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Scott v. Union Security Insurance Co.

United States District Court, D. Kansas

February 5, 2019

ANDREW SCOTT, Plaintiff,
v.
UNION SECURITY INSURANCE COMPANY, Defendant.

          MEMORANDUM AND ORDER

          John W. Lungstrum United States District Judge

         Defendant insurer denied plaintiff long-term disability benefits, and plaintiff now asserts claims under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132(a). This matter presently comes before the Court on the cross-motions for summary judgment filed by plaintiff (Doc. # 36) and defendant (Doc. # 34). For the reasons set forth below, the Court concludes that summary judgment is warranted in favor of defendant on plaintiff's claims. Accordingly, the Court grants defendant's motion and denies plaintiff's motion.

         I. Background

         The following facts are undisputed. Plaintiff worked as an orthopedic surgeon specializing in sports medicine. Plaintiff's employer provided a long-term disability plan though a policy from defendant insurer. The Plan contained the following provisions relevant to this case:

         Disability or disabled means that in a particular month, you satisfy one or more of the three Tests, as described below.

         Occupation Test

• During the first 36 months of a period of disability . . ., an injury . . . prevents you from performing at least one of the material duties of your regular occupation; and
• after 36 months of disability, an injury . . . prevents you from performing at least one of the material duties of each gainful occupation for which your education, training, and experience qualifies you.

         Earnings Test

You may be considered disabled in any month in which you are actually working, if an injury . . . prevents you from earning more than 80% of your monthly pay in that month in any occupation for which your education, training or experience qualifies you. . . .
. . .
You may still be considered disabled according to the Occupation Test, without regard to your level of current earnings, if you meet the requirements of that Test.
[Third Test not applicable here.]
. . .
Gainful occupation means an occupation in which you could reasonably be expected to earn at least as much as your Schedule Amount [in this case $6, 000 per month].

         Plaintiff ceased working as a surgeon for his employer in October 2012 because of a shoulder rotator cuff injury, for which he had surgery. In February 2013, defendant notified plaintiff that it approved his claim for benefits under the plan, with a disability onset date of October 9, 2012, with benefits to commence in April 2013 pursuant to the Plan, with a maximum duration until April 2023 (assuming plaintiff continued to satisfy the terms of the Plan). This letter also noted that the definition of disability would change after 36 months and that an investigation would take place to determine whether plaintiff met the disability definition at that time.

         In 2015, as the change-in-definition approached, defendant undertook an investigation of plaintiff's continuing eligibility for benefits. Defendant's medical review, based on a 2013 evaluation from plaintiff's surgeon, Dr. Burkhart, concluded that while plaintiff could not perform his own occupation, he could work full-time with light duty above the waist, with no other restrictions or limitations. Defendant completed a transferable skills analysis (TSA) and obtained a labor market study (LMS), which revealed four positions in the geographical area that plaintiff could perform, for which he was qualified, in which he could earn as much as his Schedule Amount (meaning such positions would be considered “gainful occupations” under the Plan). Defendant asked plaintiff if he was working, and plaintiff responded that he was considering a consulting engagement. On September 30, 2015, plaintiff notified defendant that he was starting work at a Culver's restaurant, as a front-line crew member, at a wage of $8.50 per hour. Plaintiff conceded during the claims process that he took that job in order to meet the Earnings Test of the Plan's disability definition.

         On November 5, 2015, defendant sent plaintiff a letter concerning his eligibility for benefits after the change-in-definition after 36 months. The letter accurately quoted the Occupation Test and Earnings Test from the Plan, but it did not quote the introductory language stating that a participant had to satisfy only one test to meet the disability definition. The letter then stated as follows:

As of October 9, 2015 you have been disabled for 36 months. You must satisfy both the Occupation Test and the Earnings Test to receive further disability benefits.
After reviewing all of the medical, financial, and vocational evidence in your file we have determined that you currently remain disabled as defined by the policy and are entitled to benefits.

         The letter also notified plaintiff that it would continue to request updated information “to substantiate ongoing entitlement to disability benefits and to confirm the accuracy of the benefit paid;” that plaintiff should inform it if he returned to work or had a change in medical condition; and that he remained eligible until April 2023 as long as he remained disabled and satisfied the provisions of the Plan.

         In March 2016, plaintiff left his Culver's job and took full-time employment as a medical officer with the FDA in Washington DC, at an annual salary of $197, 000. In April 2016, after approximately one month, plaintiff left his employment with the FDA because he no longer desired to be employed so far from ...


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