Perryman v. Provident Life and Accident Ins. Co., CV-01-0927-PHX-PGR.

• Decision Date: 30 March 2010
• Docket Number: No. CV-01-0927-PHX-PGR.,CV-01-0927-PHX-PGR.
• Citation: 690 F. Supp.2d 917
• Parties: Nancy PERRYMAN, Plaintiff, v. PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — District of Arizona

690 F.Supp.2d 917

Nancy PERRYMAN, Plaintiff, v. PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, Defendant.

No. CV-01-0927-PHX-PGR.

United States District Court, D. Arizona.

February 18, 2010.

Order Denying Partial Reconsideration March 30, 2010.

Richard Walter Langerman, Law Offices of Richard Langerman, Phoenix, AZ, for Plaintiff.

Brad Kevin Keogh, Office of General Litigation Services, Phoenix, AZ, for Defendant.

OPINION and ORDER

PAUL G. ROSENBLATT, District Judge.

Plaintiff Nancy Perryman ("Perryman") brings this action to recover long-term disability benefits she alleges were wrongfully denied her by defendant Provident Life and Accident Insurance Company ("Provident"). The action is before the Court for its de novo review of Provident's denial of benefits pursuant to the Employment Retirement Security Income Act of 1974 ("ERISA"). Having considered the parties' memoranda, the evidence of record, and the oral argument of counsel as presented at the bench trial of this action, the Court finds that Perryman is entitled to recover long-term disability benefits from June 1, 1999 through the date of her 65th birthday.¹

General Background

Perryman stopped working on February 28, 1997 due to her illness; she was then years old. At that time, she was the Western Farm Bureau Insurance Company's agency manager for the metropolitan Phoenix and Northern Arizona areas, supervising some 18-21 insurance agents working out of offices. She was then licensed both as a Chartered Life Underwriter and Chartered Life Financial Consultant. She was not paid a salary, but received commissions of up to some $300,000 per year; her average monthly earnings for the two years before she stopped working were $18,966. Perryman's whole working career was with Western Farm Bureau, which she started working for in the 1970s as a filed agent. She has a high school education with one year of college. She stayed at home as a homemaker for years before entering the work force.

Perryman, alleging that she was disabled from working due to chronic fatigue syndrome ("CFS")² as of March 1, 1997, filed a claim for long-term disability benefits in April, 1997. At that time, Perryman was insured under an ERISA-governed group disability insurance policy, LTD Policy # 120057, issued by Provident to her employer. Provident determined in January, 1998 that Perryman was unable to perform her former job due to her disability and began paying her disability benefits, retroactive to June 1, 1997, pursuant to the policy's two-year "own occupation" provision. Provident terminated the payments as of May 31, 1999, due to its determination that Perryman was not disabled from working under the policy's "any occupation" provision.

Pursuant to the parties' stipulation, the Court has permitted the administrative record to be supplemented by the depositions of Gwendolen Alegre, Provident's employee who made the original claims decision denying "own occupation" benefits, and Darragh Ferranti, Provident's appeal consultant who affirmed the original decision. Pursuant to Provident's request, to which Perryman has not objected, the Court will also permit the administrative record to be supplemented with the depositions of Dr. Pendergrass, Provident's consulting psychologist, and Joseph Randza, Provident's senior disability consultant.

Relevant Insurance Policy Provisions

Perryman's claim for long-term disability benefits is governed by the insurance policy's "any occupation" provision, which became effective as to Perryman on June 1, 1999.

The policy states in relevant part:

You are Disabled from Any Occupation if due to Sickness or Injury you:

1. are unable to earn at least the Any Occupation Income Level shown in Section II-Schedule of Insurance;

2. are unable to perform each of the material duties of any occupation for which you are reasonably fitted by education, training, or experience; and

3. meet the requirements of the Any Occupation Period in this section.

* * *

The Date of Disability is the date on which your Earnings are less than the... Any Occupation Income Level.

The "Any Occupation Income Level" is defined as "80% of Indexed Earnings from any occupation you are reasonably fitted by education, training, or experience." The "Indexed Earnings" is defined as the claimant's earnings adjusted by the rate of increase in the Department of Labor's CPI-W (the Consumer Price Index for Urban Wage Earners and Clerical Workers). The "Any Occupation Period" is defined as the period from the end of the Own Occupation Period until age 65 (in Perryman's case).

The policy also provides that "Proof of Loss means written evidence satisfactory to us that you are Disabled and entitled to LTD Monthly Benefits."

Highlights of Medical/Vocational Evidence and Related Procedural Matters in the Supplemented Administrative Record

(1) Jerry M. Fioramonti, M.D.

Dr. Fioramonti, a board-certified family practitioner who stated in October, 1997 that he had treated many CFS patients over the previous five years, was Perryman's primary care physician in Arizona. He treated her from June, 1994 through early 1998, when she moved to Texas. Perryman states that Dr. Fioramonti saw her 16 times.

Perryman first went to Dr. Fioramonti in June, 1994; she then complained in part of "vague, generalized symptoms of excessive fatigue" and was at that time assessed as having a "potpurri of generalized symptoms which remind one certainly of viral infection." (Administrative Record ("AR") at 488). Dr. Fioramonti's medical notes first indicate the "purely speculative" possibility of Perryman being infected with CFS on July 13, 1994, which was when Perryman told him that she had a sister with CFS and wondered if she could also have it. (AR at 487). His assessment of her in February, 1995 was that she had the diagnosis of CFS, "waxing and waning ever since it first hit her back in June." (AR at 486). His assessment of her in May, 1995 was that she had CFS "improved with modification of lifestyle," which was that she went from working 10-12 hour days to working four-six hour days and not working on weekends. (AR at 485). In August, 1995, he noted that her CFS was "really improving in leaps and bounds." (AR at 484). In January, 1997, he assessed her as having a history of CFS with progressive memory loss. (AR at 482).

On April 29, 1997, Dr. Fioramonti's notes state that Perryman had decided that she was going to have to go on total disability and brought in a disability form to be filled that, that he "went through it line and by line with her and filled it out" and that he "fully supports her in this diagnosis." He also noted that "her symptoms are the same, which include severe and pervasive fatigue, short term memory loss, mental confusion, myalgias, arthralgias and sleep disorder." (AR at 49 and 481).

On May 15, 1997, Dr. Fioramonti, using a Provident-supplied form, filled out a Mental Health Status Report on Perryman. (AR at 52-53). He stated in that report that her specific symptoms were "frequent bouts of overwhelming fatigue & total body exhaustion; severe myalgias; short term memory loss and confusion & flu-like symptoms." He noted on the report that her condition had deteriorated, and that she was not able to perform either her own occupation or any occupation because she "cannot sustain office or supervisory activities due to severe exhaustion, poor memory & confusion." He stated that the estimated date of her return to work was "unknown & indeterminable." He commented that "this illness is not specifically treatable or responsive to rehab. Future course is unpredictable."

On May 15, 1997, Dr. Fioramonti also filled out a Provident-supplied Behavioral Capacities form (AR at 51) and a Physical Capacities form (AR at 50). In the Behavioral Capacities form he noted that Perryman "never" had the capacity (1) to perform either simple or complex, repetitive tasks over a period of time according to a set procedure or pace with minimal changes in work activity, (2) to perform frequent changes in tasks and/or skill level without loss of efficiency or composure, (3) to perform duties that are potentially dangerous to self or others and/or make decisions that will affect the well-being of others, and (4) to engage in work where continued employment and earnings are based on amount of goods produced, commission earnings, volume of work processed, and adhering to frequent deadline changes.

Dr. Fioramonti also noted that Perryman had the capacity "up to 1/3 of the work day" (1) to provide direction to others, (2) to influence others in their opinions, attitudes, judgments, (3) to engage in work that involves interpersonal relationships in job situations beyond receiving work instructions, (4) to use sound judgment and make decisions based on subjective/concrete information, and (5) to make generalizations, evaluations, and decisions based on measurable or verifiable/objective criteria.

In the Physical Capacities form, Dr. Fioramonti noted in part that Perryman could at one time stand and walk for ½ hour, sit for three hours, and drive for one hour, and that during an entire work day she could stand and walk for one hour, sit for four hours, and drive for two hours. He also noted that Perryman could occasionally lift and carry up to five pounds, and could occasionally bend, squat, kneel, and reach.

On October 21, 1997, Dr. Fioramonti filled out another form (AR at 499-500) related to Perryman's ability to do work-related physical activities on which he noted in part that Perryman could, for a total at one time, sit for four hours, stand for one hour, and walk for ½ hour, and could, for a total during an entire eight hour day, sit for four hours, and stand and walk for one hour; he also noted that Perryman occasionally could lift up to ten pounds, carry up to five pounds, and bend, squat, and reach, and that she had a mild restriction in driving automotive equipment. He further commented...