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Now That My ERISA Lawsuit Has Been Filed, What Will the Judge Consider

Discovery, or the process whereby parties to litigation exchange information with one another, typically takes the form of responding to document requests, answering interrogatories, and sitting for a deposition. If the lawsuit involves a claim for disability benefits under ERISA, however, these same forms of discovery may not be available to the client.

Most Federal Courts have adopted a system whereby a decision on the insurance company’s denial is based on the existing administrative record that existed at the time of the final denial. Set forth below is a summation of recent court decisions relating to whether discovery would be allowed in the underlying lawsuit. See Hogan-Cross v. Metropolitan Life Ins.Co., 2008 U.S.Dist.LEXIS 58027 (S.D.N.Y. July 31, 2008) (permitting discovery relating to the compensation paid to employees and outside consultants involved in denying the plaintiff’s claim for benefits); Gessling v. Group Long Term Disability Plan for Employees ofSprint/United Management Co., 2008 U.S.Dist.LEXIS 96623(S.D.Ind. November 26, 2008) (granting the plaintiff’s motion to compel the production of performance evaluations or performance reviews of the plaintiff’s claim during the period three years prior and one year subsequent to denial); Pemberton v. Reliance Standard Life Ins.Co., 2009 U.S.Dist.LEXIS 2070 (E.D.Ky. January 13, 2009) (permitting discovery, limited to a span of ten years, with respect to contractual connections between insurer and the claims reviewers, financial payments paid annually to reviewers, and the statistical data about the number or claims filed sent to the reviewers and the number of denials which result but did not allow discovery regarding the background of the reviewers such as their criminal, board certification, and patient treatment histories); Christie v. MBNA Long Term Disability Plan, No. 1:08 CV 44 JAW, 2008 WL 4427192, at *1, *3 (D. Me. Sept.25, 2008) (denying plaintiff’s motion for discovery of the administrator’s internal policies and procedures, incentive programs, and structures for “walling off” claims handlers); Marszalek v. Marszalek & Marszalek Plan, No. 06 C 3558, 2008 WL 4006765, (N.D.Ill. Aug.26, 2008) (concluding that plaintiff’s speculation that bonuses received by insurer’s executives resulted in a denial of claims was insufficient to make a prima facie showing that there was good cause to believe that limited discovery would reveal a procedural defect); Kendel v. Zurich American Ins. Co., No. 4:09CV00040 SWW, 2009 WL 3063363 (E.D. Ark. Sept. 21, 2009) (finding that the administrative record presented no apparent conflict, the court held that plaintiffs had failed to establish good cause for ordering discovery); and Thompson v. UBS Financial Servs., Inc., C.A. No. 09-033S, 2009 WL 2986395 (D.R.I. Sept. 15, 2009) (denying defendant’s motion for protective order and allowed discovery into potentially pernicious effects of structural conflicts of interest because administrative record did not contain any evidence with respect to insurer’s conflict ameliorating procedures)

Whether a particular judge will allow a plaintiff to seek discovery beyond the administrative record is a matter within the judge’s discretion. Unfortunately, it can simply be a case of luck of the draw whether any discovery aimed at uncovering conflicts of interest, bias and/or payment of monetary incentives is allowed.