“Melissa Gardner V. Ameritech Sickness And Accident Disability Plan”

“Melissa Gardner v. Ameritech Sickness and Accident Disability Plan”

2009 U.S. Dist. LEXIS 96065 (C.D. ILL., September 30, 2009)

Melissa Garner was an employee of an AT&T subsidiary, working as a Marketing Support Specialist. Her job consisted primarily of communicating with customers via telephone and coordinating the provision of various user- related services. She began experiencing aching-type back pain, sought medical treatment, and was diagnosed with degenerative disc disease at L3-L4, L4-L5, L5-S1 and central and annual tears at L3-L4, L5-S1 discs. Ultimately, her doctors recommend surgery, but her medical insurance carrier would not approve it, claiming that the surgery was experimental. In the meantime, Ms. Gardner’s claim for disability benefits were denied by AT&T’s third party administrator, Sedgwick Claims Management Services.

We appealed the denials of Ms. Gardner’s short term and long term disability claims. Sedgwick CMS denied both appeals. We then filed suit.
The only issue litigated in the lawsuit (which ultimately settled) was the standard review. In ERISA litigation, there are two possible standards of review: de novo or abuse of discretion. When review is for abuse of discretion, the court defers to the plan’s decision as long as it is reasonable. When review is for abuse of discretion, it is common for courts to sustain the plan’s or the insurance company’s denial of benefits, whether it is right or wrong, if it is reasonably based on substantial evidence. When review is de novo, the court gives credit to the plan’s or insurance company’s decision, but instead evaluates the claim on its own, and decides whether or not the claimant is in entitled to benefits.

Although the de novo reviewed does not guarantee that the claimant will prevail and abuse of discretion review does not guarantee that the insurance company or the plan will prevail, it is certainly easier for the claimant to prevail if review is de novo.

In Ms. Gardner’s case, the defendant, AT&T’s plan granted discretion to a internal benefits committee. The Plan claimed the benefits committee delegated discretion to Sedgwick CMS. We argued that since the delegation was not properly documented, review should be de novo; the Court agreed. Since the Court agreed that the review was de novo, the Court also authorized us to take depositions of the four doctors who evaluated Ms. Gardner’s records. Once we took those depositions we demonstrated that the doctors’ opinions were not well founded or consistent with established medical standards. The case ended in a settlement.