Reynolds v. New York Life Insurance Company

District Court, W.D. Washington·Decided December 18, 2023·No. 2:21-cv-01424·Unknown

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE LUCY REYNOLDS, Plaintiff, v. C21-1424 TSZ NORTH AMERICA, Defendant.

THIS MATTER comes before the Court on Plaintiff Lucy Reynolds’ motion for prejudgment interest and attorney’s fees, docket no. 82, and Plaintiff’s motion to amend judgment, docket no. 84. Having reviewed all papers filed in support of, and in opposition to, the motions, the Court enters the following order. Background The Court has detailed the background of this case in a previous Order. See Order (docket no. 80). Plaintiff worked for Affymetrix until November 20, 2015. AR 274, 325, & 1872. During Plaintiff’s employment, Affymetrix was a participant in an employee benefit plan (the “Policy”) issued by Defendant Life Insurance Company of New York (“LINA”). AR 1–28. The Policy is governed by the Employee Retirement Income Security Act of 1974 (“ERISA”) and provides for both short term disability (“STD”) and long term disability (“LTD”) benefits. Id. The Policy states in relevant part: Definition of Covered Earnings Covered Earnings means an Employee’s base annual salary or estimated annual earnings based on a standard hourly rate, multiplied by 2080, as reported by the Employer for any work performed for the Employer as in effect just prior to the date Disability begins. It includes amounts received as commissions, piece work, fee based and for ordained, commissioned or licensed ministers only, any housing allowance paid by the Employer to the Employee, whether or not such allowance is subject to federal or state income tax, but not bonuses, overtime pay, special pay or any other form of extra compensation. A Leave of Absence Employee’s Covered Earnings will be his rate in effect prior to going on a Leave of Absence.

AR 6. On or around October 7, 2019, Plaintiff initiated a claim for disability benefits with LINA. AR 83–97. LINA eventually approved Plaintiff’s claim for STD benefits and issued to Plaintiff a check in the amount of $20,016.00. AR 100, 263–65, 274, 276, 278–79, 286, 295–96, & 308. LINA, however, denied Plaintiff’s claim for LTD benefits. AR 5976–81, 997–1001, 1093–96, & 1113–17. Plaintiff then initiated this case, which eventually came before the Court on cross-motions under Federal Rule of Civil Procedure 52, docket nos. 69 & 70. The Court entered an Order, docket no. 80, and a Judgment, docket no. 81, in favor of Plaintiff. Plaintiff then filed the pending motions. Discussion A. Plaintiff’s Motion to Amend Judgment Plaintiff brings her motion to amend judgment under Federal Rule of Civil Procedure 59(e). Pl.’s Mot. at 2 (docket no. 84). Although “a rule 59(e) motion is an ‘extraordinary remedy, to be used sparingly in the interests of finality and conservation of judicial resources[,]’” Wood v. Ryan, 759 F.3d 1117, 1121 (9th Cir. 2014) (citation omitted), the Court “has considerable discretion when considering a motion to amend a judgment under Rule 59(e), Turner v. Burlington N. Santa Fe R.R. Co., 338 F.3d 1058, 1063 (9th Cir. 2003) (citations omitted). A Rule 59(e) motion may be granted if (1) “the

motion is ‘necessary to correct manifest errors of law or fact upon which the judgment is based;’” (2) “the moving party presents ‘newly discovered or previously unavailable evidence;’” (3) “the motion is necessary to ‘prevent manifest injustice;’” or (4) “there is an ‘intervening change in controlling law.’” Turner, 338 F.3d at 1063 (citation and emphasis omitted). The Court exercises its discretion to address Plaintiff’s claims regarding STD and LTD benefits.

1. STD Benefits Plaintiff seeks an Amended Order clarifying that her STD benefits are to “be calculated based on her 2015 annual salary which represents her ‘Covered Earnings’ as defined by the policy.” Pl.’s Mot. at 3 (docket no. 84). Specifically, Plaintiff maintains that her “Covered Earnings” totaled $104,524, and thus LINA underpaid her STD

benefits claim. Id. at 5. As LINA points out, however, Plaintiff did not challenge the calculation of her STD benefits during the administrative process or during this litigation. Def.’s Resp. at 3–4 (docket no. 88). Plaintiff does not dispute that she did not challenge the calculation of her STD benefits. See Pl.’s Reply (docket no. 91). Instead, Plaintiff cites to the Court’s Order, docket no. 80, where the Court stated that “Plaintiff’s claim for

STD benefits is relevant because the Policy’s standard to receive STD benefits is the same as the standard for the first 24 months of LTD benefits.” Pl.’s Reply at 3. The Court’s Order, however, related to approving, and not calculating, Plaintiff’s claim for benefits. Thus, Plaintiff raises a new argument for the first time, and the Court declines to enter an amended judgment with respect to Plaintiff’s claim for STD benefits. See Carroll v. Nakatani, 342 F.3d 934, 945 (9th Cir. 2003) (“A Rule 59(e) motion may not be

used to raise arguments or present evidence for the first time when they could reasonably have been raised earlier in the litigation.” (citing Kona Enters., Inc. v. Estate of Bishop, 229 F.3d 877, 890 (9th Cir. 2000))). 2. LTD Benefits Plaintiff also seeks an amended judgment clarifying that her LTD benefits should be calculated based on her 2015 annual salary, which represents her Covered Earnings

pursuant to the Policy. Pl.’s Mot. at 3 (docket no. 84). Specifically, Plaintiff maintains that her LTD benefits should be calculated based on a rate of 60% of her $104,524 Covered Earnings. Id. at 4–5. In support of her argument, Plaintiff provides her 2015 W-2 Form and her 2015 IRS 1040 Wage Statement. Reynolds Decl. (docket no. 85); W-2 Form (docket no. 85-1); IRS 1040 Wage Statement (docket no. 85-2).1 LINA

argues that “Plaintiff has failed to demonstrate (1) that all of her taxable income in 2015 originated from her employment at Affymetrix; (2) that the higher figure she advocates for consists solely of her base annual salary (as opposed to bonuses, overtime, or other taxable benefits); and (3) that her employer reported that figure to LINA.”2 Def.’s Resp. at 6 (docket no. 88).

1 Plaintiff also maintains that the $104,524 earnings is consistent with the certified earnings reported by the Social Security Administration. Pl.’s Mot. at 4 (docket no. 84) (citing AR 1952). 2 LINA also argues that “Plaintiff appears to be seeking . . . an advisory opinion” and points out that “Plaintiff never raised the issue of the calculation of her benefits at any point during the course of this According to the Policy, Plaintiff’s “Covered Earnings” are her “base annual salary or estimated annual earnings based on a standard hourly rate, multiplied by 2080,

as reported by the Employer” to LINA. AR 6. Plaintiff’s “Covered Earnings,” however, do not include “bonuses, overtime pay, special pay or any other form of extra compensation.” Id. Although it appears Plaintiff’s taxable income in 2015 totaled $104,524, Plaintiff has not established that the $104,524 was solely from her employment with Affymetrix or that the $104,524 was her base salary without “bonuses, overtime pay, special pay or any other form of extra compensation.” Because the record does not

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