(PS) Clay v. AT&T Umbrella Benefit Plan No. 3

District Court, E.D. California·Decided November 1, 2019·No. 2:17-cv-00749·Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 JEROME A. CLAY, No. 2:17-cv-00749-KJM-KJN PS 12 Plaintiff, FINDINGS AND RECOMMENDATIONS REGARDING SUMMARY JUDGMENT 13 v. (ECF Nos. 71) 14 AT&T UMBRELLA BENEFIT PLAN NO. 3, 15 Defendant. 16 17 This case arises from Defendant’s alleged improper denial of short term disability 18 benefits, as governed by the Employee Retirement Income Security Act. The following causes of 19 action survived multiple rounds of motions to dismiss and amendments to the pleadings: 20 (I) failure to provide Plaintiff benefits under 29 U.S.C. § 1132(a)(1)(B), a “full and fair review” 21 of his claim for benefits, or “the true reasons and documentation supporting [its] denial of his 22 claim” under 29 U.S.C. § 1133; and (II) failure to provide Plaintiff with information about his 23 benefits, under 29 U.S.C. § 1132(c)(1)(B). Plaintiff also generally alleges that “Defendant[ ] 24 acted under a conflict of interest in denying [his] claim.” 25 Defendant has moved for summary judgment, and Plaintiff opposed. (ECF Nos. 71, 74.) 26 After carefully considering the written briefing, the record, and the applicable law, the Court 27 recommends Defendant’s motion for summary judgment be GRANTED. 28 /// 1 Factual Background 2 A. Plaintiff’s Insurance Plan 3 Plaintiff works as a splicing technician for Pacific Bell Telephone Company. (ECF No. 4 71-2, Defendant’s Statement of Undisputed Facts, at ¶ 1.) His employer–sponsored insurance 5 includes eligibility for the AT&T West Disability Benefits Program. (Id. at ¶ 3.) This Disability 6 Program offers short term disability (“STD”) benefits to disabled employees whose injury 7 precludes them “from engaging in [their] normal occupation or employment.” (Id. at ¶ 7.) It is 8 self-funded by the AT&T Voluntary Employee Beneficiary Association Trust. (Id. at ¶ 6; see 9 also 71-4 (AR) at p. 84, the “Summary Plan Description.”) The Disability Program grants 10 Defendant the authority to “determine the rights and status of [participants, and] the eligibility of 11 any individual” to receive benefits under the plan’s various programs. (ECF No. 71–2 at ¶ 4.) 12 Defendant has delegated this authority to its Plan Administrator, who in turn has delegated its 13 authority to determine benefits claims and appeals to a claims administrator: Sedgwick Claims 14 Management Services Center, Inc. (Id. at ¶ 5.) Sedgwick operates the AT&T Integrated 15 Disability Service Center, which processes STD claims.1 (Id. at ¶¶ 5, 14.) 16 To properly demonstrate disability, participants must see a physician, “follow a treatment 17 plan that is reasonably designed” to help them recover, and “periodically furnish satisfactory 18 Medical Evidence of [their] disability from [their] physician.” (AR 61.) The medical evidence 19 must consist of “[o]bjective medical information sufficient to show that the Participant is 20 Disabled . . . [such as] results from diagnostic tools and examinations performed in accordance 21 with the generally accepted principles of the health care profession.” (AR 81.) Further, the 22 Disability Program asks participants to “[e]nsure that [their] medical providers cooperate with the 23 Claims Administrator to provide” it with “all necessary information . . . in a timely manner.” (AR 24 61.) Sedgwick may discontinue benefits if the participant does not provide it with “objective 25 Medical Evidence for [his] condition.” (AR 67.) It is within the sole discretion of Sedgwick “or 26 its delegates” to determine whether a participant is qualified to received STD benefits. (AR 62.) 27 1 For the sake of simplicity, the Court will refer to both entities (Sedgwick Claims Management 28 Services Center and AT&T Integrated Disability Service Center) as “Sedgwick.” 1 B. Plaintiff’s Disability Claims 2 Plaintiff underwent surgery on his right knee on December 7, 2016. (ECF No. 71–2 at 3 ¶ 13.) On December 16, 2016, Plaintiff applied for STD benefits; Sedgwick approved his claim 4 for a period of disability extending until January 29, 2017. (Id. at ¶ 15.) On January 30, 2017, 5 this period was extended through March 9, 2017. (Id. at ¶ 16.) Thereafter, Sedgwick contacted 6 Plaintiff to explain that it needed more medical documentation to further extend Plaintiff’s STD 7 benefits. (Id. at ¶¶ 16–17.) After some delay on Plaintiff’s part, his physician informed 8 Sedgwick that Plaintiff was scheduled for an upcoming appointment; Sedgwick further extended 9 Plaintiff’s benefits through March 15. (Id. at ¶¶ 18–19.) Sedgwick advised Plaintiff multiple 10 times of his ongoing responsibility to provide it with updated medical records should he wish to 11 assert his eligibility for STD benefits. (Id. at ¶¶ 15, 16, 18, 19, 21, 23.) 12 In March 2017, Plaintiff’s physician informed Sedgwick that Plaintiff’s knee exam was 13 “fairly normal,” and that Plaintiff could return to work in April. (Id. at ¶ 20, 22.) Sedgwick 14 discontinued Plaintiff’s STD benefits, but this decision was overturned on appeal; Sedgwick then 15 granted Plaintiff an extension through June 11, 2017. (Id. at ¶¶ 24–28.) In the summer of 2017, 16 Sedgwick reviewed Plaintiff’s file, and found Plaintiff had not submitted any updated medical 17 records after March 31. (Id. at ¶¶ 29–31.) When Sedgwick contacted both Plaintiff’s physician 18 and physical therapist, it learned that Plaintiff was not scheduled for any upcoming medical 19 appointments. (Id. at ¶ 31.) On July 26, Sedgwick sent Plaintiff a letter explaining that it denied 20 his request to extend STD benefits because it did not receive medical documentation 21 demonstrating ongoing disability. (Id. at ¶ 32.) The letter quoted the Disability Program’s 22 participant guide, which detailed claimants’ duties to “periodically furnish satisfactory medical 23 evidence of your disability from your physician,” and outlined the appeal process. (AR 333–34.) 24 Plaintiff appealed, but did not furnish updated medical records. (ECF No. 71–2 at ¶ 34.) 25 Sedgwick subsequently contacted Plaintiff asking for the records, but he “stated that the medical 26 information in the file was complete and that he had nothing else to provide.” (Id. at ¶ 35.) 27 Sedgwick then referred Plaintiff’s case to an independent physician advisor. (Id. at ¶ 36.) The 28 physician advisor, a board-certified orthopedic surgeon, attempted to contact Plaintiff’s physician 1 on multiple occasions, but never reached him. (Id. at ¶ 37.) After reviewing the medical records 2 that were on file for Plaintiff, the physician advisor determined that there was insufficient medical 3 evidence to establish that Plaintiff was disabled after June 11, 2017. (Id. at ¶ 38.) Thereafter, 4 Sedgwick upheld its previous decision based on the physician advisor’s analysis and the lack of 5 updated medical records concerning Plaintiff’s alleged disability. (Id. at ¶ 39.) 6 Plaintiff returned to work without any restrictions on August 14, 2017. (Id. at ¶ 33.) 7 Procedural History 8 On April 7, 2017, Plaintiff, proceeding without counsel, filed a complaint against 9 Defendant challenging the denial of his STD benefits.2 (ECF No. 1.) Plaintiff’s most recent 10 (third amended) complaint alleged thirteen causes of action; however, only the first, third, and 11 fourth causes of action remain. (See ECF No. 52 at 10:20–25.) In Plaintiff’s first cause of action, 12 he seeks recovery of STD benefits pursuant to 29 U.S.C. § 1132(a)(1)(B). (ECF No. 43 at 11:26.) 13 His third cause of action alleges that Defendant violated 29 U.S.C.

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(PS) Clay v. AT&T Umbrella Benefit Plan No. 3, (E.D. Cal. 2019).

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