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Johnson v. Life Insurance Co. of North America

United States District Court, D. Colorado

March 28, 2017

JULIE JOHNSON, Plaintiff,
v.
LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant.

          ORDER AFFIRMING TERMINATION OF BENEFITS

          WILLIAM J. MARTÍNEZ, UNITED STATES DISTRICT JUDGE

         In this case brought pursuant to 29 U.S.C. § 1132(a) of the Employee Retirement Income Security Act of 1974 (“ERISA”), Plaintiff Julie Johnson (“Johnson”) challenges the decision of Defendant Life Insurance Company of North America (“LINA”) to terminate her long-term disability insurance benefits. (ECF No. 1.) Currently before the Court is Johnson's Motion for Bench Trial on the Record (ECF No. 51) and the parties' Joint Motion for Determination (ECF No. 61). Both motions seek the same thing: administrative review of LINA's decision. For the reasons explained below, the Court finds that LINA's choice to terminate Johnson's disability benefits was not arbitrary or capricious, and its decision is therefore affirmed.

         Also before the Court is Plaintiff's Motion to Strike. (ECF No. 66.) The Court denies this motion as moot.

         I. BACKGROUND

         A. The Plan

         On October 19, 2007, UBS Financial Services (“UBS”) hired Johnson as a “Vice President Financial Advisor/Consultant” at a salary of $10, 833.33 per month. (ECF No. 51 at 11-12, ¶¶ 4, 6.)[1] Johnson then became covered under the UBS Long-Term Disability Plan (“Plan”). (Id. ¶¶ 1, 5.) That Plan provides long-term disability benefits in two phases. The first phase defines disability as follows: “if, because of Injury or Sickness, you are unable to perform all the material duties of your regular occupation, and solely due to Injury or Sickness, you are unable to earn more than 80% of your Indexed Covered Earnings.” (Administrative Record (“R.”) (ECF Nos. 17, 29, 37) at 3178 (emphasis added).) The second phase applies after benefits under the first phase have been paid for 24 months, and tightens the definition of disability by requiring more than just inability to perform the individual's regular occupation: “if your Injury or Sickness makes you unable to perform all the material duties of any occupation for which you may reasonably become qualified based on education, training or experience, and solely due to Injury or Sickness, you are unable to earn more than 80% of your Indexed Covered Earnings.” (Id. (emphasis added).)

         Defendant LINA administers claims under the Plan. (ECF No. 51 at 11, ¶ 3.) LINA also pays any approved benefits. (Id.)

         B. Short-Term Disability Claim

         Johnson applied for short-term disability benefits (not the same as the “regular occupation” long-term benefits discussed above) on October 6, 2010. (R. at 341.) For some time prior to this date, Johnson had been struggling with various medical conditions largely flowing from dysautonomia, a disease in which the autonomic nervous system fails to function properly. Dysautonomia manifested itself in Johnson primarily through an erratic heart rate and unpredictable drops in blood pressure, which in turn could lead to syncope (fainting due to insufficient blood flow to the brain), headaches, slow thinking, severe fatigue, impaired speech, and inability to cope well with stress. (ECF No. 51 at 13-14, ¶ 9.)

         Many of Johnson's treating physicians submitted their diagnoses to LINA. In addition to the above-stated diseases and symptoms, these physicians also noted bradycardia (abnormally slow heart activity), lack of coordination, dizziness, hand tremors, postural tremors, fibromyalgia, and sleep disruption. (Id. at 14-18, ¶¶ 11-20.) In December 2010, LINA awarded short-term disability benefits to Johnson, effective through April 3, 2011 (the maximum length available for such benefits). (Id. at 18, ¶ 22.)

         C. “Regular Occupation” Long-Term Disability Claim

         In February 2011, LINA “transitioned” Johnson's short-term disability claim to a review of entitlement to the first phase of long-term disability benefits, i.e., under the “regular occupation” standard. (Id. at 18, ¶¶ 23-24.) In a disability questionnaire filled out in March 2011, Johnson reported her “primary physical and/or mental condition preventing [her] from working now” as follows: “Cognitive dysfunction, bad balance, dizziness, headaches, black outs, fibromyalgia = pain, challenge in articulating thoughts, especially under stress.” (R. at 983.)

         That same month, Johnson's neurologist, Dr. Maureen Leehey, submitted a “Medical Request Form” to LINA. (R. at 977.) In the form's box labeled “What is the primary diagnosis?”, Dr. Leehey wrote, “dysautonomia[, ] fibromyalgia[, ] tremor.” (Id.) In the form's box labeled “What are the specific additional factors impacting return to work, if any?”, Dr. Leehey wrote, “hand tremor limits ability to perform routine activities[, ] lightheadedness, sometimes severe headaches (daily, continuous)[, ] severe fatigue[, ] poor sleep[, ] cognitive dysfunction[, ] gait impairment[, ] inability to tolerate extended standing.” (Id.) Dr. Leehey further wrote that the symptoms resulted from her primary diagnoses “and prevent any sustained mental or physical activities.” (Id.)

         In April 2011, LINA denied Johnson's long-term disability claim, largely citing the results of a neuropsychological evaluation LINA had ordered, which suggested that Johnson could continue to perform her normal job with certain “assistive strategies.” (R. at 612.) Johnson then invoked LINA's internal appeals process and submitted various additional letters from her treating physicians and from other medical professionals. (ECF No. 51 at 20-22, ¶¶ 33, 35, 39, 40.) Johnson also challeng ed LINA's classification of her former employment as “office and clerical” with a specific job description of the “brokerage clerk II.” (Id. at 21-24, ¶¶ 38, 41-45.) Johnson considered her correct job title to be “financial consultant.” (Id. at 22, ¶ 42.)

         As part of reviewing Johnson's appeal, LINA sent Johnson's medical file for review to a third-party physician, Ira Weisberg, and a third-party psychologist, Monica Lintott. Dr. Weisberg found insufficient objective evidence of Johnson's disability, and reported a conversation with Dr. Leehey in which Dr. Leehey expressed her view that “there was a fair amount of somatization on [Johnson's] part” (R. at 693), or in other words, expressing psychological symptoms as physical symptoms. Dr. Lintott, however, evaluated Johnson's neuropsychological testing and agreed with Johnson's position that she had significant impairments preventing her from continuing as a financial consultant in light of that profession's high-responsibility, detail-oriented nature. (Id. at 24, ¶¶ 46-47.) In December 2011, LINA reversed its previous denial and approved Johnson's long-term disability claim. (Id. ¶ 48.)

         D. Social Security Disability Award

         In the midst of the foregoing, LINA required Johnson to apply for Social Security Disability benefits, which, if awarded, would reduce LINA's payment obligation dollar for dollar. (Id. at 25, ¶ 49.) LINA paid for a third-party organization to represent Johnson in that process, and the application was filed in March 2011. (Id. ¶ 50.)[2] A Social Security Disability Examiner physician determined (apparently based on a file review) that Johnson's severe, medically determinable impairments were recurrent arrhythmias, fibromyalgia, disorders of the autonomic nervous system, discogenic and degenerative disorders of the back, and organic brain syndrome. (Id. ¶ 51.) The examiner concluded that Johnson could not sustain a 40-hour work week due to her impairments. (Id. ¶ 53.) In June 2011, the Social Security Administration found Johnson disabled and awarded her SSDI benefits. (Id. ¶ 54.)

         E. “Any Occupation” Long-Term Disability Review

         In August 2012, LINA informed Johnson that the second phase of long-term disability benefits would apply beginning in April 2013. (Id. at 26, ¶ 55.) In other words, Johnson's entitlement to benefits beginning in April 2013 would turn on whether she was incapable of performing “any occupation for which [she] may reasonably become qualified based on education, training or experience” that would pay her 80% of her prior salary. (R. at 3178.) LINA informed Johnson that it had “begun a review to determine if [Johnson would] remain eligible for benefits” under that standard. (R. at 586.) LINA noted that it would request “current information from both [Johnson] and [her treating] physicians.” (Id.)

         In truth, LINA had begun requesting updated information from Johnson the previous month. Specifically, on July 16, 2012, LINA sent Johnson a form to fill out titled “Disability Questionnaire & Activities of Daily Living.” (R. at 588-91.) Johnson filled out and returned that form about a week later. (See R. at 2456.) The form begins by stating, “In your own words, tell us why you cannot work in your own or in any occupation.” To this, Johnson responded, “Need to nap every day, dizzy/syncope often, chronic migraines, poor memory, hospitalization.” (R. at 2458.) In response to the question, “What is [the] primary physical and/or mental condition preventing you from working now?”, Johnson answered, “Migraines, syncope, poor mental acuity.” (Id.) Johnson noted that she frequently needed to use the handrails in her home to go up and down stairs, and that she had “oxygen to help.” (Id.) She also stated that she goes for walks “3 days/week” but “not far” and only for “15-20 minutes with help.” (Id.)

         LINA then obtained updated information from Johnson's physicians. In August 2012, it received a Physical Ability Assessment (“PAA”) from Dr. Howard Weinberger, Johnson's cardiologist. (R. at 2452.) In the PAA, which is similar to a residual functional capacity assessment in Social Security disability cases, Dr. Weinberger diagnosed syncope, autonomic dysfunction, and migraine headaches. (Id.) He then opined that Johnson could perform the following activities “Constantly” (greater than 5.5 hours per day): sit, reach, manipulate with both hands, grasp with both hands, see, hear, and use lower extremities for foot controls. (Id. at 2452-53.) Dr. Weinberger further opined that Johnson could perform the following activities “Occasionally” (from zero to 2.5 hours per day): standing, walking, lifting up to twenty pounds, and carrying up to twenty pounds. (Id.)

         In September 2012, LINA received a response from Dr. Leehey, Johnson's neurologist, to a letter sent by LINA the month before asking for recent medical records. (R. at 2189.) Dr. Leehey wrote in that response that Johnson “cannot do prolonged activity of any kind, including mental activity under pressure, ” that she “needs frequent rest periods [due to] fatigue, ” and that “tremor causes dexterity problems, [she] needs longer to do things.” (Id.) Dr. Leehey also returned a PAA on which she diagnosed tremor, postural imbalance, migraines, concentration deficit, and episodic lightheadedness. (R. at 2191.) Dr. Leehey opined that Johnson could sit only “Occasionally” throughout the day, as compared to Dr. Weinberger's “Constantly.” Dr. Leehey also opined that Johnson could manipulate and grasp “Frequently” (2.5-5.5 hours per day), as compared to Dr. Weinberger's “Constantly.” (Id.)

         In October 2012, LINA received a response from Dr. Donald Rollins, Johnson's pulmonologist, to a letter sent by LINA asking for recent medical records. (R. at 2131.) Dr. Rollins referred LINA to Dr. Weinberger with respect to Johnson's “history of autonomic dystonia and syncope, which is the reason for her disability.” (Id.) Dr. Rollins then attached an August 2012 treatment note from Dr. Weinberger, which stated, among other things, the following:

There has been some suspicion and some evidence of possible autonomic dysfunction; however, recent evaluation at [the] Mayo Clinic did not find definitive evidence for autonomic failure or multisystem atrophy. The patient did have one episode of syncope in 06/2012 associated with an acute [gastrointestinal] illness, but otherwise has had no other true syncope since 09/2011.

(R. at 2135.)

         These somewhat conflicting reports from Johnson's physicians apparently raised LINA's suspicions, because LINA next arranged for covert surveillance of Johnson from October 18 through October 20, 2012. (R. at 2102.) The surveillance contractor reported no activity on the first day. (R. at 2109.) The second day, however, was much more eventful. In the mid-morning, Johnson exited her house and went on a 35-minute walk around her neighborhood while pushing a baby stroller and walking two dogs. (R. at 2110.) “She appeared to perform this activity in a fluid manner.” (Id.) In the late morning, Johnson again left her house and drove approximately twenty miles to a restaurant where “she sat, ate, and spoke to an unidentified female.” (R. at 2111.) She again “appeared to perform this activity in a fluid manner.” (Id.) Johnson was then observed going into a nearby movie theater with her lunch companion, and exiting about ninety minutes later, yet again performing all of these activities “in a fluid manner.” (R. at 2112.) She finally drove herself home in the mid-afternoon. (Id.)

         On the morning of the third day of surveillance, Johnson was observed putting gas in her car at a gas station “nearby” her home, then briefly visiting a tire store, and then spending 84 minutes at a park approximately eight miles from her home, where her children were playing a soccer game. (R. at 2114.) She then briefly went back to the tire store, and finally returned home in the early afternoon. (R. at 2115.) All of this was apparently done “in a fluid manner.” (R. at 2114.) The surveillance contractor observed nothing else of interest that day.

         LINA next arranged for an independent medical examination (“IME”). A third-party vendor scheduled that IME with John Bermundez, Ph.D., a psychologist. (R. at 2076, 2085.) Either shortly before or after the exam, which took place on December 17, 2012, Dr. Bermundez reviewed 720 pages of Johnson's medical records. (R. at 2085, 2087.) At the exam itself, Johnson “had a wheeled oxygen tank in tow, and she kept the can[n]ula [tube delivering oxygen to the nostrils] in place during the examination and testing.” (R. at 2089.) Dr. Bermundez also noticed “a rather co[a]rse tremor of the fingers of the right hand at the start of the examination, ” but the tremor “ceased with distraction and was absent for the remainder of the examination except for one or two very brief moments” when Johnson “seemed to be gazing at her hand.” (Id.) With respect to Johnson's syncope, Johnson reported to Dr. Bermundez that her symptoms were “due to orthostatic hypotension [sudden drop in blood pressure when quickly standing up]” and were “manageable by not rising too quickly from a seated or reclining position.” (Id.)

         Dr. Bermundez administered numerous psychological tests over approximately five hours. (Id.) In evaluating Johnson's testing performance, Dr. Bermundez reported

strong indications of feigned symptoms that seemed to be selectively focused to present her as afflicted with both memory impairments and impaired ability to calculate and to process symbols. This was demonstrated by her extraordinar[ily] biased test responses, and by selectively slower production on certain timed tasks, and spontaneous, rapid responses in other contexts. Therefore, certain of her test results are in my opinion invalid representations of true weakness, if any, [and are] inconsistent with [Johnson's] described complaints and symptoms. Based on clinical observation and analysis of her test abilities it is my professional opinion that her concentration, memory and attention are intact and unimpaired.

(R. at 2090-91.) Dr. Bermundez further reported that Johnson's test scores “were so unlikely that the results could statistically and reasonably only have been due to deliberate selection of incorrect responses. . . . The possibility of malingering could not be ruled out.” (R. at 2091.) Dr. Bermundez ultimately concluded that Johnson possessed all of the “[t]emperaments and [a]ptitudes” necessary to perform well in a high-responsibility, detail-oriented workplace. (R. at 2096.)

         In January 2013, LINA sent Dr. Bermundez's report to Michele Colella, an in-house vocational rehabilitation counselor, for a “transferable skills analysis.” (R. at 2082.) Colella determined that the “brokerage clerk II” job title relied upon in Johnson's earlier “own occupation” proceedings was incorrect in light of Johnson's self-reported work history. (R. at 221; see also Part I.C, above.) Colella determined that “registered representative” was the appropriate title. (R. at 221.) Applying that title, Colella determined that Dr. Bermundez's findings showed Johnson capable of continuing to work as a registered representative, her “previous occupation.” (R. at 2082.) Thus, there was at least one job Johnson could perform, according to Colella, who then turned to the “any occupation” disability definition's requirement that the job earn at least 80% of Johnson's prior salary. Colella calculated Johnson's “indexed” monthly earnings at $11, 180 per month, meaning that a registered representative must normally make $8, 944 per month or LINA cannot consider it when determining Johnson's disability status. (Id.) Colella found, however, that registered representatives in the Denver-Aurora metropolitan statistical area (which encompasses Johnson's home) earn $9, 561 per month, or more than 80% of Johnson's indexed monthly wage. (Id.) Thus, according to Colella's analysis, Johnson no longer qualified as disabled.

         At the same time Colella was preparing her analysis, LINA was continuing to review Johnson's eligibility in other ways. On January 3, 2013, a LINA employee called Johnson to find out whether the Social Security Administration had recently reevaluated Johnson's SSDI benefits. (R. at 231.) According to LINA's report of the call, Johnson responded that a reassessment took place “approximately 6 mo[nths] ago.” (Id.) The next day, LINA called again “to clarify when [Johnson] had her testing and evaluation by the SSA.” (R. at 230.) This time Johnson reported that she was “not sure when she had the re-evaluation by SSA but she know[s] it was last year but not sure if it was in the last 6 months.” (Id.) LINA therefore secured Johnson's authorization to obtain her file directly from the Social Security Administration. (R. at 560-61.) LINA obtained that file in February 2013 and learned that all of the medical documents dated from 2010 and 2011 (R. at 222), or in other words, the Social Security Administration had not recently evaluated Johnson's disability status.

         LINA's final step before concluding its “any occupation” investigation was to send Dr. Bermundez's IME report to some of Johnson's physicians, including Dr. Weinberger (cardiologist), Dr. Rollins (pulmonologist), and Dr. Leehey (neurologist). (R. at 550-55.) Each of these letters stated in relevant part,

We received the results of an Independent Medical Evaluation (IME) conducted on December 17, 2012 regarding your patient, Julie Johnson. The [IME] report concluded that your patient demonstrated an ability to perform sedentary work . . . .
We are currently reviewing your patient's claim [of] Long Term Disability benefits. Please review and respond to the attached [IME] report. . . . If the requested information is not received by February 20, 2013, we will make a decision based on the information we currently have on file.
Please indicate whether you agree or disagree with the [IME] report enclosed. If you agree, please check the appropriate box [below] and return this letter via fax. If you disagree with this report, please provide [a] detailed objective rationale and office records to support your findings.

(See, e.g., R. at 550.)

         Dr. Weinberger faxed a response on February 19, 2013. (R. at 2030-32.) He checked the “No, I disagree” option but provided no support beyond a single sentence: “Pacemaker ...


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