WEITZENKAMP v. UNUM LIFE INSURANCE COMPANY (September 20, 2011)
Time Warner Cable employed Susie Weitzenkamp as a sales representative. Weitzenkamp participated in the company's employee benefits Plan, which included long-term disability benefits. The disability Plan provided for 24 months of benefits if a participant could not perform the duties of her regular position. Benefits could continue after 24 months if a participant could not perform the duties of any occupation. The Plan excluded benefits after 24 months if the participant's disability was based on self-reported symptoms. The self-reported symptom exclusion was not mentioned in the Plan’s summary plan description, however. After Weitzenkamp came down with a viral illness, she received 24 months of disability benefits. The Plan invoked the self-reported symptoms exclusion and terminated her benefits after 24 months. Weitzenkamp applied for and received Social Security benefits, as well. The Plan requested reimbursement of approximately $9,000 in overpayments as a result of the retroactive Social Security benefits. Weitzenkamp filed suit. The Plan counterclaimed for the overpayments. Judge Griesbach (E.D. Wis.) granted summary judgment to the Plan, approving its reliance on the self-reported symptoms exclusion. The district court also awarded the Plan the overpayments. On appeal, the Seventh Circuit reversed (opinion and intheiropinion) the benefits denial, holding that the Plan's failure to include the exclusion in the summary plan description estopped it from relying on it as a defense. The Court affirmed the recovery of the overpayments. The Court later granted a petition for rehearing and withdrew its opinion.
In their opinion after rehearing, Seventh Circuit Judges Rovner and Hamilton and District Judge Lefkow again reversed in part and affirmed in part, although its reversal rested on different grounds. The Court conceded that its review was under the arbitrary and capricious standard, which gives great deference to the Plan. Here, the district court concluded that the benefits denial was not arbitrary and capricious because of the self-reported symptoms exclusion. The Court looked to the Plan's language to decide whether it applied to all illnesses where symptoms are self-reported (as the Plan contends) or only to illnesses where the diagnosis is based primarily on self-reported symptoms (as Weitzenkamp contends). The Court conceded that a literal interpretation supported the Plan’s view – but it rejected that interpretation. Since most illnesses and diseases manifest themselves through pain or weakness or fatigue (i.e., symptoms are self-reported), they would be included within the exclusion under the Plan's view. That result would not be reasonable and therefore makes the Plan's interpretation arbitrary and capricious. Instead, the Court concluded that the exclusion applies only to illnesses that are diagnosed primarily on the basis of self-reported symptoms. Here, Weitzenkamp's fibromyalgia was diagnosed with the "trigger test," an accepted clinical test for the illness. The self-reported symptoms exclusion therefore does not apply and Weitzenkamp was improperly denied benefits. Because the record supports a disability finding, the Court ordered reinstatement of benefits rather than a remand. With respect to the request for benefits reimbursement, the Court agreed that the Plan could not levy or garnish Weitzenkamp’s Social Security benefits under the statute but that also concluded that the statute does not preclude a claim for reimbursement. The Plan was entitled to reimbursement.