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Deborah Firman v. Becon Construction Company

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION


April 15, 2011

DEBORAH FIRMAN, PLAINTIFF,
v.
BECON CONSTRUCTION COMPANY, INC., BECON PERSONAL ACCIDENT *FN1 INSURANCE PLAN/502, AND LIFE INSURANCE COMPANY OF NORTH AMERICA, DEFENDANTS.

The opinion of the court was delivered by: Ewing Werlein, Jr.united States District Judge

MEMORANDUM AND ORDER

Pending are Defendants' Motion for Summary Judgment (Document No. 23) and the Cross Motion for Summary Judgment of Plaintiff Deborah Firman (Document No. 53). After having considered the motions, responses, the applicable law, and the administrative record, the Court concludes as follows.

I. Background

Plaintiff Deborah Firman claims, pursuant to ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), that Defendant Life Insurance Company of North America ("LINA")*fn2 wrongly denied her the benefits of her common-law husband's ERISA-governed Group Accident Policies. Her husband, Gilberto Espinoza, an employee of Houston-based Defendant Becon Construction Company, Inc. ("Becon"), participated in two accidental death and dismemberment policies under the Becon Personal Accident Insurance Plan/502 (the "Plan")*fn3

Group Accident Policy OK 826455 issued to Becon by LINA and LINA Voluntary Personal Accident Insurance Group Policy OK 822833 (together, the "Policies"),*fn4 both of which named Plaintiff as the beneficiary.*fn5 Becon was the ERISA Plan sponsor and administrator under the plan,*fn6 but designated LINA as the claims administrator,*fn7 and both policies conferred upon LINA "full discretionary authority to administer and interpret" both policies.*fn8

Both Policies state that benefits will be paid for "loss from bodily injuries . . . caused by an accident which happens while an insured is covered by this policy."*fn9 Neither policy, however, contains a definition of the term "accident."

A. Insured's Death

Espinoza died in a single-vehicle crash in Kentucky on September 20, 2008. His blood and urine alcohol content were 0.20 percent and 0.35 percent, respectively, at the time of his death,*fn10 and the investigating officer reported a "strong odor of alcohol" and "an open container of cold Budlight Beer inside the vehicle" upon his arrival.*fn11 According to the officer's report, Espinoza's truck veered off the roadway to the right upon entering a left curve; Espinoza overcorrected, sending the truck over the road onto the left shoulder, where it rolled over.*fn12 Espinoza was not wearing a seat belt, and he was partially ejected out of the passenger-side window and crushed by the vehicle.*fn13 The crash occurred shortly after noon in clear weather and dry road conditions.*fn14 The medical examiner who performed Espinoza's autopsy opined that the cause of death was "[m]ultiple blunt force injuries," and marked the death as an "Accident,"*fn15 which was also reflected on Espinoza's death certificate.*fn16

B. LINA's Investigation and Denial of Benefits

Plaintiff made a claim for benefits under the Policies, which LINA received on December 4, 2008.*fn17 It reviewed Plaintiff's claim, Espinoza's death certificate, the police report, the toxicology report, the medical report, and the Policies, then on December 23, 2008, informed Plaintiff that the claim was not covered because it was not an "accident."*fn18 LINA interpreted "accident" in the Policies to mean "a sudden, unforeseeable event,"*fn19 and stated that Espinoza "would have been aware of the risks involved in operating his vehicle while under the influence" because "every state in the nation has criminalized drunk driving," and therefore "[a]ll licensed motorists throughout the United States are on notice, by operation of law, of the state-declared prohibitions against drunk driving and its consequences."*fn20 The letter stated that Espinoza had an "alcohol level of 0.35%," which it asserted was "more than four times the maximum level of alcohol in which it is legal to operate a motor vehicle in the state of Kentucky."*fn21 Because Espinoza "would have been aware of the risks involved in operating his vehicle while under the influence, his death was a foreseeable result of his actions and thus not an accident."*fn22

LINA also relied upon the "self-inflicted injury" exclusion in the Policies as a reason for denial. It noted that, by drinking and driving, Espinoza "placed his life and the lives of others in jeopardy" because "[i]t is commonly known that driving while intoxicated may result in death or bodily harm, as intoxication can lead to impaired judgment and decreased reflexes."*fn23 His death was therefore "a result of intentionally self-inflicted injuries," and was excluded by the Policies.*fn24

C. Plaintiff's Appeal

Plaintiff retained counsel and appealed LINA's decision in January 2009.*fn25 Her letter of appeal also advised LINA to consider it "as notice of her claim to pursue litigation, damages, statutory penalties, and attorney fees if this claim is not immediately resolved."*fn26 Her counsel pointed out that LINA's denial letter improperly compared Espinoza's urine alcohol content to Kentucky's legal blood alcohol limit for driving under the influence,*fn27 and subsequently submitted additional information consisting of affidavits of the investigating officer and medical examiner.*fn28

The investigating officer asserted that he believed the curve on the road was dangerous for someone not familiar with the area, noting that he had investigated numerous accidents at the site.*fn29

He further stated that, based on his investigation, there was no evidence that Espinoza intentionally caused the accident, knew it would occur, or reasonably could have anticipated his death.*fn30 The medical examiner similarly found no evidence that Espinoza intended his death, nor that he reasonably could have anticipated it, because "'driving under the influence' does not naturally and probably lead to the type of injuries" that resulted in his death.*fn31

Plaintiff's counsel also submitted Texas and Kentucky state case law interpreting accidental death insurance policies in the context of alcohol-related automobile crashes, concluding that under the law of either state, Espinoza's crash would be considered an "accident" under the Policies.*fn32

In response to these submissions, LINA informed Plaintiff that it was conducting a "home office review," which was "needed in order to interpret the documents we have received as they relate to the provision of this policy."*fn33 The claims administrator assigned to the appeal forwarded Plaintiff's contentions to LINA's in-house counsel,*fn34 who responded with a five-page memo labeled "PRIVILEGED & CONFIDENTIAL ATTORNEY-CLIENT COMMUNICATION."*fn35 The memo opined that Plaintiff's relied-upon state law would be inapplicable to the interpretation of an ERISA policy governed exclusively by federal law: "The standard that claimant advances - one of natural and probable consequences - is not the standard utilized by federal courts applying the common law of ERISA."*fn36 It then noted the absence of Fifth Circuit authority regarding "whether an ERISA insured's death that occurs while driving when intoxicated is an accident in the context of [an] accidental death benefit plan," and looked to decisions by the Fourth, Sixth, and Seventh Circuit Courts of Appeal as authority that, if LINA had discretion to make determinations under the Plan, it would not abuse that discretion by concluding that Espinoza's death was not an "accident" because "a reasonable person would foresee the likelihood of death or serious injury as a result of driving while intoxicated."*fn37 The memo also stated that the officer's and medical examiner's affidavits were not persuasive, because they were based not "on the facts of the incident, but on their personal view of whether it was natural and probable that Mr. Espinoza could not reasonably have foreseen his death."*fn38

LINA issued a letter to Plaintiff denying her appeal because:

Injury or death resulting from driving under the influence of alcohol is considered foreseeable and is not covered by the provisions of [the Policies]. Driving when intoxicated precludes a finding that a death is Accidental. As mentioned previously, the policy definition of a Covered Accident requires that a loss not be foreseeable.*fn39

In the letter, LINA again erroneously stated that Espinoza's "blood alcohol concentration was 0.35%," which it again asserted was "more than four times the threshold for presumed intoxication while driving in the state of Kentucky."*fn40 Finally, the letter advised Plaintiff that she had exhausted all levels of administrative appeal.*fn41

Pending are cross-motions for summary judgment. Plaintiff asserts that LINA abused its discretion in denying her benefits, and further asserts that its denial was procedurally improper due to LINA's failure to disclose its in-house counsel's memo sooner. Defendants seek dismissal of all claims.

II. Legal Standards

A. Summary Judgment Standard

Rule 56(c) provides that summary judgment "should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c).*fn42 The moving party must "demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 106 S. Ct. 2548, 2553 (1986).

Once the movant carries this burden, the burden shifts to the non-movant to show that summary judgment should not be granted. Morris v. Covan World Wide Moving, Inc., 144 F.3d 377, 380 (5th Cir. 1998). A party opposing a properly supported motion for summary judgment may not rest upon mere allegations or denials in a pleading, and unsubstantiated assertions that a fact issue exists will not suffice. Id. "[T]he nonmoving party must set forth specific facts showing the existence of a 'genuine' issue concerning every essential component of its case." Id.

In considering a motion for summary judgment, the district court must view the evidence "through the prism of the substantive evidentiary burden." Anderson v. Liberty Lobby, Inc., 106 S. Ct. 2505, 2513 (1986). All justifiable inferences to be drawn from the underlying facts must be viewed in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 106 S. Ct. 1348, 1356 (1986). "If the record, viewed in this light, could not lead a rational trier of fact to find" for the non-movant, then summary judgment is proper. Kelley v. Price-Macemon, Inc., 992 F.2d 1408, 1413 (5th Cir. 1993). On the other hand, if "the factfinder could reasonably find in [the non-movant's] favor, then summary judgment is improper." Id. Even if the standards of Rule 56 are met, a court has discretion to deny a motion for summary judgment if it believes that "the better course would be to proceed to a full trial." Anderson, 106 S. Ct. at 2513.

B. ERISA Standard of Review

ERISA confers jurisdiction on federal courts to review benefit determinations by fiduciaries or plan administrators. See 29 U.S.C. § 1132(a)(1)(B). A plan claims administrator makes two general decisions when deciding whether to pay benefits:

(1) finding the facts underlying the claim and (2) determining "whether those facts constitute a claim to be honored under the terms of the plan." Schadler v. Anthem Life Ins. Co., 147 F.3d 388, 394 (5th Cir. 1998) (quoting Pierre v. Conn. Gen. Life Ins. Co./Life Ins. Co. of N. Am., 932 F.2d 1552, 1557 (5th Cir. 1991)) (emphasis in original). The administrator's first decision, its fact finding, is always reviewed for abuse of discretion. Wade v. Hewlett-Packard Dev. Co. LP Short Term Disability Plan, 493 F.3d 533, 537 (5th Cir. 2007). The second determination, the administrator's interpretation of the plan, is typically reviewed de novo, "[b]ut where, as here, a plan expressly confers discretion on the plan administrator to construe the plan's terms, the administrator's construction is reviewed for abuse of discretion." Id. at 537-38 (internal footnote omitted); see also Firestone Tire & Rubber Co. v. Bruch, 109 S. Ct. 948, 956-57 (1989). Because the parties agree that the Plan's Summary Plan Description conferred discretionary authority upon LINA,*fn43 both of its determinations are appropriately reviewed for an abuse of discretion.

When reviewing the administrator's second decision--interpretation and application of the plan language--for an abuse of discretion, the Fifth Circuit applies a two-step inquiry. Stone v. UNOCAL Termination Allowance Plan, 570 F.3d 252, 257 (5th Cir. 2009). First, the court examines whether the determination was legally correct; if so, there can be no abuse of discretion. Id. If not legally correct, then the court proceeds to step two to decide whether the determination was an abuse of discretion. Id.

An abuse of discretion occurs when "the decision is not based on evidence, even if disputable, that clearly supports the basis for its denial." Holland v. Int'l Paper Co. Retirement Plan, 576 F.3d 240, 246 (5th Cir. 2009) (internal quotation marks and citation omitted). Such an abuse occurs "only where the plan administrator acted arbitrarily or capriciously," and a decision is arbitrary when it is made "without a rational connection between the known facts and the decision or between the found facts and the evidence." Id. (citing Meditrust Fin. Servs. Corp. v. Sterling Chems., Inc., 168 F.3d 211, 214-15 (5th Cir. 1999)) (internal quotation marks omitted). The decision need only "fall somewhere on a continuum of reasonableness--even if on the low end." Corry v. Liberty Life Assur. Co. of Boston, 499 F.3d 389, 398 (5th Cir. 2007) (quoting Vega v. Nat'l Life Ins. Servs., Inc., 188 F.3d 287, 297 (5th Cir. 1999) (en banc), abrogated on other grounds by Metro. Life Ins. Co. v. Glenn, 128 S. Ct. 2343 (2008)). "Although we generally decide abuse of discretion based upon the information known to the administrator at the time he made the decision, the administrator can abuse his discretion if he fails to obtain the necessary information." Salley v. E.I. DuPont de Nemours & Co., 966 F.2d 1011, 1015 (5th Cir. 1992).

In this case LINA operates under a conflict of interest; it is uncontested both that LINA has discretionary authority to make claims decisions and that it is responsible for paying benefits under the Plan.*fn44 See Glenn, 128 S. Ct. at 2348 (2008). Although the presence of a conflict is not determinative, and does not permit converting the "abuse of discretion" review into a more onerous standard of review, it is properly considered as a factor in the overall analysis of LINA's denial of benefits. See Glenn, 128 S. Ct. at 2350-52 (2008); Holland, 576 F.3d at 247-48 n.3.*fn45

III. Discussion

For support of LINA's denial of benefits, Defendants rely on Sanchez v. Life Insurance Co. of North America and Davis v. Life Insurance Co. of North America, two unpublished Fifth Circuit decisions upholding LINA's denial of benefits where the insureds died in single-car crashes when driving while intoxicated. Sanchez, 393 F. App'x 229 (5th Cir. 2010) (unpublished op.); Davis, 379 F. App'x 393 (5th Cir. 2010) (unpublished op.). In both of those cases, however, LINA's policies each defined "accident" as "[a] sudden, unforeseeable, external event." Sanchez, 393 F. App'x at 233; Davis, 379 F. App'x at 395-96. In sharp contrast to those cases, neither of the Policies nor the Plan in this case contains either that definition or any other definition of "accident." Thus, this case requires consideration of a similar but distinctly different question, namely, whether LINA abused its discretion in determining that Espinoza's death was not an "accident" under a policy written by LINA without inclusion of any definition of the term "accident."

While neither Accident Policy defines "accident," the Policies do exclude coverage for injuries from certain activities. These include:

* Intentionally self-inflicted injuries

* Travel or flight if the insured is a pilot or crew member

* Hang-gliding

* Parachuting (except for self-preservation), and

* Commission of a felony by the insured.*fn46

Neither Policy excludes coverage for injury when driving an automobile while intoxicated.*fn47

LINA in its claim administration used essentially the same definition for "accident" that is written into some of its accidental death policies--such as those in Sanchez and Davis--but which is not found in Espinoza's Policies, namely "a sudden, unforeseeable event."*fn48 Because Espinoza "would have been aware of the risks involved in operating his vehicle while under the influence, his death was a foreseeable result of his actions and thus not an accident."*fn49 LINA denied Plaintiff's appeal for the same reason, and further because "[d]riving when intoxicated precludes a finding that a death is Accidental."*fn50 In making that decision, LINA gave a legally incorrect definition to the term "accident" and, moreover, abused its discretion by applying a per se rule that death resulting from driving while intoxicated is never an accident, despite the absence of a policy exclusion so stating.

A. Legally Incorrect Interpretation

Three factors bear upon whether an interpretation is legally correct: "(1) whether the administrator has given the plan a uniform construction, (2) whether the interpretation is consistent with a fair reading of the plan, and (3) any unanticipated costs resulting from different interpretations of the plan." Stone, 570 F.3d at 258 (quoting Crowell v. Shell Oil Co., 541 F.3d 295, 312 (5th Cir. 2008)).*fn51 The "most important" of these factors "is whether the administrator's interpretation was consistent with a fair reading of the plan." Id. (citing Crowell, 541 F.3d at 313).

Although LINA has consistently interpreted its accident policies--whether or not they define "accident"--to exclude from coverage drunk driving deaths,*fn52 its consistency does not save its interpretation in this case because it is not a fair reading of Espinoza's Policies in which "accident" is not a defined term. LINA's interpretation of the term "accident," in fact, is wholly inconsistent with the definition given that term by federal common law in the Fifth Circuit.

Writing for the Fifth Circuit in Todd v. AIG Life Insurance Co., Justice Byron White held that it was appropriate for the district court to conclude that:

[F]or death under an accidental death policy to be deemed an accident, it must be determined (1) that the deceased had a subjective expectation of survival, and (2) that such expectation was objectively reasonable, which it is if death is not substantially certain to result from the insured's conduct.

47 F.3d 1448, 1456 (5th Cir. 1995). The Fifth Circuit has also phrased the test in an alternative manner: "whether a reasonable person, with background and characteristics similar to the insured, would have viewed the injury as highly likely to occur as a result of the insured's intentional conduct." Schadler v. Anthem Life Ins. Co. 147 F.3d 388, 397 n.10 (5th Cir. 1998) (quoting Wickman v. Nw. Nat'l Ins. Co., 908 F.2d 1077, 1088 (1st Cir. 1990)). Both cases demonstrate the Fifth Circuit's acceptance of the Wickman standard, as Judge Sarah Vance observed in her analysis of the circuit's precedents in Carter v. Sun Life Assur. Co., No. 05-2214, 2006 WL 1328821, at *6, *5-6 (E.D. La. May 11, 2006) ("[W]hile the Fifth Circuit has never squarely applied all three Wickman determinations to the same case, the Wickman approach is followed in this circuit and is the standard by which an administrator's determination is to be measured.").

The Wickman analysis requires that for a death to be considered "accidental," the insured must have had the subjective expectation of survival, and that expectation must have been objectively reasonable "from the perspective of the insured, allowing the insured a great deal of latitude and taking into account the insured's personal characteristics and experiences." 908 F.2d at 1088. In the more typical case where there is insufficient evidence of the insured's actual expectations, a purely objective analysis is undertaken as "a good proxy for actual expectation": the death is not an accident if "a reasonable person, with background and characteristics similar to the insured, would have viewed the injury as highly likely to occur as a result of the insured's intentional conduct." Id.

LINA's interpretation eschews the Wickman approach to defining accident, and is therefore legally incorrect. In Wickman, the starting point was the actual expectation of the insured, limited only by excluding "patently unreasonable" expectations from the definition of "accident," which equates to situations where death or serious injury is "highly likely." This compares favorably to the dictionary definition of "accident": "an unforeseen and unplanned event or circumstance," or "lack of intention or necessity." WEBSTER'S NINTH NEW COLLEGIATE DICTIONARY at 49 (1990).

LINA's interpretation, on the other hand, does not focus the inquiry on what is actually expected or foreseen by the insured, tempered only by patently unreasonable expectations, but rather, on what is foreseeable--that is, capable of being foreseen. Further, it does not ground this interpretation in the alternative objective analysis of Wickman, asking from the perspective of the insured whether death or serious injury is "highly likely" to occur, not merely asking whether death or serious injury is "foreseeable." In short, LINA's interpretation of "accident" excludes from its bounds not just the "patently unreasonable" expectation, Wickman, 908 F.2d at 1087, but anything that is merely "foreseeable." This goes well beyond the limited exception to an insured's actual expectations (or a "proxy" thereof) established by Wickman and followed by the Fifth Circuit in Todd and Schadler.*fn53 Indeed, there is much persuasive authority pointing to a variety of examples that are commonly considered "accidents" but which would be excluded from being so regarded if events that are merely "foreseeable" or "reasonably foreseeable" were not considered "accidents."*fn54

Furthermore, LINA's interpretation runs contrary to the provisions of the Policies, which specifically pay an additional 10 percent of the insured's benefits if he or she "dies as a result of an automobile accident while wearing a properly fastened, original, factory-installed seatbelt."*fn55 It is certainly "foreseeable" that one not wearing a seatbelt--such as Espinoza--may die in a car crash, which, by LINA's definition, would by itself render that person's death not an "accident." Yet, the Policies specifically provide for additional coverage for an insured who dies while wearing a seatbelt, implying that one who does not wear a seatbelt is covered at the basic amount. See LaAsmar, 605 F.3d at 807 ("To some degree, the language of the Plan at issue here providing for the possibility of additional benefits if the insured chose to wear a seat belt suggests that an insured's failure to take precautions against obvious dangers would not preclude AD & D benefits under this policy.").

In sum, LINA made a legally incorrect determination of the undefined term "accident" as it is used in the Accident Policies and Plan that covered Espinoza.

B. Abuse of Discretion

LINA also abused its discretion in denying benefits under the Accident Policies without sufficient evidence in the administrative record to support its determination and by its application of what effectively is a per se rule that drunk driving deaths can never be an "accident" under a policy that contains no exclusion for drunk driving.

Unlike the instant case, Sanchez and Davis involved evidence supporting LINA's decision in addition to the insured's blood alcohol content. In Davis, the administrative record contained a toxicologist's findings; the Fifth Circuit therefore held that LINA's determination was reasonable "[c]onsidering the toxicologist's findings as to the effects of such severe intoxication." Davis, 379 F. App'x at 396. Similarly, in Sanchez, the administrative record contained eyewitness accounts that the insured's vehicle "swerved sharply in the road" before rolling over; a forensic consultant's opinion that a person with the insured's blood alcohol content would have "'poor judgment, increased reaction time, muscle incoordination, loss of visual acuity, [ ] increased risk taking' and be unable to drive safely"; and the consultant's citation to "volumes of references regarding the effects of alcohol producing impairment regardless of tolerance." Sanchez, 393 F. App'x at 233.*fn56

Here, on the other hand, the administrative record is entirely devoid of any evidence--other than Espinoza's blood alcohol content as compared to the legal limit in Kentucky--regarding whether the crash was foreseeable.*fn57 In fact, LINA erroneously garbled even this single piece of evidence: rather than comparing Espinoza's blood alcohol content to Kentucky's legal limit, LINA cited his urine alcohol concentration and compared it to Kentucky's legal limit for blood alcohol concentration. LINA repeated this error in its appeal denial letter, after Plaintiff's attorney had specifically pointed out LINA's error in its first denial letter. Moreover, instead of considering any other facts specific to the case, LINA effectively adopted a stance that a crash resulting from any blood alcohol content over the legal limit is per se foreseeable, and therefore per se not an "accident." For instance, its internal notes reveal that LINA presumed Espinoza's awareness of the dangers of drunk driving (and therefore the foreseeability of his own death resulting therefrom) unless something in the administrative record indicated otherwise:

There is nothing in file to support fact that Mr. Espinoza was not aware of the risks involved in operating his vehicle while intoxicated. Therefore, his death was a foreseeable result of his actions and *fn58 thus not an accident.

As already observed, LINA's initial denial letter cited only to Espinoza's urine alcohol content, and otherwise asserted that "every state in the nation has criminalized drunk driving," which therefore put "[a]ll licensed motorists throughout the United States . . . on notice, by operation of law, of the state-declared prohibitions against drunk driving and its consequences."*fn59

Finally, LINA's denial of Plaintiff's appeal flatly states the per se rule it applied in this case:

Having reviewed the available record, indications are that Mr. Espinoza was driving under the influence of alcohol at the time of this motor vehicle crash. This resulted in his death. Injury or death resulting from driving under the influence of alcohol is considered foreseeable and is not covered by the provisions of [the Policies]. Driving when intoxicated precludes a finding that a death is Accidental.*fn60

No circuit court considering drunk driving crashes has approved a claims administrator's use of a per se rule in the context of ERISA accidental death policies. To the contrary, the courts consistently have expressed disapprobation for the use of such a rule. See LaAsmar v. Phelps Dodge Corp. Life, Accidental Death & Dismemberment and Dependent Life Ins. Plan, 605 F.3d 789, 802 (10th Cir. 2010) (noting that "[c]courts have consistently rejected such a per se rule, as would we," and collecting cases); see also Stamp v. Metro. Life Ins. Co., 531 F.3d 84, 91 & n.9 (1st Cir.), cert. denied, 129 S. Ct. 636 (2008) (rejecting "categorical determination that all alcohol-related deaths are per se accidental or nonaccidental" by noting that "we have been careful to explain that the proper approach is fact-specific and that the decedent's degree of intoxication is particularly probative," and further reviewing the evidence relied upon by the administrator--including an internal medical department report, online resources, and a university police handbook--that constituted a "well-developed record of the severe impairment that would be expected from Mr. Stamp's level of intoxication"); Lennon v. Metro. Life Ins. Co., 504 F.3d 617, 619, 622, 624 (6th Cir. 2007) (noting that under the particular facts, including the insured's "extremely high blood-alcohol content" of 0.321, the administrator reasonably determined that the insured's death was not an accident, but declining to reach "the question of whether a fiduciary can reasonably deny 'accidental' benefits for injury that results from any negligent or any illegal behavior, or from driving while only somewhat impaired");*fn61 accord Eckelberry v. Reliastar Life Ins. Co., 469 F.3d 340, 345 (4th Cir. 2006); Cozzie v. Metro. Life Ins. Co., 140 F.3d 1104, 1106, 1110 (7th Cir. 1998).*fn62

The above cases are persuasive, particularly in light of the Fifth Circuit's instructions that "the administrator can abuse his discretion if he fails to obtain the necessary information," Salley, 966 F.2d at 1015, and that an administrator abuses its discretion if its "decision is not based on evidence, even if disputable, that clearly supports the basis for its denial." Holland, 576 F.3d at 246 (internal quotation marks and citation omitted). Accordingly, LINA abused its discretion in determining that Espinoza's death was not an "accident."

C. Award

For the foregoing reasons, Plaintiff is entitled to an award of the Policies' benefits due under the Plan, plus interest.*fn63

Defendants have asked for remand to LINA for further review if the Court "determines the claims decision was not procedurally correct."*fn64 That is not the Court's decision; to the contrary, this decision is based on LINA's abuse of its discretion, not on a procedural defect. "If an administrator has made a decision denying benefits when the record does not support such a denial, the court may, upon finding an abuse of discretion on the part of the administrator, award the amount due on the claim and attorneys' fees." Vega v. Nat'l Life Ins. Servs., Inc., 188 F.3d 287, 302 (5th Cir. 1999) (en banc), abrogated on other grounds by Metro. Life Ins. Co. v. Glenn, 128 S. Ct. 2343 (2008). While remand may be justified in "some special circumstances," the Fifth Circuit in Vega "decline[d] to remand to the administrator to allow him to make a more complete record" on whether the insured's misrepresentation in seeking coverage was "material," where the record already developed contained insufficient evidence to support a conclusion of materiality. Id. at 302 n.13. The court sought "to encourage each of the parties to make its record before the case comes to federal court," and also noted that "it would be unfair to allow the administrator greater opportunity at making a record than the claimant enjoys." Id.

Because LINA twice had the opportunity directly to address the only question at issue--whether Espinoza's death was an "accident" under the Policies--and because both times it applied a legally incorrect definition to the undefined term "accident," and further made decisions without sufficient evidence to support its determination, remand is not appropriate. Cf. Schadler v. Anthem Life Ins., 147 F.3d 388, 398 (5th Cir. 1998) (holding that remand was appropriate where the plan administrator's denial was based only upon the erroneous conclusion that the plaintiff was not eligible for policy coverage; the administrator thus "never had occasion to exercise any discretion to interpret the terms of the Plan," or to make a full development of relevant facts and a decision thereon).

However, Plaintiff has established entitlement to an award only from the Plan, not from all named Defendants. See 29 U.S.C. § 1132(d)(2) ("Any money judgment under this subchapter against an employee benefit plan shall be enforceable only against the plan as an entity and shall not be enforceable against any other person unless liability against such person is established in his individual capacity under this subchapter."). Plaintiff's motion will therefore be granted with respect to the Plan, but denied as to all other defendants.*fn65

Remaining to be determined are whether attorney's fees should be awarded to Plaintiff under 29 U.S.C. § 1132(g)(1) and whatever remaining cause of action, if any, Plaintiff may have against the other Defendants Becon and LINA.

IV. Order

Based on the foregoing, it is ORDERED that Defendants' Motion for Summary Judgment (Document No. 23) is DENIED. It is further ORDERED that Plaintiff Debra Firman's Cross-Motion for Summary Judgment (Document No. 53) is GRANTED in part, and Plaintiff Debra Firman shall have and recover of and from Defendant Becon Personal Accident Insurance Plan/502 the benefits payable for the accidental death of Gilberto Espinoza under LINA Group Accident Policy OK 826455 and LINA Voluntary Personal Accident Insurance Group Policy OK 822833, which accidental death benefits the Court understands from the pleadings total $210,000, plus pre-judgment interest on these benefits from the dates they were due to be paid until the date of Final Judgment. Plaintiff's Cross-Motion for Summary Judgment is otherwise DENIED with respect to Defendants Becon Construction Company, Inc., and Life Insurance Company of North America. It is further ORDERED that within fourteen (14) days after the entry of this Order the parties shall jointly provide to the Court an agreed calculation setting forth the amount of the benefits and the prejudgment interest due under this Order for inclusion in the Court's Final Judgment. It is further ORDERED that within fourteen (14) days after the entry of this Order the parties' counsel shall personally confer in a good faith attempt to reach agreement on whether Plaintiff is entitled to recover attorney's fees and expenses and, if so, to reach an agreement upon the amount of reasonable and necessary attorney's fees and expenses that Plaintiff is entitled to recover, if any.

The parties shall promptly advise the Court of that agreement. If good faith efforts to reach agreement on attorney's fees should fail, then Plaintiff's attorney may file his affidavit for attorney's fees and expenses and supporting material within twenty-one (21) days after the date of this Order, together with a brief showing entitlement to the same, and Defendant may file a controverting affidavit and supporting materials, and a brief setting forth Defendant's position, within ten (10) days after having been served with Plaintiff's affidavit and supporting materials.

It is SO ORDERED.

The Clerk will enter this Order, providing a correct copy to all counsel of record.


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