Sacks v. Standard Ins.Co., 2009 U.S.Dist.LEXIS 111331 (C.D.Cal. November 30, 2009)(Issue: Job versus Occupation).  Plaintiff, who had been a mortgage loan underwriter for Countrywide Financial, was diagnosed in 2001 with polyneuropathy and Charcot-Marie-Tooth (CMT) disease, an incurable progressive, degenerative impairment causing pain and affecting mobility.  Sacks’s condition worsened over time; by July 2007, at the age of 58, she had to cease working and submitted a claim to Standard Insurance Company.  Despite the support of several physicians, including a neurologist and physiatrist, Standard denied the claim based on a file review completed by Dr. Mark Shih. Sacks appealed, and submitted as part of her appeal a DVD she had made for a prosthetic specialist, who documented from his review of the video, that Plaintiff had mobility and balance problems.  Sacks also notified Standard she had been dropping objects due to weakness and numbness in her hands, and that she had difficulty concentrating.  Despite trying everything, including acupuncture, physical therapy, water aerobics, braces, canes, crutches, and even a faith healer, Sacks reported her condition had worsened.   

Upon receipt of the appeal, a nurse reviewed the file and reported there were no new medical records or information provided to support an inability to perform a sedentary occupation.  Another Standard physician, Janette Green, M.D., also reviewed the file, but despite acknowledging the mobility issues shown in the DVD footage, she concluded that there was no evidence supporting an inability to perform a sedentary occupation.  The file was also sent for review to Dr. Elias Dickerman, a neurologist employed by Standard.  Dr. Dickerman recognized that Sacks had difficulty with her lower extremities, with decrease in power of the peroneal nerves bilaterally; however, he concluded the lower extremity weakness could be “somewhat compensated” by the use of a brace or motorized scooter.  Dickerman also recommended an examination by a neuromuscular specialist and for electrodiagnostic testing to be performed. 

Dr. Dickerman was deposed.  In his deposition, he admitted he had worked as a medical consultant for Standard since March 2000 and was paid $235/hour in 2007 for his services.  In 2006 and 2007, Dickerman earned approximately $230,000 per year from Standard, and slightly less in 2008. 

Following Dr. Dickerman’s review, an examination of the plaintiff was performed which revealed only mild upper extremity difficulties, although the examiner, Dr. Wu, suggested further study.  Nor did Dr. Wu address whether Sacks could perform her job as an underwriter; he simply concluded, "Patient is still able to [sic] sedentary work provided with frequent breaks, safety precautions and good handicap access or measures." Although Dr. Wu’s reported noted Sacks’s complaints of drowsiness and diminished concentration due to medications, he found she was awake, alert and oriented and that she could discontinue use of Nortriptyline, although an alternative was not suggested.  The recommended follow-up testing was never requested or performed; instead, Dr. Dickerman reviewed the file again and concluded that no upper extremity impairments affected the plaintiff’s ability to perform a sedentary occupation.  Consequently, Standard upheld its determination. 

On consideration of the evidence, the court found Standard had discretion.  However, based on Montour v. Hartford Life & Accident Ins. Co., 2009 WL 3856933 (9th Cir. 2009) and Metro. Life Ins. Co. v. Glenn, 128 S.Ct. 2343, 2346, 2348, 171 L.Ed.2d 299 (2008), along with Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955 (9th Cir. 2006), the court found Standard’s conflict of interest to be a factor.  The court found that while Standard made some effort to achieve administration neutrality by hiring Dr. Wu, the insurer’s failure to follow up on his recommendation to order additional tests was evidence of a conflict – “Standard asked for Dr. Wu's evaluation in an open-ended and non-adversarial manner, but failed to follow up when the responses were incomplete in a way that assisted Standard's decision to deny benefits.” *38.  Thus, even though the plaintiff did not make a showing with respect to Standard’s rate of claim denials, the evidence relating to Dr. Dickerman was relevant in that he receives a significant amount of income each year from Standard.  Nor was there any showing that Standard took steps to mitigate its conflict.  The court then found the following factors evidenced its conflict: 

Standard's initial denial letter did not advise plaintiff what type of evidence to submit in support of her claim. (172.) If a claim is initially denied, an ERISA administrator is required to notify an insured of the specific information needed to support the claim. Saffon v. Wells Fargo, 522 F.3d 863, 870-71 (9th Cir. 2008). A request for "medical evidence" or "information which you believe is relevant" is insufficient. See id. The purpose of this requirement is to guarantee that an ERISA claimant is given the opportunity to submit evidence that the administrator deems relevant to prove the claim. See id.

Standard used erroneous occupational criteria to evaluate Plaintiff's claim. Instead of evaluating Plaintiff's ability to perform her "Own Occupation," which admittedly had cognitive requirements, Standard asked its examining physician to opine on Plaintiff's ability to perform "any sedentary occupation." (300.) When the independent physician Dr. Wu asked for permission to conduct further testing on Plaintiff's upper extremities, Standard refused, again repeating that it was only seeking an opinion as to whether plaintiff could perform "any sedentary occupation." (293.) Standard's own vocational case manager had concluded that Plaintiff's occupation required occasional reaching, handling, and fingering. (155-156.) It is error to evaluate a claimant's disability under the DOT exertional strengths of "sedentary, light, etc." when the relevant plan definition is the more generous "own occupation" criteria. See Gaither v. Aetna, 388 F.3d 759 (10th Cir. 2004); Mizzell v. Paul Revere Life Ins. Co., 118 F.Supp.2d 1016, 1022 (C.D. Cal. 2000). Standard's obstinate refusal to recognize this as an issue and its rejection of Plaintiff's generous offer before this Court to have the matter remanded to evaluate her claim under the "Own Occupation" test is further evidence of its bias.

Plaintiff advised Standard that the side effects of her medication made it difficult for her to work during the first half of the day. (163-164.) Standard clearly recognized that Plaintiff's medication had the potential of providing a disabling restriction, because it asked Dr. Wu whether the claimed side effects would restrict her ability to perform a "sedentary occupation." (236, 299.) Instead of answering the question, Dr. Wu merely concluded that Plaintiff could discontinue the medication that had been prescribed by her physician. (285.) Rather than returning to Dr. Wu for a specific response to the question it had asked, Standard adopted this recommendation in its claim denial. (332.) An administrator abuses its discretion when it fails to consider how the side effects of a claimant's medication impact the claimant's ability to perform her "own occupation." See Godfrey v. BellSouth Telecomms., Inc., 89 F.3d 755, 759 (11th Cir. 1996); Archuleta v. Reliance Standard Life Ins. Co., 504 F.Supp.2d 876, 886 (C.D. Cal. 2007);  Adams v. Prudential Ins. Co. of Am., 280 F.Supp.2d 731, 740 (N.D. Ohio 2003).

In the final decision on appeal, Standard acknowledged that Plaintiff's complaints of sedation were documented. (358.) However, Standard rejected this aspect of her claim because of an absence of information in the medical records to support impairment from sedation. There was "no evidence" regarding the sedation issue because Standard had requested an opinion from Dr. Wu on the issue, who did not answer the question. Instead of returning to Plaintiff's physicians or Dr. Wu, Standard just denied the claim. This violates an administrator's duty to fully investigate a claim. If an administrator requires information to evaluate a claim, it must ask for it. It is not free to reject the claim merely because of an absence of information. Saffon v. Wells Fargo & Co. Long Term Disability Plan, 522 F.3d 863, 870 (9th Cir. 2008).

At least some of the medical reviews were based on incomplete records. Drs. Shih and Green conducted their medical reviews without the majority of Plaintiff's medical records and without the benefit of her job description. Dr. Dickerman did not know the cognitive demands of the DOT job description for an Underwriter. (Chandler Decl., Ex. A, p. 35.) It is not clear whether Dr. Wu was given all of Plaintiff's medical records. Supplying incomplete information to medical or vocational experts is a matter of "serious concern," MetLife II, 128 S.Ct. at 2352, and is certainly one of the case-specific factors to be considered in evaluating the weight to give to a structural conflict. See Montour, 2009 WL 3856933 at *9-10 (providing a nonexclusive list of considerations). *39-*44. 

Although the plaintiff had worked with her condition, the court found that should not have been given significant weight by Standard since her condition worsened and the progression of the disease was documented in the medical records.  Moreover, Standard never properly considered the plaintiff’s occupation which required standing and walking as material job duties.  Because Sacks could not stand or walk without assistance and pain, the court concluded she could not perform her occupation.  The court also found the complaints of pain and fatigue were well documented and credible in view of her struggle to remain employed despite the progression of her disease.  Consequently, the court ordered the payment of benefits and fees.

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