12 Fla. L. Weekly Supp. 468a
Employee Retirement Income Security Act — Disability insurance — Denial of disability income benefits based on erroneous conclusion that claimant was only partially disabled is reversed in accordance with ERISA — Where nothing in evidence other than vocational review fatally flawed by mischaracterization of claimant’s bookkeeper position as staff accountant supports plan administrator’s argument that claimant could be employed as bookkeeper because she could perform tasks required of position with left hand rather than right hand to relieve stress on injured right shoulder, claimant was disabled within meaning of policy, and administrator’s decision to deny benefits was incorrect — Remedies — Where court has concluded after de novo review that claimant was totally disabled at time of denial of benefits, no practical purpose would be served by remand to administrator for further findings concerning her condition at time of denial of benefits, and it is appropriate to remand with directions to pay benefits through date of final denial of claimant’s administrative appeal and to reconsider denial of benefits from that date to present
NANCY BARNES HOLT, Plaintiff, vs. UNUM LIFE INSURANCE COMPANY OF AMERICA, Defendant. Circuit Court, 18th Judicial Circuit in and for Brevard County. Case No. 05-1995-CA-017536-XXXX-XX. July 7, 2004. T. Mitchell Barlow, Judge. Counsel: Robert J. Telfer. Wendy L. Furman.
FINAL JUDGMENT FOR PLAINTIFF
[Editor’s note: Order on Rehearing published at 12 Fla. L. Weekly Supp. 470a.]
THIS CASE came before the Court for trial on the Complaint of the Plaintiff, NANCY BARNES HOLT (“Holt”) filed against the Defendant, UNUM LIFE INSURANCE COMPANY OF AMERICAN (“Unum”). In the late 1980’s, Holt purchased disability insurance through her then-employer, the certified public accounting firm of Dobson, Bjering and Duffey (“Dobson”) which insurance was provided by Unum. Holt was originally paid disability benefits under her plan but those benefits were ultimately halted by Unum in 1995. Holt’s complaint seeks to have this Court review that denial of insurance benefits by Unum’s plan administrator in accordance with the Employee Retirement Income Security Act of 1974, as amended, 29 U.S.C. §1001, et. seq. (“ERISA”). ERISA specifically authorizes a person to bring a civil action “to recover benefits due him under the terms of his plan,” to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the plan”. 29 U.S.C. § 1132(a)(1)(B).
I. FINDINGS OF FACT
The evidence shows that Holt was working as a bookkeeper in the Dobson firm in 1989 when she was injured in an automobile accident. After that accident, Holt submitted a claim for benefits, alleging that she was unable to continue working as a bookkeeper due to the injuries which she had sustained in the accident. Unum originally approved her claim as of May 20, 1990, and began paying her disability benefits under the policy. In October of that year, Holt had the first surgery on her right shoulder performed by John Hermansdorfer, M.D.
In February 1991, Dr. Hermansdorfer stated that Holt could return to work as a bookkeeper on a part-time basis. Unum then advised Holt that she would no longer qualify for benefits under the policy unless she returned to work as a part-time bookkeeper. Holt then went to work as a bookkeeper for another employer in March 1991. She continued with that employment until Dr. Hermansdorfer performed a second surgery on her shoulder in May of that year.
After a period of recovery, Holt again began working as a bookkeeper in August 1991, this time for Dixon Electric. As a result of her continuing pain and physical limitations following the second surgery, she worked for Dixon only about 12 hours a week. During this period, Unum paid to Holt partial disability benefits under the policy based upon her working in her normal occupation on a part-time basis.
Upon further follow up inquiry, Unum learned in June 1992 that Dr. Hermansdorfer had released Holt to return to work full-time as a bookkeeper. Unum then advised Holt that she would need to obtain full-time work. The Court finds from the evidence that Holt attempted to work full-time, but experienced a worsening of the problems with her shoulder. Holt then returned to Dr. Hermansdorfer to advise him that she did not believe she could engage in full-time employment. In July 1992, Dr. Hermansdorfer concluded that Holt could not work full-time and advised Unum that he was releasing her only for part-time work. That conclusion was based upon Holt’s medical complaints that she experienced significantly increased levels of pain after working 5 to 6 hours in a given day. From July 1992 through 1993, Unum continued to pay partial disability benefits to Holt.
Holt was involved in a second motor vehicle accident in November 1993. As a result of that accident, she ceased working as a bookkeeper and again claimed complete disability. In February 1994, Unum advised Holt that she would be required to provide proof of ongoing disability in order to continue receiving her disability payments. Holt then provided Unum with information concerning her ongoing orthopedic treatment as well as information concerning treatment for a newly diagnosed condition known as “Graves Disease”, a thyroid abnormality. After treatment for her Graves Disease, Holt’s treating physician for that condition concluded that the Graves Disease itself would not have prevented Holt’s return from work after July 1994. Unum then agreed to pay Holt’s disability benefits through July 1994 and advised her that proof of a continuing disability was necessary in order for her to receive ongoing benefits after that date.
Holt pursued an administrative appeal of Unum’s denial of her benefits after July 1994 and demonstrated that she was scheduled for yet a third shoulder surgery in October 1994 for her continuing orthopedic problems. Unum then agreed to reverse its denial of benefits based upon that prospective surgery. Benefits were paid to Holt for her disability through January 11, 1995. During that time, Unum advised Holt once again that she would need to establish an ongoing disability in order to continue receiving her benefits.
Following the third surgery, Holt underwent approximately six weeks of physical therapy. At that point, she advised her physical therapist that she had realized some overall improvement in the range of motion of her shoulder and that her pain level had been substantially reduced.
Holt’s third surgery was performed orthoscopically by Dr. Anthony Lombardo. Unum contacted Dr. Lombardo’s office in January 1995 in an effort to determine whether Holt had any restrictions or limitations on her ability to return to work. Dr. Lombardo advised that Holt had been referred to a Dr. Jaffe for pain management in November 1994. Dr. Lombardo’s records show that he saw Holt on January 11, 1995, and noted that Holt continued to complain of substantial pain in her shoulder. He specifically stated that he would like to see her obtain a functional capacity evaluation (“FCE”) to see if she “can’t get back to some type of gainful employment”. The FCE was performed at the same facility as which Holt had undergone physical therapy for her shoulder. The FCE revealed that she did have some limited work capacity, could perform fine motor movements for 60 seconds at a time, could frequently sit for up to 75 minutes at a time, and frequently stand for up to 60 minutes at a time. The FCE also showed that she could perform limited typing for 10 minutes at a time on an “occasional” basis. Dr. Lombardo stated in one of his notes from an office visit that, based upon the FCE, Holt could not return to her previous work as a bookkeeper.
Unum then advised Holt in February 1995 that Unum would require a vocational review in order to determine whether the restrictions identified in the FCE would negatively affect Holt’s ability to return to work. At that point, Unum also advised that it would continue to pay benefits under a reservation of rights during the time of the investigation.
Unum’s vocational review was performed by a vocational rehabilitation specialist who based that review on the characterization of Holt’s job position as “staff accountant”. That designation of Holt’s position was based on her claim form and a form which was filled out by her original employer, the Dobson firm, as part of her initial claim. The Court finds that neither Holt nor Dobson were vocational experts and that they simply gave an incorrect label to Holt’s position. Nonetheless, the vocational reviewer concluded that the position involved “analyzing reports and data, computation, spreadsheet design and tracking, and researching tax code and other information”. The vocational review also noted that Holt’s position was not a data entry position and that any data entry which she may be required to do could be done by using her left hand when her right hand became tired or painful. The Court finds from the evidence that Holt’s position is more accurately described as a “full charge bookkeeper” under the dictionary of occupational titles, as testified to by Holt’s vocational rehabilitation expert. Indeed, the Court finds that Holt’s actual position requires sitting for extended periods of time doing data entry on a computer keyboard. For that reason, the Court further finds that Unum’s vocational review of Holt was fatally flawed by the initial mischaracterization of Holt’s job position.
Additionally, the conclusion in the vocational review that Holt could perform the tasks required of her position with her left hand rather than her right hand to relieve the stress on her right shoulder is not substantiated by the evidence. The Court finds from the testimony of Holt’s vocational rehabilitation expert that not every right-handed person can use their left hand with equal dexterity, and that a vocational specialist could not reach the conclusions apparent in Unum’s vocational review unless detailed testing was done to determine the patient’s ability to use her left hand and the ability to be trained to use that left hand. In short, nothing in the evidence other than the mere conclusion of Unum’s vocational reviewer supports Unum’s argument that Holt could be employed as a bookkeeper because she could be taught to use her left hand as equally well as her right hand.
After performing the vocational review, Unum’s reviewer suggested that Unum contact Dr. Lombardo to discuss the FCE with him and to discuss his understanding of Holt’s job duties. When Unum corresponded with Dr. Lombardo, he responded by providing a previous office treatment note which stated: “This shows that she is really unable to do the type of work which she did prior. That would be bookkeeping.”
Following the vocational review, Unum advised Holt in April 1995 that her claim for benefits was being denied because Unum had concluded that Holt had the capacity to return to her occupation of bookkeeping. Unum did, however, pay Holt a “transition benefit” through May 11, 1995, to assist her with a return to work.
Unum argues that its determination to terminate Holt’s disability benefits was justified because there is medical evidence to show that Holt was only partially disabled in May 1995. Unum basis its argument on Dr. Lombardo’s treatment note of May 8, 1995 in which he stated:
I feel she is probably able to return to a functional capacity in a limited part-time duty. I do not think she will be able to go back to work full-time since this aggravates her condition. In fact, any type of use with her right arm for any prolonged periods of time tend to cause more problems.
I would like her to return to work in a sedentary position according to the functional capacity evaluation restrictions, only part-time, three hours a day. In the future she may need continuation of pain management by Dr. Jaffe. There are no other changes in her restrictions.
Unum also points to a letter of May 31, 1995 addressed to Unum’s Kim Johnson by Dr. Jaffe in which Dr. Jaffe writes:
I would concur with your assessment that she should be able to return to work utilizing her left hand. I would caution you, though, that the level of stress and the need to use the right hand, might necessitate frequent rest and possibly only part-time return to work. I believe that her functional capacity evaluation done at the end of 1994 and the first of 1995, reported that she has difficulty doing any type of typing for prolonged periods and any type of reaching is also significantly limited. Sitting was limited to 75 minutes and standing to 60 minutes. Although we can do blocks to help reduce her level of pain, I would think that her returning to a bookkeeping job would, of necessity, have to be an extremely light duty type of position. As an example, perhaps with an extremely small business with low responsibility levels.
Notwithstanding the text of Dr. Lombardo’s treatment note and Dr. Jaffe’s letter, it is clear from the testimony of these physicians that their evaluations of Holt in May 1995 were based directly upon the FCE. As Holt’s expert testified in detail, the FCE did not accurately determine Holt’s ability to perform the duties of her bookkeeper’s position. Indeed, the Court finds that Dr. Lombardo’s testimony evidenced his overall opinion that Holt was only marginally employable, if at all, in May 1995. The Court finds that Dr. Lombardo’s treatment note and Dr. Jaffe’s letter so forcefully cited by Unum do not accurately portray the conclusions of these physicians because of the flawed nature of the FCE.
Following Unum’s final determination to terminate Holt’s disability benefits as of May 11, 1995, Holt took an administrative appeal of Unum’s denial. In that appeal, Unum determined that its decision to terminate benefits was correct and it upheld the denial of benefits.
II. LEGAL ANALYSIS AND CONCLUSIONS
As indicated in the introduction to this final judgment, this case is governed by ERISA. As Unum notes in its closing argument, Holt has the burden under ERISA of showing that Unum’s decision to terminate Holt’s benefits was incorrect. See Horton v. Reliance Standard Life Ins. Co., 141 F.3d 1038, 1040 (11th Cir. 1998). As accurately pointed out by Unum, Holt had to remain disabled as defined by her policy because the policy itself provides that benefits will be no longer payable on the date on which the insured is no longer disabled. The issue in this case, therefore, is whether Holt was disabled within the meaning of the policy in May 1995.
The policy defines both disability and partial disability as follows:
“Disability” and “Disabled” mean that because of injury or sickness the insured cannot perform each of the material duties of his regular occupation.
“Partial Disability” and “Partially Disabled” mean that because of injury or sickness, the insured, while unable to perform all of the material duties of his regular occupation on a full-time basis, is
(1) Performing at least one of the material duties of his regular occupation or another occupation on a part-time or full-time basis; and
(2) Earning currently at least 20% less per month than his indexed predisability earnings due to that same injury or sickness.
Thus, this Court must now determine based upon all of the evidence available to it whether Holt was disabled or partially disabled in May 1995 within the meaning of the foregoing policy language.
As both parties agree in their written closing arguments, this Court must utilize the de novo standard in reviewing Unum’s decision. Under that standard, the Court can review and reweigh all of the evidence to determine for itself whether Holt was suffering from a disability. See, Firestone Tire & Rubber Company v. Bruch, 489 U.S. 101 (1989).
In this case, the Court expressly concludes from the foregoing findings of fact that Holt was disabled within the meaning of the policy when Unum terminated her benefits on May 11, 1995. Thus, the Court finds that the Unum Administrator’s decision in denying Holt’s benefits was incorrect and is reversed.
Once a court determines that a denial of benefits under ERISA is incorrect, the Court must then fashion an appropriate remedy. Generally, a remand to the plan administrator is appropriate if the administrator has not had the opportunity to consider evidence on an issue. See Levinson vs. Reliance Standard Life Ins. Co., 245 F.3d 1321 (11th Cir. 2001). However, the opinion in Levinson points out that remand to the plan administrator is not appropriate in every case. In that case, the evidence showed that the plan participant was still disabled under the terms of the plan, his condition had not improved, and that he was still eligible for benefits. The Eleventh Circuit Court of Appeal explained that under these circumstances, remand to the plan administrator to determine the amount of benefits to which the plan participant would have been entitled was not necessary because such an action would have hindered the goal of judicial economy. A similar result was reached in Miller v. United Welfare Fund, 72 F.3d 1066 (2d Cir. 1995), a case in which the Court held that remand to the plan administrator with instructions to consider additional evidence was not required where no new evidence could produce a reasonable conclusion permitting denial of the claim. 72 F. 3d at 1073. See also, Grosz-Salomon v. Paul Revere Life Ins. Co., 237 F. 3rd 1154 (9th Cir. 2001) (holding that the de novo standard applied and that remand was not necessary where no practical purpose would be served by such an action).
In this case, it is clear that no practical purpose would be served by remanding this case to Unum for further findings concerning Holt’s condition as of May 11, 1995. This Court has concluded after a de novo review that Holt was disabled on that date and entitled to continuing benefits under her Unum policy. Given the volume of evidence presented at the trial of this case, there is certainly little, if any, additional evidence which could be considered by Unum’s administrator as to that point. Moreover, the evidence shows that Unum continued to gather its evidence through the final denial of Holt’s administrative appeal which concluded on September 26, 1995. The Court finds that none of that evidence would change the Court’s conclusion that Holt was disabled within the meaning of the policy as late as that date. The Court therefore finds that it is appropriate to remand this case to Unum with the following directions:
1. Unum’s decision to deny benefits is hereby reversed.
2. Unum shall pay benefits to Holt for total disability under the policy from May 11, 1995 through September 26, 1995.
3. Unum shall reconsider the denial of benefits from the period of September 27, 1995 to the present time.
Under ERISA the Court also finds that Holt, as the prevailing party in this litigation is entitled to the award of a reasonable attorney’s fee.
Based upon the foregoing, it is ORDERED AND ADJUDGED:
1. This case is hereby remanded to Unum for further proceedings and considerations consistent with this Final Judgment. Specifically, the following shall apply to such further proceedings and considerations:
(a) Unum’s decision to deny benefits to Holt as of May 1, 1995 is hereby reversed.
(b) Unum shall pay full disability benefits to Holt under the policy from May 11, 1995 through September 26, 1995, plus interest at the legal rate on each disability payment from the date such payment was due under the policy until the date of this judgment.
(c) Unum shall reconsider the denial of disability benefits to Holt for the period from September 27, 1995 to the present time.
2. Holt shall recover from Unum a reasonable fee for the services of her attorney in this case. The amount of such fees shall be established following a further evidentiary hearing before this Court.
3. This Court retains jurisdiction to review Unum’s compliance with the provisions of paragraph 1 of this Final Judgment and to determine the amount of attorney’s fees and costs awarded to Holt in paragraph 2 of this judgment.
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