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This month’s Friday Five explores the linear relationship between the information that must be exchanged between a claimant and a claims administrator and a court’s subsequent determination of a dispute between the two. The information exchanged may take the form of the administrative record compiled by the insurer, the pleadings filed by the parties, discovery exchanged in litigation, and others. From those sources of information, courts determine what evidence is and is not appropriately before the court, and it is from that established evidentiary record that courts are able to render decisions on issues such as discovery disputes, appeals from benefit denials and motions for the award of attorney fees and costs.
The Saul Ewing ERISA Litigation Team
- Will a court enforce an exclusion in an accidental death and dismemberment where the death is caused or contributed to by diagnosis or treatment of an underlying illness or infirmity? Yes, where the insurer otherwise complies with all other applicable standards of claims handling. Charles Kleinsteuber’s wife Dana was diagnosed with end-stage renal disease (ESRD) and was treating with home dialysis. She died on January 18, 2022 after going into cardiac arrest from severe blood loss because she forgot to close a chest port used in the dialysis. Kleinsteuber filed an AD&D claim under his employer’s ERISA plan. While the death was accidental, the insurer denied the claim based on an exclusion “for any loss caused or contributed to by … physical or mental illness or infirmity, or the diagnosis or treatment of such illness or infirmity.” The insurer had discretionary authority to interpret the terms of the ERISA plan. On cross-motions for summary judgment, the district court entered judgment in favor of the insurer. In affirming the decision, the Eighth Circuit determined that the insurer provided Kleinsteuber with a full and fair review because the administrative record as a whole demonstrated that the insurer adequately informed Kleinsteuber of the exclusion that formed the basis of the denial of the claim. The appellate court acknowledged the conflict of interest because the insurer both determines eligibility for claims and pays benefits out of its own pocket, but determined that Kleinsteuber failed to establish any link between that conflict and the claim denial. The appellate court also determined that the insurer properly interpreted the exclusion because the decedent’s ESRD or home dialysis was one of the reasons for her death. The appellate court also determined that there was substantial evidence supporting the conclusion that the decedent’s death was caused or contributed to by the home dialysis. Kleinsteuber v. Metropolitan Life Ins. Co., No. 25-2860, 2026 WL 1502873 (8th Cir. May 29, 2026).
- Will a court award attorney fees and costs where a successful insured demonstrates that she is both eligible for and entitled to fees? Yes, where the insured is able to satisfy the applicable test for entitlement to fees. Frances Ryan was an internal medicine physician who was determined eligible for LTD benefits after sustaining a fall and suffering a concussion. Her insurer later terminated those benefits, but the district court determined that termination was arbitrary and capricious, and remanded the matter to the insurer after which the insurer reinstated the LTD benefits with back pay. In considering Ryan’s motion for fees and costs, the court ruled that Ryan was eligible for an award of attorney fees because she easily met the standard of achieving “some success on the merits.” The court rejected as baseless the insurer’s argument that Ryan was ineligible because her result in the district court was “purely procedural.” In ruling whether Ryan was entitled to attorney fees, the district court utilized the Seventh Circuit’s five-factor test and “substantially justified” test. The court ruled that the factor of the insurer’s ability to pay weighed heavily in favor of Ryan because the “defendant is a large insurance company.” The court also determined that the factor of potential to deter similar conduct in the future weighed in favor of Ryan because of the insurer’s conflicted position of determining benefit eligibility and paying benefits out of its own pocket. The court ruled that the factors about defendant’s culpability and the relative merits of the parties’ positions tilted in favor of plaintiff, even though the court conceded that the administrative record contained conflicting medical evidence. The court ruled that the final factor, benefit conferred on plan members, also favored plaintiff even though this was an individual claim, because an award of attorney fees in this situation may cause insurers to more carefully consider evidence before denying benefits in future cases. Having determined that Ryan was entitled to an award of attorney fees and costs, the court applied the lodestar method of using an attorney’s reasonable hourly rate and hours expended to conclude that Ryan was entitled to an award of $151,612.50 for attorney fees and $402.00 for costs. Ryan v. Hartford Life & Accident Ins. Co., No. 21-cv-592, 2026 WL 1146274 (W.D. Wis. Apr. 28, 2026).
- Will a court grant summary judgment in favor of an insurer where the insurer terminated LTD benefits even though the Social Security Administration had awarded benefits to the insured? Yes, where the insurer demonstrates that it has discretion in interpreting the terms of the plan and where the insurer’s decision is reasoned and supported by substantial evidence. Mary Sargent stopped working her job as a Senior Director of New Business Development after a non-work-related shoulder injury led to significant pain, fatigue and cognitive limitations. She applied for and received STD benefits and subsequently LTD benefits for twenty-four months. The insurer reviewed Sargent’s status when her eligibility standard changed to being unable to “perform the duties of any gainful employment.” After reviewing doctors’ records and consultant reports, the insurer determined that Sargent was no longer eligible and terminated her benefits. After an internal appeal was denied, Sargent filed an action in federal court, and on consideration of cross-motions for summary judgment the court decided the case in favor of the insurer. The court observed that the plan unambiguously gave discretion to the insurer to interpret the terms of the plan, and therefore applied the arbitrary, capricious or abuse of discretion standard of review. The court acknowledged the insurer’s structural conflict of interest, but determined that Sargent failed to establish that it played any role in evaluating her eligibility for benefits. The court also determined that the insurer provided a sufficient explanation of its determination, and that the insurer’s decision to accept the conclusions of its doctors over Sargent’s doctors was supported by the 6,500-page administrative record. The court rejected Sargent’s argument that the insurer’s determination of ineligibility was contradicted by the SSA’s decision to award her benefits, because that SSA determination predated the insurer’s evaluation under the “any gainful employment” standard. Sargent v. Sun Life Ins. Co. of Canada, No. 24-11500, 2026 WL 1506531 (D. Mass. May 29, 2026).
- Will a court grant discovery to a claimant on claims related to an accidental death policy? Yes, limited to obtaining documents that should have been included in the administrative record and to documents related to a claim for statutory damages. Mayor filed a claim for accidental death benefits after her husband was killed while working on a railroad. The plan administrator allegedly failed to provide a copy of the accidental death policy after Mayor requested it, and the claims administrator denied the claim for benefits, citing an exclusion for deaths caused by the voluntary use of illicit drugs. Mayor filed claims in district court both appealing the benefit denial and seeking statutory damages for failing to provide requested policy information. Mayor sought discovery both on her benefit denial claim and her claim for statutory damages. The court noted that review of benefit denial claims is generally limited to review of the administrative record, and denied in large part Mayor’s request for discovery on the benefit claim denial, including denial of discovery related to the insurer’s structural conflict of interest. The court did order the insurer to produce all plan documents, or provide a verified statement that the record contains all plan documents compiled in the course of denying her claim. The court also permitted Mayor’s requested discovery to both the plan administrator and the claims administrator related to the allegation that her request for all plan documents was not fully addressed. The court reasoned that the information was relevant to her claim for statutory damages for failure to make required disclosures, and that while typically only the plan administrator can be subject to statutory damages for failing to provide plan documents, Mayor had raised the issue that the claims administrator may have acted as an agent for the plan administrator for purposes of responding to the request. Mayor v. Metropolitan Life Ins. Co., No. 1:25-cv-00012, 2026 WL 1339911 (D. Utah May 14, 2026).
- Will a court enforce federal pleading standards against pro se litigants in ERISA litigation? Yes, although courts are frequently understanding of missteps made by inexperienced litigants. Branden Driver filed three separate federal complaints related to a workplace injury totaling more than two hundred pages with more than fifty claims against multiple defendants, including ERISA claims against his employer’s insurer. The court reviewed the complaints and identified sixteen instances of what the court believed were generative artificial intelligence (AI) hallucinations. The court issued a Rule 11 show cause order on Driver, and further alerted Driver that his complaints violated Rule 8’s requirement that complaints be a “short and plain statement of the claim showing that the pleader is entitled to relief.” In response to the show cause order Driver admitted that he used AI, stating that he mistakenly believed it functioned like a legal search engine, and promising to not use it for pleadings in the future. Based on that response, the court discharged its Rule 11 show cause order. The court dismissed the pending complaints without prejudice, and permitted Driver to file amended complaints that comply with Rules 8 and 11. The court provided Driver with the court’s complaint form, and limited any amended complaints from Driver to the space provided on the form plus no more than five additional, double-spaced pages. Driver v. Super Steel LLC, No. 25-cv-903, 2026 WL 1506596 (E.D. Wisc. May 29, 2026).
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