This month’s Friday Five addresses two cases involving disability claims that touch on Covid-19, a Circuit Court ruling for an insurer, a district court ruling that a 20-year-old regulatory settlement precluded an insurer from relying on the opinions of physicians it hired, and a claim for breach of fiduciary duty surviving a motion to dismiss in a life insurance case.

1. The 8th Circuit ruled for an insurer in an LTD benefits case, reversing (for the second time) a district court’s denial of summary judgment for the insurer. Plaintiff, a nurse previously employed by the Mayo Clinic, alleged disability due to Charcot-Marie-Tooth disease, a genetic, degenerative neurological disease. Plaintiff was initially approved for benefits through the “own occ” and portion of the “any occ” period. However, during continued evaluation of the claim, the insurer conducted research which revealed Facebook posts and online activity showing that Plaintiff was actively engaged in breeding and training German Shepard dogs and dog-show competitions. This evidence coupled with an IME and a vocational analysis that concluded Plaintiff could perform sedentary occupations supported the insurer’s decision to terminate benefits. The district court awarded judgment for the Plaintiff. The insurer appealed and the 8th Circuit remanded the matter to the district court finding that the court should not have applied the de novo standard simply because procedural irregularities existed, but instead should have considered the irregularities as part of a “sliding scale” analysis under the abuse of discretion standard. On remand, the district court again sided with the Plaintiff. On appeal again, the 8th Circuit sided again with the insurer finding that it was not an abuse of discretion to terminate benefits and rejecting the Plaintiff’s argument that the insurer hadn’t documented improvement in Plaintiff’s condition (the insurer never claimed her condition improved, but rather that it had amassed evidence about the nature of her functionality and based its decision on the “totality of information”). Similarly, the 8th Circuit held that it was not improper to rely upon online evidence and surveillance of Plaintiff’s dog-training activities since this was just one piece of evidence the insurer relied upon. The 8th Circuit also noted that although the insurer had technically failed to comply with statutory deadlines, this delay alone does not mean that the review process was unfair or biased. Citation to other decisions from sister courts making factually specific conclusions about the insurer were also not determinative of bias. McIntyre v. Reliance Standard Life Ins. Co., No. 21-3063, 2023 WL 4673615 (8th Cir. July 21, 2023)
2. The district court granted summary judgment for an insurer in a case filed by a former legal secretary alleging entitlement to LTD benefits. Of note, the court rejected the Plaintiff’s argument that it was improper for the insurer to rely upon the conclusions of a nurse (rather than a doctor) in denying benefits initially. The court reasoned that there is no ERISA requirement that a doctor review the claim but rather a health care professional with the “appropriate training and experience in the field of medicine involved in the medical judgment.” The court also rejected the Plaintiff’s argument that a 20-year-old regulatory settlement agreement requiring the insurer to give significant weight to the opinions of a claimant’s treating physicians meant that the insurer could not rely upon the opinions of doctors it employed. Any conflict of interest influencing the insurer’s decision was also mitigated against because the insurer offered (but plaintiff refused) an IME. Braun v. Unum Life Ins. Co. of Am., Case No. 22 C 1223, 2023 WL 4205536 (N.D. Ill. June 27, 2023).
3. The district court granted summary judgment for the Plaintiff and remanded the matter back to the insurer to make a determination of entitlement to future benefits after November 11, 2020 (the date the administrative record closed). Plaintiff is a 58-year-old insurance underwriter for Swiss Re who alleged disability stemming primarily from back pain. Plaintiff contended that he could not sit for any appreciable period of time and further argued that his failure to continue physical therapy in spring/summer 2020 was justified due to fear of contracting Covid-19. The Court agreed finding that Plaintiff’s inability to sit was sufficient grounds alone to conclude Plaintiff was disabled from performing the material duties of his own occupation explaining that “[t]he Court is hard-pressed to imagine how Graziano would be capable of performing even a sedentary occupation if he cannot sit as needed.” The court also found that Plaintiff’s lack of attendance at physical therapy was reasonable, and did not discredit the severity of his condition because of the risk of contracting Covid-19 particularly in the early days of the pandemic for a higher risk individual like Plaintiff. Graziano v. First Unum Life Ins. Co., 21-cv-2708 (PAC), 2023 WL 4530274 (S.D.N.Y. July 13, 2023).
4. Plaintiff filed suit after learning too late that her deceased husband failed to convert his group life insurance policy to an individual one. Plaintiff argued that his former employer and the life insurance company were responsible for the error in breach of their fiduciary duty. In July 2019, Plaintiff’s husband was diagnosed with a brain tumor and placed on LTD leave. The insurer sent Plaintiff a letter advising that his benefits had stopped, and he could convert his policy to an individual policy within 90 days. The husband never received the letter because he was in the hospital. Instead, the husband exchanged emails with his employer (with whom he had been employed for 46 years) and was initially given misinformation about conversion deadlines. He was also advised to contact the insurer for more information but he passed away before doing so. The employer moved to dismiss the complaint. The court granted the motion to dismiss only so far as the employer’s negligent misstatement of the conversion deadline was not intentional and thus was not an actionable claim for breach of fiduciary duty. The court denied the employer’s motion on all other grounds finding that plaintiff had plead sufficient facts to meet the “low bar” for pleading elements of the claim at the motion to dismiss stage. Burkett v. The Heritage Corp., Cause No. 1:22-CV-405-HAB, 2023 WL 4579953 (N.D. Indiana July 18, 2023).
5. Plaintiff, a board certified anesthesiologist, filed a claim for LTD benefits alleging disability due to Chronic Lymphocytic Leukemia. Benefits were awarded for a period of time but terminated as of June 14, 2020. Plaintiff then served extensive discovery - including noticing five depositions and written discovery. The insurer responded to the written requests but also filed a motion for a protective order arguing that discovery was limited to production of the administrative record in an ERISA dispute under de novo review. Plaintiff argued discovery was not so limited when “exceptional circumstances” existed as they did in a case raising a “complex medical question” as to whether the risk of exposure to Covid-19 constitutes a disability for an anesthesiologist who is immune-compromised. The court issued a lengthy opinion with a detailed discussion of the standards for obtaining discovery, particularly in an ERISA case. Ultimately, the Court denied the insurer’s motion for a blanket protective order but found Plaintiff’s requests were not proportional. The Court ordered the Plaintiff to file a motion to compel after the parties first engage in good faith efforts to resolve the dispute and that more explicitly identifies the merits of the requested discovery. Taekman v. Unum Life Ins. Co. of Am., Case No. 1:22cv605, 2023 WL 4763724 (M.D. N.C. July 26, 2023).