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Miller v. PNC Financial Services, Inc. Affiliates Long Term Disability Plan

On October 2, 2017, the U.S. District Court for the Southern District of Florida issued an opinion ruling in favor of Plaintiff, Wendy Miller, who was represented by this firm.

Ms. Miller suffers from degenerative disc disease which causes chronic back pain that radiates into her hips and legs (known as radiculopathy). Since 2009, Ms. Miller has undergone five surgical procedures in an attempt to alleviate her chronic pain and radiculopathy. In April 2015, Ms. Miller underwent the most recent of these surgical procedures, in which she had a neurostimulator implanted. After this implant, Ms. Miller was unable to return to work and filed a claim for long-term disability benefits with the claims administrator for her plan – Liberty Life Assurance Company (“Liberty”).

Liberty initially approved Ms. Miller’s claim and began paying benefits, but in January 2016, Liberty terminated her benefits. Ms. Miller filed an appeal, submitting substantial evidence of continued disability, but Liberty denied her appeal and upheld their decision to terminate benefits. Accordingly, Ms. Miller brought suit in federal court.

A key legal issue to be determined by the Court was what standard of review would be applied to Liberty’s decision. Ms. Miller argued that Liberty’s termination should be reviewed under the default de novo standard because the plan document (here a Summary Plan Description, or “SPD”) failed to expressly and unambiguously grant Liberty discretion to make final benefits decisions. Defendants argued that the SPD and a separate document, an Administrative Services Agreement between Liberty and PNC Financial Services, Inc. (“PNC”- Ms. Miller’s former employer and the Plan Administrator), contained the requisite language for an abuse of discretion review.

The Court agreed with Ms. Miller and reviewed Liberty’s termination under a de novo standard. The Court found that the language in the SPD, which stated simply that any court review “shall be limited to a determination of whether the decision was arbitrary and capricious” was insufficient. The Court held that there was no authority allowing an ERISA plan to “merely stipulate to an abuse of discretion review without also conferring discretionary authority to an administrator or fiduciary.”

Furthermore, the Court agreed with Ms. Miller that, although the plan document granted discretion to PNC, PNC failed to properly delegate that discretion to the true decision maker – Liberty. In doing so, the Court rejected PNC’s attempt to rely on the ASA for such a delegation. The Court found first, that a contract, not mentioned in the plan document cannot confer discretion. Second, the Court found that PNC’s alleged delegation in the ASA was not a complete delegation of authority, and thus, would not have been sufficient even if the ASA were considered a plan document.

In completing its de novo review the Court stood in the shoes of Liberty and walked through Ms. Miller’s medical evidence. Ultimately, the Court determined that it would not have terminated Ms. Miller’s benefits under the circumstances and that Liberty’s decision to do so was wrong.

Accordingly, the Court awarded Ms. Miller past-due benefits, plus interest and reversed Liberty’s termination.