McVeigh v. Unumprovident Corp.
| Decision Date | 09 August 2002 |
| Docket Number | No. 01-C-0679-C.,01-C-0679-C. |
| Citation | 300 F.Supp.2d 731 |
| Court | U.S. District Court — Western District of Wisconsin |
| Parties | Michael C. McVEIGH, Plaintiff, v. UNUMPROVIDENT CORPORATION and Provident Life & Accident Insurance Company, Defendants. |
Lawrence Bensky, for Plaintiff.
Paul E. Benson, Michael Best & Freidrich, LLP, Milwaukee, WI, for Defendants.
This is a civil action for monetary, declaratory and injunctive relief in which plaintiff Michael C. McVeigh is suing defendants UnumProvident Corporation and Provident Life & Accident Insurance Company for denying him disability benefits under the disability income policy he purchased from defendant Provident Life. Diversity jurisdiction was alleged. Initially, however, there was a question whether such jurisdiction existed. Defendant UnumProvident alleged that it was a Delaware corporation with "one" of its principal places of business in Portland, Maine, and defendant Provident Life stated only that it was "domiciled" in Tennessee. To clarify the question of citizenship, I ordered defendants to provide this court with their principal places of business and places of incorporation. On August 7, 2002, defendant UnumProvident declared that it is a Delaware corporation with its principal place of business in Chattanooga, Tennessee, and defendant Provident Life declared that it is a Tennessee corporation with its principal place of business in Chattanooga, Tennessee. Plaintiff is a citizen of Ohio. Therefore, diversity jurisdiction exists. See 28 U.S.C. § 1332.
Presently before the court is defendants' motion for summary judgment and plaintiff's motion for leave to file a surreply brief. Because defendants argued in their reply brief that plaintiff would be ineligible for residual disability benefits unless he was working and plaintiff has never had an opportunity to be heard on this condition of eligibility, I will allow plaintiff to file a surreply brief. Because I find that plaintiff filed a disability claim for both residual and total disability benefits and that defendants denied plaintiff's claim for residual disability benefits in bad faith and there exists a question whether plaintiff may be able to prove that he is totally disabled, I will deny defendants' motion for summary judgment as to plaintiff's claims for residual disability benefits, total disability benefits and bad faith. Because I find that plaintiff is residually disabled and that defendants denied plaintiff's claim for residual disability benefits in bad faith, I will grant summary judgment in favor of plaintiff as to these issues on the court's own motion. It will be up to the factfinder to decide the extent of plaintiff's disability and, if it finds that plaintiff is totally disabled, whether defendants acted in bad faith in denying his application for total disability benefits. Last, because plaintiff failed to adduce sufficient evidence to establish defendant UnumProvident's complete domination over defendant Provident Life's finances, policy and business practices, plaintiff cannot pierce the corporate veil. As a result, I will grant defendants' motion for summary judgment as to defendant UnumProvident only and it will be dismissed.
From the proposed findings of fact and the record, and for the sole purpose of deciding defendant's motions for summary judgment, I find that no genuine issue exists with respect to the following material facts.
Plaintiff is a physician and a citizen of Beavercreek, Ohio. Defendant UnumProvident is a Delaware corporation with its principal place of business in Chattanooga, Tennessee. Defendant Provident Life & Accident Insurance Company is a Tennessee corporation with its principal place of business in Chattanooga, Tennessee.
Since 1986, plaintiff has been licensed to practice medicine by the state of Wisconsin. From July 1997 until August 2001, plaintiff held the positions of chief of the radiology service at the Department of Veterans Affairs Medical Center in Dayton, Ohio, and director and associate professor of radiology sciences at Wright State University School of Medicine. He was a full-time employee at the Veterans Affairs Medical Center and taught medical students and residents at Wright State University. By agreement, plaintiff's salary was paid by both entities.
In May 1993, plaintiff entered into a contract for a disability income insurance policy with defendant Provident Life. Plaintiff contracted for benefits in the event of either total or residual disability. Total disability is defined as:
Total Disability or totally disabled means that due to Injuries or Sickness:
1. you are not able to perform the substantial and material duties of your occupation; and
2. you are receiving care by a Physician which is appropriate for the condition causing the disability. We will waive this requirement when continued care would be of no benefit to you.
Occupation is defined as:
[Y]our occupation means the occupation (or occupations, if more than one) in which you are regularly engaged at the time you become disabled. If your occupation is limited to a recognized speciality within the scope of your degree and license, we will deem your speciality to be your occupation.
Residual disability is defined as:
Residual disability or residually disabled, during the Elimination Period, means that due to Injuries or Sickness:
1. you are not able to do one or more of your substantial and material daily business duties or you are not able to do your usual daily business duties for as much time as it would normally take you to do them;
2. you have a Loss of Monthly Income in your occupation of at least 20%; and
3. you are receiving care by a Physician which is appropriate for the condition causing disability. We will waive this requirement when continued care would be of no benefit to you.
Loss of Monthly Income is defined as:
Loss of Monthly Income means the difference between Prior Monthly Income and Current Monthly Income ... The amount of the loss must be at least 20% of Prior Monthly Income to be deemed Loss of Monthly Income. If your loss is more than 75% of Prior Monthly Income, we will deem the loss to be 100%.
In the spring or early summer of 2000, plaintiff began experiencing painful headaches, which increased in severity and frequency over the next several months. From December 2000 until June 2001, plaintiff was examined by four different physicians who evaluated his condition. Plaintiff's primary care physician, Dr. Rudy J. Bohnic, an internist, prescribed plaintiff Zomig but it provided only temporary relief. Dr. Bohnic also ordered an MRI, which showed no abnormalities. Following the MRI, Dr. Bohnic referred plaintiff to a neurologist, Dr. Donald Wamsley, for further evaluation.
On November 29, 2000, plaintiff received a memorandum from Dr. Edward Sperber, chief of staff of the Veterans Affairs Medical Center, ordering plaintiff to stop performing all administrative duties and to continue performing clinical duties only. Dr. Sperber directed plaintiff to cease his administrative duties because plaintiff was concerned about violence in his workplace. On January 4, 2001, Dr. Sperber sent plaintiff another memorandum in which he ordered plaintiff to discontinue his duties related to nuclear medicine because concerns had been raised regarding plaintiff's recent interpretations of nuclear medicine cases.
Dr. Wamsley examined plaintiff in both January and February 2001. After each of these examinations, Dr. Wamsley sent a letter report to Dr. Bohnic. On January 9, 2001, Dr. Wamsley stated to Dr. Bohnic that On February 9, 2001, Wamsley referred to plaintiff's condition as "migraine headaches" and concluded that they are an occupational problem that "disable him and make him unable to work."
In February 2001, plaintiff filed a claim requesting "disability benefits" from defendants. The claim form did not require plaintiff to specify whether he was requesting total or residual benefits. Plaintiff included an attending physician's statement, Dr. Wamsley's letters to Dr. Bohnic and Dr. Edward Sperber's January 4, 2001 memorandum.
The disability claim form asked plaintiff to "[l]ist the duties of your occupation at the time of your disability" and state the "number of weekly hours spent at [each] duty." Plaintiff listed four duties with corresponding hours as follows: (1) "Interpretation and performance of radiology procedures: 34"; (2) "Interpretation and performance of nuclear procedures: 8"; (3) "Teaching of medical students, residents: Included in above"; and (4) "Administrative: 0."
The disability claim form asked plaintiff to "describe in order of priority the important duties of the specific occupation(s) you were engaged in on a full-time basis at the time disability commenced." Plaintiff listed the following duties in order: (1) "Interpretation and performance of Diagnostic Radiology Procedures"; (2) "Interpretation and performance of Nuclear Medicine Procedures"; (3) "Teaching of medical students, residents"; and (4) "Administrative." The form asked, "[w]hat important duties are you now able to perform and as of what date were you able to perform them?" Plaintiff answered, "Teaching and Administrative — have performed continuously." At the time plaintiff filed his disability claim, he was not performing any administrative duties at the Veterans Affairs Medical Center and he "may have been performing very few administrative duties at Wright State University." Plaintiff taught about two or three times in February 2001.
On April 20, 2001, defendants' customer care...
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