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Vaccaro v. Liberty Life Assurance Co. of Boston

United States District Court, N.D. California, San Jose Division

November 20, 2017

MELISSA VACCARO, Plaintiff,
v.
LIBERTY LIFE ASSURANCE COMPANY OF BOSTON, Defendant.

          ORDER GRANTING PLAINTIFF'S MOTION FOR JUDGMENT UNDER RULE 52 AND DENYING DEFENDANT'S MOTION FOR JUDGMENT UNDER RULE 52 FINDINGS OF FACT AND CONCLUSIONS OF LAW [Re: ECF 31, 32]

          BETH LABSON FREEMAN United States District Judge

         I. INTRODUCTION

         Plaintiff Melissa Vaccaro (“Vaccaro”) filed this ERISA[1] action against Defendant Liberty Life Assurance Company of Boston (“Liberty”) following Liberty's denial of her claim for long term disability benefits (“LTD benefits”) under a group insurance policy that Liberty issued to Vaccaro's former employer, NetApp, Inc. (“NetApp”). The policy is one component of NetApp's Group Health Plan, a welfare benefit plan offered by NetApp to provide its employees with medical, dental, vision, life, and disability benefits.

         The Liberty policy classifies employees as either “Class 1” or “Class 2.” The primary difference between the two classes is the showing required to establish disability. Class 1 employees need show only an inability to perform their “own occupation” in order to be considered disabled through the policy coverage period. In contrast, Class 2 employees must show an inability to perform their “own occupation” for the first 24 months of coverage and thereafter must show an inability to perform “any occupation” for the remainder of the coverage period. Liberty classified Vaccaro as a Class 2 employee and denied her claim for benefits. Vaccaro contends that she is a Class 1 employee, and she filed this action to obtain a determination that she is entitled to past-due and future LTD benefits under the own occupation standard applicable to Class 1 employees. After the litigation commenced, Liberty reversed its prior claim denial and paid all past-due benefits. However, Liberty affirmed its classification of Vaccaro as a Class 2 employee.

         The Court conducted a bench trial on the parties' cross-motions for judgment under Federal Rule of Civil Procedure 52. In light of Liberty's disability determination and payment of past-due benefits, the only substantive issue remaining for disposition is whether Vaccaro is a Class 1 employee or a Class 2 employee. Having considered the briefing, the evidence, and the oral argument presented at the bench trial, the Court concludes that she is a Class 1 employee. The Court therefore GRANTS Vaccaro's Rule 52 motion and DENIES Liberty's Rule 52 motion.

         II. LEGAL STANDARD

         Federal 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.

         III. FINDINGS OF FACT

         A. Vaccaro's Employment

         1. Vaccaro was employed by NetApp in its human resources department. Madrigal Decl. ¶ 10, ECF 31-5.

         2. Her “Job Title, ” as stated in the “NetApp Job Description, ” was “HR Program Mgr 5.” NetApp Job Description, Exh. 6 to Madrigal Decl., ECF 31-11.

         3. Her “Job Code” per the NetApp Job Description was “445.” Id.

         4. Her “Job Level” per the NetApp Job Description was “Individual Contributor 5.” Id.

         5. Instead of using the official job title stated in the NetApp Job Description, Vaccaro and/or her manager chose to use the title “Global Leadership and Talent Development Program Manager” for Vaccaro's position. Madrigal Opp. Decl. ¶ 14, ECF 33-12.

         B. Vaccaro's Disability

         6. In 2012, Vaccaro began having symptoms of pain and fatigue. Vaccaro Decl. ¶ 8, Exh. 1 to Keenley Decl., ECF 32-1.

         7. Despite medical care, her symptoms worsened throughout 2013 and 2014. Id. ¶ 9.

         8. She tried working from home three days a week, but she found it increasingly difficult to perform her job even with that accommodation. Id. ¶ 10.

         9. Her cognitive abilities began to deteriorate, particularly in the areas of memory and comprehension. Id. ¶ 6.

         10. By April 2015, her abilities deteriorated to such an extent that she was unable to continue performing her job. Id. ¶¶ 2, 6.

         11. Vaccaro's last day of work was April 29, 2015. Claim Denial at 1, Exh. 8 to Keenley Decl., ECF 32-1.

         C. NetApp Group Health Plan and Liberty Policy

         12. Vaccaro was a participant in NetApp's Group Health Plan. The Group Health Plan initially was established effective June 1, 1996. Madrigal Decl. ¶ 4, ECF 31-5.

         13. The Group Health Plan was amended and restated effective January 1, 2015 (“2015 Group Health Plan”). See 2015 Group Health Plan, Exh. 10 to Keeney Decl., ECF 32-1.

         14. The Group Health Plan again was amended and restated effective January 1, 2016 (“2016 Group Health Plan”). See 2016 Group Health Plan, Exh. 1 to Madrigal Decl., ECF 31-6.

         15. The relevant provisions of the 2015 Group Health Plan and the 2016 Group Health Plan do not differ materially. Accordingly, this Order refers to “the Group Health Plan” and provides citations to both the 2015 Group Health Plan and the 2016 Group Health Plan.

         16. The first page of the Group Health Plan states that NetApp, the Plan Sponsor and the Plan Administrator, “at any time and from time to time may amend, change or terminate the Plan without the consent of any Covered Person or any other persons entitled to receive payment of benefits under the Plan.” 2015 Group Health Plan at i, Exh. 10 to Keeney Decl., ECF 32-1; 2016 Group Health Plan at i, Exh. 1 to Madrigal Decl., ECF 31-6.

         17. The Group Health Plan is defined to incorporate “Component Plans, ” meaning medical, dental, and other benefit plans adopted by NetApp. 2015 Group Health Plan at 1, Exh. 10 to Keeney Decl., ECF 32-1; 2016 Group Health Plan at 2, Exh. 1 to Madrigal Decl., ECF 31-6.

         18. The Group Health Plan grants NetApp, as the Plan Administrator, authority to “interpret the terms and provisions of the Plan” and to “determine eligibility under the Plan.” 2015 Group Health Plan at 24, Exh. 10 to Keeney Decl., ECF 32-1; 2016 Group Health Plan at 24, Exh. 1 to Madrigal Decl., ECF 31-6.

         19. One of the Component Plans which is incorporated into the Group Health Plan is an insurance policy for LTD benefits issued by Liberty in 2012 and reissued effective January 1, 2015. 2015 Group Health Plan at A-1, Exh. 10 to Keeney Decl., ECF 32-1; 2016 Group Health Plan at A-2, Exh. 1 to Madrigal Decl., ECF 31-6; Madrigal Decl. ¶ 5, ECF 31-5.

         20. The Liberty policy reissued in 2015 (“2015 Policy”) provides LTD benefits for two classes of employees, Class 1 employees and Class 2 employees. 2015 Policy at SCH-1, Exh. 2 to Madrigal Decl., ECF 31-7.

         21. The 2015 Policy defines Class 1 employees as follows:

Class 1: CEO, President, Vice President, Corporate Officers, Directors, Managers, and Engineers

2015 Policy at SCH-1, Exh. 2 to Madrigal Decl., ECF 31-7.

         22. The 2015 Policy defines Class 2 employees as follows:

Class 2: All other Employees

2015 Policy at SCH-1, Exh. 2 to Madrigal Decl., ...


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