Graham v. Hartford Life & Acc. Ins. Co.

• Decision Date: 29 December 2009
• Docket Number: No. 09-5043.,09-5043.
• Parties: Shirley A. GRAHAM, Plaintiff-Appellant, v. HARTFORD LIFE & ACCIDENT INSURANCE COMPANY, Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

589 F.3d 1345

Shirley A. GRAHAM, Plaintiff-Appellant, v. HARTFORD LIFE & ACCIDENT INSURANCE COMPANY, Defendant-Appellee.

No. 09-5043.

United States Court of Appeals, Tenth Circuit.

December 29, 2009.

Joseph F. Clark, Jr., Clark & Warzynski, P.A., Tulsa, OK, for Plaintiff-Appellant.

Timothy A. Carney, (Erin K. Dailey with him on the brief) Gable & Gotwals, Tulsa, OK, for Defendant-Appellee.

Before BRISCOE, McKAY, and HARTZ, Circuit Judges.

BRISCOE, Circuit Judge.

Plaintiff-Appellant Shirley Graham appeals the district court's adjudication of her claim for disability benefits under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001-1461. She raises three issues on appeal: (1) whether the district court properly determined that her disability benefits plan with Defendant-Appellee Hartford Life & Accident Insurance Co. ("Hartford") did not qualify as a "governmental plan" pursuant to 29 U.S.C. § 1002(32); (2) whether the district court properly determined that Graham was not entitled to a jury trial on her claim for benefits pursuant to 29 U.S.C. § 1132(a)(1)(B); and (3) whether the district court properly determined that Hartford's ultimate denial of disability benefits was not arbitrary and capricious. We have jurisdiction pursuant to 28 U.S.C. § 1291, and affirm.

I

From November 1976 until July 2000, Graham was an employee with the United States Postal Service ("USPS"). Administrative Record ("A.R.") at 544. She began her career as a Rural Letter Carrier, but due to physical health problems the USPS changed her position on June 7, 1997 to Modified Rural Carrier, a sedentary desk job that required intermittent walking, standing, and lifting. Id. at 196-97. Increased knee and ankle pain caused Graham to take a leave of absence on July 17, 2000 under the Family and Medical Leave Act. Id. at 496-99. The United States Office of Personnel Management ("OPM") granted her disability retirement on December 1, 2000. Id. at 453-54.

The Plan

The National Rural Letter Carriers Association ("NRLCA"), recognized by the USPS as the exclusive bargaining representative for rural letter carriers, offered its members a long term disability income protection plan. R. at 109-10. Although the NRLCA and USPS entered into a collective bargaining agreement, that agreement did not require the USPS to provide rural letter carriers with disability benefits. Id. at 271-72. To that end, the NRLCA contracted separately with Hartford to provide such a plan. It announced the plan to its members in the following letter:

Dear Member:

The [NRLCA] is pleased to offer a long term disability income protection plan for its regular rural carrier (Designation 71) members.

... Postal employees do not have a long term disability plan that is sponsored by the [USPS]. So, the NRLCA has worked diligently over the past several years to develop and sponsor a disability income plan for its regular carrier members.

...

The Plan is sponsored by the NRLCA and underwritten by [Hartford].

Id. at 109. The accompanying brochure indicated that the plan was "[u]nderwritten by" Hartford and "[a]rranged and [a]dministered by" the NRLCA's Group Insurance Department. Id. at 118. Though participation in the plan was completely voluntary, the brochure indicated that enrollment was available "only through government allotment."¹ Id. at 116. To request coverage, participating members needed to authorize the USPS to "make the appropriate deductions from [their] wages" and to release any information, including salary information, necessary for enrollment in and administration of the plan. Id. at 120. The Certificate of Insurance declared the NRLCA to be the policyholder, Hartford the issuer, and the USPS the employer. Id. at 126-27. Graham enrolled in the plan on January 28, 1997. A.R. at 489.

Pursuant to the terms of the plan, disability benefits become payable if:

1. you become Totally Disabled while insured under this plan;

2. you are Totally Disabled throughout the Elimination Period;

3. you remain Totally Disabled beyond the Elimination Period;

4. you are, and have been during the Elimination Period, under the Regular Care of a Physician; and

5. you submit Proof of Loss satisfactory to us.

Id. at 105. Under the plan, "Totally Disabled" means that

1. during the Elimination Period; and

2. for the next 24 month(s), you are prevented by:

a) accidental bodily injury;

b) sickness;

c) Mental Illness;

d) Substance Abuse; or

e) pregnancy,

from performing the Essential Duties of Your Occupation, and as a result you are earning less than 20% of your Predisability Earnings, unless engaged in a program of Rehabilitative Employment approved by us.

Id. at 116. The plan defines Elimination Period as the "period of time you must be Totally Disabled before benefits become payable." Id. at 102. The parties do not dispute that given the coverage option Graham selected, her Elimination Period started on July 16, 2000 and lasted until October 14, 2000.

Combining all these elements together, the essential question concerning Graham's entitlement to disability benefits is whether an accidental bodily injury prevented her from performing the Essential Duties² of her occupation from July 16, 2000 until October 14, 2000.

Medical History

When Graham began experiencing physical health problems, she became a patient of Dr. T. Jeffrey Emel, M.D., a doctor associated with the Eastern Oklahoma Orthopedic Center, Inc. ("Orthopedic Center"). On February 7, 1994, Graham twisted her right knee while delivering mail. Id. at 227. She injured that knee again the following month, and underwent surgery in July 1994. Id. Her knee pain persisted and she underwent another procedure in March 1997. Id. On April 18, 1997, a member of the Orthopedic Center wrote a letter to the United States Department of Labor's Office of Workers' Compensation Programs ("OWCP"). The letter recommended Graham for "sedentary work endeavors:" Graham "need[ed] to be primarily off her feet for the most part," and should be permanently restricted from "carrying mail" or "working up on her feet for any significant periods of time." Id. at 226. The USPS responded by moving Graham into a Modified Rural Carrier position on June 7, 1997. Id. at 196-97.

On October 25, 1998, Graham injured her left foot and ankle at home. Id. at 229-30. Dr. Emel diagnosed her with a "[g]rade 1+ deltoid sprain with lateral ankle sprain as well." Id. at 230. By November 1998, Graham was "making progress with her ankle." Id. at 232.

Graham experienced knee and ankle pain throughout 1999 and early 2000. By early 2000, however, her medical records indicate that her treatment had reduced the pain she was experiencing in both her ankle and knee. Although Graham's right knee was "symptomatic" in March 1999, id. at 233, and had "flared up again" in May 1999, id. at 234, Graham received an injection of corticosteroid and three injections of Synvisc in her right knee in November and December 1999, id. at 238-41. On January 11, 2000, Dr. Emel reported to the OWCP that the Synvisc injections provided "good relief;" by that point, Graham had "no swelling and actually the knee pain [was] significantly decreased." Id. at 242.

Graham's left ankle began "flar[ing] up" in August 1999. Id. at 235. Despite some improvements in September, Dr. Emel noted in October that Graham's ankle was "still swollen but becomes even more swollen and symptomatic if she is not taking her Vioxx." Id. at 236-37. When Graham's ankle was "still causing her pain" on January 11, 2000, Dr. Emel ordered an MRI, which revealed a "ganglion cyst." Id. at 243, 248-49. Graham underwent cyst removal and biopsy surgery in late February 2000. Id. at 257. Her follow-up evaluation on March 21, 2000 indicated that Graham "overall [was] doing significantly better in terms of her former discomfort." Id. at 260. In addition, the operating physician had indicated in his consultation notes that Graham would likely be able to return to work within weeks after this procedure. Id. at 249.

Graham's leave of absence commenced on July 17, 2000. Although Dr. Emel indicated in her Family and Medical Leave Act paperwork that Graham suffered from "ankle osteophytes, bone cyst, [and] osteoarthritis knees & ankles," id. at 497, the administrative record does not contain any other description of the change in Graham's condition after her March 21, 2000 follow-up evaluation. With respect to the Elimination Period and shortly thereafter, the administrative record reveals the following documentation:

• On July 26, 2000, Dr. Emel reported to the OWCP that Graham experienced "irritation in her knee." Noting that Graham's ankle surgery "caused her to have to bear more weight on the knee," and that "[h]er ambulation at work seems to exacerbate all this," Dr. Emel gave Graham's knee an injection and noted to check her after two weeks. Id. at 259.

• On July 28, 2000, Graham's ankle was "still having quite a bit of swelling." Dr. Emel gave Graham an injection and noted to check her after two weeks. Id. at 263.

• On August 10, 2000, Graham's ankle and knee had both "improved." Id. at 264-65. Dr. Emel suggested continuing Synvisc injections for her knee because "she does get good relief from that." Id. at 265.

• Graham received three more Synvisc injections on August 30, September 7, and September 15. Id. at 266-68.

• On October 13, 2000, Dr. Emel reported to the OWCP that Graham was "only minimally improved. The Synvisc [had] some sort of flare reaction after the last injection, although that subsided." Id. at 269. Dr. Emel continued her medication and treatment for a month.

• On November 10, 2000, Dr. Emel reported that Graham was "about the same. She is still not ready to return to work yet." Graham's knee was "hurting" despite the injections. Id. at 270.

• On November 15, 2000, Dr. Emel noted that Graham's "left ankle and left knee [were] both acting up." Id. at 271. X-rays revealed that the ankle...