United States District Court, D. Minnesota
A. Spriggs, Esq. and R.A. Williams Law Firm, counsel for
Christopher M. Busey, Esq., Erin K. Fogarty Lisle, Esq. and
Berens & Miller, P.A., counsel for defendants.
S. DOTY, JUDGE
matter is before the court upon plaintiff's appeal of the
September 1, 2017, order of Magistrate Judge David T. Shultz.
In the order, the magistrate judge denied plaintiff's
request to allow fact and expert discovery.
standard of review applicable to an appeal of a magistrate
judge's order on nondispositive matters is
“extremely deferential.” Reko v. Creative
Promotions, Inc., 70 F.Supp.2d 1005, 1007 (D. Minn.
1999). The court will reverse such an order only if it is
clearly erroneous or contrary to law. 28 U.S.C. §
636(b)(1)(A); D. Minn. LR 72.2(a)(3). After a thorough review
of the file and record, the court finds that the order is
neither clearly erroneous nor contrary to law.
insurance benefit dispute arises out of defendants'
denial of short-term disability benefits to plaintiff Cynthia
Collins, a 3M employee. On June 16, 2016, Collins applied for
short-term disability benefits for her absence beginning June
15. Am. Compl. ¶¶ 10-13. On July 1, defendant
Sedgwick Claims Management Services, Inc., the claims
administrator for 3M's disability plan, denied
Collins's claim because she had not submitted the
required attending physician statement from her medical
provider. Id. ¶ 19. On July 6, 3M received the
attending physician statement, but maintained its denial of
her claim. See id. ¶¶ 22-23. On July 7,
Collins appealed 3M's decision. Id. ¶ 24.
During the appeals process, 3M sought a review of
Collins's claim by an independent physician advisor, Dr.
Daniel Harrop, and informed Collins that he would contact her
physician and therapist, or, alternatively, her physician and
therapist could call him to schedule a phone conference.
Id. ¶¶ 26-27; Spriggs Aff. Ex. C at 17.
Collins alleges that although her physician contacted Dr.
Harrop on July 19, he never returned the calls or spoke with
her physician or therapist. Id. ¶¶ 28-30.
On August 16, 3M denied Collins's appeal. Collins brought
this suit in state court alleging that 3M wrongfully refused
to pay her short-term disability benefits and breached its
fiduciary duties. Defendants timely removed the action to
14, 2017, Collins requested that the magistrate judge grant
expert and fact discovery concerning whether a conflict of
interest or a serious procedural irregularity existed that
affected the administrator's decision. On September 15,
the magistrate judge denied the request. Collins now appeals.
Standard for Discovery
under ERISA, review of the administrator's decision is
“limited to evidence that was before the
administrator.” Jones v. ReliaStar Life Ins.
Co., 615 F.3d 941, 945 (8th Cir. 2010).
“[A]dditional evidence gathering is ruled out on
deferential review, and discouraged on de novo review.”
Brown v. Seitz Foods, Inc. Disability Benefit Plan,
140 F.3d 1198, 1200 (8th Cir. 1998). But a court may allow
additional discovery if the plaintiff shows good cause.
Id. A plaintiff can show good cause by establishing
that the administrative record is insufficient to establish a
“palpable conflict of interest” or a
“serious procedural irregularity.” See Farley
v. Ark. Blue Cross and Blue Shield, 147 F.3d 774, 776
n.4 (8th Cir. 1998) (“A palpable conflict of interest
or serious procedural irregularity will ordinarily be
apparent on the face of the administrative record or will be
stipulated to by the parties. Thus, the district court will
only rarely need to permit discovery and supplementation of
the record to establish these facts.”). However, even
if a plaintiff can show a conflict of interest or serious
procedural irregularity, it does not necessarily entitle a
plaintiff to discovery. See Jones, 615 F.3d at 945
(upholding district court's denial of discovery where
plan administrator admitted there was a conflict of
Conflict of Interest
argues that discovery is necessary to determine whether
3M's relationship with Sedgwick constitutes a conflict of
interest. Collins relies on two voicemail messages left to
Sedgwick by her supervisors inquiring as to the status of her
leave and requesting guidance as to how to fill her position.
See Spriggs Aff. Ex. C at 9. But there is no
evidence that the supervisors attempted to influence Sedgwick
to deny Collins's claim. Therefore, her argument rests on
mere speculation and fails to show good cause. See
Westbrook v. Georgia-Pac. Corp., No. 4:05-CV-01331, 2006
WL 2772822, at *4 (E.D. Ark. Sept. 26, 2006) (internal
quotation marks omitted) (“It is not enough to allege
generally that a conflict of interest may exist or that the
case may have procedural irregularities.”). Even if one
could infer a possible conflict of interest from the
administrative record, Collins has failed to argue why the
record, as currently developed, precludes her from properly
pursuing her claim. As already stated, the existence of a
possible or actual conflict of interest does not
automatically justify additional discovery. See
Jones, 615 F.3d at 945 (noting that additional discovery
is discouraged even where the court reviews an
administrator's decision de novo). Accordingly, the
magistrate judge's conclusion that an alleged conflict of
interest did not justify discovery was not clearly erroneous
or contrary to law.