Arthurs v. Metropolitan Life Ins. Co.

• Citation: 760 F. Supp. 1095
• Decision Date: 15 April 1991
• Docket Number: No. 90 Civ. 4597 (RWS).,90 Civ. 4597 (RWS).
• Parties: Catherine ARTHURS, Plaintiff, v. METROPOLITAN LIFE INSURANCE COMPANY and the Prudential Insurance Company of America, Defendants.
• Court: U.S. District Court — Southern District of New York

760 F. Supp. 1095

Catherine ARTHURS, Plaintiff, v. METROPOLITAN LIFE INSURANCE COMPANY and the Prudential Insurance Company of America, Defendants.

No. 90 Civ. 4597 (RWS).

United States District Court, S.D. New York.

April 15, 1991.

O'Donnell & McLaughlin, Staten Island, N.Y. (Alan M. McLaughlin, of counsel), for plaintiff.

William J. Toppeta, New York City, for defendants.

OPINION

SWEET, District Judge.

Defendant Metropolitan Life Insurance Company ("Metropolitan") has moved for summary judgment dismissing the complaint of plaintiff Catherine Arthurs ("Arthurs"). For the following reasons, the motion is denied.

THE PARTIES

Arthurs is the widow of Raymond Arthurs, who was, at the time of his death, employed as a splicer by the Consolidated Edison Company of New York, Inc. ("Con Ed"). Mr. Arthurs died on June 17, 1986, following his collapse while working in a Con Ed "vault" at the Port Authority Terminal in New York City.

Metropolitan is an insurance company licensed to do business in New York. Metropolitan insures a Group Life Insurance Plan ("the Plan") provided by Con Ed to its employees. Mr. Arthurs was covered by the Plan at the time of his death.

Prudential Insurance Company of America ("Prudential"), not a party to the present motion, is also an insurance company licensed to do business in New York. Prudential insured Mr. Arthurs under two individual life insurance policies.

PRIOR PROCEEDINGS

Following her husband's death, Arthurs sought to collect on his life insurance policies and also filed a claim for workers' compensation. Over objection from Con Ed, the Workers' Compensation Board granted her claim, finding that Mr. Arthurs "would not have died ... if he had not been working in a hot closed vault." The Board therefore concluded that he had "sustained an accident arising out of and in the course of his employment and the subsequent death was causally related."

Both insurance companies paid Arthurs the basic death benefits due to her, but refused to pay the additional accidental death benefits called for under the policies. Arthurs therefore sued the insurers in New York State Supreme Court in May 1990 for breach of the insurance contracts. Metropolitan removed the case to this Court pursuant to 28 U.S.C. § 1441(c), asserting that because Arthurs' claim against it related to an employee benefit plan governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461, federal question jurisdiction existed.

On December 5, 1990, Metropolitan moved for summary judgment dismissing the complaint. Oral argument on the motion was heard on January 14, 1991.

THE FACTS

The Summary Plan Description dated July 1984 ("the Summary"), which was distributed to covered Con Ed employees pursuant to ERISA, 29 U.S.C. § 1022, states

In addition to any other benefits which you may receive, accidental death or dismemberment benefits will be paid for bodily injury sustained on or off the job while insured for this coverage and caused solely through violent, external and accidental means which results in death or the loss of hand, foot, or sight or eye.

....

Benefits are paid when the death or loss takes place within 90 days after the injury and is not caused in whole or in part from disease, bodily or mental infirmity, hernia, insurrection, intentionally self-inflicted injury, or any act of war.

Summary at 4 (emphasis added).

Both parties appear to agree that Mr. Arthurs died as a result of a heart attack. Arthurs claims that the attack was brought on by his working for several hours in the enclosed vault where the temperature exceeded 110 degrees, while Metropolitan argues that a pre-existing disease or bodily infirmity, namely coronary arteriosclerosis, was at least partially responsible for the collapse and death, which excuses it from paying the accidental death benefits.

Mr. Arthurs' death certificate contains the following entries:

a. Immediate cause:

Occlusive coronary arteriosclerosis.

b. Due to or as a consequence of:

Pending further study.

His autopsy report states "Coronary arteries exhibit moderate arteriosclerosis. There is a 50 to 60% stenosis of the anterior descending branch of the left coronary artery." The report concludes that the cause of death was occlusive coronary arteriosclerosis, and states that it was "natural."

In the proceedings before the Workers' Compensation Board, Con Ed relied on the opinion of Dr. Nathaniel E. Reich ("Reich"), who examined the medical file, including the death certificate and autopsy report and concluded that "It is apparent that Mr. Arthurs dies as a result of the natural and spontaneous progression of the coronary artery disease and his work had no effect upon his condition...." Dec. 5, 1990 Affidavit of Christine Rowlands ("Rowlands Aff.") Exhibit F at 9. Arthurs' own medical expert was Dr. Seymour S. Cutler ("Cutler"), who concurred with the medical examiner's finding that the cause of death was occlusive coronary arteriosclerosis, and stated "I believe that superimposed upon this pre-existing occlusive disease, the strenuous work activities precipitated a sudden cardiac arrhythmia which proved fatal."

DISCUSSION

1. Arthurs Has Stated a Claim for Relief Under ERISA.

Metropolitan seeks to dismiss Arthurs' state law claim for breach of the insurance contract as preempted by ERISA. While the preemption analysis is correct, the appropriate remedy is not to dismiss of the claim but rather to treat it as a claim made under ERISA. 29 U.S.C. § 1132(a)(1)(B).¹See, e.g., Guisti v. General Electric Co., 733 F.Supp. 141, 145 (N.D. N.Y.1990) (treating removed state law claim as properly stating claim under ERISA); Howard v. Gleason Corp., 716 F.Supp. 740 (W.D.N.Y.1989) (preemption requires denial of motion to remand to state court, not dismissal of state law claim), aff'd, 901 F.2d 1154 (2d Cir.1990).

2. Metropolitan's Denial of Accidental Death Benefits Must be Reviewed De Novo.

Metropolitan asserts that its determination that Arthurs is not entitled to accidental death benefits must be reviewed under an "arbitrary and capricious" standard, while Arthurs claims that a de novo review is called for. In Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989), the Supreme Court held that a claim for denial of benefits under 29 U.S.C. § 1132(a)(1)(B) should generally be reviewed de novo. However, in those cases in which the plan administrator had been granted discretionary authority to determine eligibility for benefits and to construe the terms of the plan, the more deferential "arbitrary and capricious" standard was appropriate. 489 U.S. at 110-15, 109 S.Ct. at 953-56. Although the Court did not explicitly deal with the standard of proof required, its use of the de novo standard as the default, together with its citation of ERISA's purpose "to promote the interests of employees and their beneficiaries" and "to protect contractually defined benefits," 489 U.S. at 113, 109 S.Ct. at 955 (quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 90, 103 S.Ct. 2890, 2896, 77 L.Ed.2d 490 (1983) and Massachusetts Mutual Life Ins. Co. v. Russell, 473 U.S. 134, 148, 105 S.Ct. 3085, 3093, 87 L.Ed.2d 96 (1985)), implies that in order to qualify for the more deferential standard, a plan administrator bears the burden of establishing that it does wield discretionary authority over benefits decisions. See Moon v. American Home Assurance Co., 888 F.2d 86, 88-89 (11th Cir. 1989); Baxter v. Lynn, 886 F.2d 182, 187 (8th Cir.1989); Brown v. Ampco-Pittsburgh Corp., 876 F.2d 546, 550 (6th Cir. 1989). In making this determination, any ambiguities must be construed against the administrator and in favor of the party seeking judicial review, particularly in a situation (such as the present one) where the plan administrator is also the party responsible for paying the benefits at issue. Guisti, supra, 733 F.Supp. at 141; cf. Firestone, 489 U.S. at 115, 109 S.Ct. at 956 (conflict of interest of plan administrator may be relevant to determining whether abuse of discretion exists).

Metropolitan has not pointed to any language in the Summary to supports its position. The portion of the Summary cited in support of its claim to discretionary authority reads

How to File Claims

All claim forms needed to file for benefits under the Group Insurance program can be obtained from Benefits Planning and Administration, Room 947-S, 4 Irving Place, who will also be ready to answer questions about the insurance benefits and to assist in filing claims.

The completed claim form should be returned to Benefits Planning and Administration, who will certify coverage under the plan and will then forward the claim form to the Metropolitan Life Insurance Company.

If any benefits are denied a written explanation will be provided.

Summary at 6. Nothing in this section grants Metropolitan discretionary authority to rule on eligibility for benefits. On the other hand, the section cited earlier providing for accidental death benefits states that such benefits "will be paid," with no requirement that Metropolitan must agree to the payment. See Heidgerd v. Olin Corp., 906 F.2d 903, 908 (2d Cir.1990) (no grant of discretion where plan summary provided "you will receive severance" and "benefits are payable") (emphasis in Heidgerd).

Metropolitan has supported its claim to discretionary authority by referring to the review process by which it handled Arthurs' claim, which it asserts is the typical way in which such claims are handled. However, this purported review process merely consisted of denying the claim and informing Arthurs that she had a right to appeal the decision to Metropolitan, a right which Arthurs declined to exercise, choosing to file suit instead. Metropolitan has offered no evidence that this "review process" is authorized by or even contemplated by the Plan itself.²

The section of the Summary identified as "Statement of ERISA Rights"...