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Heaton v. Prudential Insurance Co.

March 18, 2008

SUSAN HEATON, PLAINTIFF,
v.
PRUDENTIAL INSURANCE COMPANY ET AL., DEFENDANTS.



The opinion of the court was delivered by: Hon. Napoleon A. Jones, Jr. United States District Judge

ORDER: (1) ADOPTING MAGISTRATE JUDGE STORMES'S REPORT AND RECOMMENDATION (2) GRANTING IN PART AND DENYING IN PARTH PETITIONER'S MOTION FOR PARTIAL SUMMARY JUDGMENT (3) GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

The Petitioner Susan Heaton filed a complaint against Prudential Insurance Company of America ("Prudential") and Isis Pharmaceuticals, Inc.'s ("Isis") Long Term Disability Plan ("Plan") (collectively, "Defendants") for breach of the Employee Retirement Income Security Act of 1974 (ERISA). Before the Court is Judge Nita L. Stormes's Report and Recommendation ("R&R") recommending this Court: (1) grant the Petitioner's Motion for Summary Judgment as to the standard of review; (2) deny the Petitioner's Motion for Summary Judgment regarding Petitioner's status as a member of the covered class under Defendant's long- term disability plan; and (3) grant the Defendants' Motion for Summary judgment regarding Petitioner's status as a member of the covered class. For the reasons set forth below, this Court ADOPTS the R&R in its entirety and (1) GRANTS Petitioner's motion for partial summary judgment as to the standard of review; (2) DENIES Petitioner's motion for partial summary judgment as to her status as a member of the covered class; and (3) GRANTS Defendants' motion for summary judgment as to Petitioner's status as a member of the covered class.

Factual Background

I. Petitioner's Job

Isis employed Petitioner as an Assistant Director of Human Resources. (Defendants's Reply Separate Statement of Undisputed Facts (D-SSUF) at 1.) Petitioner typically worked 10-12 hours per day, 50-60 hours per week. (Plaintiff's Separate Statement of Undisputed Material Facts (P-SSUF) at 8; Lodgment Ex. B (AR) at 329.) As part of her job Heaton was required to work on a computer and handwrite more than 8 hours per day. (AR at 329.)

II. Restrictions on Petitioner's Working Conditions

Petitioner began experiencing elbow strain while working for Isis. (D-SSUF at 13.) After submitting a claim for workers'compensation in November 1999, her treating physician placed her on certain job restrictions. (Id.) From November 29 to December 7, 1999, she was limited to lifting no more than 5 pounds and minimizing repeated forceful grasping with either hand. (Id. at 661.) From December 13, 1999 to January 26, 2000, she was limited to 8 hours per day of computer keyboard time. (Id. at 662-664.) From February 20 to March 9, 2000, she was restricted to a 40 hour work week. (Id. at 665-667.) On March 9, 2000, Dr. Pierce limited Petitioner to doing one hour per day of computer work at 5-10 minutes per hour and 5-10 minutes per hour of handwriting. (Id. at 668-673.) These limitations lasted until June 27, 2000.

III. The Layoff and Settlement Agreement

Isis laid Petitioner off around April 27, 2000. (D-SSUF at 11.) Consequently, Petitioner and Isis entered a settlement agreement that included a severance package. (Id. at 26.) Isis signed the agreement on April 27, 2000 and Petitioner signed it on May 15, 2000. (Id.) It took effect on April 25, 2000. (Id.) The settlement agreement included a severance package for Petitioner with these terms:

In consideration of this Agreement, the Company (Isis) agrees to pay full salary and benefits including medical, dental and vision benefits as severance through July 1, 2000, or until the employee finds full time employment whichever is sooner (the "termination date"); and to continue vesting stock options until the date of termination as full and final settlement. (AR at 332.)

The agreement also included an integration clause:

This Agreement constitutes the complete, final and exclusive embodiment of the entire agreement between the parties with respect to the subject matter hereof. . . . the Agreement is executed without reliance upon any promise, warranty of representation, written or oral, by the parties or any representative of the parties, other than those expressly contained herein... the Agreement supersedes all prior agreements regarding the terms or termination of Employee's employment by the Company.

IV. The Prudential Long Term Disability Plan

A. Eligibility

On January 1, 1995, Isis became the Contract Holder of Prudential's Group Policy No. GO-99428-CA employer-sponsored benefit program for long-term disability ("LTD"). (DSSUF at 2.) The Plan provided that persons were eligible for insurance if (1) they were full-time Isis employees; (2) they were in the covered class. (Id. at 3.) The plan considered employees full-time if they were regularly working as normal full-time Isis employees. (Id. at 4.) Employees in the covered class were Isis regular full-time employees. (Id. at 5.)

B. Disability Defined

The Plan defined "total disability" to exist when:

(1) due to sickness or accidental injury, both of these conditions are true:

(a) [The employee is] not able to perform, for wage or profit, the material and substantial duties of [his or her] occupation.

(b) After the initial duration of a period of total disability, [the employee is] not able to perform for wage or profit the material and substantial duties of any job for which [the employee is] reasonably fitted by [his or her] education, training or experience.

(2) [The employee is] not working at any job for wage or profit.

(3) [The employee is] under the regular care of a doctor. (AR at 025.)

Benefits are payable for total disability "only if the period of disability began while [the employee was] a ...


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