988 F.3d 1217
10th Cir.2021Background
- Carlile worked for Lighthouse Resources (LRI) under a 90‑day termination notice; LRI issued notice March 21, 2016, paid the notice period in a lump sum (Mar. 31) and continued paying insurance premiums.
- LRI told Reliance Carlile’s last day worked was June 7, 2016; Carlile testified he came into the office during the notice period and LRI reimbursed travel for conferences in April–May.
- Carlile was diagnosed with prostate cancer May 31, 2016, stopped work June 7, 2016, received short‑term disability and applied for long‑term disability (LTD) in Oct. 2016.
- Reliance denied LTD in Feb. 2017, concluding Carlile ceased to be an “active, Full‑time Employee” as of March 30, 2016 because he was not working a minimum of 30 hours per week; Reliance conceded he was “Totally Disabled” as of June 9, 2016.
- District court held the Plan’s undefined term “active” ambiguous, construed it for Carlile (meaning “current employee”), found him eligible but made no determination on benefit amount/duration, and awarded attorney fees.
- Tenth Circuit affirmed: construed ambiguity against Reliance, denied remand, and upheld attorney‑fee award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Meaning of “active” in eligibility phrase "active, Full‑time Employee" | Carlile: "active" means current employee/status; not limited to actually working a given week | Reliance: "active" means actually working (i.e., performing work) and combined with "Full‑time" requires ≥30 hours/week | Term "active" is ambiguous; construed against insurer to mean a current employee (Carlile was eligible) |
| Whether coverage terminated during 90‑day notice paid in lump sum | Carlile: coverage continues until termination is effective; prior pay/continued premiums and work pattern support expectation of coverage | Reliance: notice and lack of evidence of 30 hours/week show coverage ended March 30, 2016 | Court: reasonable employee would expect coverage to continue during notice period; Carlile remained "Full‑time" and "active" |
| Whether case should be remanded to administrator to decide disability/duration | Carlile: Reliance already conceded total disability as of June 9; remand unnecessary | Reliance: remand needed to evaluate disability/duration and calculate benefits | Remand denied: record shows entitlement to benefits; Reliance had conceded disability and district court made no award of amounts/duration |
| Award of attorney fees under 29 U.S.C. § 1132(g) | Carlile: prevailed on eligibility so entitled to fees | Reliance: no success on merits if not eligible, so fees improper | Fee award affirmed as within district court’s discretion because Carlile achieved success on the merits |
Key Cases Cited
- Miller v. Monumental Life Ins. Co., 502 F.3d 1245 (10th Cir. 2007) (framework for plan interpretation and resolving ambiguities against drafter)
- Weber v. GE Grp. Life Assurance Co., 541 F.3d 1002 (10th Cir. 2008) (remand/award analysis and reasoning about a regular work week)
- Tester v. Reliance Standard Life Ins. Co., 228 F.3d 372 (4th Cir. 2000) (construing ambiguous “active” in favor of insured where policy gave no criteria)
- LaAsmar v. Phelps Dodge Corp. Life, Accidental Death & Dismemberment & Dependent Life Ins. Plan, 605 F.3d 789 (10th Cir. 2010) (summary‑judgment review standards in ERISA benefit cases)
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (U.S. 1989) (standard of review for ERISA benefit denials absent plan discretion)
- Pakovich v. Broadspire Servs., Inc., 535 F.3d 601 (7th Cir. 2008) (limitations on remand when administrator’s rationale would be internally inconsistent)