UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

MILLIE COTHRAN,
Plaintiff-Appellee,

v.
                                                                    No. 99-1238
RELIANCE STANDARD LIFE INSURANCE
COMPANY,
Defendant-Appellant.

Appeal from the United States District Court
for the District of South Carolina, at Greenville.
Henry M. Herlong, Jr., District Judge.
(CA-98-3489-6-20)

Argued: October 28, 1999

Decided: December 3, 1999

Before MURNAGHAN, MOTZ, and KING, Circuit Judges.

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Affirmed by unpublished per curiam opinion.

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COUNSEL

ARGUED: Joshua Bachrach, RAWLE & HENDERSON, L.L.P.,
Philadelphia, Pennsylvania, for Appellant. Robert Edward Hoskins,
FOSTER & FOSTER, L.L.P., Greenville, South Carolina, for Appel-
lee. ON BRIEF: Stephen P. Groves, Jr., Duke R. Highfield, Stephen
L. Brown, YOUNG, CLEMENT, RIVERS & TISDALE, L.L.P.,
Charleston, South Carolina, for Appellant.

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Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

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OPINION

PER CURIAM:

Pursuant to § 502(a)(1) of the Employee Retirement Income Secur-
ity Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001 - 1461, Millie Cothran
sued the insurer and administrator of her former employer's group
insurance policy, Reliance Standard Life Insurance Company
("Reliance Standard"), after Reliance Standard terminated her receipt
of long-term disability payments. The district court concluded as a
matter of law that Reliance Standard improperly terminated Cothran's
benefits, and granted summary judgment in favor of Cothran. Reli-
ance Standard now appeals the district court's ruling. Finding no
reversible error, we affirm.

I.

Prior to 1996, Cothran was employed as a programmer/analyst for
Davis Electrical Constructors, Inc., and was insured through her
employer's long-term disability policy (the "Policy") with Reliance
Standard. In January 1996, she submitted a claim for long-term dis-
ability benefits, listing both physical and psychological conditions
that barred her from working. Reliance Standard approved her disabil-
ity claim in May 1996, and it began paying benefits to Cothran. Reli-
ance Standard's correspondence approving Cothran's disability claim
placed no limitation on the benefits coverage duration, nor did it
attempt to narrow the bases that support Cothran's claim.

In 1997, Reliance Standard sought and received more documenta-
tion from Cothran and her doctors. Those documents demonstrated
Cothran's increased impairment, including additional physical prob-
lems as well as the physical and psychological conditions identified
in 1996. Reliance Standard's 1997 correspondence still did not men-
tion any limitations of the benefits coverage Cothran was receiving.
Also in 1997, Cothran applied for Social Security disability benefits.

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In December 1997, an administrative law judge reached a decision
"fully favorable" with Cothran's claim, and awarded disability bene-
fits based on his findings of both physical and psychological condi-
tions amounting to "severe impairments" that"continued through at
least the date of this decision."

In January 1998, Reliance Standard notified Cothran that her bene-
fits were being terminated. For the first time, Reliance Standard
informed Cothran that it considered her impairments as "mental or
nervous disorders." Under the terms of the Policy, if disability is
physical, the long-term disability benefits extend for the duration of
the disability, or until the insured reaches age sixty-five. By contrast,
for disabilities that are "due to mental or nervous disorders," the Pol-
icy provides benefits for no more than twenty-four months. Cothran
appealed to Reliance Standard, seeking to alter its termination deci-
sion, and she provided additional medical records in support of her
claim. When no relief was forthcoming, Cothran initiated this lawsuit
in the district court.

In its review of Cothran's claim, the district court applied a "modi-
fied abuse of discretion" standard of review since Reliance Standard,
as Plan Administrator, was subject to a conflict of interest in its han-
dling of Cothran's claim. This conflict existed because Reliance Stan-
dard acted in a fiduciary capacity as Plan Administrator, and was also
the insurer whose financial interest was at stake under the Policy.1
See, e.g., Bernstein v. CapitalCare, Inc., 70 F.3d 783, 788 (4th Cir.
1995); Doe v. Group Hosp. & Med. Servs., 3 F.3d 80, 86-87 (4th Cir.
1993). Thus, the district court's review of Reliance Standard's deci-
sion properly considered Reliance Standard's conflict of interest as a
factor in analyzing the reasonableness of its decision to terminate Ms.
Cothran's benefits. See Bernstein, 70 F.3d at 788.
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1 On appeal, Reliance Standard argues that the "modified abuse of dis-
cretion" standard does not apply, because, unlike in Doe, no "substantial"
conflict of interest existed here. See Doe, supra Part I. Reliance Stan-
dard's conflict is, however, identical to that found by the Doe court to
exist in that case, and the Doe court's reasoning applies with equal force
here. See id.

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The district court's review was limited to the administrative record,
which included the evidence before the Plan Administrator at the time
of its challenged decision. See Bernstein, 70 F.3d at 788. On the basis
of the administrative record, the parties submitted cross-motions for
summary judgment to the district court. The district court concluded,
as a matter of law, that the Policy's limitation based on its undefined
term "mental or nervous disorders" was ambiguous as applied to
Cothran's condition. Having found this ambiguity to exist, the court
construed the terms of the Policy against its drafter, Reliance Standard.2

Reliance Standard appeals the district court's resulting order grant-
ing Cothran's summary judgment motion and denying Reliance Stan-
dard's cross-motion. In considering an award of summary judgment
regarding ERISA health benefits, we review the district court's deci-
sion de novo, employing the same standards applied by the court
below. See Bernstein, 70 F.3d at 787 (citation omitted).

II.

We have carefully considered the briefs and oral arguments on
behalf of the parties, and we have examined the administrative record
pertinent to their positions. We find no reversible error, and we are
content to adopt the opinion of the district court and affirm on its rea-
soning. See Cothran v. Reliance Standard Life Ins., CA No. 6:98-
3489-20 (D.S.C. Feb. 9, 1999).

AFFIRMED
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2 Reliance Standard contends that substantial evidence supported its
decision, under its view of the applicable legal standard, and thus that the
district court's decision to the contrary was error. The administrative
record abundantly demonstrates Cothran's disabling physical conditions,
however, and the district court did not err in applying the proper legal
standard to the record in this case.




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