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Ratkovic v. Northrop Grumman Corp. Employee Welfare Benefit Plan

February 20, 2009


The opinion of the court was delivered by: Margaret M. Morrow United States District Judge


Plaintiff Joseph A. Ratkovic filed this action on December 28, 2006, against Northrop Grummon Corporation Employee Welfare Plan ("NGC"), UNUM Life Insurance Company of America ("UNUM"), and Metropolitan Life Insurance Company ("Met Life"). On May 9, 2007, the parties stipulated to dismiss UNUM because it acted only as the claims administrator for NGC. On December 12, 2007, the parties stipulated to dismiss Met Life with prejudice under Rule 41(a)(1). Ratkovic seeks relief for the denial of long-term disability coverage to which he claims he is entitled under a group long-term disability benefit plan underwritten by NGC ("the Plan"). Specifically, Ratkovic seeks declaratory relief, plan benefits, pre-judgment interest, restitution, attorneys' fees and costs, and other appropriate relief. After consideration of the parties' trial briefs, rebuttal briefs, and the administrative record, the court makes the following findings of fact and conclusions of law.


A. The Plan

1. The Plan is governed by the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA"), because it is an employee benefit plan funded by Ratkovic's employer.*fn1

2. NGC is the plan administrator and a plan fiduciary for ERISA purposes. NGC has delegated the role of Claims Administrator to UNUM.*fn2

3. The Plan is self-insured, meaning that NGC pays out any benefits awarded. Thus, UNUM acts only as the claims administrator and has no financial interest in the outcome of a given claims decision.

4. Under the Plan, Ratkovic was eligible to receive monthly long term disability ("LTD") benefits "if [he] bec[a]me Disabled as defined by the Plan while covered under the plan. . . . [and remained] under the care of a Duly Qualified Physician throughout the Elimination Period of 180 consecutive days."*fn3

5. The Plan states that "benefits will begin to accrue on the date following the day [the participant] complete[s] the Elimination Period."*fn4

6. No benefits are payable during the Elimination Period. "The Elimination Period begins on the day [the participant] become[s] Disabled and continues for 180 consecutive days" during which the claimant must be under the "continuous care of a Duly Qualified Physician."*fn5

7. Monthly benefits under the plan are equal to 60% of a claimant's pre-disability monthly income with a maximum monthly payment of $10,000 and a minimum of $50.*fn6

8. For purposes of coverage under the Plan, "disabled" means that: "due to sickness, pregnancy or accidental injury, you are receiving Appropriate Care and Treatment from a qualified physician on a continuing basis; and [1] Your disability prevents you from performing any and every duty of your regular occupation during the Elimination Period and the next 24 month period; or [2] After the first 24 months in which you have received benefits, you are unable to perform any and every duty of any gainful occupation for which you are reasonably qualified by training, education or experience."*fn7

9. Relevant here, the Plan also provides that monthly benefits will be paid until, inter alia, "[t]he date you are no longer disabled as defined by the Plan; [or] the date you fail to provide proof of disability as required by the Plan Administrator . . ."*fn8

10. Pursuant to the benefits summary provided by NGC to its employees, the Plan Administrator

"has the discretion to interpret the Plan and decide any and all matters arising from the Plan. The Plan Administrator has delegated [UNUM]*fn9 to have sole power and duty to review and determine claims filed under the Plan and the power and duty to process all claims and appeals and to provide other administrative services."*fn10

11. If disabled, Ratkovic is eligible under the Plan to receive benefits until age 65.*fn11

12. The Plan provides that any monthly benefits paid for any period of disability must be reduced by any "'Other Income Benefit' which is paid or payable for the same period of disability." These benefits include, inter alia, "[t]he amount provided under any Worker's Compensation, Employer Liability or similar law," and "[t]he amount of both Primary and Dependent's eligible benefits under the Social Security Act and Railroad Retirement Act."*fn12

13. Reductions for "other income benefits" are limited so that the monthly benefit under the Plan will not be less than $50.00 per month. The only exceptions to this are if there has been an overpayment of benefits or the claimant is receiving income from employment.*fn13

14. The Plan requires claimants to file for Social Security Disability ("SSDI") and provides that "Social Security benefits will be estimated and used to reduce your initial benefit even if you fail to apply."*fn14

15. The Plan also requires claimants to "promptly notify the Plan if any award or settlement derived from any 'other income' source is, or will become, payable or increased retroactively. If benefits are being paid to you in excess of those which should have been paid, the Plan will have the right to a refund of the overpayment from you. The amount of the refund is the difference between: [1] the amount of [LTD] benefits paid by the Plan; and [2] the amount of [LTD] benefits that should have been paid by the Plan."*fn15

B. Background, Diagnosis, and Initial Handling of Ratkovic's Claim

16. Ratkovic began working for Northrop Grumman in 1984. On his initial claim form, Ratkovic asserted that on June 5, 2002, while traveling to give a presentation for the company, he tripped and fell in an underground bunker in Taiwan. The fall injured his knee, and Ratkovic underwent surgery on September 10, 2002 to repair it. He claimed that since that time, he had had difficulty walking without pain.*fn16

17. Ratkovic stopped working on September 9, 2002, but attempted to return to work between December 9, 2002 and January 16, 2003.*fn17

18. On his claim form, Ratkovic stated that he was a "Research Scientist" at the time he became disabled.*fn18 NGC described his position as "Engineering & Sciences - Multi-Discipline," referencing the generic description provided by the Department of Labor, i.e., "This benchmark is intended to be used by companies that have generic classifications engaged in research and/or product development encompassing primarily one or more of the following engineering disciplines: electronics, electrical, mechanical, and/or chemical."*fn19

19. In January 2004, Ratkovic submitted a claim for LTD benefits.*fn20

20. Both Ratkovic and his supervisor submitted descriptions of Ratkovic's job duties that were substantially similar. Ratkovic stated that in a normal 40 hour week he performed the following tasks:

i. 24 hours: "perform advanced projects studies/work

ii. 8 hours: "attend project/planning meetings"

iii. 8 hours: "travel to vendors/customers"*fn21

Chief Scientist J.R. Huddle stated that Ratkovic was a "Sr. Engineer Multidiscipline" who in a typical 40 hour week performed the following tasks:

iv. 20 hours: Develop Concepts - "this is a creative task which requires the development of Navigation System concepts"

v. 12 hours: Write Proposals

vi. 8 hours: Presentations - "Prepare and deliver presentations to customers" Huddle noted that Ratkovic's "job tasks [could] be performed primarily at a desk," but that "presentations that must be made require traveling to ...

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