Carugati v. The Long Term Disability Plan For Salaried Employees
Carugati v. The Long
Term Disability Plan For Salaried Employees, 2002 U.S. Dist. LEXIS 4774 (N.D. Ill. Mar. 21 , 2002 )[1]
Carugati's treating physician diagnosed Carugati
with fibromyalgia and chronic fatigue syndrome.
Despite applying the arbitrary
and capricious standard of review the court found the denial of benefits to be
arbitrary and capricious.
The court noted that through
its own terms, the
The court found that not only
did the plan fail to analyze Carugati's physical limitations that could prevent
employment, it neglected to consider Carugati's age, work history, and skills.
In addition to the plan's
failure to assess Carugati's ability to function and engage in employment, the
plan failed to analyze sufficiently the record evidence.
The court also found, as
significant that none of
The court noted that Dr. Kazda’s
conclusions on Carugati’s condition were unclear. Dr. Kazda's medical report suggested Carugati
never suffered from CFS or fibromyalgia.
Dr. Kazda's only support for that conclusion is a one-line comment there
"is no clear substantiation in the record of either chronic fatigue
syndrome or fibromyalgia." Dr.
Kazda arrived at this conclusion without conducting any physical examinations
or medical tests on Carugati. Dr.
Kazda's report failed to discuss the record evidence that formed the basis for
that conclusion. The court determined
that Dr. Kazda and the plan's conclusion was inconsistent with its continuous
payment of disability benefits to Carugati for nine years. Dr. Kazda's opinion of Carugati's condition
in October 2000 was based on medical reports that are over five years old. Further, the plan made its determination on
the opinion of one non-treating, non-examining physician, who was the plan's
associate medical director.
Dr. Papernik, Carugati's
treating physician, diagnosed her with chronic fatigue syndrome and
fibromyalgia from 1991 to 2000. The
court noted that Dr. Kazda summarily dismissed Dr. Papernik's diagnosis by
stating his examination showed no significant abnormalities and was based on Carugati's
subjective statements. The plan and Dr.
Kazda failed to evaluate Carugati's ability to engage in employment, which
constituted the plan's definition of disability. Dr. Kazda did not address Dr.
William Hilger's opinion that Carugati experienced a significant decline in
cognitive ability, general knowledge, calculational ability and abstract
reasoning.
The court noted that its plan's
second basis for denying benefits -- the video surveillance tape -- only
demonstrated that Carugati can walk her dog for several minutes during the day
and climb a small step ladder. The video
surveillance did not shed light on Carugati's ability to function at a
full-time job. Under the Hartford plan,
total disability is not equated with a plan participant's inability to walk,
care for oneself, or perform routine daily functions but a participant's
inability to engage in employment. The
court found that Dr. Kazda's conclusion that the video surveillance was in
"marked contrast" with Carugati's statements about her condition was
inaccurate. The court noted that
Carugati's ability to walk her dog several minutes a day and climb a few rungs
of a small stepladder once do not automatically render a conclusion that she
was lying or misrepresenting her condition.
The court noted that the plan relied on Dr. Kazda's speculative
conclusion that "long term secondary gain appears to be a major motivating
factor in this case." Dr. Kazda
formed that conclusion without examining or interviewing Carugati.
The court found as significant
that the plan's determination on Carugati's condition comes after the plan paid
benefits to Carugati for nine years.
From 1991 to 2000, the Hartford plan conducted four evaluations of
Carugati's condition but it continued benefits after each evaluation. At the time the plan terminated benefits, the
record was devoid of new medical evidence indicating a significant change in
Carugati's condition. The plan’s
failures to address Caugati’s receipt of social security disability benefits
for nine years, and continued to receive those benefits at the time the plan
terminated long-term disability benefits also troubled the court.
The plan concluded Carugati was
not disabled based on Dr. Kazda's brief report and an immaterial video
surveillance tape. The plan chose not to conduct an independent medical
examination, and it failed to sufficiently analyze the record evidence. Thus,
the plan failed to make a rational connection between the evidence in the case
and its conclusion to terminate benefits. The plan's termination of Carugati's
benefits was arbitrary and capricious.
Unfortunately for Carugati the
court did not order the plan to reinstate the benefits. Instead it rewarded
Hartford for its Cavalier attitude in the claims process by remanding the claim
to Hartford to do it right. Because this court remanded the matter to the plan
administrator, Carugati was only "a prevailing party in some sense of the
term" and was not entitled to attorney's fees at this point. The court
found that Carugati failed to present evidence the plan's decision was in bad
faith or was taken to harass Carugati by denying her disability benefits.
[1]
Mark D. DeBofsky, Nathan Q Rugg, DeBofsky &
DeBofsky, represented Carugati,. Donald Alan Murday, Elizabeth
Gwynn Doolin, Craig Michael Bargher, Peterson & Ross, represented the
plan The Honorable Suzanne B. Conlon was
the judge.