     Case: 12-60683   Document: 00512384125     Page: 1   Date Filed: 09/24/2013




        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT  United States Court of Appeals
                                                 Fifth Circuit

                                                                 FILED
                                                             September 24, 2013

                                 No. 12-60683                   Lyle W. Cayce
                                                                     Clerk

JOSH PORTER, Individually and on behalf of all wrongful death
beneficiaries of Elizabeth A. Porter,

                                           Plaintiff - Appellee Cross-Appellant
v.

LOWE’S COMPANIES, INCORPORATED’S BUSINESS TRAVEL
ACCIDENT INSURANCE PLAN; GERBER LIFE INSURANCE COMPANY,

                                           Defendants - Appellants Cross-
                                           Appellees



                Appeals from the United States District Court
                   for the Southern District of Mississippi


Before DAVIS, JONES, and BENAVIDES, Circuit Judges.
W. EUGENE DAVIS, Circuit Judge:
      Plaintiff Josh Porter brought suit against Defendants Lowe’s Companies,
Incorporated’s Business Travel Accident Insurance Plan, and Gerber Life
Insurance Company to challenge the Plan Administrator’s denial of benefits
under an ERISA Plan. The district court granted relief from that denial and
awarded benefits, concluding that the Plan Administrator had abused its
discretion. Because we find the Plan Administrator did not abuse its discretion,
we reverse and render judgment in favor of the defendants.
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                                       No. 12-60683

                                              I.
        This is a suit to recover benefits under a plan governed by the
Employment Retirement Income Security Act of 1974 (“ERISA”).1 Elizabeth
Porter (“Elizabeth”) died while employed as a manager at Lowe’s, Inc. (“Lowe’s”).
As an employee of Lowe’s, Elizabeth was covered under the Business Travel
Accident Insurance Plan (“the Plan”). The Plan is established and maintained
by Lowe’s and regulated under ERISA. Gerber Life Insurance Company
(“Gerber”) underwrote and insured the Plan.                 A.C. Newman & Company
Insurance Correspondents, Inc. (“Newman”), an independent plan administrator,
administered the Plan.2            The Plan gave the Administrator the power “to
interpret the terms of the Plan and to determine the eligibility for Plan benefits.”
Josh Porter (“Mr. Porter”) is the surviving spouse of Elizabeth and beneficiary
of the Plan.
        Elizabeth was an Administrative Manager at Lowe’s. On February 24,
2008, she closed the store and was returning home when she received a call that
the security alarm at Lowe’s had been triggered. Elizabeth turned around to
return to the store. She was one of three employees on call to respond to the
alarm. En route to the store, her car was hit head-on by an automobile in the
wrong lane of traffic. Both Elizabeth and her unborn child died.
        The Plan provides benefits for a death that occurred on a bona fide
business trip in furtherance of Lowe’s business. The Plan provides in pertinent
part:




        1
            29 U.S.C. § 1001 et seq.

        2
           Though originally named as a defendant, Newman has been dismissed based on a
stipulation that Gerber would be liable for any damages resulting from a judgment for the
Plaintiff. Thus the parties in this appeal are Gerber and the Plan (collectively “Defendants”).

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                                 No. 12-60683

      SECTION V - COVERAGE PROVISION
      Description of Hazards
      Coverage will apply to an Injury sustained by an Insured Person
      when on Business for the Policyholder during any bonafide trip.

      Coverage for such trip begins on the later of when an Insured
      Person leaves his or her place of: (a) residence; or (b) regular
      employment; for the purpose of going on such trip.

      Coverage for such trip terminates on the earlier of when an Insured
      Person returns to his or her place of: (a) residence; or (b) regular
      employment; following such trip . . . .
           ....

      SECTION II - DEFINITIONS
      When On Business For the Policyholder
      Furthering the business of the Policyholder. This does not include
      an Injury sustained during travel to and from work, leave of
      absence, vacation or personal deviation.
           ....
      Bonafide Trip
      A trip made in good faith and authorized by the Policyholder for the
      purpose of furthering the business of the Policyholder.

(emphasis added).
      As emphasized above, the Plan explicitly excludes from coverage injuries
sustained “during travel to and from work.” Thus the question of coverage turns
on whether Elizabeth’s accident occurred while she was on a “bonafide trip”—in
which case Mr. Porter could recover benefits— or if her accident simply occurred
“during travel to and from work”—in which case Mr. Porter could not recover
benefits.
      On May 14, 2008, Mr. Porter made a claim for benefits under the Plan.
Newman investigated the claim and wrote to Lowe’s to inquire into Elizabeth’s
employment schedule, her normal job duties, and whether she received a


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                                      No. 12-60683

workers’ compensation award. Lowe’s responded that her workers’ compensation
claim was “accepted as compensable based on [the] fact she was on a special
errand while returning to the store to shut off the alarm.” (emphasis added).
Newman also wrote to Lowe’s: “As Mrs. Porter’s name was on file with the alarm
company as an employee responsible to reply to an alarm, please confirm that
this was part of her regular job duties.” Lowe’s “confirm[ed] that responding to
alarms was part of Elizabeth Porter’s regular job duties.” While the job
description of Elizabeth’s duties does not specifically list responding to security
alarm triggers, it does state that her job “requires morning, afternoon and
evening availability any day of the week.”
       On October 22, 2008, Newman issued an opinion denying benefits which
stated that “[a]t the time of the motor vehicle crash, Mrs. Porter was traveling
to work to perform her regular job duties, thus, she was not on Business for the
Policyholder during any bonafide trip at the time of her motor vehicle crash.” Mr.
Porter appealed the denial and Newman again denied benefits.
       Mr. Porter appealed to the district court. The parties agreed that there
was no need for discovery and filed cross-motions for summary judgment. The
district court found that Newman’s conclusion that Elizabeth was not on a bona
fide business trip was legally incorrect and an abuse of discretion.
       The district court entered judgment for Mr. Porter in the sum of
$181,830.37, plus pre-judgment interest, but later denied Mr. Porter’s request
for attorneys’ fees because there was no “bad faith” in denying the claim.
                                            II.
       “We review a district court’s grant of summary judgment in ERISA cases
de novo, applying the same standard as the district court.”3 Summary judgment


       3
         Lafleur v. La. H’lth Serv. & Indem. Co., 563 F.3d 148, 153 (5th Cir. 2009) (internal
citations omitted).


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                                          No. 12-60683

is appropriate when there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.4
       When, as here, the ERISA plan grants the administrator the discretion to
interpret the meaning of the plan, this court will reverse an administrator’s
decision only for an abuse of discretion.5 The fact that the evidence is disputable
will not invalidate the decision; the evidence “need only assure that the
administrator’s           decision     fall    somewhere         on    the    continuum        of
reasonableness—even if on the low end.”6 Stated differently, “If the plan
fiduciary’s decision is supported by substantial evidence and is not arbitrary and
capricious, it must prevail.”7 Applying an abuse of discretion review of an
administrator’s interpretation of the plan consists of a two-step process: first
inquiring whether the plan administrator’s decision was “legally correct,”8 and,
if it is not, secondly inquiring whether the administrator abused his discretion.9


       4
           Fed. R. Civ. P. 56(a).
       5
           Crowell v. Shell Oil Co., 541 F.3d 295, 312 (5th Cir. 2008).
       6
         Corry v. Liberty Life Assur. Co. of Boston, 499 F.3d 389, 398 (5th Cir. 2007) (internal
citations omitted).
       7
           Ellis v. Liberty Life Assur. Co. of Boston, 394 F.3d 262, 273 (5th Cir. 2004).
       8
        To determine if the administrator’s decision is legally correct, the court considers: “(1)
whether the administrator has given the plan a uniform construction, (2) whether the
interpretation is consistent with a fair reading of the plan, and (3) any unanticipated costs
resulting from different interpretations of the plan.” Crowell, 541 F.3d at 312 (quoting
Threadgill v. Prudential Secs. Grp., 145 F.3d 286, 292-93 (5th Cir. 1998)). The factor most
worth considering is “whether the administrator’s interpretation is consistent with a fair
reading of the plan.” Id. at 313 (quoting Gosselink v. AT&T, Inc., 272 F.3d 722,727 (5th Cir.
2001)).
       9
          Crowell, 541 F.3d at 312. If the court determines the administrator’s interpretation
is not legally correct, it can proceed to the second step and assesses whether the administrator
abused its discretion, considering: “(1) the internal consistency of the plan under the
administrator’s interpretation, (2) any relevant regulations formulated by the appropriate
administrative agencies, and (3) the factual background of the determination and any
inferences of lack of good faith.” Gosselink, 272 F.3d at 726.

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                                          No. 12-60683

If the administrator both administers and insures the Plan, such a conflict of
interest is weighed as a “factor in determining whether there is an abuse of
discretion.”10
       Notably, this court can “bypass, without deciding, [the issue of] whether
the Plan Administrator’s denial was legally correct, reviewing only whether the
Plan Administrator abused its discretion in denying the claim” if that can be
“more readily determine[d].”11
                                               III.
       The district court found that because the Plan reserved to the
Administrator the discretion in both plan interpretation and eligibility
determination, the proper standard of review is the arbitrary and capricious
standard. And the district court found that there was no conflict of interest, as
the Administrator was not also insuring the Plan. Neither party challenges these
conclusions on appeal.
       The district court held that the determination by Newman, the Plan
Administrator, to deny benefits was not legally correct because the “only fair
construction to put on the phrase ‘travel to and from work’ is travel in the
ordinary daily commute” and found that this is the “commonly ascribed to this
type of exclusion.” After concluding that Newman’s decision was not legally
correct, the district court went on to conclude that the decision to deny benefits
“was not supported by the evidence” and was an abuse of discretion.
       Defendants argue that the district court essentially rewrote the terms of
the Plan to cover Elizabeth’s normal commute as a “bonafide business trip.”
They contend that Newman interpreted the phrase “travel to and from work” in



       10
            Crowell, 541 F.3d at 312. (quoting Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 114
(2008)).
       11
            Holland v. Int’l Paper Co. v. Ret. Plan, 576 F.3d 240, 246 n.2 (5th Cir. 2009).

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                                         No. 12-60683

its common sense meaning as dictated by this court’s ERISA jurisprudence.12
Further, when a plan administrator is given broad discretion to interpret a plan,
it has the power to resolve ambiguities.13 And as emphasized above, the question
is not whether the interpretation of the Plan “is most persuasive, but whether
the plan administrator’s interpretation is unreasonable.”14
       Mr. Porter cites, and the district court relied upon, several cases with
similar policy provisions as standing for the principle that accidents which take
place during the ordinary commute are excluded from coverage, but business-
related deviations beyond the normal commute—whether spatially or
temporally—are covered.15

       12
            Tucker v. Shreveport Transit Mgmt. Inc., 226 F.3d 394, 398 (5th Cir. 2000).
       13
            See High v. E-Sys. Inc., 459 F.3d 573, 579 (5th Cir. 2006). Mr. Porter argues
throughout that ambiguities must be construed in favor of the insured. While typically true,
this is not the case when a plan administrator is given the discretion to interpret the terms
of the plan.
       Only when the plan terms remain ambiguous after applying ordinary principles
       of contract interpretation does this court apply the rule of contra proferentum
       and construe the terms strictly in favor of the insured. [Plaintiff] High’s case,
       however, does not warrant the application of this rule; the language of the
       E-Systems Plan is [not] ambiguous and, as E-Systems suggests, by giving
       MetLife [the Plan Administrator] complete discretion to interpret the plans, if
       there had been an ambiguity, MetLife was empowered to resolve it, exercising
       “interpretive discretion.”
High, 459 F.3d at 578-79 (citations omitted); see also Winters v. Costco Wholesale Corp., 49
F.3d 550, 554 (9th Cir. 1995) (“We hold that the rule of contra proferentem is not applicable
to self-funded ERISA plans that bestow explicit discretionary authority upon an administrator
to determine eligibility for benefits or to construe the terms of the plan.”).
       14
            Winters, 49 F.3d at 553 (internal quotation marks omitted).
       15
           See 10 COUCH ON INS. § 143:13 (“Accidents that take place during an insured
employee’s everyday commute to and from the place of employment are generally explicitly
excluded from coverage under business travel insurance policies in terms of ‘commutation
travel,’ ‘everyday travel,’ ‘day-to-day travel,’ or similar phrasings intended to identify travel
which is not, in essence, anything other than the insured’s necessary and repeated efforts to
get to and from work. . . . These provisions are generally construed by the judiciary to mean
that there is no coverage during the regular travel between home and work for the sole
purpose of reaching the intended destination.”).

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                                            No. 12-60683

       Most notably, the district court cited Duffer v. American Home Assurance
Co.16 There, the insured was killed while en route to pick up a co-worker to
return to the office after hours in order to ascertain the cause of an inventory
shortage.17 The policy at issue, a non-ERISA group travel insurance policy,
excluded coverage for “every day travel to and from work.” This court concluded
that had “the policy intended to exclude all travel to and from work or all travel
between home and place of employment it could have done so simply.”18
However, the “modifying words ‘every day’ before the phrase ‘travel to and from
work’ c[ould] not be disregarded as meaningless.”19 Thus, this court held that as
a result of the modifying words “every day,” the policy only excluded travel on
days and at hours normally related to his regular hours of employment;
consequently, the insured was covered under the policy.20
       The district court cited Duffer in favor of finding coverage for Mr. Porter.
Yet as noted above, the policy in Duffer included the limiting provision “every
day,” and the Plan at issue here has no such language. Additionally, in Duffer
this court acknowledged the importance of that limiting phrase and suggested
that an employer could “exclude all travel to and from work or all travel between


       16
            512 F.2d 793 (5th Cir. 1975).
       17
            Id. at 797.
       18
            Id.
       19
            Id.
       20
          The other cases cited by the district court contained similar language, i.e., included
“day to day” or “everyday.” See, e.g., McNeily v. Lumbermens Mut. Cas. Co., 647 F. Supp. 1567,
1569-70 (E.D. Mich. 1986) (“day-to-day travel to and from work” exclusion did not apply to
employee who was required to come to work for an open house on Saturday); Ligo v. Cont’l
Cas. Co., 338 F. Supp. 519, 524 (W.D. Pa. 1972) (“everyday travel to and from work” exclusion
did not apply to employee required to deviate from his regular commute to pick up employer’s
mail); Morningstar v. Ins. Co. of N. Am., 295 F. Supp. 1342, 1346 (S.D.N.Y. 1969)
(“commutation travel” exclusion did not apply to employee who deviated from normal
commuting route to discuss business at another company).

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                                       No. 12-60683

home and place of employment” if it so intended.21 Furthermore, neither Duffer
nor any of the cases cited by the district court involved an ERISA plan in which
the plan administrator was given the discretion to interpret the terms of the
plan.
        As discussed above, in our review of the Plan Administrator’s decision this
court can bypass, without deciding, whether the determination was legally
correct, and move directly to whether the determination was an abuse of
discretion.22 Taking that course here, we conclude, based on the record and
arguments made by the parties, that the Plan Administrator did not abuse its
discretion in denying coverage. The Plan Administrator was not operating under
a conflict of interest and was vested with the power to interpret the terms of the
Plan. All of the cases cited by the district court and Mr. Porter contained plans
with limiting language, i.e., “commutation,” “day-to- day,” or “everyday.” The
Policy here contains no such language. And Elizabeth’s job description at least
required “morning, afternoon and evening availability,” such that Elizabeth’s
trip arguably was not a temporal or spatial deviation from her normal commute.
While Mr. Porter emphasizes that Elizabeth qualified for a workers’
compensation award because she was on a “special errand” for her employer,
that is a state law concept which the terms of the Plan do not reference, and
coverage under worker’s compensation does not necessarily mean that coverage
under the ERISA Plan follows. For these reasons, we find that the Plan
Administrator’s denial of coverage was not an abuse of discretion.23

        21
             Id.
        22
         See Holland, 576 F.3d at 246 n.2. See also Duhon v. Texaco, Inc., 15 F.3d 1302, 1307
n.3 (5th Cir. 1994) (“However, the reviewing court is not rigidly confined to this two-step
analysis in every case.”).
        23
         Consequently, we need not address Defendants’ argument that a business trip had
not commenced as required by the Plan because “Coverage for such a trip begins on the later
of when an Insured Person leaves his or her place of: (a) residence; or (b) regular employment;

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                                       No. 12-60683

                                             IV.
       Accordingly, we REVERSE the district court and RENDER judgment in
favor of defendants.
REVERSED.
RENDERED.




for the purpose of going on such trip.” And because we conclude that the Plan Administrator
did not abuse its discretion in denying coverage under the Plan, we need not address
Defendants’ argument that the district court erred in calculating prejudgment interest, or Mr.
Porter’s argument on cross-appeal that the district court erred in declining to award attorneys’
fees.

                                              10
