Dist. Ct. erred in granting plaintiff-insured’s motion for summary judgment in action under ERISA, seeking declaration that plaintiff was entitled to larger monthly disability benefit under defendant’s group long-term disability insurance policy, under circumstances where plaintiff had heart attack on August 31, 2014 and suffered series of daily physical setbacks that required daily hospitalizations that led up to plaintiff’s application for disability benefits. While plaintiff asserted that start date for his disability was sometime after September 1, 2014, when he received raise in salary that would translate into higher disability benefit, defendant determined that plaintiff was entitled to only lower benefit because onset of his disability started on August 31, 2014, when he incurred his heart attack. Dist. Ct. agreed with plaintiff based, in part, on “active work” definition in policy that suggested that plaintiff could not have become disabled until sometime after September 2, 2014, due to Labor Day holiday that occurred on September 1, 2014 and due to fact that plaintiff was at work on August 31, 2014. Ct. of Appeals, though, found that defendant’s plan administer's contrary interpretation of policy language was entitled to deference and was only subject to stringent arbitrary and capricious review standard, where policy granted to plan administrator discretionary authority to administrate plaintiff’s claim. Moreover, administrator’s construction of policy was not arbitrary and fell within range of reasonable interpretations, where record showed that following his heart attack, plaintiff reviewed and responded to certain work-related emails, but did not perform full duties of his occupation up to date of his application.
Federal 7th Circuit Court
Civil Court
ERISA