Connor v. Sedgwick Claims Mgmt. Servs., Inc.

• Decision Date: 24 June 2011
• Docket Number: Civil Action No. 09–cv–1140 (NLH).
• Citation: 796 F.Supp.2d 568
• Parties: Gail A. CONNOR, Plaintiff, v. SEDGWICK CLAIMS MANAGEMENT SERVICES, INC., et al., Defendants.
• Court: U.S. District Court — District of New Jersey

796 F.Supp.2d 568

Gail A. CONNOR, Plaintiff,

v.SEDGWICK CLAIMS MANAGEMENT SERVICES, INC., et al., Defendants.

Civil Action No. 09–cv–1140 (NLH).

United States District Court, D. New Jersey.

June 24, 2011.

Stephen R. Bosin, River Edge, NJ, for Plaintiff Gail A. Connor.

Ivan R. Novich, Edwards, Angell, Palmer & Dodge, LLP, Madison, NJ, for Defendant PNC Corp. & Affiliates Long Term Disability Plan.

OPINION

HILLMAN, District Judge.

Plaintiff, Gail A. Connor, seeks reinstatement of her long term disability benefits from Defendant PNC Corp. & Affiliates Long Term Disability Plan (hereinafter “Defendant”). The long term disability plan at issue is an employee welfare benefit plan governed by the Employee Retirement Income Security Act (hereinafter “ERISA”), 29 U.S.C. § 1001 et seq. The Court is called upon to determine whether the denial of Plaintiff's long term disability benefits was arbitrary and capricious, and, therefore, unlawful pursuant to 29 U.S.C. § 1132(a)(1)(B). Plaintiff moves for summary judgment [Doc. 23] and Defendant cross-moves for summary judgment ¹ [Doc. 27]. For the reasons expressed below, the Court will grant in part and deny in part Plaintiff's Motion and deny Defendant's Cross–Motion.

I. JURISDICTION

Plaintiff brought his claims pursuant to ERISA and this Court has jurisdiction over her claims under 28 U.S.C. § 1331 and 29 U.S.C. § 1132(d)(e) & (f).

II. BACKGROUND

Plaintiff, Gail A. Connor, worked for PNC Bank Corp.² (hereinafter “PNC”) as a “Branch Manager III” from September 27, 2004 through October 10, 2006. As an employee of PNC, Plaintiff participated in the PNC Corp. & Affiliates Long Term Disability Plan (hereinafter “Plan”). This Plan, an employee welfare benefits plan, is governed by ERISA and provides long term disability (hereinafter “LTD”) benefits, of up to 70% of their base salary, to employees of PNC who are out of work for longer than ninety (90) days. Under the Plan, a claimant is entitled to receive LTD benefits when, after the expiration of ninety (90) days, he or she is “Totally Disabled” or has a “Total Disability.” Under the Plan a covered person is “Totally Disabled” and has a “Total Disability” when “because of Injury or Sickness: [t]he participant cannot perform each of the materials duties of his or her regular occupation; and [a]fter benefits have been paid for 24 months, the participant cannot perform each of the material duties of any gainful occupation for which he or she is reasonably fitted by training[,] education or experience.” Plan, Doc. 30, Exhibit 4 at AR 333.

The Plan identified PNC as the Plan Administrator, and gave it discretionary authority to interpret the terms of the Plan and administer benefits. In addition, the Plan contained a provision that permitted the Plan Administrator to “appoint or employ individuals or firms to assist in the administration of the Plan ...”. Plan, Doc. 30, Exhibit 4 at AR 344. Pursuant to this provision, PNC entered into an Administrative Services Agreement with a third party company, Sedgwick Claims Management Services, Inc. (hereinafter “Sedgwick”). In the agreement, PNC expressly delegated to Sedgwick its discretionary authority to determine a claimant's eligibility for LTD benefits. ³

On or about January 17, 2007, more than ninety (90) days after her last day of active employment, Plaintiff filed her application for LTD benefits with Sedgwick.⁴ On her application, Plaintiff stated that she stopped working because of Systemic Lupus Erythematosus (hereinafter “lupus”) and Raynaud's disease. She specifically complained that her disability caused “difficulty with movements such as walking, bending, sitting ... standing, lifting” and using her hands. Employee Application for Benefits, Exhibit 4 at AR 307. In support of Plaintiff's application, Stephen L. Burnstein, D.O. (hereinafter “Dr. Burnstein”), her rheumatologist, submitted a Treating Physician's Statement (hereinafter “Statement”).⁵ This Statement indicated Plaintiff's primary diagnosis as lupus and secondary diagnosis as Raynaud's Disease. Dr. Burnstein also noted that the limitations or restrictions that prevent Plaintiff from performing the essential functions of her job occur “if she is exposed to cold temperatures or cold drafts or UV light stress—physical/emotional.” Treating Physician's Statement, Doc. 30, Exhibit 4 at AR 312.

As further evidence of Plaintiff's disability, Dr. Burnstein submitted to Sedgwick a letter he sent to her primary care physician. In this letter, he concluded Plaintiff has rhupus ⁶, a condition that is a combination of rheumatoid arthritis and lupus. To support this diagnosis, Dr. Burnstein provided both objective and subjective evidence of Plaintiff's disability. He specifically noted that laboratory studies completed several months ago revealed that Plaintiff's double-stranded DNA was “mildly” elevated and her ANA was “positive.” ⁷ Doc. 30, Exhibit 4 at AR 314. In his description of her current condition he reported “[t]here is no weakness or atrophy. There are no abnormal NP findings. There are no FMS tender points.” ⁸ Doc. 30, Exhibit 4 at AR 315. Although Dr. Burnstein's physical examination did not reveal that Plaintiff had any tenderness, swelling, deformity or limitation of motion, his January 12, 2007 medical records noted Plaintiff's subjective complaints of joint pain, swelling, fatigue and weakness. Finally, Dr. Burnstein indicated that in an eight-hour day Plaintiff could sit for three hours, stand for two hours, walk for one hour and view a computer screen for two hours.⁹

On March 15, 2007, Sedgwick informed Plaintiff that her “[m]edical information indicates” she is “unable to continue” her employment and that her benefits were approved on the “basis” of her “medical restrictions and limitations associated, but not limited to, the current diagnosis of Lupus.” ¹⁰ Doc. 30, Exhibit 3 at AR 277. The letter also conditioned Plaintiff's further receipt of benefits on her continued ability to meet the Plan's definition of “Total Disability.” It informed her that “[o]n a periodic basis” Sedgwick “will need to verify your ongoing eligibility for benefits” by “requesting information from you and your attending physicians.” Id. at 278.

Several months later, on November 21, 2007, Sedgwick informed Plaintiff that “based upon a lack of current treatment information on file supportive of continuing total disability” her “claim for Long Term Disability benefits was formally suspended.” ¹¹ Doc. 30, Exhibit 3 at AR 243. This suspension was in effect until Plaintiff or Dr. Burnstein submitted proof that she was “Totally Disabled.” On November 27, 2007, Dr. Burnstein replied to Sedgwick's letter and identified Plaintiff's prognosis for full or part-time employment as “poor.” ¹² Doc. 30, Exhibit 1 at AR 059. In support this determination, he provided medical records from March 5, 2007, June 5, 2007, August 23, 2007, October 9, 2007 and November 2, 2007.

Dr. Burnstein's March 5, 2007 records indicated Plaintiff complained of morning stiffness, headaches, fatigue and some nausea. Her physical examination revealed some warmth, swelling and tenderness in the joints of her hands and feet. Dr. Burnstein's records, however, did not note any limitations on Plaintiff's ability to stand, sit or walk, nor did he mention any other limitations of Plaintiff.

The medical records from June 5, 2007 noted Plaintiff complained of fatigue, but admitted it was better with medication. Plaintiff failed to report any dizziness, numbness or weakness, and her physical examination did not reveal any pain or swelling. Dr. Burnstein's records did not indicate any limitations on Plaintiff's ability to stand, sit or walk, nor did he mention any other limitations of Plaintiff. The physician concluded that Plaintiff's rhupus was “stable” with methotrexate and plaquenil.¹³ Doc. 30, Exhibit 1 at AR 071.

Plaintiff's August 23, 2007 medical records indicated she complained of fatigue. She, however, did not report any dizziness, headache, numbness or weakness to Dr. Burnstein, nor did his physical examination of her reveal any pain or swelling. The records also failed to note any limitations on Plaintiff's ability to stand, sit or walk.

Dr. Burnstein's October 9, 2007 medical records mentioned a rheumatoid arthritis “flare up” and that Plaintiff reported fatigue, morning stiffness, soreness in shoulders and that methotrexate was “not doing anything.” Doc. 30, Exhibit 1 at AR 063. The physical examination revealed some swelling and tenderness in the joints of Plaintiff's hands and feet. Dr. Burnstein's records, however, did not note any limitations on Plaintiff's ability to stand, sit or walk, nor did he indicate any other limitations of Plaintiff.

Dr. Burnstein's November 2, 2007 medical records do not contain any noteworthy observations. On December 10, 2007, Sedgwick, after receipt of Dr. Burnstein's medical records, informed Plaintiff that it would reinstate her LTD benefits.

On February 6, 2008, Plaintiff forwarded Sedgwick medical records from her December 19, 2007 visit with Dr. Burnstein. These records indicated Plaintiff reported headaches and morning stiffness lasting approximately two hours. Dr. Burnstein's physical examination revealed some swelling in the joints of Plaintiff's hands and feet. Plaintiff also mentioned she experienced daily pain in the range of 6–7 on a scale of ten, but “feels better.” Doc. 30, Exhibit 1 at AR 078. Dr. Burnstein's records did not discuss any limitations on Plaintiff's ability to stand, sit or walk, nor did he indicate any other limitations of Plaintiff.

On July 9, 2008 and again on August 6, 2008, Sedgwick reminded Plaintiff that the definition of “Total Disability” and “Totally Disabled” changes after benefits have been paid for twenty-four (24) months.¹⁴ According to Sedgwick, Plaintiff's eligibility for LTD benefits “in accordance with the ‘Own Occupation’ ... definition of total disability will end” on...