Richards v. Hewlett-Packard Corp.

• Decision Date: 19 January 2010
• Docket Number: No. 08-2538.,08-2538.
• Parties: Edward F. RICHARDS, Plaintiff, Appellant, v. HEWLETT-PACKARD CORPORATION, formerly Compaq, formerly Digital Equipment Corp.; Internal Disability Management, GI, Long-Term Disability Plan; and The Prudential Insurance Company of America a/k/a Prudential Financial, Defendants, Appellees.
• Court: U.S. Court of Appeals — First Circuit

592 F.3d 232

Edward F. RICHARDS, Plaintiff, Appellant, v. HEWLETT-PACKARD CORPORATION, formerly Compaq, formerly Digital Equipment Corp.; Internal Disability Management, GI, Long-Term Disability Plan; and The Prudential Insurance Company of America a/k/a Prudential Financial, Defendants, Appellees.

No. 08-2538.

United States Court of Appeals, First Circuit.

Heard October 7, 2009.

Decided January 19, 2010.

Bernard A. Kansky, with whom Kansky & Associates was on brief, for appellant.

Edward P. O'Leary, with whom Fitzhugh & Mariani LLP was on brief, for appellees.

Before LIPEZ, STAHL and HOWARD, Circuit Judges.

HOWARD, Circuit Judge.

In this ERISA¹ matter, Edward Richards appeals from an adverse summary judgment ruling which upheld the termination of his long-term disability benefits by Prudential Insurance Co. of America ("Prudential").² We affirm.

I. BACKGROUND

A. The Policy

From May 1984 until January 1991, Richards was employed by Digital Equipment Corporation ("DEC") as a software engineer.³ As a benefit of his employment with DEC, Richards was offered insurance coverage under the DEC Long-Term Disability Plan ("the Plan"). Pursuant to the Plan, Prudential managed and administered disability claims filed by DEC employees. The Plan is governed by ERISA.

To be eligible for long-term disability benefits under the Plan, a claimant must have suffered a sickness or accidental injury rendering him unable "to perform, for wage or profit, the material and substantial duties of his occupation." After twenty-four months, eligibility hinges on whether the claimant is "able to perform for wage or profit the material and substantial duties of any job" for which the claimant is reasonably fit by education, training or experience (emphasis added).

B. Richards' claim, termination and internal appeals

Richards applied for long-term benefits in May 1991, at the age of thirty-nine. He cited chronic fatigue immune dysfunction and fibromyalgia as the causes of his disability, which left him unable to work after January 15, 1991. Prudential accepted Richards' claim in October 1991 and commenced paying benefits retroactive to July 1991. In 1992 Richards was awarded Social Security disability benefits.

Since the Plan required proof of ongoing disability as a condition to continued receipt of benefits, Prudential regularly required Richards to provide a statement of his current condition and releases enabling Prudential to obtain his medical records. Although Richards occasionally balked—at least once referring to the requests as "harassment"—he uniformly complied with Prudential's requests, and his benefits continued apace.

In January 2001, Prudential, using releases provided by Richards a month earlier, requested medical records from three treating physicians Richards had previously identified in his periodic submissions to Prudential. The records request covered the period from January 1999 forward. On February 5, 2001, one of the physicians, Dr. Carol Englender, reported that she had not seen Richards in her office since prior to January 1999. A few weeks later, in response to Dr. Englender's information, and consistent with plans to review Richards' claim developed in March 2000, Prudential sought an independent review of Richards' claim from Dr. Gwen Brachman, whose practice included internal medicine, rheumatology and occupational medicine. After reviewing Richards' medical history, Dr. Brachman submitted a report to Prudential, concluding that although Richards qualified for a diagnosis of fibromyalgia, he was not physically impaired from performing the essential functions of a sedentary job. Relying on Dr. Brachman's report, Prudential informed Richards on March 26, 2001 that he was no longer eligible for long-term disability benefits and that payments would cease as of June 1, 2001.

The letter terminating Richards' benefits also contained information about the appeals process, as did a follow-up letter sent approximately one month later. Over the next three years, Richards contacted Prudential on numerous occasions. Many of the calls were requests for details on the appeals process. Others were direct requests to immediately reinstate his benefits while he prepared his appeal. Still other calls contained accusations by Richards of Prudential's professional malfeasance and threats to bring Prudential's alleged misconduct to the attention of entities ranging from the federal government to television exposé programs.

On July 26, 2004, Richards submitted a formal written appeal of Prudential's March 2001 decision. He set forth three arguments for reinstatement of his benefits: first, that Dr. Brachman was not only unqualified to review his disability, but that she also used improper evaluation techniques and made false statements in her review; second, that Prudential should have deferred to the opinions of Richards' treating doctors; and third, that Prudential should have given deference to the 1992 decision of the administrative law judge who awarded Richards Social Security disability benefits. Prudential denied the appeal by letter dated September 28, 2004.

Responding to Richards' specific complaints, Prudential noted that Dr. Brachman specialized in occupational medicine and rheumatology, and was thus qualified to review Richards' medical records, his diagnoses of fibromyalgia and chronic fatigue, and to offer an opinion on his ability to work. Prudential further noted that it did take the Social Security determination into consideration, but that Prudential's determinations are independent from the agency's. Prudential also indicated that it had reviewed Richards' records before making its original determination in 2001, and since three years had passed, it also considered additional records that Richards had provided since the decision. Finally, Prudential buttressed its decision by pointing to a transferable skills analysis that concluded that Richards could perform a number of sedentary occupations which fit within his education, training or experience.

In response to the September 28, 2004 letter, Richards submitted a letter and additional records from one of his treating physicians, Dr. Mark Hryniewich, and requested that Prudential again review its decision. On February 8, 2005, following review of the additional materials, Prudential again informed Richards that its original decision was correct.

The February 2005 letter also instructed Richards about his rights to pursue further appeals. Richards availed himself of this opportunity by submitting his second written appeal in August 2005. This appeal set forth three chief claims. First, Richards accused Prudential of ignoring Dr. Hryniewich's opinion that Richards' fibromyalgia had left him chronically disabled. Richards also protested the fact that Prudential did not contact Dr. Hryniewich personally. Finally, Richards claimed that Prudential's benefit termination notification was legally deficient because it lacked detailed instructions on how to appeal and explicit instructions about the particular information Richards would need to supply to get his benefits reinstated.

In response, Prudential conducted another review, and again affirmed the decision to terminate Richards' benefits. Relying on a medical record review performed by its Medical Director, Dr. Richard Day, Prudential reiterated its finding that Richards could perform the duties of a sedentary job for which he was qualified. The denial letter also noted that previous neurological assessments Richards had undergone were "completely normal, as were laboratory findings, and there were no rheumatological laboratory or physical findings consistent with synovitis or an inflammatory process."⁴ Additionally, Prudential informed Richards of Dr. Day's opinion that any treatment he was receiving for chronic fatigue syndrome was incomplete, given the lack of cognitive behavioral therapy.⁵ In connection with Dr. Day's report, Prudential also referred back to the transferable skills analysis performed the previous year, which identified a number of sedentary positions suitable for Richards, given what Prudential contended was his residual functioning capacity.

Richards, this time through counsel, availed himself of Prudential's final level of appeal on January 30, 2006. In addition to repeating the claim that Richards was in fact totally disabled from performing any occupation, the appeal alleged that the previous rejection—the September 29, 2005 decision—"did not set forth with the required specificity" the reasons that Richards' benefits were discontinued. Also, Richards took issue with Dr. Day's reference to cognitive behavior therapy, likening it to "years ago, [when] epileptics were locked away in institutions for the mentally insane." Finally, Richards' attorney asked to meet with Prudential's appeals committee prior to its decision.

Although the substantive decision on Richards' last appeal was still months away, Prudential responded quickly to his attorney's missive. In a letter dated February 6, 2006, Prudential expressed its view that its various benefit termination letters adequately detailed the reasons for its decisions. Specifically, Prudential noted that its letters cited policy provisions, medical reviews and vocational assessments. Additionally, Prudential rejected Richards' demand that it contact his physicians, as it was not contractually obligated to do so and because it was unnecessary given the information already in his medical file. Further, Prudential rejected Richards' attorney's request to appear before the appeals committee, as that committee "doesn't `meet' with claimants or their representatives; rather the panel provides a third and voluntary level of appeal review."

Prudential originally set an April 1, 2006 deadline for Richards to submit materials in support of his final appeal. Due to various communication breakdowns regarding deadlines, Prudential...