6th Circuit Standard of Review for LTD ERISA Claims

District court review of a plan administrator’s denial of benefits is normally de novo. Jones v. Metro. Life Ins. Co., 385 F.3d 654 (6th Cir. 2004). However, where a plan fiduciary has discretionary authority to determine eligibility for benefits or construe plan terms, a district court will review per the “arbitrary and capricious” standard. Whitaker v. Hartford Life & Acc. Ins. Co., 404 F.3d 947 (6th Cir. 2005).  The arbitrary and capricious standard is used so long as the plan contains a clear grant of discretion to the administrator to determine benefits or interpret the plan. Perez v. Aetna Life Ins. Co., 150 F.3d 550 (6th Cir. 1998).

The arbitrary and capricious standard “is the least demanding form of judicial review of administrative action . . . . When it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that outcome is not arbitrary or capricious.” Perry v. United Food & Commercial Workers Dist. Unions 64 F.3d 238, 241 (6th Cir. 1995).   As a result, a decision will “be upheld if it is the result of a deliberate principled reasoning process, and if it is supported by substantial evidence.” Baker v. United Mine Workers of America Health & Retirement Funds, 929 F.2d 1140, 1144 (6th Cir. 1991).  Substantial evidence is defined as “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229 (1938).


29 USC 1132 (e)(2) provides: “Where an action under this title is brought in a district court in the United States, it may be brought in the district where the plan is administered, where the breach took place, or where a defendant resides or may be found, and process may be served in any other district where a defendant resides or may be found.”


  • Plaintiff’s choice of forum is entitled to substantial deference.  Hanley v. Omarc, Inc., 6 F.Supp.2d (N.D.Ill. 1998).  However, the Plaintiff’s choice may still be incorrect. Id.
  • The defendant must be subject to personal jurisdiction in the selected venue.


  • Ret. Funds v. Golden Eagles Architectural Metal Cleaning & Refinishing, 277 F.Supp.2d 291 (S.D.N.Y. 2003)


  • The plaintiff’s state of residence can be a proper venue if that is the place where he/she was to receive benefits.  Cole v. Cent. States Southeast & Southwest Areas Health & Welfare Fund, 227 F.Supp.2d 190 (D.C.Mass. 2002); Oakley v. Remy Int’l, Inc., 2010 U.S.Dist. Lexis 10821 (M.D.Tenn. 2010)


  • For venue purposes, some courts hold that the corporation resides wherever personal jurisdiction is proper.  Ransom, 820 F.Supp. 1429 (N.D.Ga. 1993). But see Med. Mut. v. DeSoto, 245 F.3d 567 (6th Cir. 2001).

Consideration of Social Security determination in LTD claims

Quite often, a claimant who is receiving long term disability benefits will be required by the insurance company to file for Social Security Disability.  In fact, often the Plan will provide a representative to assist the claimant in obtaining Social Security disability benefits. If SSA awards benefits, the LTD carrier then claims an overpayment of benefits.   More often than not, the claimant is found disabled by SSA around two years after he/she became disabled, which is right around the time period when the LTD definition of disability changes.  I have represented a number of individuals who are approved by SSA for disability, and then denied by the LTD carrier a month or two later.  In the 6th Circuit, the LTD carrier is not permitted to ignore the SSA disability finding.  In situations where the LTD carrier has required the claimant to apply for disability, and receives a financial benefit from an award of SSA disability, a reviewing court will generally take those facts in to serious consideration in determinating when the decision to deny LTD benefits was arbitrary and capricious. Calvert v. Firstar Finance, Inc., 409 F.3d 286 (6th Cir. 2005); Glenn v. Metlife, 461 F.3d 660 (6th Cir. 2006).  As a practical and legal matter, if the LTD carrier requiring the claimant to apply for disability, is assisting the claimant in applying for disability, and receives a financial benefit from the claimant obtaining disability through SSA, the carrier should be estopped from arguing that the claimant is not disabled.

For example, in Raybourne v. Cigna Life Ins. Co. of New York, 2012 U.S.App. Lexis 24018 (7th Cir. Nov. 21, 2012), Raybourne applied for long term disability benefits with Cigna.  He also filed for Social Security disability benefits.  Cigna hired a company to assist Raybourne with his Social Security disability claim. Raybourne’s disability claim was approved by the Social Security Administration; however, just a few months prior to the disability award, Cigna hired a physician to review the file.  Said physician opined that Raybourne was not disabled.  The report from Cigna was never provided to the Judge deciding Raybourne’s Social Security disability claim.  Instead, after Raybourne was awarded social security disability benefits, Cigna “recouped from the back benefits the money the insurer had paid to Raybourne during the first twenty-four months of his disability.”  Even more disturbing is the fact that just three weeks before Raybournes social security disability hearing, Cigna denied Raybourne claim for long term disability.  In other words, Cigna hired someone to argue that Raybourne was disabled, despite the fact that Cigna had denied his claim for private disability benefits just three weeks prior to the hearing.  Cigna denied Raybourne’s administrative appeals, and did not even mention the social security disability finding.  The case went to federal court, at which time the federal judge remanded the claim back to Cigna for consideration of the SSA disability determination.  Cigna then supplied a list of “reasons” for not accepting the disability finding of the social security administrative law judge.  The Court noted the “seemingly inconsistent positions taken by the insurer” that were “financially advantageous to the insurer.”  The Court further noted that Cigna did not produce the report from their doctor to the Social Security Administration, and instead, only used his report “when it was financially advantageous to the insurer.”  Ultimately, the Court concluded: “Cigna’s denial of benefits was not supported by substantial medical evidence but instead was the result of a structural conflict of interest.” The Court also affirmed the award of attorney fees to Raybourne’s attorney.

If you would like to discuss your Social Security and/or Long Term Disability claim, please click here to obtain the author’s contact information.

11th Circuit Review of LTD Claims

The 11th Circuit has formulated a multi-step framework for reviewing an ERISA plan administrator’s decision:

  1. De novo review to determine whether the claim administrator’s benefits-denial decision is “wrong”; if it not, the decision will be affirmed.
  2. If the decision is “de novo wrong,” the Court will determine whether the administrator was vested with discretion in reviewing claims; if not, the decision will be reversed.
  3. If the administrator’s decision is “de novo wrong” and the administrator has discretion in reviewing the claim, the Court will determine whether “reasonable” grounds support the decision.
  4. If no reasonable grounds exist, the administrator’s decision will be reversed.  If there are reasonable grounds, the court will examine whether there is a conflict of interest.
  5. If there is no conflict of interest, the decision will be affirmed.
  6. If there is a conflict of interest, the court will consider the conflict of interest as a factor in determining whether the administrator’s decision was arbitrary and capricious.

Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350, 1355 (11th Cir. 2011).

Self-Reported Symptoms Limitation

I have previously discussed the self-reported symptoms limitation found in many LTD policies (LTD Exclusions and  Soft Tissue Exclusion). In Weitzenkamp v. Unum Life Ins. Co. of Am., 661 F.3d 323 (7th Cir. 2011), the claimant’s benefits were discontinued by Unum under the plan’s self reported symptoms limitation.  The Plan also claimed an overpayment due to the claimant’s receipt of SSDI benefits.  The Weitzenkamp case provides a great discussion on the exclusion, and thus, rather than summarizing, I am quoting the important language from the decision with some emphasis supplied, as follows:

To determine whether the self-reported symptoms limitation applies here, we begin with the language of the plan, which provides in relevant part:

Disabilities, due to sickness or injury, which are primarily based on self-reported symptoms, and disabilities due to mental illness, alcoholism or drug abuse have a limited pay period up to 24 months.

Self-reported symptoms means the manifestations of your condition which you tell your doctor that are not verifiable using tests, procedures or clinical examinations standardly accepted in the practice of medicine. Examples of self-reported symptoms include, but are not limited to headaches, pain, fatigue, stiffness, soreness, ringing in ears, dizziness, numbness and loss of energy.

The plan limits payment for “[d]isabilities, due to sickness or injury, which are primarily based on self-reported symptoms,” but the parties disagree as to what this clause means. Unum alleges that the focus is on whether the limitation on function is primarily based on self-reported symptoms. Although Weitzenkamp’s argument is convoluted at times, she argues at least in part that the focus must be on whether the diagnosis of the disease itself is primarily based on self-reported symptoms.

Although one can read the clause literally as Unum proposes (the plural self-reported symptoms clause modifies the plural “Disabilities” rather than the singular “illness or injury,” suggesting that if the inability to perform work is self-reported, the limitation applies), when the clause is considered in context and in light of actual application, the only viable conclusion is that the self-reported symptoms limitation applies to disabling illnesses or injuries that are diagnosed primarily based on self-reported symptoms rather than to all illnesses or injuries for which the disabling symptoms are self-reported. The contrary interpretation advanced by Unum would sweep within the limitation virtually all diseases, leaving only a small subset for coverage beyond that time period. For most illnesses or injuries, the disabling aspect is not the disease itself, but the pain, weakness, or fatigue caused by that illness or injury. Even diseases that are extremely likely to cause an inability to work, such as stage IV cancer or advanced heart disease, are disabling because of the pain, weakness or fatigue. Under Unum’s interpretation, however, those diseases would fall within the twenty-four-month limitation because pain, weakness and fatigue are self-reported symptoms that are difficult if not impossible to verify using objective medical evidence. In fact, at oral argument, Unum conceded that under its interpretation the provision would limit coverage for all conditions in which the disabling symptom is pain. Unum even maintained this was true regardless of the etiology of the pain, so that even if the underlying condition were highly likely to cause pain, the limitation would apply because the pain itself is self-reported and not verifiable. Despite this bold assertion, we have no indication that Unum actually applies or proposes to apply this limitation to disabilities based on diagnoses that can be objectively verified by clinical tests, procedures, and clinical examinations. Neither could this court countenance a reading that would allow Unum arbitrarily to disallow any illness or injury that it preferred not to cover while not making that explicit in its SPD. Although we must give deference to the administrator’s interpretation of the plan terms, see Marrs v. Motorola, Inc., 577 F.3d 783, 787 (7th Cir. 2009) (citing Ross v. Indiana State Teacher’s Ass’n Ins. Trust, 159 F.3d 1001, 1011 (7th Cir. 1998)), we cannot conclude that Unum’s interpretation is reasonable.

The remaining question is whether the diagnosis of disabling fibromyalgia in the present case was based primarily on Weitzenkamp’s self-reported symptoms or on objective medical evidence. Weitzenkamp was diagnosed following the 18-point “trigger test” for the condition. We have recognized that the trigger test can “more or less objectively” establish the disease where the findings of the test are consistent with fibromyalgia. Hawkins v. First Union Corp. Long-Term Disability Plan, 326 F.3d 914, 919 (7th Cir. 2003). Chronister v. Baptist Health, 442 F.3d 648, 656 (8th Cir. 2006), held that the  [**17] claimant’s fibromyalgia was not within the self-reported symptoms limitation in light of that court’s having already accepted that the trigger test “qualifies as a clinical examination standardly accepted in the practice of medicine.” Significantly, even Unum does not dispute that the diagnosis is objectively verifiable. Because the disabling illness in this case, fibromyalgia, is not primarily based on self-reported symptoms, but rather can be based on the verifiable evidence of its manifestations, the self-reported symptoms limitation does not apply in this case. . . .

If you have a claim against Unum and need assistance, feel free to contact my office.

Two Recent 6th Circuit Decisions

Two Sixth Circuit decision released last month upheld the denial of LTD benefits.  In one case, the 6th Circuit held that the decision to terminate LTD benefits was not arbitrary and capricious even though employer failed to properly address SSA finding of disability, but where there were six medical opinions adverse to the claimant, and only one in her favor.  Wooden v. Alcoa, Inc., 2013 U.S.App.Lexis 968 (6th Cir. Jan. 11, 2013).  Likewise, in Combs v. Reliance Std. Life Ins. Co., 2013 U.S.App.Lexis 819 (6th Cir. Jan. 10, 2013), the 6th Circuit upheld an ERISA plan administrator’s decision to deny benefits .  In Combs, a couple of facts are worthy of noting.  First, the claimant apparently refused to submit to an examination requested by the insurance company.  Second, the claimant’s condition seemed to involve primarily “subjective” complaints of limitations without much objective support. And finally, the Court found that it was proper to consider evidence obtained on remand.

LTD Offset of RRA benefits

In Duckworth v. Allianz Life Ins. Co. of N. Am., 2013 U.S.App. Lexis 2132 (11th Cir. Jan. 30, 2013), the long term disability insurance policy provided for an “offset” of disability benefits received by the claimant from the Social Security Administration “or any similar . . . act.” The District Court ruled the provision was ambiguous as applied to the claimant’s receipt of disability benefits under the Railroad Retirement Act (RRA). The 11th Circuit reversed the District Court and held that the RRA is substantially similar to the SSA, and thus, the offset provision was applicable.

If you need help with your long term disability case, click here.

Defeating a Long Term Disability Overpayment Claim

The following excerpt from a recent District Court decision provides a nice summary of the equitable arguments that can be made against a long term disability insurer trying to collect an overpayment:

Kapp v. Sedgwick CMS, 2013 U.S. Dist. Lexis 219 (S.D. Ohio Jan. 2, 2013):

The issue whether a Plan may recover an overpayment is governed by the terms of the Plan, and reviewed under the arbitrary and capricious standard.  In other words, is the recovery of overpayments reasonable.  Davis v. Kentucky Fin. Cos. Ret. Plan, 887 F.2d 689, 696 (6th Cir. 1989).  Generally, if the Plan allows for recovery of the overpayment, an Administrator’s decision to reduce future long term disability benefits will be upheld as reasonable.

The United States Court of Appeals for the Sixth Circuit has stated that, even where a benefits plan unambiguously provides the plan fiduciary a legal right to recoup an overpayment, “equitable principles may limit an ERISA fiduciary’s legal right” to do so. Butler v. Aetna U.S. Healthcare, Inc., 109 F.Supp.2d 856, 862 (S.D. Ohio 2000). ERISA is governed by trust law, not contract law. Wells v. U.S. Steel & Carnegie Pension Fund, Inc., 950 F.2d 1244, 1250 (6th Cir. 1991) (Citing Firestone, 489 U.S. at 110-12). Under trust principles, a trustee or administrator may recoup overpayments to a beneficiary  [*10] “even if the excess payment was the product of a unilateral mistake on the part of the trustee.” Id. at 1255 (Feikens, J., concurring) (Citing Hoffa v. Fitzsimmons, 673 F.2d 1345, 1354, 218 U.S. App. D.C. 163 (D.C. Cir. 1982)). However, such recovery is precluded if the beneficiary relies on the correctness of the amounts to his detriment. Id. (Internal citations omitted).

In determining whether equitable principles bar recovery of a mistaken overpayments to an ERISA plan beneficiary, courts consider six factors: (1) the amount of time which has passed since the overpayment was made; (2) the effect that recoupment would have on that income; (3) the nature of the mistake by the administrator; (4) the amount of the overpayment; (5) the beneficiary’s total income; and (6) the beneficiary’s use of the money at issue. Butler at 862 (citing Wells v. U.S. Steel & Carnegie Pension Fund, Inc., 950 F.2d 1244, 1251 (6th Cir. 1991)).

Defendants seek to recover payments mistakenly made over the course of more than eight years. See supra at 2-4. Moreover, they do so after Plaintiff repeatedly notified the Administrator of his SSDI award, starting the day of the award. Id. These facts alone weigh heavily against Defendants in the equitable analysis.

What is more, Plaintiff relied on the correctness of the amount of his LTD payments, having made innumerable financial decisions based on thereon since February 2002. See supra pp. 3-4; Pl.’s Mot. J. on Administrative R. 7, ECF No. 35. Thus, to require repayment after eight years of what Plaintiff—and Defendants–believed to be correct LTD payments would likely have a severe impact Plaintiff and his family. This impact would likely be far more severe than that on the Trust.

Furthermore, the Court finds that the $162,308.21 figure likewise weighs against Defendants in the equitable analysis, especially in light of the Administrator’s repeated mistakes. The Court finds that large, single-payment lump sums weigh in favor allowing recovery of a mistaken overpayment, whereas a large accumulation of payments over time weighs against such recovery. The record shows that requiring repayment of $162,308.21, accumulated over eight years, would rest a nearly unbearable financial burden on Plaintiff. For the foregoing reasons, the Court concludes that equity bars Defendants’ recovery of its mistaken overpayments from until the date hereof.1


1 The Court’s holding does not  [*12] preclude Defendants from offsetting the amount of Plaintiff’s monthly SSDI benefits beginning the date hereof.

Plaintiff has not carried his burden to establish a claim to continue to receive overpayments into the future. A party may establish equitable estoppel by showing that he or she reasonably relied on a material misrepresentation or omission and thereby suffered damages. Restatement of Contracts 2d § 90 comment a). Plaintiff’s reliance on such misrepresentation must have required him to change his position for the worse. Heckler v. Community Health Services Inc., 467 U.S. 51, 104 S. Ct. 2218, 81 L. Ed. 2d 42 (1984). Plaintiff has not established that he has changed his position for the worse in the future in a manner meriting continued payments at the same rate. C.f. DiTommaso v. Union Cent. Life Ins. Co., 1991 U.S. Dist. LEXIS 9159, 1991 WL 124601, *5 (E.D. Pa. 1991).

IV. Conclusion

Plaintiff claimed that equity barred Defendants’ recovery of its mistaken overpayments of long-term disability benefits, which totaled $162,308.21 over a period of eight years. Defendants asserted a counterclaim for the repayment of the full $162,380.21. Because the record supported the Administrator’s decision to require Plaintiff the overpayments, the Court has held that the decision was not arbitrary or capricious. However, the Court has further held that, in light of the eight-year period over which the mistaken overpayments accumulated and other factors, laches bars Defendants’ recovery of the mistaken overpayments. Equitable estoppel does not entitle Plaintiff to continue to receive payments without a Social Security Disability Insurance offset. Each side is to bear its own attorney fees. Plaintiff’s Motion, ECF  [*15] No. 35, is GRANTED with regard to the Laches claim, but DENIED with regard to the claims for estoppel and attorney fees. Defendants’ Motion, ECF No. 34, is DENIED with regard to Plaintiff’s claim for laches and on Defendants’ claim for attorney fees, but granted with regard to Plaintiff’s claim for estoppel. All claims having been resolved, the captioned cause is hereby TERMINATED upon the docket records of the United States District Court for the Southern District of Ohio, Western Division, at Dayton.

Attorney Fees for Long Term Disability ERISA cases

“In an action by [an ERISA] plan participant, the district court, in its discretion, ‘may allow a reasonable attorney’s fee and costs of action to either party.’ ” Moon v. Unum Provident Corp., 461 F.3d 639, 642 (6th Cir. 2006)

“[O]ur circuit recognizes no presumption as to whether  attorney fees will be awarded.” Foltice v. Guardsman Prods., Inc., 98 F.3d 933, 936 (6th Cir. 1996)

The Sixth Circuit applies a five-factor test to determine awarding fees:

(1) the degree of the opposing party’s culpability or bad faith; (2) the opposing party’s ability to satisfy an award of attorney’s fees; (3) the deterrent effect of an award on other persons under similar circumstances; (4) whether the party requesting fees sought to confer a common benefit on all participants and beneficiaries of an ERISA plan or resolve significant legal questions regarding ERISA; and (5) the relative merits of the parties’ positions.

“No single factor is determinative, and thus, the district court must consider each factor before exercising its discretion.” Id. at 642, 643.

Long Term Disability Overpayment – Federal Review

The issue whether a Plan may recover an overpayment is governed by the terms of the Plan, and reviewed under the arbitrary and capricious standard.  In other words, is the recovery of the overpayment is reasonable.  Davis v. Kentucky Fin. Cos. Ret. Plan, 887 F.2d 689, 696 (6th Cir. 1989).  Generally, if the Plan allows for recovery of the overpayment, an Administrator’s decision to reduce future long term disability benefits will be upheld as reasonable.


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