United States District Court, N.D. California, San Jose Division
ORDER DENYING PLAINTIFF'S MOTION AND GRANTING
DEFENDANT'S CROSS MOTION FOR JUDGMENT [Re: ECF
LAB SON FREEMAN United States District Judge
Jennifer Kott (“Kott”) challenges the denial of
her disability claim by Sedgwick Claims Management Services,
Inc. (“Sedgwick”) under the Agilent Technologies,
Inc. Disability Plan (the “Plan”), an employee
benefits plan governed by ERISA. Kott sought disability
claims because of back pain and severe plantar fasciitis in
her foot. Sedgwick, as the administrator of the Plan,
initially granted 52 weeks of benefits under the “own
occupation standard.” Ex. 2 to Pl. Mot. at 987.
However, Sedgwick denied Kott's claims of disability
under the “any occupation” standard so the
benefits did not continue past February 2016 after 52 weeks.
Ex. 7 to Pl. Mot at 321-23.
parties have filed cross motions for judgment pursuant to
Federal Rule of Civil Procedure 52. Kott seeks a
determination that she was disabled under the “any
occupation” standard and Defendant seeks a contrary
determination. The Court set a “Hearing on Dispositive
Motions/Bench Trial” for June 15, 2017 and heard
extensive oral argument of counsel on that date. For the
reasons discussed below, the Court DENIES Kott's Rule 52
motion, issues Findings of Fact and Conclusions of Law under
Rule 52, and GRANTS Defendant's motion.
Rule of Civil Procedure 52 provides that “[i]n an
action tried on the facts without a jury . . . the court must
find the facts specially and state its conclusions of law
separately.” Fed.R.Civ.P. 52(a)(1). “In a Rule 52
motion, as opposed to a Rule 56 motion for summary judgment,
the court does not determine whether there is an issue of
material fact, but actually decides whether the plaintiff is
[entitled to benefits] under the policy.” Prado v.
Allied Domecq Spirits and Wine Group Disability Income
Policy, 800 F.Supp.2d 1077, 1094 (N.D. Cal. 2011)
(citing Kearney v. Standard Ins. Co., 175 F.3d 1084,
1095 (9th Cir. 1999)). In making that determination, the
court must “evaluate the persuasiveness of conflicting
testimony and decide which is more likely true” in
order to make findings of fact that will be subject to review
under a clearly erroneous standard if appealed.
Kearney, 175 F.3d at 1095.
an ERISA plan confers discretionary authority upon a plan
administrator to determine eligibility for benefits, the
administrator's decision to deny benefits is reviewed for
abuse of discretion. Firestone Tire and Rubber Co. v.
Bruch, 489 U.S. 101, 115 (1989); Nolan v. Heald
College, 551 F.3d 1148, 1153 (9th Cir. 2009). Under a
straightforward application of the abuse of discretion
standard, “the plan administrator's decision can be
upheld if it is grounded in any reasonable
basis.” Montour v. Hartford Life & Acc. Ins.
Co., 588 F.3d 623, 629 (9th Cir. 2009) (internal
quotation marks and citation omitted) (emphasis in original).
the parties do not dispute that the Plan grants discretionary
authority to decide claims and appeals to Sedgwick. Pl. Mot.
(“Mot.”) 14, ECF 29; Def. Cross-Mot., Opp'n
10 (“Opp'n”), ECF 30. The Court thus will
apply an abuse of discretion standard of review. See
Firestone, 489 U.S. at 110-111. Under this standard of
review, the plan administrator's decision will be upheld
if it is reasonable, but the plan administrator should be
found to have abused its discretion if its decision is
“illogical, implausible, or without support in
inferences that may be drawn from the facts in the
record.” Salomaa v. Honda Long Term Disability
Plan, 642 F.3d 666, 676 (9th Cir. 2011).
submitted documents outside the administrative record,
including Exhibits 13, 16, and 17 for the Court's
consideration. Mot. 6, 13-14. The parties do not dispute that
these exhibits are not in the administrative record and that
they are dated in March 2017, far beyond the April 26, 2016
date of Sedgwick's denial of Kott's appeal. Mot. 6
n.2; Opp'n 10. However, Kott contends that that she is
entitled to submit evidence outside of the record because of
“procedural irregularity” that affected the
administrative review. Mot.6 n.2; Reply 10 n.3. Defendant
objects to the introduction of these exhibits because they
were not before Sedgwick when it denied Kott's claims.
respect to Exhibit 13, this exhibit includes a letter from
Dr. Justin Low and an event and appointment log, purportedly
showing that Dr. Low has never had any communications with
any care managers, lawyers or administrators regarding
Kott's care or management, which is contrary to evidence
relied on by Sedgwick in its final denial letter. Ex. 13 to
Mot. Kott claims that this exhibit should be considered
because Sedgwick relied on a conversation between Dr. Low and
Dr. Mardy-Davis for the first time on appeal in the denial
letter. Id.; Mot. 6 n.2. Defendant argues that
regardless of whether the telephone call occurred, it had no
impact on the rationale set forth in the denial letter.
Id. at 11-12.
determining whether the [plan administrator] abused its
discretion, the Court's review is limited to the
administrative record.” Cuevas v. Peace Officers
Research Ass'n of Cal. Legal Def. Fund, No.
14-02540-BLF, 2016 WL 2754434, at *8 (N.D. Cal. May 12, 2016)
(citing Abatie v. Alta Health & Life Ins. Co.,
458 F.3d 955, 970 (9th Cir. 2006)). “[I]n general, a
district court may review only the administrative record when
considering whether the plan administrator abused its
discretion. . . .” Abatie, 458 F.3d at 970.
The “administrative record consists of the papers the
[plan administrator] had when it denied the claim.”
Kearney, 175 F.3d at 1096. “The court may not
consider information outside the administrative record, as it
would be improper to find a claims administrator abused its
discretion based on evidence not before it at the time the
decision was made.” Thompson v. Ins. & Benefits
Trust/Comm. Peace Officers Research Ass'n of
California, 670 F.Supp.2d 1052, 1068 (E.D. Cal. 2009).
that the Court is applying the abuse of discretion standard
here, evidence extraneous to the record before Sedgwick, such
as Exhibit 13, cannot be considered here. These exhibits were
not before Sedgwick when it denied Kott's disability
claim and are not part of the record. Relying on
Abatie, Kott attempts to characterize Sedgwick's
denial letter's reference of the phone call between Dr.
Low and Dr. Mardy-Davis as a procedural error. Kott then
argues that this procedural error supports consideration of
evidence extraneous to the record. However, this mere
reference in the denial letter is not the type of procedural
error that warrants the introduction of outside evidence in
accordance with the holding in Abatie. In
Abatie, an insurer denied life insurance benefits to
plaintiff because the decedent had not filed a waiver of
premium application (based on disability) and had not paid
his premiums, and coverage lapsed before the decedent died.
Abatie, 458 F.3d at 960. In the initial denial, the
denial of coverage was based on insufficient evidence showing
a waiver. Id. at 961. When the subsequent appeal was
denied, the insurer - for the first time on an administrative
appeal - added a second reason: that “it was denying
coverage because there was insufficient evidence in the
record that [the decedent] had remained totally disabled from
the time he left work until his death.” Id.
The Ninth Circuit in Abatie noted that an
“administrator's last minute reliance on a new
ground for denial of benefits,  afforded [the plaintiff] no
opportunity to present relevant evidence in advance of the
administrator's final decision.” Id. at
971. As such, the court held that under such circumstances,
the trial court “may take additional evidence”
because “the irregularities have prevented full
development of the administrative record.” Id.
is not analogous to the situation here. A review of the final
denial letter reveals that the denial was based on the review
of medical records and the summaries of all the independent
reviewers and a vocational specialist. The mere mention of a
teleconference between Dr. Mardy-Davis and Dr. Low does not
present a novel ground in support of the denial. As such,
Defendant's objection to Exhibit 13 is sustained.
the Court will not consider Exhibits 16 and 17 as they were
not before Sedgwick when it denied her disability claim and
are not part of the record. Exhibit 16 is another letter by
Dr. Low, providing an update with regard to Kott's
current functional status due to her back and foot
conditions. Ex. 16 to Mot. Exhibit 17 includes a medical
record pertaining Kott's current health status regarding
diagnosis and treatment for breast cancer. Ex. 17 to Mot.
Kott offers these exhibits as information that Sedwick must
consider on remand. Mot. 13-14. For the same reason the Court
sustains Defendant's objection to Exhibit 13, the
objections to Exhibits 16 and 17 are also sustained.
FINDINGS OF FACT
worked as an Import Compliance Specialist at Agilent
Technologies, Inc. up to the date of disability, February 11,
2015. AR 150, 570-74. Kott holds a Customhouse Broker's
License, is certified as an export specialist, and has 8 or
more years of “general education, college, seminars,
and on the job training.” AR 148.
relevant times, Kott was a participant in the Agilent
Technologies, Inc. Disability Plan (the “Plan”),
which is a self-funded disability plan (i.e.
benefits are funded by Agilent Technologies, Inc.
(“Agilent”), not through an insurer). ERISA
§ (1)(A), 29 U.S.C. § 1002(1)(A).
the terms of the Plan, a participant qualifies as
“Totally Disabled” if:
During the first fifty-two (52) weeks following the onset of
the injury or sickness, the Member is continuously unable to
perform each and every duty of ...