United States District Court, W.D. Kentucky, at Louisville
JAMES W. HACKNEY, Plaintiff,
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY, ET AL., Defendant.
CHARLES R. SIMPSON, III, Senior District Judge.
This matter is before the Court on a motion to dismiss, or in the alternative, for summary judgment (DN 81) filed by Defendant The Lincoln National Life Insurance Company ("Lincoln") against Plaintiff James W. Hackney ("Hackney"). For the reasons set forth below, the Court will hold the motion in abeyance until Hackney has completed discovery.
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 short-term 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 ...