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GOLDSTEIN v. GROUP INS. PLAN FOR ADMINISTRATIVE &

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK


December 11, 1995

ARTHUR K. GOLDSTEIN, Plaintiff, against GROUP INSURANCE PLAN FOR ADMINISTRATIVE, AND MANAGEMENT EMPLOYEES OF FAIRCHILD REPUBLIC COMPANY, FARMINGDALE FACILITY; FAIRCHILD INDUSTRIES PENSION & RETIREMENT COMMITTEE, as Plan Fiduciary and as Plan Administrator; JOHN DOE and JANE DOE, as members of the Fairchild Industries Pension & Retirement Committee; and FAIRCHILD INDUSTRIES, INC., Defendant.

The opinion of the court was delivered by: GLEESON

MEMORANDUM AND ORDER

 JOHN GLEESON, United States District Judge:

 Plaintiff Arthur K. Goldstein brought this action under Section 502(e)(1) of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132(e)(1), for damages and declaratory and injunctive relief in connection with the defendants' denial of plaintiff's request for particular health benefits. The following parties are joined as defendants: Fairchild Industries, Inc. ("Fairchild"), plaintiff's former employer; the Group Insurance Plan for Administrative and Management Employees of Fairchild Republic Company ("the Plan"); the Fairchild Industries Pension & Retirement Committee ("the Committee"); and Connecticut General Life Insurance Company ("CIGNA"). The latter two defendants are joined as fiduciaries of the Plan.

 The complaint sets forth five claims. First, it asserts that the Plan breached its obligations to plaintiff by refusing to provide coverage for "cognitive remediation therapy," a type of treatment plaintiff required for memory problems caused by brain dysfunction. Second, it is claimed that in denying plaintiff the requested coverage, Fairchild and the Committee breached their fiduciary obligations to plaintiff in violation of 29 U.S.C. § 1104(a)(1). Third, the Committee is alleged to have failed, in violation of 29 U.S.C. § 1132(c)(1)(B), to timely provide plaintiff with information he requested about coverage available under the Plan, and owes a statutory penalty for this failure. Fourth, plaintiff claims that Fairchild and the Committee interfered with his attainment of benefits in violation of 29 U.S.C. § 1140, by usurping CIGNA's right to decide whether plaintiff's claim was covered and deciding it themselves, and by mischaracterizing the manner in which he ceased to work for Fairchild so as to preclude coverage. The fifth cause of action, which was asserted against CIGNA, has been dismissed, and CIGNA is no longer a party to the case. Plaintiff seeks a declaratory judgment stating that among other things, he is still covered by the Plan even though he ceased to work for Fairchild in 1986, and that the cognitive remediation therapy he seeks is within the Plan's coverage. In addition, plaintiff seeks to have this Court order the defendants to authorize payment for the proposed therapy. He also claims damages for defendants' failure to provide him with the requested Plan information, and for their alleged interference with his attainment of benefits, described in his fourth claim for relief.

 Defendants have moved for summary judgment dismissing all the above-described claims for relief. Plaintiff has cross-moved for summary judgment with respect to the first three claims. He asserts that if his motion is granted he will withdraw the fourth claim.

 BACKGROUND

 Plaintiff was employed by Fairchild from 1979 until he was laid off effective December 12, 1986. He was initially hired as a Financial Analyst, and was promoted to Spares Administrator in 1982 and to Senior Spares Administrator on June 17, 1984, the position he held when his employment was terminated.

 Plaintiff was in a series of automobile accidents throughout his life, each of which impaired him to some degree. One of these occurred on March 23, 1984 while he was employed at Fairchild. After this accident he suffered memory loss and a consequent decline in his work performance. In March 1985, plaintiff was reassigned first to the Spares Administration Bill of Material Section, and then to the Funding Section of Spares Administration. In both cases, his supervisors expressed concern about whether he could perform successfully.

 In 1985, plaintiff applied to CIGNA requesting benefits for cognitive remediation therapy, a course of treatment that he hoped would ameliorate his memory problems. CIGNA acknowledged and processed the claim, but never decided whether to grant it.

 On July 30, 1986, plaintiff was involved in another automobile accident. His memory problems were at this time affecting his work capacity to such an extent that he could no longer perform the responsibilities of his position. On October 8, 1986, Fairchild prepared a special "work plan" for plaintiff to assist and monitor his performance for 90 days. Almost two months later, on November 21, 1986, plaintiff and 42 other employees were laid off effective December 12, 1986. Subsequently, Fairchild closed the facility at which plaintiff had performed his duties.

 In 1987, the Social Security Administration determined that plaintiff was totally and permanently disabled, and found November 30, 1986 to be the date of disability onset. In 1988, Aetna, the insurer of the Plan's life insurance provisions, waived plaintiff's life insurance premium payments on the ground that he had been disabled since November 1, 1986. Finally, in July 1989, CIGNA found plaintiff eligible for long term disability benefits under Fairchild's Long Term Disability Plan which CIGNA administered. For purposes of these benefits CIGNA found that plaintiff's disability had begun on November 22, 1986.

 In 1990, plaintiff applied again to CIGNA for benefits to cover cognitive remediation therapy. CIGNA denied the claim on April 25, 1990, on the ground that the requested benefits were educational in nature and not within the Plan's coverage. Plaintiff appealed the denial, and on July 9, 1991, CIGNA affirmed its prior decision on the additional ground that plaintiff's coverage under the Plan had terminated on February 12, 1987. Subsequently, in a letter dated January 6, 1992, CIGNA informed plaintiff that Fairchild had made the determination that the coverage had ceased, and that all questions and appeals should be directed to Fairchild. Accordingly, plaintiff addressed an appeal to Fairchild on March 18, 1992.

 In a decision issued in May 1992, the Committee denied plaintiff's appeal, relying on several provisions of the Plan which the parties agree control the outcome of the instant litigation. These provisions are contained in the Group Insurance Plan Summary Plan Description/Certificate ("Summary Plan Description" or "SPD"), *fn1" and set forth the circumstances under which insurance terminates. The first section, entitled "Termination of Insurance - Employees", reads as follows:

 

Your insurance will cease on the earliest date below:

 

- the date you cease to be in a Class of Eligible Employees or cease to qualify for the insurance.

 

* * *

 

- the date your Active Service ends except as described below.

 A further provision defines Active Service:

 

You will be considered in Active Service:

 

- on any of your Employer's scheduled work days if you are performing the regular duties of your work on a full time basis on that day either at your Employer's place of business or at some location to which you are required to travel for your Employer's business.

 An additional provision allows for continuation of medical insurance in the event Active Service ends due to disabling injury or sickness.

 

If your Active Service ends due to an Injury or Sickness, your insurance will be continued while you remain totally and continuously disabled as a result of the Injury or Sickness. However, the insurance will not continue past the date your Employer stops paying premium for you or otherwise cancels the insurance.

 Total disability is defined in the following manner:

 

You will be considered Totally Disabled if, because of an Injury or a Sickness:

 

- you are unable to perform the basic duties of your occupation; and

 

- you are not performing any other work or engaging in any other occupation for wage or profit.

 Finally, an extension of medical benefits is provided in certain circumstances.

 

In the case of all other benefits, an expense incurred after a person's benefits cease but within the Time Period shown below for that benefit, will be deemed to be incurred while he is insured if such expense is for an injury or a Sickness which causes him to be Totally Disabled from the day his insurance ceases until that expense is incurred.

  Revelant Time Periods: Major Medical 1 year Any other benefits 3 months

19951211

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