Eric P. v. Dirs. Guild of Am.
Decision Date | 19 November 2019 |
Docket Number | Case No. 19-cv-00361-WHO |
Citation | 411 F.Supp.3d 992 |
Parties | ERIC P., Plaintiff, v. DIRECTORS GUILD OF AMERICA, et al., Defendants. |
Court | U.S. District Court — Northern District of California |
Katie Joy Spielman, David M. Lilienstein, DL Law Group, San Francisco, CA, for Plaintiff.
Eric Robert McDonough, Michelle Marie Scannell, Seyfarth Shaw LLP, Los Angeles, CA, Chad R. Fuller, Troutman Sanders LLP, San Diego, CA, Jenna Uyen Nguyen, Troutman Sanders LLP, Irvine, CA, Mary Catherine Kamka, Troutman Sanders LLP, San Francisco, CA, Virginia Bell Flynn, Troutman Sanders LLP, Richmond, VA, for Defendants.
ORDER ON STANDARD OF REVIEW
Re: Dkt. No. 37
Plaintiff seeks review of the Directors Guild of America-Producer Health Plan's decision denying his claim of coverage for residential mental health treatment for his daughter. The question at issue here is what standard of review – de novo or abuse of discretion – applies to my review of the Plan's denial. Plaintiff argues de novo review is appropriate, despite the discretion provided to the Trustees of the Plan and through them to the Benefits Committee under the terms of the Plan, because: (1) because the Plan documents granted deference to so many entities involved in the claim-decision process, that grant is "anything but clear and unambiguous," as required in the Ninth Circuit; (2) the Trust documents do not provide deferential decision-making authority over claims to the Benefits Committee that made the final decision for the Trustees; and (3) the second-level appeal denial by the Plan was untimely and, therefore, is not entitled to any deference. Defendants (the Claims Administrator and the Plan) oppose and argue that under the clear provisions of the Plan documents abuse of discretion review is required. I find that the grant to the Benefits Committee is clear and unambiguous and that the delay in decision-making did not cause plaintiff substantive harm. I will utilize the abuse of discretion standard in evaluating this case.1
Plaintiff and his dependent daughter were covered under the defendant Directors Guild of America-Producer Health Plan ("Plan"). The operative provisions of the Plan are the Summary Plan Description (SPD, Dkt. No. 37-1) and the Trust Agreement (Trust, Dkt. No. 39-4). As relevant to determining the standard of review, the SPD contains the following provisions:
The Board of Trustees shall have sole, complete and absolute discretionary authority to, among other things, make any and all findings of facts, constructions, interpretations and decisions relative to the Health Plan, as well as to interpret any provisions of the Health Plan, and to determine among conflicting claimants who is entitled to benefits under the Health Plan. The Board of Trustees shall be the sole judge of the standard of proof in all such cases which means that the Board of Trustees shall have the right to determine the sufficiency of any proof you may provide to support your claim to benefits.2
Id. at 106. Finally:
Under the Plan, defendant Blue Cross of California dba Anthem Blue Cross (Anthem) is the Claims Administrator and handles claims and the initial appeal process. SPD at 88-89. The Board of Trustees of the Plan established a Benefits Committee (comprised of Trustees) to decide second-level appeals under the Plan. SPD at 89, 106.
Plaintiff filed a claim with Anthem in October 2017, seeking reimbursement for and coverage of expenses related to his daughter's stay at a residential mental health facility. Dkt. No. 40-2. Plaintiff's claim was denied initially by Anthem, concluding that the treatment was "not medically necessary." Dkt. No. 40-2. Plaintiff appealed that denial to Anthem ("first-level appeal"), and Anthem denied that appeal on January 26, 2018. Dkt. No. 40-3.
Plaintiff then filed a second-level appeal for determination by the Benefits Committee of the Plan. Plaintiff requested that the matter not be heard at the Benefits Committee June 2018 meeting, in order to allow plaintiff's counsel to provide additional information. Dkt. No. 39-6. Around October 1, 2018, plaintiff submitted over 2,000 pages of documents in support of his appeal. The Plan's appeals coordinator sent the information out to a third-party reviewer, the Medical Review Institute of America (MRI), and received a report back from MRI dated October 18, 2018. Dkt. No. 39-8. The appeals coordinator sent plaintiff's counsel a letter on November 5, 2018, which was misaddressed and re-sent on November 20, 2018, advising that MRI confirmed the denial as not medically necessary and stating that the appeal would be reviewed by the Benefits Committee at the "next" meeting in February 2019. Declaration of Daga Olsen (Dkt. No. 39-1) ¶ 3, Dkt. No. 39-2. The appeal was discussed at the February 19, 2019 Benefits Committee meeting and was denied. Dkt. No. 39-11. Plaintiff filed this case on January 22, 2019.
Under Section 502 of the Employee Retirement Income Security Act ("ERISA"), a beneficiary or plan participant may sue in federal court "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B). A claim of denial of benefits in an ERISA case "is to be reviewed under a de novo standard unless the benefit plan gives the [plan's] administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch , 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989).
When the plan grants the plan administrator discretion to determine eligibility for benefits or to construe the terms of the plan, then a court may only review the administrator's decision regarding benefits for an abuse of discretion. Id. A court "can set aside the administrator's discretionary determination only when it is arbitrary and capricious." Jordan v. Northrop Grumman Corp. Welfare Benefit Plan , 370 F.3d 869, 875 (9th Cir. 2004). In such a situation, "a motion for summary...
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