United States District Court, D. New Jersey
MEMORANDUM AND ORDER
G. SHERIDAN, U.S.D.J.
matter is before the Court on Defendant First Reliance
Standard Life Insurance Company's ("Defendant"
or "Standard Life") Motion for Summary Judgement
(ECF No. 27) and Plaintiff Jody Rizzo's ("Plaintiff
or "Mrs. Rizzo") Cross Motion for Summary Judgment
(ECF No. 30). In this action, Plaintiff alleges that
Defendant wrongfully denied her request for life insurance
benefits under her deceased husband's group life
insurance policy in violation of the Employee Retirement
Income Security Act ("ERISA"). In the instant
motions, the parties dispute: (1) whether Plaintiff was
required but failed to exhaust administrative remedies prior
to bringing this ERISA action; and (2) whether Defendant
wrongfully denied Plaintiff's request for benefits.
January 10, 2017, Plaintiff initiated this lawsuit against
Defendant and Barnes and Noble, Inc. in the Superior Court of
New Jersey, Ocean County. On February 3, 2017, Defendant
removed the matter to this Court based upon allegations
concerning ERISA violations. (ECF No. 1). Plaintiff's
seven-count complaint included five claims under New Jersey
law (Counts I-V) and two claims under ERISA (Counts VI-VII).
February 8, 2017, Defendants moved to dismiss the complaint
for failure to state a claim upon which relief can be
granted. (ECF No. 4). On December 28, 2017, the Court granted
in part and denied in part Defendant's motion to dismiss.
(ECF No. 11). Specifically, the Court dismissed all of
Plaintiff's state law claims (Counts I-V) on ERISA
preemption grounds, as well as dismissed Plaintiff's
"catchall" ERISA claim under 29 U.S.C. §
1132(a)(3) (Count VII). (See id.). But, the Court
did not dismiss Count VI, or Plaintiff's claims for the
wrongful denial of benefits brought under 29 U.S.C. §
1132(a)(1)(b), finding that "when reviewing the record
in the light most favorable to Plaintiff, the Court [was]
satisfied for purposes of [the] motion to dismiss that
Plaintiff exhausted administrative remedies." (ECF No.
11 at 11). After engaging in discovery, the issue of whether
Plaintiff exhausted administrative remedies is once again in
contention. The parties also disagree as to whether
Defendant's denial of benefits was wrongful.
October 9, 2009, Angelo Rizzo, Plaintiff's late husband,
was diagnosed by Dr. Riss, his family doctor, with carotid
disease, diabetes, hypertension. (Plaintiff, Jody
Rizzo's, Statement of Facts ("Plaintiff's
Undisputed Facts") ¶ 1, ECF No. 30-2). On or about
November 7, 2012, Mr. Rizzo began experiencing shortness of
breath and dizziness while shoveling snow, which he reported
to Dr. Riss. (Id. ¶ 3). Dr. Riss referred Mr.
Rizzo to his cardiologist. (Id.). Upon referral, on
or about November 12, 2012, Mr. Rizzo was diagnosed with
chest pain, shortness of breath, palpitations, dizziness,
edema, diabetes type II, cardiomyopathy, hypertension,
obesity, and lymphedema. (Id. ¶ 4). At or
around this time, Mr. Rizzo's poor health prompted him to
cease working for Barnes & Noble, where he was employed
as an Assistant Store Manager. (See Defendant, First
Reliance Standard Life Insurance Company's Local Rule
56.1 Statement in Support of its Motion for Summary Judgment
Under ERISA ("Defendant's Undisputed Facts")
¶ 7, ECF No. 27-6). Fifteen months later, on February
24, 2014, Mr. Rizzo passed away at the age of 42. (Plaintiffs
Undisputed Facts ¶ 6).
issued Barnes & Noble, Mr. Rizzo's once-employer, two
separate group insurance policies, including: (1) a long term
disability policy; and (2) a group life insurance policy.
(Defendant's Undisputed Facts ¶¶ 1, 2, 4). This
lawsuit involves only Plaintiff's claim for benefits
under the group life insurance policy (the
"Policy"). (Id. ¶ 9).
Policy included a waiver of premium provision
("WOP") in the event of "total
disability." (Id. ¶ 4). The WOP benefit
pays for a plan participant's life insurance premium if
that person becomes "totally disabled." Important
to this lawsuit, the Policy defined total disability as a
"complete inability to engage in any type of work for
wage or profit for which he/she is suited by education,
training or experience." (Id. ¶ 6).
letter dated March 1, 2013, Defendant wrote to Mr. Rizzo
informing him that he might be eligible for WOP benefits
under the Policy. (Id. ¶ 10). Defendant
provided Mr. Rizzo with instructions on how to apply for WOP
benefits, as well as explained that Mr. Rizzo's employer
could only maintain his life insurance coverage by paying
premiums for seven additional months. (Id.
¶¶ 11, 12). Because Mr. Rizzo was no longer working
at this point, Defendant explained that coverage would then
end unless his WOP application was approved or if he
converted the group life insurance policy into an individual
policy within thirty-one days of any denial of his WOP
application. (Id. ¶ 13).
about March 18, 2013, Mr. Rizzo applied for WOP benefits,
which was received by . Defendant on March 27, 2013.
(Plaintiff's Undisputed Facts ¶¶ 8, 11). On
October 9, 2013, Mr. Rizzo's WOP application was denied.
(Defendant's Undisputed Facts ¶ 15). A letter dated
October 9, 2013 (the "October 9th
Letter") presented the basis for denial, which was
Defendant's conclusion that Mr. Rizzo was not
"totally disabled" pursuant to definition of the
term as provided above. Specifically, the letter stated that
Mr. Rizzo was not totally disabled because he could perform
sedentary occupations; as such, he was not entitled to WOP
We have found that as of November 8, 2012 through November 1,
2013 you are capable of sedentary work exertion. Since you
are capable of sedentary work exertion, we referred your file
to our vocational department to review for viable occupations
that would be commensurate with your work history. Our
vocational staff found the following viable sedentary
occupations that you would be eligible for: Representative
Supervisor; Personal Scheduler; Customer-Complaint Clerk;
(See LTD 432-34, ECF No. 27-5). The October
9th Letter also explained that Mr. Rizzo was
entitled to request a review of this denial by submitting an
appeal within 180 days of the receipt of the October
9th Letter, or by April 7, 2014, and provided
instructions on how to submit such a review:
You may request a review of this determination by submitting
your request in writing to:
First Reliance Standard Life Insurance Company Quality Review
Unit P.O. Box 7698 Philadelphia, PA 19101-7698
This written request for review must be submitted within 180
days of your receipt of this letter. Your request should
state any reasons why you feel this determination is
incorrect, and should include any written comments,
documents, records, or other information relating to your
claim for benefits. Only one review will be allowed, and your
request must be submitted within 180 days of your receipt of
this letter to be considered.
Under normal circumstances, you will be notified in writing
of the final determination within 45 days of the date we
receive your request for review. If we determine that special
circumstances require an extension of time for processing,
you will ordinarily be notified of the decision no later than
90 days of the date we receive your request for review.
(LTD433). Mr. Rizzo, nor Plaintiff, appealed this denial
within 180 days of the October 9th Letter. Rather,
Plaintiff did not attempt to appeal from this decision until
July 25, 2016. (Defendant's Undisputed Facts ¶ 25).
parties dispute whether Defendant mailed the October
9th Letter to Plaintiff on October 9, 2013. While
Defendant contends that the October 9th Letter was
indeed mailed to Plaintiff on or around October 9, 2013,
Plaintiff alleges that she only found out about the denial of
WOP benefits, as provided in the October 9th
Letter, upon contacting Defendant on the day of Mr.
Rizzo's passing, or on February 24, 2014. Plaintiff
further contends that she did not receive the October
9th Letter until March 6, 2014 and only then upon
foregoing facts bring about a critical dispute in the instant
motions, that is, whether Plaintiff exhausted administrative
remedies in light of the undisputed fact that she, nor her
husband, appealed Defendant's decision to deny her WOP
application within 180 days of the October 9th
Letter. As discussed more comprehensively below,
Defendant's position is that Plaintiffs failure to appeal
the denial of benefits within 180 days is dispositive and
warrants dismissal of this action. Plaintiff rebuts
Defendant's contention by setting forth several reasons
as to why Plaintiff was not required to exhaust
administrative remedies prior to bringing this lawsuit,
including, inter alia, because Defendant allegedly
violated ERISA's 90-day adverse benefit notification
requirement. (Pl. Br. at 21, ECF No. 30-3).
the parties also dispute whether Defendant's adjudication
and denial of Mr. Rizzo's WOP application was wrongful,
as analyzed under either a de novo or arbitrary and
capricious standard of review. In particular, Plaintiff
argues that Defendant's failure to review all of the
medical records and internal files prior to making a decision
to deny Mr. Rizzo's WOP application renders it wrongful
under either standard. Defendant rebuts that the decision to
deny Mr. Rizzo's application was appropriately based on
written submissions from Dr. Riss, Mr. Rizzo's family
doctor, indicating that Mr. Rizzo can still perform sedentary
work. (See Defendant's Br. at 12-13, ECF No.
Standard Summary judgment is appropriate under Federal
Rule of Civil Procedure 56(c) when the moving party
demonstrates that there is no genuine issue of material fact
and the evidence establishes the moving party's
entitlement to judgment as a matter of law. Celotex Corp.
v. Catrett, 477 U.S. 317, 322-23 (1986). A factual
dispute is genuine if a reasonable jury could return a
verdict for the non-movant, and it is material if, under the
substantive law, it would affect the outcome of the suit.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986). In considering a motion for summary judgment, a
district court may not make credibility determinations or
engage in any weighing of the evidence; instead, the
non-moving party's evidence "is to be believed and
all justifiable inferences are to be drawn in his
favor." Marino v. Indus. Crating Co., 358 F.3d
241, 247 (3d Cir. 2004) (quoting Anderson, 477 U.S.
the moving party has satisfied its initial burden, the party
opposing the motion must establish that a genuine issue as to
a material fact exists. Jersey Cent. Power & Light
Co. v. Lacey Twp.,772 F.2d 1103, 1109 (3d Cir. 1985).
The party opposing the motion for summary judgment cannot
rest on mere allegations and instead must present actual
evidence that creates a genuine issue as to a material fact
for trial. Anderson, 477 U.S. at 248; Siegel
Transfer, Inc. v. Carrier Express, Inc.,54 F.3d 1125,
1130-31 (3d Cir. 1995). "[Unsupported allegations ...
and pleadings are insufficient to repel summary
judgment." Schoch v. First Fid. Bancorp., 912
F.2d 654, 657 ...