Zurawin v. UNUM Life Ins. Co. of Am.

ROBERT ZURAWIN, M.D., Plaintiff, v. UNUM LIFE INSURANCE COMPANY OF AMERICA, Defendant.

CIVIL ACTION NO. 4:19-cv-1162

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION

August 27, 2020

MEMORANDUM AND RECOMMENDATION

The parties in this case dispute whether Plaintiff Dr. Robert Zurawin is entitled to benefits under Baylor College of Medicine's group disability insurance policy administered by Defendant Unum Life Insurance Company of America (Unum). Unum filed a Motion for Summary Judgment or, Alternatively, for Judgment Under Rule 52 (Dkt. 18) and Plaintiff filed a Motion for Summary Judgment (Dkt. 20).¹ Having considered the parties' written submissions, the administrative record, and the law, the Court recommends that Unum's Motion for Judgment Under Rule 52 be GRANTED and this case be DISMISSED with prejudice.

I. Standard of Review

This case is governed by the Employment Retirement Income Security Act of 1974, 29 U.S.C. § 1001, et seq. (ERISA). The parties agree that the Court should decide this case on the written submissions of the parties based on a de novo review of the administrative record. Dkt. 10; Dkt. 18 at 6; Dkt. 20 at 8; Ariana M. v. Humana Health Plan of Texas, Inc., 884 F.3d 246 (5^th Cir. 2018) (en banc) (review of denial of benefits decision is governed by de novo standard of review rather than abuse of discretion). Under a de novo standard of review, the Court's task is to determine whether the administrator made a correct decision. Pike v. Hartford life and Acc. Ins. Co., 368 F. Supp.3d 1018, 1030 (E.D. Tex. 2019); Ingerson v. Principal Life Ins. Co., Civil Action No. 2:18-cv-227-Z-BR, 2020 WL 3163074, *8 (N.D. Tex. May 13, 2020). It remains thePlaintiff's burden to show by a preponderance of the evidence that he is entitled to benefits. Id.

The Fifth Circuit recently acknowledged "there is an open question whether it is appropriate to resolve ERISA claims subject to de novo review on summary judgment, or whether the district court should conduct a bench trial." Katherine P. v. Humana Health Plan, Inc., 959 F.3d 206, 208 (5^th Cir. 2020). The Fifth Circuit declined to answer the open question because the parties did not raise it, but reversed entry of summary judgment for the defendant and remanded for further proceedings due to a genuine issue of material fact precluding summary judgment. As in Katherine P., the parties here consent to resolution on summary judgment, although Defendant has moved for judgment alternatively under Rule 52. However, Katherine P. instructs that is it not proper for the District Court to enter summary judgment under Rule 56 in an ERISA case subject to de novo review if the administrative record presents a genuine issue of material fact. See Koch v. Metro. Life Ins. Co., 425 F. Supp. 3d 741, 746-47 (N.D. Tex. 2019) (surveying authorities and concluding that summary judgment is not proper where the Court must conduct an independent review of the administrative record); Cf. Woods v. Riverbend County Club Inc., 320 F. Supp. 3d 901, 909-10 (S.D. Tex. 2019) (granting defendant's motion for summary judgment after de novo review because the fact issues raised by plaintiff were not dispositive).

The Court concludes that the appropriate way to resolve this dispute is by making findings of fact and conclusions of law consistent with Rule 52 based on the administrative record and briefing. See Ingerson, 2020 WL 3163074, at *1 n.3 (making recommended findings of fact and conclusions of law pursuant to Rule 52 where parties requested trial on the administrative record and briefing); O'Hara v. Nat'l Union Fire Ins. Co. of Pittsburgh, PA, 642 F.3d 110, 116 (2d Cir. 2011) (a trial on the papers followed by express findings of fact and conclusions of law under Rule 52 is appropriate where it is clear that the parties consent to a bench trial on the parties' submissions); Hill v. Hartford Life & Accident Ins. Co., 1:08-CV-0754-CC, 2009 WL 10664970, at *1 (N.D. Ga. Sept. 16, 2009) (treating plaintiff's summary judgment motion on his ERISAclaims as trial on the papers pursuant to Rule 52).

II. Findings of Fact Based on De Novo Review of Administrative Record²

For purposes of this Recommendation, the Court finds the following facts are established by the Administrative Record.³

The Group Policy

1. Defendant and Baylor were parties to Group Insurance Policy #586228-002 (Group Policy) with an effective date of January 1, 2003. A.R. 23.

2. Plaintiff worked for Baylor College of Medicine (Baylor) as an Associate Professor in Obstetrics and Gynecology. A.R. 444, 923. While employed by Baylor as an Associate Professor, Plaintiff was covered by the Group Policy. See A.R. 27, 554.

3. The Group Policy contains the following relevant provisions:

WHEN DOES YOUR COVERAGE END?

Your coverage under the policy of a plan ends on the earliest of:

- the date the policy or plan is canceled;

- the date you no longer are in an eligible group;

- the date your eligible group is no longer covered;

- the last day of the period for which you made any required contributions; or

- the last day you are in active employment except as provided under the covered layoff or leave of absence provision.

A.R. 36-37.

ONCE YOUR COVERAGE BEGINS, WHAT HAPPENS IF YOU ARE TEMPORARILY NOT WORKING?

If you are on a leave of absence in accordance with your Employer's Human Resources policy, and if premium is paid by you, you will be covered up to but not exceeding 1 year.

A.R. 36.

DOES YOUR EMPLOYER ACT AS YOUR AGENT OR UNUM'S AGENT?

For purposes of the policy, your Employer acts on its own behalf or as your agent. Under no circumstances will your Employer be deemed the agent of Unum.

A.R. 38.

WHAT INSURANCE IS AVAILABLE IF YOU END EMPLOYMENT? (Conversion)

If you end employment with your Employer, your coverage under the plan will end. You may be eligible to purchase insurance under Unum's group conversion policy.

* * *

Unum will determine the coverage you will have under the conversion policy. The conversion policy may not be the same coverage we offered you under your Employer's group plan.

You are not eligible to apply for coverage under Unum's group conversion policy if:

* * *

- You are disabled under the terms of the plan;

* * *

- You are on a leave of absence;

A.R. 48.

4. The Group Policy provides the following definitions:

ACTIVE EMPLOYMENT means you are working for your Employer for earnings that are paid regularly and that you are performing the material and substantial duties of your regular occupation. Your work site must be: your Employer's usual place of business; an alternative work site at the direction of your Employer,. . . or a location to which your job requires you to travel.

EMPLOYEE means a person who is in active employment in the United States with the Employer.

EMPLOYER means the Policyholder, and includes any division, subsidiary or affiliated company named in the policy.

LAYOFF or LEAVE OF ABSENCE means that you are temporarily absent from active employment for a period of time that has been agreed to in advance in writing by your Employer.

A.R. 53-54.

The Settlement Agreement Between Plaintiff and Baylor

5. On February 18, 2015, as the result of a mediation that occurred in December 2014, Plaintiff signed a Settlement Agreement with Baylor. A.R. 923-33.

6. Unum was not a party to the Settlement Agreement. See id.

7. As part of the Settlement Agreement, Plaintiff agreed to provide, and Baylor agreed to accept, Plaintiff's voluntary resignation which would be effective as of February 8, 2015. A.R. 923, 926.

8. Baylor agreed in the Settlement Agreement to note in its HRIS database that Plaintiff retained a "voluntary faculty position" for 18 months after the resignation date or until he obtained another faculty position. The voluntary faculty appointment did not include "any teaching responsibilities or duties." A.R. 923.

9. Baylor agreed to pay Plaintiff through January 28, 2015 and to pay Plaintiff a lump sum settlement. A.R. 924.

10. Baylor agreed to provide Plaintiff COBRA group health, dental insurance, and standard disability benefits "the same as the benefits afforded under his plan coverage in effect immediately prior to his resignation" for up to 18 months from the resignation date. Id.

11. Plaintiff waived any right to reinstatement, future employment or independent contractor work with Baylor after the effective date of the Settlement Agreement. A.R. 927.

12. In the Settlement Agreement Plaintiff agreed that in the event he should inadvertently seek employment at Baylor College of Medicine (as opposed to an affiliate), he would upon notification, immediately withdraw any application for employment. He also agreed that Baylor shall have no obligation to consider his application for employment or hire him for any position that becomes available at Baylor. A.R. 926-27.

13. The Settlement Agreement contains a merger clause providing that it embodies the entire agreement between the parties. A.R. 931.

Plaintiff's claim for disability under the Group Policy

14. Plaintiff submitted a claim for long term disability benefits to Defendant on August 3, 2016 asserting difficulties communicating with patients and in surgeries. The claim identified his employer as Baylor College of Medicine and his last day worked as December 22, 2015. A.R. 98-103.

15. In subsequent phone calls, Plaintiff confirmed he last worked for Baylor in February 2015 but worked in private practice from May 2015 until December 2015. A.R. 273, 393.

16. After receiving the claim, Defendant asked Plaintiff to submit an Employer and Attending Physician form. A.R. 112.

17. Notes from an August 10, 2016 telephone call between Plaintiff and an Unum representative state that Plaintiff told the representative he left Baylor in February 2015, but Baylor was supposed to pay LTD (Long Term Disability) premiums for 18 months. A.R. 115.

Defendant's agreement with Baylor to retroactively convert Plaintiff's disability policy

18. After Plaintiff filed his disability claim, Baylor

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