Improving ERISA Law for Plaintiffs

In my memorandum, I explained that Prudential had hired a representative to help my client obtain Social Security disability benefits. But when Social Security made its award, the carrier turned around and rejected my client’s LTD claim. It refused to be bound by Social Security’s finding of disability.

In fact, many ERISA insurers make Long-Term Disability (LTD) claimants file for Social Security disability, because their plans reduce benefits payments by the amount of Social Security obtained. This saves them money. And then, they refuse to be bound by Social Security’s finding and reject LTD claims. Insurance companies do this because they can. Under the law, an ERISA decision-maker is not automatically bound by what Social Security says.

In my brief, I explained that as the ERISA decision-maker, the court was not free to ignore the decision of the Social Security Administration. The fact that a person has been found disabled by SSA is a factor a court should consider, in the context of the record as a whole. The case law supported this position.

Citing several more cases as precedent, my brief explained that as a guiding principle, the doctrine of “judicial estoppel” applies when a litigant is “playing fast and loose with the courts and when intentional self-contradiction is being used as a means of obtaining unfair advantage.” This is precisely what had happened with my client. The court understood, and held that the insurer’s actions were an abuse of discretion. A Ruling and Recommendation in favor of my client followed. The case then quickly resolved before the District Court took further action.

But winning wasn’t enough; I needed to educate the bar. I published an article in my firm’s newsletter about the practices of ERISA insurers and about developments in applicable law. The article was distributed to members of the plaintiff’s ERISA bar nationwide and a more in-depth article was then published in the Tennessee Bar Association newsletter.