West v. Aetna Life Ins. Co., C 99-4114-MWB.
| Decision Date | 07 November 2001 |
| Docket Number | No. C 99-4114-MWB.,C 99-4114-MWB. |
| Citation | 171 F.Supp.2d 856 |
| Parties | Theresa M. WEST, Plaintiff, v. AETNA LIFE INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — Northern District of Iowa |
Michael R. Mundt of Mundt, Franck & Schumacher, Denison, IA, for Plaintiff.
Sarah J. Kuehl of Heidman, Redmond, Fredregill, Patterson, Plaza, Dykstra & Prahl, Sioux City, IA, for Defendant.
TABLE OF CONTENTS
I. INTRODUCTION ............................................................... 860
A. Findings Of Fact ........................................................ 860
1. The crash ............................................................ 860
2. Post-mortem analysis ................................................. 860
3. The benefit plan ..................................................... 861
4. Denial of West's claim ............................................... 861
B. Procedural Background ................................................... 864
II. LEGAL ANALYSIS ............................................................. 865
A. Review Of Benefits Determinations Under ERISA ........................... 865
1. Deferential review ................................................... 866
a. Review of plan interpretation ..................................... 866
b. Review of factual determinations .................................. 866
c. The deferential review applicable here ............................ 867
i. "Interpretation" or "evaluation of the facts" in the parties'
arguments .................................................... 867
ii. Blurring in the case law ...................................... 868
2. "Less deferential" review ............................................ 870
a. When "less deferential" review is appropriate ..................... 870
b. Plaintiff's grounds for "less deferential" review ................. 871
i. Conflict of interest .......................................... 871
ii. Procedural irregularity ....................................... 873
c. The appropriate degree of deference ............................... 874
B. Application Of The Five-Factor Test ..................................... 875
1. Aetna's definition of "accident" ..................................... 875
2. Consideration of the definition in light of the Finley factors ....... 877
a. Conflict with ERISA ............................................... 878
i. Arguments of the parties ...................................... 878
ii. Rules of interpretation for ERISA plans ....................... 878
iii. "Ordinary" meaning of "accident." ............................. 880
iv. Federal decisions defining "accident" for purposes of
ERISA plans .................................................. 880
v. Consistency of Aetna's definition with Wickman ................ 886
vi. Consistency with New York common law .......................... 888
b. Consistency with goals of the Plan ................................ 891
c. Internal inconsistencies .......................................... 893
i. Inconsistency with the choice-of-law provision ................ 894
ii. Inconsistency with express limitations ........................ 894
d. Inconsistent interpretation by the administrator .................. 896
e. Inconsistency with clear language of the Plan ..................... 896
3. Summary .............................................................. 897
C. Application Of The "Substantial Evidence" Test .......................... 897
1. Wickman's evaluation of the facts .................................... 897
2. Intoxicated driver cases applying Wickman ............................ 898
3. Misapplications of Wickman ........................................... 901
4. Aetna's evaluation of the facts ...................................... 902
D. Prejudgment Interest And Attorney's Fees ................................ 904
III. CONCLUSION ................................................................. 905
Was an intoxicated driver's death when the car he was driving missed a curve on a highway as he returned home from an office Christmas party an "accident" within the meaning of an accidental death insurance policy governed by ERISA? The insurer denied coverage under the policy, concluding that the driver's death was not an "accident" within the meaning of the policy, as interpreted by the insurer as plan fiduciary, because his death was not "unexpected, unusual, and unforeseen." The driver's widow contends that the insurer's conflict of interest and procedural irregularities in denial of her claim were so egregious that the insurer's determination to deny benefits is entitled to no deference whatsoever, even if the insurer had the discretion under the ERISA plan to define "accident." In the alternative, however, she contends that the insurer's determination to deny benefits on the basis of its definition of "accident," because her husband was intoxicated at the time of his fatal crash, fails even the most deferential "arbitrary and capricious" review.
The factual background to this case is essentially undisputed. Nevertheless, to place the legal analysis to follow in proper context, the court must detail its findings regarding the circumstances of the plaintiff's decedent's death and the defendant's denial of the plaintiff's claim for accidental death benefits.
Plaintiff's decedent, Delane O. West, was 59 years old when he was killed at approximately 11:00 p.m. on the night of December 13, 1997. West, a night manager for United Parcel Service (UPS), had attended a UPS Christmas party that night. He was apparently returning to his home in Denison, Iowa, when his car missed a curve on U.S. Highway 59, three miles south of Denison, struck a tree, and flipped over on the driver's side. West was not wearing a seatbelt. Dr. D.W. Crabb, M.D., the Crawford County Medical Examiner, declared West dead at the scene. See, e.g., Exhibit 2, Investigating Officer[']s Report, Joint Appendix at 38-39. Road conditions were clear and dry and neither party contends that they contributed to the cause of the crash. The parties do not dispute that West was intoxicated at the time of the crash.
At the request of Dr. Crabb, Dr. Michael T. Kafka, a State Medical Examiner, performed an autopsy on Mr. West on December 14, 1997. Exhibit 4, Report of Autopsy, Joint Appendix at 41-46. Toxicology tests showed that West's blood alcohol content ("BAC") was 203 mg/dL, or .203, more than twice the legal limit of .10 under Iowa law. See id., Final Patient Report (Pathology), at 1, Joint Appendix at 46; see also IOWA CODE § 321J.2(1)(b) (); IOWA CODE § 321J.1(1)(a) (). Dr. Kafka identified the "PROBABLE CAUSE OF DEATH" as "Multiple traumatic injuries sustained during motor vehicle accident," and "OTHER SIGNIFICANT CONDITIONS" as "Ethanol intoxication." Id. at 1, Joint Appendix at 41. Similarly, Dr. Kafka's "SUMMARY" of the results of the autopsy consisted of the following:
The death of this 59-year-old male is due to multiple severe traumatic injuries resulting from a single motor vehicle accident. Ethanol intoxication was a significant contributing factor.
On December 17, 1997, Dr. Crabb certified a Certificate of Death for West, indicating that the "immediate cause" of West's death was "(a) Massive Head Trauma due to (or as a consequence of) (b) Motor Vehicle Crash due to (or as a consequence of) (c) Acute Alcoholic Intoxication." Exhibit 3, Certificate of Death, Joint Appendix at 40 (). The Certificate of Death indicates further that the "approximate interval between onset and death" for the head trauma and motor vehicle crash was "immediate" and for the alcoholic intoxication was "2-4 hrs." Id. The Certificate of Death states further that the "Toxicology from Autopsy [indicated] Alcohol 274 vitreous, 203 blood, 199 urine." Id. Dr. Crabb certified the "Manner of Death" on the death certificate as "Accident." Id.
West's widow, plaintiff Theresa West, made a claim for death benefits under a group benefit plan provided by defendant Aetna Life Insurance Company through West's employer, UPS. See Exhibit 1, UPS Plan, Joint Appendix. The UPS Plan provides life insurance, accidental death and dismemberment coverage, and disability coverage. In pertinent part, the Accidental Death and Dismemberment Coverage portion of the UPS Plan states, "This Plan pays a benefit if, while insured, you suffer a bodily injury in an accident and if, within 90 days after the accident, you lose, as a direct result of the injury ... [y]our life." Id. at 5, Joint Appendix at 10. The beneficiary's "full Principal Sum is payable for loss of life." Id. However, this portion of the UPS Plan contains the following "Limitations":
Benefits are paid for losses caused by accidents only. No benefits are payable for a loss caused or contributed to by:
• Bodily or mental infirmity.
• Disease, ptomaines or bacterial infections.*
•...
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