In this case, Shenita Sapp (“Sapp”) sought to recover long term disability benefits that were denied by the administrator of her plan. Sapp argued that the claims administrator, Sedgwick Claims Management Services (“Sedgwick”) was acting in an arbitrary and capricious manner when it made its decision. However, the Administrator of the Plan, AT&T Services, Inc. (“AT&T”) argued that Sapp had been exaggerating her symptoms during a medical examination, resulting in a reason for it to deny her benefits.
The definition of “disabled” per the plan language is “a continuous physical or mental illness or injury, whether work related or non-work related, that renders you unable to perform an[y] type of work other than work for which the rate of pay is less than 50 percent of your pay.” While Sedgwick reviews any claims and appeals of the plan and analyzes its language and applicability, AT&T funds the benefits from a trust.
Sapp’s symptoms began before her employment by AT&T. She previously served in the United States Army National Guard, where she was sexually harassed and assaulted by her supervisor. This caused her to stay in the hospital for several months before she was medically discharged by the National Guard. Later, in 2005, Sapp started visiting a psychiatrist because of symptoms of post-traumatic stress disorder.
In 2011, Sapp had experienced further mental health deterioration because her father passed away. During October, she spent two weeks in a hospital for treatment related to her mental health. In November, she met with Karen Sack, a licensed social worker at Kaiser Permanente. The result of this meeting was a finding that Sapp had post-traumatic stress disorder and moderate Bipolar 1 disorder. Following all of this, Sapp met with Dr. Corey Arranz and a Dr. Rochon. They subsequently diagnosed her with depression, post-traumatic stress disorder, and Bipolar 1 disorder. She was then prescribed to Prazosin, Latuda, Klonopin, and Topamax. Because of her diagnoses, Sedgwick decided to approve Sapp for benefits in August of 2012.
By 2016, AT&T decided that it needed to evaluate Sapp’s work capacity. As such, it decided to hire an independent medical evaluator, Dr. Nick DeFilippis. He reviewed Sapp’s file and conducted tests on her. While the file indicated that she had been indeed diagnosed with PTSD and bipolar disorder, he noted improvement on two reports. One report indicated that Sapp “was doing better and her mood was stable.” The second report stated that her mood was improved and that she was not having as many nightmares, however her mood stabilizer “caused her not to be able to do things.”
In regard to the tests that he conducted, Dr. DeFilippis explained that Sapp’s “performance on validity and effort measures were at levels that strongly suggest conscious exaggeration of symptoms.” More specifically, her results showed “very poor effort,” and that “her self-report is likely unreliable.” He supported this assertion by explaining that her IQ score was not matching up with her functionality level. Dr. DeFilippis also opined that he “could not identify any limitations for the examinee based on this evaluation because of the invalidity of test findings. The examinee reports severe limitations in her function, but her self-report is not found to be valid.”
AT&T then pursued a labor market survey, which resulted in a finding of six possible jobs for Sapp with her ability levels. The results of this survey, along with Dr. DeFilippis’ report caused AT&T to then deny the long term disability benefits claim. Sapp then sought to appeal, explaining that she “couldn’t stay alert or complete the assessments” during the independent medical examination. She also stated that she “fell asleep several times and got yelled at for not remembering questions.” Sapp then submitted more medical records.
Sedgwick then hired a psychiatrist, Dr. Michael Rater, and a clinical neuropsychologist, Dr. Dennis Buchholz to examine Sapp’s file. Dr. Rater explained that Sapp’s file did not “support a lack of work capacity” because she “has not had the intensity of services consistent with a lack of work capacity.” Overall, Dr. Rater believed that based on Dr. DeFilippis’s “assessment of exaggeration and unreliability” Sapp was able to work.
Dr. Buccholz then came to a similar conclusion based on Sapp’s IQ test results. Her score of 43 was in a category that typically involved those who are “institutionalized due to a complete inability to carry out simple activities of daily living such as eating.” He also concluded that “problems with fatigue or alertness did not result in below-chance performance on tests.” At this point, Sedgwick denied Sapp’s appeal; she then filed the instant suit against AT&T.
Sapp brought forth four arguments in her suit. Firstly, she argued that Dr. DeFilippis’ report was not reliable and invalid, and that relying on same is arbitrary and capricious. Secondly, Sapp claimed that AT&T should not have relied on Dr. Rater’s review of the report and his discounting of her objections. Thirdly, Sapp believed that her ERISA benefits are supported by her award of social security disability benefits. Fourthly and lastly, Sapp argued that Dr. DeFilippis ignored evidence submitted by her treating physicians.
The court believed that Sedgwick may have reached the wrong decision. More specifically the court noted that Sapp experienced a trauma which affected her mental health status. She then was diagnosed with PTSD, depression, and bipolar disorder by a number of doctors. The court also gave deference to the fact that Sapp had been in receipt of social security disability benefits. In addition, the court decided that Sapp’s independent medical examination was not sufficient to establish that she did not have a disability.
However, even though the court felt that Sedgwick reached the improper decision, it also believed that Sedgwick’s decision was reasonably supported. Particularly, Sedgwick may “credit the opinions of the [its] doctors that reviewed Plaintiff’s medical records over the opinions of Plaintiff’s doctors.” It was further allowed to act within discretion in believe “evidence that conflicts with a treating physician’s evaluation.” Overall, the court ruled that Sedgwick’s decision to deny long term disability benefits was not arbitrary and capricious because the decision was evidenced by reliance on reasonable grounds.
Here is a copy of the decision in PDF: