Nichols v. Reliance Standard Life Ins. Co.
924 F.3d 802
5th Cir.2019Background
- Juanita Nichols, a HACCP Coordinator at a poultry plant, stopped work claiming Raynaud's from cold exposure and applied for ERISA-governed long-term disability (LTD) benefits.
- The LTD plan defines "Totally Disabled" as inability to perform the material duties of the insured's "Regular Occupation," which is assessed as the occupation "as it is normally performed in the national economy."
- Reliance used DOT-based vocational reviews to classify Nichols' regular occupation as "Sanitarian (Any Industry)," whose DOT entry does not list routine cold exposure as a material duty; Reliance denied benefits.
- Nichols appealed administratively and then sued under 29 U.S.C. § 1132(a)(1)(B), arguing her HACCP Coordinator duties (inspection/packaging in poultry plants) necessarily require work in cold environments and thus she is totally disabled.
- The district court reversed Reliance, adopting a different DOT title ("Cooler Room Worker (Meat Products)") sua sponte and also relied on an extensive, sua sponte review of many prior decisions criticizing Reliance to give weight to a structural conflict of interest.
- On appeal the Fifth Circuit reviewed de novo the summary judgment disposition but applied abuse-of-discretion review to Reliance’s benefits denial (plan delegates discretionary authority) and reversed the district court, entering judgment for Reliance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper definition of "Regular Occupation" and use of DOT | Nichols: Administrator must account for her employer-specific duties (inspection/packaging in cold) when defining regular occupation. | Reliance: Regular occupation is a general-occupation inquiry; DOT entries in the record may be used; employer-specific duties need not control. | Held: "Regular Occupation" is a general-occupation inquiry; Reliance reasonably used the DOT sanitarian entry in the record. |
| Whether Reliance abused discretion / substantial evidence supports denial | Nichols: Reliance ignored evidence that cold exposure was a material duty and relied narrowly on DOT. | Reliance: Vocational reports comparing Peco job description to DOT sanitarian entry provide substantial evidence. | Held: Reliance’s decision was supported by substantial evidence and not arbitrary. |
| Use of alternative DOT entries not in record | Nichols: District court correctly could adopt a different DOT entry (Cooler Room Worker) that better fits her duties. | Reliance: Administrator’s factual finding is constrained to the administrative record; court cannot rely on DOT entries outside the record. | Held: District court erred to rely on a DOT entry not in the administrative record; Robinson forbids introducing outside DOT entries at review. |
| Significance of insurer–administrator conflict of interest | Nichols/District Ct: Reliance’s long history of criticized decisions makes the structural conflict highly significant. | Reliance: No evidence the conflict affected this decision; conflict is a minimal factor when claimant offers no proof it influenced outcome. | Held: Because Nichols offered no evidence the conflict influenced the denial, the structural conflict was a minimal factor and did not overcome substantial evidence supporting Reliance. |
Key Cases Cited
- Glenn v. Metropolitan Life Insurance Co., 554 U.S. 105 (2008) (structural conflict is a factor in abuse-of-discretion review)
- House v. American United Life Insurance Co., 499 F.3d 443 (5th Cir. 2007) ("regular occupation" is a general-occupation inquiry)
- Pylant v. Hartford Life & Accident Insurance Co., 497 F.3d 536 (5th Cir. 2007) (administrator may reasonably use DOT to define occupation; need not account for every specific duty)
- Robinson v. Aetna Life Insurance Co., 443 F.3d 389 (5th Cir. 2006) (DOT entries are evidence in the administrative record; court should not rely on DOT material outside the administrative record)
- Holland v. International Paper Co. Retirement Plan, 576 F.3d 240 (5th Cir. 2009) (abuse of discretion occurs when denial lacks evidentiary support)
- Truitt v. Unum Life Insurance Co. of America, 729 F.3d 497 (5th Cir. 2013) (weight of structural conflict depends on circumstances; substantial evidence can outweigh conflict)
- Anderson v. Cytec Industries, Inc., 619 F.3d 505 (5th Cir. 2010) (if claimant adduces no evidence the conflict affected decision, conflict is not a significant factor)