Barhan v. Ry-Ron Inc., RY-RON

• Decision Date: 05 September 1997
• Docket Number: RY-RON,No. 96-20782,96-20782
• Citation: 121 F.3d 198
• Parties: Constance J. BARHAN, Plaintiff-Appellant, v.INC., et al., Defendants, Charlie Thomas Chevrolet, Inc. & Affiliates Employee Benefit Plan and Allianz Life Insurance Company of North America, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 198

121 F.3d 198

Constance J. BARHAN, Plaintiff-Appellant, v. RY-RON INC., et al., Defendants Charlie Thomas Chevrolet, Inc. & Affiliates Employee Benefit Plan and Allianz Life Insurance Company of North America, Defendants-Appellees.

No. 96-20782.

United States Court of Appeals Fifth Circuit.

Sept. 5, 1997.

Michael F. Rafferty, Memphis, TN, for Plaintiff-Appellant.

William Fulton Broemer, Broemer & Associates, Houston, TX, Marta Kaye Hill, Broemer & Weisblatt, Houston, TX, for Charlie Thomas Chevrolet Inc. & Affiliates Employee Benefit Plan, Defendant-Appellee.

Don W. Davis, Dallas, TX, for Allianz Life Ins. Co., of North America, Defendant-Appellee.

Appeal from the United States District Court for the Southern District of Texas.

Before KING, DAVIS and DeMOSS, Circuit Judges.

W. EUGENE DAVIS, Circuit Judge:

Constance Barhan appeals from a district court's summary judgment order denying her insurance benefits under her employer's insurance plan. We affirmed in part, reversed in part and remand.

I.

In late 1992, Barhan was diagnosed with adjuvant breast cancer. Her doctor recommended that she receive high-dose chemotherapy with peripheral stem-cell support (HDCT/PSCS). Her medical provider requested approval of the treatment from Barhan's insurer, the Charlie Thomas Chevrolet, Inc. & Affiliates Employee Benefit Plan ("the Plan"). The plan administrator, citing exclusions in the plan for treatments not recognized by the American Medical Association and experimental or investigational procedures, denied coverage. ¹

Barhan filed suit against the Plan and Allianz Life Insurance Company of North America ("Allianz") seeking a declaratory judgment that the treatment ordered by her doctor was covered by the Plan and that she was deprived of the "full and fair review" of her claim required by ERISA, 29 U.S.C. § 1133(2). ² She also asked the court to order the Plan to pay for her treatment and enter a judgment for $30,124.44, the amount of unpaid medical expenses. The Plan and Allianz filed motions for summary judgment, which the district court granted.

II.

A.

On appeal, Barhan challenges the plan administrator's denial of coverage under § 502(a)(1)(B) of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1132(a)(1)(B), and contends that the district court erred in granting summary judgment upholding the denial of benefits.

We review the district court's holding on the question of whether the plan administrator abused its discretion de novo. Sweatman v. Commercial Union Ins. Co., 39 F.3d 594, 601 (5th Cir.1994). Summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). The moving party must identify evidence that establishes the absence of any genuine issue of material fact, Celotex Corp., 477 U.S. at 323, 106 S.Ct. at 2553, and the court reviewing a grant of summary judgment must evaluate the facts in the light most favorable to the nonmovant. Todd v. AIG Life Ins. Co., 47 F.3d 1448, 1451 (5th Cir.1995).

The district court reviews the denial of benefits for abuse of discretion when the terms of a benefit plan governed by ERISA give the plan administrator discretionary authority to determine eligibility for benefits. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989); Duhon v. Texaco, Inc., 15 F.3d 1302, 1305-06 (5th Cir.1994). The benefit plan here provides that, "[t]he Administrator has the sole authority and responsibility to review and make final decisions on all claims to benefit hereunder." This language grants the plan administrator discretion; therefore, if the administrator's decision on eligibility is supported by substantial evidence and is not erroneous as a matter of law, it will be upheld. Wildbur v. ARCO Chemical Co., 974 F.2d 631, 637 n. 12 (5th Cir.1992).

B.

To support its motion for summary judgment, the Plan submitted various documents and affidavits. The district court did not assess this evidence. Instead, it stated that in reviewing the plan administrator's decision, it was acting as an appellate court; accordingly, the district court determined, the parties were bound by the Federal Rules of Appellate Procedure. Under Rule 11(a), the appellant must designate the record to be reviewed. Fed. R.App. P. 11(a). The district court concluded that "it is Barhan's duty to provide the administrative record upon which the Plan made its decision" and that because Barhan failed to submit such a record, summary judgment for the Plan was appropriate.

We disagree. While the district court acts as a reviewing court when it examines a plan administrator's decision, we are not persuaded that the Federal Rules of Appellate Procedure apply. Neither the rules themselves nor ERISA provide for such an outcome. ³ Moreover, it is the plan administrator's responsibility to compile a record that he is satisfied is sufficient for his decision. See, e.g., 29 C.F.R. § 2560.503-1(f) (requiring that benefits claim denial include specific reference to plan provisions on which denial is based and description of additional material or information necessary to perfect claim for review). Therefore, as a practical matter, the plan administrator is ordinarily best-positioned to submit that administrative record. ⁴

We are persuaded that summary judgment is an appropriate procedural vehicle for the administrator to use in obtaining a resolution of the plan beneficiary's suit. Once the motion for summary judgment is filed, the usual summary judgment rules control. In this case and under those rules, the Plan bore the initial burden of informing the court of the basis for its motion and identifying those portions of the pleadings, depositions, affidavits or other factual support that demonstrate that it did not abuse its discretion in rejecting the beneficiary's claim. See Celotex Corp., 477 U.S. at 323, 106 S.Ct. at 2552-53. Thereafter, the nonmovant--here, Barhan--had to set forth factual support in proper form tending to show that the plan administrator was not entitled to summary judgment and/or that the nonmovant was entitled to summary judgment. See id. at 322-23, 106 S.Ct. at 2552-53.

In this case, the Plan, in support of its motion for summary judgment, submitted, among other documents: (1) the insurance policy containing the exclusionary language; (2) the initial letter refusing to authorize the treatment; (3) the affidavit of Dr. Charles Manner, Barhan's board-certified oncologist, recommending treatment; and (4) the affidavit of Jane Wolff, claims manager for the third-party administrator for the Plan. Wolff's affidavit states that the plan administrator reviewed coverage guides of various insurers and relevant articles in various medical journals; however, those articles were not attached. Wolff's affidavit also states that the plan administrator solicited the opinion of Dr. Giora Mavligit, but no affidavit of Dr. Mavligit was submitted. In her motion opposing summary judgment, Barhan relied on the affidavit from Dr. Manner, already in the record.

The district court concluded that it did not need to assess the plan administrator's factual basis for its decision because Barhan failed to supply an administrative record. This conclusion is inconsistent with rules governing summary judgment. Under those rules, despite our deferential standard of review, this record does not sufficiently demonstrate the plan administrator's entitlement to summary judgment. The only evidence put forth by the Plan in support of its position that the HDCT/PSCS treatment is...