Allen v. First Unum Life Ins. Co.

• Decision Date: 17 February 2022
• Docket Number: 2:18-cv-00069-JES-MRM
• Court: U.S. District Court — Middle District of Florida
• Parties: MARCUS ALLEN, M.D., Plaintiff, v. FIRST UNUM LIFE INSURANCE COMPANY, PROVIDENT LIFE AND CASUALTY INSURANCE COMPANY and THE UNUM GROUP, Defendants.

MARCUS ALLEN, M.D., Plaintiff,
v.
FIRST UNUM LIFE INSURANCE COMPANY, PROVIDENT LIFE AND CASUALTY INSURANCE COMPANY and THE UNUM GROUP, Defendants.

No. 2:18-cv-00069-JES-MRM

United States District Court, M.D. Florida, Fort Myers Division

February 17, 2022

OPINION AND ORDER

JOHN E. STEELE, SENIOR UNITED STATES DISTRICT JUDGE

This matter comes before the Court on review of the parties' cross Motions for Summary Judgment on Counts 1 and 2 of the Second Amended Complaint (Docs. ##145, 148). Responses in Opposition (Docs. ##154, 155) were filed, as were Replies (Docs. ##159, 160). In addition, Plaintiff filed a Motion for Summary Judgment on Defendants' First, Fourth, and Fifth Affirmative Defenses (Doc. #149), to which Defendants filed a Response in Opposition (Doc. #153) and Plaintiff filed a Reply (Doc. #161).

For the reasons set forth below, Defendants' motion for summary judgment is granted in part and denied in part. Plaintiff's cross-motion for summary judgment is denied, but his motion for summary judgment on Defendants' affirmative defenses is granted in part and denied in part.

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I.

This case involves a dispute concerning five disability income insurance policies covering Dr. Marcus Allen (Plaintiff or Dr. Allen) issued by Provident Life and Casualty Insurance Company (Provident) or First Unum Life Insurance Company (First Unum) and The Unum Group (Unum Group). Four of the policies are individual disability insurance policies (the Individual Policies), while the fifth policy is a group disability insurance policy (the Group Policy), (collectively the Policies). (Doc. #87, ¶¶ 17-45.)

The operative pleading is the Second Amended Complaint (SAC) (Doc. #87), and the only remaining claims are two counts of breach of contract (Counts 1, 2). In Count 1 of the SAC, Plaintiff asserts a state law claim of breach of contract against defendants Provident and Unum Group, alleging he has been and remains totally disabled and is owed unpaid benefits under the four Individual Policies. (Id., p. 29.) Count 2 of the SAC alleges a state law breach of contract claim against defendants First Unum and The Unum Group, claiming that Plaintiff's benefits under the Group Policy were wrongfully terminated. (Id., p. 32.)

Defendants argue they are entitled to summary judgment as to Counts 1 and 2 because the undisputed material facts show Plaintiff's claims are preempted by the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. (ERISA), and First Unum's decision to terminate Plaintiff's disability benefits under

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the Group Policy was not arbitrary or capricious. (Doc. #145, p. 2.) Plaintiff, on the other hand, argues that none of the Policies are governed by ERISA, and he is entitled to summary judgment on both his state-law claims because Defendants have provided no evidence to suggest he is no longer disabled or was no longer disabled when his disability benefits were terminated. (Doc. #148, pp. 1-2.) Additionally, Plaintiff asserts that he is entitled to summary judgment with respect to Defendants' First, Fourth, and Fifth Affirmative Defenses because as a matter of law the Policies are not governed by ERISA. (Doc. #149, p. 3.)

II.

Motions for summary judgment should only be granted when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, show "there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). "An issue of fact is `genuine' if the record taken as a whole could lead a rational trier of fact to find for the nonmoving party." Baby Buddies, Inc. v. Toys "R" Us, Inc., 611 F.3d 1308, 1314 (11th Cir. 2010). A fact is "material" if it may affect the outcome of the suit under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986) . "A court must decide `whether the evidence presents a sufficient disagreement to require submission to a jury or whether

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it is so one-sided that one party must prevail as a matter of law.'" Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260 (11th Cir. 2004) (quoting Anderson, 477 U.S. at 251).

In ruling on a motion for summary judgment, the Court views all evidence and draws all reasonable inferences in favor of the non-moving party. Scott v. Harris, 550 U.S. 372, 380 (2007); Tana v. Dantanna's, 611 F.3d 767, 772 (11th Cir. 2010). However, "if reasonable minds might differ on the inferences arising from undisputed facts, then the court should deny summary judgment." St. Charles Foods, Inc. v. America's Favorite Chicken Co., 198 F.3d 815, 819 (11th Cir. 1999)(quoting Warrior Tombigbee Transp. Co. v. M/V Nan Fung, 695 F.2d 1294, 1296-97 (11th Cir. 1983)(finding summary judgment "may be inappropriate even where the parties agree on the basic facts, but disagree about the factual inferences that should be drawn from these facts.")). "If a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, then the court should not grant summary judgment." Allen v. Bd. of Pub. Educ, 495 F.3d 1306, 1315 (11th Cir. 2007) .

Cross motions for summary judgment do not change the standard. See Am. Bankers Ins. Grp. v. United States, 408 F.3d 1328, 1331 (11th Cir. 2005). Cross motions for summary judgment are to be treated separately; the denial of one does not require the grant

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of another. See id. Even where the parties file cross motions pursuant to Rule 56, summary judgment is inappropriate if disputes remain as to material facts. United States v. Oakley, 744 F.2d 1553, 1555 (11th Cir. 1984) .

III.

As relevant to the current motions, the undisputed material facts are as follows:

Dr. Allen became a board-certified radiologist in 1984. In March 1986, Dr. Allen began working as a diagnostic radiologist at Prospect Hill Radiology Group, P.C. (Prospect Hill) in Syracuse, New York. While working at Prospect Hill, Dr. Allen purchased four individual, long-term disability income insurance policies from Provident through its agent David Schultz in Syracuse, New York.^[1] (Doc. #87, ¶¶ 7, 17, 21-24; Docs, ##87-l; 87-2; 87-3; 87-4.) Dr. Allen personally paid all premiums due on the Individual Policies. (Doc. 43-1, ¶ 35-38.)

Effective June 1, 2005, defendant First Unum issued a Group Policy to Prospect Hill which provided long term disability insurance coverage to the "Partners" of Prospect Hill. (Doc. #87, ¶ 38; Doc. #87-5, p. 3.)

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Prospect Hill paid all premiums on the Group Policy. (Doc. #43-1, ¶¶ 41-43.)

In May 2010, Dr. Allen experienced a "sudden change" in his vision that affected his ability to conduct the acute visual analysis required of a diagnostic radiologist. (Doc. #87, ¶¶ 47-49.) After he was examined by three physicians, Dr. Allen was diagnosed with "ocular degeneration, posterior vitreous detachment with retinal tear, bleed in his left eye, as well as significant floaters and visual disturbances in both eyes detrimentally impacting his visual field." (Id. at ¶¶ 50-51; Doc. #147-1, p. 350.) Dr. Allen resigned from his radiology practice on June 23, 2010, and filed a claim for disability benefits with Defendants, asserting that he became totally disabled as of May 1, 2010. (Doc. #87, ¶¶ 51-55.) At the time, Dr. Allen was fifty-six years old.

After reviewing Dr. Allen's documentation in support of disability, Defendants determined he was totally disabled under the Policies. (Id. at ¶¶ 56-57.) On or about January 15, 2011, Defendants began paying Dr. Allen 60% of his monthly earnings up to the "Maximum Monthly Amount" of $15, 000. (Id. at ¶¶ 42, 59; Doc. #147-1, pp. 478-83.)

While paying disability benefits, Defendants requested Dr. Allen's medical records as part of periodic medical reviews. These medical records revealed that Dr. Allen suffered from floaters and

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glare that impacted his vision and ability to read x-rays. (Doc. #87, ¶¶ 70-71.)

Dr. Allen was also required by Unum to apply for Social Security disability benefits, and did so on June 13, 2011. (Doc. #87, ¶ 72; Doc. #147-9, p. 296.) In 2013, the Social Security Administration (SSA) required Plaintiff to undergo a physical examination, and his medical records and file were reviewed by several physicians and a vocational expert. (Doc. #87, ¶ 76.) On June 28, 2013, the SSA determined that Dr. Allen had a "severe impairment" and was incapable of performing the occupation of diagnostic radiologist since June 2010, but that he could "engage in any other kind of substantial gainful work . . . ." (Doc. #87, ¶¶ 77, 101; Doc. #147-9, pp. 299-303.) In November 2013, Dr. Allen moved to Naples, Florida. (Doc. #148-1. P. 7.)

Defendants also required Dr. Allen to undergo additional Independent Medical Examinations (IMEs) with two physicians of their choosing. (Doc. #87, ¶¶ 105-06.) The IMEs found evidence of floaters and visual disturbances in Dr. Allen's eyes that impacted his field of vision. Defendants determined, however, that there was no objective medical evidence to support the continued existence of disability. (Id. at ¶¶ 107-08, 110, 114.)

On August 31 and September 1, 2015, after paying disability benefits for approximately five years, Defendants terminated Dr. Allen's disability benefits under his Individual and Group

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Policies. (Id. at ¶¶ 113, 134.) Dr. Allen appealed the benefit termination decision through Defendants' internal appeal process. On February 24, 2016, Defendants upheld the decision to terminate Plaintiff's benefits under all the Policies. (Id. at ¶¶ 120-21.)

Additional facts will be discussed as necessary to resolve specific issues.

IV.

The crux of Defendants' summary judgment motion is that the state-law breach of contract claims in both Counts 1 and 2 are defensively preempted by...