United States District Court, D. Arizona
G. Campbell United States District Judge
parties have filed briefs on the merits of this ERISA case.
Docs. 26, 29. Defendant Prudential Insurance Company of
America styled its opening brief as a motion for summary
judgment, to which Plaintiff has responded. Doc. 24, 31.
Despite this difference in briefing, Plaintiff agrees that
the Court can resolve this case on the merits. Doc. 31 at
The Ninth Circuit has also noted that, “[i]n the ERISA
context, a motion for summary judgment is merely the conduit
to bring the legal question before the district court and the
usual tests of summary judgment, such as whether a genuine
dispute of material fact exists, do not apply.”
Harlick v. Blue Shield of California, 686 F.3d 699,
706 (9th Cir. 2012) (quotation makes and citation omitted).
After reviewing the merits of this case, the Court finds that
Plaintiff is entitled to relief.
was employed with Comtech Telecommunications Corporation from
June 16, 1997, until March 10, 2015. AR 85. Plaintiff
participated in an employee welfare benefit plan that
provided coverage for short-term and long-term disability
(the “Plan”). Doc. 24 at 3. Plaintiff worked as a
“Technician III” and made repairs on satellite
communications equipment. AR 820-21, 843. Plaintiff alleges
that his job required the continual use of his hands and
constant sitting, standing, climbing, and crouching. Doc. 26
2007, Plaintiff suffered from severe headaches and required
spinal surgery to correct the problem. Id. at 9-10.
According to Plaintiff, the performing surgeon “was
clear the surgery didn't permanently ‘fix' the
problem, and that [Plaintiff] should expect his symptoms to
re-occur.” Id. In 2011, Plaintiff began
suffering severe back and arm pain related to his spinal
condition. Id. Plaintiff asserts that he went on
light duty work in 2011 at his physician's request.
Id. His work restrictions included limits on
“sitting, standing and lifting.” AR 538.
continued to work full-time for Comtech with the aid of pain
relieving shots and medication. On March 10, 2015, he was
terminated as part of a Reduction in Force
(“RIF”). Doc. 26 at 10-11; AR 843, 865, 867.
Plaintiff alleges that he learned of the RIF on March 9,
2015. Doc. 26 at 11. Plaintiff immediately spoke with his
“boss's boss, ” Brian Rogge, and asked
whether he would be laid off as part of the RIF. If so, he
asked permission to file for disability instead. Id.
Plaintiff asserts that Mr. Rogge assured him:
“you're good, ” which led Plaintiff to
believe he would not be laid off and should not file for
disability. Id. Plaintiff was terminated the next
day. Id. At his termination meeting, Plaintiff again
asked to file for disability, and asked Comtech Human
Resources staff for the paperwork to make a claim.
Id. Staff did not provide Plaintiff with the
paperwork, and he was escorted from the building.
April 14, 2015, Plaintiff filed a claim for short-term
disability (“STD”) benefits under the Plan with
Defendant Prudential, the Plan administrator. Id. at
13; AR 109. On April 22, 2015, Prudential issued a letter
denying Plaintiff's claim because he did not have
coverage under the Plan at the time of his disability, which
Prudential found to be March 11, 2015. AR 830. On September
2, 2015, Plaintiff appealed the decision and filed a new
claim for long-term disability (“LTD”) benefits.
AR 128. On November 20, 2015, Prudential issued Plaintiff two
letters: one rejecting his appeal of the STD benefits claim,
and a second denying the LTD benefits claim. Doc. 24 at 8. On
January 19, 2016, Plaintiff appealed a second time, this time
submitting 290 pages of his medical records in addition to
the appeal paperwork. AR 238. Prudential denied the second
appeal in a letter dated February 25, 2016, concluding again
that Plaintiff was not covered on the March 11, 2015 date of
his alleged disability. AR 856-58. Prudential's letter
acknowledged that Prudential did not conduct a review of
Plaintiff's submitted medical records. Id.
Prudential stated that such a review was unnecessary
“because [Plaintiff's] claim was being denied for a
lack of coverage.” Id.
March 22, 2016, Plaintiff filed this action seeking to
recover benefits under the Plan. Doc. 1. The issues are fully
briefed, and oral argument will not aid in the Court's
Standard of Review.
allows a participant to bring an action “to recover
benefits due to him under the terms of his plan.” 29
U.S.C. § 1132(a)(1)(B). Generally, a district court
conducts de novo review of a denial of benefits.
Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101, 115 (1989). When a plan “unambiguously provide[s]
discretion to the administrator” to interpret the terms
of the plan and make final benefits determinations, however,
the determination is reviewed for an abuse of discretion.
Abatie v. Alta Health & Life Ins. Co., 458 F.3d
955, 963 (9th Cir.2006) (en banc). Defendants bear the burden
of proving an ERISA plan's grant of discretionary
authority. See Prichard v. Metro. Life Ins. Co., 783
F.3d 1166, 1169 (9th Cir. 2015); see also Kearney v.
Standard Ins. Co., 175 F.3d 1084, 1089 (9th Cir. 1999).
argues that the appropriate standard of review is de
novo because the Plan does not contain an unambiguous
grant of discretion. Plaintiff concedes that “there is
a purported grant of discretion in” the Summary Plan
Description (“SPD”), but argues that this grant
is insufficient “because the discretionary language is
contained only in the SPD” and “is not binding,
unless it is incorporated into the Plan.” Doc. 26 at
Court agrees. Statements in the SPD “do not themselves
constitute the terms of the plan.” See Cigna Corp.
v. Amara, 563 U.S. 421, 438 (2011). The SPD is a
statutorily-required document provided by the administrator
of any employee benefit plan to participants and
beneficiaries of that plan, and is intended to “be
written in a manner calculated to be understood by the
average plan participant.” 29 U.S.C. § 1022(a).
The SPD contains information “about the plan, ”
but is not itself “part of the plan.”
Amara, 563 U.S. at 436. The SPD cannot override or
supplement the terms of other plan documents.
Prichard, 783 F.3d at 1170. “[W]here - as here
- a [SPD] is not incorporated in the plan document, and is
‘absent from documents listed in [the] plan's
integration clause, ' a grant of discretion in the [SPD]
plainly cannot be considered a term of the Plan.”
Murphy v. California Phys. Servs., --- F.Supp.3d.
---, 2016 WL 568 2567 at *5 (N.D. Cal. Oct. 3, 2016) (citing
Prichard, 783 F.3d at 1170-71).
argues that the SPD is part of the Plan and that its grant of
discretion is valid. Prudential argues that Amara
does not hold “that [a grant of] discretion cannot be
contained in an SPD, ” but rather “implies that,
though not in all cases, the SPD may be enforced as a plan
term when it does not contradict a plan.” Doc. 24 at
11. Prudential contends that because “[t]he SPD here
does not conflict with the other governing plan documents . .
. it constitutes a plan document and the grant of discretion
to Prudential contained there is valid.” Id.
In support, Prudential cites Eugene S. v. Horizon Blue
Cross Blue Shield of N.J., 663 F.3d 1124, 1131 (10th
Cir. 2011), which stated:
We interpret Amara as presenting either of two fairly simple
propositions, given the factual context of that case: (1) the
terms of the SPD are not enforceable when they conflict with
governing plan documents, or (2) the SPD cannot create terms
that are not also authorized by, or reflected in, governing
Eugene S., 663 F.3d at 1131. The court found it
unnecessary to determine which proposition applied because
the SPD at issue “does not conflict with the Plan or
present terms unsupported by the Plan; rather it is
the Plan.” Id. (emphasis in original). The SPD
stated in the introduction “that it, along with the
individual Certificate of Coverage[, ] forms the Group
Insurance Certificate; that it is made part of the Group
Policy; and that all benefits are subject in every way to the
entire Group Policy, which includes the SPD.”
Id. at 1132 (internal quotations omitted).