United States District Court, W.D. Kentucky, Louisville
JAMES W. HACKNEY, Plaintiff,
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY, ET AL., Defendant.
CHARLES R. SIMPSON, III, District Judge.
This matter is before the Court on the following motions:
1) a motion to dismiss or, in the alternative, a motion for summary judgment (DN 81) filed by Defendant Lincoln National Life Insurance Company ("Lincoln");
2) a motion to strike exhibits and memorandum related to Lincoln's Motion to Dismiss (DN 92) filed by Plaintiff James W. Hackney ("Hackney");
3) a motion for reconsideration (DN 101) of the magistrate judge's Order on Motion for Discovery (DN 97) filed by Hackney;
4) a motion for leave to file a surreply brief (DN 102) in opposition to Lincoln's Motion to Dismiss filed by Hackney; and
5) a motion for summary judgment (DN 107) filed by Defendant Vascular Solutions, Inc. ("VSI").
For the reasons set forth below, the Court will:
1) hold the motion to dismiss or, in the alternative, motion for summary judgment in abeyance pending receipt of Hackney's response thereto;
2) deny the motion to strike exhibits and memorandum;
3) deny the motion for reconsideration;
4) deny the motion for leave to file a surreply brief; and
5) grant the motion for summary judgment.
Unless otherwise indicated, the following facts are undisputed. Defendant VSI is a Minnesota-based company engaged in the development and sale of medical devices designed for use in coronary and peripheral vascular procedures. In June 2005, Hackney began working for VSI as an Associate Account Manager, in which capacity he was responsible for obtaining new business by direct selling into hospital catheter labs and hospital interventional radiology labs in Kentucky, Southern Indiana, and Southern Ohio. Over the course of the next several years, Hackney was gradually promoted until he finally assumed the position of Director of Marketing for Catheters on July 1, 2010. As Director of Marketing, Hackney created market feasibility plans in consultation with VSI sales representatives and engineers, in addition to reviewing and drafting marketing literature such as brochures and instructional documents.
The terms of Hackney's employment as Director of Marketing were governed by an Employment Agreement ("Agreement") between Hackney and VSI. Pursuant to the Agreement, Hackney was an "at-will" employee to be paid an annualized salary of $178, 000. Section 8 provided that Hackney would be entitled to severance pay in the event that he was terminated for any reason other than "Violating Conduct, " which was defined to include "a violation of the Company's written Code of Conduct..., falsely reporting factual information to management, job abandonment, or refusal to follow specific direction from management." Additionally, Section 4(e) provided that Hackney would be entitled to participate in any benefit plans established by VSI's Board of Directors. One of these plans was VSI's Salary Continuation Plan (the "Plan"), pursuant to which employees were entitled to shortterm disability benefits in the event they became "Totally Disabled." According to the Plan, an employee was considered "Totally Disabled" if he was unable to perform the "main duties of [his] regular occupation... due to sickness or injury..." (Salary Continuation Plan, DN 116-4, at 8). Although VSI paid all benefits under the Plan out of its general assets,  employees were not required to pay a premium in order to be eligible for benefits.
Because it did not have sufficient human resources personnel, VSI entered into an Advice to Pay Agreement with Defendant Lincoln whereby Lincoln agreed to administer VSI's shortterm disability benefits according to the terms of the Plan. Specifically, Lincoln agreed to review, investigate, and ultimately determine the merits of employees' claims for benefits under the Plan. Importantly, however, Lincoln's determinations were merely advisory and VSI retained the exclusive authority to approve or deny an employee's claim.
After several years of suffering from hypoparathyroidism, Hackney notified VSI on October 6, 2010, that he believed his condition had permanently disabled him such that he could no longer perform the necessary functions of his job. Shortly thereafter, he submitted a claim for short-term disability benefits pursuant to the Plan. Based on its review of his claim, Lincoln recommended to VSI that it approve Hackney's claim for approximately four weeks, which VSI ultimately approved. In a letter dated October 14, 2010, Lincoln informed Hackney that VSI had approved his claim for benefits extending through November 2, 2010, and that, in order to qualify for benefits beyond that date, he would be required to submit additional medical evidence demonstrating that he remained disabled. However, Lincoln emphasized that "[a] note from your physician without any supporting medical evidence may not be sufficient to consider further benefits." (DN 121 at 20).
On November 3, 2010, Hackney failed to report for work. Believing that he remained permanently disabled, Hackney instead sought additional disability benefits pursuant to the Plan. In support of his claim, Hackney submitted the following medical records:
1) Medication List;
2) Office Visit Note from Dr. Tom Childress dated July 5, 2010;
3) Office Visit Note from Dr. Paul Goodlett dated September 2, 2010;
4) Office Consult from Dr. Tom Childress dated September 27, 2010;
5) Radiology Report dated September 30, 2010;
6) Office Visit Note from Dr. Paul Goodlett dated September 30, 2010;
7) Office Visit Note with Dr. Paul Goodlett dated October 5, 2010;
8) Office Visit Note from Dr. Tom Childress dated October 6, 2010;
9) Letter from Dr. Paul Goodlett dated October 6, 2010;
10) Attending Physician's Statement from Dr. Paul Goodlett dated October 11, 2010;
11) Letter from Dr. Lary Fineman dated October 24, 2010.
Based on its review of these records, Lincoln recommended that VSI deny Hackney's claim for extended benefits on the grounds that he had failed to establish that he remained "Totally Disabled" within the meaning of the Plan. In accordance with Lincoln's recommendation, VSI determined that Hackney was ineligible to receive benefits beyond November 2, 2010, and accordingly denied his claim for extended benefits.
On March 2, 2011, Hackney appealed VSI's denial of his claim for extended benefits. After considering his appeal, Lincoln recommended that VSI deny the appeal on the grounds that the medical documentation failed to support his claim that he remained Totally Disabled. In accordance with Lincoln's recommendation, VSI denied Hackney's appeal. On March 30, 2011, Lincoln informed Hackney via letter that VSI had decided to deny his appeal. In the letter, Lincoln explained that the medical records submitted by Hackney established only that Hackney was restricted from prolonged standing, walking, climbing, pushing, pulling, bending and lifting. Because such tasks were not necessary functions of Hackney's position as Director of Marketing, Lincoln explained that Hackney failed to meet the definition of Totally Disabled as that term was defined in the Plan.
During the appeal process, VSI attempted to contact Hackney several times in order to determine whether he planned on returning to work or whether he would require accommodations in order to do so. On January 18, 2011, Hackney responded that he was still unable to return to work and would therefore need additional time off work. Despite the fact that Hackney's FMLA leave had expired three weeks earlier, VSI agreed to hold his position open until April 20, 2011, at which time he would be required to return to work.
On April 20, 2011, Hackney failed to report to work. On April 21, 2011, VSI notified Hackney that it was terminating his employment effective May 12, 2011. As grounds for termination, VSI explained that Hackney had failed to respond to VSI's request that he identify accommodations that could make it possible for him to return to work. Given Hackney's refusal to return to work despite VSI's ...