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Bellah v. American Airlines

August 24, 2009


The opinion of the court was delivered by: Frank C. Damrell, Jr. United States District Judge


This matter is before the court on defendants American Airlines, Inc.'s ("AA") and Met Life's motion for summary judgment pursuant to Federal Rule of Civil Procedure 56. Plaintiff Barbara Bellah ("plaintiff" or "Bellah") opposes defendants' motions. The court heard oral argument on the motions on August 21, 2009. For the reasons stated herein, defendants' motions are GRANTED.


Plaintiff Bellah worked as a flight attendant for Trans World Airlines, Inc. ("TWA") from 1985 until 2001. (MUF ¶ 1; AUF ¶ 1.) In 1997, during Bellah's TWA employment, International Association of Machinists ("IAM"), the TWA Flight Attendant's Union, applied, negotiated, and contracted for Long Term Disability ("LTD") benefits for its flight attendant members from a company known as American Bankers Life Assurance Company ("ABLAC").*fn2 (DF ¶ 2.) Plaintiff enrolled herself in the ABLAC LTD Plan, which was effective from October 1, 1997 through November 30, 2001. (See AUF ¶ 13.)

TWA filed for Title 11 Bankruptcy on January 10, 2001. (AUF ¶ 2.) Defendant AA purchased certain of TWA's assets in April 2001 and incorporated those assets into a company known as TWA LLC. (MUF ¶ 2; AUF ¶¶ 3, 5.) AA did not purchase or assume TWA's employee benefit plans; the Bankruptcy Court Order approving the sale specifically held that the asset transfer was free and clear of all employee related claims, known or unknown, accrued up to the date of sale. (AUF ¶ 4.)

Employees of TWA who continued working after AA acquired the TWA assets became employees of TWA LLC. (AUF ¶ 5.) Subsequently, AA created a new employee welfare benefit plan, the TWA Airlines LLC Universal Welfare Benefit Plan (the "Plan") for the employees of TWA LLC and for TWA employees who were disabled and receiving disability benefits from TWA's universal welfare benefit plan. (MUF ¶ 2; AUF ¶ 6.) The TWA LLC Plan was a "mirror image" plan to TWA's universal welfare benefit plan and was in existence from April 9, 2001 through December 31, 2001. (AUF ¶ 8.) Under the TWA LLC Plan, Short Term Disability ("STD") benefits were available for up to five years to flight attendants who met all terms and conditions. (MUF ¶ 3.) However, LTD benefits were available only to pilots, management, and flight dispatch officers; flight attendants were not eligible for LTD benefits under the TWA LLC LTD Plan. (MUF ¶ 3; AUF ¶ 12.) In December 2001, plaintiff filled out an "Attending Physician Statement" regarding her diagnosis and treatment; none of the boxes indicating (1) STD/Salary Continuance; (2) LTD; or (3) Unified Disability STD/LTD were checked. (DF ¶ 9; Ex. S to Bellah Decl. at AA-Bellah 1636.)

In November 2001, the ABLAC LTD policy that had been offered by IAM lapsed due to non-payment.*fn3 (DF ¶ 5.) Plaintiff asserts that neither TWA, TWA LLC, AA, IAM, nor MetLife informed Bellah that the ABLAC policy was lapsing. (DF ¶ 7.)

On January 1, 2002, active TWA LLC employees became AA employees for purposes of pay and benefits, and they became participants under AA-sponsored health and welfare benefit plans. (AUF ¶ 8.) Those TWA employees who were disabled and receiving benefits from the STD coverage in the TWA LLC Plan continued to receive disability benefits if they met the requirements for coverage and benefits. (AUF ¶ 8.) AA offered an LTD Plan to Flight Attendants. However, the Plan contained the following exclusions and limitations:

If this coverage becomes effective but you are not at work because of a disability, you are not covered under this plan until you return to work and deductions are taken from your pay.

You are not covered under this plan for a disability if you received medical care or treatment for the disability within the three months before the effective date of coverage.

(Ex. A to Decl. of Ana M. Martinez in Supp. of AA's Mot. for Summ. J. ("Martinez Decl."), filed June 18, 2009, at 91). In other words, LTD coverage was not available to flight attendants under AA's LTD Plan unless they (1) were at or returned to work and (2) had not been on disability or received medical treatment for a disability in the prior three months. (Decl. of Deborah L. Jameson in Supp. of AA's Mot. for Summ. J. ("Jameson Decl."), filed June 18, 2009, ¶ 12.)

Bellah worked for TWA LLC as a flight attendant from April 2001 until August 2001, when she become totally disabled. (DF ¶ 1.) Plaintiff's last actual work day was August 6, 2001 when she was employed by TWA LLC. (AUF ¶ 9.) She submitted a claim to receive STD benefits under the TWA LLC Plan. (AUF ¶ 9.) The Claims Administrator, MetDisability, determined Bellah's date of disability to be September 17, 2001, and approved the payout of benefits. (AUF ¶ 9.) Under the TWA LLC Plan, no further benefits were payable after September 16, 2006. (AUF ¶ 11.)

AA asserts that under the provisions of its LTD Plan, plaintiff never became a participant because she was not actively working on January 1, 2002.*fn4 (AUF ¶ 9.) Further, Bellah never returned to work after August 2001, earned no wages as an AA employee, and had no deductions taken from her pay. (AUF ¶ 15.) Plaintiff was included in a reduction of force that included hundred of Flight Attendants on January 1, 2003; she was never rehired. (AUF ¶ 24.)

In December 2001, American Airlines Human Resources sent a letter to plaintiff, informing her that she was currently on a Personal Medical Leave of Absence, which would convert to a Sick Leave of Absence on January 1, 2002. (Ex. AA to Decl. of Barbarh Bellah in Opp'n to Mot. for Summ. J. ("Bellah Decl."), filed Aug. 2, 2009.) The letter further informed that for the first two years of her leave, she was eligible for benefits at the same cost as an active employee; at the end of those two years, she would be offered COBRA. (Id.) While Bellah was on sick leave, she selected certain benefits during an open enrollment period. (AUF ¶ 16.) Plaintiff was eligible for enrollment for benefits including medical insurance, supplemental medical insurance, dental insurance, and voluntary personal accident insurance ("VPAI"). (AUF ¶ 16.) Plaintiff submits a copy of the benefits premium payment itemized cost from December 20, 2001. (Ex. U to Decl. of Barbara Bellah ("Bellah Decl."), filed Aug. 2, 2009.) The Confirmation Statements lists "Long Term Disability" at a Monthly Contribution cost of $20.84. (Id.) The total for all benefits confirmed was $94.30, for which plaintiff submitted a check that was received in March 2002. (Id.; Ex. V to Bellah Decl.; AUF ¶ 19.)

However, AA presents evidence that because plaintiff was not entitled to LTD benefits, her payments were never allocated for such benefits. Specifically, AA presents evidence that the check for $94.30 was not received and credited until March 7, 2002, even though Bellah's obligation to pay for benefits began on January 1, 2002. That payment was allocated between medical benefits, supplemental medical, dental, and VPAI; because no payments had been received in January or February 2002, a balance of $119.54 remained after the check was applied. (AUF ¶ 19.) Plaintiff continued to make payments on May 16, 2002, June 24, 2002, August 5, 2002, and January 9, 2003. (AUF ¶¶ 20-23.) Funds were allocated to medical, supplemental medical, dental, and VPAI; no funds were allocated to an LTD Plan, and a balance always remained due. (AUF ¶¶ 20-23.)

At times during MetLife's administration of plaintiff's STD benefits, MetLife personnel referred to plaintiff's claim as one for LTD benefits. (MUF ¶ 6.) Indeed, in at least one conversation with plaintiff's counsel, MetLife personnel referred to plaintiff's benefits as LTD benefits; the representative also stated that the maximum duration under the Plan was five years, consistent with plaintiff's STD Plan. (MUF ¶ 7.) However, on September 24, 2002, a MetLife representative informed plaintiff that she did not have an LTD Plan, and on February 10, 2003, a MetLife representative informed plaintiff's counsel the same. (MUF ¶ 9; ADMIN 248, 259.) Subsequently, though, MetLife sent a letter to Bellah on April 5, 2005, informing her that LTD benefits would "continue under the any occupation provision of the plan" and would terminate when she was able to return to work, no longer disabled, or when she turned 65. (MUF ¶ 8; ADMIN 334.)

On August 29, 2006, MetDisability notified plaintiff via written correspondence of the upcoming termination of her STD benefits. (AUF ¶ 10; MUF ¶ 10.) It specifically advised Bellah that "you will reach your maximum benefits duration date on September 16, 2006 at which time your STD benefits will cease to be payable," and that the claim file would be closed. (AUF ¶ 10; MUF ¶ 10.) By letter dated October 5, 2006, plaintiff's attorney sought confirmation that MetLife intended "to honor Bellah's LTD benefits" as previously indicated in the April 5, 2005 letter. By letter dated October 24, 2006, MetLife informed plaintiff and plaintiff's counsel that the April 5, 2005 letter included incorrect information and that plaintiff was only eligible for STD benefits through AA and MetLife. (MUF ¶ 12; ADMIN 311-13.) By letter dated November 21, 2006, plaintiff's counsel requested a second review of MetLife's determination that Bellah was not entitled to LTD benefits through MetLife; counsel enclosed copies of Bellah's paystubs from December 2000 and January 2001*fn5 that reflected deductions taken for "FA LTD." (MUF ¶ 13; ADMIN 309-10.) These deductions from plaintiff's pay were for the optional LTD coverage offered to TWA flight attendants by ABLAC. (MUF ¶ 14.) MetLife had no involvement with or connection to the LTD Plan insured by ABLAC. (MUF ¶ 15.)*fn6 Upon second review, MetLife upheld its determination that Bellah was not ...

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