Hilton v. Ashland Oil Inc ( 1996 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 96-40100
(Summary Calendar)
TERRY HILTON,
Plaintiff-Appellee/
Cross-Appellant,
versus
ASHLAND OIL INC,
Long-Term Disability Plan
for Scurlock Permian Drivers
and Hourly Paid Employees,
Defendant-Appellant/
Cross-Appellee.
Appeal from the United States District Court
for the Eastern District of Texas
(6:94-CV-754)
November 11, 1996
Before HIGGINBOTHAM, WIENER and BENAVIDES, Circuit Judges.
PER CURIAM:*
Defendant-Appellant, the Long-Term Disability Plan for Permian
*
Pursuant to Local Rule 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in Local Rule 47.5.4.
Drivers and Hourly Paid Employees (the Plan), appeals the judgment
rendered by the district court following a bench trial, reversing
the decision of the Plan’s administrator that Plaintiff-Appellant
Terry Hilton was not qualified to receive long-term disability
benefits under the Plan.1 As Cross-Appellant, Hilton appeals the
the district court’s rulings that (1) the plan administrator
correctly interpreted the appeal provisions of the Plan, and
(2) Hilton is not entitled to attorneys’ fees because the plan
administrator had not acted in bad faith in denying long-term
disability benefits to Hilton.
Our review convinces us that, even though the district court
correctly identified “abuse of discretion” as the appropriate
standard for the court to apply when reviewing determinations of a
plan administrator vested with discretion, the district court’s
reasoning, as fully set forth in its opinion, reveals that the
court in fact tested the plan administrator’s decision not for
abuse of discretion but for clear error. That opinion also reveals
that, by requiring the plan administrator to prove that Hilton was
not disabled, the court impermissibly reversed the burden of proof,
which should have been Hilton’s to prove that he is disabled for
purposes of entitlement to benefits under the Plan, not the Plan’s
1
The district court did not conclude, however, that the
evidence was sufficient to determine, as a matter of law, that the
Plan’s terms required the granting of benefits to Hilton, so the
court remanded the case to the plan administrator with instructions
to take and consider additional evidence.
2
to prove that he is not. We therefore reverse the judgment of the
district court to the extent it held that the plan administrator
abused its discretion in concluding that Hilton had not shown that
he came within the Plan’s definition of disability. As a result of
our reversal, we must reinstate the determination of the plan
administrator to deny long-term disability benefits to Hilton. We
affirm, however, the judgment of the district court to the extent
it rejected (1) Hilton’s complaint regarding the Plan
administrator’s interpretation of the appeal provisions of the
Plan, and (2) Hilton’s request for attorneys’ fees.
I
FACTS AND PROCEEDINGS
A. Statement of the Case
Hilton filed suit in district court under ERISA2 to recover
long-term disability benefits from the Plan, which is an ERISA
employee welfare benefit plan. The case was tried to the court
without a jury and produced a judgment in favor of Hilton. In
essence, that judgment vacated the plan administrator’s denial of
long-term disability benefits to Hilton as an abuse of discretion,
but rejected Hilton’s claims (1) that the plan administrator had
misinterpreted and misapplied the reconsideration (appeal)
provisions of the Plan, and (2) that Hilton was entitled to
attorneys’ fees. Rather than rendering a judgment ordering the
2
Employer Retirement Income Security Act (“ERISA”),
29 U.S.C. § 1132(a)(1)(B).
3
Plan to pay benefits to Hilton, however, the court remanded the
case to the plan administrator with instructions to take additional
evidence. The Plan timely appealed the reversal of the
administrator’s determination and the remand for the taking of
further evidence, and Hilton cross-appealed the court’s rejection
of his claims regarding attorneys’ fees and misinterpretation of
the appeal provisions of the Plan.
B. Facts
1. Findings of the District Court
Hilton was employed by Scurlock Permian as a truck driver
for some ten years prior to September 1991 when he sustained a
work-related lower back injury that prevented his continued work.
He began receiving short-term disability payments, applied for and
received Workers’ Compensation, and applied for but was turned down
for Social Security benefits because his monthly income
disqualified him, not because of the nature of his injury.
At the time when Hilton was injured, he was a participant
in the Plan which was sponsored by Ashland Oil, Inc. (Ashland), of
which Scurlock Permian is a division. For purposes of ERISA, the
Plan is an employee welfare benefit plan.3 Approximately eleven
months after he was injured, Hilton applied to the Plan for long-
term disability benefits. Although Ashland is the plan
administrator, Prudential Life Insurance Co. (Prudential) serves as
3
29 U.S.C. § 1002(1).
4
“claims administrator” and makes all eligibility determinations for
the Plan (the remaining administrative duties and functions,
including interpretation of the Plan, are performed by Ashland as
plan administrator).
For purposes of entitlement to benefits, the Plan
provides:
You will be eligible for benefits, upon a timely filing
of a claim for benefits and after expiration of the
applicable waiting period, if medical evidence,
satisfactory to the Plan administrator, shows that you
are physically unable to perform the duties of any
occupation for which you are reasonably qualified by
education, training and experience, or for which you may
be reasonably re-trained or rehabilitated.4
Within the required period of three months following Hilton’s
application, Ashland denied his claim.5
When Prudential denied Hilton’s claim in November 1992,
it considered the following evidence regarding Hilton’s education,
training and experience: He had a high school education; he had
owned and managed his own service station; he had been self-
employed as a mobile home mover; and, since coming to work for
Scurlock Permian, his job had been that of a truck driver, which is
classified as “heavy labor involving a lot [sic] of lifting,
climbing, and bending.”
4
It is undisputed that the Plan allocates administrative and
interpretative discretion to the plan administrator.
5
The Plan contains a provision, which accords with ERISA
regulations, 29 C.F.R. § 2560.503-1(e), specifying that a claim is
deemed denied if no decision is forthcoming within ninety days
following application.
5
In addition to the information that Prudential had at its
disposal regarding education, training and experience, it had
considerable information regarding Hilton’s injury. A report from
Dr. Danielson, Hilton’s primary care physician throughout his
treatment, indicated that Hilton had incurred a serious back injury
and that a year of treatment had not improved his condition. After
Hilton was diagnosed with degenerative discs in the bottom three
levels of his spine, Dr. Danielson had prescribed physical therapy,
including walking up to two to three miles a day, which Hilton did
but not without severe pain. Following some six months of
treatment, Dr. Danielson acknowledged that “Hilton is not doing
well with physical therapy and we need to make some changes.” Out
of concern for Hilton’s psychological attitude and its potential
effect on recovery, Dr. Danielson referred Hilton to a clinical
psychologist who concluded that “[p]sychologically, [Hilton] is a
fair candidate for recovery” even though at the time he was
experiencing some stress and emotional depression as a result of
the injury.
After approximately one year, Dr. Danielson determined
that, despite participating in the physical therapy program, Hilton
was in constant pain which increased with activity. The doctor
discussed surgery, which he thought of as a last resort. He
nevertheless referred Hilton to a surgeon; however, Hilton had
still not seen the surgeon by the time Prudential made its decision
to deny his claim. Neither had a functional capacity evaluation
6
been performed before that decision was made: Dr. Danielson had
recommended that Hilton check into the possibility of re-training
in a sedentary field, and had set up a functional capacity
evaluation for Hilton, but —— as in the case of the recommendation
to see a surgeon —— Dr. Danielson’s efforts to get Hilton to obtain
a functional capacity evaluation went largely unheeded.
Consequently, Prudential never received an impairment rating report
until Hilton’s attorney sent it in mid-March of 1993, some six
months after the denial of Hilton’s claim.
Meanwhile, Hilton had hired an attorney after the
November denial of his claim, and the attorney asked for and
received a 30-day extension to the 60-day time for appeal. That
was early in January 1993. Despite having been advised by
Prudential that Hilton was entitled to but one appeal before the
decision became final, his attorney still had not submitted
additional medical evidence to Prudential by late February, so he
asked for and received yet another extension of 30 days. It was
just before the second extension expired, in mid-March, that
Hilton’s attorney finally sent in the report on the impairment
rating, and even then it showed only a nine (9%) percent whole body
impairment. On the last day of March, Prudential affirmed its
denial of benefits and rejected Hilton’s appeal.
In July 1993 back surgery was performed on Hilton. Some
six months after that, in January 1994, his attorney asked that the
claim for long-term disability benefits be reconsidered for yet
7
another time. As Prudential was not authorized to interpret the
terms of the Plan, it referred the belated, additional request for
another appeal to Ashland’s Benefits Administration Office. The
request was denied for the stated reason that the plan permits but
one appeal. No claimant had ever received a second appeal, and the
Summary Plan Description (SPD) makes no mention of a second appeal.
2. Additional Record Evidence
The Plan is an employee-contributory one for which the
plan administrator merely holds the contributions in trust and
makes payments of benefits as required under the provisions of the
Plan. Entitlement to benefits requires that the employee furnish
medical evidence satisfactory to the plan administrator that he is
physically unable to perform the duties of any occupation, not just
those of the job he was performing, and not capable of being re-
trained to perform any such duties either.
Although claim determination is delegated to Prudential,
neither it nor the Plan is responsible for obtaining medical
evidence, either to support or refute a claim. Under the express
provisions of the Plan, the participant has the burden of proof:
“Obtaining medical evidence to establish a claim for Plan benefits
is the responsibility of the participant and is obtained at the
participant’s cost.”
Hilton was a truck driver, a high school graduate, and a
former small businessman who had owned and operated both a service
station and a mobile home moving service. Even though Hilton had
8
the burden of supporting his asserted disability with medical
evidence, Prudential went “above and beyond” its duty by attempting
gratuitously to obtain medical and vocational reports through
Hilton’s physician and the insurance company administering his
workers’ compensation claim. Scant as it was, the information that
Prudential was able to recover included a physician’s diagnosis of
acute lumbar strain; another physician’s report on motor testing
that revealed no weakness, atrophy, or fasciculations; MRI evidence
of L4-5 disc rupture; a physician’s opinion that “[t]here is about
an 80 percent chance that we can get [Hilton] over this without
surgery”; a doctor-to-doctor letter reporting that Hilton had been
walking between two and three miles a day, with a self-rated pain
of four on a scale of ten, down from nine just after the accident,
plus a show of concern about Hilton’s substantial weight gain and
its exacerbation of the situation; the possible need for
psychological counseling; a subsequent letter from the physician to
the workers’ compensation carrier noting that no light duty was
available but that Hilton was still walking two to three times a
week, and that the physician would advise against surgery except as
a last resort; and communication from the physician to Hilton
suggesting that he check with the compensation carrier about
settling the claim and the possibility of retaining in a sedentary
field. In addition, the claims administrator at Prudential
attempted to get specific information from Hilton’s primary
physician by writing and asking 17 questions, but none of the
9
questions were answered by the doctor. His unresponsive reply
merely stated that Hilton would be “set up for a functional
capacity evaluation and impairment rating . . . in the near
future,” which never happened until six months after the claim was
denied. As for the 17 questions, the physician brushed them off
with the statement that “[t]he information requested by your
questions should be in his medical records already and I assume you
have a copy of those and would suggest that you consult those for
details.” Significantly, the claims administrator received no
additional information from that physician or from Hilton. In
fact, her continued efforts to obtain information proved fruitless
for the most part, basically reflecting that efforts to get testing
and reports on Hilton had produced little or nothing of an
informative nature, principally due to Hilton’s failure to report
or communicate.
Having nothing before her but the meager results of her
own voluntary efforts to do Hilton’s evidence-gathering job for
him, the claims administrator recommended denial of Hilton’s claim
for failure to meet his burden of supplying acceptable evidence in
support of the Plan’s “any occupation” definition of disability.
That recommendation was based on Prudential’s inference, from the
little evidence that was available, of the “possibility” of
Hilton’s being retained for sedentary work, coupled with the levels
of his education and prior work experience, and the dearth of
medical evidence that he could not perform or be re-trained to
10
perform the work required for any occupation.
During the specified period permitted for one appeal, as
twice extended, the only additional medical submission reflected
that Hilton adequately performed standing and walking tests and did
not complain of pain, and that under the AMA guidelines, he
suffered only a nine percent whole body physical impairment
disability rating.
As noted, in recommending affirmance of the original
denial, Prudential’s claims administrator relied on Hilton’s age,
prior employment, and the “possibility” of sedentary employment
through re-training. This was explained in detail to Hilton’s
attorney by telephone on the day in March before the appeal was
rejected and was followed up by a letter even further detailing the
reasons for denying the claim and the appeal. When, some nine
months later, Hilton’s attorney again wrote to Prudential seeking
to re-open the matter on the basis of “additional medical
evidence,” his request was referred to Ashland. Its Supervisor of
Benefits Administration responded that the Plan would not be able
to review additional medical evidence because (1) no further appeal
procedures were permitted under the Plan, and the (2) the length of
time that had passed since the “second and final denial” was
prejudicially excessive. Hilton filed suit some eight months after
that.
3. The Trial and the Judgment
In October 1995, following completion of a bench trial,
11
the district court ruled that the plan administrator’s
determination that Hilton was not disabled within the definition of
the Plan constituted an abuse of discretion. Hilton’s subsequent
motion for attorneys’ fees was denied. The district court remanded
the case to the plan administrator with instructions to consider
new evidence and make a new determination of disability based
thereon.
II
ANALYSIS
A. Standard of Review
As correctly noted by the district court, when an ERISA plan
vests the plan administrator with discretionary authority to make
eligibility determinations or construe the Plan’s terms, decisions
of the plan administrator must stand unless there is an abuse of
discretion.6 In turn, our review of the district court’s
determination whether a plan administrator endowed with
discretionary rights has abused that discretion is conducted under
the standards that we generally apply in non-jury civil cases:7
Questions of law are review de novo8; findings of fact are reviewed
6
Firestone Tire & Rubber Co. V. Bruch, 489 U.S. 101, 115,
109 S. Ct. 948, 956-57, 103 L. Ed. 2d 80 (1989), see also Cutting v.
Jerome Foods, Inc., 993 F.2d 1293, 1295-96 (7th Cir.), cert.
Denied, 510 U.S. 916 (1993).
7
Switzer v. Wal-Mart Stores, Inc., 52 F.3d 1294, 1298 (5th
Cir. 1995).
8
Id.; Liberty Mutual Ins. Co. v. Pine Bluff Sand & Gravel
Co., Inc., 89 F.3d 243, 246 (5th Cir. 1996).
12
for clear error.9 Even though the district court’s weighing of
evidence is entitled to deference, the court’s factual findings may
be reversed as clearly erroneous when we are “left with a definite
and firm conviction that a mistake has been made.”10
B. Determination of Disability
As accurately framed by the district court, Hilton claims
first that the plan administrator erred in concluding that he
failed to meet the Plan’s definition of disability. Because
“Congress intended Plan fiduciaries, not the federal courts, to
have primary responsibility for claims processing,”11 a
determination by a plan administrator vested with discretion to
evaluate such questions as whether a claimant has met the
definition of disability, must be upheld unless the plan
administrator is found to have abused its discretion. As stated by
the district court here, abuse of discretion hinges on whether the
plan administrator acted arbitrarily or capriciously.12 Under the
arbitrary or capricious rubric, the plan administrator need only
“articulate a satisfactory explanation for [its] action including
9
Switzer, 52 F.3d at 1298.
10
Id. (citing Anderson v. City of Bessemer City, 470 U.S. 564,
573 (1985)).
11
Duhon v. Texaco, Inc., 15 F.3d 1302, 1309 (5th Cir. 1994)
(quoting Makar v. Health Care Corp. of Mid-Atlantic, 872 F.2d 80,
83 (4th Cir. 1989)).
12
Sweatman v. Commercial Union Ins. Co., 39 F.3d 594, 601
(5th Cir. 1994).
13
a rational connection between the evidence before it and its
decision.”13 We have made clear that when a district court is
reviewing a determination of the plan administrator for abuse of
discretion, the review is limited to the evidence that is actually
before the plan administrator; and the same rule applies to our
review of that decision.14 Central to our review of the district
court’s determination here, and equally central to that court’s
review of the plan administrator’s determination that Hilton was
not disabled as defined by the Plan, is the fact that the plain
wording of the Plan expressly placed on Hilton —— as the party
claiming to be disabled, and thus entitled to benefits —— the
burden of proving (i.e., submitting credible and probative medical
evidence satisfactory to the Plan), that he was in fact disabled to
that extent.
The framework described by the foregoing legal maxims for
testing the plan administrator’s determination for abuse of
discretion was correctly recited by the district court. Despite
such talismanic recitation, however, the court’s own opinion
demonstrates that in actuality the court (1) shifted the burden of
proof from Hilton to the plan administrator, and (2) applied the
13
See Brooks v. Protective Life Ins. Co., 883 F. Supp. 632,
638 (M.D. Ala. 1995) (citing Motor Vehicle Mfs. Association of the
United States, Inc. v. State Farm Mutual Automobile Ins. Co., 463
U.S. 29, 43, 103 S. Ct. 2856, 2866, 77 L. Ed. 2d 443 (1983).
14
Wildbur v. ARCO Chem. Co., 974 F.2d 631, 639 (5th Cir.
1992).
14
clear error standard of review to the plan administrator’s
determination, rather than the substantially more deferential abuse
of discretion standard.
The district court expressly “found that the evidence
available to the Plan administrator is insufficient to support a
finding that Hilton was not disabled.” The foundational fallacy
revealed by that statement is apparent: It was not the plan
administrator’s burden to find sufficient evidence to eschew
disability; rather, it was Hilton’s burden to submit sufficient
satisfactory medical evidence to establish that he was disabled.
By requiring the claimant to collect and submit evidence that he is
so severely disabled that he cannot perform the duties of any
occupation, a presumption of ability (i.e., a presumption against
disability) clearly exists. We reiterate for emphasis that it was
not incumbent on the plan administrator to make a “finding” that
Hilton was “not disabled”; rather, it was incumbent on Hilton to
adduce positively probative evidence sufficient to support a
finding that he was disabled. Specifically, it was Hilton’s burden
to adduce a preponderance of evidence, satisfactory to the plan
administrator (more discretion!), that he was not able to perform
any job for which he was either qualified through education,
training, and experience to perform, or that he could reasonably be
re-trained to perform.
Our synopsis of the facts found by the district court and
present in the record reflects a cavalier attitude and
15
lackadaisical effort on Hilton’s part regarding the submission of
probative evidence sufficient to support a determination that
despite his education, training, and experience, he could not
perform any job or be re-trained to do so. Indeed, the slight
evidence before the plan administrator at the time the decision was
made had been assembled thanks to the efforts of the claims
administrator and her persistence in badgering physicians and the
compensation carrier for additional information. Even with the
luxury of two extensions of 30 days, neither Hilton nor his counsel
produced positive evidence of the kind needed to meet the test of
disability under the Plan.
The importance of the burden of proof under such a situation
is demonstrated by the district court’s own words that “[t]he
evidence available to the Plan administrator is insufficient to
support a finding that Hilton was not disabled.” When the court’s
characterization of the evidence that was before the administrator
is properly recast, with the burden placed on Hilton where it
belongs under the Plan, the court could not have justified a
determination of arbitrary or capricious decision making: “The
evidence available to the plan administrator is insufficient to
support a finding that Hilton was [] disabled.”
Sometimes we must resort to reductio ad absurdum to make our
point. Suppose that instead of having before her only the scant
evidence that she had been able to assemble by “pulling teeth” of
those from whom Hilton should have obtained and submitted evidence,
16
the claims administrator had had absolutely no evidence to
consider. Under that hypothetical situation, the administrator
would not have had even a scintilla of “evidence . . . to support
a finding that Hilton was not disabled.” Surely our hypothetical
plan administrator could not be deemed to have abused discretion;
yet under the district court’s test —— that the plan administrator
must have sufficient evidence to support a finding that the
claimant is not disabled —— the same illogical holding of abuse of
discretion would appertain. Q.E.D.
Compounding the error is the district court’s specific reason
for holding the plan administrator guilty of acting arbitrarily or
capriciously: a “misinterpretation” of the record. The court
first notes —— correctly —— that Prudential’s claims administrator
refused to credit Hilton’s claim of disability as meeting the
definition of the Plan by reciting erroneously that Hilton had
completed his therapy and only needed to see the physician on an
“as needed” basis; that Hilton’s experience as a mobile-home mover
and service station owner and operator, as well as his education,
qualified him for future employment; and that he was capable of
being re-trained for sedentary work. The court then painstakingly
parsed and analyzed the reports and letters that the claims
administrator had before her, concluding that the court’s reading
of such information demonstrated that the claims administrator’s
conclusions were the result of a “misinterpretation of the record.”
Assuming, arguendo, that the district court is absolutely
17
correct, that its evaluation of the evidence that was before the
claims administrator is right and that hers “misinterpret[ed] the
record”: The district court would then be within its rights to
label as “clearly erroneous” the claims administrator’s
interpretation of the facts. But clear error is not the applicable
standard of review of a plan administrator’s discretionary
determination. Rather, the applicable standard is abuse of
discretion, and clear error simply cannot support a conclusion of
arbitrary or capricious behavior by either the claims administrator
or the plan administrator in this case.
First, whether correctly or not, the claims administrator
demonstrated conscientious persistence —— beyond her burden —— to
assemble the kind of medical and vocational evidence that Hilton
was duty bound to present. The claims administrator twice extended
the time requested by counsel for Hilton within which to submit
additional evidence, but he failed to produce anything of a
meaningful nature. The record demonstrates that Hilton, by his
refusal to respond to correspondence or timely to submit himself
for a vocational evaluation, became a positive obstacle to his own
burden of proof.
Moreover, we must respectfully disagree with the district
court’s effort to distinguish the situation in Duhon v. Texaco,
Inc.15 Like Duhon, Hilton has failed to present medical evidence
15
15 F.3d 1302 (5th Cir. 1984).
18
of total disability, essentially presenting no evidence in support
of his claim. While the question of the capability of performing
sedentary work may differ slightly between Duhon and Hilton, there
is at least an implication in both cases that the respective
physicians anticipated the possibility of the plaintiff’s being re-
trainable to do just that. The most congruency between the two
cases is the failure of the claimants to take advantage of abundant
opportunities to present evidence of their own disabilities within
the definition of the respective plans. Here, the district court
in actuality applied the clear error standard, while mislabeling it
the abuse of discretion standard and, at the same time, in
actuality assigned the burden of proof to the wrong party, when it
concluded that “[b]ased on the medical and work history before the
administrator, it was an abuse of discretion to conclude that
Hilton was not disabled under the Plan’s definition.” The very
most that court could have concluded without committing error was
that the plan administrator clearly erred in interpreting Hilton’s
admittedly scant evidence as being insufficient to meet his burden
of proof that he was disabled —— there being no burden on the plan
administrator to prove Hilton was “not disabled under the Plan’s
definition.” But clear error will not carry the day when abuse of
discretion commands greater deference to the plan administrator.
We are convinced first that the record evidence before the
claims administrator, and additionally before the plan
administrator, at the time discretion was exercised to conclude
19
that Hilton failed to prove disability under the Plan’s definition,
demonstrated a rational exercise of discretion, not an abuse
thereof. Even if she clearly erred in doing so, the claims
administrator carefully considered all that she had to go on and
found a rational nexus between those data and the purposes and
provisions of the Plan. We are likewise convinced that the
explanation articulated by the administrators were sufficient to
demonstrate a rational connection between that evidence and the
determination of Hilton’s failure to prove qualifying disability to
support such a decision. Based on these conclusions, we hold that,
given such a rational relationship, there was nothing arbitrary or
capricious in the administrators’ actions and determinations, and
thus no abuse of discretion on the part of the plan administrator.
Consequently, the district court’s determination that there was
such abuse constitutes reversible error.
4. Right to Further Appeals
Hilton’s second charge against the plan administrator was
that it erred in limiting him to only one appeal. The district
court concluded that:
In this case, . . . the administrator’s
interpretation of the Plan’s right of appeal
is correct. First, Ashland Oil has given a
uniform construction to the Plan, consistently
interpreting the Plan to allow only one
appeal. Moreover, the two letters that
granted Hilton an extension on his first
appeal emphasized that the first appeal is
non-reviewable.
Second, a fair reading of the Plan supports
Ashland Oil’s interpretation . . . . the
20
complete description of the process for one
appeal without mentioning a second appeal
clearly implies that only one appeal is
allowed.
We have reviewed the arguments and citations of authorities on
this point as set forth in the briefs of Hilton’s counsel, and we
remain unconvinced that there was any error of fact or law in the
district court’s analysis and holding on the question of the number
of appeals or reconsiderations to which Hilton was entitled.
Indeed, we agree entirely with the district court’s reasons and
conclusions in this regard.
III
CONCLUSION
For the reasons set forth above, we respectfully disagree with
the district court’s determination that the plan administrator
abused its discretion in rejecting Hilton’s claim of permanent
disability within the definition of the Plan. Our disagreement
stems primarily from what we perceive to be an impermissible
reversal of the burden of proof from Hilton, who was obligated to
submit sufficient medical evidence to the plan administrator to
prove disability, to the plan administrator, which the district
court obligated to find sufficient evidence that Hilton was not
disabled. That fundamental error, coupled with a de facto
(mis)application of the clear error standard in the guise of the
abuse of discretion standard of review of the plan administrator’s
determination, leaves us no choice but to reverse the abuse of
21
discretion holding of the district court and reinstate the
determination of the plan administrator. On the other hand, we are
satisfied that the district court was correct in affirming the plan
administrator’s interpretation of the Plan’s limit of the number of
appeals to which a claimant is entitled to one.
We therefore affirm the judgment of the district court to the
extent it held that disappointed claimants for long-term disability
benefits under the Plan are limited to one appeal; but we reverse
the judgment of the district court to the extent it held that the
plan administrator abused its discretion when it rejected Hilton’s
claim due to his failure to support his assertion of disability
with sufficient medical evidence. In the absence of abuse of
discretion, the determination of the plan administrator must be
upheld, so we affirm the denial of Hilton’s application for long-
term disability benefits under the Plan.
AFFIRMED in part; REVERSED and RENDERED in part.
22