Ralph Van Deventer worked for Johnson & Johnson (Johnson) as a Compliance Analyst until he became disabled from multiple weaknesses in his skeletal structure and tenosynovitis of the left ankle. Van Deventer was enrolled in Johnson’s Long Term Disability Income Plan for Choice Eligible Employees (the “Plan”), which had two different, time-sensitive definitions of “disabled.”
According to the Plan, during the first 12 months of disability, he needed to only show that he was unable to perform the essential functions of his regular job with or without reasonable accommodation. After that, he needed to show that he was unable to perform any job in the company for which he was—or could reasonably could become—qualified with or without reasonable accommodation. Van Deventer received benefits from the time he filed in 2009 until 2010. After one year, the Plan Administrator determined that he wasn’t so disabled as to be unable to perform “any job” as required by the Plan for an award of long-term disability benefits.
Van Deventer underwent four independent medical examinations, a functional capacity evaluation, and two independent physician reviews. In February 2010, the Pension Committee denied Van Deventer long-term disability benefits. He appealed to the Plan Administrator, and the appeal was denied. Van Deventer filed a second appeal that was also denied.
Van Deventer filed a complaint against the Pension Committee in December 2010 which alleged that the company terminated the benefits owed to him from the Plan pursuant to the Employee Retirement Income Security Act (“ERISA”). The District Court remanded the case to the Plan Administrator “to verify a physician’s diagnosis and opinion, and to re-evaluate the findings and opinion of the Plan Administrator.” Van Deventer then moved for reconsideration, arguing that, based on the Third Circuit’s decision in Miller v. American Airlines, Inc. (3d Cir. 2011), the District Court didn’t have the authority to remand a decision to terminate if it couldn’t affirm the Plan Administrator’s decision. The District Court denied the motion for reconsideration without addressing the applicability of Miller and ordered the doctor to issue a new report within 30 days. It also ordered that the Plan Administrator render a decision within 30 days of receiving the doctor’s response.
The Plan Administrator again concluded that Van Deventer was not unable to perform any job and denied long-term disability benefits. More motions followed and the District Court granted the Pension Committee’s motion for summary judgment.
Van Deventer argued on appeal that the District Court didn’t have authority to remand the case to the Plan Administrator and that the Plan Administrator’s denial of benefits was arbitrary and capricious.
Senior Circuit Judge Dolores Korman Sloviter wrote the opinion of the United States Court of Appeals, Third Circuit. She stated that under Miller v. American Airlines, Inc., the Third Circuit concluded that the Plan Administrator abused his discretion in terminating the employee’s benefits and ordered retroactive reinstatement of benefits. The appellate court held that the proper remedy was to reinstate benefits rather than remand to the Plan Administrator, based in large part on restoring the status quo. However, Judge Sloviter wrote that Van Deventer failed to acknowledge the differences between Miller and his case. In Miller, the benefits were suddenly terminated after four years. But here the Plan Administrator denied the long-term benefits in the first instance after the initial award of benefits. Van Deventer knew that as of March 2009, his initial period of benefits would expire and he would be subject to a “thorough evaluation” of his claim. His denial of long-term benefits occurred at the first time he could have qualified, unlike the situation in the Miller case.
Judge Sloviter and the Third Circuit held that the District Court never concluded that the Plan Administrator abused his discretion as in Miller, only that clarification was necessary. In addition, based on the appellate court’s independent review of the record in Van Deventer case, there was no basis to conclude that the Plan Administrator abused his discretion.
Van Deventer also presented arguments in an attempt to demonstrate that the Plan Administrator’s denial of his benefits was arbitrary and capricious. These were also held to be meritless claims. The Plan Administrator relied on the conclusions of four different doctors that Van Deventer was capable of performing sedentary work. Additionally, his personal doctor concluded that he was capable of performing sedentary work for three to six hours a day. The Third Circuit Judge pointed out in her opinion that the Plan Administrator’s denial specifically stated that the evaluation looked at “all documentation related to Mr. Van Deventer’s claim” and listed the medical records and reports submitted by the physical therapist.
Given the uniformity among the doctors in recommending that Van Deventer could perform sedentary duty either with or without restrictions, the Third Circuit held that it couldn’t conclude that the Plan Administrator was arbitrary and capricious in concluding that Van Deventer was capable of performing sedentary duty with restrictions or limitations.
As a result, the Third Circuit affirmed the District Court’s grant of Johnson & Johnson Pension Committee’s motion for summary judgment and denied the motion by Van Deventer.
Van Deventer v. Johnson & Johnson Pension Committee of Johnson & Johnson, — Fed.Appx. —-, 2013 WL 5878909 (C.A.3 (N.J.) Nov. 4, 2013)
This type of situation may arise in your company. If you need assistance with employment issues or any other corporate and business matters, contact Ravinder S. Nagi, Chair of the Litigation Practice Group, at BoltNagi PC. BoltNagi PC is one of the largest firms in the United States Virgin Islands and has experienced legal professionals in employment and corporate matters to assist companies in or seeking to relocate to the U.S. Virgin Islands.