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Long Term Disability ERISA Case VIctory-Court Orders Payment of all “Own Occupation” Benefits

In a recent ERISA Long Term Disability case, the Court granted Plaintiff’s Motion for summary judgment and ordered Defendant to pay all of Plaintiff’s overdue benefits during the “own occupation” period.

In _____________ v The Great Atlantic & Pacific Tea Company LTD Plan, the Honorable George Caram Steeh (E.D. Michigan) confirmed that Defendant had improperly withheld payment of LTD benefits during the Plan’s “own occupation” period despite the fact that Defendant had obtained numerous “paper reviews” by its own physicians. The Court ordered Defendant to pay all of the overdue benefits and ordered Defendant to reconsider its decision under the “any occupation” definition of disability.

This case demonstrates the critical importance of determining the correct standard of review.

Defendant had strenuously argued that the Court should apply an “arbitrary and capricious” standard of review which provides significant deference to the Plan’s decision and can be difficult for Plaintiff’s to overcome. Plaintiff, however, successfully argued that the Court should apply the De Novo standard of review as the plan really did not vest discretionary authority in the party who actually made the claims denial decision. (Connecticut General). Under the De Novo standard the Court concurred that the benefits had been wrongfully denied. Not only did the Court order the payment of the past due benefits for the “own occupation” period but the Court also ordered Defendant to pay the Plaintiff’s attorney fees.