1, 1997. Armstrong began to receive disability benefits in 1994, when a policy with an effective date of January 1, 1992 (the "1992 Policy") was in effect. [Colello McGee Aff., Ex. A]. Liberty terminated plaintiff's benefits in 2001, however, when a policy with an effective date of November 1, 1997 (the "1997 Policy") was in effect. .
Plaintiff's first argument fails, however, because both policies grant Liberty Life Assurance discretionary authority. The 1992 Policy provides: "The Plan Administrator has the authority, in its sole discretion, to construe the terms of his policy and to determine benefit eligibility." [Colello McGee Aff., Ex. A, Section VI.N.]. The 1997 Policy provides: "[Liberty] shall possess the authority, in its sole discretion, to construe the terms of this policy and to determine eligibility hereunder." .
Even if the 1992 Policy did not grant discretionary authority to the plan administrator, the 1997 Policy would preclude applying a de novo standard of review. Courts that have addressed such circumstances — where an individual becomes disabled under a plan, the plan is amended to confer discretionary authority on the plan administrator, and the plan administrator then discontinues the individual's benefits — have found that the amended plan's provisions mandate review under the "arbitrary and capricious" standard. See Smathers v. Multi-Tool, Inc., 298 F.3d 191, 195-96 (3d Cir. 2002); GroszSalomon v. Paul Revere Life Ins. Co., 237 F.3d 1154, 1160-61 (9th Cir. 2001); Neely v. Pension Trust Fund, 2003 WL 21143087, at *5-6 (E.D.N.Y. Jan. 16, 2003).
Second, plaintiff argues that Liberty Mutual, which was both plaintiff's employer and the Plan Administrator, had a conflict of interest that makes deference inappropriate here. "In order to trigger de novo review of an administrator's decision when the plan itself grants discretion to the administrator, a plaintiff must show that `the administrator was in fact influenced by the conflict of interest.'" Pulvers v. First UNUM Life Ins. Co., 210 F.3d 89, 92 (2d Cir. 2000) (quoting Sullivan v. LTV Aerospace & Defense Co., 82 F.3d 1251, 1256 (2d Cir. 1996)) (emphasis in Pulvers). Here, plaintiff simply asserts that Liberty Mutual's conflict is "self-evident" because, as plaintiff's employer, it "clearly had an economic incentive to conclude that Plaintiff was no longer totally disabled within them meaning of the applicable plan." [Plaintiff's Sur-Reply 4-5]. Assuming the existence of such a conflict, defendants' financial stake in the determination of plaintiff's claim does not warrant de novo review absent evidence that this conflict in fact influenced defendants' determination. See Fay v. Oxford Health Plan, 287 F.3d 96, 108-09 (2d Cir. 2002). Plaintiff offers no such evidence; the "arbitrary and capricious" standard of review will apply.
B. Arbitrary and Capricious Review
In reviewing a claims administrator's decision under the arbitrary and capricious standard of review, the court must grant significant deference to the plan administrator's determination. See Schwartz v. Newsweek, Inc., 827 F.2d 879 (2d Cir. 1987). The court, with appropriate deference to the administrator's determination, must review the Administrative Record to determine "the [the defendants'] decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment." Jordan v. Retirement Committee of Rensselaer Polytechnic Institute, 46 F.3d 1264, 1271 (2d Cir. 1995) (quotation marks omitted). The administrator's decision to deny benefits may only be overturned if it was, "without reason, unsupported by substantial evidence or erroneous as a matter of law." Kinstler v. First Reliance Standard Life Ins. Co., 181 F.3d 243, 249 (2d Cir. 1999); see also Jordan, 46 F.3d at 1271; Pagan v. NYNEX Pension Plan, 52 F.3d 438, 442 (2d Cir. 1995) (citing Abnathya v. Hoffmann-La Roche, Inc., 2 F.3d 40, 45 (3d Cir. 1993)); Corvi v. Eastman Kodak Co. Long Term Disability Plan, No. 01 Civ. 365, 2001 WL 484008, at *5 (S.D.N.Y. May 8, 2001); Gaitan v. Pension Trust Fund of Pension Hospitalization and Benefit Plan of Electrical Indus., 99 Civ. 3534, 2000 WL 290307, at *4 (S.D.N.Y. Mar. 20, 2000); Kocaj v. Building Serv. 32B-J Health Fund, 1998 WL 633662 (S.D.N.Y. 1998). "`Substantial evidence' is `such evidence that a reasonable mind might accept as adequate to support the conclusion reached by the [decision maker and] requires more than a scintilla but less than a preponderance.'" Miller v. United Welfare Fund, 72 F.3d 1066, 1072 (2d Cir. 1995); Todd v. Aetna Health Plans, 62 F. Supp.2d 909 (E.D.N.Y. 1999); Glavan v. Building Serv. 32B-J Health Fund, 1997 WL 381789, at *2 (S.D.N.Y. July 10, 1997). Moreover, "[w]here both the plan administrator and a spurned claimant `offer rational, though conflicting, interpretations of plan provisions, the [administrator's] interpretation must be allowed to control.'" Pulvers v. First UNUM Life Ins. Co., 210 F.3d 89, 92-93 (2d Cir. 2000) (quoting O'Shea v. First Manhattan Co. Thrift Plan & Trust, 55 F.3d 109, 112 (2d Cir. 1995)); Kocsis v. Standard Ins. Co., 142 F. Supp.2d 241, 252 (D.Conn. 2001).
1. Alleged Failure to Consider the Applicable Plan
Plaintiff argues that the 1992 Plan, not the 1997 Plan, applies to his claim. He contends that Liberty's application of the 1997 Plan was necessarily arbitrary and capricious.
Whether the 1992 Plan or 1997 Plan governs Armstrong's claim turns on whether the 1992 Plan vested when plaintiff became disabled. The "general rule" is "that an employee welfare benefit plan is not vested and that an employer has the right to terminate or unilaterally amend the plan at any time." Schonholz v. Long Island Jewish Med. Ctr., 87 F.3d 72, 77 (2d Cir. 1996). However, "[n]othing in ERISA . . . forbids or prevents an employer from agreeing to vest employee welfare benefits or from waiving its ability to terminate or amend unilaterally a plan. . . ." Id. at 77. "The questions whether and when benefits vest are matters of contractual interpretation." Feifer v. Prudential Ins. Co. of America, 306 F.3d 1202, 1211 (2d Cir. 2002). And it is an issue for a trier of fact so long as the plaintiff can "point to language capable of reasonably being interpreted as creating a promise on the part of [the employer] to vest [the recipient's] . . . benefits." Schonholz, 87 F.3d at 78.
The 1992 Plan states: "Liberty Reserves the right to amend, alter or terminate this policy at any time." [ColelloMcGee Aff., Ex. A, at 21]. Plaintiff argues, however, that the following language in the 1997 Plan renders the 1992 Plan applicable to his claim: "Benefits payable for claims arising prior to the effective date of the new policy [November 1, 1997] will be paid in accordance with the terms of the replaced policy." .
A trier of fact need not determine whether the 1992 Plan vested when Armstrong first became disabled in 1994, because the two plans define the word "disability" in virtually identical terms. Pursuant to the 1992 Plan, "total disability" or "totally disabled" means that "after 18 months of benefits have been paid, the insured is unable to perform with reasonable continuity all of the material and substantial duties of his own or any other occupations for which he is or becomes reasonably fitted by training, education, experience, age and physical and mental capacity." [Colello McGee Aff., Ex. A, at 7]. The 1997 Plan provides that "disability" or "disabled" means: "After 18 months of benefits have been paid, the Covered Person is unable to perform, with reasonable continuity, all of the material and substantial duties of his own or any other occupation for which he is or becomes reasonably fitted by training, education, experience, age and physical and mental capacity." . There is no material difference between those two statements.
Plaintiff argues that it is irrelevant whether the two plans are identical in all material respects, and Liberty's application of the identical language in the 1997 Plan was inherently arbitrary and capricious. But plaintiff's argument exalts form over substance. Because the two plans' relevant provisions are identical in all material respects, there is no reason to infer that Liberty Mutual Assurance's determination would have differed in any way were it to have applied the 1992 Plan when reviewing plaintiff's claim. Thus, I cannot find that defendants acted arbitrarily and capriciously on this ground.
2. A Review of the Administrative Record
Defendants contend that there were five principle bases for Liberty's determination that plaintiff was no longer disabled: (1) the surveillance videotapes; (2) Dr. Weinstein's independent medical examination; (3) the Functional Capacities Evaluation; (4) the Vocational Review; and (5) Dr. Brown's two opinions (both documented in memoranda).
a. The Surveillance Videos
Defendants hired Claims Verification Incorporated to conduct surveillance on plaintiff. . Claims Verification produced videotapes of plaintiff's activities and put together written reports documenting the surveillance. Plaintiff remained in his home and out of view much of the time Claims Verification monitored his activities. However, plaintiff was observed at times acting inconsistently with his claimed disabilities. On February 26, 2000, for example, plaintiff was observed driving approximately twenty minutes to a country club. He was seen picking up a gym bag, putting it on his shoulder, bending, and moving his arms and neck. He stayed there approximately an hour and a half before driving home. [000568-000569; Tape 3].
b. Dr. Weinstein's Independent Medical Examination
Dr. Weinstein examined Armstrong on January 24, 2000. In addition to physically examining plaintiff, Dr. Weinstein reviewed a number of records. Dr. Weinstein's report indicates that he reviewed the following: "Request for service, note from Dr. Kaplan on 1/26/99, notes from Dr. Radna between 1994 and 1996, medication/prescription list between 1992 and 1998, physical therapy orders and notes from NYU in 1999, surveillance/investigative report dated 7/14/99, attending physician's statement, labor market survey, physical capacity evaluation from 1996, neurological consultation on 1/9/95, note from Dr. Fischman on 10/18/94, EMG performed on 12/22/94, job physical demand work sheet, job description, multiple Xrays/MRI reports between 1994 and 1999." .
Dr. Weinstein found that "the patient is physically limited by his history of cervical and lumbar disc herniations and subsequent surgeries." . He determined that plaintiff should not frequently bend, climb, or kneel; plaintiff should not sit for longer than an hour at a time without the ability to change positions after an hour; and plaintiff's driving on the job should be limited. Dr. Weinstein believed that these physical limitations were permanent.
Dr. Weinstein opined, however, that "the patient's restrictions placed on his activities by attending physician is somewhat excessive." He concluded:
The objective evidence does support some restrictions
in sitting and standing. However, I believe that the
patient is not restricted to sitting or standing or
walking for only fifteen minutes in an eight hour
day. He should be able to read and write with
modifications as needed. He should be able to drive
up to an hour at a time with the ability to pull over
and stretch his legs if necessary.
According to Dr. Weinsten, plaintiff was capable of spending 50% of an eight hour day sitting, 5% lifting, 50% walking, 50% standing, 5% carrying, 25% driving, 25% traveling, and 25% typing. .
c. The Functional Capacity Evaluation
Daniel Fishman conducted the Functional Capacities Evaluation of plaintiff on September 14 and 15, 2000. Fishman reported that plaintiff "demonstrated poor quality of movement throughout the Functional Capacity Evaluation." . And as plaintiff's "significant deficits," he listed: "Crouch and kneeling positions, lifting floor-to-waist and overhead lifting. Overhead work."
Fishman opined, however, that plaintiff "tends to restrict himself unnecessarily due to pain" and "limited himself due to pain frequently throughout the Functional Capacity Evaluation." . As Armstrong's "significant abilities," he listed: "Horizontal lifting (from the two surfaces of equal waist height). Most positional work tasks, such as repetitive squats, sitting and standing tolerance, rotational sit and stand activities, balance and upper extremity coordination." Fishman concluded that plaintiff met the "medium" physical demand level set by the National Institute of Occupational Safety and Health. .
In a September 19, 2000 addendum, Fishman wrote: "Client limited himself throughout the Functional Capacity Evaluation frequently saying `that's enough', `how's your medical malpractice' and `nope' to express his refusal to progress exam limit determinations. This client restricted himself due to pain unnecessarily because, I feel, he has not motivation not to. See motivation comments." . Fishman's "motivation comments" state:
Client reports that his is perfectly happy to stay at
home, collect disability and watch his children play
in sporting events. For this reason, I do not believe
that he is a work hardening candidate. Furthermore,
he reports that he has had extensive physical therapy
to maximize his functional ability. This client is
being rewarded for staying home and staying
injured/disabled. From a psychological perspective on
the Magill Pain Questionnaire, the client indicated
14 of 20 pain categories. This indicates that the
chronicity of his condition has psychologically
d. The Vocational Review
In developing a Vocational Review, Mary Paine O'Malley reviewed Dr. Weinstein's Independent Medical Evaluation and Fishman's Functional Capacity Evaluation. . She also spoke with Dr. Weinstein and Fishman, as well as with plaintiff. The Vocational Review, dated October 13, 2000, concluded:
Based on the FCE [Functional Capacity Evaluation]
results and my conversation with Mr. Armstrong, Mr.
Armstrong does not present as motivated to return
to work in any capacity. He appears to have acquired
computer related skills including website design;
however, he was unrealistic in what situation he
could potentially return to work. Based on the FCE
results, it does not appear that he could fully
perform his own occupation without some
modifications. He has not maintained his licenses;
therefore, he would not currently qualify for the
position with other employers. He could potentially
perform alternative positions such as Claims
Representative, Customer Services Representative,
Inside Sales Representative, etc.; however, wages
would more than likely act as an obstacle to his
qualifying for higher level insurance related
positions such as Risk and Insurance Manger [sic],
Department Manager, Office Manager and Training