Provident”) violated 29 U.S.C. § 1132(a)(1)(B) in denying
Ramirez’s benefits claim under a long-term disability insurance
policy (“LTD policy”).

Compl. 1, ECF No. 1.

answered on October 16, 2015.

Provident timely

Answer, ECF No. 7.

On April 25, 2016, Ramirez and Provident filed crossmotions for summary judgment pursuant to Federal Rule of Civil

1

Of the District of Massachusetts, sitting by designation.

Procedure 56(c).

Mot. Summ. J. (“Pl.’s Mot. Summ. J.”), ECF No.

17; Mot. Summ. J. Administrative R., ECF No. 18.
also submitted supporting statements of facts.

The parties

Statement

Uncontested Material Facts (“Pl.’s Statement Facts”), ECF No.
15; Statement Uncontested Material Facts Supp. Mot. Summ. J.
Administrative R. (“Def.’s Statement Facts”), ECF No. 19.

On

May 27, 2015, Ramirez filed a memorandum in opposition to
Provident’s motion, Resp. Opp’n Mot. Summ. J., ECF No. 26, along
with a counterstatement of facts, Counterstatement Material
Facts (“Pl.’s Counterstatement Facts”), ECF No. 27.

Provident

did not file a response or counterstatement of facts to
Ramirez’s motion for summary judgment.
With the agreement of the parties, the Court held a case
stated hearing on November 14, 2016.2

It now makes the following

findings of fact and rulings of law.
II.

FINDINGS OF FACT
Ramirez obtained the LTD policy at issue on January 1,

2002, while still employed by UBS Financial Services (“UBS”),

2

The case stated procedure allows the Court to render a
judgment based on the largely undisputed record in cases where
there are minimal factual disputes. In its review of the
record, “[t]he [C]ourt is . . . entitled to ‘engage in a certain
amount of factfinding, including the drawing of inferences.’”
TLT Constr. Corp. v. RI, Inc., 484 F.3d 130, 135 n.6 (1st Cir.
2007) (quoting United Paperworkers Int’l Union Local 14 v.
International Paper Co., 64 F.3d 28, 31 (1st Cir. 1995)).
[2]

Pl.’s Counterstatement Facts ¶ 4; Def.’s Statement Facts ¶ 4, as
a financial analyst, Pl.’s Statement Facts ¶ 5.

On August 21,

2013, Ramirez became disabled for health-related problems.3

Id.;

Pl.’s Statement Facts, Ex. 1, Individual Disability Claim Form
Individual Statement, ECF No. 15-1.
after that day.

He never returned to work

Pl.’s Counterstatement Facts ¶ 7; Def.’s

Statement Facts ¶ 7.
January 23, 2014.

Ramirez ultimately was fired by UBS on

Pl.’s Counterstatement Facts ¶ 9; Def.’s

Statement Facts ¶ 9.
On February 20, 2014, two days after his 180-day
elimination period ended, Ramirez filed a disability claim with
Provident, requesting benefits under the LTD policy.

Pl.’s

Counterstatement Facts ¶¶ 7, 11; Def.’s Statement Facts ¶¶ 7,
11.
On May 14, 2014, the Financial Industry Regulatory
Authority (“FINRA”) suspended Ramirez’s broker’s license,
effective on June 9, 2014, for failure to cooperate with its
internal investigations.

Pl.’s Counterstatement Facts ¶ 13;

3

Ramirez’s attending physician, Dr. Juan Fumero-Perez,
examined and diagnosed him with general anxiety disorder and
major depression on December 26, 2013. Def.’s Statement Facts,
Ex. A1, Individual Disability Claim Form Attending Physician
Statement (“Attending Physician Statement”) 105, ECF 19-1.
Medical reports in the court records show that Ramirez had
received treatment for those same conditions at least as early
as October 7, 2003. Id.
[3]

Pl.’s Statement Facts, Ex. 2, Letter from FINRA to Ramirez’s
counsel, Guillermo Luina, dated May 14, 2014 1, ECF No. 15-2;
Def.’s Statement Facts ¶ 13.
On June 12, 2014, Provident sent a letter to Ramirez
informing him that, although it had not reached a final decision
regarding his benefits claim, it would pay him benefits under a
reservation of rights while it completed a review of his claim.
Pl.’s Counterstatement Facts ¶ 11; Pl.’s Statement Facts, Ex. 4,
Letter from Provident to Ramirez dated June 12, 2014 (“June
Letter”) 1, ECF No. 15-4; Def.’s Statement Facts ¶ 11.
On November 13, 2014, Provident sent a letter to Ramirez
denying his benefits claim under the LTD policy because
Provident understood that Ramirez’s disability was the result of
his “legal issues and resulting termination from employment and
loss of license.”4

Pl.’s Counterstatement Facts ¶ 15; Pl.’s

Statement Facts, Ex. 6, Letter from Provident to Ramirez dated
November 13, 2014 (“November Letter”) 2, ECF No. 15-6; Def.’s
Statement Facts ¶ 15.
2015.

Ramirez appealed that decision on May 8,

Pl.’s Counterstatement Facts ¶ 17; Pl.’s Statement Facts,

4

The “legal issues” -- which had been mentioned by many
physicians who examined and diagnosed Ramirez -- refer to the
many client complaints about Ramirez during his employment at
UBS. Pl.’s Counterstatement Facts ¶ 9; Def.’s Statement Facts
¶ 9.
[4]

Ex. 8, Letter from Ramirez’s counsel to Provident dated May 8,
2015 1, ECF No. 15-8; Def.’s Statement Facts ¶ 17.
On July 1, 2015, Provident sent a letter to Ramirez
informing him that his appeal had been denied.

Pl.’s

Counterstatement Facts ¶ 19; Pl.’s Statement Facts, Ex. 10,
Letter from Provident to Ramirez dated July 1, 2015 1, ECF No.
15-10; Def.’s Statement Facts ¶ 19.
III. RULINGS OF LAW
The Court makes rulings of law on two issues: (i) whether
Provident had previously waived the exclusion it relied on to
deny Ramirez’s benefits claim, and (ii) whether Provident
correctly applied that same exclusion when it denied Ramirez’s
benefits claim under the LTD policy.
A.

Legal Standard

Because the LTD policy does not give Provident
discretionary authority to determine eligibility for benefits or
to construe the terms of the plan, the Court reviews Provident’s
decision to deny Ramirez benefits de novo, see Firestone Tire &
Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989).

In doing so, the

Court gives no special deference to the opinion of Ramirez’s
treating physician.

See Black & Decker Disability Plan v. Nord,

538 U.S. 822, 831 (2003); Orndorf v. Paul Revere Life Ins. Co.,
404 F.3d 510, 526 (1st Cir. 2005); Diaz v. Metro. Life Ins. Co.,
688 F. Supp. 2d 49, 61 (D.P.R. 2010) (Besosa, J.).
[5]

B.

Exclusion Waiver

The LTD policy defines total disability as follows:
Total Disability, or totally disabled, means that, due to
Injuries or Sickness:
1. you are not able to perform the substantial and material
duties of your occupation;
2. you are not working in any other gainful occupation; and
3. you are receiving the care of a Physician which is
appropriate for the condition causing your disability and
which is intended to help you return to work in your
occupation. We will waive this requirement when we are
furnished proof, satisfactory to us, that continued care
would no longer be of benefit to you.
Pl.’s Statement Facts, Ex. 7, Disability Income Policy
(“Policy”) 7, ECF No. 15-7.

The LTD policy also includes the

following exclusions from coverage:
1. loss caused by any act of war, whether war is declared
or not;
2. loss caused by intentionally self inflicted injuries;
3. loss caused solely by the suspension, revocation or
surrender of your professional license to practice in your
occupation;
4. any period of time within a period of disability during
which you are residing outside of the United States or
Canada for more than 12 months, unless we agree otherwise
in writing;
5. any loss to which a contributing cause was your
commission of or attempt to commit a felony, or your being
engaged in an illegal occupation; or
6. loss we have excluded by name or specific description
(any such exclusion will appear in the Policy Schedule).
Id. at 12.

In the June Letter granting Ramirez benefits under a

reservation of rights, Provident referred explicitly only to
exclusion number 5.

June Letter 3.

In its November Letter,

however, Provident cited exclusion number 3 in its decision
denying Ramirez’s benefits.

November Letter 3.
[6]

Ramirez argues that Provident’s failure to raise this
second exclusion in the June Letter waived Provident’s right to
later use that exclusion as the ground for denying Ramirez
benefits under the LTD policy.

Pl.’s Mot. Summ. J. ¶¶ 2.9-2.13.

Although the First Circuit is silent on this specific
issue, other circuits have recognized that where an insurance
company “relies on specific grounds for denying a claim [it]
thereby waives the right to rely in subsequent litigation on any
other grounds which a reasonable investigation would have
uncovered,” Hydro Sys., Inc. v. Continental Ins. Co., 929 F.2d
472, 475 (9th Cir. 1991) (alteration in original) (emphasis
added) (quoting McLaughlin v. Connecticut Gen. Life Ins. Co.,
565 F. Supp. 434, 451 (N.D. Cal. 1983)); see also Luria Bros. &
Co. v. Alliance Assurance Co., Ltd., 780 F.2d 1082, 1090 (2d
Cir. 1986).
Even were this Court to accept this line of precedent, it
does not follow that Provident waived the exclusion upon which
it relied to deny Ramirez benefits.

Under the cited

authorities, waiver applies only when the insurance company
tries to raise exclusions different from those it relied on to
deny a benefits claim.

Ramirez does not point to case law

holding that an insurance company cannot deny a claim based on
an exclusion to which it simply failed explicitly to refer in

[7]

prior communications with the policy holder, when that exclusion
is part of the policy at issue.
In its June Letter, Provident did not deny Ramirez’s claim
-- it explicitly stated that Ramirez’s claim was still under
review.

The Court, thus, rules that Provident has not waived

the exclusion it used to deny Ramirez benefits in its November
letter.
C.

Exclusion Application

As noted above, in its November Letter, Provident denied
Ramirez’s benefits claim under the LTD policy because it
understood that his disability was the result of his legal
issues, termination, and ultimate loss of license.
Letter 3.

November

Ramirez argues that Provident incorrectly applied the

exclusion because his inability to work antedated the revocation
of his license.5

Pl.’s Mot. Summ. J. ¶ 2.13.

Both Ramirez and Provident admit that Ramirez’s healthrelated incapacitating disability started before he lost his
broker’s license.6

See Pl.’s Statement Facts ¶ 5; Pl.’s

5

The LTD policy provides: “We will not pay benefits for
. . . loss caused solely by the suspension, revocation or
surrender of your professional license to practice in your
occupation.” Policy 12 (emphasis added).
6

Both physicians from Provident who examined Ramirez, Dr.
Peter Brown and Dr. Lloyd Price, agreed with Ramirez’s attending
physician’s conclusion that “[t]he precipitating and
perpetuating causes of [Ramirez]’s [health-related disability]
[we]re the ongoing stress of multiple client complaints, being
[8]

Counterstatement Facts ¶ 11; Def.’s Statement Facts ¶ 11.
Accordingly, what is in dispute here is the correct
interpretation of the terms of the LTD policy, i.e., whether
Ramirez’s disability falls within the exclusion on which
Provident relied to deny Ramirez’s benefits claim.
matter of law, not fact.

This is

See Utica Mut. Ins. Co. v. Herbert H.

Landy Ins. Agency, Inc., 820 F.3d 36, 41 (1st Cir. 2016) (citing
Massamont Ins. Agency, Inc. v. Utica Mut. Ins. Co., 489 F.3d 71,
72 (1st Cir. 2007)).
In order to interpret the policy’s exclusionary language,
the Court refers to local law.

See Littlefield v. Acadia Ins.

Co., 392 F.3d 1, 7 (1st Cir. 2004); CWC Builders, Inc. v. United
Specialty Ins. Co., 134 F. Supp. 3d 589, 597 (D. Mass 2015)
(Woodlock, J.); Nahan v. Pan American Grain Mfg. Co., Inc., 62
F. Supp. 2d 419, 423 (D.P.R. 1999) (Dominguez, J.) (citing
United States Fire Ins. Co. v. Producciones Padosa, Inc., 835
F.2d 950 (1st Cir. 1987)).

Under Puerto Rican law, insurance

policies are considered contracts of adhesion, and consequently,
they ought be liberally construed to protect the insured.

terminated for misconduct and the associated legal proceedings.”
Pl.’s Statement Facts, Ex. 9, Dr. Peter Brown Activity Report
(“Dr. Brown Activity Report”) 3, ECF No. 15-9; accord Pl.’s
Statement Facts, Ex. 5, Dr. Lloyd Price Activity Report (“Dr.
Price Activity Report”) 1-2, ECF No. 15-5. In particular, Dr.
Brown explicitly agreed with Ramirez’s attending physician’s
conclusion that Ramirez suffered from disabling anxiety and
depression on August 21, 2013. Dr. Brown Activity Report 3.
[9]

Maderas Tratadas v. Sun Alliance Ins. Co., 185 D.P.R. 880, 89899 (P.R. Sup. Ct. 2012); Quiñones López v. Manzano Pozas, 141
D.P.R. 139, 155 (P.R. Sup. Ct. 1996).

Any doubts regarding the

disability benefits exclusions in insurance policies must be
resolved in favor of the insured.

See Maderas Tratadas, 185

D.P.R. at 899.
Here, the exclusion upon which Provident relies is
unambiguous.

It provides that benefits will not be paid for

“loss caused solely by the suspension, revocation or surrender
of your professional license to practice in your occupation.”
Policy 12 (emphasis added).

Under the most plausible

interpretation of such exclusion, the insurer need not pay
benefits to the insured for a loss suffered solely due to the
suspension or loss of the insured’s professional license.

The

medical records here show that Ramirez’s disability commenced at
least as early as August 21, 2013 -- potentially even earlier.
Attending Physician Statement 105; Dr. Brown Activity Report 3;
Dr. Price Activity Report 2.

Ramirez had his license suspended

on May 14, 2014; thus, his loss could not have been caused -let alone solely caused -- by the suspension or loss of his
professional license pursuant to the LTD policy.

Accordingly,

the Court rules that Provident mistakenly interpreted the LTD
policy in denying Ramirez’s benefits claim.

[10]

IV.

CONCLUSION
For the foregoing reasons, the Court finds and rules that

Ramirez is entitled to benefits under his LTD policy.

Judgment

will enter for Ramirez.
SO ORDERED.
/s/WILLIAM G. YOUNG
WILLIAM G. YOUNG
DISTRICT JUDGE

[11]