Salomaa v. Honda Long Term Disability Plan
642 F.3d 666
9th Cir.2011Background
- Salomaa worked for Honda for over twenty years and developed chronic fatigue syndrome with severe cognitive symptoms.
- Honda's ERISA plan denied Salomaa long-term disability benefits in 2005 after a file review and objections from Salomaa's physicians.
- Salomaa sued in district court; the court applied abuse-of-discretion review considering the plan's conflict of interest and upheld denial.
- The Ninth Circuit panel amended its opinion to clarify the standard of review in light of the plan's structural conflict of interest.
- The majority held the plan abused its discretion and reversed and remanded with instructions to award benefits; Judge Hall dissented.
- Key factual disputes centered on the lack of objective testing for CFS, the weight given to self-reports, and the Social Security disability award.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standard of review with conflict | Salomaa contends deference should be reduced due to conflict. | Honda argues abuse-of-discretion review remains appropriate with some skepticism. | Conflict weighed as a factor in abuse-of-discretion review. |
| Reasonableness of denial under conflict | The denial was reasonable given medical evidence and lack of objective tests. | Plan's reasons were consistent with medical reviews and exclusions based on objective findings. | Plan denial was unreasonable and arbitrary under the circumstances. |
| Consideration of Social Security award | SSA award evidence should have been considered in evaluating disability. | SSA awards are not binding and may be given limited weight. | Failure to address SSA award supports a finding of abuse of discretion. |
| Meaningful dialogue and disclosure | Plan failed to engage in meaningful dialogue and to disclose medical opinions relied upon. | Letters and responses in the denial process were adequate communications. | Procedural failures undermined the review and supported abuse of discretion. |
Key Cases Cited
- Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (Supreme Court 1989) (established deferential abuse-of-discretion standard for ERISA plans with discretion)
- Metropolitan Life Insurance Co. v. Glenn, 128 S. Ct. 2343 (U.S. Supreme Court 2008) (conflict of interest weighs as a factor in determining abuse of discretion)
- Abatie v. Alta Health & Life Insurance Co., 458 F.3d 955 (9th Cir. 2006) (conflict of interest must be weighed when administrator is conflicted)
- Saffon v. Wells Fargo & Co. Long Term Disability Plan, 522 F.3d 863 (9th Cir. 2008) (weight of conflict depends on factors; promote skeptical review)
- Booton v. Lockheed Med. Ben. Plan, 110 F.3d 1461 (9th Cir. 1997) (meaningful dialogue requirement and procedural adequacy)
- Friedrich v. Intel Corp., 181 F.3d 1105 (9th Cir. 1999) (diagnosis by exclusion and lack of objective tests for CFS)
- Jordan v. Northrop Grumman Corp. Welfare Benefit Plan, 370 F.3d 869 (9th Cir. 2004) (early articulation of abuse-of-discretion standards in ERISA cases)