Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.


United States District Court, N.D. Illinois

November 19, 2004.


The opinion of the court was delivered by: JAMES ZAGEL, District Judge

On September 7, 2004, I granted Defendant Prudential Insurance Co.'s ("Prudential") motion in limine to apply an arbitrary and capricious standard of review and to limited discovery accordingly. Plaintiff has asked me to reconsider my ruling, arguing that this case should be reviewed under a de novo standard, which would entitle Plaintiff to a broader range of discovery.

The proper standard of review for a denial of benefits challenged under the Employee Retirement Income Security Act ("ERISA") is de novo "unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). When the plan gives an administrator, such as Prudential, the authority to interpret or apply the plan, the arbitrary and capricious standard of review applies. Wilczynski v. Kemper Nat'l Ins. Cos., 178 F.3d 933, 934 (7th Cir. 1999). To determine whether the administrator has discretionary authority, courts look to the language of the plan itself. Postma v. Paul Revere Life Ins. Co., 223 F.3d 533, 538 (7th Cir. 2000); O'Reilly v. Hartford Life & Accident Ins. Co., 272 F.3d 955, 959 (7th Cir. 2001). In Hertzberger v. Standard Ins. Co., 205 F.3d 327, 331 (7th Cir. 2000), the Seventh Circuit found that to properly delegate discretionary authority to the administrator, the plan must make that delegation sufficiently clear to the holder of the plan. The Court stated: "the mere fact that a plan requires a determination of eligibility . . . or requires proof or satisfactory proof of the applicants claim . . . does not give the employee adequate notice that the plan administrator is to make a judgment largely insulated from judicial review by reason of being discretionary." Id. at 332. As an example of an adequate provision, the Court provided the following "safe harbor" language: "Benefits under this plan will be paid only if the plan administrator decides in his discretion that the applicant is entitled to them." Id. at 331. The Court noted, however, that this specific clause was not required to reserve discretionary authority, recognizing that less explicit language may still provide the "requisite if minimum clarity" to confer discretionary authority on the plan administrator. Id. As an example of a less explicit but still satisfactory provision, the Court highlighted the language of the benefits plan in Donato v. Metropolitan Life Ins. Co., 19 F.3d 375 (7th Cir. 1994), which required a submission of proof "satisfactory to us" (the plan administrator). The Court explained that "the `to us' signaled the subjective, discretionary character of the judgement that was to be made." Id. (citing Donato, 19 F.3d at 379).

Plaintiff's plan contains language similar to that found in Donato. In the section on Long Term Disability Benefits, under the heading "What Information Is Needed as Proof of Your Claim?", Plaintiff's plan states: "We may request that you send proof of continuing disability, satisfactory to Prudential, indicating that you are under the regular care of a doctor." This, Plaintiff argues, is not clear enough to confer discretionary authority. After reading the plan provisions, I must disagree. The phrase "satisfactory to Prudential" modifies the phrase "proof of continuing disability", clearly demonstrating that any proof submitted upon a claim for benefits must meet Prudential's subjectively determined criteria. Diaz v. Prudential Ins. Co., No. 03 C 2702, 2004 U.S. Dist. LEXIS 8640 at *21-22 (N.D. Ill. May 12, 2004); DiPietro v. Prudential Ins. Co., No. 03 C 1018, 2003 U.S. Dist. LEXIS 16400 at *4 (N.D. Ill. Sept. 16, 2003). This language was sufficient to put Plaintiff on notice of the Administrator's discretionary authority and to trigger an arbitrary and capricious standard of review. Domato at 380; See Also Diaz at *4, DiPietro at *22. Since the arbitrary and capricious standard of review is appropriate, I find that discovery should be limited to the administrative record.

  For the reasons given above, Plaintiff's Motion for Reconsideration is GRANTED. However, I stand by my prior ruling.


© 1992-2004 VersusLaw Inc.

Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.