Brant v. Principal Life and Disability Ins. Co., C 98-3064-MWB.
| Decision Date | 08 April 2002 |
| Docket Number | No. C 98-3064-MWB.,C 98-3064-MWB. |
| Citation | 195 F.Supp.2d 1100 |
| Parties | Carl E. BRANT, Plaintiff, v. The PRINCIPAL LIFE AND DISABILITY INSURANCE COMPANY and Armour Swift Eckrich, Defendants. |
| Court | U.S. District Court — Northern District of Iowa |
Carl E. Brant, pro se.
David Swinton, Ahlers, Cooney, Dorweiler, Haynie, Smith & Allbee, P.C., Des Moines, IA, for Principal Life.
Christopher M. Bikus, McGrath, North, Mullin & Katz, P.C., Omaha, NE, for Armour Swift-Eckrich.
TABLE OF CONTENTS
I. INTRODUCTION .......................................... 1103
A. Procedural Background .............................. 1103
B. Factual Background ................................. 1103
II. LEGAL ANALYSIS ....................................... 1105
A. Standards For Summary Judgment .................... 1105
1. Requirements of Rule 56 ........................ 1106
2. The parties' burdens ........................... 1107
B. What Record Can Be Considered? .................... 1108
C. Merits Of The Motions ............................. 1108
1. Termination of benefits ........................ 1108
a. Standard for judicial review ................ 1109
b. Application of the standard ................. 1110
2. Bars to termination of coverage ................ 1112
a. Promissory estoppel ......................... 1112
b. Misrepresentation ........................... 1113
i. Equitable estoppel ....................... 1113
ii. Breach of fiduciary duty ................. 1118
III. CONCLUSION .......................................... 1121
This matter comes before the court pursuant to the December 31, 2001, motion for summary judgment by defendant Armour Swift-Eckrich (ASE); the January 2, 2002, motion for summary judgment by defendant Principal Life and Disability Insurance Company (Principal Life); and the March 14, 2002, motion by plaintiff Carl Brant to quash ASE's Exhibit A in support of its summary judgment motion, which is excerpts of Mr. Brant's deposition. These motions have now been fully briefed and Principal Life's request for oral arguments on the motions for summary judgment has been withdrawn. Therefore, these motions are now ripe for consideration by the court. This matter is set for trial to begin on April 29, 2002.
Plaintiff Carl Brant, who is prosecuting this action pro se, originally filed this action on September 14, 1998, in the Iowa District Court for Cerro Gordo County, against his employer, ASE, and its insurance provider, Principal Life. In his complaint, Mr. Brant alleged the following claims: Count I alleged a claim under the Americans with Disabilities Act (ADA); Count II alleged a claim for life insurance benefits; and Count III alleged a claim for damages for "the pain and anguish of Plaintiff's family when faced with the possibility of Plaintiff's death and costs associated with Plaintiff's demise" as the result of a "brain aneurysm" Brant suffered, but from which he fortunately recovered.
Defendant ASE removed the action to this federal court on October 13, 1998. At various stages in the proceedings, the court either dismissed or granted summary judgment in favor of the defendants on each of Brant's claims. Upon Brant's appeal, the Eighth Circuit Court of Appeals affirmed dismissal of Counts I and III, but reinstated and remanded Brant's claim in Count II as a claim, under the Employee Retirement Income Security Act (ERISA), for reinstatement of his life insurance benefits, holding that Mr. Brant's employer and its insurance provider were proper defendants in such an action, because their administrative services agreement gave them discretionary authority to determine eligibility for benefits and to construe the terms of the plan. That remaining claim is now before the court on the defendants' motions for summary judgment.
The court will not attempt here an exhaustive dissertation of the undisputed and disputed facts in this case. Rather, the court will present sufficient of the facts, both disputed and undisputed, to put in context the parties' arguments for and against summary judgment on Brant's remaining claim for reinstatement of insurance benefits.
Brant worked for ASE as a supervisor in ASE's processed meat/packaged meat department until his employment was interrupted by health problems, including emphysema and an upper lung blockage, in September 1994. His last day of active employment was September 6, 1994. Brant was a participant in ASE's employee benefit plan, which provided, among other things, basic and supplemental life insurance and disability insurance. In 1995, Brant applied for long term disability benefits (LTD) under the benefit plan.
On April 17, 1995, ASE's Manager of Human Resources, Daryl Johnson, sent Brant a letter concerning continuation of his benefits while on LTD. The letter stated, in pertinent part, the following:
When you become approved for LTD, your contributions for LTD and Supplemental Life will cease. These benefits continue at no cost to you.
You must, however, continue to contribute to the Medical/Dental/Dependent Life Plans or coverages will terminate.
Plaintiff's Appendix in Support of Resistance to Defendants' Motions for Summary Judgment, Exhibit 9. The letter is silent regarding contributions for basic life insurance.
ASE concedes that the April 17, 1995, letter is, perhaps, "inartful," but does not constitute a misrepresentation, because it conveys that if Brant is "disabled," his contributions for LTD and Supplemental Life Insurance will cease. Principal Life concedes that the April 17, 1995, letter is inaccurate, to the extent that it suggests that approval for LTD is the prerequisite for continuation of LTD and supplemental life insurance coverage without contributions from Mr. Brant. As Principal Life points out, however, the definition of "disability" permitting continuation of coverage during disability under the terms of the life insurance portion of the benefit plan is different from the definition of "disability" for purposes of the LTD benefits portion of the plan, so that qualification for LTD benefits does not qualify a member for continuation of life insurance coverage without employee contributions.
Specifically, the definition of "disability" for LTD benefits provides that "disability" means "[a] Member's inability, solely and directly because of sickness, injury, or pregnancy ... to perform the majority of the material duties of his or her normal job." Defendant Principal Life's Appendix in Support of Summary Judgment, Exhibit 2 (Group Long Term Disability Insurance Policy), Appendix at 7 (emphasis added). However, a member of the benefit plan is considered "disabled" for purposes of "Coverage During Disability" under the Life Insurance Policy "if, because of sickness or injury, the Member is not able to work at any job that reasonably fits his or her background and training." Defendant Principal Life's Appendix, Exhibit 5 (Member Life Insurance, Accidental Death and Dismemberment Insurance, and Dependent Life Insurance Policy), Appendix at 78 (emphasis added).
Although Brant had been approved for LTD, Principal Life notified Brant by letter dated August 10, 1995, that he did not qualify for continuation of life insurance coverage under the "Coverage During Disability" provision of the Life Insurance Policy. The letter notifying Brant of that decision, in pertinent part, stated the following:
BENEFIT QUALIFICATION
• The member will be considered disabled, if because of sickness or injury, the member is not able to work at any job that reasonably fits his or her background and training.
• Medical received from Dr. Levinson dated May 4, 1995, states that he feels you are not totally disabled based on your pulmonary functions which at this time are really not too bad.
• Dr. Levinson lists your limitations are working in temperatures of greater than 55 degrees in an 8-hour day.
• He further feels you are unable to work at Armour Swift Eckrich based on this limitation.
According to our records, you have a 12th grade education, and prior jobs held in the past consist of services in the U.S. Army, and at a packing company. Based on your limitations, along with your background and training, it appears you should be able to perform some other type of work. For this reason, we are declining your claim for the continuation of life insurance.
Due to the termination of your life insurance, you are entitled to convert your life insurance in an amount of $107,000.00 to an individual policy on a premium paying basis trade. Application for such conversion must be made within 31 days from the date of this letter. For your convenience, we have enclosed a conversion application. The Statement of Employer Section does not need to be completed. If you wish to take advantage of this conversion privilege, please return the completed application and a check for the first premium within 31 days from the date of this letter.
If you have any questions, or if you feel you have additional information that was not taken into account in this decision, please do not hesitate to contact us. In order to review your claim for reconsideration for this benefit, you will need to furnish medical information which supports total and continuous disability. In addition, you may request a review of the decision reached on your claim. Such request should be made in writing within 120 days of receipt of this letter and may include any issues or comments concerning denial of the claim. Upon receipt of a request, the claim will be reviewed and you will receive a written decision promptly.
Id., Exhibit 4 (Letter of August 10, 1995),...
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...who will be in attendance at the deposition (such as co-parties and their counsel). Brant v. Principal Life & Disability Ins. Co. , 195 F. Supp. 2d 1100 (N.D. Iowa 2002) (employer noticed employee’s deposition; employee’s objection to use of his deposition testimony on grounds that he was n......
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Depositions
...who will be in attendance at the deposition (such as co-parties and their counsel). Brant v. Principal Life & Disability Ins. Co. , 195 F. Supp. 2d 1100 (N.D. Iowa 2002) (employer noticed employee’s deposition; employee’s objection to use of his deposition testimony on grounds that he was n......
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Depositions
...who will be in attendance at the deposition (such as co-parties and their counsel). Brant v. Principal Life & Disability Ins. Co. , 195 F. Supp. 2d 1100 (N.D. Iowa 2002) (employer noticed employee’s deposition; employee’s objection to use of his deposition testimony on grounds that he was n......
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Depositions
...who will be in attendance at the deposition (such as co-parties and their counsel). Brant v. Principal Life & Disability Ins. Co. , 195 F. Supp. 2d 1100 (N.D. Iowa 2002) (employer noticed employee’s deposition; employee’s objection to use of his deposition testimony on grounds that he was n......