Medical Reports, Complaints Support Total Disability Finding


NEW YORK – Under a de novo review, a federal judge on Feb. 13 ruled that an ERISA-governed disability insurer that terminated benefits to a claimant with multiple medical problems acted arbitrarily. The judge found that the record contained substantial evidence of total disability (Francis E. Lijoi v. Continental Casualty Co., et al., No. 01-CV04536, E.D.N.Y.; 2006 U.S. Dist. LEXIS 5344).

Francis Lijoi worked as director of technical services for Forbes Inc. He was insured under the company’s group disability plan. The plan was administered by Continental Casualty Co. The plan provided own occupation coverage for the first 36 months and any occupation coverage beyond that period.

Dizziness, Fatigue
In 1996, Lijoi filed a claim for long-term disability benefits after experiencing episodes of dizziness and fatigue. He lost consciousness while driving in September 1996, losing control of his car and hitting a metal pillar. He was treated for syncope, possible herniated lumbar, cervical disc with radiculopathy and post-concussion syndrome.

In October 1996, Lijoi’s cardiologist inserted a pacemaker to counteract an irregularly slow heartbeat, which could have contributed to his fainting spells. Lijoi continued to complain of sleeplessness, back, neck and chest pain, headaches, depression, dizziness and other symptoms.

His primary physician, Dr. William Head, certified Lijoi was totally disabled and that no job accommodation would allow him to return to work. In 1998, Lijoi was diagnosed with hepatitis C and chronic fatigue syndrome.

Examination, FCE
Continental initially approved Lijoi’s claim for benefits, but in 1998, the insurer began to question whether Lijoi was still disabled under the plan. Continental had Lijoi examined by its neurologist, a Dr. Neophytides. Neophytides found no evidence of neurological dysfunction which would account for Lijoi’s symptoms. Neophytides found no significant degree of disability that would prevent Lijoi from returning to work.

Lijoi submitted a functional capacity evaluation (FCE) he had done at the advice of his attorney. The FCE found no occupations which Lijoi could perform. Continental conducted its own FCE and had the results reviewed by a Continental analyst. The analyst concluded the conditions “diagnosed do not appear to be supported with objective information.”

Continental terminated Lijoi’s benefits. Lijoi appealed, submitting recent medical examinations and information regarding his medical examinations and information regarding his recent diagnosis of hepatitis C and CFS. Continental upheld its termination of benefits on appeal and Lijoi sued, seeking benefits under the Employee Retirement Income Security Act. Both parties moved for summary judgment.

De Novo Review
U.S. Judge I. Leo Glassner of the Eastern District of New York conducted a de novo review of Continental’s decision to terminate benefits, finding that the plan did not clearly confer discretion to the administrator. The judge also included in his review additional evidence that was not before the administrator at the time of the denial, finding that Lijoi has shown good cause to admit such evidence.

Lijoi argued that such evidence should be admitted, citing a conflict of interest by Continental as the claims reviewer and payor of benefits, and that Continental had insufficient written procedures for its claims handling and appeal process that contributed too an arbitrary denial of benefits.

The additional evidence submitted included additional records from Head, medical records related to Lijoi’s hepatitis C, Lijoi’s testimony regarding his medical history and claims process and findings by an administrative law judge as to Lijoi’s Social Security disability claim.

The judge rejected Continental’s claim that Lijoi’s records did not provide enough objective medical evidence that he is totally disabled.

“The plan does not specify the weight or extent of the objective medical findings required to award benefits, and Continental’s effort so minimize or discredit the findings provided by Lijoi amount to rewriting the terms of the plan,” the judge held.

The judge held that Continental provided no basis for why the findings of its own reviewers who saw Lijoi only once were considered reliable evidence while the reports of Lijoi’s physicians who treated him on a regular basis were determined unreliable.

“Comparing Dr. Head’s reports of his clinical examinations of Lijoi to Dr. Neophytides’ report admits of no principled distinction between the physicians’ methods, only in their opposing conclusions. Dr. Head’s findings, however, are corroborated by the host of other practitioners who saw Lijoi during 1996 and 1997, and have seen him since, deeming him totally disabled,” the judge held.

“He said it could not discredit the findings of multiple doctors as Continental did, especially when “the opposing medical opinion is based on a single evaluation of a doctor hired by an insurance company that was operating with a demonstrable conflict of interest.”

Further, the judge held that Continental failed to properly address Lijoi’s diagnosis of hepatitis C and CFS in 1998, a diagnosis that explained many of Lijoi’s earlier symptoms.

“Continental has provided no evidence to controvert or discredit findings that were made in late 1998 or 1999,” he ruled.

Additionally, the judge said Continental erred by not giving more weight to Lijoi’s subjective complaints of pain, citing Connors v. Conn. Gen. Life Ins. Co. (272 F.3d 127 136 [2nd Cir. 2001]).

“The extensive record of examinations, diagnoses, and treatment of Lijoi by a battery of physicians should have, at the very least, caused Continental to entertain the probability of credence to his subjective complaints in December 1998. It appears to be the case, however, that Continental callously concluded that his subjective complaints were unsubstantiated, even in the face of the increasingly extensive record, and that his complaints were feigned. That capricious and arbitrary determination was belied not only by the extensive record, but has now been confirmed by the explicit credibility determination [made by an administrative law judge], the judge held.

He granted Lijoi summary judgment and awarded benefits during the own occupation and any occupation coverage periods. The judge also awarded Lijoi attorney fees.

Lijoi is represented by Evan S. Schwartz, William J. O’Mahony and Michail Z. Hack of Schwartz, Conroy & Hack formerly known as Quadrino & Schwartz in Garden City, N.Y. Continental is represented by Patricia Marie McIntire of McElroy, Deutsch, Mulvaney & Carpenter in Morristown, N.J.


Evan S. Schwartz
Founder of Schwartz, Conroy & Hack