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HUNTER v. METROPOLITAN LIFE INS. CO.

March 6, 2003

MARGARET HUNTER, PLAINTIFF,
v.
METROPOLITAN LIFE INSURANCE COMPANY, ET AL. DEFENDANTS.



The opinion of the court was delivered by: Huvelle, District Judge.

MEMORANDUM OPINION

Plaintiff has brought suit under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001, challenging the denial of long-term disability benefits under the employee welfare benefit plan ("Plan") that had been established and maintained by her former employer, KPMG, LLP. The long-term disability ("LTD") benefits are made available to Plan participants pursuant to a group disability income insurance policy issued by defendant Metropolitan Life Insurance Company ("MetLife").

Plaintiff argues that MetLife's denial of her LTD benefits claim constitutes a breach of the terms of the Plan (Count One) and that KPMG breached its fiduciary duty by failing to assist her in obtaining these benefits (Count Two). Plaintiff claims that the denial was arbitrary and capricious and has moved for summary judgment on this basis. Defendant Metlife has moved for summary judgment based on plaintiff's failure to exhaust administrative remedies available under the Plan before filing suit. Defendant KPMG moves for dismissal on the same basis, but also argues that it is not liable for MetLife's decisions regarding plaintiff's LTD benefits claim, and second, that even if KPMG could be legally responsible for MetLife's handling of plaintiff's claim, MetLife's actions were not arbitrary or capricious.

The Court concludes that plaintiff failed to exhaust the available administrative remedies prior to filing suit and that KPMG is not liable as a fiduciary for MetLife's determination of plaintiff's claim. Therefore, defendants' motions are granted and plaintiff's motion is denied.

BACKGROUND

Plaintiff, Margaret Hunter, was employed by defendant KPMG in Washington, D.C. as a director in Corporate Restructuring during all relevant times. (Compl. ¶ 6.) As a KPMG employee, she was eligible to participate in KPMG's employee welfare benefit plan ("Plan"), which provides for disability benefits through an insurance policy issued by MetLife. (Defendant MetLife's Brief in Support of its Motion for Summary Judgment ["ML's Br."] Ex. 1 at ML 4404.)*fn1

The letter notifying plaintiff of the withdrawal of her claim also notified plaintiff of her right to request a review of the determination. (Id. at 132.) On October 1, 2001, plaintiff submitted the claim for review with documentation indicating that she was not able to return to work. (Id. at 121.) She submitted additional documentation to support the reinstatement of her claim on October 19, 2001. (Id. at 100-01.) In a letter to plaintiff dated November 7, 2001, MetLife acknowledged receipt of the request for review and documents, noted that benefits could not be reinstated, and advised plaintiff that the claim had been referred for independent review. (Id. at 95.) The letter stated that plaintiff would be informed of a decision or of the need for additional time to review the claim within sixty days. (Id.) In a December 19, 2001 letter, MetLife indicated to plaintiff that additional time was needed "to complete a full and fair review." (Memorandum of Points and Authorities in Support of the Motion of KPMG LLP to Dismiss or, in the Alternative, for Summary Judgment ["KPMG Mem."] Ex. 18a.) Plaintiff submitted further documentation in support of her claim on December 28, 2001 and January 3, 2002. (ML 364-67, 397-401.) On January 23, 2002, prior to receiving a determination on the review of its claim, plaintiff filed this suit.

On April 5, 2002, MetLife informed plaintiff that the review of her claim was complete and that it remained withdrawn as of September 6, 2001. (KPMG Mem. Ex. 22.) At that time plaintiff was also informed that she could appeal this decision within 180 days. (Id.) Plaintiff appealed on June 20, 2002 (ML 402), and thereafter submitted approximately four thousand pages of additional records to support the appeal. (ML's Br. at 6.) On October 11, 2002, during the course of the review process, MetLife requested that plaintiff undergo an independent medical exam (IME). (KPMG Mem. at 12-13; KPMG Mem. Ex. 23.) The Plan specifically provides MetLife with the right to request an IME and to deny benefits based on a claimant's failure to do so.*fn3

Plaintiff refused to have the IME (KPMG Mem. Ex. 24), and as a result, MetLife, by letter dated November 7, 2002, upheld its original determination denying the LTD benefits claim on the grounds that plaintiff had refused to undergo the IME. (Id. Ex. 25.) On November 15, 2002, after receipt of this denial letter, plaintiff notified Metlife that she would submit to an IME. (Id. Ex. 26.) However, plaintiff refused to agree to an extension of MetLife's December 6, 2002 deadline for filing dispositive motions in this case in order to provide time to schedule and conduct the IME, prepare a report, and consider the report in furtherance of plaintiff's appeal. (Id. Ex. 27.) Consequently, the appeal process was prematurely curtailed and the motions currently before the Court were filed.

Both MetLife and KMPG have sought dismissal based on plaintiff's failure to exhaust administrative remedies before filing suit. KPMG has also filed a motion for summary judgment arguing that it is not liable for MetLife's decisions regarding plaintiff's LTD benefits claim and that the denial of plaintiff's LTD benefits claim was not arbitrary or capricious. Plaintiff argues that she exhausted administrative remedies because the suit was not filed until after her claim was denied on September 6, 2001 and November 7, 2001, or alternatively, administrative remedies were exhausted on November 7, 2002, when her appeal was denied for her refusal to undergo an IME. (Pl.'s Reply at 1.) She also argues that KPMG is liable as a fiduciary for MetLife's denial of her claim. Finally, although she provides no record basis for this conclusion, she moves for summary judgment arguing that the denial was arbitrary and capricious.

LEGAL ANALYSIS

I. ERISA's Exhaustion Requirement

It is well established that parties aggrieved by decisions of a pension plan administrator must exhaust the administrative remedies available to them under their pension plans before challenging those decisions in court unless "exceptional circumstances" exist.*fn4 Communications Workers of American v. American Telephone and Telegraph Co., 40 F.3d 426, 428, 431 (D.C. Cir. 1994). ERISA does not specifically require the exhaustion of remedies available under pension plans but courts have uniformly applied this requirement as a matter of judicial discretion.*fn5 Id. at 432 (citing Committee of Blind Vendors v. District of Columbia, 28 F.3d 130, 134 (D.C. Cir. 1994) (when claim is not governed by statute requiring exhaustion, ...


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