Abromitis v. Continental Casualty Co./CNA Insurance Companies , 114 F. App'x 57 ( 2004 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 03-2425
SANDRA ABROMITIS,
Plaintiff - Appellant,
versus
CONTINENTAL CASUALTY COMPANY/CNA INSURANCE
COMPANIES,
Defendant - Appellee.
Appeal from the United States District Court for the Western
District of North Carolina, at Asheville. Max O. Cogburn, Jr.,
Magistrate Judge. (CA-02-165-C-1)
Argued: September 30, 2004 Decided: November 5, 2004
Before WIDENER, NIEMEYER, and LUTTIG, Circuit Judges.
Affirmed by unpublished opinion. Judge Luttig wrote the opinion,
in which Judge Widener and Judge Niemeyer joined.
ARGUED: Candy Maria Kern-Fuller, FOSTER LAW FIRM, L.L.P.,
Greenville, South Carolina, for Appellant. Ingrid Blackwelder
Erwin, JACKSON LEWIS, L.L.P., Greenville, South Carolina, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
LUTTIG, Circuit Judge:
Plaintiff-appellant Sandra Abromitis appeals from an order of
the United States District Court for the Western District of North
Carolina granting summary judgment to defendant-appellee
Continental Casualty Co./CNA Insurance Companies (“CNA”). The
district court held that CNA did not abuse its discretion in
terminating Abromitis’ long-term disability (“LTD”) benefits under
an ERISA-governed employee benefits plan. Because we agree that
CNA did not abuse its discretion, we affirm the judgment of the
district court.
I.
Appellant Abromitis was employed by Aris Corporation as a
“principal consultant and systems analyst” prior to December 1999.
J.A. 261. Her job required frequent travel and constant
availability for travel. During her employment at Aris, Abromitis
participated in an employee benefits plan (“the Plan”) administered
by CNA on behalf of her employer. The Plan is an employee welfare
benefit plan within the meaning of the Employee Retirement Income
Security Act (“ERISA”), 29 U.S.C. § 1001 et seq. According to the
terms of the Plan, an individual with a “total disability” is
entitled to LTD benefits. J.A. 866. The Plan provides a two-part
definition of “total disability.” During the “Your Occupation”
period of the first 24 months, “total disability” means that,
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[y]ou, because of Injury or Sickness, are:
(1) continuously unable to perform the substantial and
material duties of Your regular occupation;
(2) under the regular care of a licensed physician other
than Yourself; and
(3) not gainfully employed in any occupation for which
You are or become qualified by education, training or
experience.
J.A. 866. After the 24-month “Your Occupation” period, “total
disability” means that,
[B]ecause of Injury or Sickness, You are:
(1) continuously unable to engage in any occupation for
which You are or become qualified by education, training
or experience; and
(2) under the regular care of a licensed physician other
than Yourself.
J.A. 866. The Plan also provides that its administrator “ha[s]
discretionary authority to interpret the terms of the Plan and to
determine eligibility for and entitlement to benefits in accordance
with the Plan.” J.A. 871.
Abromitis applied for disability benefits under the Plan in
February 2000, after her fourth hip replacement surgery rendered
walking difficult. In support of her application, she submitted a
report from her orthopedist, Dr. Karegeannes, which asserted that
she would not be able to return to work until August 2000. J.A.
838. CNA awarded her disability benefits through August. In
August, as part of a successful application for an extension of her
benefits, Abromitis reported to CNA that she still walked painfully
with a cane, and said of her job that “it’s the travel I have a
hard time with.” J.A. 813. And in December 2000, Dr. Karegeannes
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reported that Abromitis’ recovery was slow and recommended
extending her disability benefits for another six months. J.A.
583.
On March 15, 2001, Dr. Karegeannes reported to CNA that
Abromitis was capable of “sedentary to light work with no travel
and sit/stand option.” J.A. 572 (emphasis added). On the basis of
this report, CNA terminated Abromitis’ benefits. Abromitis
appealed the decision, arguing that the Plan’s 24-month “Your
Occupation” period was still in effect and that she was incapable
of the frequent travel that was an essential part of her former
job. J.A. 535-36. CNA reinstated her benefits on July 18, 2001.
On October 24, 2001, still during the “Your Occupation”
period, CNA notified Abromitis that it would terminate her benefits
in December. She appealed again, submitting a report from Dr.
Karegeannes dated November 15, which stated:
I suspect that this late date [sic], the patient will be
unable to return to the work she was previously involved
with. She is unable to sit for any significant period of
time. . . . Generalized problems seem to have accumulated
to the point that it is difficult for her to do anything
similar to what she has done in the past.
J.A. 359 (emphases added). Dr. Karegeannes also submitted a
functional capacity exam (“FCE”) dated November 27, 2001. His FCE
report listed Abromitis’ diagnoses as hip dysplasia, spine
arthritis, and bursitis, and it listed physical limitations that
were inconsistent with travel but consistent with sedentary work
with a sit/stand option for frequent changes of position. J.A.
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676-77. On January 17, 2002, CNA again reinstated Abromitis’
benefits.
In February 2002, CNA hired Dr. Flora Pinder to perform a
labor market survey in Abromitis’ geographical area to determine
the availability of sedentary jobs with a sit/stand option for
changing position. J.A. 323. Dr. Pinder identified four potential
employers in the area with qualifying positions. J.A. 324-36. All
of these jobs required keyboarding work. J.A. 321-22.
On February 11, CNA notified Abromitis that it would terminate
her benefits on April 30 at the end of the “Your Occupation”
period, when the travel requirement of her former job became
inapplicable under the Plan’s two-stage definition of total
disability. J.A. 383-84. CNA noted that Dr. Pinder’s labor market
survey had identified jobs compatible with the limitations reported
by Dr. Karegeannes in the November 2001 FCE, and that Dr.
Karegeannes had opined in March 2001 that Abromitis was capable of
sedentary work with no travel. J.A. 383.
Abromitis appealed CNA’s decision to terminate her benefits,
submitting several new pieces of evidence. First, she submitted a
report from Dr. Cammarata, a hand specialist, who concluded that
Abromitis suffered from osteoarthritis of the hands, based on x-
rays and a physical examination conducted on February 11, 2001.
J.A. 351-52. This report did not indicate any functional
limitations. J.A. 351-52. Second, she submitted a report from
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Maggie Kelly, a “rehabilitation counselor,” who reviewed Abromitis’
medical records and reported that it was “uncertain whether
[Abromitis] could work an 8-hour day” due to her multiple medical
problems and arthritis-related difficulties with keyboarding. J.A.
338. Third, Abromitis submitted a report from Dr. Burke, who
examined her for the first time on February 15 and diagnosed her
with chronic mechanical pain, osteoarthritis, fibromyalgia (i.e.
back and neck pain), and pelvic obliquity. J.A. 347, 349.
Finally, in a personal affidavit, Abromitis alleged that the
impediments to her ability to work included hand arthritis, back
pain, physical therapy “nearly every weekday,” and migraine
headaches.1 J.A. 334. In June, CNA denied her appeal.
Abromitis subsequently filed suit in the district court,
seeking restoration of her benefits under the Plan. During
discovery, Abromitis requested information about the extent of
business contacts between CNA and Dr. Pinder, who had performed the
labor market survey. J.A. 22. The district court denied the
discovery request. J.A. 59. On cross-motions for summary
judgment, the district court granted summary judgment for CNA.
J.A. 275. On appeal, Abromitis challenges both the order denying
1
Apparently, Abromitis had suffered migraine headaches for
many years. But on April 25, 2001, a nurse practitioner reported
that Abromitis’ headaches had been effectively controlled by pain
medication. J.A. 422.
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her motion to compel discovery and the order granting summary
judgment to CNA.
II.
During discovery, Abromitis requested information about the
number of contracts between CNA and Dr. Pinder over the previous
three years and the total amount of money that CNA paid Dr. Pinder
under those contracts. J.A. 22. In her motion to compel
discovery, Abromitis argued that, because of a conflict of
interest, Pinder consistently “tailor[ed] her reports [about job
availability] to support claim denials.” J.A. 23. The district
court denied Abromitis’ motion to compel discovery, J.A. 59, and
Abromitis challenges this ruling on appeal.
We review the denial of a motion to compel discovery for abuse
of discretion, Erdmann v. Preferred Research, Inc., 852 F.2d 788,
792 (4th Cir. 1988), and we conclude that the district court did
not abuse its discretion here. On appeal, Abromitis argues that
Pinder’s labor market survey, upon which CNA in part based its
decision to terminate her benefits, was tainted by a conflict of
interest, and that the degree of this conflict of interest was
relevant to the district court’s review of CNA’s decision.
Appellant’s Br. at 23-29. But, as the district court correctly
noted, it is the administrator’s conflict of interest that is
relevant to the conflict-of-interest review conducted by the
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district court -- not the plainly evident “conflict of interest” of
the administrator’s paid employees and consultants. See J.A. 57
(“[I]t is not the conflict of interest of a consultant employed by
a fiduciary that the Fourth Circuit has held is relevant.”); see
also Booth v. Wal-Mart Stores, Inc. Assocs. Health and Welfare
Plan, 201 F.3d 335, 343 n.2 (4th Cir. 2000) (“A fiduciary’s
conflict of interest . . . may operate to reduce the deference
given to a discretionary decision of that fiduciary.” (emphasis
added)). It was therefore irrelevant how much business CNA
provided to Dr. Pinder, and the district court properly denied
discovery on that issue.2
III.
Abromitis also challenges the district court’s order awarding
summary judgment to CNA. We review the district court’s grant of
summary judgment de novo, applying the same standards as the
district court. Gallagher v. Reliance Std. Life Ins. Co., 305 F.3d
2One relevant question might have been whether the survey
upon which CNA relied provided false or inaccurate information,
rendering CNA’s decisionmaking process unreliable. But Pinder’s
survey simply recited several listings of sedentary jobs with a
sit/stand option in Abromitis’ area, based on contacting employers
by telephone. J.A. 324-26. Abromitis does not dispute the
accuracy of any fact in the survey. Rather, she argues only that
she could not perform the jobs that Pinder found because of her
medical problems and her lack of computer programming skills.
Appellant’s Br. at 12. This is a challenge to CNA’s conclusion
about her physical capabilities, not to Pinder’s research. The
issue of Pinder’s purported bias is thus all the more irrelevant.
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264, 268 (4th Cir. 2002). Where, as here, an ERISA plan gives the
plan administrator discretionary authority to interpret the terms
of the plan, the district court reviews the administrator’s
decisions for abuse of discretion. Booth, 201 F.3d at 341. Under
the abuse of discretion standard, the court may not overturn the
administrator’s denial of benefits if the denial “is the result of
a deliberate, principled reasoning process and if it is supported
by substantial evidence.” Elliot v. Sara Lee Corp., 109 F.3d 601,
605 (4th Cir. 1999).
Because CNA both administers and funds the plan, however, we
adjust the standard of review by decreasing our deference to CNA in
proportion to the degree of CNA’s conflict of interest. In such
circumstances, we must determine whether the denial of benefits
would constitute an abuse of discretion by a disinterested
fiduciary. See, e.g., Bailey v. Blue Cross & Blue Shield of
Virginia, 67 F.3d 53, 56 (4th Cir. 1995) (“[W]e will review the
merits of the [funding fiduciary’s] interpretation to determine
whether it is consistent with an exercise of discretion by a
fiduciary acting free of the interests that conflict with those of
the beneficiaries.”). Even on this adjusted scale of deference, we
conclude that CNA did not abuse its discretion because its decision
to terminate Abromitis’ benefits was the result of a deliberate,
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principled reasoning process and supported by substantial
evidence.3
We conclude that CNA’s decision was supported by substantial
evidence. In defending its decision, CNA relies primarily on Dr.
Karegeannes’ evaluations of Abromitis’ sedentary work capacity of
March 2001 and November 2001. On March 15, 2001, he classified
Abromitis as capable of “sedentary to light work with no travel and
sit/stand option.” J.A. 572. His November 15 remarks indicated
that Abromitis could not return to “the work she was previously
involved with,” J.A. 359, but his November 27 evaluation listed
restrictions consistent with sedentary occupation with a 30-minute
sit/stand option. J.A. 676. And none of his other reports on
Abromitis’ condition during the “Your Occupation” period identified
any objective obstacles to Abromitis’ performance of sedentary
work. See J.A. 361, 399, 583, 701, 758.
To contradict Dr. Karegeannes’ conclusion that she was capable
of sedentary work, Abromitis relies on her own affidavit and the
reports of Dr. Burke, Dr. Cammarata, and Maggie Kelly. But none of
these reports contradicts Dr. Karegeannes’ evaluation with any
3
Aside from the alleged conflict of interest of Dr. Pinder,
discussed above, the only defect in CNA’s reasoning process that
Abromitis identifies is CNA’s failure to perform “any meaningful
medical review” of her case after August 2000. Appellant’s Br. at
39. But because CNA’s decision was based largely on the reports of
Dr. Karegeannes from March and November of 2001, this argument is
without merit. Accordingly, we focus our discussion on the
substantiality of evidence supporting CNA’s decision.
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specific findings to the contrary. Abromitis’ affidavit includes
subjective pain complaints but no medical evidence. J.A. 334. Dr.
Burke’s report was based on a single examination in anticipation of
litigation, in contrast to Dr. Karegeannes’ years of treating the
patient, and Dr. Burke identified no specific functional
limitations to contradict Dr. Karegeannes’ evaluation of Abromitis’
physical abilities in November FCE. J.A. 313-14. Likewise, Dr.
Cammarata’s diagnosis of hand arthritis did not identify any
specific functional limitations such as the inability to type.
J.A. 351-52. And Maggie Kelly’s report was ambiguous as to
Abromitis’ ability to perform a sedentary job. J.A. 338 (finding
it “uncertain whether Mrs. Abromitis could work an 8-hour day”
(emphasis added)).
Therefore, it was reasonable for CNA to rely on Dr.
Karegeannes’ representation that Abromitis was capable of sedentary
work with the option of changing positions every thirty minutes.
J.A. 572. Dr. Pinder’s labor market survey identified local
sedentary jobs that permitted such changes of position. J.A. 324-
26. CNA could thus fairly conclude that Abromitis was not “unable
to engage in any occupation for which [she was] qualified by
education, training or experience,” as the Plan required. J.A. 866
(emphasis added).
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It follows that CNA’s decision was supported by substantial
evidence. The district court’s ruling that CNA did not abuse its
discretion was thus correct.
CONCLUSION
For the reasons stated herein, the judgment of the district
court is affirmed.
AFFIRMED
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