SPARKES v. MORRISON & FOERSTER LONG-TERM DISABIL. PLAN

The opinion of the court was delivered by: Hurd, U.S. District Judge.

MEMORANDUM-DECISION AND ORDER

I. INTRODUCTION

On August 7, 1998, plaintiff Audrey Sparkes ("Sparkes" or "plaintiff') commenced the instant action, asserting two causes of action pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001, et seq. ("ERISA"), and a third cause of action for wrongful discrimination in violation of California Insurance Code § 10401. Defendants answered the complaint. A motion for partial summary judgment dismissing the third cause of action under the California Insurance Code as preempted by ERISA was granted. Thereafter, plaintiff filed an amended complaint adding a new third cause of action under New York Insurance Law § 4224. Defendants answered the amended complaint. These motions pursuant to Fed.R.Civ.P. 56 followed.

Plaintiff moves for partial summary judgment as to her first and second causes of action, which seek monetary and injunctive relief for the wrongful denial of benefits under Section 502(a)(3) of ERISA, 29 U.S.C. § 1132(a)(3). Defendants have moved for summary judgment dismissing all ERISA and state law causes of action. Oral argument was heard on September 8, 2000, in Utica, New York. Decision was reserved.

II. FACTS

This action arises out of the termination of long-term disability benefits to Sparkes by the defendant Northwestern Mutual Life Insurance Company ("Northwestern"), pursuant to a clause in the defendant Morrison & Foerster Long-Term Disability Plan (the "Plan") which limited receipt of benefits for disability due to mental illness to two years. The following are the undisputed facts in this case.

Sparkes was employed by defendant Morrison & Foerster LLP ("Morrison & Foerster"), a large international law firm, as a word processor and administrative assistant. Sparkes worked in the firm's New York office. During the relevant time period, the firm maintained a group long-term disability insurance plan with Northwestern. The Plan provided long-term disability benefits for eligible employees of the firm, subject to the terms and conditions of the Plan. As an employee of the firm, plaintiff was a participant in the Plan.

Under the terms and conditions of the Plan, an insured employee was entitled to long-term disability benefits, following a 90-day elimination period, if the insured was disabled from her own occupation for a 24-month period. After the 24-month period expired, benefits would be paid only if the employee was disabled from all occupations. All benefits under the Plan were subject to a mental disorder limitation which provided that "[p]ayments of [long-term disability] benefits is limited to 24 months for each period of Disability caused or contributed to by a Mental Disorder. . . . Mental Disorder means: a mental, emotional or behavioral disorder." See Ex. "F" to Siegel Affidavit at 8.

On December 27, 1991, Sparkes became disabled and was unable to work. She was subsequently diagnosed by her own doctors with Chronic Fatigue Syndrome ("CFS"). Following a 90-day elimination period, she began to receive benefits pursuant to the terms of the Plan effective March 28, 1992. On May 18, 1994, Northwestern notified her that it was making an exception to continue her benefits while it investigated the potential applicability of the mental health limitation to her claim.

On or about November 8, 1994, Sparkes was given a psychological examination by Dr. Jacqueline Bashkoff in regard to her application for Social Security disability benefits. Dr. Bashkoff did not attribute plaintiffs CFS symptoms to depression, or to any other mental health or personality disorder. She subsequently began to receive Social Security benefits on or about July 1, 1996.

On February 26, 1996, Northwestern terminated Sparkes' benefits under the Plan on the grounds that it had determined that her disability was attributable to depression, not to CFS, and that she had already received benefits in excess of those payable under the two year mental disorder limitation of the Plan. Sparkes disagreed with this conclusion, and challenged the termination of her benefits pursuant to the internal review procedures of the plan. Following the exhaustion. of these internal remedies, Sparkes commenced the instant action.

III. STANDARD OF REVIEW

A. Summary Judgment

A moving party is entitled to summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The ultimate inquiry is whether a reasonable jury could find for the nonmoving party based on the evidence presented, the legitimate inferences that could be drawn from that evidence in favor of the nonmoving party, and the applicable burden of proof. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In determining a motion for summary judgment, all inferences to be drawn from the facts contained in the exhibits and depositions "must be viewed in the light most favorable to the party opposing the motion." United States v. Diebold; Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962); Hawkins v. Steingut, 829 F.2d 317, 319 (2d Cir. 1987). Nevertheless, "the litigant opposing ...