Burke v. Pitney Bowes Inc. Long-Term Disability

• Decision Date: 19 September 2008
• Docket Number: No. 06-15341.,06-15341.
• Citation: 544 F.3d 1016
• Parties: Cara A. BURKE, Plaintiff-Appellant, v. PITNEY BOWES INC. LONG-TERM DISABILITY PLAN, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

544 F.3d 1016

Cara A. BURKE, Plaintiff-Appellant, v. PITNEY BOWES INC. LONG-TERM DISABILITY PLAN, Defendant-Appellee.

No. 06-15341.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted December 7, 2007.

Submission Withdrawn January 24, 2008.

Filed September 19, 2008.

Resubmitted July 17, 2008.

Constantin V. Roboostoff, Roboostoff & Kalkin, San Francisco, CA, for the plaintiff-appellant.

Nicole A. Diller, Morgan Lewis & Bockius, San Francisco, CA, for the defendant-appellee.

Appeal from the United States District Court for the Northern District of California; Marilyn H. Patel, District Judge, Presiding. D.C. No. CV 04-4483 MHP.

Before: B. FLETCHER, A. WALLACE TASHIMA, and JOHNNIE B. RAWLINSON, Circuit Judges.

TASHIMA, Circuit Judge:

Cara Burke appeals the district court's order granting summary judgment to Pitney Bowes Inc. Long-Term Disability Plan on Burke's claims arising from the Plan Employee Benefits Committee's termination of her long-term disability benefits. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we vacate and remand for further proceedings consistent with this opinion and the Supreme Court's recent decision in Metropolitan Life Insurance Co. v. Glenn, ___ U.S. ___, 128 S.Ct. 2343, 171 L.Ed.2d 299 (2008).

I. BACKGROUND

A. Facts

Burke was hired by Pitney Bowes Management Services ("Pitney") as a sales employee in December 1995 and qualified for coverage under Pitney's Long-Term Disability Plan (the "Plan"). The Plan is subject to the requirements of the Employee Retirement Income Security Act of 1974 ("ERISA"). 29 U.S.C. § 1001 et seq. The Plan's Employee Benefits Committee (the "Committee") is responsible for the Plan's general administration,¹ while Pitney's Disability and Benefits Department is delegated the day-to-day responsibilities. The Committee is the final decision-maker regarding benefits eligibility.

Benefits paid out by the Plan come from the Plan's Trust, which is funded in part by Pitney and in part by employee contributions. The Committee has the authority to determine the amounts of the employer and employee contributions to the Trust, but it is unclear from the record what portion of the Trust is funded by the employees, as opposed to by Pitney. The Trust fund is a Voluntary Employees' Beneficiary Association ("VEBA") Trust;² therefore, the money paid into the Trust cannot revert back to Pitney.

In June 1998, Burke was injured in a work-related car accident, which caused her back and neck injuries, and caused her to miss five days of work. One month later, Burke was injured again in a car accident, this time not work-related. The second accident aggravated the injuries from the earlier accident, and Burke was subsequently diagnosed with multilevel lumbar degenerative disc disease, spinal stenosis, and lumbar radidulopathy.³ Burke went on disability leave on October 26, 1998, and has not since returned to work.

Burke asserts that she requested a claim form to apply for long term disability ("LTD") benefits under the Plan in March 1999.⁴ The Plan, however, contests that Burke requested a claim form at that time, and responds that she did not actually request a LTD claim form until September 10, 2000. On September 22, 2000, the Plan responded to Burke's request by asserting that Burke was not eligible for benefits under section 5.8(j) of the Plan because her disability was excluded as a work-related injury.⁵ On May 8, 2001, the Plan provided Burke's counsel with the requested LTD claim form, stating:

[The Plan] conditions the payment of long term disability ("LTD") benefits on the employee having first completed 22-weeks of short term disability ("STD"). As further mentioned, we have no record of Ms. Burke's filing a claim with Pitney Bowes for STD benefits.... Notwithstanding that Ms. Burke failed to file an STD claim with Pitney Bowes and that the deadline for filing such claim has long since expired, we will allow Ms. Burke to file a claim for LTD benefits.

Burke submitted her LTD claim in June 2001. Burke's LTD claim was denied by the Plan, which determined that Burke's injuries were excluded from coverage as a work-related injury. Burke filed a lawsuit in the Northern District of California under ERISA on May 20, 2002, and on September 26, 2002, Burke and the Plan reached a settlement in which the Plan agreed to pay Burke LTD benefits. The settlement agreement provided that Burke would receive:

monthly long-term disability benefits pursuant to the terms, process and procedures of the Plan, as long as she continues to meet the Plan's definition of "Total Disability" and otherwise remains eligible under the Plan. This provision is in no way meant to alter or modify the terms, process or procedures set forth in the Plan for receiving benefits under the Plan. Burke's eligibility for future benefits will be solely governed by the terms, process and procedures of the Plan and ERISA. Accordingly, this Agreement does not guarantee Burke any future long-term disability benefits except as determined by the Plan administrator under the terms, process, and procedure of the Plan and ERISA.

In September 2003, the Plan's physician-consultant, Dr. Broder, requested that Dr. Barry perform an independent medical examination ("IME") of Burke to determine whether she met the Plan's definition of "Totally Disabled." Section 2.33(a) defines a Participant as being "Totally Disabled" or having a "Total Disability" as:

Participant is unable (a)(i) to perform the material duties of his or her own occupation for a maximum period of twelve (12) months after the Qualifying Period, and (ii) that thereafter the Participant is unable, because of injury or illness, to engage in any gainful occupation or profession for which he is, or could become, reasonably suited by education, experience or training; provided, however, that the amount of earnings that the Participant would receive from engaging in such occupation or profession would be less than sixty percent of the Participant's annual or annualized earnings immediately prior to the event giving rise to the Total Disability.

Dr. Barry examined Burke on October 9, 2003. His report stated:

My impression is that Ms. Burke has an objectively normal physical and neurologic examination, but she demonstrates a very high level of self-perceived impairment. At this point, it appears that her described pattern of subjective symptoms are unsupported by any abnormal objective physical or neurologic findings.... Given Ms. Burke's objectively normal evaluation, I feel she can return to light work at the current time, with no lifting, pushing or pulling over 30 pounds, and no repeated bending.

On November 3, 2003, the Plan notified Burke that it was terminating her benefits because it determined that she was not "totally disabled for any occupation as defined in Section 2.33(a) of the Plan."⁶

On January 6, 2004, Burke appealed the Plan's decision and requested that the Plan produce "all documents or other writings which were submitted, considered, or generated in the course of making the decision to terminate Ms. Burke's benefits, without regard to whether such document, record, or other information was relied upon in making the benefit determination."

On February 6, 2004, the Plan produced some of the documents requested in Burke's January 6, 2004 letter, but added that:

All "correspondence, memoranda, notes or other materials" in Ms. Burke's disability claim's file relating to the decision to terminate benefits on November 1, 2003 [have been enclosed with this correspondence. However,] I have not included documents "submitted, considered or generated" in connection with the October 2001 decision to deny disability benefits (resulting in the Settlement Agreement, dated September 26, 2002). Ms. Burke or your office submitted the majority of such documents, and I assume you retained copies. Nonetheless, copies will be sent upon request.

On March 4, 2004, the Plan wrote to Burke's counsel, first stating:

[T]here are no "additional materials or information necessary" for Ms. Burke to perfect her claim. We have all materials necessary for the Employee Benefits Committee to review Ms. Burke's appeal of the termination of [LTD] benefits. That said, the Committee would consider any additional information not previously provided in support of Ms. Burke's position that she is "Totally Disabled" as defined in the [Plan].

The Plan also wrote, again, that the Plan did not provide Burke with the documents related to the 2001 decision to deny Burke benefits because the Plan assumed Burke had retained copies, but noted that the Plan would send Burke copies if she so requested. The Plan added that it was enclosing the documents provided by Dr. Broder to Dr. Barry in connection with the latter's October 2003 IME, and that "the majority of those documents are already part of Ms. Burke's file (submitted by Ms. Burke prior to the September 26, 2002 Settlement Agreement)."

On May 5, 2004, Burke's counsel provided the Plan's counsel with copies of medical reports prepared by Dr. Zwerin and a Functional Capacity Evaluation ("FCE") prepared by Lok Chan, an occupational therapist. Dr. Zwerin determined that Burke was incapable of returning to work because of an "[i]nability to engage in employment at any level due to being bed bound for up to a week at a time, 3-4 days a week regularly secondary to sciatica and back pain" and an "[i]nability to engage in work at a desk without standing or walking or lying down every 10-15 minutes for 30-45 minutes." Dr. Zwerin also stated:

Dr. Barry's preposterous conclusions aside, Ms. Burke has objective findings on MRI and discography which are entirely compatible with her clinical presentation. Her imaging studies demonstrate findings which also conform to her complaints. Ms. Burke's pain drawing today shows none of the histrionics which Dr. Barry apparently used as the basis for his conclusions.......