# BOGGS v. BLUE CROSS BLUE SHIELD OF NORTH CAROLINA

> District Court, M.D. North Carolina · August 19, 2024

URL: https://www.frixlaw.com/law-library/cases/10653816

## Case

- **Court:** District Court, M.D. North Carolina
- **Decided:** August 19, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

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- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10653816

## How later opinions describe it (automated extraction)

- noting that a non-moving patty may not test upon mete allegations or denials.
- finding “public notice” requirement met where motion to seal had been publicly docketed for one month

## Opinion text

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF NORTH CAROLINA

CARL A. B., et al., )
Plaintiffs,
v. Case No. 1:22CV84
BLUE CROSS BLUE SHIELD OF
NORTH CAROLINA, et al., )
Defendants.
)

MEMORANDUM OPINION AND RECOMMENDATION
OF UNITED STATES MAGISTRATE JUDGE
This matter is before the Court on cross-Motions for Summary Judgment filed by
Plaintiffs [Doc. #96] and Defendants [Doc. #102]. In this action, Plaintiffs seek payment of
claims for L.B.’s treatment at Open Sky Wilderness (“Open Sky”), a residential treatment
facility in Durango, Colorado from July 14 through September 27, 2017, pursuant to the
Employee Retitement Income Security Act of 1974 (hereinafter “ERISA”), 29 U.S.C. §§ 1001-
1461.
For the reasons set out below, the Court recommends that Plaintiffs’ Motion for
Summary Judgment be denied, Defendants’ Motion for Summary Judgment be granted, and
this matter be dismissed with prejudice.
I. ALLEGATIONS IN COMPLAINT AND PROCEDURAL HISTORY
The following facts are taken from Plaintiffs’ Second Amended Complaint
(“Complaint” or “Compl”) [Doc. #52], the operative Complaint. Plaintiffs allege that

Plaintiff Carl A. B. (“Carl”), is covered by the Blue Cross Blue Shield of North Carolina
(hereinafter “Blue Cross NC”) Blue Options PPO (hereinafter “the Plan’) provided through
his employer, that Carl’s daughter L.B. is a beneficiary of his health insurance plan, and that
the Plan is an employee benefit plan governed by ERISA. (Compl. {ff 1-4.) Plaintiffs seek
payment of claims for L.B.’s treatment at Open Sky.
As background, Plaintiffs allege that beginning in ninth grade, L.B. developed a purging
habit and eating disorder, began experimenting with substances, including alcohol and
marijuana, and drank heavily. (Compl. 8.) Plaintiffs allege that L.B. was enrolled and
admitted to Timberline Knolls Residential Treatment Center for approximately one month
and was subsequently enrolled in an outpatient facility, and that she had discontinued binging
and purging, but resumed at some point during outpatient treatment, and her alcohol use
increased again. (Compl. J 9.) Plaintiffs allege that L.B. had several physical altercations with
het mother and her sister throughout her sophomore year of high school, her alcohol use
continued to increase, she was diagnosed with ADHD, and she began taking ADHD
medications. (Compl. J] 10-11.) Plaintiffs allege that between 2015 and 2017, L.B. became
intoxicated to the point where she had to be hospitalized on multiple occasions. (Compl. {
12.) Plaintiffs allege that L.B. threatened suicide multiple times and was hospitalized for
threatening suicide and for excessive intoxication. (Compl. ff] 12-13.) Plaintiffs allege that in
May 2017, L.B. became extremely intoxicated and began damaging their home, that Carl
attempted to restrain her to prevent further damage and ultimately decided she was too out of
control and called the police, and that while a Sheriffs Deputy was attempting to talk to L.B.,
she “stormed up the stairs and threw a vase down the staits, shattering it,” resulting in a shard

from the vase injuring the Sheriffs Deputy. L.B. was immediately arrested for felony assault

on a law enforcement officer and placed in jail. (Compl. § 16.) Plaintiffs allege that Carl
“realized [L.B.] was at a critical, emergent stage and needed help,” and he bailed her out of jail,
and contacted a consultant to assist in finding a treatment program. (Compl. § 17.) Plaintiffs
allege that L.B. was enrolled in Open Sky Wilderness Therapy two months later, in July 2017,
and attended the program for two months until September 2017, and then continued
outpatient therapy at Hopeway Center. (Compl. 18.)
With respect to the pre-litigation appeal process, Plaintiffs allege that the family
submitted claims to BlueCross for L.B.’s residential treatment at Open Sky, and received notice
of denied coverage of her treatment through a series of Explanations of Benefits dated July 3,
2018, July 4, 2018, and August 14, 2018, stating that the claims were denied because the service

was “provided without authorization.” (Compl. ff 21-22.) Plaintiffs allege that Carl submitted

a level-one member appeal to the Plan on December 13, 2018, arguing that the Plan offered
retrospective reviews in cases of emergency, requesting a tetrospective review of L.B.’s
treatment, and arguing that Open Sky was a covered service under the Plan because the
Exclusions section of the Summary Plan Description contained no information that would
lead Carl to believe that Open Sky was an excluded service and because Open Sky met the
Plan’s definition of a provider. (Compl. {| 23-24.) Plaintiffs allege that on December 20,
2018, the Plan sent Carl a letter stating that the request should be handled by Magellan
Healthcare and forwarded the request for review to Magellan Healthcare, and Plaintiffs allege
that Magellan Healthcare did not respond to the first appeal until March 5, 2019, more than
30 days after the appeal was filed. (Compl. {[f] 26-27.) Plaintiffs allege that on March 26, 2019,

Carl wrote a complaint to the North Carolina Department of Insurance due to the Plan’s
delayed response to the level one-member appeal, and on April 10, 2019, the Plan wrote a
letter to the North Carolina Department of Insurance stating that Magellan Healthcare’s
records indicate that a decision was made on January 14, 2019, but Magellan Healthcare was
unable to produce a copy of the letter, and the Plan attached a duplicate copy which was
generated on March 5, 2019, which Plaintiffs allege was the first response that they had
teceived from Magellan Healthcare. (Compl. {J 35-36.) Plaintiffs allege that Magellan
Healthcare upheld the denial based on the 2019 Magellan Cate Guidelines for Residential
Behavioral Health Level of Care, claiming that L.B.’s “symptoms do not appear to require a
[]twenty-four (24) hour per day, seven (7) day per week treatment facility to help you learn
how to take cate of your daily living needs for one ot more of the following reasons: You are
reported to be able to cate for your physical needs. You are not reported to be at risk [flor
being dangerous to yourself or others. Where you live does provide the help you need to get
better. Your current symptoms would be safely treated at a less restrictive level of care.”
(Compl. §{] 27-28.) Plaintiffs allege that Carl submitted a second-level member appeal on
August 22, 2019, and argued that L.B.’s treatment at Open Sky met the Plan’s definition of
medically necessary. (Compl. 37-39.)
Plaintiffs originally filed this action in the District of Utah, and the case was
subsequently transferred to this Court. Plaintiffs were given leave to amend the Complaint,
and ultimately filed the Second Amended Complaint, now the operative Complaint in this
matter, taising a single cause of action for recovery of benefits under the terms of the Plan
pursuant to 29 U.S.C. § 1132(a)(1)(B).

Defendants moved for dismissal [Doc. #53], which was denied [Doc. #77, #87]. The
Parties then filed cross-Motions for Summary Judgment [Doc. #96, #102]. The Parties have
filed the Administrative Record in this case [Doc. #94-1, #94-2] and the matter is ripe for the
Court’s consideration.
IL. STANDARD OF REVIEW
A. Motion for Summary Judgment
Summaty judgement is appropriate when no genuine dispute of material fact exists and
the moving patty is entitled to judgment as a matter of law. Fed. R. Cty. P. 56(c). A genuine
issue of material fact exists if the evidence presented could lead a reasonable fact-finder to
return a verdict in favor of the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 255 (1986). A court considering a motion for summary judgment must view all facts and
draw all reasonable inferences from the evidence before it in a light most favorable to the non-
moving patty. Id. The proponent of summary judgment “beats the initial burden of pointing
to the absence of a genuine issue of material fact.” Temkin v. Frederick Cnty. Comm’rs, 945
F.2d 716, 718 (4th Cir. 1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)). If the
movant catries this burden, then the burden “shifts to the non-moving patty to come forward
with facts sufficient to create a triable issue of fact.” Id. at 718-19 (citing Anderson, 477 U.S.
at 247-48). A mete scintilla of evidence supporting the non-moving party’s case 1s insufficient
to defeat a motion for summary judgment. See, e.g., Shaw v. Stroud, 13 F.3d 791, 798 (4th
Cir. 1994); see also Anderson, 477 U.S. at 248 (noting that a non-moving patty may not test
upon mete allegations or denials.) Thus, “plaintiffs need to present more than their own

unsupported speculation and conclusory allegations to survive” a motion for summary
judgment. Robinson v. Priority Auto. Huntersville, Inc., 70 F.4th 776, 780 (4th Cir. 2023).
B. Recovery of Benefits under 29 U.S.C. § 1132(a)(1)(B)
Plaintiffs seek to recover benefits due under the terms of the Plan pursuant to 29 U.S.C.
§ 1132(a)(1)(B). Specifically, Plaintiffs seek judgment in the amount of L.B.’s past due
treatment claim from Open Sky from July 14, 2017, through September 27, 2017, pre- and
post-judgment interest, and attorney’s fees. (Compl. {| 43-46.)
Section § 1132(a)(1)(B) allows “a participant or beneficiary .. . to recover benefits due
to him under the terms of his plan, to enforce his rights under the terms of the plan, or to
clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. § 1132(a)(1)(B).
ERISA “permits a person denied benefits under an employee benefit plan to challenge that
denial in federal court.” Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 108 (2008) (citing 29
U.S.C. § 1001 et seq.; 29 U.S.C. § 1132(a)(1)(B)). In Glenn, the Supreme Court noted that
ERISA imposes higher-than-marketplace quality standards on insurers. It sets
forth a special standard of care upon a plan administrator, namely, that the
administrator discharge its duties in respect to discretionary claims processing
solely in the interests of the participants and beneficiaries of the plan; it
simultaneously underscores the particular importance of accurate claims
ptocessing by insisting that administrators provide a full and fair review of
claim denials; and it supplements marketplace and regulatory controls with
judicial review of individual claim denials.
Id. at 115 (citing 29 U.S.C. §§ 1104(a)(1), 1132(a)(1)(B)) (Gnternal brackets, citations, and
quotations omitted).
The Fourth Circuit has set out basic guidelines for “Judicial review of ERISA plan
determinations.” Champion v. Black & Decker (U.S.) Inc., 550 F.3d 353, 358 (4th Cir. 2008).

Farst ... a reviewing court must be guided by principles of trust law, taking a
plan administrator’s determination as “a fiduciary act (Z¢., an act in which the
administrator owes a special duty of loyalty to the plan beneficiaries).” Second,
coutts must “review a denial of plan benefits under a de novo standard unless the
plan provides to the contrary.” Third, when the plan grants the administrator
“discretionary authority to determine eligibility for benefits, a deferential
standard of review is appropriate.” And fourth, “if a benefit plan gives discretion
to an administrator or fiduciary who is operating under a conflict of interest,
that conflict must be weighed as a factor in determining whether there is an
abuse of discretion.”
Id. (quoting Glenn, 554 U.S. at 111) (internal citations, ellipsis, and brackets omitted). In
conducting judicial review in an ERISA case, the Court ordinarily considers the record that

was before the Plan Administrator. See Sheppard & Enoch Pratt Hosp., Inc. v. Travelers Ins.
Co., 32 F.3d 120, 125 (4th Cir. 1994). The Fourth Circuit has identified relevant factors to
consider in reviewing a plan administrator’s decision for reasonableness, including the
language of the plan; the purposes and goals of the plan; the adequacy of the materials
considered to make the decision and the degree to which they support it; whether the
fiduciary’s interpretation was consistent with other provisions in the plan and with earlier
interpretations of the plan; whether the decision-making process was reasoned and principled;
whether the decision was consistent with the procedural and substantive requirements of
ERISA; any external standard relevant to the exercise of discretion; and the fiduciary’s motive
and any conflict of interest it may have Booth v. Wal-Mart Stores, Inc. Assocs. Health &
Welfare Plan, 201 F.3d 335, 342-43 (4th Cir. 2000).
In this case, the Plan grants the administrator discretionary authority to determine
eligibility for benefits. ‘Therefore, the Parties agree that a deferential standard of review is
approptiate, and the Court reviews whether Defendants’ actions were an abuse of discretion,
based on a review of the undisputed Administrative Record. (Defs.’s Resp. [Doc. #116] at 7-

8; Pls.’s Am. Br. [Doc. #124] at 10-11; Tr. at 66 (“[Blue Cross NC] has the authority to use its
discretion to make reasonable determinations in the administration of coverage.”)).! See
Sheppard & Enoch Pratt, 32 F.3d at 125.
Ill. THE RECORD REGARDING CLAIMS BENEFITS
The Parties are largely in agreement with what factually transpired in this case and with
the applicable terms of the Plan. It is in the interpretation of and application of those terms
to the facts of this case that the Parties disagree.
A. The Terms of the Plan
Plaintiff Carl A. B. participated in an employer-sponsored health benefit plan
administered by Defendant Blue NC, for which his daughter, Plaintiff L.B., was also a
beneficiary. (Tt. at 1, 144-45, 163, 173, 1425.) The Plan covered “Mental Health And
Substance Abuse Services,” and specifically stated that “[t]his health benefit plan provides
benefits for the treatment of mental illness and substance abuse by a hospital, doctor or other
provider.” (Tt. at 42) (capitalization omitted). Coverage for such setvices was “coordinated
through Magellan Behavioral Health.” (Tr. at 42.)
The Plan’s covetage of mental health and substance abuse services included “inpatient
treatment, and RESIDENTIAL TREATMENT FACILITY services,” but the Plan specified
that “PRIOR REVIEW must be requested and CERTIFICATION must be obtained in
advance” for these setvices, except that prior authorization was not required “in
EMERGENCY situations.” (Tr. at 42.) For emergencies, the Plan required covered

Cations tothe Transp ret to pages of the unsealed, unredacted Administrative Record [Doc. #94-1,
94-2].

individuals to “please notify Magellan Behavioral Health of your inpatient admission as soon

as teasonably possible.” (Ir. at 42.) The Plan stated that “[flailure to request PRIOR
REVIEW and receive CERTIFICATION will result in a full denial of benefits.” (Tr. at 42.)
The Plan also provided for “tetrospective/post-service reviews” in, among other
things, situations where review was necessary “to see if services received in an EMERGENCY
setting qualify as an EMERGENCY,” and the Plan provided that retrospective review “will
be based on MEDICAL NECESSITY and whether the service received was a benefit under
this health benefit plan.” (Tr. at 57-58.) The Plan defined “MEDICALLY NECESSARY (or
MEDICAL NECESSITY)” as follows:
Those COVERED SERVICES ot supplies that are:
a) Provided for the diagnosis, treatment, cure, or telief of a health condition,
illness, injury, or disease; and, except for clinical trials as described under
this health benefit plan, not fot EXPERIMENTAL,
INVESTIGATIONAL, or COSMETIC putposes,
b) Necessary for and appropriate to the diagnosis, treatment, cure, or relief of
a health condition, illness, injury, disease, or its symptoms,
c) Within generally accepted standards of medical cate in the community, and
d) Not solely for the convenience of the insured, the insured’s family, or the
PROVIDER.
For medically necessary services, BCBSNC may compate the cost-effectiveness
of alternative services, settings or supplies when determining which of the
setvices ot supplies will be covered and in what setting medically necessary
setvices ate eligible for coverage.
(Tr. at 79.) The Plan provided Blue Cross NC with “the authority to use its discretion to make
reasonable determinations in the administration of coverage,’ which included “decisions
concerning eligibility for benefits, coverage of services, cate, treatment, or supplies, and
reasonableness of charges.” (Tr. at 66.)

B. ‘The Precipitating Incident and Resulting Treatment at Open Sky
Prior to the treatment in this case, L.B. had a history of mental-health and substance-
abuse concerns. (T't. at 1129-32.) Such issues included incidents of serious intoxication, an
eating disorder, and threats of suicide. (Tr. at 1129-32.) At some unspecified time, L.B. “was
hospitalized at the Psychiatric Unit of Carolinas Medical Center.” (Tr. at 1130.)
In one incident in May 2017, L.B. “became extremely intoxicated,” Carl called 911, a
Sheriffs Deputy arrived, and L.B. threw a vase down the staits, which shattered, causing a
piece of the vase to “cut the Deputy’s head severely.” (Tr. at 1130.) As a result, L.B. was
atrested for “Felony Assault on a Law Enforcement Officer.” (Tr. at 1130.)
About a month after this incident, in June of 2017, Carl contacted a Therapeutic and
Educational Consultant to find programs for L.B. (Tr. at 791, 1130-31.) This led to L.B.’s
admission to Open Sky’s residential behavioral health program a month later on July 14, 2017.
(Tr. at 1130-32, 1349-50.) Neither Carl nor L.B. sought pre-authorization from Defendants
for this residential mental health treatment.
The records from Open Sky do not document L.B.’s condition at admission, but a
treatment plan four days later reflects diagnoses of “Generalized Anxiety Disorder,” “Alcohol
Use Disorder, Mild,” “Other Specified Eating Disorder, Bulimia nervosa of low frequency,”
and “Attention-Deficit/Hyperactivity Disorder, Combined Presentation.” (Tr. at 757; see also
Tr. at 147, 150, 153, 156, 159, 1322-25, 1349-50, 1379-80, 1400-03.) L.B. underwent a
psychological assessment on August 30, 2017, six weeks after her arrival, and that assessment
reflects that with respect to her “Presenting Problem”, L.B. “indicate[d that] she was enrolled
at Open Sky due to significant issues with anger, threatening suicide, and legal issues,” while

10

her mother reported enrolling L.B. in the program “due to issues related to intense anger,
difficulty controlling her emotions, and an eating disorder.” (Tr. at 1331.) In addition to
setting goals to address these conditions, L.B.’s treatment at Open Sky consisted of:
weekly individual and group therapy sessions with a mastet’s or Ph.D. level
therapist; daily one-on-one sessions with field guides; daily process groups with
peers and field guides; therapeutic and wilderness skills assignments outlined in
the Student Pathway workbook; daily mindfulness activities such as journaling,
yoga, and meditation; cooking and eating organic, whole foods; peer mentoring
activities; solo expetiences; transition ceremonies to mark movement through
etowth stages; treatment of substance abuse, chemical dependency, ot other
addictive behavioral patterns when indicated via Open Sky’s Integral Recovery
Twelve Steps Workbook.
(Tr. at 1322.) L.B. left Open Sky after just over two months, on September 27, 2017. (Tr. at
1130-32, 1321-28.)
C. The Claims Process and Appeals
Following L.B.’s September 2017 discharge, Carl sent clatms forms to Blue Cross NC
for reimbursement on October 20, 2017, seeking $42,940 in total costs resulting from L.B.’s
treatment at Open Sky. (Tr. at 143-62.) On November 2, 2017 and January 8, 2018, Blue
Cross NC sent requests to Carl for additional information (Tr. at 163-77), but he never
tesponded.3 In June 2018, Open Sky submitted claims directly to the Colorado Blue Cross
and Blue Shield licensee, which processed the claims and ultimately transmitted the claims to
Blue Cross NC. On July 3, July 4, and August 14, 2018, Blue Cross NC sent Plaintiffs

3 The Plan provides that for retrospective review, decisions would be made within 30 days, but “[i]f more
information is needed, before the end of the initial 30-day period, BCBSNC will let you know of the information
needed. You will then have 90 days to provide the requested information. As soon as BCBSNC gets the
requested information, or at the end of the 90 days, whichever is earlier, BCBS will make a decision within 15
days.” (Tt. at 57-58.)
11

explanation of benefits (hereinafter, “EOB”) letters, denying coverage of L.B.’s stay at Open
Sky because the services were provided without prior authorization. (Tr. at 672-91.)
In December 2018, Plaintiffs sought retrospective review of Blue Cross NC’s EOB
denial letters, arguing that L.B. had suffered an emergency under the Plan that excused
Plaintiffs from first seeking prior authorization. (Tr. at 692-700.) Plaintiffs’ request included,
among other things, copies of L.B.’s treatment records from Open Sky and supporting letters
from therapist Robert Adelman, M.S.W., and Therapeutic and Educational Consultant Ashley
Barbour. (T't. at 727-92.) Blue Cross NC in turn forwarded the request and supporting
documents to Magellan. (Tr. at 801.) Upon review, Magellan determined, via a March 5, 2019,
determination letter, that L.B.’s residential treatment was not medically necessary, and
therefore not “appropriate for payment purposes.” (Tr. at 925-27.) In particular, Magellan
found:
Your symptoms do not appeat to requite a 24-twenty four (24) hour per day,
seven (7) day pet week treatment facility to help you learn how to take care of
yout daily living needs for one or more of the following reasons: You ate
reported to be able to cate for you physical needs. You ate not reported to be
at tisk of being dangerous to yourself or others. Where you live does provide
the help you need to get better. Your current symptoms would be safely treated
at a less restrictive level of care.
Therefore, Magellan is unable to authorize Residential Mental Health Treatment
July 14, 201[7] through October 31, 2017.
(Tr. at 926.)
Plaintiffs appealed this determination in August 2019. (Tr. at 1120-46.) Plaintiffs
contended that L.B.’s treatment at Open Sky was medically necessary (Tr. at 1122-46), and
included as exhibits medical records that they had previously submitted in their request for
retrospective review (compare Tr. at 727-84, and Tr. 787-92, with Tr. at 1313-76). As part of
12

their appeal Plaintiffs also requested Magellan’s Care Guidelines and “all documents under
which [the] plan is operated.” (Tr. at 1125, 1145-46.)
Magellan denied Plaintiffs’ appeal on September 9, 2019, again finding that the
treatment was “not medically necessary.” (Tr. at 1425-28.) ‘The contractual basis for the denial

was that this treatment was not a coveted benefit because it was not medically necessary. (Tt.
at 1427.) The clinical basis for the denial was that, at the time of admission, L.B. was “not at
tisk of harm to [herself] or others,” was “not engaging in self-harm behaviors,” “did not have
active substance abuse concerns,” was “not having active symptoms of an eating disorder at
the time of admission,” and was “medically stable and able to care for [her] needs.” (Tr. at
1427)
Following this denial, Plaintiffs brought suit on September 9, 2020 [Doc. #2].
IV. DISCUSSION
In opposition to Defendant’s Motion for Summary Judgment, and in support of their

own Motion for Summary Judgment, Plaintiffs argue that Blue Cross NC abused its discretion
in denying the benefits claim. Under the applicable standard of review, a determination is not

an abuse of discretion if it is reasonable, that is, the result of a deliberate, principled reasoning
ptocess and supported by substantial evidence. Brogan v. Holland, 105 F.3d 158, 161 (4th
Cir. 1997). “Substantial evidence is the quantum and quality of relevant evidence that is more
than a scintilla but less than a preponderance and that a reasoning mind would accept as
sufficient to suppott a particular conclusion.” Donnell v. Metro. Life Ins. Co., 165 F. App’x
288, 295 (4th Cir. 2006) (internal quotation omitted).

13

In alleging abuse of discretion, Plaintiffs focus on four of the relevant factors identified
by the Fourth Circuit in Booth, 201 F.3d 342, grouping two of the factors together.
Specifically, Plaintiffs contend that Defendants (1) failed to comply with the procedural
requirements of ERISA, (2) failed to engage with and adequately consider the record evidence
and failed to follow a reasoned and principled process, and (3) failed to properly apply the
Plan’s terms. (Pls.’s Am. Br. at 9, 10-23.) The Court considers each of these contentions in
turn.
A. Violations of ERISA’s Procedural Standards
Plaintiffs first allege that Defendants violated ERISA’s procedural standards by failing
to respond to Plaintiffs’ claims filing and appeals in the timeframe mandated by the ERISA
regulations (Pls.’s Am. Br. at 12-13), by failing to cite specific plan language as required by the
regulations (Pls.’s Am. Br. at 13), by failing to identify the healthcare professional who assisted
Defendants in making their claim determinations (Pls.’s Am. Br. at 14, 16), and by failing to
ptovide documents which Plaintiffs requested from Defendants during the claims process, but

never teceived (Pls.’s Am. Br. at 14-17, 21-22).
The Fourth Circuit has made clear that it “will not find an abuse of discretion based

on ERISA procedural violations [under § 2560.503-1] absent a causal connection between
procedural defects and the final denial of a claim.” Donnell, 165 F. App’x at 297 (internal
brackets and quotation omitted). In Donnell, the plaintiff argued, as Plaintiffs do here, that
the defendant’s “initial termination letter violated 29 C.F.R. § 2560.503-1 by failing to outline
the evidence necessaty to perfect her appeal or to inform her of her right to review the
administrative record” and that the defendant further violated Section 2560.503-1 by making

14

an untimely decision. Donnell, 165 F. App’x at 296. However, because the plaintiff failed to
show a link between the noncompliance with Section 2560.503-1 and the denial of her claim,
the procedural violation did not change the determination that the plan administrator did not
abuse its discretion. Donnell, 165 F. App’x at 296-97.
In other words, at least in the Fourt Circuit, “noncomphance with § 2560.503-1 is not

an abuse of discretion and does not requite de novo review absent proof that the plan
patticipant was prejudiced.” Benzing v. USAA Officer Severance Plan, No. 3:22-cv-146-
MOC-SCR, 2023 WL 6307079, at *9 (W.D.N.C. Sept. 27, 2023). Therefore, “[a]bsent an
allegation or evidence that Plaintiff has been harmed,” and where “the record contains no
evidence that Plaintiff has been prejudiced by these procedural violations and Plaintiff does
not allege prejudice or harm as a result of the procedural deficiencies,” a court should find that
such technical violations “do not constitute an abuse of discretion.” Potter v. Shoney’s, Inc.,
108 F. Supp. 2d 489, 495 (M.D.N.C. 1999).4

+ Plaintiff correctly quotes Thompson v. Life Insurance Co. of North America, 30 F. App’x 160, 163 (4th Cir.
2002), for the proposition that “procedural safeguards are at the foundation of ERISA.” (Pls.’s Am. Br. at 11.)
Thompson, however, involved an attempt by the insurance company to deny coverage based on a new reason
raised for the first time on judicial review. The Court concluded that “allowing LINA to raise a new basis for
denial would deprive Mr. Thompson of the procedural fairness guaranteed to clatmants under ERISA. Quite
simply, Mr. Thompson and every other claimant is statutorily entitled to expect that plan administrators will
follow mandatory rules of procedure. LINA had a fiduciary duty to consider Mr. Thompson’s claim fully and
fairly and to provide him with the specific disqualifying reason or reasons. A district court’s review is limited
to whether the rationale set forth in the initial denial notice is reasonable. A court may not consider a new
reason for claim denial offered for the first time on judicial review.” Thompson, 30 F. App’x at 163-64 (internal
citation omitted). In the same way, in the present case, the Court is not considering new rationales not relied
upon to deny the claims during the administrative process, but Plaintiffs have not alleged any prejudice with
regard to the other alleged procedural violations. Plaintiffs do contend that they would have submitted
additional evidence regarding L.B.’s condition if they had received more specific reasons for the denials.
However, the denials were sufficiently specific to allow Plaintiffs to know what information to submit, and
indeed Plaintiffs did submit all of the records from Open Sky and letters from L.B.’s therapist and educational
consultant. Even in this proceeding, Plaintiffs still have not presented additional evidence to show prejudice,
and there are no facts that would establish that Plaintiffs were denied full and fair review or that Plaintiffs could
not formulate a meaningful appeal as a result of the alleged procedural violations. Further, the Court also notes
that even if there were prejudice, the remedy would not be an award of benefits, but would instead be a
15

As in Potter, Plaintiffs do not even argue, let alone show based on the record, that
thete was any causal connection between any delay or other procedural violation in this case
and the final determination, nor that Plaintiffs were prejudiced in any way by this delay or any
other purported procedural deficiencies. Thus, all of Plaintiffs’ related arguments that mere
tegulatory deficiencies alone establish an abuse of discretion and/or require reversal (Pls.’s
Am. Br. at 11-13, 16), should be rejected.
As an example, Plaintiffs allege that Blue Cross NC’s retrospective review “denial did
not cite any Plan language,” (Pls.’s Am. Br. at 13), and that when it did reference Plan language
in other parts of the review process it cited “a section of the plan titled, “Covered benefits,
Determination of medical necessity’ that does not exist” (Pls.’s Am. Br. at 14) (citing Tr. at
1427). However, Plaintiffs do not argue, let alone show, how these failures to directly cite
Plan language prejudiced Plaintiffs or affected the outcome of the decision. Moreover, at least
in this case, it is reasonably apparent—given the context of Defendants’ refusal to provide

determination that the claim should be re-evaluated by the administrator with an opportunity for Plaintiffs to
present the evidence they contend could have been presented if they had received more specific reasons for
the denial, but the plan administrator could then conduct a new review, including with respect to whether there
was an emergency and whether other terms of the Plan precluded an award of benefits.
Plaintiffs also cite Mondry v. American Family Mutual Insurance Co., 557 F.3d 781, 798 (7th Cir. 2009), for
the proposition that failure to provide internal guidelines as required by ERISA may be a basis for judgment in
their favor. (Pls.’s Am. Br. at 15.) However, Mondry did not involve a dental of benefits reviewed for abuse
of discretion, and instead involved a claim for statutory fines under 29 U.S.C. § 1132(c)(1)(B) for failing to
provide documents as required under 29 U.S.C. § 1024(b)(4). Plaintiff does not bring such a claim in this case.
Instead, the only claim at issue in this case is the claim for benefits due under the terms of the Plan under 29
US.C. § 1132(a)(1)(B), with review of the denial of benefits for abuse of discretion.
Plaintiffs also cite Wilson v. UnitedHealthcare Insurance Co., 27 F.4th 228, 247 (4th Cir. 2022) for the
proposition that it is an abuse of discretion to fail to provide requested documents. (P1’s Am. Br. at 16.)
However, Wilson was a case where the defendant’s failure to provide documents had prevented plaintiff from
perfecting an appeal, and this failure thereby excused the plaintiff from having to exhaust her remedies prior to
bringing suit. The court did not find that merely failing to provide the documents was itself an abuse of
discretion.
16

benefits on retrospective review because it deemed that treatment was not medically necessary
(Tr. at 925-27, 1425-28)—that this citation referred to the portion of the plan dealing with
retrospective review of inpatient services and Residential Treatment Facility services obtained
without preauthorization, stating that “[ajll decisions will be based on MEDICAL
NECESSITY and whether the service received was a benefit under this health benefit plan,”
and the corresponding definition of MEDICAL NECESSITY, which included a provision
that Blue Cross NC may compate alternative services and settings to determine “in what
setting medically necessary services ate eligible for coverage.” (Tr. at 42, 57-58, 79.)
Finally, Plaintiffs argue that summary judgment in their favor is appropriate because
Defendants represented to Plaintiffs that their decision was based on the medical opinion of
Dr. LaShondta Washington, when in fact Dr. Diana Antonacci, “not Dr. Washington,
performed the medical review.” (Pls.’s Am. Br. at 14.) To the extent Plaintiffs argue that this

was procedurally incorrect, they do not point to any causation ot prejudice arising from this
putported error and, for the same reasons noted above, this argument should be rejected. See
Benzing, 2023 WL 6307079, at *9; Potter, 108 F. Supp. 2d at 495. In any event, the fact that
a sepatate doctor reviewed the record first (Tr. at 1418-24), and Dr. Washington did a
subsequent teview (Ir. at 1426) and concurred in the finding of the first doctor, does not

mean that Dr. Washington was not the physician who performed the medical review. Thus,
Defendants’ statement that Dr. Washington made this determination, even if based in part on
the preliminary opinion of a fellow physician, is neither false nor a material misteptesentation.°

5 Plaintiffs initially areued that there potentially was no board-certified doctor known as “Dr. Washington” in
the state. (See Pls.’s Br. [Doc. #99] at 14.) Plaintiffs subsequently retracted that argument [Doc. #110]. (See
Pls.’s Am. Br. at 14.)
17

For these teasons, Plaintiffs’ areuments that Defendants violated ERISA’s procedural
strictures in such a way to establish abuse of discretion should be rejected.
B. Adequacy of Materials Considered and Reasoned Decisionmaking Process
Plaintiffs argue that Defendants abused their discretion by “fail[ing] to cite — much less
meaningfully engage with — the record” in their decision denying benefits and that none of
Defendants’ reasons for denial were supported by the record. (Pl.’s Am. Br. at 17-19.) The
Court disagtees.
In its initial EOB letters in 2018, Blue Cross NC explained that coverage was denied
because the setvices had been provided without authorization. (I'r. at 672-74, 678-81, 686-
87.) Under the terms of the Plan, this alone would have been a sufficient reason for dental of
covetage for the type of residential treatment sought in this case. However, Plaintiffs sought
retrospective teview of this determination on the basis of an emergency situation. (Tr. at 694.)
Thus, the subsequent decisions and appeals were conducted in the context of determining
whether an emergency occutted warranting an exception to the Plan’s acknowledged
tequitement for preauthorization for the type of care L.B. recetved.
Magellan initially denied coverage on retrospective review because the treatment was
not medically necessary:
Magellan Healthcare, Inc. (Magellan) has been authorized by Blue Cross Blue
Shield of North Carolina (BCBS NC) to administer its behavioral health
benefits. As such, we ate responsible for reviewing mental health and/or
substance abuse treatment to ensure that it is medically necessary and
appropriate for payment purposes.
BCBS NC tequites that the covered service or treatment is medically necessary.
Please review your benefit plan description for more information and details
about your benefits.

18

We recently conducted a review for Residential Mental Health Treatment for
the above-named member with the provider and/or facility.
Our Physician Advisor, a Board Certified Psychiatrist licensed in North
Carolina, determined that Residential Mental Health Treatment is not medically
necessaty based on the 2019 Magellan Cate Guidelines, Residential Behavioral
Health Level of Care, Adult and Geriatric for the following reason(s):
You ptesented with Generalized Anxiety Disorder, Bulimia Nervosa, Attention
Deficit Hyperactivity Disorder, Substance Use Disorder. Magellan Care
Guidelines, MCG Care Guidelines, for Residential Behavioral Health Level of
Care, Adult and Geriatric treatment have not been met. Your symptoms do not
appeat to requite a 24-twenty four (24) hour per day, seven (7) day per week
treatment facility to help you learn how to take cate of your daily living needs
for one ot more of the following reasons: You are reported to be able to care
for yout physical needs. You ate not reported to be at risk of being dangerous
to yourself or others. Where you live does provide the help you need to get
better. Your current symptoms would be safely treated at a less restrictive level
of care.
Therefore, Magellan is unable to authorize Residential Mental Health Treatment
July 14, 201[7] through October 31, 2017.
(Tr. at 925-26.) The record reflects that in reaching this decision, Plaintiffs medical records
and appeal request were reviewed by at least two medical professionals, who explained their
teasoning and analysis. First, the records were reviewed by Licensed Professional Counselor
M. Bender, who set out L.B.’s clinical summary at length, noting L.B.’s anxiety, history of
binging and purging after nights of drinking, history of anger issues, history of threatening
suicide, legal issues earlier in 2017, use of alcohol one time per week or one time evety two
weeks, past use of alcohol resulting in ER visit, and outpatient treatment weekly or every other
week prior to admission. (Tr. at 804.) LPC Bender concluded that L.B. did not clearly need
residential treatment, and therefore sent the file for further review by a physician. Dr. Candice
Tate then conducted an extended review of the records. Dr. Tate noted that the records from
Open Sky were not structured to determine what the presenting issues were. (Ir. at 805.) Dr.
19

Tate noted that “there is no admission note” and “psychological testing was not started until
8/30/17 and psychiatric assessment started on 9/18/17 per the discharge summary.” (T'r. at
805.) In this regard, as noted above, the records do not show any treatment plan until several
days after admission, and do not reflect any psychological assessment until August 30, 2017,
six weeks after her arrival. (T't. at 757-58, 738-39.) Dr. Tate also noted the reference in the
psychological testing to L.B.’s history of threatening suicide, including at the time of the
incident with the officer, but there were no records indicating that she was threatening suicide
at the time of admission. Dr. Tate also noted that her bulimia was described as “low
frequency.” (T'r. at 805.) Based on this review, Dr. Tate concluded that there was no suicidal
ot homicidal ideation at the time of admission, that L.B. was able to perform het activities of
daily living and care for herself, that the appropriate level of cate was intensive outpatient cate
rather than residential treatment, and that services at the level of a residential treatment center
more intensive than medically necessary. (It. at 805-807.)
Plaintiffs appealed this decision in a detailed letter that again included all of L.B.’s
records from Open Sky. (Tr. at 1122-46.) In its ultimate denial, dated September 9, 2019,
Magellan reviewed, among other things, L.B.’s “Medical records from Open Sky Wilderness
Therapy for dates of setvice from July 14, 2017 through September 24, 2017,” and again
denied coverage, stating:
This denial decision was based upon the covered benefits/determination of
medical necessity described in your certificate of coverage. Please reference
yout cettificate of coverage under the section Covered benefits, Determination
of medical necessity for a full explanation of the coverage available.

20

You ptesented with diagnoses including an anxiety disorder, an eating disorder,
a substance use disorder, and ADHD. At the time of admission, you were not
at tisk of harm to yourself or others. You were not engaging in self-harm
behaviors. You did not have active substance abuse concerns at the time of
admission. You wete not having active symptoms of an eating disorder at the
time of admission. You were medically stable and able to care for your needs
at the time of admission. Magellan Care Guidelines, MCG Cate Guidelines for
Residential Behavioral Health Level of Care, Child or Adolescent treatment
have not been met. Your symptoms do not appear to requite a 24-hour per
day, 7 day per week treatment facility to help you learn how to take care of your
daily living needs for one or more of the following reasons:
° You ate able to cate for your physical needs.
* You ate not at tisk of being dangerous to yourself or others.
¢ Where you live does provide the help you need to get better.
* Your cuttent symptoms would be safely treated at a less restrictive
level of care.
(Tr. at 1427.) The record reflects that this determination was a result of review by two
additional physicians. First, Magellan sent the medical records, correspondence, and appeal
documents to an outside psychiatrist, Dt. Diana Antonacci, who summarized the records and
set out her analysis at length. (It. at 1421-23.) Dr. Antonacci concluded that at the time of
admission, based on the Open Sky records, L.B. had no active suicidal ideation with intention

ot a plan, no homicidal ideation, no psychotic symptoms, and could care for her basic needs,
with no self-injurious behavior. (Id.) Dr. Antonacci further noted that there was a history of
abusing alcohol but no active substance abuse concerns. (Id.) Dr. Antonacci noted that the
recotds reflected a past history of 20 days of residential treatment for eating disorder
symptoms, but no evidence that L.B. was at a dangerous weight or actively engaged in
compensatory eating disordered behavior. (Id.) Dr. Antonacci also noted that L.B.’s family
was open and engaged in treatment, and that L.B. expressed motivation for treatment and

tecovety. (Id.) Based on her review, Dr. Antonacci concluded that medical necessity
guidelines for admission to mental health residential level of cate were not met because there
21

was no evidence L.B. could not receive sufficient treatment and access to services outside of

a residential setting, and Dr. Antonacci identified mental health intensive outpatient treatment

as an alternative. (Tr. at 1422-23.) The evaluation was then reviewed by yet another physician,
Dr. LaShondra Washington, a Senior Medical Director at Magellan. (Tr. at 1418.) Dr.
Washington reviewed the documentation and concluded that she was in agreement with the
third-party reviewer, Dr. Antonacci. Dr. Washington then wrote the analysis and conclusions
that were set out in the denial letter, explaining that L.B.’s symptoms did not appear to requite
a 24-hour per day, 7 day pet week treatment facility, because she could care for her physical
needs, was not at tisk of being a danger to herself or others, had a place to live that could
provide the help she needed to get better, and could be safely treated at a less restrictive level
of cate. (Ir. at 1418.)
These determinations by four different medical professionals find substantial support
in the record, and reflect a reasoned and principled decision-making process. The evidence
submitted by Plaintiffs does not reflect that this determination was unreasonable or an abuse
of discretion. For instance, Plaintiffs point to a letter from one of L.B.’s previous therapists,
Rob Adelman, M.S.W. However, in the letter, Mr. Adelman mentioned prior, non-dated and
non-specific substance-abuse issues that led to treatment for L.B. in the past, but did not even
cursorily state that L.B. suffered an emergency requiting treatment at Open Sky, nor did he
opine that residential treatment was medically necessaty or that L.B.’s symptoms could not
safely be treated in an intensive outpatient program. (Tr. at 788-89.) Mr. Adelman in fact
called L.B.’s continuing problems with “alcohol abuse, eating difficulties, mood lability,
chronic anxiety, impaited family and peer relations and incteasing safety concerns” as being

22

merely “episodic.” (Tr. at 789.) Further, Dr. Antonacci and Dr. Washington considered this
letter, as well as the letter from Plaintiffs’ educational consultant, in reaching theit conclusions.
In the circumstances, Defendants acted reasonably in determining that L.B.’s “episodic”
history of problems was not sufficient to show that treatment at Open Sky was medically
necessaty.°
Nor did that fact that L.B. reportedly binged and purged while at Open Sky contradict
Defendants’ finding that, at the time of her admission, she was not at tisk of harming herself

ot exhibiting active signs of substance abuse. A fait reading of Blue Cross NC’s decision was
that, while noting that L.B. had been diagnosed with an eating disorder and had a history of
substance abuse, she was not actively exhibiting these symptoms at the time of entry into Open
Sky, at least at a level that required 24-hour residential treatment. As noted above, Dr.
Antonacci specifically noted that there was no evidence that she was at a dangerous weight,
no evidence she was actively engaged in compensatory eating-disordered behavior at the time
of admission, and no evidence of bio-medical instability. (Tr. at 1422-23.) Dr. Antonaccti also
noted her history of treatment for eating-disordered symptoms, but no documentation of
hospitalization or of attempting intensive outpatient treatment, and also noted that L.B.’s
family was open and engaged in treatment and that L.B. was motivated to engage in treatment
and recovery. These determinations were reviewed and adopted by Dr. Washington. ‘Taken
together, this is a reasonable explanation for finding that intensive outpatient treatment was
appropriate but residential treatment was not medically necessary. Ultimately, “[s]o long as

6 Indeed, the delay of two months between the precipitating event—L.B.’s arrest for assaulting a member of
law enforcement in May 2017—and her starting treatment on July 14, 2017, supports a finding that the
symptoms did not require residential treatment and could be treated outside of a residential treatment setting.
23

sufficient evidence supports the decision, and the ptocess by which the determination was
made is principled and reasoned,” a court has no basis “to second-guess an administratot’s
denial of benefits.” Wilson, 27 F.4th at 240.
Defendants’ determinations that L.B. could care for her own needs, was not at tisk of
harming herself or others at the time of admission to Open Sky, and could be safely treated at

a less testrictive level of care without the residential program she selected were all reasonable
and supported by the record. Given the detailed review and the analysis by multiple doctors,
the record reflects a reasoned and principled decision-making process and a detailed
engagement with the medical record, and these factors do not show an abuse of discretion.
C. Analysis of the Plan’s Terms
Finally, Plaintiffs argue that Defendants abused their discretion in how they analyzed
and interpreted the Plan’s terms, resulting in what Plaintiffs allege were inconsistent decisions

on what the Plan required. In particular, Plaintiffs fault Defendants’ reliance on the fact that
L.B. did not appear to requite “a 24-hour per day, 7 day per week treatment facility,” and being
“medically stable,” despite nothing in the Plan limiting residential treatment to such acute
needs. (Pls.’s Am. Br. at 21) (quoting Tr. at 42, 81). However, as noted above, the Plan’s
terms tequited prior review and certification for Residential Treatment Facility services, and
whete prior authorization was not obtained, retrospective review could be requested for an

emergency and would be based on Medical Necessity. (Tr. at 57-58.) The definition of
Medical Necessity specifically provided that “BCBSNC may compare the cost-effectiveness
of alternative services, settings or supplies when determining which of the services or supplies
will be covered and in what setting medically necessary services ate eligible for coverage.” (T'.

24

at 79.) As with all care, Defendants had the discretion to deny coverage which it reasonably
determined was not medically necessary. (It. at 66.) In this context, the language used by
Defendants in denying coverage was related to the Plan’s language and, separately, directly
responsive to the arguments taised by Plaintiffs in seeking coverage.’
D. Conclusion as to Abuse of Discretion Determination
The evidence in the record reflects that the denial of benefits was not inconsistent with
the Plan language, and that materials considered included all of the Open Sky medical records
and the letters from L.B.’s therapist and her educational consultant, which were analyzed in
detail by multiple physicians to support the determination, that this reflects a reasoned and
principled decision-making process, that a sufficient explanation of the conclusions was
provided to Plaintiffs in the denial letters such that Plaintiffs were able to meaningfully
respond, that any procedural violations did not prejudice Plaintiffs, and that ultimately
Defendants did not abuse their discretion in denying coverage under either ERISA or the
Plan’s plain terms and thus summaty judgment in Defendants’ favor should be granted.®

7 Plaintiffs also contend that in the final denial letter, Defendants cited to a later version of the Magellan Child
and Adolescent Guidelines rather than the Adult Guidelines. However, the record itself reflects that the 2274
Edition of the Adult Guidelines were used in both levels of review. (Tr. at 1080-1118, 1451-89.) Moreover,
Plaintiffs have not shown how this would have made any difference to the determinations in this case.
8 The Parties disagree over whether Defendant “Blue Options PPO” is the appropriate Plan that may be sued
as a defendant in an ERISA action. (Defs.’s Br. at 23-24; Pls.’s Resp. Br. [Doc. #113] at 23.) As noted tn the
ptior recommendation on Defendants’ Motion to Dismiss [Doc. #77], this Court has previously held that
proper defendants in an action pursuant to 29 U.S.C. § 1132(a)(1)(B) are the “plan itself as an entity and any
fiduciaries who control the administration of the [] plan.” McRae v. Rogosin Converters, Inc., 301 F. Supp. 2d
471, 475 (M.D.N.C. 2004); see also Coleman v. Provident Life & Accident Ins. Co., No. CCB-10-1959, 2011
WL 1980541, at *2 (D. Md. May 20, 2011) (same). In any event, given that the Court recommends that this
matter be dismissed in its entirety, the issue of whether the appropriate Plan was named as a Defendant is
tendered moot because, regardless of the name of the Plan, the claims against Blue Cross NC and the Plan at
issue should be dismissed.
25

V. MOTIONS TO SEAL
Also before the Court ate various joint and un-opposed Motions to Seal, which seek
to seal portions of the Administrative Record and the Parties’ briefs by making narrow
redactions and selective withholdings of L.B.’s private health information and non-party
Hearst Corporation’s proprietary guidelines [Doc. #93, #98, #104, #112, #115, #123, #128,
#131).
The public right of access to judicial records finds its basis in both the common law
and the First Amendment. See Rushford v. New Yorker Mag., Inc., 846 F.2d 249, 253 (4th
Cir. 1988). With respect to the documents and information at issue in the present case, the
Fourth Circuit has “squarely held that the First Amendment right of access attaches to
materials filed in connection with a summary judgment motion.” Doe v. Pub. Citizen, 749
F.3d 246, 267 (4th Cir. 2014) (citing Rushford, 846 F.2d at 252-53). When the First
Amendment is implicated, the court may grant a motion to seal only upon a showing of a
compelling interest, and only if the sealing is narrowly tailored to serve that interest. See Va.
Dep’t of State Police v. Washington Post, 386 F.3d 567, 575 (4th Cir. 2004). “A district court
must... weigh the appropriate competing interests under the following procedure: it must
give the public notice of the request to seal and a reasonable opportunity to challenge the
request; it must consider less drastic alternatives to sealing; and if it decides to seal it must state
the reasons (and specific supporting findings) for its decision and the reasons for rejecting
alternatives to sealing.” Id. at 576; see also Fernandez Gonzalez v. Cuccinelli, 985 F.3d 357,
376 (4th Cir. 2021) (“To seal a document, the district court must (1) give the public adequate
notice of a request to seal and a reasonable opportunity to challenge it, (2) consider less drastic

26

alternatives to sealing, and (3) if it decides to seal, state the reasons, supported by specific
findings, behind its decision and the reasons for rejecting alternatives to sealing.”’).
Here, the Parties’ Motions to Seal have been publicly docketed for several months with

no public objection. Interested non-parties have therefore had a reasonable amount of time
to contest the sealing of the information at issue, although no one has done so. Accordingly,
the notice requirement has been met. See Hunter v. Town of Mocksville, 961 F. Supp. 2d
803, 806 (M.D.N.C. 2013) (finding “public notice” requirement met where motion to seal had
been publicly docketed for one month).
With respect to the medical records and related briefing, the proposed sealed exhibits
contain L.B.’s “confidential sensitive and personal medical information, the protection of
which serves an important governmental interest.” Fulp v. Columbiana Hi Tech, LLC, No.
1:16CV1169, 2018 WL 1027159, at *10 (M.D.N.C. Feb. 21, 2018). In addition, the sealing
that the Parties seek is nartowly tailored to limited redactions and selective withholdings from
the medical records, rather than entirely sealing them all. Balancing the compelling interest to
protect L.B.’s private medical information with the First Amendment right of access, the Court
will grant the request to seal as it is narrowly tailored, and there 1s sufficient public information
to explain the Court’s reasoning. See id. (granting the motion to seal where there was “no less
restrictive way to setve that interest than sealing the entirety of those medical records because
of the breadth of confidential information throughout the records”).?

9 The Court notes that the medical information has been set out in this Recommendation to the extent necessaty
to explain the reasoning and address Plaintiffs’ contentions. Much of this information is generally available in
the publicly-filed Complaint. However, the Court has used initials in this Recommendation to help reduce the
public disclosure and protect L.B.’s privacy interests, following the similar practice used 1n cases involving Social
Security appeals. It is not feasible to redact L.B.’s identifying information from all of the records, so sealing
the requested portions of the records is the natrowest feasible option.
27

The Motions to Seal also request sealing of Magellan’s internal guidelines (Tr. at 1451-
506), at the behest of the Hearst Corporation, from whom Magellan licenses the guidelines.
Magellan subsequently presented further briefing and evidence in support of the sealing [Doc.
#108, #109, #126, #134], reflecting that these documents are commercially sensitive,
confidential business information, and that their public disclosure would cause serious
economic injuty to Magellan. Magellan points to 2023 decision in the District of Utah, Anne
A. v. United Healthcare Insurance Co., No. 2:20-cv-00814, 2023 WL 197301 (D. Utah Jan. 17,
2023), in which the court undertook an extended analysis of a request to seal these same
guidelines. In that case, the court concluded that while the documents could be made available
to Plan members, they were not available to the general public and should be sealed. Given
the analysis in that case, and given that no one has filed any objection to the sealing request or
presented a contrary argument, the Court concludes that Magellan has presented a compelling
interest and has narrowly tailored the request to just its proprietary information, and that
sealing request will likewise be granted.
Finally, the Court notes that Defendants have filed an un-opposed motion [Doc. #120]
seeking permission to manually file a claims spreadsheet attached as an exhibit to another filing
[Doc. #117-1] in a conventional format rather than by filing the same on ECF. Because copies
of the same documents were also sent to Plaintiffs, and because the format they are in make
filing on ECF impractical, the Court will grant that motion.

28

VI. CONCLUSION
IT IS THEREFORE ORDERED that the Patties’ Motions to Seal [Doc. #93, #98,
#104, #112, #115, #123, #128, #131] ate GRANTED.
IT IS FURTHER ORDERED that Defendants’ Motion for Leave to Conventionally
File [Doc. #120] is GRANTED.
IT IS RECOMMENDED that Plaintiffs’ Motion for Summaty Judgment [Doc. #96]
be DENIED, Defendants’ Motion for Summary Judgment [Doc. #102] be GRANTED, and
that this matter be DISMISSED with prejudice.
This, the 19 day of August, 2024.

LO eats
nited States Magistrate Judge

29

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10653816. Public record. Not legal advice.