Tuttle v. Cigna Grp. Ins.

WILLIAM F. TUTTLE PLAINTIFF v. CIGNA GROUP INSURANCE, CIGNA CORPORATION and LIFE INSURANCE COMPANY OF NORTH AMERICA DEFENDANTS

CAUSE NO. 1:10CV202-LG-RHW

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF MISSISSIPPI SOUTHERN DIVISION

Dated: April 4, 2012

AMENDED MEMORANDUM OPINION AND ORDER GRANTING

DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

THIS ORDER supplants and replaces the Court's Memorandum Opinion and Order [68] Granting the Motion for Summary Judgment [55] filed by Defendants CIGNA Group Insurance ("CIGNA Group"), CIGNA Corporation ("CIGNA Corp."), and Life Insurance Company of North America ("LINA"). In accordance with the Order [70] granting in part the Motion for Reconsideration filed by Plaintiff William F. Tuttle ("Tuttle"), the Court amends its Memorandum Opinion and Order as follows.

FACTUAL AND PROCEDURAL BACKGROUND

Tuttle filed this action in the Circuit Court of Jackson County, Mississippi. Defendants CIGNA Group, CIGNA Corp., and LINA removed the lawsuit to this Court on the basis of federal question jurisdiction. The Complaint alleges that Tuttle was insured under an ERISA plan that provided long term disability insurance "issued by Life Insurance Company of North America, CIGNA Group Insurance and/or CIGNA Corporation." (Compl. at 1 (¶I)). Tuttle claims that Defendants improperly processed his claim and improperly denied him benefits.

Tuttle was employed from 1991 through 2000 at Lockheed Martin Corporation in Mississippi as a senior systems engineer. He was responsible for installing the computer systems aboard the military ships constructed by Lockheed Martin. He participated in its health plan, which included disability insurance. LINA, a subsidiary of CIGNA, issued the insurance and administered the plan. (See Defs.' Ex. A, ECF No. 56-1; Defs.' Ex. B, ECF No. 56-2; A.R. Part 1, 54-77, ECF No. 63-1).

Tuttle first became disabled in September of 2000 when he developed what would later be diagnosed as osteomyelitis in his left hip. For this he was granted short term disability benefits, because he was unable to perform his occupation, which included climbing up and down ladders and stairs aboard ships. He subsequently suffered from concurrent health problems including cervical and lumbar radiculopathy, two heart attacks, and avascular necrosis in his left knee. Tuttle also underwent a total hip arthroplasty.

LINA granted Tuttle long-term disability benefits in March 2001. Under the policy, long-term disability benefits based on an inability to perform one's own occupation were available for a maximum of 180 days. According to the policy, in order to receive long-term disability benefits after the 180 day period, Tuttle would have to be unable to perform any occupation. (See Defs.' Ex. A 39, ECF No. 56-1). LINA approved continued long-term disability benefits after the 180-day period expired, but, as discussed below, it eventually terminated those benefits in 2004.

At LINA's direction, Tuttle underwent a Functional Capacity Exam (FCE) inJanuary 2004. (See A.R. Part 3, 73, ECF No. 63-3; A.R. Part 4, 1-10, ECF No. 63-4). The FCE results showed that while Tuttle should not return to his previous occupation, he had "demonstrated the ability to perform work in the sedentary physical demand category." (Defs.' Ex. A 45, ECF No. 56-1; A.R. Part 4, 1, ECF No. 63-4; see also A.R. Part 4, 5, ECF No. 63-4). The FCE summary concluded that Tuttle was "capable of performing desk bound functions with the ability of change of position," but in order for that to occur, Tuttle would "have to be cleared from a cardiac status." (Defs.' Ex. A 46, ECF No. 56-1; A.R. Part 4, 3, ECF No. 63-4).

LINA forwarded a copy of the FCE report to Dr. Manoj Shah, Tuttle's treating cardiologist, seeking his opinion and specifically asked whether he disagreed with the report. (A.R. Part 4, 12-13, ECF No. 63-4). Dr. Shah and Jim Savage, the Cardiac Rehab Director, responded and informed LINA that "Mr. Tuttle's exercise program is in the maintenance phase . . . [it] constitutes a total workout time of 70-80 minutes. His overall functional capacity is between 7-8 METS." (A.R. Part 3, 65, ECF No. 63-3). LINA considered Dr. Shah's response to the FCE to be a confirmation that Tuttle was capable of sedentary work. (See A.R. Part 1, 40-41, ECF No. 63-1).

A rehabilitation specialist completed a Transferable Skills Analysis (TSA) based on the results of Tuttle's FCE, and identified five "suitable sedentary occupations" in the Ocean Springs, Mississippi labor market that met Tuttle's "skills, education, work history, and wage replacement requirements." (A.R. Part 4, 28, ECF No. 63-4). These occupations would allow Tuttle to alternate his positionsbetween "sitting, standing, and walking at his discretion throughout the day." (A.R. Part 4, 28, ECF No. 63-4).

LINA terminated Tuttle's benefits effective June 2004 based on its finding that, while he was still disabled in terms of his own occupation, he was no longer disabled in terms of all other occupations. (See Defs.' Ex. A 28-32, ECF No. 56-1; A.R. Part 3, 67-71, ECF No. 63-3). LINA informed Tuttle of the denial of his benefits in a letter dated July 7, 2004. The letter indicated that LINA had reviewed Tuttle's medical records from Dr. Shah, his treating cardiologist, and that the results of the FCE performed in January 2004 indicated that Tuttle was capable of sedentary work and a number of other activities. (Defs.' Ex. A 29, ECF No. 56-1). The letter further stated that LINA had submitted the results of the FCE to Dr. Shah for his review, and that he had "not submitted any medical documentation to contradict [its] findings." (Id.). LINA also noted that a TSA had been compiled based on the results of Tuttle's FCE, and the TSA identified five occupations Tuttle was capable of performing in his local labor market. (Id.). It also informed Tuttle of his appeal rights.

Tuttle appealed the decision to discontinue his benefits, but LINA affirmed the denial on February 22, 2005. (Defs.' Ex. A 80, ECF No. 56-1). LINA's February 2005 letter to Tuttle explained the reasons for the denial of his appeal, and indicated that his "entire claim file was thoroughly reviewed, along with the additional information received for the appeal of [his] claim." (Id.). LINA also informed Tuttle that all of his medical evidence was referred to a physician boardcertified in Internal Medicine and Occupational Medicine for an independent review. (Id. ). According to the independent physician's review, Tuttle had "more than enough cardiac reserves in order to be able to perform a sedentary occupation," and that the "available test on file indicate[s] [his] functional capacity to be 7-8 METS." (Id. at 80-81). LINA further noted that Tuttle had been released to return to light duty work in 2001, an MRI in 2003 "showed no recurrent HNP," and that, with respect to his "diagnosis of necrosis of the left hip [he was] released to full weight bearing without the use of a cane or walker in October 2002." (Id. at 81).

LINA reiterated that in order to be entitled to long-term disability benefits, he must be considered totally disabled and unable to perform any occupation. LINA noted that the TSA performed in 2004 had indicated five occupations Tuttle was capable of performing. Therefore, Tuttle did not meet the definition of total disability under the policy, and his benefits were denied. (Defs.' Ex. A 81, ECF No. 56-1.)

Tuttle filed a second appeal on August 17, 2005. He was given more time to provide any further proof of disability. He did so and indicated he would be sending updated records from his cardiologist. Almost two years later, on April 5, 2007, Defendants sent a letter that they never received the cardiologist records. (A.R. Part 1, 52, ECF No. 63-1). Tuttle filed this lawsuit three years later, on April 5, 2010.

DISCUSSION

The Statute of Limitations

The Defendants argue the statute of limitations has run. Tuttle responds that the limitations period was equitably tolled until April 5, 2007, based on Defendants' misrepresentations. Before reaching the merits of the claims, the Court examines whether Tuttle's claims were timely filed.

Defendants bear the burden of proof on this affirmative defense; therefore they "must establish 'beyond all peradventure all of the essential elements of the . . . defense'" in order to obtain summary judgment. Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986). An ERISA cause of action for wrongful denial of benefits "accrues when a request for benefits is denied." Hogan v. Kraft Foods, Inc., 969 F.2d 142, 145 (5th Cir. 1992). The discovery rule applies. Lawrence v. Jackson Mack Sales, 837 F. Supp. 771, 781 (S.D. Miss. 1992). The parties may contract for a different limitations period, so long as it is reasonable. Harris Methodist Fort Worth v. Sales Support Servs., Inc., Emp. Health Care Plan, 426 F.3d 330, 337 (5th Cir. 20005). Some courts hold that a policy that sets an accrual date before the denial of a claim is unreasonable per se. White v. Sun Life Assurance Co., 488 F.3d 240, 242 (4th Cir. 2007), cert. denied 128 S. Ct. 619 (2007). See also, Amos v. Hartford Life & Accident Ins. Co., No. CV-08-BE-2165-M, 2009 WL 1804989 (N.D. Ala. June 24, 2009); Island View Residential Treatment Ctr., Inc. v. Bluecross Blueshield of Mass., Inc., No. 07-10581-DPW, 2007 WL 4589335, *13-14 (D. Mass.Dec. 28, 2007). The Eighth Circuit has applied the accrual date under federal common law even though the policy provided a different date. Wilkins v. Hartford Life & Accident Ins. Co., 299 F.3d 945, 948-49 (8th Cir. 2002). Other courts examine the reasonableness of a contractual accrual date on a case by case basis. Rice v. Jefferson Pilot Fin. Ins. Co., 578 F.3d 450, 455 (6th Cir. 2009); Burke v. PricewaterhouseCoopers, LLP, Long Term Disability Plan, 572 F.3d 76, 81 (2d Cir. 2009); Abena v. Metro. Life Ins. Co., 544 F.3d 880, 884 (7th Cir. 2008). The Fifth Circuit has not yet determined which...