Bob G. Wilkins v. Baptist Healthcare System, Inc. Life Insurance Company of North America

GILMAN, Circuit Judge,

concurring.

Judge Ryan and I fully concur in the result reached by Judge Cole and in all of the reasoning expressed in his opinion, except for that portion of the opinion under Part II.F. (Summary Judgment in ERISA cases).

There appears to be great confusion among the district courts as to the proper method of adjudicating proceedings brought under 29 U.S.C. § 1132 (a)(1)(B) (“ERISA actions”). Some district courts conduct a bench trial on the merits of an ERISA action under Fed.R.Civ.P. 52, while others utilize the summary judgment procedures set forth in Fed.R.Civ.P. 56. We believe that both approaches are inconsistent with the appropriate standard of review set forth by this *618 court in Perry v. Simplicity Engineering, 900 F.2d 963 (6th Cir.1990), which is as follows:

[T]he district court will review the administrator’s decision de novo, that is without deference to the decision or any presumption of correctness, based on the record before the administrator. Thus, [Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 , 109 S.Ct. 948 , 103 L.Ed.2d 80 (1989) ] does not require district courts to hear and consider evidence not presented to the plan administrator in connection with a claim. This view is consistent with the proper judicial role in ERISA cases and precedent.

Id. at 966. This standard of review does not neatly fit under either Rule 52 or Rule 56, but is a specially fashioned rule designed to carry out Congress’s intent under ERISA.

The confusion referred to above is evident in the case before us. Although styling its dispositive motion as one seeking “summary judgment,” LINA acknowledged in its brief filed with the district court that the motion “differs from most summary judgment motions,” and submitted that the district court’s review of the merits of Wilkins’s action was limited to the evidence presented to LINA at the time LINA’s denial of benefits became final. The district court then proceeded with its analysis without referring to Fed.R.Civ.P. 56 or determining whether there was a genuine issue as to any material fact. Nevertheless, the district court entered a judgment that is captioned “SUMMARY JUDGMENT.”

A. The Problem with the Bench Trial Standard

When an ERISA plan does not clothe its administrator with discretionary authority to determine eligibility for benefits or to interpret the terms of the plan, the administrator’s denial of benefits is reviewed de novo by a district court regarding both the administrator’s interpretation of the plan’s terms and its factual findings. Bruch, 489 U.S. at 115 , 109 S.Ct. 948 ; Rowan v. Unum Life Ins. Co., 119 F.3d 433, 435 (6th Cir.1997). In conducting its de novo review, a district court may only consider evidence that was first presented to the administrator. Rowan, 119 F.3d at 437 ; Perry, 900 F.2d at 966 . Perry articulated the following policy rationale in support of so constraining a district court’s review:

A primary goal of ERISA was to provide a method for workers and beneficiaries to resolve disputes over benefits inexpensively and expeditiously. Permitting or requiring district courts to consider evidence from both parties that was not presented to the plan administrator would seriously impair the achievement of that goal. If district courts heard evidence not presented to plan administrators, employees and their beneficiaries would receive less protection than Congress intended.

900 F.2d at 967 (citations omitted).

In light of these precedents, we are satisfied that a district court should not adjudicate an ERISA action as if it were conducting a standard bench trial under Rule 52. Such a proceeding would inevitably lead to the introduction of testimonial and/or other evidence that the administrator had no opportunity to consider. A district court’s evaluation of such evidence would contravene Perry’s mandate confining the district court’s de novo review to the evidence contained in the administrative record. Moreover, the disposition of an ERISA action in a standard bench trial is inconsistent with ERISA’s goal of providing an inexpensive and expeditious method of resolving benefits disputes. See Perry, 900 F.2d at 967 .

The only exception to the above principle of not receiving new evidence at the district court level arises when consideration of that evidence is necessary to resolve an ERISA claimant’s procedural challenge to the administrator’s decision, such as an alleged lack of due process afforded by the administrator or alleged bias on its part. See, e.g., VanderKlok v. Provident Life and Accident Ins. Co., Inc., 956 F.2d 610, 617 (6th Cir.1992) (insured permitted to present new evidence because the administrator failed to provide insured with proper notice as required by the administrative hearing procedures).

*619 B. The Problem with the Summary Judgment Standard

A discussion of the summary-judgment procedure necessarily begins with the language of Rule 56, which provides in relevant part as follows:

Rule 56. Summary Judgment

(c) Motion and Proceedings Thereon. The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

(emphasis added). As articulated by the United States Supreme Court, the function of a district court at the summary-judgment stage is not to “weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 , 106 S.Ct. 2505 , 91 L.Ed.2d 202 (1986). A district court accomplishes this task by determining whether “there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party.” Id. at 250 , 106 S.Ct. 2505 .

The preceding analysis illustrates precisely why the concept of summary judgment is inapposite to the adjudication of an ERISA action. Because this court’s precedents preclude an ERISA action from being heard by the district court as a regular bench trial, it makes little sense to deal with such an action by engaging a procedure designed solely to determine “whether there is a genuine issue for trial.” See Anderson, 477 U.S. at 249 , 106 S.Ct. 2505 .

We suspect that the summary-judgment mode of analysis has been uncritically utilized time and again because district courts tend to concur with the ruling of the administrator in an ERISA action. In such a case, no harm is done by entering summary judgment in favor of the administrator. See, e.g., Perry, 900 F.2d at 967 (affirming the district court’s grant of summary judgment in favor of the administrator on the ground that “no other result was possible, even if the de novo standard had been utilized.”). If, on the other hand, a district court rejects the ruling of the administrator, the district court would then have to independently weigh the evidence in the administrative record and render de novo factual determinations. See Rowan, 119 F.3d at 437 . There thus appears to be no benefit in having the district court first filter the administrator’s ruling through a summary-judgment strainer.

In sum, the logic of Rule 56 does not comport with the Perry and Rowan standard of review. Rule 56 is designed to screen out cases not needing a full factual hearing. To apply Rule 56 after a full factual hearing has already occurred before an ERISA administrator is therefore pointless.

C. Suggested Guidelines

In light of the Perry standard quoted above, a district court should employ the following steps in adjudicating an ERISA action:

1. As to the merits of the action, the district court should conduct a de novo review based solely upon the administrative record, and render findings of fact and conclusions of law accordingly. The district court may consider the parties’ arguments concerning the proper analysis of the evidentiary materials contained in the administrative record, but may not admit or consider any evidence not presented to the administrator.

2. The district court may consider evidence outside of the administrative record only if that evidence is offered in support of a procedural challenge to the administrator’s decision, such as an alleged lack of due process afforded by the administrator or alleged bias on its part. This also means that any prehearing discovery at the district court level should be limited to such procedural challenges.

3. For the reasons set forth above, the summary judgment procedures set forth in Rule 56 are inapposite to ERISA actions and thus should not be utilized in their disposition.

*620 D. Disposition of the Instant Case

In the present matter, the district court erroneously labeled its ruling in favor of the defendants as one for summary judgment. Nevertheless, the district court properly adjudicated Wilkins’s action by conducting a de novo review of LINA’s decision based solely upon the administrative record, and found no objective evidence supporting Wilkins’s claim of disability. We agree with the district court’s determination and therefore concur in affirming the entry of judgment in favor of LINA, notwithstanding the label attached to the disposition of the action.

While Judge Cole characterizes our suggested guidelines as having no bearing on the resolution of the case at bar, he acknowledges Wilkins’s argument that summary judgment is not appropriate for deciding an ERISA action because such an action should generally be decided in a proceeding resembling a bench trial. Rather than ignore Wilkins’s argument, we have applied well-settled precedent to conclude that a district court should employ neither summary judgment nor a bench trial in deciding ERISA actions. In so doing, we have recognized that both methods of disposition have been uncritically but erroneously utilized.

Moreover, Judge Cole claims that we are devising a procedure that “has neither been mandated by Congress nor recognized by any other court.” To the contrary, the suggested guidelines enumerated above are simply a restatement and application of principles previously espoused by this court and by the Supreme Court. Indeed, our conclusion that ERISA actions ought not be decided in bench trials (thus rendering summary judgment inapposite) is perfectly consistent with Congress’s goal in enacting ERISA, i.e., to provide workers and beneficiaries with an inexpensive and expeditious method of resolving benefits disputes. See Perry, 900 F.2d at 967 .