United States District Court, E.D. Kentucky, Southern Division, Pikeville
OPINION AND ORDER
K. CALDWELL, CHIEF JUDGE.
ERISA matter is before the Court on Defendant, Life Insurance
Company of North America's motion for application of the
arbitrary and capricious standard of review. (DE 13.) For the
reasons set forth below, the Court will
grant Defendant's motion.
dispute involves a group disability insurance policy (the
“Policy”) issued by Life Insurance Company of
North America (“LINA”) to Regina Hurd's
employer, Pikeville Medical Center, Inc. (“PMC”),
to provide coverage for its group insurance plan (the
“Plan”). Hurd obtained coverage through documents
issued by her employer describing the Plan terms. Those terms
made clear that claims were to be administered by LINA. On
June 16, 2018, Plaintiff removed a state action to this Court
alleging that Defendant wrongfully denied her benefits due
under the Policy when it halted disability payments in
January of 2017. (DE 1.) The Court has jurisdiction over
these claims pursuant to the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. §
1132, which provides a mechanism for enforcing insurance
policies like Plaintiff's.
LINA argues for the deferential arbitrary and capricious
standard based on the Plan documents issued by
Plaintiff's employer, which delegate discretionary
authority to LINA for administration of the claims made under
the Plan. Plaintiff Hurd on the other hand, argues for a
de novo review standard.
reviewing benefit determinations under ERISA apply a de
novo standard unless the plan provides “the
administrator or fiduciary discretionary authority to
determine eligibility for benefits, ” in which case a
“deferential standard of review [is]
appropriate.” Firestone Tire & Rubber Co. v.
Bruch, 489 U.S. 101, 115 S.Ct. 948, 103 L.Ed.2d 80
(1989). In addition, though “magic words” are not
necessary, the Sixth Circuit “has consistently required
that a plan contain a clear grant of
discretion.” Frazier v. Life Ins. Co. of N.
Am., 725 F.3d 560, 566 (6th Cir. 2013) (citing Perez
v. Aetna Life Ins. Co., 150 F.3d 550, 555 (6th
instant case, the Policy provides that to receive disability
benefits, the employee “must provide the Insurance
Company, at his or her own expense, satisfactory proof of
Disability before benefits will be paid.” (AR at 2370.)
The Policy also enumerates that the “Insurance Company
will require continued proof of the Employee's Disability
for benefits to continue.” (AR at 2370.) The parties
here disagree as to whether this “satisfactory
proof” language grants LINA the discretionary authority
to determine benefit eligibility. (DE 10.)
Defendant LINA correctly points out, Frazier is the
controlling authority on the matter. There, the Sixth Circuit
reviewed an older LINA policy with the exact same language as
the Policy at issue here. Frazier, 725 F.3d at 566.
Upon finding LINA's “satisfactory proof”
language sufficient to confer discretion, the court applied
the arbitrary and capricious standard of review. Id.
Since the language in dispute is identical to that in
Frazier, the same outcome is warranted. Thus, the
Court finds that the Policy language is enough to confer
discretion, making the arbitrary and capricious standard of
concedes that Frazier requires an application of the
arbitrary and capricious review standard. (DE 14.) It is her
argument, however, that Frazier was wrongly decided
and should be overturned. In support of this contention, Hurd
notes the trends of other circuits and argues that the
underpinnings of the Frazier decision have been
eroded with time. (DE 14.) Whatever the merits of her
argument, it is not the province of this Court to consider
them. Unless the Sixth Circuit overturns Frazier,
this Court is bound by its holding.
the Court finds Hurd's arguments for applying
Hoover unpersuasive. In Hoover, the court
addressed a policy containing “written proof and
“proper written proof language. Hoover v. Provident
Life & Acc. Ins. Co., 290 F.3d 801, 808 (6th Cir.
2002). This “written proof language is markedly
different from the language that was at issue in
Frazier and is in dispute here. The Court is also
unconvinced by Hurd's attempts to distinguish the matter
based upon the location of the disputed language within the
IT IS ORDERED that Defendant's Motion
for application of the arbitrary and capricious ...