Gonzales v. Unum Life Insurance Co. of America
861 F. Supp. 2d 1099
S.D. Cal.2012Background
- Cross-motions for summary judgment address the proper standard of review under ERISA for Gonzales’ disability claims.
- Court must determine standard of review for two policies: short-term disability (STD) uses de novo review; long-term disability (LTD) uses abuse of discretion review.
- Gonzales worked for Starwood Hotels; LTD benefits would have been $21,078.28 monthly for 18 months if paid.
- Unum issued the LTD policy; Starwood SPD and Unum policy are the plan documents relevant to the LTD decision.
- Gonzales’ treating physicians diagnosed Parkinson’s disease; Unum denied LTD benefits after a long, multi-year review.
- SPD and the Unum LTD policy are analyzed together to determine whether discretion is granted to administer the plan and how review should proceed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the plan documents grant discretionary authority to interpret benefits. | SPD controls; no explicit grant of discretion by policy. | Insurance policy unambiguously grants discretion to administrator. | Plan documents grant discretion; abuse of discretion standard applies to LTD. |
| What standard of review governs LTD denial. | de novo review should apply to LTD denial. | abuse of discretion applies due to discretionary language. | Abuse of discretion applies to LTD; de novo for STD. |
| Whether Unum forfeited discretionary review by its handling of Dr. Stotland’s report. | Procedural mishandling negates discretion; de novo review. | One-level appeal with courtesy consideration; no forfeiture. | Procedural issues do not compel de novo review; discretion remains. |
| What factors modify the extent of deferential review in the abuse of discretion standard. | Consider plan administrator’s conflict of interest and other factors. | Conflict, paper review, and access issues may temper deference under abuse of discretion. |
Key Cases Cited
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (U.S. 1989) (establishes default de novo review unless discretionary authority exists)
- Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955 (9th Cir. 2006) (en banc; deference depends on existence of discretion and procedural compliance)
- Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666 (9th Cir. 2011) (conflicts of interest are factors in abuse of discretion review)
- Montour v. Hartford Life & Accident Co., 588 F.3d 623 (9th Cir. 2009) (examines insurer’s reliance on paper reviews and related factors)
- Gatti v. Reliance Std. Life Ins. Co., 415 F.3d 978 (9th Cir. 2005) (illustrates analysis of discretionary review and plan documents)