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Kendra James-Smith, Etc v. Total Affiliates Accidental Death and Dismemberment Insurance Plan

October 13, 2011


The opinion of the court was delivered by: Judge Jack Zouhary



"Nothing is certain," Benjamin Franklin famously wrote, "except death and taxes." This case is about the foreseeability of death and the contracts made to benefit from it. Specifically, before this Court is Plaintiff Kendra James-Smith's Motion for Summary Judgment (Doc. No. 14), and Defendants' Motion for Judgment on the Administrative Record (Doc. No. 15). This Court treats these as cross motions for judgment on the administrative record. Plaintiff is the named beneficiary under a group accidental death plan ("Plan") provided by LifeInsurance Company of North America ("LINA"). Plaintiff is the beneficiary under the Plan (Doc. No. 13 at 2). Defendants are the sponsors and administrators of the Plan. This Court has jurisdiction under the Employee Retirement Income Security Act of 1974 ("ERISA"). 28 U.S.C. §§ 1001 et seq.


In June 2008, Paul Smith, husband of Plaintiff, was northbound on his motorcycle, with passenger Monica Ohlemacher, on State Route 4 in Erie County, Ohio. A southbound vehicle made a left-hand turn onto Bogart Road in front of Smith just as he was entering the intersection. The driver of the turning vehicle, Larry McCready, never saw the motorcycle (Doc. No. 20-2 at 13). A horrific collision resulted, ejecting both occupants of the motorcycle (Doc. No. 20-2 at 11). Ohlemacher was severely injured, and Smith did not survive (Doc. No. 20-2 at 8). The cause of death listed on the coroner's report was "massive head and chest injuries," and the manner of death as "accident" (Doc. No. 20-1 at 44).

A witness, traveling south on State Route 4 as Smith passed by, estimated that Smith accelerated to 70 mph as he approached the intersection (Doc. No. 20-2 at 7), where the posted speed was 55 mph (Doc. No. 20-2 at 2). The witness saw Smith swerve to avoid the collision but did not brake (Doc. No. 20-2 at 17--18). At the time of the accident, Smith's blood alcohol content ("BAC") was .09% (Doc. No. 13 at 2). The legal BAC in Ohio is .08% (Doc. No. 13 at 2).

The Ohio State Highway Patrol noted Smith was not wearing a helmet, found no signs of braking, and listed the cause of the crash as McCready's failure to yield (Doc. No. 20-2 at 2, 11). A further investigation, to determine the speed of Smith's motorcycle at the time of the accident, is not included in the record. Nearly four months after the accident, Trooper Anthony Scherley, one of the first at the scene, told a claims specialist for Defendants that Smith's BAC of .09% "definitely was [a factor] as it would have slowed down his reaction time" (Doc. No. 20-1 at 22). The record includes no other opinions regarding the cause of the crash.

Under the terms of the Plan, a "Covered Accident" is defined as "A sudden, unforeseeable, external event that results, directly and independently of all other causes, in a Covered Injury or Covered Loss . . . not otherwise excluded under the terms of this Policy." (Doc. No. 20-1 at 16) (emphasis added). The Plan's Common Exclusion ("alcohol exclusion" or "exclusion") states:

[B]enefits will not be paid for any Covered Injury . . . which, directly or indirectly, in whole or in part, is caused by or results from . . . operating any type of vehicle under the influence of alcohol . . . . Under the influence of alcohol, for the purposes of this exclusion, means intoxicated, as defined by the law of the state in which the covered Accident occurred." (Doc. No. 20-1 at 17) (emphasis added).

Plaintiff's application for death benefits under the Plan was denied (Doc. No. 20-1 at 16). Plaintiff appealed and was again denied death benefits (Doc. No. 20-1 at 4). Each denial was based on two independent grounds: (1) Smith's death is not a Covered Accident because it was foreseeable in light of his intoxication, and (2) Smith's death falls under the alcohol exclusion because his intoxication "directly or indirectly, in whole or in part" caused his death (Doc. No. 20-1 at 6, 18). This lawsuit followed (Doc. No. 1).


In reviewing a denial of benefits by a plan administrator under 29 U.S.C. § 1132(a)(1)(B), a district court must "conduct its review based solely upon the administrative record." Cooper v. Life Ins. Co. of North America, 486 F.3d 157, 171 (6th Cir. 2007) (quoting Wilkins v. Baptist Healthcare Sys., Inc., 150 F.3d 609, 619 (6th Cir. 1998)) (internal quotation marks omitted). Under this standard, the court considers "only the facts known to the plan administrator at the time he made his decision." Smith v. Ameritech, 129 F.3d 857, 863 (6th Cir. 1997) (quoting Yeager v. Reliance Standard Life Ins. Co., 88 F.3d 376, 381 (6th Cir.1996)) (internal quotation marks omitted). The court may not consider evidence beyond the administrative record unless it "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." Id. (quoting Wilkins, 150 F.3d at 619) (internal quotation marks omitted). No such challenge is made here. This Court therefore considers only the evidence in the administrative record.

The court ordinarily reviews the administrator's decision using "a de novo standard unless 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). However, if a plan vests such discretion in the administrator, the court reviews its decisions under the arbitrary and capricious standard. See Borda v. Hardy, Lewis, Pollard & Page, P.C., 138 F.3d 1062, 1066 (6th Cir. 1998) (citation omitted). The parties agree this latter standard applies (Doc. No. 14 at 6; Doc. No. 15-1 at 6). This standard is highly deferential and is "the least demanding form of judicial review of administrative action . . . . When it is possible to offer a reasoned explanation, based on the evidence, for a particular outcome, that outcome is not arbitrary or capricious." Abbott v. Pipefitters Local Union No. 522, 94 F.3d 236, 240 (6th Cir. 1996) (citation omitted); see also Calvert v. Firstar Fin., Inc., 409 F.3d 286, 292 (6th Cir. 2005) (quoting McDonald v. Western-Southern Life Ins. Co., 347 F.3d 161, 169 (6th Cir. 2003)).

Another way of stating the standard of review that guides this Court is whether the plan administrator's decision was reasonable. "A decision is not arbitrary and capricious if it is based on a reasonable interpretation of the plan." Shelby County Health Care Corp. v. Southern Council of Indus. Workers, 203 F.3d 926, 933 (6th Cir. 2000) (citing Johnson v. Eaton Corp., 970 F.2d 1569, 1574 (6th Cir. 1992)). "The district court must affirm an employer's or insurer's decision if evidence in the record reflects any reasonable explanation for the decision." Clark v. Lennox Indus., Inc., 1994 WL 445222, at *1 (6th Cir. 1994) (citing Davis v. Kentucky Fin. Cos. Retirement Plan, 887 F.2d 689, 693--94 (6th Cir. 1989)). The court "must decide whether the administrator's decision was rational in light of the plan's provisions." Williams v. Int'l Paper Co., 227 F.3d 706, 712 (6th Cir. 2000) (internal quotation ...

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