United States District Court, D. Minnesota
Mark S. Bowers, Plaintiff,
Life Insurance Co. of North America, Defendant
[Copyrighted Material Omitted]
Denise Yegge Tataryn, Esq., Brian R. Christiansen, Esq., and KrisAnn Norby-Jahner, Esq., Hellmuth & Johnson PLLC, Edina, MN, on behalf of Plaintiff.
Daniel K. Ryan, Esq., and Michael T. Berger, Esq., Hinshaw & Culbertson LLP, Chicago, IL, and Minneapolis, MN, on behalf of Defendant.
MEMORANDUM OPINION AND ORDER
ANN D. MONTGOMERY, U.S. DISTRICT JUDGE.
On March 7, 2014, the undersigned United States District Judge heard oral argument on Plaintiff Mark S. Bowers's and Defendant Life Insurance Co. of North America's (" LINA" ) cross-motions for summary judgment [Docket Nos. 22, 28]. The parties dispute whether Bowers is eligible for a life waiver of premium benefit under a plan administered by LINA. For the reasons set forth below, Bowers's motion for summary judgment is granted and LINA's motion for summary judgment is denied.
A. Employment with C.H. Robinson
Plaintiff Bowers began working for C.H. Robinson Worldwide, Inc. (" C.H. Robinson" ) on March 1, 1996, and eventually reached the position of Corporate Sales Director. Michael T. Berger Aff. [Docket No. 25] Ex. 1 (" Admin. Record" ) at 509. On December 26, 2007, Bowers stopped working due to coronary artery disease. Two days later, on December 28, 2007, Bowers underwent emergency quadruple bypass surgery. See id. at 910, 1479. Bowers's recovery was arduous and prolonged. He suffered from a staph infection requiring four or five debridement operations, and underwent extensive physical therapy. Id.
On June 27, 2008, Bowers returned to work. Bowers and C.H. Robinson agreed Bowers would return at a lower position, that of Consulting Services Manager.
Bowers received the same salary as before but his potential for earning bonus compensation was significantly reduced. Bowers also agreed to a reduced work schedule with the goal of increasing his hours to full-time. Id. at 1214.
Approximately one year later, on June 13, 2009, Bowers again left his employment due to health concerns. In August 2009, Bowers underwent a " total sternal reconstruction procedure," as well as a muscle flap reconstruction involving his pectoralis muscles. Id. at 910. Bowers did not return to employment.
Also in August 2009, Bowers applied for long-term disability (" LTD" ) benefits under the benefits plan administered by LINA (the " Plan" ). In his application for benefits, Bowers's former counsel wrote that C.H. Robinson had accommodated Bowers's disability by moving him to a " staff consultant" position. Counsel also wrote that Bowers had been able to work only " about 25 hours per week due to his ongoing disability." Id. at 1196. In November 2009, C.H. Robinson employee Robyn Kippley prepared an employment summary, reviewed it for accuracy with Bowers, and then forwarded it to LINA. Id. at 1212. On December 21, 2009, LINA approved Bowers's claim for LTD benefits, finding his disability to have started on December 27, 2007. Id. at 401.
B. Waiver-of-Premium Benefits
In addition to LTD benefits, the Plan provides employees with life insurance coverage through a policy issued by LINA (the " Life Policy" ). Id. at 1825-57. The Life Policy divides employees into three classes, and states that a Class 2 Employee will only qualify for the life insurance benefit if he has been " regularly working a minimum of 30 hours per week." Id. at 1827. The parties agree C.H. Robinson categorized Bowers as a Class 2 Employee.
The Life Policy waives the payment of premiums (referred to as the " WOP" benefit) for employees qualified as " disabled." An employee is " disabled" under the Life Policy when the employee " is unable to perform the material and substantial duties of his or her occupation" due to injury or sickness. Id. at 1855. This is referred to as the " own occupation" standard of disability. After 12 months, however, the employee will only continue to be considered " disabled" if " he or she is unable to perform the material and substantial duties of any occupation for which he or she is or may reasonably become, qualified for." Id. at 1855 (emphasis added). This is often referred to as the " any occupation" standard, or " total disability." After a 180-day " Benefit Waiting Period," an employee qualifying for the WOP benefit receives coverage under the Life Policy without paying premiums, and the coverage continues until the employee is no longer disabled or a maximum benefit period is reached. See id. at 1842.
1. Initial Claim
In December 2009, the same month LINA approved LTD benefits, Bowers also applied for the WOP benefit. On January 19, 2010, LINA approved Bowers's claim in part. Id. at 384-85. LINA agreed Bowers retroactively qualified for the WOP benefit from June 27, 2008, until December 26, 2008. Id. LINA concluded Bowers first became " disabled" under the " own occupation" standard when he left work for his quadruple bypass surgery on December 26, 2007. The 180-day " Benefit Waiting Period" then delayed Bowers's WOP benefit until June 27, 2008, at which time it applied until December 26, 2008. Id. At that point, however, LINA essentially concluded that Bowers had fallen in
the coverage gap between " totally disabled" and regular " employee." See id. After 12 months under the " own occupation" standard of " disability," the Life Policy moved to the " any occupation" standard. Because Bowers had returned to work as a sales consultant by this time, he did not qualify as " disabled" under the " any occupation" standard. At the same time, LINA concluded Bowers had not been " regularly working a minimum of 30 hours per week," meaning Bowers had not met the basic life insurance eligibility requirements for Class 2 Employees. LINA thus denied the remainder of Bowers's claim, finding Bowers had failed to demonstrate that he had ...