Saffon v. Wells Fargo & Company Long Term Disability Plan
Filed January 9, 2008
Cite as 05-56824

Dismissal of ERISA Plan by Administrator should be Probed Further

Graciela Saffon worked for Wells Fargo Bank and suffered from degeneration of the cervical spine for a long period of time. Repeated MRI scans and X-rays confirmed her condition. A car accident in December 2001 worsened her condition. This aggravation to her condition, prompted Saffon to quit her desk job and apply for disability benefits from the Wells Fargo & Company Long Term Disability Plan.

The Metropolitan Life Insurance Company or MetLife, was both the plan's insurer and its claims administrator.

MetLife promptly began paying Saffon's short-term disability benefits and, eventually granted and paid her long-term disability benefits. After paying the long-term benefits for a year, MetLife informed Saffron that she no longer met the definition of disability and terminated her long-term benefits.

Saffon availed of the MetLife's administrative appeals process.

MetLife had Saffron's medical records reviewed by two different doctors:

• According to the first doctor, Dr. Thomas, Saffron's file lacks clear sequential, detailed and objective clinical information, which would completely preclude Ms. Saffon from an attempt to return to work.
  
  After the review by Dr. Thomas, MetLife, terminated Saffon's benefits.


• Saffon appealed and included her latest MRI showing that her cervical spine was "not significantly changed" since the MRI taken right after the car crash. She also included a letter from Dr. Kudrow, her treating neurologist, who confirmed that Saffon had undergone various pain treatments "without sustainable benefit" and that she was still "unable to tolerate sustained sitting."

MetLife referred the appeal to a second doctor, Dr. Menotti who remained unconvinced that the claimant's self reported headache and chronic pain syndrome has been enough to preclude her from working.

MetLife noted that it is not clear when Dr. Kudrow used the basis for his diagnosis, as it has not been furnished with the functional capability evaluation that would effectively measure and document her current level of functionality.

The appeal was thereupon denied.

Saffon sued the defendant (Wells Fargo & Co. Long Term Disability Plan under 29 U.S.C. Sec. 1132(a) seeking payment of withheld benefits, attorney's fees, and a declaration that she is disabled.

The District Court denied her relief. In Abatie v. Alta Health and Life Insurance Company, the 9th Circuit Court of Appeals held that:

"When an administrator tacks on a new reason for denying benefits in a final decision, thereby precluding the plan participant from responding to that rationale for denial at the administrative level, the administrator violates the Employment Retirement Income Security Act's (ERISA) procedures."

This procedural violation must be weighed by the district court in deciding whether the Plan administrator has abused its discretion.

Vacating the case, the 9th Circuit Court of Appeals remanded to the District Court for determination of whether the ERISA plan administrator, here in this case, has abused its discretion.