Perez v. Aetna Life Ins. Co.

• Citation: 96 F.3d 813
• Decision Date: 23 September 1996
• Docket Number: No. 95-1111,95-1111
• Parties: , 20 Employee Benefits Cas. 1841, Pens. Plan Guide (CCH) P 23926B Benito T. PEREZ, Jr., Plaintiff-Appellant, v. AETNA LIFE INSURANCE COMPANY, Defendant-Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

Page 813

96 F.3d 813

65 USLW 2240, 20 Employee Benefits Cas. 1841,

Pens. Plan Guide (CCH) P 23926B

Benito T. PEREZ, Jr., Plaintiff-Appellant, v. AETNA LIFE INSURANCE COMPANY, Defendant-Appellee.

No. 95-1111.

United States Court of Appeals,

Sixth Circuit.

Argued March 14, 1996.

Decided Sept. 23, 1996.

Timothy A. O'Rourke, Hay & O'Rourke (argued and briefed), Lansing, MI, for Plaintiff-Appellant.

Jeffrey V. Stuckey, Richard D. McNulty, Dickinson, Wright, Moon, Van Dusen & Freeman (argued and briefed), Lansing, MI, for Defendant-Appellee.

Before: JONES, BOGGS, and COLE, Circuit Judges.

BOGGS, Circuit Judge.

Benito T. Perez, Jr. appeals from the district court's grant of summary judgment to the Aetna Life Insurance Company (Aetna), on his claim under the Employee Retirement Income Security Act (ERISA). We resolve a split of authority among the district courts in the Sixth Circuit by joining those circuits holding that a de novo standard of review applies to both factual determinations and plan interpretation determinations made by an ERISA plan administrator, unless the plan clearly gives a particular kind of discretion to the administrator. Applying this standard of review, we reverse the district court's grant of summary judgment to Aetna.

I

While working for the Motor Wheel Corporation, a division of Goodyear Tire and Rubber, Perez suffered a severe injury to his heel and ankle when he jumped from a platform to escape an explosion of molten steel. Before his injury, Perez had worked for Motor Wheel for 16 years. At the time of his accident, Perez had only a limited education--a General Educational Development (GED) diploma obtained while he was in the military. Even so, Perez was earning $40,000 per year in 1971 as a production foreman. His accident occurred on November 24, 1984. Pursuant to the "Group Insurance Policy/Long Term Disability Benefits" (Plan) that Goodyear Tire & Rubber had negotiated with Aetna for the benefit of Goodyear employees, Perez was determined to be completely disabled and was granted disability benefits under the Plan beginning in December 1985. Perez is now 52 years old.

Michigan law requires its residents who are receiving unemployment benefits to obtain retraining where possible. ¹ In 1987, Perez, who was a feasible candidate for retraining at the community college level, entered a program leading to an associate's degree in business management from Lansing Community College. Perez's rehabilitation counselor sent Aetna a letter in which she noted that "[f]ollowing the completion of this program [for an associate's degree], job placement assistance will be provided until Mr. Perez has obtained employment." Perez did not obtain his degree until March 1991, two years behind schedule. Nevertheless, Aetna continued Perez's benefits through the entire period. Pursuant to a recommendation from his rehabilitation counselor, Aetna informed Perez on April 8, 1991 that his benefits would be extended for a period of job placement not to extend past June 30, 1991.

Perez enrolled in a computer training course on June 24, 1991 that was scheduled to last 12 weeks. In a March 18, 1992 letter from Mid-Michigan Rehabilitation Associates, a rehabilitation counselor discussed Perez's "Amended Vocational Rehabilitation Plan" as follows ²:

Initial job placement efforts revealed that Mr. Perez needed computer skills to compete for entry-level jobs in the business field. His Business Management program at Lansing Community College did not include computer skills training, and with his prior work history comprised primarily of factory work, Mr. Perez was not suitably prepared for an entry-level business position.

Since mid-June, 1991, Mr. Perez has been involved with an individualized, hands-on computer skills training program with Smith & Bell Computer Training Institute, Inc. in Lansing, Michigan. Having no prior knowledge of the keyboard, Mr. Perez had to develop basic keyboarding skills and is now working to increase his speed. He is also involved with the Basic WordPerfect instructional program and will then progress to Advanced WordPerfect and Lotus 1-2-3.

Per Ms. Rosario's [an employee of Aetna's] request, a copy of the Amended Vocational Rehabilitation Plan was provided to her, which outlines the additional training that Mr. Perez needs. I also explained to Ms. Rosario that the training period would likely go beyond the 12-weeks [sic ] that the plan specifies because of Mr. Perez' lack of prior knowledge of the keyboard. The training program had to be further extended because of major medical problems experienced by Mr. Perez from December 1991 through March 1, 1992....

In summary, it is my professional opinion that Mr. Perez was not yet competitively employable with the completion of his Associate Degree in Business Management. Had Mr. Perez already had employment experience in the business field in addition to possessing entry-level computer skills, he would have been much more readily employable following the completion of his degree in March 1991. However, in today's highly competitive job market, Mr. Perez is at a disadvantage without additional short-term training. It is my understanding that Mr. Perez' LTD [Long-Term Disability] Benefits were discontinued because of the assumption that he was employable with the Associate Degree in Business Management. However, for the reasons described above, Mr. Perez was not yet employable. Mr. Perez is working quite diligently in his computer skills program and has exhibited much enthusiasm for it. His vocational goal is customer service representative for a utility company or other similar business.

* * * * * *

Susan M. O'Malley, M.Ed., CRC, LPC

Rehabilitation Counselor

In response to Perez's requests for extension of his long-term disability benefits, Aetna wrote Perez on February 26, 1992 discontinuing his benefits:

You ... wrote us on September 9, 1991, and more recently on February 12, 1992. You are requesting an extension of Long-Term Disability benefit coverage in order that you may secure additional training and expertise involving the use of personal computers. You feel that this will enhance your marketability in job placement. We don't dispute that this additional training would be helpful but we feel that it is not essential in determining whether or not you presently have the training to pursue some reasonable occupation that others with the same training that you have are engaged in gainful work [sic ]. We feel that you have acquired sufficient education and skills by virtue of your Associate of Arts Degree in Business Management and are now able to pursue some reasonable occupation. Therefore, we must refuse your request for extension of Long-Term Disability Benefits beyond June 30, 1991.

* * * * * *

Harvey McGee, Senior Analyst

McGee conceded at his deposition that he had no "particular vocational training," and would have to rely on Aetna's vocational expert, Leticia Rosario, in regard to such matters. Rosario stated in her deposition that she would defer to O'Malley's analysis of "whether or not Mr. Perez's capabilities in March of 1991 were competitive and marketable."

Concurrent with receiving benefits from Aetna, Perez collected Michigan worker's disability compensation benefits until December 5, 1992. On that day, he was offered employment at the Laboratory of Clinical Medicine of Michigan State University as a lab technician. He began to work there as a lab technician on December 7, 1992. He worked only one forty-hour week, then left work and never returned. Perez sought reinstatement of his worker's compensation benefits. An administrative hearing on this matter was held before a Michigan worker's compensation disability magistrate on October 6 and October 11, 1993. Perez's request for reinstatement was denied on November 16, 1993 because the magistrate believed that Perez simply did not like the lab job, probably because he was averse to working with blood samples and feared contracting AIDS as a result.

The Plan defines "[t]otal disability" and "totally disabled" as "during the twelve month qualifying period and thereafter during any one period of disability, that the employee is unable, solely because of disease, accidental bodily injury or a pregnancy-related condition to work at any reasonable occupation." "Reasonable occupation" is defined as "any gainful activity for which the employee is, or may reasonably become, fitted by education, training, or experience, and in which other people of similar background are actually employed as their principal means of support." The Plan also requires that "[s]ubsequent written proof of the continuance of such disability must be furnished to [Aetna] at such intervals as [Aetna] may reasonably require.... [Aetna] shall have the right to require as part of the proof of claim satisfactory evidence ... (2) that [the claimant] has furnished all required proofs for such benefits...." The Plan notes that,

Subject to adjustment for error, the determination and findings made in good faith by the Policyholder ³ with respect to (1) the fact and time of commencement, duration and termination of anemployee's employment, lay-off, leave of absence, or other absence from work, (2) the monthly rate of basic earnings of any employee, and (3) any fact relating to any retirement plan of a Participant Employer, shall be conclusive and binding upon all persons for the purposes of this policy.

Aetna partially based its conclusion that Perez was not disabled under the Plan on a medical evaluation by Dr. Sam Ho:

His current diagnosis will be including [sic ] a calcaneous [sic ] fracture, as well as triple arthrodesis.

He reported that he had the impairment [sic ] of his recreation activity, although does not [sic ] impair [sic ] with his independence in self-care, daily activities. Based on my evaluation, patient is not completely unable to perform any occupation which they [sic ] are...