Edwards v. Briggs & Stratton Ret. Plan

Citation639 F.3d 355
Decision Date29 April 2011
Docket NumberNo. 09–2326.,09–2326.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)
PartiesAugusta EDWARDS, Plaintiff–Appellant,v.BRIGGS & STRATTON RETIREMENT PLAN, Defendant–Appellee.

OPINION TEXT STARTS HERE

Mark D. DeBofsky (argued), Attorney, Daley, DeBofsky & Bryant, Chicago, IL, for PlaintiffAppellant.Joseph O. Wilson (argued), Attorney, Quarles & Brady, Milwaukee, WI, for DefendantAppellee.Before TINDER and HAMILTON, Circuit Judges and MURPHY, District Judge.MURPHY, District Judge.*

I. Introduction

The issue presented by this appeal, which arises out of a suit brought by PlaintiffAppellant Augusta Edwards against DefendantAppellee Briggs & Stratton Retirement Plan (“the Plan”) for benefits due under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001 et seq., is straightforward: whether the Plan should have excused the fact that Edwards's administrative appeal from a denial of her claim for disability benefits by the Plan was approximately eleven days late. The issue concerns, of course, whether Edwards exhausted her administrative remedies as a predicate to filing suit under ERISA in federal court. Finding that Edwards failed to exhaust, the district court dismissed the case on summary judgment. Because we find no error in the district court's decision, the decision is affirmed.

II. Background and Procedural History

It is undisputed that the Plan is an employee welfare benefit plan and that Edwards is a participant in the Plan, all within the meaning of ERISA. See 29 U.S.C. § 1002(1), (7). Edwards, an employee of the Wisconsin-based Briggs & Stratton Company (Briggs & Stratton), ceased working in November 2005 due to a variety of ailments, including cervical radiculopathy, bilateral carpal tunnel syndrome, and ulnar nerve compression. Edwards was treated by, inter alia, Dr. James Stoll, an orthopedic surgeon. On August 9, 2007, Edwards made a claim for disability retirement benefits under the Plan, basing the claim upon Stoll's opinion that Edwards is totally and permanently disabled, cannot return to Briggs & Stratton, and cannot perform any work at all. The Plan retained its own medical consultant, Dr. Richard Fritz, a specialist in internal medicine, to evaluate Edwards's claim. Fritz opined that Edwards is not totally and permanently disabled. On September 26, 2007, the Plan denied Edwards's claim for disability retirement benefits and on September 29, 2007, Edwards was notified of the denial of her claim. The letter informing Edwards of the denial of her claim advised Edwards that she had 180 days from receipt of the letter to appeal the denial of benefits to the Plan's Retirement Committee. The requirement that an appeal from a denial of Plan benefits must be made within 180 days from receipt of a denial letter is contained in the Plan document.

On October 9, 2007, Edwards wrote to the Plan to request copies of the records relied upon by the Plan in denying her claim for benefits and advised the Plan that [a]fter I get these things [the records], I'll decide whether or not to appeal.” Upon receipt of the records as requested, Edwards retained counsel to bring an appeal to the Plan from the denial of her claim for benefits. On February 4, 2008, the Plan received a letter from Edwards's counsel requesting a copy of the Plan document and advising the Plan that Edwards's counsel would be filing an administrative appeal on Edwards's behalf “soon.” On February 8, 2008, Elizabeth Mlekush, the Plan administrator, answered the letter, sending a copy of the Plan document as requested and advising Edwards's counsel that Edwards's appeal letter must be received by the Plan by March 31, 2008. 1

After receiving a vocational report, dated March 27, 2008, from Anne Repaci, Edwards brought her appeal to the Plan. Edwards's appeal letter was supported by Repaci's report and a medical assessment of Edwards by Stoll dated September 11, 2007, and opened by saying, We [Edwards and her counsel] hereby appeal your September 26, 2007 decision.” Unfortunately, Edwards's appeal letter was not received by the Plan until April 11, 2008, that is, eleven days after the March 31 deadline specified by Mlekush in her letter of February 8, 2008, and fifteen days after the actual deadline of March 27, 2008. In the appeal letter, Edwards acknowledged that her appeal was untimely, but offered no explanation for the delay in bringing the appeal. The Plan refused to consider Edwards's appeal on the grounds that the appeal was untimely. The letter informing Edwards of the original denial of her claim for benefits advised Edwards that she had the right to bring an action under ERISA following an adverse determination of her claim for benefits on appeal. On June 9, 2008, Edwards filed suit against the Plan pursuant to 29 U.S.C. § 1132(a)(1)(B) in federal district court in Milwaukee, Wisconsin. With the consent of the parties, the case was assigned to a magistrate judge for disposition. On cross-motions for summary judgment, the magistrate granted summary judgment for the Plan and denied Edwards's motion for summary judgment. This appeal followed.

III. Analysis

As an initial matter, we note the applicable standard of review. A grant of summary judgment is reviewed de novo. See Ruiz v. Continental Cas. Co., 400 F.3d 986, 989 (7th Cir.2005). Summary judgment is appropriate when “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Where, as here, the district court was faced with cross-motions for summary judgment, “our review of the record requires that we construe all inferences in favor of the party against whom the motion under consideration is made.” Hendricks–Robinson v. Excel Corp., 154 F.3d 685, 692 (7th Cir.1998).

A denial of benefits normally is reviewed de novo “unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.” Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). In such a case, the denial of benefits is reviewed under an “arbitrary and capricious” standard. Hess v. Reg–Ellen Mach. Tool Corp. Employee Stock Ownership Plan, 502 F.3d 725, 727 (7th Cir.2007). 2 Under the arbitrary and capricious standard, the reviewing court must ensure only that a plan administrator's decision “has rational support in the record.” Semien v. Life Ins. Co. of N. Am., 436 F.3d 805, 812 (7th Cir.2006). “Put simply, an administrator's decision will not be overturned unless it is ‘downright unreasonable.’ Davis v. Unum Life Ins. Co. of Am., 444 F.3d 569, 576 (7th Cir.2006) (quoting Sisto v. Ameritech Sickness & Accident Disability Benefit Plan, 429 F.3d 698, 700 (7th Cir.2005)). However, [r]eview under the deferential arbitrary and capricious standard is not a rubber stamp and deference need not be abject.” Hackett v. Xerox Corp. Long–Term Disability Income Plan, 315 F.3d 771, 774 (7th Cir.2003). Nevertheless, we will uphold the plan's decision “as long as (1) ‘it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome,’ (2) the decision ‘is based on a reasonable explanation of relevant plan documents,’ or (3) the administrator ‘has based its decision on a consideration of the relevant factors that encompass the important aspects of the problem.’ Hess v. Hartford Life & Accident Ins. Co., 274 F.3d 456, 461 (7th Cir.2001) (quoting Exbom v. Central States, Se. & Sw. Areas Health & Welfare Fund, 900 F.2d 1138, 1142–43 (7th Cir.1990)).

Under ERISA, [a] civil action may be brought ... by a participant ... to recover benefits due to 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 terms of the plan.” 29 U.S.C. § 1132(a)(1)(B). Although 29 U.S.C. § 1132(a)(1)(B) “provide[s] that an aggrieved party may file a civil action to redress alleged ERISA violations, [the statute] do[es] not state whether exhaustion of administrative remedies is a precondition to filing that action.” Dale v. Chicago Tribune Co., 797 F.2d 458, 466 (7th Cir.1986). However, because ERISA directs employee benefit plans to provide adequate written notice of the reasons for denials of claims by plan participants and to create procedures for the review of such denials of claims, we have interpreted ERISA as requiring exhaustion of administrative remedies as a prerequisite to bringing suit under the statute. See Powell v. A.T. & T. Commc'ns, Inc., 938 F.2d 823, 826 (7th Cir.1991) (citing 29 U.S.C. § 1133).

The requirement of exhaustion of administrative remedies in ERISA cases serves several purposes. Exhaustion encourages informal, non-judicial resolution of disputes about employee benefits. [T]he institution of ... administrative claim-resolution procedures was apparently intended by Congress to help reduce the number of frivolous lawsuits under ERISA; to promote the consistent treatment of claims for benefits; to provide a nonadversarial method of claims settlement; and to minimize the cost of claims settlement for all concerned.” Kross v. Western Elec. Co., 701 F.2d 1238, 1244–45 (7th Cir.1983) (quoting Amato v. Bernard, 618 F.2d 559, 567 (9th Cir.1980)). Congress intended fund trustees to have primary responsibility for claim processing, as evidenced by the specific requirement in [ERISA] ... of a claim and appeal procedure for every employee benefit plan. To make every claim dispute into a federal case would undermine the claim procedure contemplated by the Act.” Challenger v. Local Union No. 1 of Int'l Bridge, Structural & Ornamental Ironworkers, 619 F.2d 645, 649 (7th Cir.1980). [T]he trustees of covered benefit plans are granted broad fiduciary rights and responsibilities under ERISA ... and implementation of the exhaustion requirement ... enhance[s] their...

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