Viera v. Life Ins. Co. of North Am..

• Decision Date: 10 June 2011
• Docket Number: No. 10–2281.,10–2281.
• Parties: Hetty A. VIERA, as Executrix of the Estate of Frederick A. Viera; Hetty A. Viera, Individually, Appellantsv.LIFE INSURANCE COMPANY OF NORTH AMERICA.
• Court: U.S. Court of Appeals — Third Circuit

642 F.3d 407

Hetty A. VIERA, as Executrix of the Estate of Frederick A. Viera; Hetty A. Viera, Individually, Appellants

v.LIFE INSURANCE COMPANY OF NORTH AMERICA.

No. 10–2281.

United States Court of Appeals, Third Circuit.

Argued April 13, 2011.Filed: June 10, 2011.

James W. Sutton, III (Argued), Vlasac & Shmaruk, Feasterville, PA, for Appellant.Mark C. Cawley, James A. Keller (Argued), Allison B. Newhart, Saul Ewing, Philadelphia, PA, for Appellee.Before: FISHER, JORDAN and COWEN, Circuit Judges.

OPINION OF THE COURT

FISHER, Circuit Judge.

This appeal arises out of the 2008 death of Frederick Viera (“Viera”) in a head-on motorcycle accident. At the time of his death, Viera was covered under an employer-provided accidental death and dismemberment policy (“Policy”), issued by Life Insurance Company of America (“LINA”), and subject to the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. §§ 1101 et seq. Viera's wife and the executrix of his estate, Hetty Viera (“Plaintiff”), submitted a claim under the Policy following his death. LINA denied Plaintiff's claim, both initially and on appeal. Subsequently, Plaintiff filed suit, but the United States District Court for the Eastern District of Pennsylvania found for LINA on cross-motions for summary judgment. It concluded that the Policy gave LINA discretionary authority to determine eligibility. It therefore reviewed LINA's decision under a deferential abuse-of-discretion standard and held that LINA was entitled to summary judgment. We conclude that deferential review was not appropriate, given the language of the Policy, and thus remand for further proceedings.

I.

A. Factual History

On October 14, 2008, Viera was seriously injured in a motorcycle accident in Grand Junction, Colorado. He was treated at St. Mary's Hospital and Medical Center (“St. Mary's”) for approximately three hours and subsequently died.

On the date of his death, Viera maintained the Policy, an employer-provided accidental death and dismemberment policy regulated under ERISA. ¹ The Policy was issued and administered by LINA.

Viera had a pre-existing chronic condition known as atrial fibrillation, which was diagnosed prior to LINA's issuing the Policy. As part of the medical treatment for this condition, Viera received medication called Coumadin (also known as Warfarin). Coumadin is a prescription oral anticoagulant drug prescribed for the prevention and treatment of blood clots.

Following Viera's motorcycle accident, doctors at St. Mary's made several findings regarding his treatment and death. For example, the Final Assessment made in the Emergency Report confirmed that Viera was “on Coumadin with therapeutic INR ² significantly complicating trauma management.” (App. at 160.) The Discharge Summary prepared by Dr. Michael Bradshaw of St. Mary's described Viera's death as caused by “multiple injuries in a head-on motorcycle versus car accident with severe pelvic fractures, lower extremity fractures, and a fully coumadinized patient due to atrial fibrillation.” ( Id. at 138.)

The Certificate of Death confirmed that the immediate cause of Viera's death was “multiple injuries,” and it ambiguously noted that “arteriosclerotic cardiovascular disease” was a “condition [ ] contributing to death but not related to [immediate cause].” ( Id. at 227.) The autopsy report, prepared by Robert A. Kurtzman, listed the immediate cause of death as “multiple injuries” and listed “other significant conditions” including “atrial fibrillation.” ( Id. at 237.)

Plaintiff submitted a claim for benefits under the Policy to LINA on November 3, 2008. LINA denied her claim. Key to this appeal is the language of several Policy provisions:

“Covered Loss”:

A loss that is all of the following:

1. the result, directly and independently of all other causes, of a Covered Accident;

2. one of the Covered Losses specified in the Schedule of Covered Losses;

3. suffered by the Covered Person within the applicable time period specified in the Schedule of Benefits.

( Id. at 78) (emphasis added).

“Covered Accident”:

A sudden, unforeseeable, external event that results, directly and independently of all other causes, in a Covered Injury or Covered Loss and meets all of the following conditions:

1. occurs while the Covered Person is insured under this Policy;

2. is not contributed to by disease, Sickness, mental or bodily infirmity;

3. is not otherwise excluded under the terms of this Policy.

( Id.)

“Proof of Loss”:

Written or authorized electronic proof of loss satisfactory to Us must be given to Us at Our office, within 90 days of the loss for which claim is made.

( Id. at 85) (emphasis added).

LINA denied Plaintiff's claim by finding that the specific circumstances of Viera's death did not constitute a covered event under the terms of the Policy. Specifically, LINA maintained that Viera's accident was excluded by the “Medical Condition Exclusion” of the Policy, which states that:

[B]enefits will not be paid for any Covered Injury or Covered Loss which, directly or indirectly, in whole or in part, is caused by or results from ... [s]ickness, disease, bodily or mental infirmity, bacterial or viral infection or medical or surgical treatment thereof, except for any bacterial infection resulting from an accidental external cut or wound or accidental ingestion of contaminated food.

( Id. at 83.) LINA concluded that Viera's Coumadin treatment complicated his medical treatment and constituted a contributing factor to his death. LINA relied on a report by Dr. Mark H. Eaton, a medical doctor it had retained to review the accident reports and hospital records. Dr. Eaton reviewed the hospital records, the autopsy report, and the official Death Certificate in reaching his conclusion. Dr. Eaton reported that:

The cause of Mr. Viera's death was attributed to the traumatic pelvic fracture which resulted in clinically significant pelvic and retroperitoneal hemorrhage complicated by the fact that the claimant was systematically anti-coagulated.... In my opinion [Viera's] Coumadin therapy significantly contributed to his death as it is more than likely he would have survived the traumatic pelvic fracture if he had not been fully anti-coagulated at the time of his injury.

( Id. at 124.) Plaintiff administratively appealed the denial of benefits in a written letter to LINA. She chose not to supplement the record with information supporting her claim at that time. LINA affirmed its decision to deny benefits.B. Procedural History

Plaintiff filed an ERISA action against LINA in the Court of Common Pleas of Philadelphia County, Pennsylvania. LINA removed the action to the United States District Court for the Eastern District of Pennsylvania pursuant to 28 U.S.C. §§ 1331 and 1441.³

In preparation for the litigation, Plaintiff hired an independent expert, Dr. Aaron J. Gindea, to conduct a review of the medical records. Dr. Gindea reported that:

The hospital staff did everything possible to reverse the [Coumadin] effect and limit the bleeding. Although the presence of [Coumadin] did make the bleeding worse, it is unreasonable to propose that, if not for the [Coumadin], the patient likely would have survived. Therefore, the patient's death WAS NOT directly or indirectly, in whole or in part, caused by or resulted from the [Coumadin] therapy. Rather, it was the result of severe trauma from a motor vehicle accident which would likely have been fatal in the presence of or the absence of [Coumadin].

( Id. at 320–21.)

The parties filed cross-motions for summary judgment. The District Court granted LINA's motion for summary judgment, denied Plaintiffs motion for summary judgment, and directed entry of judgment in favor of LINA. It found that LINA's denial of benefits was not an abuse of discretion. Plaintiff timely appealed and argues that the District Court should have reviewed LINA's decision de novo. In the alternative, she asserts that even under a deferential standard of review, a genuine issue of material fact exists such that summary judgment was inappropriate. Finally, she argues that the District Court misinterpreted the Medical Exclusion Provision of the Policy, which she maintains cannot be read to include atrial fibrillation or Coumadin treatment.

II.

A district court's determination of the proper standard to apply in its review of an ERISA plan administrator's decision is a legal conclusion which we review de novo. Grupo Protexa, S.A. v. All Am. Marine Slip, 20 F.3d 1224, 1231 (3d Cir.1994).

We review a district court's grant of summary judgment de novo, applying the same standard the district court applied. Alcoa, Inc. v. United States, 509 F.3d 173, 175 (3d Cir.2007). We also review the legal interpretation of contractual language de novo. Heasley v. Belden & Blake Corp., 2 F.3d 1249, 1254 (3d Cir.1993).

III.

A. Standard of Review of LINA's Benefits Denial

The Supreme Court has held that “a denial of benefits challenged under [ERISA] is to be reviewed under a de novo standard 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). If the plan gives the administrator or fiduciary discretionary authority to make eligibility determinations, we review its decisions under an abuse-of-discretion (or arbitrary and capricious) standard. ⁴ Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 111, 128 S.Ct. 2343, 171 L.Ed.2d 299 (2008); Doroshow v. Hartford Life & Accident Ins. Co., 574 F.3d 230, 233 (3d Cir.2009). “Whether a plan administrator's exercise of power is mandatory or discretionary depends upon the terms of the plan.” Luby v. Teamsters Health, Welfare, & Pension Trust Funds, 944 F.2d 1176, 1180 (3d Cir.1991). There are no “magic words” determining the scope of judicial review of decisions to deny benefits, and discretionary powers may be...