Tyler v. United States Life Insurance Co. In City of New York

          ORDER

          G. Murray Snow Chief United States District Judge.

         Pending before the Court is Defendant United States Life Insurance Company in the City of New York's Motion for Partial Summary Judgment (Doc. 172). For the following reasons the motion is denied.^[1]

         BACKGROUND

         At the summary judgment stage, Plaintiff Kelly Ann Tyler's evidence “is to be believed, and all justifiable inferences are to be drawn in [her] favor.” See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Disputed facts are “viewed in the light most favorable to” Tyler, the non-moving party. See Scott v. Harris, 550 U.S. 372, 380 (2007).

         Tyler filed this action against United States Life Insurance Company and American General Life Insurance Company (together, “American General”). Tyler alleges breach of a disability insurance contract with American General to provide monthly payments to Tyler in the event that she became “totally disabled.” She also alleges a breach of the covenant of good faith and fair dealing by American General, and seeks punitive damages.

         Tyler applied for a group long-term disability insurance policy underwritten by American General. The agreement defines “total disability” as “your complete inability to perform the substantial and material duties of your Current Occupation beyond the end of the Elimination Period, and you are not engaged in any other occupation.” (Doc. 172 at 3). “Current Occupation” means “[t]he duties of the medical specialty then being practiced or of the occupation being performed immediately prior to the disability.” (Id.) Tyler practiced as a psychiatrist for the VA in Phoenix.

         In March 2012, Tyler submitted a claim to American General for total disability because of chronic pain, fatigue, post-herpetic neuralgia, Mollarets meningitis, and chronic migraines. American General approved the claim after receiving additional information from Tyler. American General notified Tyler that it would periodically request updated medical records in order to reevaluate the ongoing nature of Tyler's disability.

         In July 2014, Tyler's case was transferred to Linda Donahue, a case manager at American General. Donahue reviewed the case file and notified Tyler that her claim was still medically supported. Donahue also requested updated records. In those records, Donahue received an updated report from Tyler's primary physician, Dr. Crever, which stated that Tyler was currently physically unable to work because it was hard to predict the flare-ups that caused her headaches. (Doc. 183-3 at 105-06).

         After reviewing the updated records and noting apparent inconsistencies (including the fact that Tyler had stopped preventative therapy for migraines while attempting to become pregnant), Donahue sent the case file to Health Direct, Inc. (“HDI”)-a third-party medical services provider-for evaluation. During its review of Tyler's records, HDI unsuccessfully attempted to contact some of Tyler's treating physicians.

         HDI's report noted that Tyler continued to suffer from frequent severe headaches, but concluded that “[Tyler's] inability to [return to work] . . . [f]ull [t]ime does not appear supported based on the most recent medical exam findings” from Tyler's rheumatologist and neurologist. (Doc. 173-11 at 2). HDI recommended to Donahue that Tyler's case be referred to an independent medical provider for peer review. Donahue agreed. HDI then sent Tyler's case to CompPartners, Inc., a company that facilitates independent medical reviews. CompPartners sent Tyler's case to Dr. Alberto Ramos, a board-certified neurologist.

         Ramos reviewed Tyler's records and concluded that the extent to which Tyler's migraines were disabling was unclear because she had discontinued preventative therapy while trying to become pregnant. He noted that the medications she was still taking, however, had side effects which prevented Tyler from being able to drive. Ramos further noted that the frequency of Tyler's migraines had decreased since she initially filed the claim. Finally, Ramos noted that-according to the medical records-Tyler had “no gross motor or fine motor abnormalities that would limit [Tyler's] ability to work” and that there were also “no side effects from medications that would impair the claimant, ” (Doc. 173-22 at 3). Ramos concluded that although Tyler was “limited by her chronic migraines, ” they had improved with some medications and so there were no cognitive or physical limitations affecting Tyler's ability to return to work.

         After reviewing the reports from HDI and Dr. Ramos, Donahue concluded that Tyler's claim was no longer medically supported. She sent Tyler a letter informing her that American General had “determined that there is no medical evidence to support any ongoing restrictions or limitations to your activity which would prevent you from performing the material and substantial duties of your regular occupation.” (Doc. 173-23 at 3). The letter explained the grounds for the decision and informed Tyler of her right to appeal.

         In response, Tyler's attorney sent a letter to American General informing them that Tyler's condition had recently worsened, resulting in Tyler's hospitalization. Donahue responded that the termination decision had been based on records received prior to January 1, 2015, and requested any additional medical records after that date. Tyler sent updated records. Donahue sent them back to HDI for further review. HDI reviewed the records and again recommended third-party review, and the updated records were sent back to Dr. Ramos for a second evaluation. This time, Ramos concluded that while Tyler continued to suffer from severe migraines that functionally impaired her work, she could return to former job if given flexible leave when experiencing a migraine (up to two hours at a time, up to four times per month) and a dark, private place to rest when experiencing a migraine at work. Ramos also recommended that Tyler avoid severe work-related stress that could trigger the headaches.

         Donahue reviewed the report from Ramos and sent the file to an in-house vocational rehabilitation counselor. The counselor concluded, based on the Ramos reports, that “Dr. Tyler currently does have the physical capacity to perform her Current Occupation” if given the accommodations noted by Ramos. (Doc. 173-33 at 5). Based on the second Ramos report and the report from the vocational counselor, Donahue concluded that Tyler could perform the essential functions of her regular occupation if given the stated accommodations. Donahue sent Tyler a letter to this effect, again ...