The opinion of the court was delivered by: Present: The Honorable S. James Otero, United States District Judge
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COUNSEL PRESENT FOR PLAINTIFF:
COUNSEL PRESENT FOR DEFENDANT:
PROCEEDINGS (in chambers): FINDINGS OF FACT AND CONCLUSIONS OF LAW
The instant case arises under the Employee Retirement Income Security Act of 1974 ("ERISA"). On November 29, 2010, Plaintiff Dr. Ines Ibrahim ("Plaintiff") filed her Complaint against Defendant Bayer Corporation Disability Plan ("Defendant"). (See generally Compl., ECF No. 1.) On March 16, 2012, Plaintiff and Defendant filed their Opening Briefs. (See generally Pl.'s Opening Br., ECF No. 15; Def.'s Opening Br., ECF No. 13.) On April 9, 2012, Plaintiff and Defendant filed their Responding Briefs. (See generally Pl.'s Responding Br., ECF No. 17; Def.'s Answering Br., ECF No. 16.) On April 23, 2012, Plaintiff and Defendant filed their Reply Briefs. (See generally Pl.'s Reply Br., ECF No. 18; Def.'s Reply Br., ECF No. 20.)*fn1 The Court found this matter suitable for disposition without oral argument and vacated the trial date set for May 8, 2012. See Kearney v. Standard Ins. Co., 175 F.3d 1084, 1095 (9th Cir. 1999) (en banc) ("[T]he district court may try the case on the record that the administrator had before it."). The parties also submitted the bench trial for decisions on the briefs. (See Min. Order in Chambers 1, Dec. 22, 2011, ECF No. 11.) Having carefully reviewed the administrative record and the arguments of counsel, the Court makes the following findings of fact and conclusions of law pursuant to Federal Rule of Civil Procedure 52. See Fed. R. Civ. P. 52(a)(b)(c). Any finding of fact that is more appropriately deemed a conclusion of law, or vice versa, is so deemed. For the reasons discussed below, the Court enters judgment in favor of Defendant.
Bayer Corporation ("Bayer") is the designated plan administrator and fiduciary of the Bayer
Corporation Disability Plan (the "Plan"). (Decl. of Jennifer Walsh on Def.'s Opening Br.
("Walsh Decl.") Ex. A (the "Plan Articles") BAY256, Mar. 26, 2012, ECF No. 14-1.) Bayer funds all short-term disability ("STD") benefits paid out under the Plan. (Plan Articles BAY256.)
Bayer has "the exclusive right to make any finding of fact necessary or appropriate for any purpose under the Plan including, but not limited to, the determination of the eligibility for . . . any benefit payable under the Plan." (Plan Articles BAY257.) Bayer also has "the exclusive discretionary right to interpret the terms and provisions of the Plan and to determine any and all questions arising under the Plan or in connection with the administration thereof . . . ." (Plan Articles BAY257.)
Bayer may appoint individuals "to act on its behalf." (Plan Articles BAY256.) Bayer has allegedly delegated its authority to administer the Plan to Bayer Corporate and Business Services LLC ("BCBS"). (Walsh Decl. Ex. F (the "ERC Articles") BAY430, Mar. 26, 2012, ECF No. 14-4.)
BCBS has hired The Prudential Insurance Company of America ("Prudential") to serve as the "third party administrator," which determines the initial eligibility of any new claim under the Plan. (Walsh Decl. Ex. C (the "Admin. Servs. Agreement" ("ASA")) BAY381-426, Mar. 26, 2012, ECF No. 14-4.) Prudential receives a monthly fee and compensation based on the total number of covered employees; Prudential does not receive financial incentives to deny claims. (ASA BAY416-17.) Under the terms of the ASA, BCBS retains complete authority over the administrative appeals process. (ASA BAY391.)
BCBS organized the ERISA Review Committee (the "ERC") to "adjudicate disputed claims" after Prudential has terminated a claim and the employee has filed an appeal. (ERC Articles BAY430.) Although the ERC Members are BCBS employees or directors,*fn2 they do not receive a salary for their services to the ERC. (ERC Articles BAY430, BAY432.)
Under the terms of the ERC Articles, ERC Members are allegedly invested with BCBS's "full discretionary authority" for ERC purposes. (ERC Articles BAY434.) In addition:
the Members . . . may rely in good faith upon information, opinion, reports or statements, prepared by (i) one or more employees or officers of [BCBS] whom the Members reasonably believe to be reliable and competent in the matters presented, or (ii) legal counsel, public accountants, physicians, insurance company claims reviewers, or other persons as to matters which Members reasonably believe to be within the professional or expert competence of such person.
BCBS reserves the right to determine if an employee is "disabled" under the terms of the Plan. (Walsh Decl. Ex. B (the "Summary Plan Description" ("SPD")) BAY354, Mar. 26, 2012, ECF Nos. 14-2, 14-3.) If conflicting medical opinions exist, BCBS reserves the right to determine which opinion "more plausibly or credibly assesses" the employee's condition. (SPD BAY354.)
To qualify as "disabled," the Plan requires that: (1) the employee be "under the care of a physician whose specialty or experience is appropriate" to the condition; and (2) "based on objective medical evidence" of the illness or injury, the employee cannot do his or her job. (SPD BAY354.) In determining whether an employee is disabled, BCBS may take into account "the possibility of reasonable accommodations or the availability of medication, surgery, or other forms of treatment" that would permit the employee to perform his or her job functions. (SPD BAY354.) "Disability" excludes "employment-related mental or emotional disabilities." (SPD BAY353.)
Plaintiff was employed by Bayer as a "medical liaison" and is covered by the Plan. (Admin. R. ("AR") BAY14, BAY50, Mar. 21, 2012, ECF Nos. 12-1, 12-2, 12-3, 12-4.)
On December 8, 2007, Plaintiff's doctor, Ian Yip, reported that Plaintiff had symptoms of fibromyalgia, fatigue, weight gain, and irritable bowel syndrome ("IBS"). (AR BAY14.) Over the next six months, through May 22, 2008, Dr. Yip observed Plaintiff several more times and reported symptoms of exacerbated fibromyalgia, insomnia, chronic fatigue, and lack of concentration. (AR BAY14-28.) Dr. Yip prescribed rest, stress reduction, improved diet, physical therapy three times per week for six weeks, psychotherapy (for the fatigue), and Lyrica (a neuropathic painkiller to treat the fibromyalgia). (AR BAY14-28.) Throughout this six month period, Plaintiff reported substantial pain. (AR BAY14-28). On March 18 and April 24, Plaintiff was feeling "slightly better." (AR BAY26-27.) The Lyrica seemed to help. (AR BAY26.)
From February 14, 2008 through May 19, 2008, Plaintiff attended twenty-two physical therapy sessions at Gillette and Associates Physical Therapy ("Gillette"). (AR BAY7-13.) The reports from Gillette are mixed. On February 28, Plaintiff had "no energy" and was "unable to do housework"; throughout February, Plaintiff was "progressing gradually" and "tolerating [the treatment] well." (AR BAY10-11.) On March 20, Plaintiff had been "miserable" for two days after the last visit but felt "better" that day. (AR BAY11.) Plaintiff "tolerated [the treatment] well" and "respond[ed] well" throughout March and April. (AR BAY11-12.) On April 24, Plaintiff reported "difficulty walking [her] dog." (AR BAY12.) On May 5, Plaintiff reported difficulty with stairs; however, Plaintiff continued to "tolerate the treatment well" and "progress[ed] well." (AR BAY12-13.)
From April 1, 2008 through June 15, 2008, Plaintiff attended eleven physical therapy sessions at Cardenas and Associates Physical Therapy ("Cardenas"). (AR BAY34-48.) The reports from Cardenas are mixed. On April 1, Plaintiff reported that "daily chores are very difficult," that she "gets worn out [with] cooking," and that "running errands is fatiguing"; however, Plaintiff "tolerated . . . treatment well" and "reported feeling better" afterwards. (AR BAY34.) On April 3 and April 10, Plaintiff "appear[ed] to be feeling better." (AR BAY 39-40.) On April 23, Plaintiff reported "doing better": she had been "more active" and "able to do more around the house," even "a little work in the garden." (AR BAY 42.) However, she woke up "hurting all over." (AR BAY42.) On April 29, Plaintiff had "been feeling good overall." (AR BAY44.) Throughout April, Plaintiff "tolerated the treatment well." (AR BAY38-44.) On May 1, Plaintiff "tolerated the treatment well," "enjoyed the new exercises," and "reported feeling better" afterwards. (AR BAY45.) On June 5 - after not having attending physical therapy at either facility for three weeks - Plaintiff had "regressed": she had "pain all over" and "low energy." (AR BAY46.) However, she had "been able to continue to walk the dogs," though she still reported difficulty with stairs and cognitive ability. (AR BAY46.) On June 11, Plaintiff reported continuing back and shoulder pain. (AR BAY47.) On June 13, Plaintiff reported major pain in her legs and lower back as well as low energy; however, she did some work "around the garage" and "worked a little yesterday and today." (AR BAY48.) Throughout June, she "tolerated the treatment well" and "reported feeling better" afterwards. (AR BAY46-48.)
Plaintiff's initial claim and the subsequent administrative appeals process lasted from February 20, 2008 to September 30, 2008. On February 20, Prudential approved Plaintiff's initial claim for STD benefits. (AR BAY50.) On March 12, Prudential requested Plaintiff's medical records. (AR BAY50.) On March 27, Prudential received the medical records, reviewed them, and renewed Plaintiff's STD benefits through April 27. (AR BAY50.) On April 28, Prudential's claim manager informed Plaintiff that "additional medical information was required for an extension of benefits." (AR BAY50.) On May 2, Prudential received the information. (AR BAY50.) On May 7, Prudential determined that it needed to review Plaintiff's job description. (AR BAY50.)
Plaintiff's job description specifies that Plaintiff: (1) works 46 hours per week; (2) works indoors 100% of the time; (3) lifts objects eleven to twenty-five times per day; (4) pulls objects one to ten times per day; (5) sits frequently; (6) occasionally stands; (7) occasionally walks; (8) infrequently ascends and descends stairs; (9) infrequently stoops, bends, twists, crawls and reaches above her shoulders; and (10) travels 50% of each month. (AR BAY95-96.)
Prudential reviewed Plaintiff's job description and medical records, and determined that Plaintiff was capable of doing her job because she "did more strenuous activities at home and during therapy than are required in her sedentary position." (AR BAY50-51.) Accordingly, on May 16, Prudential terminated Plaintiff's STD benefits - effective April 28 -and informed Plaintiff via letter. (AR BAY51.) Plaintiff appealed. (AR BAY51.) On July 14, Prudential reviewed the same records, came to the same conclusion, and informed Plaintiff via letter. (AR BAY51.)
Prudential's two termination-of-STD-benefits letters, dated May 16 and July 30, are identical. (AR BAY82-87). Both letters state that: (1) "the additional medical information submitted does not support a period of continued disability"; and (2) "in order to receive benefits[,] covered employees must meet all requirements including the following definition of '[d]isability.'" (AR BAY82, BAY85.) Both letters then restate the entire SPD definition for "disability" but place in bold the following segment: "The possibility of reasonable accommodation or the availability of medication, surgery or other forms of treatment which would permit you to perform your job may be considered . . . in determining disability." (AR BAY82, BAY85.) In conjunction with the two prior statements, this bolded text implies that Prudential did not find Plaintiff to be disabled because treatment options -presumably physical therapy and Lyrica - were available to her and would allow her to continue working at her job. Both letters state, "If you have any objective medical evidence or other documentation to support your claim, it is very important to submit it with your appeal." (AR BAY83, BAY86.) Both letters include an appeal request form, which also explains the appeals procedure. (AR BAY84, BAY87.)
On July 7, Plaintiff sent her medical records and an appeal request form to the ERC; she wrote on the form that "psychologist notes will be mailed separately." (AR BAY4.) On July 21, Plaintiff sent a separate letter to the ERC in which she stated that she had not sent her psychotherapist records and would send them only upon request "because of their sensitive nature." (AR BAY5.)
On August 18, Dr. Bill Hennessey reviewed Plaintiff's medical records at the ERC's request. (AR BAY211-12.) He noted that Plaintiff "is independent in her activities of daily living" and does not require a wheelchair, crutch, or cane. (AR BAY211.) He noted that Plaintiff walks her dog, had worked in the garden in April, and can drive (with an increase in pain ...