I filed suit today against Standard Insurance Company on behalf of a former firefighter whose LTD benefits were recently terminated. After paying LTD benefits for two years, the insurer has advised my client that they are cutting off the benefits. As with most of these cases, if I win, the insurance company must pay all or my fees and costs, and if I lose, I'll work for free.
In Holmstrom v. Metropolitan Life Insurance Company, 2009 WL 901127 (N.D. Ill. March 31, 2009), Holmstrom sued Metropolitan for terminating her long term disability payments. Metropolitan counterclaimed seeking reimbursement from Holmstrom for an overpayment of LTD benefits which occurred when Holmstrom received a payment for back benefits from social security disability. (The Metropolitan plan contained a provision that reduced the monthly LTD payments by the amount received from social security disability).
The only way Metropolitan would be allowed to proceed on its counterclaim is if its claim was equitable in nature. If Metropolitan's claim was not equitable in nature, then the court would not have jurisdiction. In a lengthy analysis, and based on the Supreme Court's determination in Sereboff v. Mid Atlantic Medical Services, Inc., 547 U.S. 356 (2006), the Illinois district court determined that Metropolitan's claim was equitable in nature and granted summary judgment for Metropolitan on its counterclaim.
Holmstrom also argued, unsuccessfully, that Metropolitan did not assist her in obtaining the social security disability benefits, and therefore, Metropolitan waived its right to claim the overpayment. While recognizing the potential viability of such a claim, the court stated that Holmstrom could not rely on such an argument where the LTD plan did not require the administrator to assist the beneficiary in seeking social security disability benefits.
When evaluating a request by an LTD carrier for reimbursement, a careful analysis of whether the claim is actually "equitable" is foundational. This case, along with Sereboff are essential starting points in that analysis.
We recently filed suit against Hartford Life and Accident Insurance Company for denying our client's claim for Long Term Disability benefits.
Our client was a salesman working for a chemical company. He suffered from intractable pain, and applied for and received short term disability benefits. He then received long term disability benefits for 24 months. Then, suddenly, his disability benefits were terminated based on Hartford's finding that even though he was disabled from his own occupation, he was not disabled from all occupations.
Contrary to Hartford's opinion, the medical evidence supports the fact that our client is unable to work at any occupation.
Our client's Long Term Disability claim was denied by Hartford. At the time he became disabled, our client worked as a cruise ship engineer working for Disney Worldwide Services, Inc. He suffered from a severe stomach condition and was unable to work. Litigation continues.
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