Ellis v. Liberty Life Assurance Co. of Boston

          MEMORANDUM OPINION AND ORDER

          LEWIS T. BABCOCK, JUDGE

         This ERISA case is before me on Plaintiff Michael D. Ellis's Motion for Reconsideration/Amendment of Judgment under Fed.R.Civ.P. 59 and/or for Relief From Order Pursuant to Rule 60 [Doc #68]. In its response to Mr. Ellis's motion, Defendant Liberty Life Assurance Company of Boston (“Liberty”) moved to strike an exhibit attached to Mr. Ellis's motion [Doc #70]. After consideration of the parties' briefs, the record, and the case file, and for the reasons set forth below, I grant Mr.

         Ellis's motion; deny Liberty's motion to strike; vacate the judgment entered in this case in favor of Liberty; and enter judgment in favor of Mr. Ellis.

         I. Background

         By Memorandum Opinion and Order dated September 18, 2018 [Doc # 66] (the “Order”), I entered judgment in favor of Liberty on Mr. Ellis's claim that Liberty wrongfully terminated his long term disability benefits under Liberty's Group Disability Income Policy GF3-830-502315-01 (the “Policy”). In analyzing Mr. Ellis's claim, I applied an arbitrary and capricious standard of review after determining that the Policy provision giving Liberty discretionary authority to construe the terms of the Policy and determine benefits eligibility was not void pursuant to C.R.S. § 10-3-1116(2) which prohibits such discretionary provisions. By his motion, Mr. Ellis, represented by new counsel, again argues that § 10-3-1116(2) is applicable in this case and that his benefits claim is therefore subject to de novo review. Mr. Ellis further argues that de novo review dictates that judgment be entered in his favor on his claim for continuing long term disability benefits under the Policy.

         III. Analysis

         A. Standard of Review

         My conclusion that § 10-3-1116(2) was not retroactively applicable to the Policy was predicated on the fact that the Policy was issued in 2005, prior to the enactment of §10-3-1116(2) in 2008. In reaching this conclusion, I considered Mr. Ellis's argument that the 2005 issuance date was not determinative because relevant events, including renewals and amendments to the Policy and the assertion and processing of his disability claim, occurred after 2008.

         In again arguing that 2005 is not the determinative date in analyzing the applicability of §10-3-1116(2), Mr. Ellis focuses on amendments to the Policy which he made cursory reference to in his original briefing and a Summary Plan Description (“SPD”) for Comcast's Disability Plan that was not part of the administrative record. With respect to amendments, Mr. Ellis cites footers on several pages of the Policy to demonstrate that portions of the Policy were amended subsequent to the 2005 issuance date, most notably in 2011. See Doc # 52, pp. 16, 17, 18, 21, 22, 31 & 32. The cited pages do not include the General Provisions section of the Policy which contains the discretionary authority provision that Liberty relies on for application of an arbitrary and capricious standard of review. In fact, this section of the Policy does not reference any effective date, either 2005 or any subsequent year. See Doc # 52, pp. 41-5. Liberty, however, bears the burden of establishing that the arbitrary and capricious standard of review is applicable in this case. LaAsmar v. Phelps Dodge Corp. Life, Accidental Death & Dismemberment and Dependent Life Ins. Plan, 605 F.3d 789, 796 (10th Cir. 2010).

         Liberty has failed to provide any evidence to rebut Mr. Ellis's argument that the Policy has been amended several times. Liberty has also failed to cite any legal authority to rebut Mr. Ellis's argument that these amendments take this case out of the purview of Johnson v. Life Ins. Co. of North Amer., 2017 WL 1154027 at *11-*13 (D. Colo. Mar. 28, 2017) and Mustain-Wood v. Nw. Mut. Life Ins. Co., 938 F.Supp.2d 1081, 1084-85 (D. Colo. 2013), which informed my analysis of the retroactivity of § 10-3-1116(2) in the Order. Since both Johnson and Mustain-Wood dealt solely with policy renewals, I no longer find them persuasive authority for my analysis of this issue.

         In addition, the SPD submitted by Mr. Ellis with his motion provides as follows:

This [Plan] is effective January 1, 2011 and is established by [Comcast] to provide both short-term disability and long-term disability benefits to its eligible employees. It is the successor plan to the previously maintained Short-Term Disability Plan and Long-Term Disability Plan.

See Ex. 1 to Motion, p.2. Liberty argues that I should not even consider the SPD because it was not part of the administrative record before the Court. As Mr. Ellis points out, however, Liberty was responsible for compiling the administrative record to be reviewed by the Court (see Doc #70, p.2) and owed a fiduciary duty to him to ensure that he received any benefits to which he was entitled. See Gaither v. Aetna Life Ins. Co., 394 F.3d 792, 807-08 (10th Cir. 2004). Asking the Court not to consider information known to it that is relevant to Mr. Ellis's claim for long term disability runs counter to the duty that Liberty owes Mr. Ellis. I therefore reject Liberty's request that I strike the SPD from consideration.

         Liberty also argues that it should not be bound by the SPD since it was prepared and issued by Comcast. Clearly though, the SPD and the Policy are related. See Exhibit 1 to Motion, p. 2 (“... benefits which are insured are provided through a contract of insurance...”). Furthermore, Mr. Ellis's claim for long term disability benefits arises out of his participation in Comcast's Disability Plan which, per the SPD, went into effect in 2011, or ...