This month’s Friday Five covers cases relating to: a court’s decision to hold an evidentiary hearing where factual disputes precluded summary judgment; dismissal of a claim for life insurance benefits of an ex-spouse who became ineligible for coverage upon divorce; an analysis of reasonable attorney’s fees; whether a claimant is entitled to a copy of the documents relied upon by the insurer in making a benefits decision before the final decision is issued; and an analysis of discovery beyond the administrative record.

1. Court holds that an evidentiary hearing was necessary to resolve case where conflicting medical evidence precluded the court from making decision at summary judgment under de novo review. In Forman, the court ruled that a de novo standard of review applied to the insurer’s denial of LTD benefits, but the court held that an evidentiary hearing was necessary to resolve the case because the record contained conflicting medical opinions that precluded summary judgment. The insurer’s Summary Plan Document (“SPD”) summarizing the coverage under the LTD Policy granted discretion to the insurer to make benefits determinations. However, the LTD Policy was silent regarding discretionary authority, and the court held that de novo review applied. The court also held that the record contained conflicting evidence as to whether the plaintiff could fly long distances, including international travel, which was a material responsibility of the plaintiff’s occupation. The court observed that, “[i]n conducting a de novo review, a district court may not resolve factual disputes at the summary judgment stage.” Accordingly, the court denied the parties’ cross-motions for summary judgment and scheduled an evidentiary hearing to resolve the case. Forman v. First Unum Life Ins. Co., No. 5:19-CV-02756-JDW, 2020 WL 3498113 (E.D. Pa. June 29, 2020).
2. Court grants motion to dismiss in favor of insurer and employer regarding claimant’s ex-spouse’s life insurance eligibility. In Staropoli, the plaintiff brought claims against MetLife and her employer, JPMorgan Chase Bank, for denial of life insurance benefits and breach of fiduciary duty. The plaintiff had enrolled her former husband in a group life insurance policy originally issued through another insurer. In 2013, the plaintiff and her husband divorced, of which she provided notice to JPMorgan. In 2017, MetLife became the issuer and claims administrator for the policy. The former husband passed away in 2018, after which the plaintiff filed a claim for benefits on behalf of her children. MetLife denied the claim for death benefits because the policy stated that ex-spouses were not eligible for coverage. The plaintiff alleged, among other things, that (1) she had continued to pay premiums under the belief that coverage existed, (2) neither JPMorgan nor MetLife ever advised her of any coverage issues, and (3) JPMorgan’s computer network had indicated that her children were the beneficiaries. At the outset, the court dismissed all claims against JPMorgan because it was not the plan administrator and it did not have authority to grant or deny claims or determine eligibility. The court also dismissed the plaintiff’s 502(a)(1)(B) claim for benefits against MetLife because the terms of the policy provided that the former husband ceased to be eligible for life insurance coverage upon divorce. Additionally, the court held that MetLife did not breach any fiduciary duties to the plaintiff because, among other things, MetLife did not become the claims administrator until years after the divorce and did not have knowledge of the divorce until it investigated the plaintiff’s claim for benefits. The court further held that the plaintiff failed to sufficiently plead an agency relationship between JPMorgan and MetLife, and JPMorgan’s knowledge of the divorce could therefore not be imputed to MetLife. Staropoli v. Metro. Life Ins. Co., No. CV 19-2850, 2020 WL 3051434 (E.D. Pa. June 8, 2020).
3. Court analyzes award and reduction of attorney’s fees. In McConnell, the plaintiff brought an ERISA action after the insurer, who had paid LTD benefits for roughly ten years, terminated benefits. After an unsuccessful settlement conference and briefing regarding the applicable standard of review, the insurer ultimately reinstated benefits. The parties agreed that the plaintiff’s counsel was entitled to an award of attorney’s fees and costs, but disputed the amount, and the plaintiff filed a motion for attorney’s fees and costs. The plaintiff’s counsel, whose office was in Pensacola, Florida, sought an award of $415/hour for partner hours and $275/hour for associate hours. The court held that, based on the local market in Alabama in which the court sits, the award would be reduced to $325/hour for partner hours and $200-$225/hour for associate hours. The court also made certain reductions in attorney fees relating to: (1) research performed by a partner that could have been performed by an associate, (2) attorney time spent calculating benefit present values, (3) time spent on the pre-litigation administrative proceeding, and (4) block billing and vague time entries. However, the court declined to make reductions for: (1) alleged premature discovery efforts, (2) amount of time spent performing legal research and writing, and (3) attendance of two attorneys for the plaintiff at the settlement conference. Ultimately, the court reduced the plaintiff’s requested award of roughly $145,000 to approximately $91,500. Additionally, the court awarded reduced fees in the amount of $5,400 relating to time spent preparing the plaintiff’s reply brief for the attorney’s fees motion. McConnell v. Am. Gen. Life Ins. Co., No. CV 19-0174-WS-MU, 2020 WL 3452983 (S.D. Ala. June 24, 2020).
4. Court holds that claimant is not entitled to a copy of the documents relied upon by the insurer in making an adverse benefit determination until after the insurer issues its decision. In Crites, the insurer terminated the plaintiff’s LTD benefits at the any occupation stage and upheld its decision on appeal. The insurer’s decision on appeal relied, in part, on a peer review by an independent specialist. The plaintiff argued that she did not receive full and fair review and that the insurer violated ERISA’s Claims Regulations by not allowing her to review and rebut the peer review report prior to issuing its final decision on administrative appeal. The court disagreed and held that the plaintiff was entitled to access the peer review only after the insurer made its adverse benefit determination. Crites v. Aetna Life Ins. Co., No. 4:19-CV-00098-KGB, 2020 WL 2616578 (E.D. Ark. May 21, 2020).
5. Court addresses permissible discovery beyond the administrative record in ERISA LTD case. In Hughes, the plaintiff filed a motion to compel a variety of discovery from Hartford Life and Accident Insurance Co. in an ERISA action for LTD benefits. Specifically, the plaintiff issued interrogatories and requests for production allegedly seeking to explore: (1) the completeness of Hartford’s administrative record, (2) Hartford’s alleged conflict of interest, (3) alleged bias on the part of Hartford’s medical consultants, and (4) Hartford’s compliance with Department of Labor regulations governing employee benefit plans. The plaintiff also requested an in camera review of one document that Hartford withheld on the basis of attorney-client privilege. Hartford sought a protective order quashing three document subpoenas that the plaintiff had served on Hartford’s medical consultants, without providing proper notice to Hartford under Fed. R. Civ. P. 45. The district court observed that “courts have developed two principal approaches” to analyzing extra-record discovery: (1) the “good cause” standard, and (2) the “reasonable chance” standard. The court adopted the “reasonable chance” standard whereby an ERISA plaintiff can obtain extra-record discovery to the extent that she shows, through facts and not conclusory allegations, a “reasonable chance” that the particular discovery request will yield a “good cause” for expanding the record at summary judgment or trial. Applying that standard, the court held that the plaintiff (1) supported one of her requests directed to the completeness of the administrative record, but not the others; (2) did not support her requests for discovery into Hartford’s alleged conflict; and (3) partially supported one of her requests directed to the alleged bias of Hartford’s medical consultants, but not the others. The court further held that the DOL regulations mandated production of some, but not all, of the requested documents relating to Hartford’s compliance with the regulations. The court also ordered Hartford to produce the allegedly privileged document for in camera review. However, the court granted Hartford’s motion for protective order regarding the third-party subpoenas. Hughes v. Hartford Life & Accident Ins. Co., No. 3:19-CV-01611-JAM, 2020 WL 2615531 (D. Conn. May 22, 2020).