under the Employee Retirement Income Security Act of 1974 ("ERISA").
Dionida is a registered nurse who was employed by St. Luke's Hospital in
San Francisco. St. Luke's provides its employees with the St. Luke's
Hospital Group Long Term Disability Insurance Program (the "LTD Plan"),
which is insured by Defendant Reliance Standard Life Insurance Company
Dionida submitted a claim for disability benefits arising from back and
shoulder problems. Reliance initially approved Plaintiff's claim, but
shortly thereafter reviewed her claim and denied it based on a
Transferable Skills Analysis that identified eight "suitable occupations"
for Dionida. On Dionida's appeal of the denial, Reliance affirmed its
decision to deny her claim.
For the reasons discussed below, the court reviews de novo, rather than
for abuse of discretion, Reliance's decision to deny benefits. "The court
finds that under either standard of review, Reliance's decision was
erroneous because it applied an "any occupation" standard rather than the
"regular occupation" standard required by the LTD Plan. Based on the
fully developed record, the only possible conclusion is that Dionida is
unable to perform the duties of her regular occupation, and is thus
entitled to benefits.
On July 17, 1995, Dionida submitted to Reliance a statement of claim
for long term disability benefits under an insurance policy issued to her
employer, St. Lukes Hospital. In her statement of claim, she identified
her disability as "severe low back pain radiating to right leg, and right
shoulder." The LTD Plan's description of "Total Disability" requires that
during the first 66 months*fn1 of disability the claimant be unable to
perform the material duties of his or her "regular occupation." She
described her occupation as "Staff Registered Nurse."
The administrative file for Dionida's claim contains several supporting
records from her doctors. Prior to Reliance's initial approval of
Dionida's claim, the primary support for her claim came from her treating
physician, Cesar Ortiz, M.D. Dr. Ortiz completed a Physician's Statement
of Disability form supplied by Reliance. In it he identified the
diagnoses as: 1) Chronic Degenerative Change in Acromioclavicular Joint
with Encroachment on Rotation Cuff; 2) Degenerative Arthritis of Lumbar
Spine with Slipped of L4 on L5; and 3) Bilateral Radiculopathy. He
indicated that Dionida was totally disabled from her regular occupation
and from any occupation.
There are also several other Disability Certificates and Doctor's
Certificates in the administrative file that Dr. Ortiz apparently filled
out for submission to St. Lukes and California's Employment Development
Department ("EDD") in connection with Dionida's disability leave and
disability claims. The file also contains copies of Dr. Ortiz's records
and a Physical Capacities form he filled out at Reliance's request. On
the Physical Capacities form, he indicates that Dionida is capable of
lifting/carrying a maximum of ten pounds, which is characterized on the
form as "sedentary work." He also indicates restrictions on bending,
squatting, climbing, reaching above the shoulder, kneeling, crawling and
using foot controls. The administrative record also contains a few
records from other doctors that do not add materially to the information
"provided by Dr. Ortiz.
In addition to the medical records, Reliance asked Dionida and St.
Lukes Hospital to submit information regarding Dionida's job. A job
description from St. Lukes states that Dionida's job requires a "full
range of body motion including handling and lifting patients . . ." and
an ability to lift and carry items weighing up to 40
pounds. A Job Analysis Description submitted by St. Lukes states that
Dionida's job requires her to carry items weighing 26 to 49 pounds ten
percent of the time, items weighing 50 to 100 pounds ten percent of the
time, and items weighing over 100 pounds ten percent of the time.
Reliance approved Dionida's claim on February 1, 1998. Six weeks after
approving Dionida's claim, Defendants decided to require Plaintiff to
submit to an independent medical examination ("IME").). The M.D. was
performed by Robert Branick, He stated in his report that:
"1) The results of the physical examination are
inconclusive in determining significant disability.
The objective studies that are available do document
disability related to impingement of the, right
shoulder as well as fairly mild degenerative changes
in the lumbar spine which will cause some restrictions
as mentioned above, that is, repetitive bending,
stooping, lifting, and carrying of weights in excess
of 25 pounds.
"5) This has been answered above. Barring appropriate
medical or surgical treatment, the patient will have
"6) The patient's limitations will interfere with the
ability to work as a registered nurse. Any other work
that could be carried out aside from that requiring
bending, lifting, and carrying would be permissible.
Sedentary work, keyboard work, work requiring
mobility, etc., would all be permissible."
Dr. Branick also completed a Physical Capacities form, on which he
indicates that Dionida was capable of lifting/carrying a maximum of 20
pounds (in his narrative report he says 25 pounds), which is characterized
on the form as "light work." He also indicates restrictions on bending,
climbing, and reaching above the shoulder.
Based on Dr. Branick's IME report and Physical Capacities form,
Reliance asked its Vocational Rehabilitation Consultant, Rabia Rosen, to
do a Transferable Skills Analysis ("TSA"). Rosen reported the results of
the TSA in a memorandum dated June 19, 1996. Rosen stated that "[b]ased
on her work history and her current capabilities and utilizing the OASYS
system,*fn2 a TSA was performed and eight suitable occupations were
identified for this claimant." Accompanying the memorandum is a computer
printout that contains: 1) a DOT occupation description for "Nurse,
General Duty"; 2) a statement of the occupational demands for "Nurse,
General Duty"; 3) a list of related codes and titles; and 4) a list of
eight "target DOT occupations."
A June 19, 1996, notation in the file states "OK to write up/not TD any
occ — RN Can do other duties."
A June 26, 1996 memorandum states "TSA completed — not T.D. own
occ as `nurse' positions were identified within clmts physical
capacities" and recommends denying the claim. A notation dated July 2,
1996 on the same memorandum says "OK to write denial letter."
By letter dated July 3, 1996, Reliance denied Dionida's claim for
disability benefits. Reliance acknowledges in the letter that Dionida's
condition limits her ability to lift or carry weight in excess of 25
pounds and that Dr. Branick found she is limited to light "work. Reliance
stated that, based on Dr. Branick's findings regarding Dionida's physical
capacities, there were positions within the "occupational field of
nursing" that Dionida could perform. Reliance specifically cited School
Nurse, Office Nurse, Director of Nurses' Registry and Stress Test
Technician. Reliance stated it was denying the claim because, based on
the foregoing, Dionida did not meet the LTD Plan's definition of
Total Disability from her regular occupation of Registered Nurse.
On July 25, 1996, Dionida requested review "of Reliance's denial of her
claim. By letter dated February 3, 1997, Reliance informed Dionida that
it had reviewed her claim and had determined that the decision to deny
her claim was correct. In explaining its decision, Reliance stated that:
"Given the job duties at St. Luke's Hospital, Ms.
Dionida is classified as a Staff Nurse. The duties and
responsibilities necessary to carry out the job duties
may differ from other jobs she may have with another
employer in her occupation as Registered Nurse.
However, we are required to evaluate the material
duties of a Registered Nurse occupation in its
entirety and determine if an individual is capable of
performing these material duties in another work
environment or for another employer. The eight
positions identified by the RSL vocational staff and
the material duties they incorporate are of a
sedentary and light nature. They are all classified by
the Department of Labor as positions within the
occupation of Registered Nurse.
By letter dated July 5, 1997, Dionida sought further review of her
claim. By letter dated August 5, 1997, Reliance declined to reconsider
its decision and informed Dionida that' she had exhausted all
administrative avenues for review of her claim:
On September 29, 1997, Dionida filed the instant action for disability
A. SUMMARY JUDGMENT STANDARD
Summary judgment is warranted "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 judgment as a
matter of law." See, Fed. R. Civ. Proc., Rule 56(c). On cross-motions for
summary judgment, the court must determine whether one of the parties is
entitled to judgment as a matter of law based on the undisputed facts.
See, Manetas v. International Petroleum Carriers, Inc., 541 F.2d 408, 413
(3rd Cir. 1976).
B. STANDARD FOR REVIEWING A PLAN ADMINISTRATOR'S DETERMINATION
Under ERISA, a plan administrator's decision to deny benefits is
reviewed de novo "unless the benefit plan gives the administrator or
fiduciary discretionary authority to determine eligibility for benefits
or to construe the terms of the plan." Firestone Tire & Rubber Co. v.
Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). "When
discretion is conferred, the exercise of that discretion is reviewed
under the arbitrary or capricious standard, or for abuse of discretion,
which comes to the same thing." Snow v. Standard Ins. Co., 87 F.3d 327,
330 (9th Cir. 1996) citing Atwood v. Newmont Gold Co., 45 F.3d 1317, 1321
at n. 1 (9th Cir. 1995).
Reliance argues that the LTD Plan confers upon it discretion to
interpret the terms of the LTD Plan. The disputed LTD Plan language
"INSURING CLAUSE: We will pay a monthly benefit if an
(1) is Totally Disabled as the result of a Sickness
or Injury covered by this Policy;
(2) is under the regular care of a physician;