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Young v. Unitedhealth Group Life Ins. Plan

United States District Court, N.D. Alabama, Southern Division

October 31, 2014

SHARON YOUNG, Plaintiff,



On September 20, 2013, the plaintiff, Sharon Young, brought this action under the Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seq. ("ERISA"), to recover benefits she alleges are due to her under the UnitedHealth Group Life Insurance Plan ("the Plan") (Count One). (Doc. 1 at 10-12). More specifically, the plaintiff seeks Accidental Death and Dismemberment ("AD&D") benefits for the death of her husband, who had both life insurance and AD&D coverage under the Plan. The plaintiff also seeks ERISA penalties, under 29 U.S.C. § 1132(c) and 29 C.F.R. 2560.503-1(h)(2)(iii), for the defendants' alleged failure to provide "all documents, records and other information relevant to claimant's claim for benefits" (Count Two). (Doc. 1 at 13).

The complaint names as defendants the Plan, United Health Group, Inc. ("UHG"), UnitedHealthcare Insurance Company ("UHIC"), and United Healthcare Services, Inc. ("UHS"). Each of the latter three defendants is described as "a fiduciary' of [t]he Plan" (doc. 1 at 3, 4), but their individual roles are not further or clearly defined therein. They are referred to in the complaint collectively as "United Healthcare."

The case comes before the court on the defendants' motion for summary judgment. (Doc. 15). Contained within the plaintiff's response to the motion is a "request" that this court reconsider an earlier order denying discovery. (Doc. 27 at 16-21). For the reasons stated herein, the request will be DENIED, the motion for summary judgment will be GRANTED, and this case will be DISMISSED with prejudice.


A. Summary Judgment

Under Federal Rule of Civil Procedure 56, summary judgment is proper if there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) ("[S]ummary judgment is proper if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.") (internal quotation marks and citation omitted). The party requesting summary judgment always bears the initial responsibility of informing the court of the basis for its motion and identifying those portions of the pleadings or filings that it believes demonstrate the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. Once the moving party has met its burden, Rule 56(e) requires the non-moving party to go beyond the pleadings in answering the movant. Id. at 324. By its own affidavits - or by the depositions, answers to interrogatories, and admissions on file - it must designate specific facts showing that there is a genuine issue for trial. Id.

The underlying substantive law identifies which facts are material and which are irrelevant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). All reasonable doubts about the facts and all justifiable inferences are resolved in favor of the non-movant. Chapman, 229 F.3d at 1023. Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Anderson, 477 U.S. at 248. A dispute is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. If the evidence presented by the non-movant to rebut the moving party's evidence is merely colorable, or is not significantly probative, summary judgment may still be granted. Id. at 249.

How the movant may satisfy its initial evidentiary burden depends on whether that party bears the burden of proof on the given legal issues at trial. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir. 1993). If the movant bears the burden of proof on the given issue or issues at trial, then it can only meet its burden on summary judgment by presenting affirmative evidence showing the absence of a genuine issue of material fact - that is, facts that would entitle it to a directed verdict if not controverted at trial. Id. (citation omitted). Once the moving party makes such an affirmative showing, the burden shifts to the non-moving party to produce "significant, probative evidence demonstrating the existence of a triable issue of fact." Id. (citation omitted) (emphasis added).

For issues on which the movant does not bear the burden of proof at trial, it can satisfy its initial burden on summary judgment in either of two ways. Id. at 1115-16. First, the movant may simply show that there is an absence of evidence to support the non-movant's case on the particular issue at hand. Id. at 1116. In such an instance, the non-movant must rebut by either (1) showing that the record in fact contains supporting evidence sufficient to withstand a directed verdict motion, or (2) proffering evidence sufficient to withstand a directed verdict motion at trial based on the alleged evidentiary deficiency. Id. at 1116-17. When responding, the non-movant may no longer rest on mere allegations; instead, it must set forth evidence of specific facts. Lewis v. Casey, 518 U.S. 343, 358 (1996). The second method a movant in this position may use to discharge its burden is to provide affirmative evidence demonstrating that the non-moving party will be unable to prove its case at trial. Fitzpatrick, 2 F.3d at 1116. When this occurs, the non-movant must rebut by offering evidence sufficient to withstand a directed verdict at trial on the material fact sought to be negated. Id.

B. ERISA Framework

ERISA does not contain a standard of review for actions brought under 28 U.S.C. § 1132(a)(1)(B) challenging benefit eligibility determinations. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 108-09 (1989) ("Although it is a comprehensive and reticulated statute, ' ERISA does not set out the appropriate standard of review for actions... challenging benefit eligibility determinations."). Moreover, the case law that has developed over time governing such standards has significantly evolved. A history of the evolution of these standards is useful to track its development and shed light on the current framework.

In Firestone, the Supreme Court initially established three distinct standards for courts to employ when reviewing an ERISA plan administrator's benefits decision: "(1) de novo where the plan does not grant the administrator discretion; (2) arbitrary and capricious where the plan grants the administrator discretion; and (3) heightened arbitrary and capricious where the plan grants the administrator discretion and the administrator has a conflict of interest." Capone v. Aetna Life Ins. Co., 592 F.3d 1189, 1195 (11th Cir. 2010) (citing Buckley v. Metro. Life, 115 F.3d 936, 939 (11th Cir. 1997) (discussing Firestone, 489 U.S. at 115)). In Williams v. Bellsouth Telecomms., Inc., 373 F.3d 1132, 1137 (11th Cir. 2004), overruled on other grounds by Doyle v. Liberty Life Assurance Co. of Boston, 542 F.3d 1352 (11th Cir. 2008), the Eleventh Circuit fleshed out the Firestone test into a six-step framework designed to guide courts in evaluating a plan administrator's benefits decision in ERISA actions. When the Eleventh Circuit created the Williams test, the sixth step of the sequential framework required courts reviewing a plan administrator's decision to apply a heightened arbitrary and capricious standard if the plan administrator operated under a conflict of interest. See id. The Eleventh Circuit later modified this step in response to the Supreme Court's ruling in Metropolitan Life Insurance Co. v. Glenn, 554 U.S. 105, 115-17 (2008), which concluded that a conflict of interest should be weighed merely as "one factor" in determining whether an administrator abused its discretion. See Doyle, 542 F.3d at 1359 ("As we now show, Glenn implicitly overrules and conflicts with our precedent requiring courts to review under the heightened standard a conflicted administrator's benefits decision."). The Eleventh Circuit's current iteration of the Firestone standard-of-review framework is found in Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350 (11th Cir. 2011), cert. denied, 132 S.Ct. 849:

(1) Apply the de novo standard to determine whether the claim administrator's benefits-denial decision is "wrong" (i.e., the court disagrees with the administrator's decision); if it is not, then end the inquiry and affirm the decision.
(2) If the administrator's decision in fact is " de novo wrong, " then determine whether he was vested with discretion in reviewing claims; if not, end judicial inquiry and reverse the decision.
(3) If the administrator's decision is " de novo wrong" and he was vested with discretion in reviewing claims, then determine whether "reasonable" grounds supported it (hence, review his decision under the more deferential arbitrary and capricious standard).
(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator's decision; if reasonable grounds do exist, then determine if he operated under a conflict of interest.
(5) If there is no conflict, then end the inquiry and affirm the decision.
(6) If there is a conflict, the conflict should merely be a factor for the court to take into account when determining whether an administrator's decision was arbitrary and capricious.

Id. at 1355.[1] All steps of the analysis are "potentially at issue" where a plan vests discretion to the plan administrator to make benefits determinations. See id. at 1356 n.7. Conversely, then, where a plan does not confer discretion, the court simply applies the de novo review standard established by the Supreme Court in Firestone. See 489 U.S. at 115 ("[W]e hold that a denial of benefits challenged under § 1132(a)(1)(B) is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.").


A. The Plan

As part of the Plan, UHG sponsors an Accidental Death and Dismemberment plan ("the AD&D Plan") for the benefit of its eligible employees and their dependents. The AD&D Plan is governed by ERISA.[2], [3]

UHG is the Plan Administrator and, under the Plan, has "the sole and exclusive authority and discretion to interpret the benefit plans' terms and benefits under them, and to make factual and legal decisions about them." (Doc. 17-1 at 13). According to the Plan, "[b]enefits are paid through insurance coverage that [UHG] purchases from its affiliate, [UHIC]." (Doc. 17-3 at 25). The Plan states that the "Insurance Carrier" is UHS. (Doc. 17-3 at 25).

The Plan states that UHG, as Plan Administrator, "has authority to delegate, and has delegated, certain authority and duties to other parties who are third-party administrators, fiduciaries and/or trustees." (Doc. 17-1 at 13). UHG claims that it "has delegated its authority to administer the Plan to UHIC, the third-party who insures the plan." (Doc. 16 at 3). The plaintiff disputes "that UHG[] has properly and expressly delegated its Plan authority to [UHIC]" (doc. 27 at 7), but acknowledges that UHIC has issued an insurance policy which provides the benefits at issue in this case.[4] The following language from the insurance policy issued by UHIC provides that UHIC has discretion to make benefits decisions:

Discretionary Authority: When making a benefit determination under the Policy, [UHIC has] discretionary authority to determine the Covered Person's or Dependent's eligibility, if applicable, for benefits and to interpret the terms and provisions of the Policy.

(Doc. 17-6 at 29). Still, the plaintiff disputes "that this quoted language is a legally valid grant of discretionary authority under ERISA." (Doc. 27 at 8).

Regarding eligibility for AD&D benefits, the insurance policy provides that, before benefits are payable, the Covered Person must give UHIC proof that:

a. "Injury occurred while the insurance was in force under this section;"
b. "loss occurred within 365 days after the Injury;" and
c. "loss was due to Injury independent of all ...

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