Sellers v. Zurich American Insurance
627 F.3d 627
7th Cir.2010Background
- ERISA AD&D policy in Time Warner’s employee welfare plan covers deaths within 365 days of an accident.
- Sellers injured knee Sept 15, 2005; a wire was surgically implanted Sept 29, 2005 to aid healing.
- Wire later broke; Nov 16, 2006 surgery to remove the broken wire.
- Sellers died Nov 25, 2006 from acute pulmonary embolism due to immobilization after wire removal.
- Zurich denied the claim, relying on the 365-day bar and that wire breakage was not an accident.
- District court remanded for new determination; on reconsideration Zurich again denied; plaintiffs appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the wire breakage was an accident under the policy. | Sellers argues Senkier compels treating related surgical complications as accidents. | Zurich contends wire breakage is an expected medical-treatment complication, not an accident. | Not an accident under the plan; still precluded by 365-day bar. |
| Whether Senkier governs whether deaths from medical treatment injuries are accidents. | Senkier supports treating death from accident-related treatment as accidental. | Senkier applies to standard complications of medical treatment; wires breaks are such complications. | Senkier applies; wire break is a medical-treatment complication and not an accident. |
| What is the proper standard of review given plan discretion and the basis of Zurich’s denial. | Arbitrary and capricious review should apply to Zurich’s interpretation of 'accident.' | Discretionary authority supports arbitrary and capricious review of denial based on plan interpretation. | Because of plan discretion and reliance on plan interpretation, arbitrary and capricious review applies. |
| Can death within 365 days be traced to an accident given the timing of the initial injury? | If traceable to the Sept 2005 injury, within 365 days of death. | Break occurred in 2006, and under Senkier such injuries from medical treatment aren’t accidents. | Even if traceable, the injury is a medical-treatment complication and not an accident; barred by 365-day requirement. |
Key Cases Cited
- Senkier v. Hartford Life & Accident Ins. Co., 948 F.2d 1050 (7th Cir.1991) (injuries from medical treatment are not accidents under AD&D policies)
- Senkier v. Hartford Life & Accident Ins. Co., 948 F.2d 1050 (7th Cir.1991) (standard complications of treatment not accidents; cause is underlying illness or injury)
- Davis v. Unum Life Ins. Co. of Am., 444 F.3d 569 (7th Cir.2006) (plan terms interpreted under ERISA with common-sense understanding)
- Swaback v. American Information Technologies Corp., 103 F.3d 535 (7th Cir.1996) (ERISA plan terms construed to reflect ordinary meaning of terms)
- Cozzie v. Metropolitan Life Ins. Co., 140 F.3d 1104 (7th Cir.1998) (accident meaning assessed by common understanding, not expert viewpoint)