The opinion of the court was delivered by: John T. Curtin United States District Judge
By order of United States District Judge Richard J. Arcara dated July 6, 2011 (Item 60), this matter has been reassigned to the undersigned for all further proceedings.
This case was brought pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001, et seq. ("ERISA"). Plaintiff seeks long term disability benefits under an employee benefit plan offered by her former employer. Her claim was denied based on an exclusion in the plan for disabilities arising out of a pre-existing condition. Plaintiff does not dispute that her disability is the result of a pre-existing condition, but states that the exclusion was waived by her employer. Additionally, plaintiff contends that New York Insurance Law does not allow an insurer to bar coverage based on a pre-existing condition. It is the defendant's position that Rhode Island law applies to this policy and that benefits were properly denied.
Plaintiff commenced this ERISA action with the filing of a complaint on December 8, 2008 (Item 1). In her complaint, she alleged that she was employed by Alcott Staff Leasing, Inc. ("Alcott") and was a participant in the Alcott Group Long Term Disability Plan issued by defendant Genworth Life and Health Insurance Company ("Genworth") (Item 1, ¶ 4).*fn1 Plaintiff, a chiropractor, was employed by Alcott as a medical peer reviewer. In December 2005, plaintiff applied for coverage under the group disability policy. Id., ¶ 11. On August 31, 2006, plaintiff ceased working due to disability and applied for long term disability benefits. Defendant denied plaintiff's request for long term disability benefits based on an exclusion in the policy for pre-existing conditions. Id., ¶¶ 12 -13, 15.
Plaintiff was diagnosed with multiple sclerosis ("MS") several years before. In late 2005, she was told by Alcott's representatives that no pre-existing condition exclusion applied to the long term disability plan (Item 1, ¶¶ 22-24). Plaintiff obtained a letter, dated December 23, 2005, from a supervisor in the Alcott corporate office in Farmingdale, New York, confirming that "the benefit plans The Alcott Group offers are not subject to pre-existing conditions." Id., Exh. A.
Defendant Genworth filed its answer to the complaint on January 7, 2009 (Item 2). In a stipulation filed November 23, 2009, the action was dismissed as against Alcott and the Alcott Group Long Term Disability Plan (Item 26). On September 19, 2010, defendant filed a motion for summary judgment (Item 37), and on September 21, 2009, plaintiff cross-moved for the same relief (Item 41). On January 31, 2010, the parties filed memoranda in opposition to the cross motions (Items 48, 50). On February 25, 2010, the parties filed reply memoranda (Items 54, 55). Oral argument was heard before United States Magistrate Judge H. Kenneth Schroeder, Jr. on March 7, 2011. For the reasons that follow, the defendant's motion for summary judgment is granted, and the plaintiff's motion is denied.
In support of its motion for summary judgment, defendant has submitted plaintiff's claim file, including the policy of insurance, appended to the affidavit of Paul Briere, senior benefit analyst for defendant (Item 37, Exh. A).*fn2 The policy was issued by GE Group Life Assurance Company to Alcott Staff Leasing, Inc., on July 1, 1996. The policy holder is the "Trustee of the Manufacturing Industry Group Insurance Fund (Rhode Island)" under a trust agreement dated January 1, 1994. The state of issue is specified as Rhode Island (AR 1). The policy also provides that it is "governed by the laws of the State of Issue shown above, which is the state of issue of the group policy." Id.
According to the group disability plan, a pre-existing condition is defined as a sickness or injury for which the insured "[r]eceived medical care, treatment, or consultation, diagnosis or diagnostic tests" or "[t]ook any drugs, medicine or medication prescribed or recommended by a Physician" during the three months before the effective date of the policy (AR 8). The policy further provides that long term disability benefits will not be paid "[f]or any Period of Disability which is caused by, contributed to by, or results from a Pre-existing Condition . . ." (AR 18). The exclusion does not apply if the disability commences after 12 months of continuous insurance coverage. Id. Under "General Provisions," the policy states that changes can be made in writing upon the agreement of the policy holder and the insurer, and that "[n]o agent may change or waive any of the policy provisions, nor can an agent make any agreement that would be binding on" the insurer (AR 25).
According to plaintiff's application for long term disability benefits dated September 15, 2006, she stopped working due to MS on August 30, 2006 (AR 37). She was first treated for her illness in 1990 and was seen by her treating physician on July 26, 2006 (AR 39). Medical records submitted in support of her application also indicate that she was treated on November 29, 2005 (AR 149).
In a letter dated November 14, 2006, defendant informed plaintiff that her claim for long term benefits was denied (AR 130-31). On May 10, 2007, plaintiff formally appealed that decision, stating that her employer amended the plan and waived the pre-existing condition exclusion (AR 98-100). Upon review of the denial of plaintiff's claim, defendant upheld its decision (AR 89-94). With regard to plaintiff's argument of waiver or amendment of the policy, defendant stated that "Alcott had no authority to make such a statement or exception to their contract. Neither is there any record that they sought or received such a waiver or amendment of the plan language from us" (AR 93).
Michael Sabadosa, an Underwriting Consultant with Sun Life and Health Insurance Company ("Sun Life"), the successor to defendant Genworth, stated in an affidavit that at the time Alcott requested insurance coverage, GE Group Life Assurance Company, Genworth's predecessor, offered 33 separate multiple employer trusts representing different industries (Item 48, ¶ 7). An applicant is placed in a particular trust based on the nature of its business, which is determined by the Standard Industrial Classification ("SIC") code stated by the employer on its application for coverage. Id.,
¶ 8. Based on its choice of SIC code 3612, Alcott was placed in the Manufacturing Industry Group Insurance Fund Trust. Id., ¶¶ 9-10. The 33 different multiple employer trusts offered by defendant are considered "same industry trusts." Id., ¶ 12. Census information on Alcott's 1996 application indicates that its 46 employees held job titles indicative of ...