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Neathery v. Chevron Texaco Corp.

April 9, 2007

TERESA E. NEATHERY, PLAINTIFF,
v.
CHEVRON TEXACO CORPORATION ET AL., DEFENDANTS.



The opinion of the court was delivered by: Hon. Jeffrey T. Miller United States District Judge

ORDER DENYING PLAINTIFF'S MOTION TO SUPPLEMENT THE RECORD ON REVIEW GROUP ACCIDENT POLICY NO. OK [Docket No. 93] 826458

This is an ERISA case wherein Plaintiff seeks judicial review of Defendants' denial of employee benefits. Pending before the court is Plaintiff's Motion to Supplement the Record on Review by which Plaintiff requests that the court consider additional evidence, not before Defendants during administrative review, in deciding whether Defendants' denial of employee benefits was proper. Plaintiff contends the court must consider this additional evidence pursuant to Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955 (9th Cir. 2006) (en banc). Defendants oppose the motion and have also moved separately to strike the evidence. The court deemed the matter suitable for decision without oral argument pursuant to Local Rule 7.1.d.1. After considering the parties' papers and the authorities cited therein, the court hereby DENIES the motion for the reasons that follow.

I. BACKGROUND

The underlying events are alleged as follows. On May 19, 2004, Plaintiff's husband, an employee of Chevron-Texaco, died at work when the truck he was driving veered for some reason to the side of the road, striking the corner of an oil well pump cage. The airbag of the truck deployed and the seatbelt pressed against his lap and stomach. At some point either before or after the truck crashed, the decedent's stomach contents were forced up into his throat and then back down. He was pronounced dead at the scene.

On June 24, 2004, Plaintiff submitted to Defendants claims for accidental death insurance proceeds pursuant to the two insurance policies at issue in this case. On September 13, 2004, Defendants denied benefits on the ground that a medical crisis, not a work accident, had caused her husband's death. Comp., Ex. H at 4 (Defendants' letter stating that "Robert Neathery experienced an illness of unknown etiology that caused him to vomit and aspirate the material causing his suffocation."). The insurance policies exclude benefits caused by or resulting from sickness or physical illness.

On May 19, 2005, Plaintiff filed an appeal with Defendants. Before the appeal was decided, Plaintiff filed this lawsuit on September 30, 2005. Thereafter Defendants litigated this lawsuit and processed Plaintiff's appeal at the same time.

In connection with the administrative appeal and after Plaintiff filed suit, Defendants provided to Plaintiff on December 19, 2005 the report of Dr. James Lewis (the "Lewis Report"), who opined that the decedent's death was caused by an acute myocardial event. Defendants indicated to Plaintiff that they would rely on the Lewis Report in deciding the appeal, and asked Plaintiff to submit written comments thereto which Defendants would then incorporate into the administrative record. See Horner Decl., Ex. 1, n.1. In a December 29, 2005 response letter, Plaintiff declined to submit comments, contending that because Plaintiff had exhausted her administrative remedies, the administrative record was therefore closed and Defendants had no right to continue with the appeal. Id. at 2 ¶ 1.*fn1 In the same letter, Plaintiff "reserved her right" to comment on the Lewis Report at a later time, and have those comments incorporated into the administrative record, should the court decide to consider the Lewis Report. Id. at 2 ¶ 2.

On December 20, 2005, Plaintiff moved for partial summary judgment on the issue of whether Plaintiff had exhausted her administrative remedies, thereby entitling her to judicial review. See Docket No. 10; 29 C.F.R. § 2560.503-1(l) ("In the case of the failure of a plan to establish or follow claims procedures consistent with the requirements of this section, a claimant shall be deemed to have exhausted the administrative remedies under the plan and shall be entitled to pursue any available remedies under section 502(a) of the Act[.]").

In a January 12, 2006 letter, Defendants again invited Plaintiff to submit written comments on the Lewis Report before Defendants would issue a final decision:

Ninth Circuit case law holds that the Administrative Record closes once LINA issues it [sic] final decision on appeal, irrespective of whether your client has been deemed to have exhausted her administrative remedies. However, even if this were not the case your client is not harmed by commenting on Dr. Lewis' report, as she can always argue to the Court at a later date the reasons why she believes the report should not be given any merit . . .

Accordingly, I urge you to notify me immediately if you and/or your experts would like to comment on Dr. Lewis' report. If I do not hear from you, as to your intention in this regard within the next 10 days, LINA will proceed to close the Administrative Record and issue a final decision on your client's appeal without additional comment from her.

Bernacchi Decl. in Support of Motion to Strike, Ex. 14. at 77-78. Plaintiff declined this second invitation to comment, again "reserving her rights" to comment later. Horner Decl., Ex. 2. Defendants continued to process the appeal.

On January 27, 2006, Defendants denied Plaintiff's administrative appeal on the ground that the decedent died from an acute myocardial event*fn2 and therefore benefits were not due under the policies' terms. See Horner Decl., Ex. 4.

On February 14, 2006, the court granted Plaintiff's motion for partial summary judgment, concluding that Plaintiff had exhausted her ...


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