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Stewart v. Bell Atlantic Long Term Disability Plan for Management Employees

United States District Court, Seventh Circuit

December 19, 2013

William Stewart, Plaintiff,
v.
Bell Atlantic Long Term Disability Plan for Management Employees, Defendant.

MEMORANDUM OPINION AND ORDER

THOMAS M. DURKIN, District Judge.

Plaintiff William Stewart brings this action against defendant Bell Atlantic Long Term Disability Plan for Management Employees to recover benefits under the terms of a long term disability plan offered by his former employer. In his complaint, Stewart sets forth a single claim under § 502(a)(1)(B) of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132(a)(1)(B). Presently before the Court are the parties' cross-motions for summary judgment. R. 17; R. 23. For the reasons explained below, defendant's motion for summary judgment is granted, and Stewart's motion for summary judgment is denied.

Background[1]

The material facts in this case are undisputed. Stewart was a participant in the Bell Atlantic Long Term Disability Plan for Management Employees (the "LTD Plan") by virtue of his employment with Verizon Communications Inc. ("Verizon").[2] DSMF ¶ 2; PR ¶ 2. On February 23, 2001, however, Stewart's employment was terminated due to a "reduction in force." DSMF ¶ 8; PR ¶ 8. At the time of his discharge, Stewart signed a separation agreement and release in exchange for a "cash separation payment" of $63, 840. Def. Exh. 14 at 5; DSMF ¶ 9; PR ¶ 9. By signing this agreement, Stewart waived numerous potential claims against Verizon; however, he retained the right to seek benefits under the LTD Plan. Def. Exh. 11 at 19; PR ¶ 9.

Stewart spent the next several years attempting to collect Social Security Disability Insurance ("SSDI") benefits. DSMF ¶ 11; PR ¶ 11. On November 15, 2002, an Administrative Law Judge ("ALJ") found that Stewart was not disabled and declined to award him SSDI benefits. Def. Exh. 18 at 1-2. The case was later reopened, however, and on June 28, 2005, a different ALJ awarded Stewart SSDI benefits after finding that he had been under a disability since February 23, 2001, the date that he was discharged from Verizon.[3] Id. at 2-3.

Stewart's Claim for LTD Plan Benefits

On March 19, 2006, more than five years after leaving Verizon, Stewart submitted a claim for benefits under the LTD Plan. DSMF ¶ 11; PR ¶ 11. Stewart asserted, based on the decision of the ALJ, that he was "in essence disabled the date [he] separated from Verizon." Def. Exh. 18 at 1. As a result, Stewart claimed that he was entitled to collect LTD Plan benefits since February 23, 2001. Id.

Section 4 ("Long Term Disability Benefits") of the LTD Plan sets forth the requirements that a claimant must meet in order to receive long term disability benefits. Def. Exh. 3 at 2. Specifically, Section 4.1 ("Commencement of Benefits") states that:

Subject to the terms and conditions of this Section 4, and except as otherwise provided in the [LTD] Plan, an Employee enrolled in the [LTD] Plan who is disabled, as determined by the Benefits Administrator, upon the expiration of the applicable Waiting Period and his/her termination of employment with Company and its Affiliates, shall receive long term disability benefits under the [LTD] Plan, provided the Employee makes timely and proper application for such benefits in accordance with Section 4.6 ("Application for Benefits") and such application is approved.

Def. Exh. 1 at 12. Section 2 ("Definitions") defines the term "Waiting Period" as:

A continuous period of twenty-six (26) weeks following the date an Employee is last Actively at Work (not including one week of incidental absence), during which the Employee is eligible to receive sickness disability benefits under the SADBP (or any other short term disability plan in which the Employee participates) and for which no benefits are payable under the [LTD] Plan.

Id. at 10. The term "SADBP" refers to the Sickness and Accident Disability Plan for Bell Atlantic Employees (the "STD Plan"), which serves as a short term disability plan for qualifying employees. Id. at 9.

Stewart's claim was referred to the Verizon Claims Review Unit ("VCRU"), which is the designated claims administrator for the LTD Plan. DSMF ¶ 12; PR ¶ 12. On October 10, 2006, the VCRU informed Stewart that his claim was denied due to his failure to exhaust the applicable Waiting Period. Def. Exh. 3 at 2. The VCRU recognized that Stewart had received short term disability benefits on several occasions during his employment with Verizon. Id. at 3. Most recently, Stewart had collected benefits under the STD Plan between September 25, 2000 and November 15, 2000. Id. at 2. However, the VCRU explained that none of Stewart's periods of short term disability amounted to twenty-six continuous weeks, and Stewart returned to work after each period of short term disability. Id. at 1-2.

On March 29, 2007, Stewart appealed the denial of benefits to the Verizon Claims Review Committee ("VCRC"), which is the designated appeals administrator for the LTD Plan. DSMF ¶ 15; PR ¶ 15. Stewart stated that he believed he was entitled to benefits because he was covered by the LTD Plan on his last day of employment. Def. Exh. 4 at 2. After admitting that he did not receive short term disability benefits for a continuous period of twenty-six weeks following his last day of employment, as required by the Waiting Period, Stewart asserted that his "last day of work [was] February 23, 2001, so [his] eligible benefit date [under the LTD Plan] would be sometime in August of 2001." Id.

The VCRC considered Stewart's appeal at its May 10, 2007 meeting, and the decision of the VCRU was upheld. DSMF ¶ 17; PR ¶ 17. The VCRC explained, in a similar fashion, that Stewart had failed to exhaust the applicable Waiting Period, which serves as a prerequisite to receiving benefits under the LTD Plan. Def. Exh. 5 at 2. Stewart was subsequently informed of his right to bring a civil action under ERISA. Id. at 4.

Federal Court Proceedings

On October 9, 2009, Stewart filed a complaint in the Circuit Court of Cook County to recover benefits under the LTD Plan. DSMF ¶ 19; PR ¶ 19. Defendant later removed Stewart's lawsuit to this Court. DSMF ¶ 19; PR ¶ 19. On November 9, 2010, the Court (Guzman, J.) remanded the matter back to the plan administrators for a specific determination "as to whether [Stewart] was eligible for short term disability benefits for a continuous period of twenty-six weeks following the last day he was actively at work." Stewart v. Bell Atl. Long Term Disability Plan for Mgmt. Emps., No. 09 C 7012, 2010 WL 4688981, at *3 (N.D. Ill. Nov. 9, 2010). The Court noted that the prior decisions of the VCRU and the VCRC focused on when Stewart actually received short term disability benefits, but that the Waiting Period of the LTD Plan only required Stewart to be eligible to receive them. Id. at *2. Remand was appropriate, the Court explained, because the LTD Plan did not set forth the eligibility requirements for short term disability, and the STD Plan was not part of the record. Id. at *2-*3.

Consideration of the Court's Remand Order

On January 24, 2011, after considering the Court's remand order, the VCRU determined that "Stewart was not eligible for short term disability benefits for a continuous period of twenty-six weeks following the last day he was actively at work, " and therefore did not qualify for LTD Plan benefits. Def. Exh. 7 at 4. In support of its decision, the ...


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