United States District Court, Western District of New York
February 9, 2001
ROBERT VAN WUYCKHUYSE, PLAINTIFF,
METROPOLITAN LIFE INSURANCE COMPANY AND KODAK ACCIDENTAL DEATH INSURANCE PLAN, DEFENDANTS.
The opinion of the court was delivered by: Siragusa, District Judge.
Decision and Order
The Plaintiff filed a complaint with the Court on June 21,
2000, alleging that the Defendants improperly denied benefits to
him under an accidental dismemberment policy. Both parties agree
that the plan involved here falls under the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA"). This
case is before the Court on the Defendants' motion for summary
judgment and the Plaintiff's cross-motion for summary judgment.
Because the Court finds that the Plan Administrator's decision
was not arbitrary and capricious, the Court denies the
Plaintiff's motion for summary judgment and grants the
Defendants' motion for summary judgment, dismissing the case.
The plan at issue here is the January 1, 1997, Kodak
Accidental Death Insurance Plan ("Plan"). A copy of that plan is
attached to the affirmation of Pamela R. Cromp as Exhibit A.
Under Article nine of the Plan, a beneficiary who loses his
thumb is entitled to dismemberment benefits of twenty-five
percent of the employee's choice of coverage. Since the
Plaintiff chose coverage of $500,000, he would be entitled to
$125,000 if he met the Plan's requirements for loss of thumb.
On November 20, 1997, the Plaintiff was severely injured in a
hunting accident when a shotgun slug or bullet hit his right
thumb. According to his doctor, Jeffrey A. Jones, M.D., the
Plaintiff lost "3/4 of his thumb metacarpal, loss of the bone
attaching the thumb to the rest of the hand (trapezium), as well
as skin and muscle damage and complete transaction of the median
nerve all from a single bullet wound." Letter from Jeffrey A.
Jones, M.D. to Ian Mackler, Esq. (Nov. 23, 1998) at 1 (contained
in Cromp affirmation, Exhibit F).
The Plan defines Loss of Thumb at section 2.17, which states,
in pertinent part: "`Loss of Thumb' means that a Participant's
thumb is severed at or above knuckle joint nearest the hand."
Section 13.4, Governing Law, states that, "[t]his document shall
be construed and governed in accordance with the laws of New
York State, except as such laws are preempted by applicable
Article 11 of the Plan gives the Plan Administrator "the
exclusive right: to interpret the Plan; to determine eligibility
for Coverage; to determine eligibility for Benefits; to construe
any ambiguous provision of the Plan; to correct any default; to
supply any omission; to reconcile any inconsistency; and to
decide any and all questions arising in the administration;
interpretation; and application of the Plan." Plan section
11.1(b). This article further provides:
The Plan Administrator shall have full discretionary
authority in all matters related to the discharge of
his responsibilities and exercise of his authority
under the Plan including, without limitation, his
construction of the terms of the plan and his
determination of eligibility for Coverage and
Benefits. It is the intent of the Plan that the
decisions of the Plan Administrator and his action
with respect to the Plan shall be conclusive and
binding upon all persons having or claiming to have
any right or interest in or under the Plan and that
no such decision or action shall be modified upon
judicial review unless such decision or action is
proven to be arbitrary or capricious.
Plan section 11.1(c).
On or about May 13, 1998, the Plaintiff applied for accidental
dismemberment benefits in the amount of $125,000. The
application was made to the Metropolitan Life Insurance Company.
See Cromp affirmation Exhibit B. Metropolitan was the Claims
Administrator under the Plan. See Plan section 13.1. On
November 11, 1998, Metropolitan denied the Plaintiffs claim
finding that while the Plaintiff had lost, "approximately 75% of
[his] thumb metacarpal (the bone between the thumb and the
hand), [his] thumb was not severed."
Pursuant to section 11.4 of the Plan, the Plaintiff appealed
this decision to the Plan Administrator, the Director,
Compensation, Benefits and Staffing, U.S. & G., Human Resources,
Eastman Kodak Co. See Ian Mackler, Esq. letter to Susan Izzo
(Nov. 18, 1998), Cromp affirmation Exhibit D. On June 16, 1999,
the Plan Administrator, Pamela R. Cromp, affirmed the decision
of the Claims Administrator. See Pamela R. Cromp letter to Ian
Mackler, Esq. (June 16, 1999), Cromp affirmation Exhibit E. Ms.
The facts demonstrate that Mr. Van Wuyckhuyse's
injury did not involve a severing of the thumb at or
above the knuckle joint and, therefore, did not
constitute a "Loss of Thumb" within the meaning of
the plan. Although Dr. Jones noted that Mr. Van
Wuyckhuyse's injury was "similar to" a thumb
severance and replantation, he also acknowledges in
his 11/23/98 correspondence that "the thumb blood
vessels were not severed and the thumb was not
physically entirely separated from Mr. Van
Pamela R. Cromp letter to Ian Mackler, Esq. (June 16, 1999),
Cromp affirmation Exhibit E at 1.
The law on summary judgment is well settled. Summary judgment
may only be granted 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
judgment as a matter of law." Fed.R.Civ.P. 56(c). That is, the
burden is on the moving party to demonstrate that the evidence
creates no genuine issue of material fact. Chipollini v.
Spencer Gifts, Inc., 814 F.2d 893 (3d Cir. 1987) (en banc).
Where the non-moving party will bear the burden of proof at
trial, the party moving for summary judgment may meet its burden
by showing the "evidentiary materials of record, if reduced to
admissible evidence, would be insufficient to carry the
non-movant's burden of proof at trial." Celotex Corp. v.
Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2555, 91 L.Ed.2d
265 (1986). Once the moving party has met its initial
obligation, the opposing
par-ty must produce evidentiary proof in admissible form
sufficient to raise a material question of fact to defeat a
motion for summary judgment, or in the alternative, demonstrate
an acceptable excuse for its failure to meet this requirement.
Duplantis v. Shell Offshore, Inc., 948 F.2d 187 (5th Cir.
1991); Fed.R.Civ.P. 56(f). Once the moving party has met its
burden, mere conclusions or unsubstantiated allegations or
assertions on the part of the opposing party are insufficient to
defeat a motion for summary judgment. Knight v. United States
Fire Ins. Co., 804 F.2d 9 (2d Cir. 1986). The Court, of course,
must examine the facts in the light most favorable to the party
opposing summary judgment, according the non-moving party every
inference which may be drawn from the facts presented.
International Raw Materials, Ltd. v. Stauffer Chemical Co.,
898 F.2d 946 (3d Cir. 1990). However, the party opposing summary
judgment "may not create an issue of fact by submitting an
affidavit in opposition to a summary judgment motion that, by
omission or addition, contradicts the affiant's previous
deposition testimony." Hayes v. New York City, Department of
Corrections, 84 F.3d 614, 619 (2d Cir. 1996).
Both counsel agree that Ms. Cromp's actions must be
interpreted under the standard set forth by ERISA. As the Second
Circuit observed in Sullivan v. LTV Aerospace and Defense Co.,
82 F.3d 1251, 1254, "[a]ny discussion of the appropriate
standard of review of a trustee's interpretation of an ERISA
benefit plan begins with the seminal case of Firestone Tire &
Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d
80 (1989)." In Firestone, the Supreme Court held that "[a]
trustee may be given power to construe disputed or doubtful
terms [of a plan], and in such circumstances that trustee's
interpretation will not be disturbed if reasonable." Id. at
111, 109 S.Ct. 948. Where, as here, the Plan's administrator has
been given discretionary authority to interpret the Plan, the
Court must not disturb the administrator's determination unless
it is arbitrary and capricious. See Pagan v. NYNEX Pension
Plan, 52 F.3d 438 (2d Cir. 1995).
The Defendants argue in their memorandum of law (September 19,
2000) that the Plaintiff can prevail only if he can establish
that Ms. Cromp's interpretation of the Plan terms and
application to the record is without any support. The Plaintiff
contends that the Plan Administrator misinterpreted the word
"severed" in contrast with that word's interpretation in a long
line of New York cases. The Defendants counter that the Plan
Administrator's action of interpreting the Plan term "severed"
did not require the resolution of any statutory or common-law
questions that might be excluded from the deferential standard
of judicial review. See Defendants Reply Memorandum of Law in
Further Support of Defendants' Motion for Summary Judgment and
Opposition to Plaintiffs Cross-Motion for Summary Judgment at 2.
The Plaintiff also contends that the Defendants' service of an
affidavit by Roderick Womack (Nov. 13, 2000) raises a "red
herring." Attached to the Womack affidavit, as Exhibit A, is a
copy of the Metropolitan Life Insurance Company Group Insurance
Contract and Certificate of Insurance which Mr. Womack purports
was in effect during 1997. In addition, he has attached to his
affidavit, as Exhibit B, what he claims are relevant pages from
that certificate showing that loss of thumb means, "actual
severance at or above the joint nearest the hand." The Plaintiff
argues that the Certificate of Insurance is not the Plan or
Summary Plan Description, and is counter signed on January 21,
1998, which he argues is evidence that it was not effect in
1997, and that the papers contained in Exhibit B are undated.
Plaintiffs Reply Memorandum of Law in Further Support of
Plaintiffs Motion for Summary Judgment and in Opposition to
Defendants['] Motion for Summary Judgment (Nov. 15, 2000) at
1. As a preliminary matter, the
Court does not consider that the Certificate of Insurance, or
other papers attached to Mr. Womak's affidavit, govern the
Court's decision here. Rather, they are applicable only insofar
as they can be used to determine whether the Plan
Administrator's decision was arbitrary and capricious.
The Plaintiff argues that the Plan Administrator's
determination that the word "severed" means a complete
detachment is an arbitrary and capricious decision; thus, the
Court should reverse that decision and review the case de
novo, correctly applying New York law, which, as previously
mentioned, has interpreted the word "severed" in insurance
contracts to not require the entire loss of the body part to
which the contract referred. See, e.g., Sneck v. Travellers'
Ins. Co. of Hartford Conn., 88 Hun. 94, 68 N.Y.St.Rep. 658,
34 N.Y.S. 545 (N.Y.Sup.Ct. 1895); Mifsud v. Allstate Ins. Co.,
116 Misc.2d 720, 456 N.Y.S.2d 316 (Civ.Ct. 1982). Thus, the
issue before the Court is whether the Plan Administrator's
interpretation of "severed" as requiring the entire separation
of the Plaintiffs thumb was arbitrary and capricious.
The Plaintiff relies on Ninth Circuit case law holdings which
support his position that, for example, state law regarding
interpretation of contracts applies to the Plan Administrator.
See Kunin v. Benefit Trust Life Ins. Co., 910 F.2d 534 (9th
Cir. 1990) (rule of contra proferentem applies to
interpretation of ERISA benefit trust). The Ninth Circuit
reasoned*fn1 that employee benefit contracts, and in that
case, specifically an insurance policy, "are almost always
drafted by specialists employed by the insurer . . . [and] an
insurer's practice of forcing the insured to guess and hope
regarding the scope of coverage requires that any doubts be
resolved in favor of the party who has been placed in such a
predicament." Id. at 540. The Plaintiff reasons that if ERISA
was enacted to protect employees, as is evident in Congress's
statement of purpose for the Act, it only makes sense to require
the Plan Administrator to follow state law interpretation of the
The Defendants, however, point out that in Pagan, the Second
Circuit specifically rejected the application of state law to
Plan Administrators, particularly the rule of contra
proferentem, which is "that when one party is responsible for
the drafting of an instrument, absent evidence indicating the
intention of the parties, any ambiguity will be resolved against
the drafter." Pagan, 52 F.3d 438, 443 (citation omitted). This
holding, they argue, shows the Second Circuit's rejection of the
argument that state law on the interpretation of contract terms
applies at all to the Plan Administrator.
The Court agrees that the Second Circuit holding in Pagan
supports the Defendant's position. A reading of Pagan leads
this Court to conclude that the Plan Administrator has authority
under ERISA to interpret "severed" differently from the manner
it might be interpreted by a New York court, and consequently
the fact that she has done so is not ipso facto, proof of
arbitrariness and capriciousness on her part. Further, based on
the evidentiary submissions, the Court finds, as a matter of
law, that the Plan Administrator's interpretation*fn2 of
"severed" to require actual separation of the thumb from the
remainder of the hand is reasonable under the terms of the Plan.
The Court grants the Defendants' motion for summary judgment
and denies the
Plaintiffs motion for summary judgment, dismissing the case.