Robert Gordon v. Metropolitan Life Ins. Co. ( 2019 )

FILED
NOT FOR PUBLICATION
JAN 04 2019
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ROBERT GORDON, No. 17-16821
Plaintiff-Appellant, D.C. No. 5:10-cv-05399-EJD
v.
MEMORANDUM*
METROPOLITAN LIFE INSURANCE
COMPANY,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of California
Edward J. Davila, District Judge, Presiding
Submitted December 19, 2018**
San Francisco, California
Before: CALLAHAN, N.R. SMITH, and MURGUIA, Circuit Judges.
Robert Gordon brought suit against Metropolitan Life Insurance Company
(MetLife) for its denial of longterm disability benefits under a plan governed by
the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
§§ 1001-1461. The district court granted summary judgment in MetLife’s favor,
applying an abuse of discretion standard. Because the district court applied the
wrong standard, we reverse and remand.
The district court reviews a decision to deny benefits under an ERISA plan
de novo “unless the benefit plan gives the administrator or fiduciary discretionary
authority to determine eligibility for benefits or to construe the terms of the plan.”
Gatti v. Reliance Standard Life Ins. Co., 415 F.3d 978, 981 (9th Cir. 2005)
(quoting Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989)). “When
the plan gives the administrator or fiduciary discretionary authority to determine
eligibility for benefits, that determination is reviewed for abuse of discretion.” Id.However, even where a plan gives discretionary authority to the administrator,1 de
novo review (rather than abuse of discretion review) applies when an administrator
fails to actually exercise its discretion in the denial of benefits or when an
administrator commits “wholesale and flagrant violations of the procedural
requirements of ERISA, and . . . acts in utter disregard of the underlying purpose of
the [benefit] plan[.]” Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 971-72
(9th Cir. 2006) (en banc).
1
It is undisputed that the benefit plan at issue gave MetLife discretionary
authority.
2
Here, MetLife’s denial of benefits is subject to de novo review, because (1)
MetLife did not exercise its discretion when it failed to issue a final decision on
Gordon’s appeal of its initial denial of benefits, even years after the 90-day
deadline to do so, and (2) that failure is a wholesale and flagrant violation of the
requirements of both ERISA and the benefit plan. See Abatie, 458 F.3d at 971.
Despite the district court’s characterization that MetLife violated only timing
requirements, MetLife’s failure to issue a final decision on the appeal after years
(and without explanation) is necessarily a violation of the procedural requirements
for appeals set forth in ERISA. See 29 C.F.R. § 2560.503–1(h)-(j). Such action
utterly disregards MetLife’s obligations as a plan administrator.
Summary judgment in an ERISA case is only proper where there are no
genuine disputes of material fact, and the movant is entitled to judgment as a
matter of law. Fed. R. Civ. P. 56(a). Because the parties have produced conflicting
medical opinions regarding Gordon’s disability, those opinions create a genuine
dispute of material fact. Accordingly, we reverse the district court’s improper grant
of summary judgment.
REVERSED and REMANDED.
3