Hamall-Desai v. Fortis Benefits Ins. Co.

• Decision Date: 17 December 2004
• Docket Number: No. CIV.A. 103CV1529BBM.,CIV.A. 103CV1529BBM.
• Citation: 370 F.Supp.2d 1283
• Parties: Eileen HAMALL-DESAI, Plaintiff, v. FORTIS BENEFITS INSURANCE COMPANY and Alumax Group Long Term Disability Insurance Plan,<SMALL><SUP>1</SUP></SMALL> Defendants.
• Court: U.S. District Court — Northern District of Georgia

370 F.Supp.2d 1283

Eileen HAMALL-DESAI, Plaintiff, v. FORTIS BENEFITS INSURANCE COMPANY and Alumax Group Long Term Disability Insurance Plan,¹ Defendants.

No. CIV.A. 103CV1529BBM.

United States District Court, N.D. Georgia, Atlanta Division.

December 17, 2004.

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Pamela Ilene Atkins, Galler & Atkins, Atlanta, GA, for Plaintiff.

John Thomas Sparks, Alfred Lewis Evans, III, Austin & Sparks, Atlanta, GA, for Defendants.

ORDER

MARTIN, District Judge.

This action alleging wrongful denial of disability insurance benefits, failure to disclose, breach of fiduciary duty, and interference with other employment benefit plans is before the court on (a) Defendant's Motion for Summary Judgment [Doc. No. 44]; (b) Plaintiff's Motion for Summary Judgment [Doc. No. 46]; (c) Plaintiff's Motion to File Certain Documents Under Seal [Doc. No. 69]; (d) Joint Motion of Plaintiff and Dr. Robert C. Porter, MD and Network Medical Review to Treat as Confidential and Protected (1) the Deposition of Robert C. Porter, MD, Owner of Network Medical Review and (2) the Documents Produced by Dr. Porter and Network Medical Review [Doc. No. 72]; (e) Plaintiff's Motion for Leave to File a Reply Brief [Doc. No. 74]; and (f) Reese & Reese's Motion to Withdraw [Doc. No. 76].

I. Factual and Procedural Background

The facts presented here are excerpted from the parties' Statements of Material Facts attached to their Motions for Summary Judgment as well as the court's independent review of the record and are undisputed except where otherwise noted.²

A. Plaintiff's Medical History

In June 1985, Plaintiff Eileen Hamall-Desai ("Plaintiff" or "Desai"³) suffered a Type II hangman's fracture⁴ at the C2-C3 vertebrae of the neck with subsequent segmental C2-C3 instability, facet⁵ joint dysfunction, and cervical⁶ myofascial⁷ pain syndrome. She sought various treatments for her pain symptoms, including facet joint injections, epidural steroid injections, nerve blocks,⁸ massage therapy, aquatic exercise, and acupuncture. Desai also took various prescription pain medications. In the years following her injury, Desai was able to manage her pain, but, according to Desai, beginning in January 1996, her pain never ceased for more than two months, and she began suffering side effects from the pain management techniques. Beginning on March 4, 1998, she was receiving regular epidural steroid injections and a nerve block, but she asserts she did not experience lasting pain relief from these treatments. On April 1, 1998, Desai began working on projects⁹ from home because of her condition, which she asserts prevented her from working in the office.

B. Plaintiff's Occupation and the Benefits Plan

Desai was employed by Alumax as a Manager of Information Systems ("MIS") in the Corporate Information Services Department from 1992 until 1998. The MIS position is classified as sedentary by Fortis, which means an individual in the position can sit and stand at will but will spend most of the day sitting. Desai asserts that the position does not allow for sitting and standing at will. Desai's occupational objectives included managing installation of centralized/monitored Internet access; working with members of the Information Technology Committee to develop an implementation plan for improved technology strategies; managing transition and relocation of network, systems, voice and data communications; and determining hardware, software, and end user training requirements. Because Alumax was closing its Buckhead office, in which Desai was employed, her position was going to be eliminated in October 1998.

Desai was a "Class 1 covered person" under an employee welfare benefits plan known as the Alumax Group Long Term Disability Insurance Plan ("Plan"), for which Fortis Benefits Insurance Company ("Fortis") was the insurer. Fortis denies that it acted as the Plan administrator, but it admits that it exercised decision-making power in claims determinations. Claims made under the Plan are governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). See 29 U.S.C. §§ 1001, et seq.

The Plan vests discretion with Fortis to determine eligibility for disability benefits. It states:

Authority

We have the sole discretionary authority to determine eligibility for participation or benefits and to interpret the terms of the Policy. All determinations and interpretations made by us are conclusive and binding on all parties.

The Plan classifies an individual as disabled if she meets the Occupation Test, which states:

during the first 30 months of a period of disability (including the qualifying period), an injury, or sickness, or pregnancy requires that you be under the regular care and attendance of a doctor, and prevents you from performing at least one of the material duties of your regular occupation.¹⁰

Material duties are defined as "the set of tasks or skills required generally by employers from those engaged in a particular occupation...." Further, the Plan provides that "[o]ne material duty of your regular occupation is the ability to work for an employer on a full-time basis." The Plan defines "full-time" as "working at least 30 hours per week." If a participant qualifies as disabled, the Plan provides monthly benefits, calculated as a percentage of salary.¹¹

Despite her injury and reported pain, Desai had been working full-time at Alumax for years, occasionally taking medical leave when her symptoms worsened. From January to October 1998, Desai asserts she informed Alumax's human resources department of her worsening condition. In Desai's letter dated July 28, 1998, she informed Nix of her intent to apply for disability benefits. While it is not material to the court's findings in this Order, it appears that Desai was awarded medical leave and short-term disability benefits.¹² In early 1999,¹³ Desai applied for long-term disability ("LTD") benefits under the Plan. The parties dispute what date was listed as the date of disability. Desai asserts the date she first became unable to work due to her disability as April 1, 1998, while Fortis asserts Desai claimed she was no longer able to work as of July 28, 1998. It appears to the court, based on an internal memorandum from Byron Ellis ("Ellis"), an employee in the Alumax human resources department, that Ellis suggested using July 28, 1998 as the onset date for disability. Ellis made this decision because of Desai's scheduled severance date from the company, stating, "If you are ... granted ... medical leave of absence, you will not be severed as presently scheduled to occur on October 6, 1998, but will remain on medical leave." Fortis contends that when Desai made her LTD claim, she was aware that her position at Alumax had been terminated. Desai contends she was not aware that her position was being eliminated when she first considered applying for disability benefits.¹⁴

On June 6, 1999, Fortis denied Desai's LTD claim and notified Desai of its appeal policy, which states:

Within 60 days after Fortis Benefits Insurance Company receives a request for review, we will render a decision, unless special circumstances require an extension of time for assessing the evidence, in which case the time limit shall not be later than 120 days after the original written request for review was received.

Fortis provides up to two reviews of any benefits denial.

On August 4, 1999, Desai appealed the denial. In her appeal, Desai stated that "the issues surrounding [her] inability to perform [her] job are lack of mental alertness due to pain and/or medication side effects and [her] physical inability to perform tasks in a continuous manner." On October 23, 1999, Desai called Fortis about the status of her appeal. On November 1, 1999, a Fortis representative informed Desai that he had not received a copy of the appeal and requested that Desai send a copy of appeal to him via facsimile.¹⁵ Desai complied with his request. The next day, a Fortis representative notified Desai that the company had received the copy of her appeal and apologized for "the mishap." On November 23, 1999, Fortis denied Desai's initial appeal.

On January 20, 2000, Desai submitted a second appeal, which Fortis received on January 21, 2000. Fortis asserts it continued to receive additional documentation for consideration from Desai throughout the appeals process.

On May 1, 2000, Fortis requested that Desai undergo a neuropsychological¹⁶ examination. Desai objected to the examination because it was untimely and potentially unsafe because she was then pregnant. Nonetheless, Fortis asserts that Desai agreed to consider participation in the testing if Fortis would accept liability for any harm that might occur.

On June 15, 2000, the Social Security Administration determined that Desai has been disabled since April 1, 1998, and Fortis was made aware of the decision in a letter faxed on June 23, 2000. After reviewing all evidence relevant to Desai's case, Fortis rendered its final decision denying Desai's second appeal on June 29, 2000. Fortis contends its decision was based on an administrative record that included examination files from Desai's treating physicians and other medical personnel, a Functional Capacity Evaluation, a Vocational Evaluation, pharmacy records and medication descriptions, a testimonial from one of Desai's coworkers, surveillance records, and reviews by independent medical and vocational experts hired by or employed at Fortis.

Both parties acknowledge that all administrative avenues of appeal have been exhausted.¹⁷ On May 29, 2003, Desai initiated this action for (1) wrongful denial of disability benefits; (2) breach of fiduciary duty against Fortis; (3) interference with other Alumax employee benefit plans; and (4) failure to provide documents pertinent to Desai's claim. Fortis denies all allegations. Desai seeks the following relief: (1) past due benefits plus interest, future...