Client Awarded $30k in ERISA Long-term Disability Denial Claim

Client Awarded $30k in ERISA Long-term Disability Denial Claim

Michael Horrow and the team at Donahue & Horrow recently won a second case on behalf of their client in his, seemingly never-ending, fight with a large insurance company for the long-term disability benefits he is owed under an ERISA plan.

After working for almost 40 years, our client first became disabled in May 2018, due to the back pain, the source of which was confirmed by examinations by multiple doctors, as well as a lumbar MRI. Because the pain prevented him from continuing to work, our client filed an ERISA claim with a large insurance company, seeking long-term disability benefits under an employee welfare benefit plan issued by his employer, Scientific Games Corporation. 

This insurance company initially approved his disability claim, but eight months after undergoing painful back surgery, the insurance company suddenly reversed its decision, denying his claim under a long-term disability plan governed by ERISA. While none of our client’s doctors believed he could return to work, a physician paid by the insurance company said that he could start working again, even though that doctor never examined our client.  

Following an ERISA-mandated appeal, during which the insurance company refused to reverse its decision, Donahue & Horrow filed a complaint in the Sacramento Federal Courthouse in April 2020, during the height of the COVID pandemic. In that lawsuit, when the parties were preparing to submit ERISA trial briefs to the Court, the insurance company suddenly reversed its claim decision, agreeing to pay our client all of the benefits he was owed through that date. The insurance company was also ordered by the court to pay the attorneys’ fees and costs our client was forced to incur in bringing the lawsuit, which allowed him to receive every dollar that he should have received from the start of his claim.

One downside of the large insurance company’s decision to place him back on his long-term disability claim was that he still had to justify his disability to the company on a monthly basis. When reviewing his ongoing claim, the insurance company denied his claim after 24 months, alleging that a change in the definition of disability meant that the company was no longer liable for the long-term disability benefits that were promised. Specifically, the insurance company stated that our client failed to provide “objective evidence” of certain conditions as required to receive benefits after 24 months. We disagreed with the insurance company’s determination, so Donahue & Horrow helped him with the appeal. Unfortunately, the insurance company yet again refused to reverse its long-term disability denial decision.

Accordingly, Donahue & Horrow filed another complaint in the Sacramento Federal Courthouse, again arguing that the insurance company’s denial decision was improper and a violation of both the insurance policy and ERISA. In the trial briefing, Donahue & Horrow argued that the language of the policy was improperly confusing and that, despite this, our client met the definition of disability because he provided “objective evidence” of “myelopathies” and “spinal cord damage” such that he was entitled to benefits. After considering the arguments of the parties and all of the evidence, Chief United States District Judge Kimberly J. Mueller agreed with the arguments we made. Judge Mueller agreed that the language in the policy requiring “objective evidence” of “myelopathies,” “spinal cord damage” and other conditions was improperly confusing and ambiguous.  The court also determined that our client did provide the required medical evidence to support his entitlement to benefits after 24 months and that the insurance company improperly minimized the evidence supporting disability.

As a result of the trial victory, our client will receive all of the ERISA long-term disability benefits he was due under the policy, as the insurance company will likely again be required to pay the attorneys’ fees and costs associated with the litigation.

If you believe your ERISA disability insurance, life insurance, long-term care or AD&D insurance claim was improperly denied by your insurance company, call Donahue & Horrow LLP at (877) 664-5407 for a free consultation. We are ready to help you get the benefits you deserve.