Lasser v. Reliance Standard

Opinions of the United

2003 Decisions States Court of Appeals

for the Third Circuit

9-18-2003

Lasser v. Reliance Standard

Precedential or Non-Precedential: Precedential

Docket No. 02-4123

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PRECEDENTIAL

Filed September 18, 2003

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 02-4123

STEPHEN P. LASSER

v.

RELIANCE STANDARD LIFE

INSURANCE COMPANY,

Appellant

Appeal from the United States District Court

for the District of New Jersey

(D.C. Civil Action No. 99-cv-04131)

District Judge: Honorable Alfred M. Wolin

Argued April 24, 2003

Before: SCIRICA,* Chief Judge, AMBRO and

GARTH, Circuit Judges

(Opinion filed September 18, 2003)

Joshua Bachrach, Esquire (Argued)

Rawle & Henderson

One South Penn Square

The Widener Building

Philadelphia, PA 19107

Attorney for Appellant

* The Honorable Anthony J. Scirica became Chief Judge on May 4, 2003.

2

Lewis Stein, Esquire (Argued)

Nusbaum, Stein, Goldstein,

Bronstein & Kron, P.A.

20 Commerce Boulevard

Succasunna, NJ 07876

Attorney for Appellee

OPINION OF THE COURT

AMBRO, Circuit Judge:

Reliance Standard Life Insurance Company argues that

the District Court incorrectly held arbitrary and capricious

its determination that Stephen Lasser was not disabled

within the terms of his disability insurance policy. We

conclude that the Court did not err and therefore affirm.

I. Background

Dr. Stephen Lasser is an orthopedic surgeon who was

employed by Townsquare Orthopedic Associates

(“Townsquare”), a four-doctor practice group. He sued to

obtain disability benefits he alleges Reliance Standard Life

Insurance Company (“Reliance”) owes him under the

disability insurance policy Townsquare purchased from

Reliance (the “Policy”). The Policy pays disability benefits

when, because of injury, illness or disease, a claimant “is

capable of performing the material duties of his/her regular

occupation on [only] a part-time basis or [only] some of the

material duties on a full-time basis.”

Dr. Lasser suffers from coronary artery disease. In 1986,

at age 46, he underwent coronary bypass surgery. As later

became apparent, the surgery was not correctly performed.1

1. Rather than performing an artery graft, Lasser’s surgeon conducted a

vein graft procedure. Whereas artery grafts have a relatively high success

rate, vein grafts have a significant failure rate — according to Lasser’s

physicians, between 50% and 60% after ten to fifteen years. Moreover,

Lasser’s vein graft, rather than being connected to another artery (as it

should have been), was sewn to two diagonal branches, only one of

which was supplying blood to the anterior descending artery.

3

Although Dr. Lasser did not experience symptoms for the

next decade following the 1986 surgery, in 1996 he suffered

a myocardial infarction (colloquially, a “heart attack”). Dr.

Robert Aldrich, Lasser’s treating physician, prescribed a

treatment regimen of change of diet, exercise, and drug

therapy. Dr. Aldrich also advised Lasser to reduce his

stress level, including work-related stress. Accordingly, in

September 1996 Dr. Lasser returned to work on a reduced

schedule. He decreased his patient load by 50%, he was no

longer “on-call” at night or on weekends, and he did not

perform emergency surgery. On December 26, 1996,

Reliance approved Dr. Lasser’s application for long-term

disability benefits under the Policy.

However, in December 1997, after a periodic review of Dr.

Lasser’s condition — and primarily in response to a medical

evaluation issued by Dr. William Burke, whom Reliance

hired to evaluate Dr. Lasser — Reliance terminated Lasser’s

benefits on the ground that he was not disabled as defined

by the Policy. Dr. Lasser invoked Reliance’s administrative

appeal procedures, which prompted Reliance to obtain two

additional medical opinions — from Drs. Karel Raska and

John Field — as well as to commission a labor market

survey to determine the material duties of Dr. Lasser’s

general occupation. Based on these medical opinions and

the survey — as well as the fact that Dr. Lasser returned to

work at a full-time schedule (including on-call and

emergency surgery duties) — in April 1999 Reliance

concluded that Dr. Lasser was not disabled from

performing the material duties of his occupation and

affirmed its earlier denial of benefits.

Dr. Lasser then filed a complaint in the District Court. In

a February 8, 2001 opinion, it denied both parties’ cross-

motions for summary judgment and stated that it would

hold a hearing to determine the proper standard of review.2

2. The Court’s stated basis for denying summary judgment was that “a

court could find for either party when considering the administrator’s

resolution of these factual questions under the heightened standard of

arbitrary and capricious review,” and that “the parties have advanced to

the Court some factual support for each of their positions on the

underlying merits of the claim as well as on the extent to which the

4

Lasser v. Reliance Standard Life Ins. Co., 130 F. Supp. 2d

616, 630 (D.N.J. 2001). After holding that hearing and

deciding that a moderately heightened arbitrary and

capricious standard of review was appropriate, the Court

reviewed the record before Reliance. On the basis of its

review, it held Reliance’s determination of nondisability

arbitrary and capricious and that Dr. Lasser was entitled to

benefits. Reliance appeals.

II. Jurisdiction

The insurance policy at issue is covered by the Employee

Retirement Income Security Act of 1974 (“ERISA”), 29

U.S.C. § 1001, et seq. Dr. Lasser sued to recover benefits

under the Policy, and ERISA preempts state-law claims in

this context. Id. § 1132(a). Thus, the District Court had

jurisdiction pursuant to 28 U.S.C. § 1331. We exercise

appellate jurisdiction under 28 U.S.C. § 1291.

III. Standard of Review

The standard-of-review inquiry is more involved in this

case than in most. The Supreme Court has mandated that

courts review under the arbitrary and capricious standard

claim denials in ERISA cases if “the benefit plan gives the

administrator or fiduciary discretionary authority to

determine eligibility for benefits or to construe the terms of

the plan.” Firestone Tire & Rubber Co. v. Bruch, 489 U.S.

101, 115 (1989). “Under the arbitrary and capricious

standard, an administrator’s decision will only be

overturned if it is without reason, unsupported by

substantial evidence or erroneous as a matter of law [and]

the court is not free to substitute its own judgment for that

of the defendants in determining eligibility for plan

benefits.” Pinto v. Reliance Standard Life Ins. Co., 214 F.3d

administrator’s decision was tainted by his self interest.” Id. at 626-27.

Our dissenting colleague suggests that the District Court erred by

considering extra-record evidence in resolving the merits. We disagree.

The District Court recognized that its review was limited to the record

before the claims administrator. Id. at 630.

5

377, 387 (3d Cir. 2000) (internal quotation marks omitted).

Here both parties agree that the Policy grants Reliance such

authority.

However, if the same entity that determines whether a

claimant is disabled must also pay for disability benefits,

that entity has a financial incentive to find him or her not

disabled. Thus, we have noted that, when the insurer of an

ERISA plan also acts as a claims administrator, there is a

structural or inherent conflict of interest that mandates a

“heightened” arbitrary and capricious standard of review.

Id. at 378. In Pinto we employed a “sliding scale” approach

in which the level of scrutiny applied to the fiduciary’s

decision is “a range, not a point.” Id. at 392 (quoting

Wildbur v. Arco Chem. Co., 974 F.2d 631, 638 (5th Cir.

1992)). It is “more penetrating the greater is the suspicion

of partiality, less penetrating the smaller that suspicion is.”

Id. at 392-93.

The District Court held a hearing on the extent of

Reliance’s conflict of interest to determine the standard of

review. Because the Court found no evidence of conflict

other than the inherent structural conflict, it held that the

correct standard of review was “at the mild end of the

heightened arbitrary and capricious scale,” and thus

afforded a “moderate degree of deference” to Reliance’s

determinations. Neither party disputes this conclusion on

appeal. However, Reliance argues that the District Court

misapplied the standard by not deferring to Reliance’s

allegedly reasonable conclusions.3

3. The dissent criticizes the District Court for making de novo findings of

fact on the basis of the Ninth Circuit’s decision in Kearney v. Standard

Ins. Co., 175 F.3d 1084 (9th Cir. 1999), and notes that our Court has

never adopted the Kearney approach. We agree with the dissent that

Kearney is not the law in our Circuit and that de novo factfinding is

improper in reviewing a claims administrator’s decision under the

arbitrary and capricious standard of review. But we do not believe that

the District Court’s reference to, and implicit endorsement of, Kearney

constituted reversible error, for its reference to facts was explicitly

“limited to that evidence before the claims administrator.” 146 F. Supp.

2d at 621.

6

IV. Discussion

A. Dr. Lasser’s Regular Occupation

Under the explicit terms of Dr. Lasser’s Policy, he is

disabled, inter alia, if as a result of injury, illness or disease

he is capable only “of performing the material duties of

his/her regular occupation on a part-time basis or some of

the material duties on a full-time basis.” To determine

whether Reliance correctly decided that Dr. Lasser did not

qualify for disability benefits, we first determine what is his

“regular occupation,” as the Policy leaves this term

undefined. Reliance argues that “regular occupation” is

broad, indeed generic. In initially denying Dr. Lasser

benefits in December 1997, Reliance said that “regular

occupation is not your job with a specific employer, it is not

your job in a particular work environment, nor is it your

speciality in a particular occupational field. In evaluating

your eligibility for benefits, we must evaluate your inability

to perform your own or regular occupation as it is

performed in a typical work setting for any employer in the

general economy.”

We recognize that, if the meaning of “regular occupation”

is ambiguous, Reliance’s definition is entitled to deference

under the applicable arbitrary and capricious standard of

review. Skretvedt v. E.I. DuPont de Nemours & Co., 268 F.3d

167, 177 (3d Cir. 2001) (insurer’s interpretation of an

ambiguous insurance provision is entitled to deference

unless it is contrary to the plan’s plain language). However,

we believe that “regular occupation” is not ambiguous. The

Policy states that it protects the insured from inability to

“perform the material duties of his/her regular occupation.”

Both the purpose of disability insurance and the modifier

“his/her” before “regular occupation” make clear that

“regular occupation” is the usual work that the insured is

actually performing immediately before the onset of

disability. Applying the text as written, Dr. Lasser’s regular

occupation was as an orthopedic surgeon responsible for

emergency surgery and on-call duties in a relatively small

practice group and within a reasonable travel distance from

his home in New Jersey.

Even assuming “regular occupation” is susceptible to

multiple interpretations and therefore ambiguous,

7

Reliance’s definition of the term nonetheless must be

reasonable before deference is conferred. See Skretvedt, 268

F.3d at 177 (noting that courts defer to a claims

administrator’s interpretation if it is not arbitrary or

capricious). Yet Reliance’s definition is different from that in

the caselaw pertaining both to it and disability policies

containing the “regular occupation” modifier. See O’Bryhim

v. Reliance Standard Life Ins. Co., 188 F.3d 502 (Table),

1999 WL 617891 (4th Cir. 1999) (unpublished per curiam)

(on arbitrary and capricious review, holding that claimant

could not perform material duties of his regular occupation

and defining “regular occupation” with reference to specific

duties performed for his employer).

Even were a court not to limit itself exclusively to the

claimant’s extant duties, that person’s “regular occupation”

nonetheless requires “some consideration of the nature of

the institution [at which the claimant] was employed.”

Kinstler v. First Reliance Standard Life Ins. Co., 181 F.3d

243, 253 (2d Cir. 1999). Moreover, Kinstler adopted the

reasoning of an earlier district court case, Dawes v. First

Unum Life Insurance Co., 851 F. Supp. 118, 122 (S.D.N.Y.

1994), which defined “regular occupation” as “a position of

the same general character as the insured’s previous job,

requiring similar skills and training, and involving

comparable duties.” Id. at 122. Notably, Dawes was decided

before Dr. Lasser applied for disability benefits.

The plain meaning of “regular occupation” is one of which

both parties were aware when the Policy began on June 1,

1993. There is no reason to believe that Dr. Lasser was

aware of Reliance’s different definition until it denied him

benefits in December 1997. Because Reliance has shown no

intent to “opt out” of this plainly understood term (indeed,

it had the opportunity to do so each June when the Policy

came up for renewal), it is unreasonable for it to argue it

has done so post hoc. Even if we fall back to the

interpretation of “regular occupation” imparted by Dawes

and Kinstler, it too undermines Reliance’s generic

understanding. Compare also Gaines v. The Amalgamated

Ins. Fund, 753 F.2d 288, 290 n.5. (3d Cir. 1985) (deferring

to a plan administrator’s construction of an ERISA-

governed insurance policy when there was no caselaw

8

interpreting the provision at issue); Epright v. Envtl. Res.

Mgt., Inc. Health & Welfare Plan, 81 F.3d 335, 340 (3d Cir.

1996) (holding a plan construction unreasonable when,

among other deficiencies, the administrator pointed to no

statutory provision to interpret the term and when its

definition seemed self-serving).

In this context, it is unreasonable for Reliance to define

“regular occupation” differently from its plain meaning or

even the somewhat more relaxed understanding of Dawes

and Kinstler without explicitly including that different

definition in the Policy.4

B. Material Duties of Dr. Lasser’s Regular Occupation

Having determined that Dr. Lasser’s regular occupation

under the Policy was that of an orthopedic surgeon in a

four-person practice group in New Jersey, and that it was

unreasonable for Reliance post hoc to argue that the

Policy’s plain language was otherwise, we turn to what Dr.

Lasser did in the course of his regular occupation. He saw

patients during office hours, performed scheduled

surgeries, took night call, and performed emergency

surgeries. When he no longer handled night call and

emergency surgeries, were they material? The District Court

answered yes. 146 F. Supp. 2d at 641.

The Court’s conclusion is supported by comparing Dr.

Lasser’s pre-disability earnings with his post-disability

earnings from a reduced schedule. The Townsquare

shareholders’ agreement requires reduction by one-third of

a doctor’s salary when he or she no longer takes night call.

Moreover, Dr. Lasser’s salary was, on average,

approximately $26,000 per month when he was performing

all duties, but fell to between $4,000 and $6,000 per month

immediately before Reliance terminated benefits. During

this latter period, however, Dr. Lasser was working less

than forty hours per week, as he reduced his patient load

by one-third and no longer was operating in the afternoon

after seeing patients in the morning. Even assuming he was

working twenty hours per week instead of forty (an

4. As noted below, the generic ex post interpretation of Reliance is even

at odds with the majority of survey responses solicited by Reliance.

9

assumption supported by record evidence), and assuming

that he would have made $8,000 to $12,000 per month had

he worked forty hours per week (i.e., double his twenty-

hour-per-week earnings), it stands out that, by not

performing on-call or emergency surgery duties, Dr.

Lasser’s earnings have declined by over 50%. This

substantial earnings decline lays out as little else can the

materiality of those activities to his regular occupation.

Looking at the occupation of an orthopedic surgeon

generically without reference to Dr. Lasser’s particular

duties, Reliance commissioned a labor market survey to

determine whether performing emergency surgery and

being on-call are material duties for an orthopedic surgeon.5

The survey asked:

In general, in your experience is it reasonable that an

Orthopedic Surgeon can practice in this field if one:

[1.] Cannot perform “on-call” duties, do night calls, or

carry a pager[;]

[2.] Cannot perform emergency surgery (even if one

can do non-emergency, elective surgery)[;]

5. Reliance also consulted the Dictionary of Occupational Titles (“DOT”)

to aid its analysis. It points out that the DOT contains no separate

listing for an orthopedic surgeon, which appears as an undefined related

title under the “surgeon” heading. Therefore, applying the definition of

surgeon, which does not refer to on-call and emergency duties, Reliance

argues that these duties are immaterial. We agree with the District Court

that the DOT’s silence about this critical issue makes the DOT unhelpful

and thus, to the extent that Reliance’s conclusion is based on the DOT’s

definition of surgeon, that conclusion is unreasonable.

Ironically, in arguing that Dr. Lasser’s duties should be evaluated with

reference to the surgeon title in the DOT, Reliance acknowledged that

surgery — rather than orthopedics — is the broader “occupational field”

in which Dr. Lasser conducts his “regular occupation.” However, in

relying on the survey to find Dr. Lasser not disabled, Reliance must have

concluded that his “occupational field” is orthopedics rather than

orthopedic surgery — i.e., that his “regular occupation” is one in which

it is reasonable to conduct an office practice only or write reports, which

some of the survey respondents suggested as available options.

Reliance’s inconsistency in position renders its ultimate disability

decision even more suspect.

10

[3.] If you have responded YES to either, can you

estimate in your experience the appx. prevalence of

such jobs for an orthopedic surgeon in the general

economy where one would not need to perform “on-

call” or perform emergency surgery duties?

Reliance’s vendor sent 100 surveys, to which it received

fourteen responses, only nine of which were returned in

time to be considered. Five of those nine respondents

opined that an orthopedic surgeon could “practice in this

field” without performing on-call or emergency surgery

duties. On the basis of the survey, and on the absence of

any affirmative showing from Dr. Lasser that performing

emergency surgery and being on-call are material duties of

an orthopedic surgeon generally, Reliance concluded that

these duties are immaterial, thereby precluding Dr. Lasser

from disability benefits within his Policy’s terms.

While Reliance selected survey responses to argue that

on-call and emergency surgery duties were not material for

Dr. Lasser, we (like the District Court) conclude that

Reliance’s survey actually favors Dr. Lasser’s argument that

these duties are material even on a generic basis.6 When all

fourteen responses are considered and when the

respondents’ comments are viewed along with the answers

to the yes/no questions, the survey indicates that

performing emergency surgery and being on-call are

material duties of an orthopedic surgeon. Eight out of

fourteen responses suggest that practice without these

duties would be impossible or would result in an

occupation fundamentally different from orthopedic

surgery. One respondent wrote that the practice Reliance

proposed would be very unusual and would essentially be

a non-operative practice. Another stated that “[t]he only

jobs that I know of that would fulfill your restrictions would

be someone who restricted themselves [sic] to writing

reports. Work-comp. or med-legal.” A third respondent

6. And given that doctors will inevitably have less scheduling flexibility

when they work in smaller rather than larger practice groups, it seems

only reasonable to conclude that the survey would have been even more

favorable to Lasser had it taken into account the relevant context of his

practice at Townsquare.

11

noted that “[i]n your example, you are describing a

physician who is not an orthopaedic surgeon, but might be

considered an orthopaedist. An orthopaedic surgeon should

be able to fulfill all duties.” Five other respondents flat-out

said that what Reliance proposed was impossible.

In this context, both Dr. Lasser’s particular case and the

survey for orthopedic surgeons in general lead to the

conclusion that on-call and emergency surgery duties were

material to his regular occupation.

C. Ability of Dr. Lasser to Perform the Material Duties

of His Regular Occupation

1. Merits

We next determine whether Dr. Lasser’s medical

condition precludes him from safely performing material

duties of his regular occupation. He argues that he cannot

safely perform emergency surgery or perform on-call duties.

To fulfill our appellate review function under the arbitrary

and capricious standard, we examine the entire record to

determine whether Reliance’s determination is supported by

substantial evidence. Pinto, 214 F.3d at 387.

Reliance’s primary motivation for discontinuing Dr.

Lasser’s benefits in December 1997 appears have been a

report issued by Dr. Burke. He examined Dr. Lasser,

subjected him to a treadmill test in November 1997, and

concluded that Dr. Lasser “does not demonstrate any

cardiovascular disability.”7 During an earlier treadmill test

performed by Dr. Steven Roth in April 1997, Dr. Lasser

“achieved greater than 90% of age-predicted maximum

[heart rate]” and experienced only “mild fatigue [after] 14

minutes.” A nuclear cardiologist, Dr. Christos Christou,

noted that planar imaging of Dr. Lasser’s heart conducted

during the cardiovascular testing revealed only a “very

small and probably clinically insignificant” heart defect.

Furthermore, Reliance notes that Dr. Lasser’s physician,

Dr. Aldrich, considered Lasser to be in New York Heart

7. Dr. Burke described Lasser’s prognosis as “excellent” with a “plaque

stabilizing regimen” and “ace inhibitors to prevent the slight hypertensive

response associated with exercise.”

12

Association Functional Class II (“Patients with cardiac

disease with slight limitation of physical activity. They are

comfortable with mild exertion but experience symptoms

with the more strenuous grades of ordinary activity.”) and

Therapeutic Class C (“Patients with cardiac disease whose

ordinary physical activity should be moderately restricted

and whose more strenuous efforts should be

discontinued.”) — classifications that do not suggest

significant limitations on Dr. Lasser’s ability to work as an

orthopedic surgeon.8

Dr. Lasser, however, contends that Reliance’s conclusion

is unsupported by substantial evidence. He notes that, after

appealing the discontinuation of his benefits, Reliance

engaged two other physicians to evaluate him, both of

whom issued reports supporting his position. The first, Dr.

Raska, concluded that Dr. Lasser “should avoid stressful

situations — i.e., those that require night call [and] medical

emergencies,” and that “[a] reduced stress work

environment and schedule is absolutely necessary to

maintain this patient’s health.” Dr. Raska reasoned that

“[s]tress regardless of exercise tolerance is a recognized

independent risk factor for recurrent coronary artery

disease . . . [and that] there are multiple studies . . . which

demonstrate that stress causes flux in the level of

catecholamines in the circulation which have been shown

to be a precipitant of acute myocardial infarction and

sudden death.” In Dr. Raska’s opinion, Lasser’s

unsuccessful vein graft made stress reduction especially

important, as increased stress could bring about even

earlier failure of the graft. In this context, he opined that

Dr. Lasser’s disability benefits should not have been

8. Reliance also points out that Dr. Burke considered Lasser to be in

Functional Class I (“Patients with cardiac disease but with no limitation

of physical activity. Ordinary activity causes no undue dyspnea, anginal

pain, fatigue or palpitation.”) and Therapeutic Class A (“Patients with

cardiac disease whose physical activity need not be restricted.”). Dr.

Raska said that Lasser was in Functional Class I and Therapeutic Class

C.

13

revoked because he “cannot safely perform the material

duties of an orthopedic surgeon.”9

After receiving this report, however, Reliance realized that

Dr. Raska had a conflict of interest: he practiced in the

same physician group as a doctor from whom Dr. Lasser

previously sought an evaluation, Dr. Lubow (whose

evaluation is discussed below). In response, Reliance

engaged Dr. Field as another evaluating physician. While

Dr. Field noted that “[t]here is little definitive evidence that

emotional or job stress is causally related to the

development or acceleration of coronary artery disease,” he

did acknowledge that “both physical and emotional stress

are identified triggers of acute myocardial infarction [heart

attack].” He concluded that Dr. Lasser could work a forty-

hour week, but “is not capable of resuming all of the

customary duties and responsibilities of an orthopedic

surgeon.” In particular, Dr. Field opined that Lasser should

restrict his on-call or emergency surgery duties, given their

stressful nature.

Dr. Lasser also relies on the evaluation of his treating

cardiologist, Dr. Aldrich, as well those of Drs. Barry Lowell

and Lawrence Lubow, who all opined that he is disabled.

First, Lasser argues that the evaluation issued by Dr.

Aldrich suggests that he is incapable of working in his

regular occupation. When Reliance asked Dr. Aldrich to

complete a form detailing Dr. Lasser’s “current restrictions

and limitations,” he responded that Lasser should “limit

exposure to physical and emotional stress.” He noted also

that “[s]tress is a well-documented risk factor not only for

9. Moreover, Dr. Raska was sharply critical of Dr. Burke’s evaluation, the

basis of Reliance’s initial decision to terminate benefits. While according

to Dr. Burke Lasser underwent a treadmill stress test in which he

exercised to Stage IV of the Bruce Protocol (the standard by which stress

tests are typically conducted), Dr. Raska pointed out that Lasser was

only on the treadmill for three minutes and thirty-six seconds, an

insufficient duration for a patient to reach Stage IV. He also noted that

Dr. Burke’s examination of Lasser’s records was “sloppy” because it

described a heart catheterization occurring in October 1996, when in

fact it was performed in July 1996. To Dr. Raska this error suggested

that Dr. Burke was insufficiently familiar with Lasser’s case to arrive at

a reasoned evaluation of his condition.

14

the development of coronary artery disease itself, but within

that context, to the precipitation of a myocardial

infarction.” As a result, in a letter to Reliance dated June 3,

1998, Dr. Aldrich expressed to Reliance that he believed Dr.

Lasser is disabled and incapable of “resuming all of the

customary duties and responsibilities of an orthopedic

surgeon on a full-time basis[,] or at least that he could not

do so without exposing himself to a high degree of risk.” Dr.

Aldrich’s reasoning underlying this conclusion was that,

even though “by all objective criteria Dr. Lasser is doing

very well at this point in time,” work-related stress might

induce a deterioration in Dr. Lasser’s condition. Moreover,

according to Dr. Aldrich’s reasoning, a favorable

classification under the New York Heart Association

guidelines is of limited use in Dr. Lasser’s situation, as that

classification system addresses a cardiac patient’s ability to

perform certain physical tasks without regard to stress.

Dr. Lowell, who performed a cardiac catheterization on

Dr. Lasser, also opined that Lasser was disabled. He agreed

with Dr. Burke that Lasser’s “functional stress test at the

present time is excellent,” but cautioned that “the stress of

his profession will contribute to poorer control of blood

pressure and lipid therapies” and that “a less stressful

environment would contribute to his graft longevity.” Dr.

Lowell concluded that “the severity of Dr. Lasser’s heart

condition, while not readily measured by traditional testing

methods, renders him just as disabled as the patient whose

disability would not be questioned because he presents

with more overt symptoms.”10

Finally, Dr. Lubow, a physician who examined Dr. Lasser

at the request of Lasser’s counsel, reached a conclusion

similar to that of Drs. Aldrich, Raska, and Lowell. He

opined that, “[b]ased on the recurrence of significant

arteriosclerotic heart disease manifest[ed] by an acute

infarction plus the need for urgent angioplasty and stenting

after a ten year hiatus when he had no symptoms, the

10. He too criticized Dr. Burke’s report for its failure to mention the

“significant anatomic problems with Dr. Lasser’s coronary anatomy.”

15

decision to grant this patient permanent partial disability

was certainly correct, particularly in view of his anatomy.”11

Thus, all evaluating physicians — with the exception of

Dr. Burke, whose report the others discredited — agreed

that Dr. Lasser’s heart condition precludes him from safely

performing on-call duties and emergency surgery.

Reliance’s conclusion to the contrary thus is arbitrary and

capricious. To the extent that Reliance’s determination of

nondisability was that “it was unreasonable . . . to expect

Reliance . . . to simply accept the opinion [that stress would

exacerbate Dr. Lasser’s condition] without any range of the

probability or actual proof that Dr. Lasser was at increased

harm,” we believe its determination was faulty.

2. Clarification Regarding Burden of Proof

We conclude with a clarification regarding the burden of

proof in disability cases. While the burden of proving

disability ultimately lies with Dr. Lasser, to require him to

provide statistics detailing the harm that working in his

regular occupation might precipitate — as the dissent

would require — raises the bar too high.12 Most disability

claimants will not have the means at their disposal

(financial or otherwise) to obtain this kind of evidence.

Therefore, once a claimant makes a prima facie showing of

disability through physicians’ reports (as Dr. Lasser has

done here through physicians’ reports stating that stress

will exacerbate his heart condition) and if the insurer

wishes to call into question the scientific basis of those

reports (as Reliance has attempted to do here), then the

burden will lie with the insurer to support the basis of its

objection. It has not met that burden here.

11. Like Drs. Aldrich, Raska, and Lowell, he also criticized the

thoroughness of Dr. Burke’s review, as well as the improper manner in

which he conducted Lasser’s stress test.

12. The dissent states that the risk that stress will cause future injury

is insufficient to constitute a present disability. However, whether risk of

future effects creates a present disability depends on the probability of

the future risk’s occurrence. While Lasser’s doctors have not precisely

quantified the risk in his case, their reports suggest that the risk is high.

While of course stress does not necessarily incapacitate an individual

(note, for example, Vice President Cheney), in Lasser’s case his doctors

have opined that stress is incapacitating.

16

D. Relevance of Alleged Resumption of Dr. Lasser’s On-

Call and Emergency Surgery Duties

Reliance argues that, even if emergency surgery and on-

call duties are material, Dr. Lasser’s resumption of these

duties settles whether he is disabled from performing them.

We disagree. First, because Dr. Lasser disputes that he has

resumed performing these duties with the same frequency

as before 1996, this issue involves a factual question that

we do not resolve on appeal. Moreover, even assuming the

facts as Reliance has alleged them, Dr. Lasser’s physicians

— as well as Dr. Field, on whose opinion Reliance has

placed much weight — have advised that he should not

perform these duties. Thus, there is substantial medical

evidence that, if Dr. Lasser is performing on-call and

emergency surgery duties, he is doing so to his detriment.

Indeed, Dr. Lasser has argued that, to the extent that he

has resumed these activities, he did so out of economic

necessity — because Reliance discontinued his benefits. A

claimant’s return to work is not dispositive of his or her

disability when economic necessity compels him or her to

return to work. Hawkins v. First Union Corp. Long-Term

Disability Plan, 326 F.3d 914, 918 (7th Cir. 2003) (“A

desperate person might force himself to work despite an

illness that everyone agreed was totally disabling.”);

Levinson v. Reliance Standard Ins. Co., 245 F.3d 1321,

1326 n.6 (11th Cir. 2001) (a claimant’s status as a full-time

employee should not constitute reliable evidence that he is

able to perform the material duties of his occupation on a

full-time basis); Stark v. Weinberger, 497 F.2d 1092 (7th

Cir. 1974) (even if a claimant returns to work, her doing so

does not mean she is not disabled). This principle is

especially persuasive here, where Dr. Lasser’s disability was

not observable and did not make it physically impossible

for him to perform his job for a limited period.

* * * * * * * * *

We hold that Dr. Lasser’s “regular occupation” was that

in which he was actually engaged immediately before

becoming disabled: an orthopedic surgeon in a four-person

practice group in New Jersey. We also hold that on-call and

emergency surgery duties are material to Dr. Lasser’s

practice and that he is disabled from performing those

17

duties. We agree with the District Court that Reliance’s

conclusion to the contrary was unsupported by substantial

evidence and therefore was arbitrary and capricious. We

accordingly affirm the District Court’s judgment in favor of

Dr. Lasser.

18

GARTH, Circuit Judge, dissenting.

I am obliged to dissent from the majority’s judgment in

favor of Dr. Lasser.

(1) The District Court failed to adhere to our established

standards of review and our precedents. See Lasser v.

Reliance Standard Life Ins. Co., 130 F. Supp. 2d 616, 630

(D.N.J. 2001) (“Lasser I”) (“th[is] Court anticipates adopting

the procedure set forth in Kearney [v. Standard Ins. Co.,

175 F.3d 1084 (9th Circuit 1999) (en banc)] and making

plenary findings of fact pursuant to Federal Rule of Civil

Procedure 52, even though no new evidence may be

received on that branch of the case.”)1 By so doing, the

District Court erred by giving only lip service, but no

required true deference, to the Administrator Walsh’s

determinations even after it had held that the Administrator

was neither conflicted nor biased. See Pinto v. Reliance

Standard Life Ins. Co., 214 F.3d 377 (3d Cir. 2000).

(2) This is a summary judgment case. The District

Court, when called upon to decide summary judgment,

cannot hold a trial on the merits a la Kearney. See infra

note 3. In this case, the District Court did just that.

(3) The District Court, at its truncated April 10, 2001

hearing, while purporting to resolve only the

Administrator’s status as to whether he was conflicted or

biased (it held that he was neither), cannot proceed to

ignore our prescribed standard of review which requires

deference and then proceed to substitute its own judgment

on the merits.

(4) The policy written by Reliance requires that for

disability benefits, Dr. Lasser had to be disabled from

performing the material duties of his regular occupation.

The burden of proving materiality rested on Dr. Lasser. No

evidence of materiality appears in the record.

(5) No deference was shown by the District Court to Mr.

1. The District Court filed two opinions in this case. On February 8,

2001, it filed Lasser I, 130 F. Supp. 2d 616, and on June 13, 2001, it

filed Lasser v. Reliance Standard Life Ins. Co., 146 F. Supp. 2d 619

(D.N.J. 2001) (“Lasser II”).

19

Walsh’s, the Administrator’s, determinations that: (a)

materiality was not demonstrated; (b) Dr. Lasser returned

to, and was performing, his full-time occupation; (c)

“emergency” and “on-call” services were not established as

material; yet, these were the only services Dr. Lasser was

told not to perform; and (d) neither stress nor future

disabilities could establish Dr. Lasser’s present disability.

(6) The actions taken by Reliance and the evidence

relied upon by Reliance, as well as the determinations

made by Walsh, the Administrator, cannot be determined to

be arbitrary nor capricious under our standards and

precedents.

I.

This appeal comes to us after both parties had moved for

summary judgment. It has remained a summary judgment

case in which the District Court could look only to the

developed administrative record.

I begin by briefly outlining the pertinent procedural

history. In its February 8, 2001 opinion, the District Court

denied the parties’ cross-motions for summary judgment. It

then stated that it would hold a hearing to determine if

Walsh, the Administrator, was biased or suffered a conflict

because he was an employee of Reliance. Lasser I, 130 F.

Supp. 2d at 625-26, 630 (referring to Pinto’s sliding scale of

arbitrary and capricious review).2

The District Court then conducted a bench trial on April

10, 2001 where it heard only Walsh’s testimony relevant to

the issue of how heightened our standard of review should

be on Pinto’s sliding scale. Dr. Lasser did not testify, nor

did any other witness. I reiterate—the only purpose of the

hearing was to address whether Walsh was conflicted or

biased because he was Reliance’s employee. Walsh had the

duty of determining a claimant’s eligibility for benefits as

well as of paying those benefits out of the funds from which

2. Pinto held that, “when an insurance company both funds and

administers benefits, it is generally acting under a conflict that warrants

a heightened form of the arbitrary and capricious standard of review.”

Pinto, 214 F.3d at 378.

20

Reliance reaps its profits. If biased, then under Pinto the

deference to be accorded his determination would be less

deferential, and the court must “calibrat[e] the intensity of

[the] review to the intensity of the conflict.” Pinto, 214 F.3d

at 393. If not biased, then under Pinto, the standard of

deference to be employed would be “deferential, but not

absolutely deferential.” Id. But, in either event, deference

had to be accorded.

Thereafter, the District Court determined that it would

give a “moderate degree of deference” to Walsh’s

determinations as it found no evidence of bias or conflict

exhibited by Walsh. Lasser II, 146 F. Supp. 2d at 623.

At this stage, the District Court was required to end its

inquiries and hearing and review the existing administrative

record—and no more. But, the District Court did not do

that. It proceeded further, despite the summary judgment

context of the instant case, and it made its own findings of

fact on the merits. Id. at 620, 642.

Under our precedents, district courts cannot conduct so-

called “merits-trials” when determining the appropriate

conflict-of-interest review standard.3 As I have stated, the

District Court should have limited its findings to a

determination of what the appropriate standard of review

would be, and then should have continued on to resolve the

summary judgment question pursuant to that standard.

Accordingly, I would have returned this case to the

District Court with the direction that it expunge all its

merits findings and discussion and then proceed to perform

its prescribed function of ruling, on the administrative

3. The District Court relied on a Ninth Circuit divided en banc case

which, contrary to Third Circuit jurisprudence, required de novo, not

deferential, review. See Kearney, 175 F.3d 1084. In Kearney, a lawyer

with a heart condition who played several sets of tennis every weekend,

car-raced up to 120 miles per hour and had medical opinions that he

could return to work, contested the cessation of his disability policy

payments. Id. at 1086. The District Court accorded de novo review and

ruled in favor of the insurance company. Id. at 1086-87. A fractured en

banc court reversed, approving de novo review but finding a material

disputed fact. Id. at 1090, 1093.

21

record only, whether Walsh’s denial of benefits was

arbitrary or capricious.

II.

Although the District Court purported to subscribe to the

correct standard of review, a fair reading of the District

Court’s opinions indicates that it did not; it merely gave lip-

service to the deference to be accorded to the

Administrator’s determinations.

Pursuant to the plain language of Reliance’s policy,

whether Dr. Lasser is “totally disabled” hinges on whether

he can perform the “material” duties of his occupation. The

relevant part of the policy provides:

“Totally Disabled” and “Total Disability” mean . . . that

as a result of an Injury or Sickness, during the

Elimination Period and thereafter an Insured cannot

perform the material duties of his/her regular

occupation . . . .

App. at 139 (emphasis added). Critical to this analysis, is

that the burden to prove materiality is on Dr. Lasser

because the burden of proving coverage is always on the

claimant. See Lasser II, 146 F. Supp. 2d at 639 (citing

Pinto, 214 F.3d at 394 n.8). Dr. Lasser, however, submitted

no evidence, no proofs, no affidavits, no witnesses, and no

depositions on the issue of materiality. Indeed, the record

as to this issue is barren.4

4. The majority opinion seeks to answer its own question, which it has

posed as, “When he [Dr. Lasser] no longer handled night call and

emergency surgeries, were they material? The District Court answered

yes.” Maj. op. at 8. But, as I have pointed out, it was not the function

of the District Court to make such a finding. Nor is it the function of this

Court to uphold such a finding when it appears in a summary judgment

context.

Rather, the majority should have examined the record, as I have, for

evidence of materiality as to night calls and emergencies. Had the

majority done so, it would have learned, as I did, that no such evidence

exists—and it is that evidence that the Reliance policy requires.

Moreover, the burden of proof as to materiality rests with Dr. Lasser

and the majority opinion’s purported clarification respecting the burden

of proof does not change that prescription. See maj. op. at 15.

22

Despite the silence of the record regarding materiality,

the District Court nevertheless held that Dr. Lasser had

made out his burden of proof on materiality. To do so, the

District Court relied principally on the diminution of Dr.

Lasser’s income when he discontinued emergency and on-

call duties. Id. at 639-40. The majority, too, finds this

diminution in income to be controlling. Yet, it must be

remembered that during the period of time (from September

1996 to December 1997) that Dr. Lasser was “totally

disabled,” he was attending to all his office functions and

tasks and he was performing scheduled (elective) surgery.

At the same time, he was collecting total disability benefits

from Reliance.

The District Court also relied on the various medical

reports from cardiologists, although they merely stated that

Dr. Lasser should not perform “emergency” and “on-call”

work—not that those functions were “material” to his

occupation of orthopedic surgeon. Id.

Reliance, on the other hand, presented evidence on the

issue of materiality. Reliance looked to the duties of a

general surgeon as defined in the Dictionary of

Occupational Titles (“DOT”) from the United States

Department of Labor. “Emergency” and/or “on-call” work

are not included in material duties. Dr. Lasser has

presented no evidence to the contrary.

Furthermore, the DOT is a recognized authority in the

vocational industry. See, e.g., Gallagher v. Reliance Life Ins.

Co., 305 F.3d 264, 272-73 (4th Cir. 2002) (DOT is an

objectively reasonable tool for determining the material

duties of an occupation; a “general job description of DOT,

to be applicable, must involve comparable duties but not

necessarily every duty.”) (emphasis added).

Similarly, the District Court gave no deference

whatsoever to Reliance in its use of a labor market survey.

This study provided direct evidence that “on-call” and

“emergency” duties—the only restrictions which Dr.

Lasser’s physicians proscribed—were not material. Dr.

Lasser provided no vocational studies nor, as I stated

earlier, any other evidence which contradicted Reliance’s

evidence on materiality.

23

Moreover, the use of such vocational studies in eligibility

for disability benefits is an accepted practice in this Circuit.

See, e.g., Russell v. Paul Revere Life Ins. Co., 288 F.3d 78,

79, 82 (3d Cir. 2002) (labor market study which identified

jobs within the claimant’s occupation that did not require

travel, contravened plaintiff ’s contention that he remained

disabled because he could not work extended hours and

travel, which his current position required).

All of this evidence stands unrebutted by Dr. Lasser.

Again, the appropriate standard of review is whether or not

Reliance was arbitrary and capricious in determining that

Dr. Lasser failed to meet his burden of materiality, that is:

that Dr. Lasser could not perform the material duties of his

regular occupation. Nowhere in this record is there

evidence that “emergency” and “on-call” tasks—the only

work which Dr. Lasser was told he could not perform—are

material to Dr. Lasser’s every day occupation. Although I

am sympathetic to Dr. Lasser’s financial and medical

difficulties—as I am sure the members of the majority are

too—such sympathy cannot substitute as evidence that

“emergency” and “on-call” work are material to the

occupation of an orthopedic surgeon.

Furthermore, I find it troubling that Dr. Lasser presented

no vocational study, nor any evidence from experts in the

field, or even evidence from the members of his own office

or himself, to support his contention that these tasks were

in fact material. In particular, there has been no evidence

as to whether his three partners could handle and would

respond to the practice’s on-call and emergency duties,

although such circumstances could lead to a diminution of

income for Dr. Lasser. There was also no evidence in the

record that Dr. Lasser could not perform scheduled elective

surgery, as well as all other office procedures and tasks.

III.

The majority, I sense, has fallen into the same pattern of

analysis employed by the District Court. Instead of

addressing and assessing the basis, the rationale and the

evidence which led to the Administrator’s determination

denying benefits, and then giving appropriate deference to

24

that determination, the majority discusses the evidence as

if it was subjected to de novo review after trial. In doing so,

it draws its own conclusions and substitutes its own

judgment as to who and what is to be believed.

Instead of looking to the evidence of materiality—(there is

none)—or the evidence of whether “emergency” and “on-

call” procedures are material—(the evidence is

uncontradicted that they are not)—the majority opinion

reviews the District Court record as if it arose from a non-

jury fact-finding trial. That, I suggest, was the error the

District Court fell into and it is compounded by the

majority of this panel.

I also find that the majority’s preoccupation with the

definition of “regular occupation” misses the mark. Here,

we are concerned only with the policy’s definition of “total

disability” which concentrates on material aspects of Dr.

Lasser’s practice. The majority relies on the Second

Circuit’s decision in Kinstler v. First Reliance Standard Life

Ins. Co., 181 F.3d 243 (2d Cir. 1999), even though that

case is distinguishable inasmuch as the standard of review

there, unlike here, was de novo. The majority further

strains to justify the term “regular occupation” by relying

on a Fourth Circuit unpublished opinion, O’Bryhim v.

Reliance Standard Life Ins. Co., 188 F.3d 502 (Table), 1999

WL 617891 (4th Cir. 1999) (unpublished per curiam). See

maj. op. at 7. A Fourth Circuit unpublished opinion under

no circumstances can be considered precedential by this

Court. In doing so, the majority opinion ignores the claim

evaluation framework established by the very language of

the Reliance policy that it quotes: First, the claimant’s

condition is evaluated. Next, the claimant’s regular

occupation is evaluated and the material duties thereof are

defined. Finally, the claimant’s condition is compared

against the material duties determined to be required in his

regular occupation. It appears that Dr. Lasser, the District

Court, and now this Court would end the inquiry after just

the first step.

IV.

Another example of the District Court’s failure to defer to

Walsh’s determinations revolves around Dr. Lasser’s

25

continuing to work while receiving disability payments of

about $6,000 a month, as well as Dr. Lasser’s return to

work after his benefits were discontinued.

Reliance argues that Dr. Lasser cannot be totally disabled

because in December 1997 he returned to “full-time”

unrestricted work, including “emergency” and “on-call”

duties, without consequence to his health. See App. at 263.

Reliance further contends that it was reasonable because

none of the doctors stated that he would be incapable of

performing a full-time schedule and Drs. Burke and Field

specifically evaluated Dr. Lasser as being capable of full-

time work.

The District Court concluded, and the majority here

agrees, that because Dr. Lasser risked future heart attacks

due to the stress from on-call and emergency duties—which

on this record cannot be characterized as material—his

continuing to work after the termination of his insurance

benefits nevertheless is evidence of his “total disability.” In

particular, the District Court focused on the fact that he

risked his health, against the express recommendations of

his doctors, by returning to those duties out of economic

necessity. Lasser II, 146 F. Supp. 2d at 626 n.5, 627, 630.

But, without satisfying the policy’s condition of inability to

perform tasks material to his occupation, I cannot agree

that Dr. Lasser, who was working in his office and

performing elective surgery, was “totally disabled.”

The Eighth Circuit has addressed this issue of relating

economic necessity to total disability in a context similar to

Dr. Lasser’s. In Galman v. Prudential Ins. Co. of America,

254 F.3d 768 (8th Cir. 2001), the Eighth Circuit held that

a claimant cannot assert total disability when he has

returned to work, regardless of whether he returned to

work out of “economic necessity” after an initial denial of

benefits while awaiting the results of his administrative

appeal. Galman, 254 F.3d at 771-72. Galman was a trial

attorney who suffered from coronary artery heart disease,

with a history of, inter alia, two prior heart attacks. He

based his disability claim, in part, on the risk of

aggravating his heart condition due to the stress of work.

After the claim was denied, Galman returned to work full

time asserting that the denial “forced him to return to work

26

for financial reasons.” Id. at 771. The court rejected his

claim for benefits. Id. at 772.

The majority implies that Dr. Lasser was unable to work

a forty-hour week, and thus was disabled. But the majority

misapprehends our jurisprudence. An insurer is not

arbitrary and capricious merely because it relies on other

medical opinions that result in a denial of coverage; it is

only arbitrary if such decision was “clearly not supported

by the evidence in the record or the administrator has

failed to comply with the procedures required by the plan.”

Abnathya v. Hoffmann-La Roche, Inc., 2 F.3d 40, 41 (3d Cir.

1993); see also, e.g., Orvosh v. Program of Group Ins. for

Salaried Employees, 222 F.3d 123, 129 (3d Cir. 2000);

Hightshue v. AIG Life Ins. Co., 135 F.3d 1144, 1148-49 (7th

Cir. 1998) (a plan’s decision, if reasonable, must be

affirmed even if the claimant presents an opposite position).

Here, Reliance has fully complied with all established

procedures and the Administrator’s record is replete with

evidence supporting the Administrator’s decision.

V.

Moreover, the District Court’s and the majority’s reliance

on the issue of “stress” does not do credit to their analyses.

Once again, I consider the evidence from the

administrative record through the lens of deference. Under

this deferential standard, it is clear that the District Court,

and then the majority, erred.

First, it is undisputed that none of the doctors who

supported the disability claim ever stated with any degree

of medical certainty the increased risk to Dr. Lasser of

returning to full-time employment. Reliance’s policy does

not insure against future disability—only present disability.

A doctor or other expert who determines that a patient is

disabled based on the possible future effects of stress

should have to quantity that risk so that the ERISA

decision maker can determine if it constitutes a present

disability. Thus, an opinion that Dr. Lasser’s venous graft

may not survive another five years does not satisfy the

condition of Reliance’s disability policy—a policy which

requires that Dr. Lasser be unable to perform the material

27

duties of his occupation at this time. To illustrate: I, as a

judge, may go blind in five years—but if I am not blind

now, that possibility cannot be deemed to render me

presently disabled.

I think we all recognize that stress, while it may affect

cardiac patients, does not necessarily incapacitate them, or

prevent them from successfully returning to, and

performing, stressful jobs, i.e., Vice President Dick Cheney.

See, e.g., Coker v. Metropolitan Life Ins. Co., 281 F.3d 793,

796, 798-99 (8th Cir. 2002) (plan not arbitrary and

capricious in denying benefits, even where the claimant’s

doctor declared him disabled based on the exacerbating

factor of stress); Gooden v. Provident Life & Accident Ins.

Co., 250 F.3d 329, 335 n.8 (5th Cir. 2001) (dismissing

claimant’s complaint that his insurance company failed to

account for his doctor’s concern of the stress associated

with his job).

Based on the administrative record, it was not arbitrary

and capricious for Reliance to determine that Dr. Lasser

was not “disabled” based on any risk of relapse from stress.

Indeed, stress tests subsequent to his heart attack in July

1996 did not reveal any chest pain or EKG abnormalities

during cardiac testing, only a “very small myocardial

infarction” which was “very small and probably clinically

insignificant.” App. at 208. Three cardiologists rated Dr.

Lasser at a Functional Class I level for physical capacity on

the New York Heart Association Functional Classification

System, which level designates “[p]atients with cardiac

disease but with no limitation of physical activity.” Lasser

II, 146 F. Supp. 2d at 626. Dr. Aldrich’s March 25, 1998

report states: “I do not disagree [with Dr. Burke] that by all

objective criteria Dr. Lasser is doing very well at this point

in time” and also reports that Dr. Lasser “does not

currently have any symptoms, his examination is negative

with respect to the cardiovascular system, and his stress

test from April of 1997, as well as the stress test performed

by Dr. Burke showed good exercise capacity . . . .” App. at

222. Dr. Raska’s August 5, 1998 report confirmed Dr.

Lasser’s cardiovascular fitness as “excellent,” his cardiac

condition as stable and further stated that patients with a

New York Heart Association Functional Class I level

28

typically have “an overall low risk of cardiovascular

morbidity or mortality.” App. at 229.

VI.

I believe that the District Court should have determined,

on the established administrative record, whether the

Administrator abused his discretion and was arbitrary and

capricious in determining at least the following matters:

(a) Did Dr. Lasser meet his burden of establishing the

material tasks and aspects of his practice?

(b) Are emergency surgeries and on-call duties material

parts of Dr. Lasser’s functions as an orthopedic surgeon?

(c) Could and did Dr. Lasser perform elective

(scheduled, not emergency) surgery as material procedures

of his occupation?

(d) Could Reliance’s policy as drawn take into account

future disabilities that Dr. Lasser may suffer or was it

limited to only the current or present disability which Dr.

Lasser may or may not have?

It is these matters with which the District Court had to

concern itself in determining whether the Administrator’s

denial of benefits was arbitrary and capricious. By failing to

do so, I believe the District Court erred.

One last word on this subject. I am troubled by the

District Court’s reliance on the Ninth Circuit’s de novo

standard in Kearney. See supra note 3. While Kearney may

have its advocates, and I cannot help but note that the

Ninth Circuit en banc court was severely divided, we have

yet to depart from established review standards in ERISA

and summary judgment cases. To my mind, the District

Court’s abrogation of both these standards in favor of a

Kearney review, rings a warning bell that cannot be

ignored.

Had the District Court conducted its hearing as I

suggested it should, that is, confining itself only to the

resolution of whether Walsh was conflicted or biased, and

had the District Court then resorted to the traditional

summary judgment resolution based only on the record

29

below, I would not have raised this issue. But this is not

the way this case played out, as I have noted. If we permit

the review that took place in this case, I fear it will signal

to district courts in the future that they are free, in similar

cases, to hold merits hearings and thus to deviate from the

summary judgment and Pinto standards.

Thus, in sum, I would reverse the District Court’s

judgment in favor of Dr. Lasser and remand for the District

Court to properly consider this case under the summary

judgment standard, giving Pinto deference to Walsh’s

determinations. As the Supreme Court just recently noted,

a court must actually apply the correct standard; mere lip-

service and mere citation to a standard of review will not

suffice. See Price v. Vincent, 123 S. Ct. 1848, 1852 (2003)

(holding that the Sixth Circuit recited the correct standard

of review under 28 U.S.C. § 2254(d)(1) but then did not

apply it when it reviewed the double jeopardy question at

issue.)

Thus, I respectfully dissent.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit