SARA LIOI, District Judge.
This matter is before the Court on cross-motions for judgment on the administrative record filed by plaintiff Nicole Cultrona
Nationwide Life provided an accidental death and dismemberment ("AD & D") benefit under the Plan's Group Accident Insurance Policy No. 0014234-30 (the "Policy"). (First Am. Compl. [ECF No. 17] ¶ 11; Answers ¶ 11; Admin. Rec. [ECF No. 19] at 262.
Under the Policy, a benefit is payable in the event that an insured suffers an "Injury" because of an "Accident." (Id. at 269-70.) The Policy defines an "Injury" as "bodily injury caused by the direct result of an Accident occurring while a Covered Person's coverage is in effect under this Policy which results independently of all other causes in a covered loss." (Id. at 265.) An "Accident" is defined as "an unintended or unforeseeable event or occurrence which happens suddenly and violently." (Id. at 264.) Where an Injury results in loss of life within 365 days of an Accident, the benefit paid is 100% of the insurance amount. (Id. at 270.)
Section X of the Plan provides a list of exclusions under which the AD & D benefit will not be paid. Prior to January 1, 2010, Exclusion 12 provided that no benefit was payable for injury or death occurring where "[t]he Covered Person being deemed and presumed, under the law of the locale in which the Injury is sustained, to be driving or operating a motor vehicle while under the influence of alcohol or intoxicating liquors." (Id. at 279.) Effective January 1, 2010, Exclusion 12 was amended to remove the language pertaining to driving or operating a motor vehicle, now excluding payment of a benefit where "[t]he Covered Person being deemed and presumed, under the law of the locale in
On May 1, 2010, Mrs. Cultrona, an employee of a Nationwide affiliate, became eligible to participate in the Plan and elected to do so. (Am. Compl. and Answers ¶¶ 12-13.) As Mrs. Cultrona's lawful spouse, Shawn Cultrona ("Mr. Cultrona") was a "Covered Person" under the Plan. (Admin. Rec. at 264.) Mrs. Cultrona was the designated beneficiary under Mr. Cultrona's coverage. (First Am. Compl. and Answers ¶ 16.)
On June 5, 2011, a tragic incident occurred at the Cultrona home in Twinsburg, Ohio. At approximately 11:30 a.m. that morning, Mrs. Cultrona entered her home and found Mr. Cultrona lying on the floor of their first-floor bathroom. (Admin. Rec. at 339-40.) Mr. Cultrona was prone on the floor with his neck and chin resting against the edge of the bathtub and his abdomen resting on the floor. (Id. at 340.) Mrs. Cultrona touched Mr. Cultrona, and, feeling that his body was cold, immediately called 911. (Id.)
When paramedics arrived on the scene, they noticed a pool of blood on the floor of the garage next to a car. (Id.) The paramedics assessed Mr. Cultrona's condition, and he was pronounced dead at the scene. (Id.) Later that day, detectives from the Twinsburg Police Department and an investigator from the Summit County Medical Examiner's office arrived and further investigated the home. (Id.)
According to the Twinsburg Police investigative report, Mr. Cultrona spent the evening of June 4, 2011 and the early morning of June 5, 2011 drinking with friends. (Id. at 384, 388-89.) A cousin of Mr. Cultrona's saw him at a bar in the early morning of June 5, 2011, and described Mr. Cultrona as appearing intoxicated, "stumbling and walking into chairs." (Id. at 386.) One of Mr. Cultrona's friends, who had drinks with him in the evening of June 4, 2011, described Mr. Cultrona as an alcoholic. (Id. at 389.) Speaking to police officers at the scene, Mrs. Cultrona stated that Mr. Cultrona "may have gotten drunk and fell down, as he has done in the past." (Id. at 375.)
On June 6, 2011, the Medical Examiner's office performed an autopsy of Mr. Cultrona, issuing a report, signed by Chief Medical Examiner Lisa Kohler, M.D., determining that Mr. Cultrona died of "[a]sphyxia by extreme and restricted position (positional asphyxia). II: Acute ethanol intoxication." (Id. at 342.) The report stated the manner of death as "ACCIDENT: Prolonged and extreme hyperextension of neck and torso while intoxicated." (Id.) The report continued, in more detail:
(Id. at 330.) A toxicology report showed that Mr. Cultrona's blood serum was tested and found to contain 0.220% ethanol by volume. (Id. at 337.)
On June 28, 2011, Mrs. Cultrona submitted an accidental death claim form to defendant StarLine, requesting payment of 100% of the benefit under the Plan, totaling $212,000. (Id. at 429-30.) After receiving Mrs. Cultrona's claim form, StarLine enlisted EMSI Investigative Services ("EMSI") to locate the police report, medical examination, autopsy report, and toxicology report for Mr. Cultrona's death. (Id. at 423.) EMSI found these documents, along with Mr. Cultrona's driving record, and provided them to StarLine. (Id. at 318-404.) StarLine forwarded the documents to Nationwide Life, which concluded, "that we have basis to deny this claim using the alcohol exclusion and/or the fact that the cause of death (positional asphyxia) does not appear to meet the [P]olicy definition of accident or injury." (Id. at 313.) Nationwide Life directed StarLine to draft a denial letter and approved the draft. (Id. at 308-13.)
On October 21, 2011, StarLine sent Mrs. Cultrona the denial letter, which stated that Nationwide Life, upon review of the Policy, Mr. Cultrona's death certificate, and the reports from the Twinsburg Police Department and the Medical Examiner, was denying payment of the benefit based on Exclusion 12. (Id. at 297-99.) In attempting to quote the exclusion, StarLine mistakenly provided the text from the prior version of Exclusion 12, which contained the reference to "driving or operating a motor vehicle while under the influence of alcohol or intoxicating liquors." (Id. at 298.) Mrs. Cultrona's counsel responded to StarLine on November 10, 2011, disputing the finding on the basis that Mr. Cultrona was not driving a motor vehicle when his accident occurred, and therefore Exclusion 12 could not apply. (Id. at 295.) On November 17, 2011, StarLine responded to Mrs. Cultrona's counsel, apologizing for the error, explaining that "[t]he Exclusion cited in our denial letter dated October 21, 2011, was quoted incorrectly," and explaining that Exclusion 12 was amended in January 2010. The letter then quoted the amended language, attaching the amendment itself, and stating that "[b]ased on the amended Exclusion 12 language, Nationwide has determined that the denial shall prevail." (Id. at 290.)
On November 18, 2011, Mrs. Cultrona's counsel responded to StarLine's November 17 letter, providing notice of appeal and asking for:
(Id. at 287.) On November 22, 2011, StarLine responded to Mrs. Cultrona's counsel, confirming receipt of the November 18, 2011 letter, stating that "[a] copy of your letter has been sent to Nationwide and all further correspondence including any information that you specifically requested in your correspondence will come directly from them[,]" and providing Nationwide's contact details. (Id. at 283.) StarLine also forwarded "the complete claim file" to the BAC on December 1, 2011 (Id. at 243), and the BAC received the file December 2, 2011 (Id. at 242). On December 6, 2011, the BAC wrote to Mrs. Cultrona's counsel and indicated that it would render a decision on her appeal within 60 days. (Id. at
On January 19, 2012, the BAC sent Mrs. Cultrona's counsel a letter denying her appeal. (Id. at 236.) The letter stated that the denial was based upon review of the Plan, the Policy, Mrs. Cultrona's appeal letter, and StarLine's claim file, including, but not limited to, correspondence between StarLine and Mrs. Cultrona's counsel, the death certificate, the medical examiner's report, the toxicology report, and the police report. (Id.) Upholding the denial of Mrs. Cultrona's claim under the amended Exclusion 12, the BAC concluded that Mr. Cultrona "was under the influence of alcohol or intoxicating liquors at the time of the accident...." (Id. at 237.)
On February 23, 2012, Mrs. Cultrona brought suit in this Court against the Plan, Nationwide Life, and StarLine. (Compl. [ECF No. 1].) On June 26, 2012, she amended her complaint to add the BAC. (Am.Compl.) In her amended complaint, Mrs. Cultrona asks the Court to overturn defendants' denial of her benefit claim, assess statutory penalties for failure to provide Plan documents upon request, award damages for breach of fiduciary duties, and award attorney's fees.
In Wilkins v. Baptist Healthcare Sys., Inc., the Sixth Circuit developed a framework for district courts to employ in adjudicating an ERISA action:
150 F.3d 609, 619 (6th Cir.1998). See also Moore v. Lafayette Life Ins. Co., 458 F.3d 416, 430 (6th Cir.2006) ("The Wilkins panel foresaw occasions in which the procedural process of gathering all pertinent information may have broken down at the administrative level and directed the courts to permit discovery in those cases.").
Mrs. Cultrona believes that the denial of her claim was arbitrary and capricious for five reasons:
The decision of an ERISA plan administrator to deny benefits is reviewed de novo unless the benefit plan grants the administrator discretionary authority to determine eligibility for benefits or to construe the terms of the plan. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). Where there is a clear grant of discretionary authority to the plan administrator under the terms of the plan, the court applies an "arbitrary and capricious" standard of review to the administrator's decision to deny benefits. Farhner v. United Transp. Union Discipline Income Prot. Program, 645 F.3d 338, 342 (6th Cir.2011) (citing Firestone, 489 U.S. at 115, 109 S.Ct. 948) (internal quotation marks omitted).
Under the arbitrary and capricious standard, a district court must affirm the decision of the administrator if the record evidence establishes a reasonable basis for the decision. Davis v. Ky. Fin. Cos. Ret. Plan, 887 F.2d 689, 693-94 (6th Cir.1989). The court must determine whether the administrator's decision was "the result of a deliberate, principled reasoning process and ... supported by substantial evidence." Baker v. United Mine Workers of Am. Health & Ret. Funds, 929 F.2d 1140, 1144 (6th Cir.1991). A plan administrator's rational interpretation of a plan must be accepted, "even in the face of an equally rational interpretation offered by the participants." Morgan v. SKF USA, Inc., 385 F.3d 989, 992 (6th Cir. 2004). This deference extends to the administrator's interpretation of "ambiguous and general terms" of a plan. Jones v. Metro. Life Ins. Co., 385 F.3d 654, 661 (6th Cir.2004).
The arbitrary and capricious standard of review is not, however, a mere "rubber stamp" of the plan administrator's decision. Id. at 661. "Deferential review is not no review, and deference need not be abject." McDonald v. W.-S. Life Ins. Co., 347 F.3d 161, 172 (6th Cir.2003) (internal quotation omitted). A district court must "review ... the quality and quantity of the medical evidence and the opinions
Although the courts must take into account any conflict of interest on behalf of the plan administrator in reviewing a denial of benefits, Firestone, 489 U.S. at 115, 109 S.Ct. 948, the Sixth Circuit "has rejected the notion" that a conflict of interest "alters the standard of review." McCartha v. Nat'l City Corp., 419 F.3d 437, 442-43 (6th Cir.2005) (citing Peruzzi v. Summa Med. Plan, 137 F.3d 431, 433 (6th Cir. 1998)). However, the Sixth Circuit has also cautioned, "[c]ourts should be particularly vigilant in situations where ... the plan sponsor bears all or most of the risk of paying claims, and also appoints the body designated as the final arbiter of such claims." Univ. Hosps. of Cleveland v. Emerson Elec. Co., 202 F.3d 839, 847 n. 4 (6th Cir.2000). When a claimant "offers more than conclusory allegations of bias[,]" the conflict-of-interest factor is more significant. Judge v. Metro. Life Ins. Co., 710 F.3d 651, 664 (6th Cir.2013) (quoting DeLisle v. Sun Life Assurance Co. of Canada, 558 F.3d 440, 445 (6th Cir.2009)).
Mrs. Cultrona argues that the BAC was operating under a conflict of interest when it denied her claim. (Pl.'s Mot. at 587, 589-90.) Indeed, because Nationwide appoints members of the BAC, the instant case presents the sort of situation that the Sixth Circuit urged courts to be wary of in Emerson. However, Mrs. Cultrona offers only general observations about the structure of Nationwide and the BAC, not specific circumstances that would indicate the importance of the conflict in this particular instance. The Court, upon its own inquiry, finds no such circumstances. Accordingly, while the Court will consider the conflict in determining whether the BAC's decision was arbitrary and capricious, it will not afford the conflict significant weight. See Judge, 710 F.3d at 663-64.
Mrs. Cultrona asserts that the BAC failed to apply Exclusion 12 reasonably because the "law of the locale" referenced therein must be construed to mean the local law of Twinsburg, Ohio, not Ohio state law. To support this argument, she points to numerous uses of phrases such as "applicable state law" and "laws of the state" elsewhere in the Policy, suggesting that Nationwide made a conscious decision not to reference state law in the text of Exclusion 12. (Pl.'s Opp'n at 642.)
Simply from a logical perspective, Nationwide's references to state law elsewhere in the Plan do not, in this instance, lead to the inference that "law of the locale" must mean the local law of Twinsburg, Ohio. The word "locale" is used in Exclusion 12 to refer to the place where an Injury, as defined in the Policy, is sustained. (Admin. Rec. at 249.) Because nothing in the Plan requires an Injury to occur within the United States to be covered thereunder, a reference to "state law" in Exclusion 12 would not have properly captured instances in which an Injury was suffered outside the country.
Further, other courts have read similar "law of the locale" language to refer to state law rather than local law. See Hargrave v. Parker Drilling Co., No. 10-0141,
Ohio does not have a statute defining "under the influence" or "intoxication" in a general sense. Instead, the terms appear in various statutes forbidding specific activities. The most well known example, Ohio's drunken driving statute, forbids, among other things, operating a vehicle with a blood alcohol content at or above 0.08%. Ohio Rev.Code § 4511.19. The statute also, however, forbids simply operating a vehicle "under the influence of alcohol" without defining "under the influence." Id. Ohio's prohibition against operating watercraft while under the influence mirrors the drunken driving statute in these respects. Ohio Rev.Code § 1547.11. Ohio's worker's compensation statute explicitly references the drunken driving statute, establishing a rebuttable presumption "that an employee is intoxicated or under the influence" if the employee would be under the influence per the drunken driving statute. Ohio Rev.Code § 4123.54. In less specific fashion, another Ohio statute prohibits the carrying or use of firearms "while under the influence of alcohol" without establishing impermissible blood alcohol levels or defining "under the influence." Ohio Rev.Code § 2923.15 Finally, Ohio's disorderly conduct statute provides, in pertinent part, that "[n]o person, while voluntarily intoxicated, shall ... [e]ngage in conduct or create a condition that presents a risk of physical harm to the offender or another, or to the property of another." Ohio Rev.Code § 2917.11(B)(2).
Some courts have interpreted state statutory blood alcohol limits established in specific contexts to create a general presumption of intoxication that can operate outside of those contexts. See Veal, 2010 WL 1380170, at *2 (applying state drunk driving and firearms statutes to identical Exclusion 12 in the case of a man who died from a fall); Likens v. Hartford Life and Accident Ins. Co., 688 F.3d 197, 200 (5th Cir.2012) (adopting the definition of "intoxication" in the Texas Penal Code as the proper definition of "legal intoxication" in an alcohol exclusion applied to a man who died from a fall at his home).
The weight of persuasive authority, however, including cases from within this circuit and Ohio state law, counsels that application of state statutes setting blood alcohol limits for specific activities outside of those contexts is improper. See, e.g., Loan v. Prudential Ins. Co. of America,
Mrs. Cultrona believes that the Sixth Circuit's decision in Loan controls and shows that the BAC acted arbitrarily and capriciously in denying her claim. In Loan, the court examined Kentucky law in order to define the phrase "being legally intoxicated" in an alcohol exclusion in an ERISA plan. 370 Fed.Appx. at 595. The Supreme Court of Kentucky had already adopted a definition of "intoxication" to be used in alcohol exclusions, applying the standard contained in Kentucky's public intoxication statute. Healthwise of Ky., Ltd. v. Anglin, 956 S.W.2d 213, 218 (Ky. 1997). The defendant in Loan argued that the court should instead adopt the definition from Kentucky's motor vehicle statute. 370 Fed.Appx. at 595. The Sixth Circuit rejected this argument and adopted the definition selected by the Supreme Court of Kentucky in Anglin. Loan, 370 Fed.Appx. at 595-96.
The Court finds that Loan does not control. To begin with, Loan is an unpublished decision, and "[i]t is well-established law in this circuit that unpublished cases are not binding precedent." Bell v. Johnson, 308 F.3d 594, 611 (6th Cir.2002). Further, the court in Loan had the benefit of an applicable state supreme court decision, which is not the case here. Moreover, the court in Loan found that it was unreasonable for the plan administrator to apply the definition of "intoxication" from an activity-specific statute (i.e., driving a motor vehicle) to someone who was not performing that activity, but was, instead, in their own home, particularly when the Kentucky Supreme Court had already adopted a definition to be used in applying such exclusions.
Thus, even if Loan were mandatory authority, the opinion would stand for, at most, two things: (1) an inferred rule that this Court should apply the definition of "intoxication" adopted by the Ohio Supreme Court, which has not addressed the issue, and (2) that the Court may not import the definition of "intoxication" from a state motor vehicle statute, which defendants explicitly disclaim any reliance upon. (Defs.' Opp'n at 665.)
Rather than basing its denial upon one or more Ohio statutes setting limits on blood alcohol content with respect to performing specific activities, the BAC claims
The pertinent question, then, is whether it was reasonable for the BAC to believe that, under § 313.19, a coroner's unchallenged finding of intoxication as a cause of death constitutes "deem[ing] and presum[ing], under [Ohio law]," that a decedent was "under the influence of alcohol or intoxicating liquors." The Court finds that it was.
The Ohio Supreme Court has held that, under § 313.19, "the coroner's factual determinations concerning the manner, mode and cause of the decedent's death, as expressed in the coroner's report and death certificate, create a non-binding, rebuttable presumption concerning such facts in the absence of competent, credible evidence to the contrary." Vargo v. Travelers Ins. Co., 34 Ohio St.3d 27, 516 N.E.2d 226, 229 (1987). "[O]ne function of R.C. 313.19 is to set forth the presumptive value of a coroner's determination as evidence in civil and criminal cases in which the cause, manner, and mode of death are at issue." TASER Int'l, Inc. v. Chief Med. Exam'r of Summit Cnty., No. 24233, 2009 WL 826416, at *10 (Ohio Ct.App. Mar. 31, 2009). Accordingly, the coroner's duties under the statute are "quasi-judicial in character," and the death certificate is "admissible as prima facie evidence of the facts therein stated." Vargo, 516 N.E.2d at 229 (quoting Perry v. Indus. Comm'n, 160 Ohio St. 520, 117 N.E.2d 34, 37 (1954)). "[T]o rebut the coroner's determination,... competent, credible evidence must be presented." Id. "The hearing conducted by the court pursuant to [§ ]313.19 is a judicial proceeding, and the procedures and results must be in accord with the Rules of Evidence." Estate of Holley v. Am. Family Life Assurance of Columbus, No. 04CA5, 2005 WL 1097799, at *3 (Ohio Ct.App. May 5, 2005).
The medical examiner's report states that the cause of Mr. Cultrona's death was "[a]sphyxia by extreme and restricted position (positional asphyxia). II: Acute ethanol intoxication." (Admin. Rec. at 342.) "Acute ethanol intoxication" is listed as "[e]vidence of positional asphyxia," and the examiner states that Mr. Cultrona "died due to apparent positional asphyxia when he became unconscious while intoxicated (passed out)" and that "[t]he postmortem toxicology and microscopic liver findings are consistent with an active period of alcohol binge drinking." (Id. at 343.) Similarly, the death certificate lists "Acute Ethanol Intoxication" as a "significant condition contributing to death but not resulting in the underlying cause," and describes Mr. Cultrona's injury as "Prolonged And Extreme Hyperextension Of Neck And Torso While Intoxicated." (Id. at 421.)
Mrs. Cultrona has not attempted to rebut these findings, and instead offers the conclusory and unsupported statements that "[a] coroner's determination is not law," and, even if it were, " § 313.19 does not deem and presume Mr. Cultrona, as a matter of law, to have been `under the influence of alcohol' in his bathroom." (Pl.'s Opp'n at 643.)
The administrative record shows, however, that the medical examiner found Mr. Cultrona to have been intoxicated by alcohol at the time of his death and that his
Mrs. Cultrona claims that defendants could not have reviewed § 313.19 because their denial letters do not refer specifically to that statutory section and it does not appear in the administrative record, and therefore defendants acted arbitrarily and capriciously in denying her claim. This argument requires the Court to examine whether the communications between defendants and Mrs. Cultrona meet ERISA's procedural requirements for the handling of benefits claims, including those having to do with denial letters. According to 29 U.S.C. § 1133:
The implementing regulations require that a plan administrator provide a claimant with "written or electronic notification of any adverse benefit determination," which must provide:
29 C.F.R. § 2560.503-1(g).
When evaluating benefits decisions for procedural errors, the Court "utilizes a `substantial compliance' standard." Kent v. United of Omaha Life Ins. Co., 96 F.3d 803, 808 (6th Cir.1996). Under that standard, the Court will not disturb a benefits decision based on a procedural defect when the plan administrators fulfilled the purposes of § 1133: "insuring that the claimant understood the reasons for the denial of the claim as well as her rights to review of the decision." Id. at 807. All
Both denial letters substantially comply with the requirements of § 1132. Each lists that defendants reviewed the medical examiner's report, the toxicology report, the death certificate, and the police report, determining therefrom that Mr. Cultrona was intoxicated at the time of his death. (Admin. Rec. at 236-37, 297-98.) Each also refers to the specific Plan provision upon which the determination was based: Exclusion 12, the alcohol exclusion. (Id. at 237, 298.)
Mrs. Cultrona does not cite to any authority to support her contention that defendants had to specifically reference § 313.19 in their denial letter or that § 313.19 has to be referenced in the administrative record in order for defendants to assert that they relied upon it in determining that Mr. Cultrona was "under the influence of alcohol or other intoxicating liquors." Defendants' communications, taken as a whole, fulfilled the purposes of § 1133; that is, they insured that Mrs. Cultrona understood the reasons for the denial and her rights to appeal the decision. See Kent, 96 F.3d at 807 (finding substantial compliance with § 1133 even though "the first [denial] letter did not meet the requirements of the statute and regulation, and the second letter was untimely"). Moreover, even if defendants' communications with Mrs. Cultrona did not substantially comply with § 1133's requirements, remand would be a "useless formality" because defendants' denial of her claim was reasonable.
Mrs. Cultrona also argues that the BAC acted arbitrarily and capriciously by failing to "consult with a health care professional who has appropriate training and experience in the field of medicine involved in the medical judgment," as she alleges is required under 29 C.F.R. § 2560.503-1(h)(3)(iii). The regulations make clear, however, that 29 C.F.R. § 2560.503-1(h)(3) pertains only to "group health plans." "The term `group health plan' means an employee welfare benefit plan to the extent that the plan provides medical care... to employees or their dependents ... directly or through insurance, reimbursement, or otherwise." 29 U.S.C. § 1191b(a)(1).
Simply put, the Plan is not a group health plan. Kallaus v. Nationwide Death Benefit Plan, No. 2:09-CV-0899, 2012 WL 5411082, at *14 (S.D.Ohio Nov. 6, 2012) (evaluating the same Plan as in the instant case and rejecting the argument that Loan requires the BAC to consult a medical expert because "29 C.F.R. 2560.503-1(h)(3)(iii) only applies to group health plans and disability benefit plans, not to the claim at issue here").
Further, "[t]he need for an independent medical examination is a case-specific matter and that issue is subsumed by the question whether the decisionmaker
The case law thus places no obligation on the BAC to consult with an independent health care professional. As in Cornish, the administrative record in the instant case contains no disputed evidence on the cause of Mr. Cultrona's death. The BAC acted reasonably in acknowledging what was clearly indicated by voluminous, undisputed evidence.
Mrs. Cultrona also alleges that the BAC's failure to consult an independent medical expert violated its own charter. (Pl.'s Mot. at 593.) The BAC charter requires a medical expert, "[f]or appeals that involve a medical issue," to "be present at the meeting for discussion of the appeal," and explicitly prescribes that "[s]uch expert may be member of the BAC...." (Pl.'s Mot. Ex. A at 612.)
Ultimately, Mrs. Cultrona has not set forth any authority related to a plan administrator's compliance with and construction of terms within its own charter. Even if Mrs. Cultrona had established that the BAC's violation of its own charter constituted arbitrary and capricious behavior, however, she has not shown that the BAC exceeded the charter's bounds in this case. Her appeal did not raise any issues related to the autopsy report, toxicology report, death certificate, or the police report. The stated basis of her appeal was simply that "she did not receive proper notice of Amendment No. 1" and that "Amendment No. 1 is otherwise ineffective to serve as a basis for denying coverage." (Admin. Rec. at 287.) Without any evidence in the administrative record to suggest that Mrs. Cultrona was attacking the findings in the aforementioned documents, the Court cannot say that the BAC acted unreasonably in determining that her appeal did not involve a "medical issue," and thus was not an appeal that required the presence of a medical expert during its discussion.
Finally, Mrs. Cultrona contends that defendants acted arbitrarily and capriciously by "switching their rationale" for denying the benefit. (Pl.'s Mot. at 595.) A plan administrator "may not initially deny benefits for one reason, and then turn around and deny benefits for an entirely different reason, after an administrative appeal, without affording the claimant an opportunity to respond to the second, determinative reason for the denial of benefits." Balmert v. Reliance Standard Life Ins. Co., 601 F.3d 497, 501 (6th Cir. 2010). According to Mrs. Cultrona, the defendants violated this rule when they originally denied benefits based upon a prior version of Exclusion 12 — requiring operation of a motor vehicle while under the influence — and then, after appeal, based their denial upon the amended version of Exclusion 12 — no longer requiring the operation of a motor vehicle. (Id. at 595-96.)
Defendants argue that the mistaken use of an outdated Exclusion 12 in their first denial letter was corrected and that Mrs. Cultrona was afforded the opportunity to respond to defendants' denial based upon the amended Exclusion 12. (Defs.' Opp'n at 673.) The administrative record supports defendants' position. StarLine's first denial letter is dated October 21, 2011. (Admin. Rec. at 297.) Mrs. Cultrona's counsel faxed correspondence to StarLine on November 10, 2011, disputing that the outdated Exclusion 12 applied to Mr. Cultrona's injury. (Id. at 295.) StarLine responded on November 17, 2011, quoting the amended version of Exclusion 12, apologizing for the mistake, reiterating its denial, and referencing Mrs. Cultrona's appeal rights in the October 21 denial letter. (Id. at 290.) Mrs. Cultrona's counsel responded November 18, 2011, informing StarLine to "consider this [fax to be] notice of appeal of your November 17, 2011 letter continuing to deny coverage and disclaiming liability for payment under the Policy." (Id. at 287.) After receiving the claim file from StarLine, the BAC conducted a review of Mrs. Cultrona's appeal and sent its denial letter on January 19, 2012. (Id. at 236.)
Because the administrative record shows that Mrs. Cultrona appealed after being informed by StarLine of the amended Exclusion 12 and its intention to uphold its denial, StarLine afforded Mrs. Cultrona the opportunity to respond to the proper rationale used to deny her claim. Moreover, the Court is not convinced that the BAC's denial letter denies benefits for "an entirely different reason" than the one given by StarLine. StarLine's letter of November 17, 2011 is effectively a correction of its first denial letter of October 21, 2011. Accordingly, the BAC's denial letter is based on the exact same reasoning as that of StarLine.
For the foregoing reasons, the Court finds that defendants acted reasonably in denying Mrs. Cultrona's claim for benefits. Consequently, Mrs. Cultrona's motion for judgment on the administrative record on Counts III and IV of her amended complaint is denied, and defendants' motion for the same is granted.
In addition to the full amount of the Plan benefit, Mrs. Cultrona seeks statutory penalties under 29 U.S.C. § 1132(c)(1) for the BAC's alleged failure
Section 1132(c)(1) provides for a remedy in the event that a plan administrator violates, among other provisions, ERISA § 104(b)(4), which is codified at 29 U.S.C. § 1024(b)(4). Section 1024(b)(4) provides, in pertinent part:
ERISA gives district courts "discretion" to impose up to $110 a day in penalties against "[a]ny administrator ... who fails or refuses to comply with a request for any information which such administrator is required by this subchapter to furnish to a participant or beneficiary ... by mailing the material requested ... within 30 days after such request...." 29 U.S.C. § 1132(c)(1)(B) (establishing a maximum penalty of $100/day); 29 C.F.R. § 2575.502c-1 (increasing the maximum penalty to $110/day).
As part of her claim for statutory damages, Mrs. Cultrona asserts that 29 U.S.C. § 1029(c)
Section 2560.503-1 is a regulation implementing 29 U.S.C. § 1133. VanderKlok v. Provident Life and Accident Ins. Co., 956 F.2d 610, 615 (6th Cir.1992). In contrast, § 1133 imposes obligations on the plan, but "does not impose liability on the plan administrator." Id. at 618. Accordingly, "a violation of section 1133 by the plan administrator does not impose liability on the plan administrator pursuant to section 1132(c)...." Id. See also Brucks v. Coca-Cola Co., 391 F.Supp.2d 1193, 1210 (N.D.Ga.2005) (distinguishing between "Plan documents required to be provided under Section 1024" and "the much broader category of documents `relevant' to [claimant's] claim").
Although the BAC did not have a duty to provide Mrs. Cultrona with all documents relevant to her claim, it did have a duty to provide her with the Plan documents upon written request. Mrs. Cultrona contends that the BAC breached that duty.
In a letter to StarLine sent November 18, 2011, Mrs. Cultrona's counsel, in addition to providing notice of Mrs. Cultrona's appeal, requested "all documents that you contend prove that Nationwide provided notice of [the amendment to Exclusion 12] to Mrs. Cultrona and all documents comprising the administrative record and/or supporting Nationwide's decision." (Admin. Rec. at 287.) StarLine responded on November 22, 2011, confirming receipt of the letter and stating that "[a] copy of your letter has been sent to Nationwide...." (Id. at 283.) The BAC does not dispute that it "eventually received a copy of Plaintiff's November 18, 2011 letter...." (Defs.' Opp'n at 674), and the administrative record shows that the BAC received the letter on December 2, 2011 (Admin. Rec. at 236, 242). The BAC ruled on Mrs. Cultrona's appeal (Admin. Rec. at 236-38), but Mrs. Cultrona did not receive the requested documents until June 12, 2012 (Am.Compl.¶ 53). Mrs. Cultrona seeks statutory damages from the BAC under 29 U.S.C. § 1132(c)(1) for its delay in sending her the documents.
Mrs. Cultrona agrees with defendants that the documents sought in her November 18, 2011 letter are not "expressly listed in [§ 1024(b)(4)]" (Pl.'s Mot. at 599) and argues that the phrase "other instruments under which the plan is established or operated" in § 1024(b)(4) is a broad "catch-all" provision that includes her request (Pl.'s Reply at 689). The BAC argues that the documents requested by Mrs. Cultrona are not "other instruments under which the plan is established or operated" under § 1024(b)(4).
The Sixth Circuit has interpreted the "other instruments under which the plan is established or operated" language of § 1024(b)(4) not as a broad "catch-all," but as a phrase that must be "limited to those class of documents which provide a plan participant with information concerning how the plan is operated." Allinder v. Inter-City Prods. Corp., 152 F.3d 544, 549
The documents Mrs. Cultrona requested related to Nationwide's providing (or not providing) notice of the amendment of Exclusion 12 do not concern the operation of the Plan. See Collins v. Commonwealth Indus., No. 07-57-C, 2009 WL 197367, at *2 (W.D.Ky. Jan. 26, 2009) (a notice of an amendment "caus[ing] a significant reduction in the rate of future benefit accrual" under 29 U.S.C. § 1054(h)(1) "is not the type of document required to be provided under § 104").
Similarly, the administrative record is not part of the disclosure requirements of § 1024(b)(4). See Weddell v. Ret. Comm. of Whirlpool Prod. Emps. Ret. Plan, No. 3:07-CV-6, 2007 WL 4521509, at *14 (N.D.Ohio Dec. 17, 2007). As a result, the BAC did not violate § 1024(b)(4) by failing to provide these documents in response to Mrs. Cultrona's request.
However, despite the fact that Mrs. Cultrona's document request is worded in broad terms, both the request and Mrs. Cultrona's representation of that request in her briefing show that she sought, among other things, a copy of the AD & D Policy itself. The Policy, which contained the disputed Exclusion 12, was certainly one of the "documents ... supporting Nationwide's decision" to deny benefits. StarLine says as much in its denial letter. (Admin. Rec. at 297) ("Based on a review of the subject insurance [P]olicy...."). Similarly, Mrs. Cultrona notes that her document request was motivated in part by "being provided with the wrong Plan documents on two occasions," and that defendants "failed to provide the correct [P]lan documents containing the new Exclusion 12...." (Pl.'s Mot. at 601.)
At the time of Mrs. Cultrona's request, the Policy was clearly among the "currently operative, governing [P]lan documents," all of which are "instruments under which the plan is established or operated" for the purposes of § 1024(b)(4). Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73, 84, 115 S.Ct. 1223, 131 L.Ed.2d 94 (1995). See also Glasgow v. Methodist Healthcare-Memphis Hosps. Plan 503, No. 02-2234MV, 2005 WL 3844060, at *4 (W.D.Tenn. Dec. 2, 2005) (disclosure of disability benefit policy required under § 1024(b)(4)). The BAC, thus, had a duty under § 1024(b)(4) to provide Mrs. Cultrona with a copy of the Policy.
A showing of prejudice to the claimant is a "logical concern" in a court's decision to impose a penalty under § 1132(c)(1)(B), Gatlin v. Nat. Healthcare Corp., 16 Fed.Appx. 283, 289 (6th Cir.2001) (citing Bartling, 29 F.3d at 1068-69), but it is not essential. Some courts have imposed a penalty in the absence of a showing of prejudice. See McGrath v. Lockheed Martin Corp., 48 Fed.Appx. 543, 557
None of the parties briefed the issue of prejudice, nor did they discuss the amount of the penalty that should be assessed if the BAC is found to have violated § 1024(b)(4). Mrs. Cultrona does mention that the BAC's failure to provide the Plan documents "impaired Mrs. Cultrona's ability to understand her rights under the Plan and to evaluate the arguments to be raised during the appeals process." (Pl.'s Mot. at 601.)
Moreover, nothing in the administrative record as a whole suggests that Mrs. Cultrona was prejudiced by the BAC's failure to provide her with the Plan documents. Mrs. Cultrona claims to have been "provided with the wrong Plan documents on two occasions" (Pl.'s Mot. at 601), but the administrative record does not contain any written requests for documents, as required by § 1024(b)(4), except her letter to StarLine giving notice of appeal, which the BAC received on December 2, 2011. Further, Mrs. Cultrona did receive Plan Amendment I, which amended, among other things, Exclusion 12, from StarLine on November 17, 2011. (Admin. Rec. at 290-91). Mrs. Cultrona, thus, had a complete set of correct Plan documents prior to giving her notice of appeal.
Although Mrs. Cultrona has not shown that she was prejudiced by defendants' breach of their duty to disclose, this Court will nonetheless assess a penalty upon the BAC in light of the purpose of § 1132(c)(1), namely, "to punish plan administrators who fail to comply with requests for documents which ERISA requires them to provide." Knights of Columbus, 401 F.Supp.2d at 825-26. See also Bartling, 29 F.3d at 1068. The BAC, having received the complete claim file from Starline on December 2, 2011, knew that there had been confusion over the Plan documents, but did nothing in response to Mrs. Cultrona's request for a full set of the correct ones.
Because the BAC breached its duty to Mrs. Cultrona to disclose the Plan documents upon written request, Mrs. Cultrona's motion for judgment on the administrative record is granted in part and denied in part as to Count I of her amended complaint. The BAC's corresponding motion is thus granted in part and denied in part.
Mrs. Cultrona also brings claim for breach of fiduciary duty against all defendants pursuant to 29 U.S.C. § 1132(a)(3). In that claim, Mrs. Cultrona alleges that all three defendants breached their fiduciary duties by failing to evaluate and apply the "law of the locale" in denying her claim. She also contends that StarLine made a material misrepresentation regarding Mrs. Cultrona's claim by citing a prior version of Exclusion 12, and that Nationwide Life made material misrepresentations by providing incorrect Plan documents.
As a preliminary matter, defendants contend that Mrs. Cultrona cannot bring her breach of fiduciary duty claim under § 1132(a)(3) because it is duplicative of her claim for benefits under § 1132(a)(1)(B). Indeed, a denial of benefits claim cannot be "repackaged" as a breach of fiduciary duty claim and brought under § 1132(a)(3). Wilkins, 150 F.3d at 616. However, the fact that an award of benefits under § 1132(a)(1)(B) would resolve a § 1132(a)(3) claim does not necessarily mean that the § 1132(a)(3) claim is a "repackaged" denial of benefits claim. Gore v. El Paso Energy Corp. Long Term Disability Plan, 477 F.3d 833, 841 (6th Cir.2007). A plaintiff may bring both a § 1132(a)(1)(B) claim for denial of benefits and a § 1132(a)(3) claim for breach of fiduciary duty where "the plaintiff s[eeks] recovery of benefits according to the plan terms as they were misrepresented to him by the defendant, rather than according to the actual terms of the plan." Moss v. Unum Life Ins. Co., 495 Fed.Appx. 583, 589 (6th Cir.2012) (citing Gore, 477 F.3d at 841-42).
Mrs. Cultrona's allegations that defendants breached their fiduciary duties by misapplying the "law of the locale" are an exact duplicate of her denial of benefit allegations and cannot be brought under § 1132(a)(3).
"To establish a claim for breach of fiduciary duty based on alleged misrepresentations concerning coverage under an employee benefit plan, a plaintiff must show: (1) that the defendant was acting in a fiduciary capacity when it made the challenged representations; (2) that these [representations] constituted material misrepresentations; and (3) that the plaintiff relied on those misrepresentations to [her] detriment." Moore, 458 F.3d at 433. A fiduciary breaches his duty by providing plan participants with materially misleading information, "regardless of whether the fiduciary's statements or omissions were made negligently or intentionally." Krohn v. Huron Mem'l Hosp., 173 F.3d 542, 547 (6th Cir.1999) (citing Berlin v. Mich. Bell Tel. Co., 858 F.2d 1154, 1163-64 (6th Cir.1988)). "Misleading communications to plan participants `regarding plan administration (for example, eligibility under a plan, the extent of benefits under a plan) will support a claim for a breach of fiduciary duty.'" Drennan v. Gen. Motors Corp., 977 F.2d 246, 251 (6th Cir.1992) (quoting Berlin, 858 F.2d at 1163). "[A] misrepresentation is material if there is a substantial likelihood that it would mislead a reasonable employee in
ERISA defines a fiduciary as follows:
29 U.S.C. § 1002(21)(A). "[F]or purposes of ERISA, a `fiduciary' not only includes persons specifically named as fiduciaries by the benefit plan, but also anyone else who exercises discretionary control or authority over a plan's management, administration, or assets." Moore, 458 F.3d at 438. An interpretive bulletin from the Department of Labor further explains that a person without the power to make plan policies or interpretations but who performs purely ministerial functions such as processing claims, applying plan eligibility rules, communicating with employees, and calculating benefits is not a fiduciary under ERISA. 29 C.F.R. § 2509.75-8 D-2.
Mrs. Cultrona argues that StarLine and Nationwide Life were acting as fiduciaries because each was appointed by the BAC "to deliver [P]lan documents, manage the Plan, and aide [sic] in the disposition of Plan assets." (Pl.'s Mot. at 602.) Regardless of the fact that this is not made clear in the portions of the record Mrs. Cultrona cites for this proposition, the proper inquiry is not whether StarLine and Nationwide were fiduciaries in general, but whether they were "acting as a fiduciary (that is, [were] performing a fiduciary function) when taking the action subject to complaint." Pegram v. Herdrich, 530 U.S. 211, 226, 120 S.Ct. 2143, 147 L.Ed.2d 164 (2000) (emphasis added). Here, the actions subject to complaint are StarLine's provision of an incorrect version of Exclusion 12 in the course of denying Mrs. Cultrona's claim and Nationwide's alleged provision of incorrect Plan documents in response to Mrs. Cultrona's requests.
Beginning with StarLine, Sixth Circuit case law is informative on this issue. In the leading case, Baxter v. C.A. Muer Corp., 941 F.2d 451 (6th Cir.1991), a man sought medical benefits after being injured in an automobile accident while intoxicated. 941 F.2d at 452. Citing an analogous Eleventh Circuit case, the court found that the entity in question processed claims and disbursed benefits, but that "the employer reserved the right to review the denial of claims." Id. at 455 (citing Baker v. Big Star Div. of the Grand Union Co., 893 F.2d 288, 290 (11th Cir.1989)). Because the entity was "merely a claims processor that pays claims in accordance with the plan[,]" without the power to make plan policies or interpretations, it was not acting as a fiduciary in denying benefits. Id. at 455-56. See also Briscoe v. Fine, 444 F.3d 478, 489 (6th Cir.2006) (third-party administrator was not a fiduciary where it had power to determine eligibility for benefits, process claims, and assist plan administrator in producing reports required by law, but where employer retained final authority to determine a claim should be paid and was the entity to which dissatisfied employees were instructed to direct their appeal).
Similarly, StarLine performed only ministerial functions in its initial denial of Mrs. Cultrona's claim. StarLine processed the claim and denied payment of the benefit under the terms of the Plan, but review of Mrs. Cultrona's appeal was conducted not
With respect to Nationwide, defendants correctly point to two problems with Mrs. Cultrona's allegations at the outset. First, as mentioned earlier, Mrs. Cultrona uses the term "Nationwide" to refer collectively to defendant Nationwide Life and its parent corporation, non-party Nationwide Mutual Insurance Company (Am. Compl. ¶ 3), a reference defendants objected to in their answers (Answers ¶ 3). Because Mrs. Cultrona alleges that she requested and received incorrect Plan documents from "Nationwide," she has not established that those requests were received and processed by defendant Nationwide Life. Second, Nationwide Life has not admitted the allegations, and no evidence appears in the administrative record to substantiate them. For these reasons alone, judgment on the administrative record for Nationwide Life is proper. Additionally, even if Mrs. Cultrona had properly stated her allegations against Nationwide Life and Nationwide Life had admitted to those allegations, Nationwide Life would nonetheless be entitled to judgment on the administrative record because its response to Mrs. Cultrona's request for Plan documents was a ministerial function, and thus Nationwide Life would not have been acting in a fiduciary capacity.
Even if StarLine and Nationwide Life were acting in fiduciary capacities, Mrs. Cultrona has not established that she relied on their alleged misrepresentations to her detriment. In response to receiving materials documenting an outdated version of Exclusion 12, that which explicitly limited the exclusion to the context of operating a motor vehicle, Mrs. Cultrona claims that she did "not hav[e] additional examination or testing performed on Mr. Cultrona's body or regarding whether he passed out or fell in the bathroom[.]" (Pl.'s Mot. at 603.) But Mrs. Cultrona was quoted an incorrect Exclusion 12 from StarLine over four months after Mr. Cultrona died. Further, StarLine corrected its error within a month, and Mrs. Cultrona offers no explanation of why testing or other investigation could have been performed after four months, but not after five. In addition, assuming arguendo that her allegations against Nationwide Life are true, Mrs. Cultrona would have first received incorrect Plan documents from Nationwide Life eighteen days after Mr. Cultrona's death, and again over four months later. Mrs. Cultrona did not order additional testing or other investigation in the seventeen days following Mr. Cultrona's death, even though the autopsy was performed the day after he died. The injury having occurred in her home, she had access to the scene, and she could have interviewed witnesses, but there is nothing to indicate that she conducted her own investigation. Moreover, Mrs. Cultrona provides no theory, nor points to any evidence in the record, to suggest that additional testing or investigation into Mr. Cultrona's cause of death would have had any effect on her claim.
Because StarLine and Nationwide Life were not acting in a fiduciary capacity when they made misrepresentations to Mrs. Cultrona, and because Mrs. Cultrona did not rely on those misrepresentations to her detriment, Mrs. Cultrona's motion for judgment on the administrative record is
Lastly, Mrs. Cultrona seeks attorney's fees. In an ERISA action brought by a participant or beneficiary, "the court in its discretion may allow a reasonable attorney's fee and costs of action to either party." 29 U.S.C. § 1132(g)(1). When exercising this discretion, the Court considers the following five factors:
Sec'y of Dep't of Labor v. King, 775 F.2d 666, 669 (6th Cir.1985). The King factors "represent a flexible approach; none of them is necessarily dispositive." Foltice v. Guardsman Prods., Inc., 98 F.3d 933, 937 (6th Cir.1996) (internal quotation omitted). A fee claimant need not be a "prevailing party" to be eligible for an award of attorney's fees under § 1132(g)(1), but must achieve "some success on the merits." Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 130 S.Ct. 2149, 2159, 176 L.Ed.2d 998 (2010).
Other than one reference to an "approximate" total, Mrs. Cultrona has submitted no information regarding the amount or the calculation of her attorney's fees. Moreover, Mrs. Cultrona's motion for fees is premature, and is therefore denied without prejudice to renewal. See Fed. R.Civ.P. 54(d)(2).
For the foregoing reasons, plaintiff Nicole Cultrona's motion for judgment on the administrative record is
