Select Circuit Court Decisions

Sixth Circuit - Initial Application Of The Wrong Disability Definition Was Properly Corrected Upon Consideration During The Administrative Appeal

Judge v. Metropolitan. Life Ins. Co., __ F.3d __ (6th Cir. 2013)

The plan participant, Thomas Judge, was covered by his employer's term life insurance policy which provided for early payment of benefits if an employee became totally and permanently disabled, which was defined by the plan as being unable to do the employee's own job, and any other job for which the employee is fit by education, training or experience. After Judge underwent heart surgery, he applied for benefits under the policy, claiming he was not able to return to any type of work. His treating providers recommended lifting and certain other restrictions, but indicated that he was recovering well with no evidence of complications. Yet, Judge's doctors advised against returning to work.

The plan administrator, MetLife, which was also the insurer of the benefits, initially denied the claim based on a nurse consultant's review of medical records, but mis-stated the applicable definition of disability. Judge requested an administrative appeal, submitting no new medical records or information. Following a second nurse consultant's review of the same medical records, noting the same inconsistencies and lack of objective evidence of disability, the denial was upheld but the correct definition of disability was referenced in the communication to Judge. The Sixth Circuit disagreed with the claimant's argument that the mention of the incorrect definition was arbitrary or capricious because the plan administrator corrected its error following the administrative appeal process. Further, the Court found that a remand to the administrator was unnecessary due to the objective medical evidence demonstrating that the claimant was not disabled under the appropriate definition.

The Court also rejected the argument that a file review conducted by a nurse consultant was insufficient to support the decision which did not involve a credibility assessment or second guessing of the claimant's treating physicians.

Judge also argued that MetLife improperly denied his claim that he could not perform any job without obtaining vocational evidence. However, the Court rejected this argument as well, relying on supporting case law authority from several Circuits, and found that the medical record evidence was sufficient to support a finding that the claimant was not totally and permanently disabled without obtaining vocational evidence in support.

Finally, Judge argued that the financial conflict of interest tainted MetLife's decision to deny benefits. Because the claimant failed to identify anything more than a "general observation that MetLife had a financial incentive to deny the claim", the Court found no need to give the conflict significant weight.

Seventh Circuit - Failure to Adequately Distinguish The Social Security Administration's Disability Finding Resulted From A Conflict of Interest

Raybourne v. CIGNA Life Ins. Co of New York, 700 F.3d 1076 (7th Cir. 2012)

In this second round appeal of a long term disability benefit termination decision, the court considered whether the defendant insurer and plan administrator's decision to deny further payment of benefits was improperly influenced by the structural conflict of interest of both funding benefits and making decisions on claims. CIGNA paid benefits under the 24 month "own occupation" period, based on evidence that pain related to degenerative joint disease prevented the claimant from working as a quality...

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