ERISA-Second Circuit Affirms Summary Judgment Granting Long-Term Disability Benefits

In Donachie v. Liberty Life Assurance Company of Boston, Nos. 12-2996-cv (Lead), 12-3031 (XAP) (2nd Cir. 2014), one issue on appeal is whether the district court erred by entering sua sponte summary judgment for plaintiff on his claim for long-term disability (“LTD”) benefits pursuant to ERISA.

In this case, the plaintiff (“Donachie”) suffered anxiety stemming from the noise made by a prosthetic valve inserted into him through surgery. Donachie submitted a claim for LTD benefits to defendant Liberty Life Assurance Company of Boston (“Liberty”), the administrator of his employer’s LTD plan (the Plan”). On the basis of its own doctor’s recommendation, Liberty denied Donachie’s claim. Ultimately, this suit ensued.

In analyzing the case, the Second Circuit Court of Appeals (the “Court”) said that a sua sponte grant of summary judgment to the plaintiff is permissible only if the facts before the district court were fully developed so that the defendant suffered no procedural prejudice and the court is absolutely sure that no issue of material fact exists. Here, Liberty does not contend that it was denied the opportunity to place all relevant evidence in the record. Accordingly, the district court’s grant of summary judgment was not procedurally deficient. Further, upon review of the record, the Court concluded that Liberty’s denial of LTD benefits was arbitrary and capricious. Liberty ignored substantial evidence from Donachie’s own treating physicians that he was incapable of performing his current occupation, while failing to offer any reliable evidence to the contrary. Accordingly, the Court affirmed the District Court’s judgment under which it entered summary judgment for Donachie on his ERISA claim for LTD benefits.

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