Wednesday, January 6, 2010
Because of the extremely favorable treatment ERISA plan administrators get under ERISA remedial law, you don't see a benefit claim denial get overturned everyday. Stanley Baum at the ERISA Lawyer Blog describes to us one of these cases:
In Majeski v. Metropolitan Life Insurance Co., No. 09-1930 (7th Cir. Dec. 29, 2009), the plaintiff, Kirsten Majeski, had been employed by Metropolitan Life Insurance Company ("MetLife"), and had participated in MetLife's Short Term Disability Plan (the "Plan"). The case centers on the decision of MetLife, as plan administrator, to reject Majeski's claim for short-term disability benefits, after determining that Majeski had failed to submit enough evidence to support her claim. The district court had likewise rejected Majeski's claim for the benefits and had granted summary judgment against her.
The Court applied a deferential review to Metlife's decision to deny Majeski's claim for benefits, since the Plan granted discretionary authority to Metlife, as plan administrator, to determine a participant's entitlement to benefits. However, the Court found it troubling that one doctor's report--the sole basis for MetLife's decision to deny the claim--concludes, erroneously, that Majeski did not submit objective evidence of functional limitations that were the source of her disability. This doctor did not acknowledge or analyze the significant evidence that Majeski did offer on that matter. The Court felt that these omissions made Metlife's claim denial arbitrary and capricious, and said that a plan administrator's claims procedure is not reasonable if the plan administrator's determination of a benefit claim ignores, without explanation, substantial evidence that the plaintiff submitted on the central issue-here, Majeski's functional limitations.
Now as anyone who litigates these ERISA denial of benefit claims can tell you, this is hardly the end of the case. This is because the case will now be turned over again to Metlife to review the plaintiff's claim for short-term disability benefits, and even though it will now take into account the evidence offered, Metlife could still decide to deny the claim. And the claim could again find itself in court.
I am of the opinion, as I have argued elsewhere, that once the plan administrator is found in violation of the ERISA standard under Firestone and Glenn, the plan administrator should not get another bite of the apple and the court should be able to award a remedy to plaintiff.
In any event, kudos to friend of the blog, Mark DeBofsky, for successfully arguing this case in front of the Seventh Circuit.