Calhoun v. LINA

Case Name: Jack B. Calhoun, Jr. v. Life Insurance Company of North America

Court: U.S. Court of Appeals for the Sixth Circuit, on appeal from the U.S. District Court for the Southern District of Ohio.

Date of Decision: December 15, 2016.

Note: This case is “unpublished”, or “Not Recommended For Full-Text Publication”. An unpublished opinion is a decision of a court that is not available for citation as precedent because the court deems the case to have insufficient precedential value.

Type of Claim: Long Term Disability under the Employee Retirement Income Security Act (ERISA).

Insurance Company: Life Insurance Company of North America (LINA).

Claimant’s Employer: Mars, Inc..

Claimant’s Occupation / Job Position: Senior Maintenance Technician. He ran a team of technicians to repair & maintain factory equipment.”

Disabilities: Calhoun stopped working in January 2010 due to chronic leg and back pain that was aggravated by sitting, standing, and walking.

Definition of Disability in the Plan/Policy: The plan, administered by LINA, provided monthly benefits payments to employees with a “total disability.” An employee was defined as “totally disabled” if, during an initial 24-month period, he was “unable to perform all the essential duties of his occupation.” After that 24-month period, an employee was “totally disabled” only if “he [was] unable to perform all the essential duties of any occupation” for which he was reasonably qualified and also “remain[ed] unable to earn more than 75% of his Basic Monthly Earnings.” LINA both determined which claims were eligible for benefits under the plan and paid the benefits for eligible claims.

Benefits Previously Paid? Yes. Then terminated.

Basis For Denial / Termination of Benefits: In deciding to end Calhoun’s benefits, LINA concluded that Calhoun was no longer “totally disabled,” which was a prerequisite to Calhoun’s receipt of disability benefits under the insurance plan.

Procedural history: LINA informed Calhoun that it would review his claim to determine his continued eligibility for benefits. In addition to reviewing the medical records from his treating physicians, LINA arranged for Calhoun to be evaluated through a functional capacity analysis, additional video surveillance, transferrable-skills analysis, and peer review of Calhoun’s medical file.

LINA thereafter terminated benefits.

Calhoun appealed the termination of his benefits through LINA’s internal review process.

LINA denied Calhoun’s appeal.

Convinced that LINA terminated his benefits wrongfully, Calhoun sued LINA in district court under ERISA, 29 U.S.C. §§ 1001–1461, seeking their reinstatement.

The district court upheld LINA’s determination, finding that under the deferential arbitrary-and-capricious standard of review, LINA’s termination of benefits was not arbitrary and capricious. For the reasons set out below, the Sixth Circuit concluded that LINA’s decision to terminate Calhoun’s benefits was not the product of reasoned decision-making and was not supported by substantial evidence. Therefore, the Sixth Circuit held that LINA acted arbitrarily and capriciously when it denied Calhoun’s claim, reversed the judgment of the district court and remanded the case for further proceedings.

Medical Evidence to Support the Claim: Electromyography confirmed that Calhoun suffered from meralgia paresthetica, a compression of a nerve in the thigh, and an MRI revealed degenerative disc disease at L5-S1, a vertebral segment at the base of the spine.

Key Physician Opinions: Dr. Monique Boezi, Calhoun’s primary-care physician, summarized Calhoun’s symptoms:

Any walking hurts [Calhoun’s] back. . . . . If he stands for any leng[th] of time, about 10 minutes[,] he has to use a cane o[r] sit down . . . . His legs go numb when he sits for longer than 20-30 minutes . . . . All of these symptoms are daily and really affect his normal living . . . . [H]e cannot walk, stand, or sit for prolonged periods of time.

Dr. Boezi’s treatment notes consistently reflected Calhoun’s inability to sit or stand for prolonged periods of time, leading her to conclude that Calhoun could not work in his job as a maintenance technician because it required “a lot of walking and lifting and bending with prolonged standing,” but also that he could not work at a desk job, which required long periods of sitting.

In addition to his primary-care appointments with Dr. Boezi, Calhoun regularly saw Dr. Nancy Vaughan, an orthopedic specialist, for treatment of his condition. Dr. Vaughan reported that Calhoun could not stand for longer than 20 minutes and noted Calhoun’s difficulties with walking, but she declined Calhoun’s request for a power scooter, explaining that “[t]he sedentary lifestyle is more harmful to his health.” Dr. Vaughan wrote in her treatment notes that she thought Calhoun was “limiting his function more than he should be” and that his pain was “out of proportion to objective findings.” Calhoun also saw several other specialists: Dr. Robert Dixon, a neurosurgeon, who confirmed that Calhoun’s symptoms were consistent with Drs. Boezi and Vaughan’s diagnoses; Dr. Robert Stephenson, a physical medicine and rehabilitation specialist, who opined that it was unlikely that Calhoun’s spine was the cause of pain “so severe that [Calhoun] must use a motorized scooter”; and Dr. James Powers, another physical medicine and rehabilitation specialist, who opined that it was more likely that Calhoun’s pain was musculoskeletal rather than neurological.

LINA then engaged Dr. David Trotter, an orthopedic surgeon, to conduct a peer review
of Calhoun’s medical file. In his report, Dr. Trotter wrote, “The available documentation including surveillance video supports that the observed activities of daily living are inconsistent with the claimant’s self-reported limitations and overall self reported dysfunction.” Dr. Trotter rejected the conclusions of the March 2012 functional-capacity analysis, stating that “the objective findings are not commensurate with the rather inexplicable findings/lessor functionality evident within the [analysis].” Dr. Trotter clarified in an addendum to his report that “there is no credible evidence indicating this claimant is unable to perform full time sedentary or light level work.” Dr. Trotter’s review did not include a physical examination of Calhoun.

Issues: The Sixth Circuit reviewed de novo the district court’s judgment on the administrative record. However, as the benefits plan gave the plan administrator discretionary authority to determine eligibility for benefits, the Sixth Circuit reviewed the decision to deny benefits using the arbitrary-and-capricious standard of review.

(1) The Social Security Determination.

(2) File Reviews by Dr. Trotter and Dr. Antonelli.

(3) The Functional Capacity Analysis.


(1) In April 2012, Calhoun was awarded Social Security benefits for his disability. In finding that Calhoun was disabled within the meaning of the Social Security Act, an administrative law judge (ALJ) based his conclusion on, among other things, the functional capacity analysis, the MRI, physician treatment notes, testimony from a vocational expert, and statements from Calhoun regarding “the intensity, persistence and limiting effects” of his condition, all of which the ALJ found “generally credible.” The judge determined that the objective medical evidence established that Calhoun had some residual-functional capacity but found that Calhoun’s limitations precluded his ability to perform light work.

LINA’s treatment of the SSA’s disability determination weighs in favor of concluding
that LINA acted arbitrary and capriciously when it terminated Calhoun’s benefits. “[I]f the plan administrator (1) encourages the applicant to apply for Social Security disability payments; (2) financially benefits from the applicant’s receipt of Social Security; and then (3) fails to explain why it is taking a position different from the SSA on the question of disability, the reviewing court should weigh this in favor of a finding that the decision was arbitrary and capricious.” Bennett, 514 F.3d at 554. Although the SSA determination is not binding, it is “far from meaningless,” and, at a minimum, it indicates that the ALJ found objective support for the claim of disability.

(2) LINA’s reliance on file reviews in denying Calhoun’s claim also weighs in favor of
finding that LINA’s decision was arbitrary and capricious. We have repeatedly raised concerns regarding file reviews when the reviewing physician makes a conclusion as to the claimant’s credibility without ever physically examining him. See, e.g., Calvert, 409 F.3d at 295. Although “there is nothing inherently improper with relying on a file review[,] . . . [w]here . . . the conclusions from that review include critical credibility determinations regarding a claimant’s medical history and symptomology, reliance on such a review may be inadequate.” Id. at 297 n.6. Here, Dr. Trotter did not physically examine Calhoun as part of his review, but he nevertheless concluded that “there is no credible evidence indicating [Calhoun] is unable to perform full time sedentary or light level work.”

Dr. Trotter’s file review is also concerning for several other reasons. He nowhere
explained why he believed that the medical evidence did not support Calhoun’s claim; instead, Dr. Trotter summarized the evidence and baldly asserted that “the observed activities of daily living are inconsistent with the claimant’s self-reported limitations and overall self reported dysfunction.”

Dr. Antonelli’s file review, which LINA requested to assist with its review of Calhoun’s appeal to LINA, is similarly inadequate.

LINA’s reliance on the file reviews raises additional concerns because under the benefits plan, LINA reserved the right to conduct physical examinations of claimants. We have repeatedly found that “the failure to conduct a physical examination though the benefits plan explicitly reserves that right raises questions about the thoroughness and accuracy of the benefits determination.”

(3) LINA argues that the March 2012 functional-capacity analysis also supported its decision to terminate Calhoun’s benefits because it found that Calhoun was capable of working in a sedentary capacity. The functional-capacity analysis, however, nowhere stated that Calhoun was capable of working in a sedentary capacity; indeed, the evaluation concluded that Calhoun “exhibit[ed] limited tolerance for sustained sitting or standing.” Although a physical-ability assessment accompanying the functional-capacity analysis indicated that Calhoun could sit “frequently: 2.5-5.5 hrs/day, 1/3-2/3 of the day,” Calhoun’s capacity to sit frequently does not establish that he can work on a full-time basis.

In terminating Calhoun’s benefits, however, LINA failed to explain why it was crediting these notes from Drs. Vaughan and Stephenson over those of Dr. Boezi.

Noteworthy court comments: Here, objective medical evidence supported Calhoun’s disability. Calhoun’s electromyography and MRI reflected meralgia paresthetica and degenerative disc disease at L5-S1. The functional-capacity analysis, which “is objective evidence of a claimant’s disability,” Shaw, 795 F.3d at 552 (internal quotation marks omitted), detailed Calhoun’s limited tolerance for standing and sitting. The SSA judge, too, concluded that Calhoun was disabled because his capacity for work was “so narrow.” Calhoun’s primary-care physician, Dr. Boezi, concluded that Calhoun “can’t do a desk job due to the fact he can’t sit for any length of time.” All of Calhoun’s other examining physicians—Drs. Vaughan, Dixon, Stephenson, and Powers—agreed that Calhoun’s symptoms were consistent with meralgia paresthetica and degenerative disc disease. The only credible evidence against finding that Calhoun was disabled is Drs. Vaughan and Stephenson’s remarks questioning whether Calhoun’s pain required the use of a motorized scooter. But, neither Dr. Vaughan nor Dr. Stephenson questioned Calhoun’s diagnoses, and neither opined as to whether Calhoun could work at a sedentary occupation on a full-time basis. Because LINA produced no credible evidence that undermined the objective medical evidence that clearly established Calhoun’s disability, we remand this case to the district court for reinstatement of Calhoun’s disability benefits from the date that they were terminated.

Summary: Because the record establishes that LINA acted arbitrarily and capriciously in denying Calhoun long-term disability benefits, the Sixth Circuit REVERSED the district court’s judgment and REMANDED this case to the district court for entry of an order in conformity with this opinion.

Disclaimer: This was not a case handled by disability attorney Nick A. Ortiz. The court case is summarized here to give readers a better understanding of how Federal Courts decide long term disability ERISA claims.
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