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Stewart v. Hartford Life and Accident Insurance Co.

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

January 9, 2019

CAROL H. STEWART, Plaintiff,
v.
HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY, Defendant.

          MEMORANDUM OPINION

          KARON OWEN BOWDRE CHIEF UNITED STATES DISTRICT JUDGE

         This matter comes before the court on "Plaintiffs Opposed Motion for Discovery." (Doc. 43). Plaintiff Carol Stewart brought an ERISA claim against Hartford Life and Accident Insurance Company for (1) denying her long-term disability (LTD) claim, and (2) denying her waiver-of-life-premium (WOLP) claim. (Doc. 1). Ms. Stewart's motion for discovery presents a variety of arguments, and her proposed discovery contemplates far-reaching interrogatories, requests for production, requests for admissions, and depositions. (Doc. 44). For the following reasons, the court will GRANT IN PART the motion as to the specific requests identified in this Opinion and will DENY the motion as to Plaintiffs remaining discovery requests.

         I. Standard of Review

         The motion under consideration seeks discovery beyond the scope of the administrative record. But district courts reviewing ERISA benefits decisions do not typically permit discovery outside the administrative record. See Quinn v. Qwest Comm 'ns Corp., No. CV-09-BE-2403-E, 2011 WL 13227997, at *2 (N.D. Ala. Sept. 30, 2011) ("[A]n ERISA plaintiff cannot generally supplement the Administrative Record with additional evidence after the plan administrator's decision has been made.") (citing Oliver v. Coca Cola Co., 497 F.3d 1181, 1195 (11th Cir. 2007)). The prohibition on extra-record discovery is not absolute, though, and the framework for ERISA review elucidates when courts should allow additional discovery.

         The language of ERISA does not dictate the standard of review courts should apply when reviewing the benefits decision of plan administrators. But the Supreme Court determined that, when an insurance policy vests the plan administrator with discretion to review claims, the reviewing court should apply an arbitrary and capricious standard of review to the plan administrator's decisions. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 113 (1989).

         The Eleventh Circuit has since established a six-step procedure for reviewing ERISA benefits decisions:

(1) Apply the fife 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.

Blankenship v. Metro. Life Ins., 644 F.3d 1350, 1355 (11th Cir. 2011).

         Applying this framework, if a court determines the benefits decision was de novo wrong under Step 1 but that reasonable grounds for the decision existed under Step 3, the plaintiff usually requires extra-record discovery to prove the existence and influence of the administrator's conflict of interest at Steps 4 and 6. The administrative record, after all, rarely discloses "much, if any, information about the conflict of interest." Harvey v. Std. Ins., 787 F.Supp.2d 1287, 1291 (N.D. Ala. 2011).

         The court recognizes that a structural conflict of interest presents "an unremarkable fact in today's marketplace." See Blankenship, 644 F.3d at 1356. The court also recognizes that, although not precedent or binding, the Eleventh Circuit has affirmed that conflict discovery is not necessary when the dispute can be resolved under de novo review in Step 1. Blair v. Metro. Life Ins., 569 Fed.Appx. 827, 832 (11th Cir. 2014). Nevertheless, this court must consider a conflict of interest as a factor in its analysis under the sixth and final step of reviewing ERISA benefits decisions. See Metro. Life Ins. v. Glenn, 554 U.S. 2343, 2346 (2008). And the court often requires extra-record discovery to do so.

         But the court need not always limit this extra-record discovery to just conflict discovery. For instance, reviewing courts "are limited to the record that was before [the administrator] when it made its decision" during Step 1. Glazer v. Reliance Std. Life Ins., 524 F.3d 1241, 1247 (11th Cir. 2008). But the "record before the administrator" can differ importantly from the official administrative record defendant-administrators enter into evidence. See, e.g., Johnston v. Aetna Life Ins., 282 F.Supp.3d 1303, 1307 (S.D. Fla. 2017) (concluding that the Eleventh Circuit "does not foreclose discovery of administrator's consideration of other evidence that is not in the administrative record").

         Stated differently, if the administrative record proves insufficient for the court to complete its de novo review under Step 1, a reviewing court can permit extra-record discovery to the extent that the requested discovery will better align the record before the court and the "record ...


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