Karen McClain v. Eaton Corp. Disability Plan
740 F.3d 1059
| 6th Cir. | 2014Background
- Karen McClain received long-term disability (LTD) benefits under Eaton’s Plan; after 24 months the Plan’s definition shifted from an “own-occupation” to an “any-occupation” standard.
- Treating physicians (Drs. Boehm and Frauwirth) limited McClain to sedentary work and, according to Frauwirth, part-time hours only.
- The insurer obtained a Transferable Skills Assessment and Labor Market Survey identifying local sedentary, part-time positions within McClain’s restrictions.
- Independent reviewers (neurological and orthopedic surgeons) concluded McClain could perform sedentary work and did not endorse the part-time-only restriction; one even concluded she could return to full duty.
- The Plan Administrator denied continued LTD benefits under the “any occupation” standard; McClain exhausted appeals and sued under ERISA. The district court upheld the administrator; this court affirms.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the administrator acted arbitrarily in finding McClain not disabled under the Plan’s “any occupation” standard | McClain: Dr. Frauwirth limited her to part-time work; insurer cannot ignore that limit or rely on post-hoc rationalizations | Administrator: Record supports that McClain can perform sedentary occupations (part- or full-time); ability to do some work precludes "any occupation" disability | Held: Not arbitrary or capricious—administrator’s decision rational and supported by record |
| Whether reliance on jobs that pay low wages is impermissible under "any occupation" language | McClain: Part-time wages would be a "pittance" and frustrate the purpose of her 70% wage-replacement plan; VanderKlock/Helms framework requires "gainful" employment | Administrator: Ability to perform some work (even part-time) reasonably shows not totally unable to perform any occupation; consistent with other circuits | Held: Under deferential review, rational to conclude ability to do some work means not unable to do "any work" |
| Whether insurer impermissibly changed its rationale during review (post-hoc rationalization) | McClain: Insurer shifted bases and effectively rejected Frauwirth’s part-time restriction without giving chance to respond | Administrator: Consistently denied for failure to meet disability definition and allowed submission of further records; independent reviewers contacted treating docs | Held: No improper "about-face"; insurer consistently denied for same overarching reason and relied on administrative record |
Key Cases Cited
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989) (standards for judicial review of ERISA benefit denials)
- Wilkins v. Baptist Healthcare Sys., Inc., 150 F.3d 609 (6th Cir.) (courts limited to evidence before administrator at time of decision)
- Marks v. Newcourt Credit Group, Inc., 342 F.3d 444 (6th Cir.) (arbitrary-and-capricious review where plan gives discretion)
- Schwalm v. Guardian Life Ins. Co. of America, 626 F.3d 299 (6th Cir.) (administrator decision upheld if based on reasoned explanation and substantial evidence)
- VanderKlock v. Provident Life & Accident Ins. Co., 956 F.2d 610 (6th Cir.) (discussing that nominal or pittance employment may not defeat "total disability")
- Cozzie v. Metropolitan Life Ins. Co., 140 F.3d 1104 (7th Cir.) (describing extreme deference of arbitrary-and-capricious review)