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COSTANTINO v. WASHINGTON POST MULTI-OPTION BENEFITS PLAN

August 14, 2005.

PAUL COSTANTINO, Plaintiff,
v.
WASHINGTON POST MULTI-OPTION BENEFITS PLAN, Defendant.



The opinion of the court was delivered by: COLLEEN KOTELLY, District Judge

MEMORANDUM OPINION

Plaintiff brings suit under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et. seq. ("ERISA"). Plaintiff seeks an Order clarifying his rights as a plan beneficiary to past and future benefits under the terms of an employee welfare plan. Compl. ¶ 2. Specifically, Plaintiff seeks an order declaring that: (1) no deference be granted to the decision of Defendant to terminate benefits; (2) Plaintiff is entitled to long-term disability payments under his long-term disability policy; (3) Plaintiff is entitled to payment of past and future long-term disability benefits; (4) Plaintiff is entitled to payment of pre- and post-judgment interest; and (5) Plaintiff is entitled to payment of attorney's fees and costs. Id. at 4.

Pending before the Court are the parties' cross motions for summary judgment and supporting documents. After carefully considering the pleadings, the relevant case law and the entire record, the Court will grant Defendant's Motion for Summary Judgment and deny Plaintiff's motion. I: FACTUAL BACKGROUND

  The Court begins its discussion of the facts by noting that this Court strictly adheres to the text of Local Civil Rule 56.1. As such, in resolving the present summary judgment motions, the Court "assumes that facts identified by the moving party in its statement of material facts are admitted, unless such a fact is controverted in the statement of genuine issues filed in opposition to the motion." LCvR 56.1. Thus, in most instances the Court cites to Defendant's Statement of Material Facts As To Which There is No Genuine Issue ("Def.'s Stmt.") unless such statement is contradicted by Plaintiff in her Statement of Genuine Issues ("Pl.'s Stmt.").*fn1 The Court also cites directly to the record, where appropriate, to provide additional information not covered in either of the parties' statements. Having set forth these preliminaries, the Court moves to a discussion of the material facts not genuinely in dispute.

  Plaintiff is a former employee of the Washington Post (the "Post").*fn2 Pl.'s Stmt. for Pl.'s Mot. ¶ 1. He worked in the Post's mailroom for twenty five years, beginning at age 16.*fn3 Id. In July 1995, Plaintiff was injured in a non-work related automobile accident in which he suffered multiple leg fractures. Id. ¶ 3. Plaintiff stopped working for the Post in January 2000 and filed an application for long-term disability benefits under the Washington Post Long-Term Disability Plan ("LTD Plan"). Def.'s Stmt. for Pl.'s Mot. ¶ 4.

  The Post established the LTD Plan on June 1, 1983 to provide benefits to employees of the Post and its subsidiaries (collectively referred to as the "Post") who became disabled during their period of employment. Def.'s Stmt for Def.'s Mot. ¶ 1. The LTD Plan is subject to the provisions of ERISA. Id. The Post provides several employee welfare plans to its employees. Id. ¶ 2. These welfare benefit plans are summarized in various summary plan descriptions ("SPDs") that are provided to participants as required by ERISA. Id. The SPDs typically describe a benefits program that consists of all the welfare benefits available to a particular group of employees. Id. Since 1983, the LTD Plan has been summarized in various SPDs, including the Multi-Option Benefits Program SPD, effective January 1, 1999 (the "1999 SPD"). Id.

  The 1999 SPD granted the Post, as Plan Administrator, discretionary authority to determine participants' eligibility for benefits and interpret provisions for the LTD Plan. Id. ¶ 3. The Post delegated this discretionary authority to The Prudential Insurance Company of America ("Prudential"). Id. ¶ 4.*fn4

  On May, 28, 1998, the Post mailed a letter to all mailroom employees announcing the availability of two new benefit options including an increased payment option for the Accident and Sickness Insurance Plan ("A & S Plan") and the LTD Plan. Id. ¶ 8. The letter announced a special enrollment period from June 1, 1998 to June 19, 1998, during which eligible employees could enroll in the two new benefit options. Id. The letter described the LTD Plan, stating that the "LTD [Plan] enables you to receive part of your income while you are totally disabled." Id. The letter also defined "total disability:"

 
For up to two years, total disability means that you are wholly and continuously unable to perform the duties of the job you held when you became disabled. You must be under the regular care and attendance of a legally qualified physician. You will not be considered totally disabled if you engage in any occupation or perform any work for compensation or profit. ("own-occupation" standard)
After two years, you are considered totally disabled if you are unable to engage in any kind of work for which you are, or reasonably could become, qualified by your education, training or experience. ("any-occupation" standard) Id.*fn5 Attached to the letter was a form entitled "Special 1998 Enrollment Form," which eligible employees could use to select coverage under the LTD Plan and authorize the Post to deduct the necessary contributions from their salary for the coverage. Id.
  Plaintiff testified that he did not remember receiving the letter, but there is no dispute that he executed the special 1998 enrollment form on June 4, 1998, and elected coverage under the LTD Plan. Pl.'s Stmt. for Def.'s Mot. ¶ 9. Plaintiff's benefits coverage was consolidated in the Multi-Option Benefits Program. Def.'s Stmt. for Def.'s Mot. ¶ 10. The Multi-Option Benefits Program offered participation in a number of component plans for certain groups of employees at the Post, including the A & S, LTD, and Business Travel Accident Plans. Id. The coverages available were described in the 1999 SPD. Id.

  The two-part definition of total disability (the own occupation-standard followed after two years by the any-occupation standard) was omitted from the 1999 SPD. Id. ¶ 11. According to Section Seven, the section of the 1999 SPD entitled "Long Term Disability Plan," the LTD Plan "pays benefits in the form of monthly income payments to covered employees after a defined period of total disability." (emphasis in original). 1999 SPD at 7-1; Administrative R.("AR") at 63. The bold type indicates that the term "total disability" should have been defined in the 1999 SPD's glossary, but it is not there in the context of the LTD Plan. 1999 SPD at 1, 14-1-6; AR at 12, 93-98. The two-part definition for total disability does, however appear in the original LTD Plan document, and since the LTD Plan's inception in 1983, has been consistently applied to claims for covered employees of the Post under the LTD Plan. Def.'s Stmt. for Def.'s Mot. ¶ 11.

  The 1999 SPD did include a definition of total disability, but only for purposes of the Business Travel Accident Plan. Id. ¶ 12. In the 1999 SPD, total disability for the Business Travel Accident Plan was defined under the any-occupation standard. Id. Plaintiff does not dispute this. According to the 1999 SPD, medical disability claims used the own-occupation standard. 1999 SPD at 14-5; AR at 97. Plaintiff argues that in the absence of a definition for total disability in the 1999 SPD, that the definition of "medical disability" which is included in the SPD for the A & S Plan and uses the own-occupation standard, applies to his LTD Plan claim. Pl.'s Stmt. for Def.'s Mot. ¶ 12; 1999 SPD at 14-5; AR at 97. This is a legal, not factual dispute, and will be discussed below.

  On May 8, 2000, Plaintiff filed a claim for long-term disability benefits under the LTD Plan. Def.'s Stmt. for Def.'s Mot. ¶ 13. On July 17, 2000, Prudential denied Plaintiff's claim because he did not satisfy the own-occupation standard. Id. ¶ 14. In this, and all subsequent correspondence regarding Plaintiff's claim, Prudential recited the LTD Plan's two-part definition of total disability. Id. Following appeals, Prudential approved Plaintiff's claim on March 19, 2001, retroactive to July 17, 2000. Id. ¶ 15. On February 4, 2002, Prudential notified Plaintiff of the impending change from the own-occupation to the any-occupation standard which would occur after two years. Id. ¶ 16.

  Prudential then requested that Plaintiff complete forms for evaluation of his total disability under the any-occupation standard. Id. Plaintiff signed the forms on February 26, 2002 and returned them to Prudential. Id. In a letter dated May 1, 2002, Prudential notified Plaintiff that his benefits would be terminated on July 16, 2002 because he did not satisfy the any-occupation standard, applicable after the expiration of the initial two years. Id. ¶ 17. Plaintiff appealed that decision in a May 7, 2002 letter. Id. ¶ 18. In that letter, Plaintiff did not challenge Prudential's application of the any-occupation standard to his claim. Id. Rather, Plaintiff contested Prudential's conclusion that he did not satisfy that standard. Id. Prudential denied Plaintiff's appeal. Id. Plaintiff responded to this denial with a letter dated August 3, 2002, in which he asserted, for the first time, that the any-occupation standard did not apply to his claim under the LTD Plan because it was not included in the 1999 SPD. Id.

  Following subsequent appeals, Prudential issued its final decision in an August 20, 2003 letter in which it affirmed that it had applied, and would apply, the any-occupation standard to Plaintiff's claim for continuing long-term disability benefits. Id. ¶ 19. In that letter, Prudential provided ASA No. 39922, the agreement between the Post and Prudential effective June 1, 1983. Id. Prudential marked with a yellow tab the definition of disability it was using from the original LTD Plan. Id. That definition uses the two-part definition of total disability, meaning that after the initial two-year period of disability (in Plaintiff's case, this would have begun on July 17, 2000) the participant must be "unable to engage in any gainful occupation for which he or she is reasonably suited by training, education, or experience," in order to receive benefits under the LTD Plan. Id. (quoting Def.'s Mot. for Summ. J. Ex. D (Moran Aff.) ¶ 6.).

  Because the Post had not provided this definition in the plan documents it had previously provided to Plaintiff, Prudential extended Plaintiff's benefits through October 2003, an additional fifteen months beyond the initial twenty-four month period. Id. Prudential also reiterated to Plaintiff that the any-occupation standard would be used to evaluate future eligibility benefits beyond October 2003. Id. In a letter dated November 14, 2003, Plaintiff, through counsel, informed Prudential that he took the August 20, 2003 letter as a final denial of his claim and asserted that he was entitled to long-term disability benefits under the own-occupation standard until he reached age 65. Id. ¶ 20. In the same ...


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