Russell v. Paul Revere Life Ins. Co.

• Decision Date: 08 June 2001
• Docket Number: No. CIV A 96-474-GMS.,CIV A 96-474-GMS.
• Citation: 148 F.Supp.2d 392
• Parties: William R. RUSSELL, III, Plaintiff, v. THE PAUL REVERE LIFE INSURANCE COMPANY, Defendant.
• Court: U.S. District Court — District of Delaware

148 F.Supp.2d 392

William R. RUSSELL, III, Plaintiff, v. THE PAUL REVERE LIFE INSURANCE COMPANY, Defendant.

No. CIV A 96-474-GMS.

United States District Court, D. Delaware.

June 8, 2001.

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Phebe S. Young, The Bayard Firm, Wilmington, DE, for plaintiff.

Richard S. Cobb, Duane, Morris & Heckscher, LLP, Wilmington, DE, for defendant.

MEMORANDUM OPINION

SLEET, District Judge.

I. INTRODUCTION

Presently before the court are cross-motions for summary judgment on the issue of whether the plaintiff, William R. Russell, III ("Russell"), is entitled to longterm disability benefits under his former employer's disability benefit policies. Russell filed an action with this court pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq., seeking review of the denial of his claims for long-term disability benefits by the defendant, Paul Revere Life Insurance Company ("Paul Revere"). Russell alleges that Paul Revere arbitrarily and capriciously denied him long-term disability benefits and failed to provide him a full and fair review of his administrative claim in violation of certain procedural requirements under ERISA. Paul Revere argues that its findings were appropriate in light of the discretion it retains as the plan administrator to interpret the Individual and Group policies. Therefore, it contends that the decision to deny benefits was not arbitrary and capricious. Further, Paul Revere maintains that its decision not to release the claim file to Russell during his appeal was not a procedural violation and that, in any event, Russell suffered no harm therefrom. In the alternative, assuming a procedural violation, Paul Revere argues that Russell is not entitled to a substantive remedy.

For the reasons that follow, the court finds that Paul Revere's decision to deny benefits was not arbitrary and capricious. Further, the court finds that Paul Revere substantially complied with the requirements of ERISA § 1132(2), that no procedural violation occurred, and that neither a substantive, nor a procedural remedy is warranted. Therefore, the court denies Russell's cross-motion for summary judgment and grants Paul Revere's cross-motion for summary judgment.

II. BACKGROUND

William Russell was employed as a Vice President and Real Estate Asset Manager with Corporate Property Investors ("CPI"), from March 1990 until he stopped working, on January 23, 1995, for reasons associated with his claimed disability.¹ Russell's position with CPI entailed the management of several real estate assets and was primarily a "desk job," but one which required travel to various property sites. Russell asserts that his resignation from CPI was precipitated by chronic pain and fatigue which "rendered him unable to carry out the responsibilities and requirements of his job." (D.I.30). In February 1995, Russell filed for disability benefits with Paul Revere. Among his symptoms, Russell cited abdominal pain of an undiagnosed etiology and associated joint and muscle pain, fatigue, and nausea. (D.I. 30 at A-82). Lucinda Harris, M.D., and Frank Petito, M.D., Russell's attending physicians, confirmed Russell's description of his symptoms as noted in the supporting claim documentation. (D.I. 31 at A-8-9). As a result, Paul Revere preliminarily began providing Russell with disability benefits, subsequent to a 90-day limitation period, while it reviewed his long-term benefit claims.² On April 5, 1995, Russell submitted the bulk of his supporting documentation, including referral reports and examination results. (D.I. 31 at B-1-110). Russell supplemented his claims with additional information on April 19, 1995. (D.I. 31 at B-111-120).

On January 16, 1996, following review of Russell's claims and associated documentation, Paul Revere notified Russell of its decision to deny him long-term benefits under both the Individual and Group policies. In particular, Paul Revere indicated that its review determined that Russell did not continue to meet the definition of "total disability" as defined. (D.I. 32 at B-449-52). On April 11, 1996, Russell formally appealed Paul Revere's denial of long-term benefits and submitted additional documentation in support of his claims. Paul Revere subsequently undertook a review of Russell's claims on appeal. On June 20, 1996, Paul Revere, citing a lack of "objective medical evidence" demonstrating that Russell was precluded from performing the duties of his occupation, denied Russell's claim with respect to the Group Policy. (D.I. 32 at B-840-41). On June 28, 1996, Paul Revere, citing the same reasons, denied Russell's claim with respect to the Individual Policy. (D.I. 32 at B-842-23).³

A. Russell's Position As A Real Estate Asset Manager

In his "Statement for Disability Benefits," Russell described his duties as Vice President and a Real Estate Asset Manager with CPI. Russell was primarily responsible for managing three shopping centers. He indicated that approximately 25 hours of a given 40 hour week was dedicated to coordinating the activities of various persons involved in the leasing and management of each property and reviewing the budgets, marketing plans and property appraisals for each property. Russell noted that his duties included frequent travel to each property cite. (D.I. 26 at A-85). Next, Russell indicated that approximately ten to fifteen hours per week were allocated to planning the enhancement and expansion of these properties and coordinating the work of in-house and outside personnel associated with this effort. Id. Finally, Russell allocated approximately five to ten hours per week to the financial analysis of the properties, procuring mortgage financing and the sale or purchase of additional property interests.⁴ Id. In response to "Part B" or the "Occupational Description" of the claim form which asked about the amount of lifting associated with his position, Russell selected the category: "sedentary." Sedentary was defined as involving sitting, walking or standing, and lifting objects between zero and ten pounds.⁵ (D.I. 26 at A-86).

B. The Available Medical Documentation

At the time of Russell's initial application for long-term benefits, he referred to fifteen separate items relating to his disability claim. Six items were responsive to "Item 15" of the claim form regarding "Hospitalization." Nine items were responsive to "Item 17" of the claim form regarding "Other Physicians." (D.I. 26 at A-84.) On April 5, 1995, a supplement, in excess of 70 individual documents, was submitted to Paul Revere in support of Russell's claim. The balance of this documentation consisted of the results of numerous medical examinations and tests ordered by specialists to whom Russell had been referred, from approximately February 1992, to March 1995. These tests ran the gamut, from magnetic resonance imaging of Russell's spine, to biopsies of his liver and gallbladder. Though the examinations varied in type and scope, the result was a consistent failure to find a diagnosis for Russell's symptoms. Nonetheless, although they differed on the extent of his disability, Russell's attending physicians, Drs. Petito and Harris, found his symptoms to preclude him from performing his job. For his part, Russell indicated that the disability interfered with his job performance such that his "[c]hronic abdominal pain, combined with periodic nausea, as well as frequent muscle [and] joint pain result[ed] in fatigue, difficulty concentrating, [and an] inability to work for extended periods." (D.I. 26 at A-86).

C. Paul Revere's Surveillance of Russell

Paul Revere's review of Russell's disability claim also consisted of private surveillance of Russell's daily activities on select occasions in October and December 1995, and May and June 1996. This surveillance was conducted to determine whether and to what extent Russell's disability affected his non-work related activities. Paul Revere initially employed an organization called International Claims Specialists ("ICS"), and then Legal Investigations, Inc. ("LI"), each of whom conducted surveillance on Russell and provided detailed reports of his activities outside the home. The surveillance revealed that Russell participated in various activities, including running errands, shopping, and transporting his child to and from day care. (D.I. 26 at A-150-52, 210-14). On several occasions, Russell was observed carrying luggage or packages of various sizes, and on one occasion, Russell was observed visiting a "Computer City" computer store where he spent the balance of one day.⁶ (D.I. 26 at A-153, 156-58). However, Russell was never observed inside his house and thus, there is no independent record of the extent to which his disability impaired his activities while at home.

D. Russell's Social Security Administration Disability Claims

On May 8, 1995, Russell filed a claim with the Social Security Administration ("SSA") seeking disability benefits. In the SSA's "Disability Report," Russell described his symptoms as he did in his claim to Paul Revere. In response to a question about how the disability changed his "work circumstances," Russell stated that, "[d]ue to pain & fatigue, travel schedule was severely limited. Attendance was affected by both symptomatic `sick' days as well as doctor and hospital visits. Dates are not specific since affects [sic] have been cumulative." (D.I. 26 at A-76). Further, Russell indicated that relative to his daily job activities, he spent approximately five hours a day sitting, two hours standing and one hour walking. Russell's "bending" was only "occasional," although he described his "reaching" as "frequent," and his "heaviest weight lifted" was 20 pounds, while the "weight frequently lifted/carried" was "up to 10 lbs."

On August 1, 1995, the SSA decided to denied Russell disability benefits, finding no disability under its rules. (D.I. 32 at B-401). The...