FILED United States Court of Appeals UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT June 21, 2018 _________________________________ Elisabeth A. Shumaker Clerk of Court JOHN DARDICK,
Plaintiff - Appellant,
v. No. 17-1412 (D.C. No. 1:16-CV-02838-LTB-KLM) UNUM LIFE INSURANCE COMPANY (D. Colo.) OF AMERICA, a Maine corporation; FIRST UNUM LIFE INSURANCE COMPANY, a New York corporation,
Defendants - Appellees. _________________________________
ORDER AND JUDGMENT* _________________________________
Before BRISCOE, MATHESON, and EID, Circuit Judges. _________________________________
John Dardick brought this action under the Employee Retirement Income
Security Act (ERISA) after being denied long-term disability benefits by Unum Life
Insurance Company of America and First Unum Life Insurance Company (Unum).
He claimed benefits under a group disability benefits plan provided by his former
* After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist in the determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. employer, Westcon Group, Inc. (Westcon). The district court entered judgment for
Unum, and Mr. Dardick appeals. We affirm.
I. BACKGROUND
Mr. Dardick worked for Westcon as a Vice President of Cloud Services until
August 21, 2015, when he stopped working due to chronic coronary artery disease
and related conditions. He applied for disability benefits in early August 2015.
Unum approved short-term benefits through December 23, 2015, after considering
Mr. Dardick’s coronary artery disease and the recovery periods required for two
surgeries he underwent in late 2015.
Mr. Dardick applied for long-term disability benefits based on the opinions of
Dr. Bradley Fanestil, an internist, and Dr. Nelson Trujillo, a cardiologist, who stated
that he could not perform his job due to his chronic coronary artery disease, angina,
stress, depression, and anxiety. Unum denied long-term benefits on January 12,
2016, concluding that the medical records did not support restrictions that would
prevent Mr. Dardick from performing his regular sedentary occupation.
Mr. Dardick filed an administrative appeal on April 22, 2016, and provided a
report from Dr. Fanestil. Dr. Fanestil stated that Mr. Dardick should not return to
work, noting that the stress of work was contributing to his cardiovascular problems.
Dr. Fanestil also started Mr. Dardick on a trial of bupropion to treat depression, but
he was unable to tolerate the bupropion, so he stopped taking it after a couple of
weeks. Unum had Susan Grover, a nurse clinical consultant, review the file. She
found no support for a finding of disability. In addition, Unum sought advice on
2 Mr. Dardick’s job requirements from Richard Byard, a vocational consultant. Mr.
Byard modified the initial classification of Mr. Dardick’s position as Systems Project
Manager to Cloud Solution Manager, and determined that it required sedentary
activity. He recognized that Mr. Dardick claimed his particular occupation required
extensive travel, but as normally performed, the position did not require extensive
travel. Based on Ms. Grover’s and Mr. Byard’s reports, Unum denied benefits.
Mr. Dardick filed a further administrative appeal. He included reports from
Drs. Fanestil and Trujillo, both of whom opined that Mr. Dardick was unable to
return to his previous occupation. Unum had the additional evidence reviewed by
Mr. Byard and Ms. Grover. Mr. Byard further revised his determination of
Mr. Dardick’s occupational requirements, and again determined that it required
sedentary physical exertion and occasional travel. Ms. Grover requested additional
review of the medical evidence, which was performed by Dr. Chris Bartlett. Dr.
Bartlett concluded that the medical evidence did not support a finding of disability.
Unum therefore denied the second appeal.
II. THE DISABILITY PLAN
The relevant portions of the disability plan (Plan) provided that UNUM would
pay Mr. Dardick 60% of his earnings if he became disabled. Aplt. App. at 322.
Under the Plan, disability was defined as follows:
- you are limited from performing the material and substantial duties of your regular occupation due to your sickness or injury; and - you have a 20% or more loss in your indexed monthly earnings due to the same sickness or injury.
3 After 24 months of payments, you are disabled when UNUM determines that due to the same sickness or injury, you are unable to perform the duties of any gainful occupation for which you are reasonably fitted by education, training or experience. Id. at 341. The relevant terms were defined as follows:
MATERIAL AND SUBSTANTIAL DUTIES means duties that: - are normally required for the performance of your regular occupation; and - cannot be reasonably omitted or modified. ....
REGULAR OCCUPATION means the occupation you are routinely performing when your disability begins. Unum will look at your occupation as it is normally performed in the national economy, instead of how the work tasks are performed for a specific employer or at a specific location. ....
SICKNESS means an illness or disease. Disability must begin while you are covered under the plan. Id. at 354-56. The Plan further provided that Unum was a claims fiduciary for the
Plan, id. at 362, and “[b]enefits are administered by the insurer and provided in
accordance with the insurance policy issued to the Plan,” id. at 357. The parties
agree that the Plan served as both insurer and Plan administrator.
III. STANDARDS OF REVIEW
Where, as here, a “benefit plan gives the administrator or fiduciary
discretionary authority to determine eligibility for benefits or to construe the terms of
the plan,” the decision is subject to the arbitrary and capricious standard. DeGrado v.
Jefferson Pilot Fin. Ins. Co., 451 F.3d 1161, 1167 (10th Cir. 2006) (internal
4 quotation marks omitted). Under this standard, “this court upholds [the
administrator’s] determination so long as it was made on a reasoned basis and
supported by substantial evidence.” Van Steen v. Life Ins. Co. of N. Am., 878 F.3d
994, 997 (10th Cir. 2018). “The district court’s determination of whether an ERISA
benefits decision is arbitrary and capricious is a legal conclusion subject to de novo
review.” Id. at 996 (internal quotation marks omitted).
Unum’s dual role as administrator and payer of benefits “creates a conflict of
interest [such that] a reviewing court should consider that conflict as a factor in
determining whether the plan administrator has abused its discretion in denying
benefits,” Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 108 (2008). “When there
exists such a conflict of interest, we undertake a sliding scale analysis, where the
degree of deference accorded the Plan Administrator is inversely related to the
seriousness of the conflict.” DeGrado, 451 F.3d at 1167-68 (internal quotation marks
omitted). We “take a hard look at the evidence and arguments presented to the plan
administrator to ensure that the decision was a reasoned application of the terms of
the plan to the particular case, untainted by the conflict of interest.” Id. at 1168
(internal quotation marks omitted).
Mr. Dardick contends that Unum’s conflict of interest was demonstrated by its
treatment of the evidence in his case. He does not allege any circumstances, such as
“a history of biased claims administration,” that might indicate “a higher likelihood
that [the conflict of interest] affected the benefits decision,” Metro. Life Ins. Co.,
5 554 U.S. at 117. We apply these standards to our consideration of UNUM’s denial of
benefits.
IV. ANALYSIS
A. Medical Evidence
Mr. Dardick asserts Unum’s treatment of the medical evidence demonstrated
that the denial of benefits was arbitrary and capricious. First, he argues that Unum
limited the duration of his short-term disability benefits based on the anticipated
recovery time for his late-2015 percutaneous coronary intervention and bicep
surgeries, even though his disability claim was not based on those procedures but on
his chronic coronary artery disease. Thus, he asserts he was required to file two
administrative appeals to convince Unum to consider his disabling cardiac condition.1
Unum recognized that the initial application for benefits was based on
Dr. Trujillo’s diagnosis of coronary artery disease. See Aplt. App. at 286 (initial
denial decision). Unum acknowledged Mr. Dardick’s surgeries and stated that
benefits were approved based on the expected surgery-recovery duration. In
addition, Unum reviewed the notes from Dr. Trujillo’s recent examination, which
showed an echocardiogram result of 50-55%, stable angina, and a physical exam
1 Mr. Dardick makes a conclusory statement that Unum elevated the opinions of its own medical experts over those of his physicians. We decline to consider “issues adverted to in a perfunctory manner, unaccompanied by some effort at developed argumentation,” United States v. Wooten, 377 F.3d 1134, 1145 (10th Cir. 2004) (internal quotation marks omitted). Mr. Dardick also points out that Unum argued in the district court that the frequency of his medical visits did not support a disability determination. But we are here concerned with the reasons Unum relied on to deny benefits, rather than on arguments made to the district court. 6 within normal limits. Accordingly, Unum concluded that the medical records did not
demonstrate ongoing restrictions that would prevent Mr. Dardick from performing
his regular sedentary occupation. Mr. Dardick’s argument that Unum’s initial
benefits decision was based solely on surgery recovery times, rather than on his
coronary artery disease, is not supported by the record.
Mr. Dardick also complains that Unum initially requested only his recent
medical records. But since Unum ultimately received and considered all of the
relevant records, we do not find that this circumstance renders Unum’s decision
arbitrary and capricious.
Next, Mr. Dardick claims that Unum ignored the stress of his job or
erroneously considered that all job stress is the same. He relies on statements from
Drs. Trujillo and Fanestil opining that stress can contribute to or precipitate coronary
artery disease. Id. at 396, 850; see also id. at 888 (Dr. Fanestil’s opinion that
Mr. Dardick’s “symptoms and diagnoses are undoubtedly related to chronic long
term stress”). Although Dr. Fanestil’s discussion of job stress made a general
reference to failed attempts to treat this condition with medication, he did not
describe any such attempts.
Dr. Bartlett acknowledged that Mr. Dardick’s “job could indeed be stressful,”
but found that the “lack of any treatment” with appropriate medication was
inconsistent with a disabling intolerance of stress. Id. at 914. In denying benefits,
Unum determined that the following evidence refuted Mr. Dardick’s claim of
disabling stress: his physical activities, his normal physical and mental status exams,
7 the absence of any behavioral health treatment, his normalized echocardiogram, and
his exercise test results. We conclude that substantial evidence supported Unum’s
determination.
Mr. Dardick further claims that Unum erroneously equated an ejection fraction
of 55% with normal exercise tolerance. Although Dr. Trujillo stated that an ejection
fraction of 55% does not correlate to normal exercise tolerance, id. at 850,
Dr. Bartlett opined that the relevant test result showed improvement and was “now in
the normal range,” id. at 915. Unum’s decision did not rely exclusively on the
ejection-fraction result, but considered it with several other factors pertinent to
Mr. Dardick’s ability to perform the duties of his occupation, as noted above.
Therefore, even if Unum erred in its view of this test result and erroneously relied on
Dr. Bartlett’s opinion, the benefits decision was still supported by substantial
evidence.
Mr. Dardick also faults Unum for relying on “normal” examination results
from Dr. Trujillo’s notes to find that “Mr. Dardick is in general good health as
opposed to simply relatively stable at the moment of examination.” Aplt. Opening
Br. at 29. We do not agree; Unum’s reliance on the doctor’s “normal” examination
results did not make its disability decision arbitrary and capricious.
In addition, Mr. Dardick asserts that Unum unfairly relied on his ability to
exercise as evidence that he could tolerate the stress of his job. He cites to his own
statement that he expected to be able to increase his ability to exercise but not deal
with stress, Aplt. App. at 131, and to Dr. Fanestil’s statement that Mr. Dardick
8 should “focus on exercise and stress reduction (work is opposite of stress reduction)
to help remain healthy and functioning,” id. at 396. These statements do not explain
how the types of stress differ and therefore do not establish that exercise and job
stress were so different as to render Unum’s treatment of Mr. Dardick’s stress claim
Mr. Dardick also contends that Unum failed to take his anxiety and depression
into account, despite references to those conditions by Drs. Fanestil and Trujillo. But
as Dr. Bartlett observed, the record does not reflect that Mr. Dardick received
treatment for depression and anxiety, other than a brief trial of bupropion for
depression in April 2016. Mr. Dardick argues that Unum’s reliance on a lack of
treatment and on medical treatment notes indicating that he denied anxiety or
depression constitutes “cherry picking” of evidence supporting a denial of benefits.
Although Drs. Fanestil and Trujillo stated in August 2016 that Mr. Dardick’s
symptoms were related to anxiety and depression, those statements did not refute the
earlier contemporaneous medical treatment notes stating that Mr. Dardick denied
anxiety and depression, nor did they indicate that Mr. Dardick received treatment.
Therefore, we reject the cherry-picking argument.
Mr. Dardick argues that Unum’s reliance on his lack of medication to treat
depression impermissibly failed to take into account his intolerance to medical
therapies. Ms. Grover documented Mr. Dardick’s intolerance of bupropion.
Mr. Dardick does not claim he tried other medical therapies. Moreover, Dr. Bartlett
discussed the claimed side-effects of Mr. Dardick’s medications, concluding that “the
9 available medical notes do not support that the ongoing medications prescribed are
causing side effects that rise to the level of impairment.” Id. at 914.
Finally, Mr. Dardick challenges Unum’s reliance on its medical reviewers,
Ms. Grover and Dr. Bartlett. He argues that neither of them had the necessary
training or experience in advanced cardiac disease or mental health conditions related
to cardiac disease to offer an opinion. He relies on 29 C.F.R. § 2560.503-1(h)(3)(iii),
which provides that where an adverse benefit decision “is based in whole or in part
on a medical judgment,” the consulting health care professional must have
“appropriate training and experience in the field of medicine involved in the medical
judgment.” We agree with the district court that “Unum did not make a medical
judgment as to whether [Mr. Dardick] suffered from coronary artery disease or other
cardiac conditions identified by Dr. Trujillo but rather determined that [his] medical
record failed to establish that [he] was incapable of performing his job despite these
conditions.” Aplt. App. at 1043. Cf. Cooper v. Metro. Life Ins. Co., 862 F.3d 654,
662 (8th Cir. 2017) (collecting cases holding “the proper inquiry in analyzing a claim
administrator’s compliance with § 2560.503-1 is ‘substantial compliance,’ rather than
‘technical compliance’”). Consequently, Unum’s benefits decision was not arbitrary
and capricious due to its reliance on the opinions of Dr. Bartlett and Ms. Grover.
Mr. Dardick asserts that it was improper for Unum to have Ms. Grover review
his file a second time. He relies on 29 C.F.R. § 2560.503-1(h)(3)(v), which states
that a health care professional consulted for the underlying denial of benefits shall
not be the same individual consulted for the appeal from that denial. But it was not
10 Ms. Grover, but Kim Walker, R.N., who initially reviewed the medical records, and it
was Ms. Walker’s review on which Unum relied to deny benefits initially. Moreover,
even if having Ms. Grover review the file twice was irregular, we agree with the
district court that having Dr. Bartlett also review the medical evidence for the second
appeal cured any irregularity.
B. Characterization of Occupation
Mr. Dardick alleges that Unum mischaracterized the nature of his work as a
vice president for Westcon, which was a procedural irregularity demonstrating
arbitrariness. The Plan provided that an employee’s occupation would be viewed “as
it is normally performed in the national economy, instead of how the work tasks are
performed for a specific employer or at a specific location.” Aplt. App. at 355-56.
Unum initially characterized Mr. Dardick’s position as Systems Project
Manager, a sedentary position. During the first appeal, Mr. Byard determined that
Mr. Dardick’s position was more consistent with a Cloud Solution Manager.
Mr. Byard acknowledged Mr. Dardick’s report that “his occupation includes travel all
over the country and long work hours,” id. at 409, which was considered “to be a job
specific requirement . . . and not necessarily representative of the manner in which
the overall occupation is performed throughout the national economy,” id. at 411. As
normally performed, this position contemplated “an occasional level of local business
related travel [and] ongoing work hours in excess of a standard 40 hour work week.”
Id.
11 During the second appeal, Mr. Byard again revised his assessment of
Mr. Dardick’s position, finding his duties to be more consistent with the combined
position of Vice President of Product Development and Vice President of Marketing.
Addressing the travel requirements of this position, Mr. Byard again determined that
as normally performed, the position required “an occasional level of local/regional
business related travel.” Id. at 899. And again, “work hours in excess of a standard
40 hour work week” were to be expected. Id.
Mr. Dardick maintains that Unum did not in good faith adjust its assessment of
his occupation as it received additional information. Rather, he argues that Unum
knew his job title from the beginning. But he cites to various documents that
demonstrate an evolving picture of his occupation. See Reply Br. at 16. For
example, his initial application submitted in August 2015 described his occupation
only as “VP, Westcon Cloud Services.” Aplt. App. at 48. Much later, on August 17,
2016, his former supervisor provided an extensive description of his work, id. at
862-65, which Mr. Byard relied on to revise his assessment of Mr. Dardick’s
occupational duties. Thus, we conclude that Unum’s consideration of additional
evidence to modify Mr. Dardick’s job description did not demonstrate bad faith.
Although Mr. Dardick emphasizes that as he performed it, his position was
very stressful and required extensive travel, he does not challenge either the Plan
language providing that his occupation would be viewed as it is normally performed
in the national economy or that the normal occupational requirements did not include
excessive stress or extensive business travel. Mr. Dardick’s citation to Unum’s
12 claims manual directing that various job requirements, including travel, be
considered when evaluating an employee’s position does not nullify the overall Plan
provision that an employee’s position be viewed as it is normally performed in the
national economy. For example, in evaluating the demands of the positions he
identified for Mr. Dardick, Mr. Byard did consider the travel demands for those
positions. Therefore, we conclude that Unum’s assessment of Mr. Dardick’s
occupation was not arbitrary and capricious.
V. CONCLUSION
We affirm the district court’s judgment.
Entered for the Court
Allison H. Eid Circuit Judge