10-1943-cv
Schnur v. CTC Communications Corp.


                            UNITED STATES COURT OF APPEALS
                                FOR THE SECOND CIRCUIT

                                          SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY
FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN
CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE
EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
“SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY
PARTY NOT REPRESENTED BY COUNSEL.

        At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on
the 14th day of March, two thousand eleven.

PRESENT:         JOHN M. WALKER, JR.,
                 BARRINGTON D. PARKER,
                 DEBRA ANN LIVINGSTON,
                                 Circuit Judges.


SUSAN SCHNUR
          Plaintiff-Appellant,

        -v.-                                                    No. 10-1943-cv

CTC COMMUNICATIONS CORP. GROUP DISABILITY PLAN.,
         Defendant-Third-Party Plaintiff-Appellee,

CONTINENTAL CASUALTY COMPANY.
         Third-Party Defendant-Appellee.


                                     STANLEY D. BAUM, Lansdale, PA, for Plaintiff-Appellant.

                                     MICHAEL H. BERNSTEIN (John T. Seybert on the brief), Sedg-
                                     wick, Detert, Moran & Arnold LLP, New York, New York;
                                     Shannon McCarthy Jandorf, Marshall Law Group, Wellesley,
                                     Massachusetts, for Defendant-Third Party-Plainitff-Appellee,
                                     Third-Party Defendant-Appellee.
       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the district court be AFFIRMED.

       Plaintiff-Appellant Susan Schnur appeals from a grant of summary judgment in favor of

Defendant-Third-Party Plaintiff-Appellee CTC Communications Corp. Group Disability Plan and

Third-Party Defendant-Appellee Continental Casualty Company (“CCC”) on plaintiff’s claims

which are brought pursuant to the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C.

§§ 1001 et seq., and which stem from the denial of her claim for long-term disability (“LTD”)

benefits under the Group Disability Plan (“the Plan”). Specifically, Schnur alleged below that the

Plan’s outside claims administrator, non-party CNA Group Life Assurance Company (“CNA”),

failed to credit the medical evidence establishing her permanent disability, and, further, that the

process by which CNA evaluated her claim was so procedurally flawed as to render it unreliable.

The district court (Sullivan, J.) rejected those claims, finding that CNA’s denial of the claim was

not “arbitrary and capricious” and thus that Schnur could not establish an entitlement to relief. On

appeal, Schnur contends, first, that the district court erred in applying the “arbitrary and capacious”

standard when it should have, instead, reviewed her claim de novo, but, second, that even under the

“arbitrary and capricious” standard, she was entitled to relief because CNA’s heavily flawed process

of reviewing her claim resulted in a decision that is supported by no reliable evidence. We presume

the parties’ familiarity with the underlying facts, the procedural history, and the issues on appeal and

revisit those issues only as necessary to facilitate this discussion.

       “In an ERISA action, we review the district court’s grant of summary judgment based on the

administrative record de novo and apply the same legal standard as the district court.” Hobson v.

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Metro. Life Ins. Co., 574 F.3d 75, 82 (2d Cir. 2009). As noted, the district court applied the

“arbitrary and capricious” standard in reviewing the administrative record, an issue Schnur

challenges on appeal.

       “Although generally an administrator’s decision to deny benefits is reviewed de novo, where

. . . written plan documents confer upon a plan administrator the discretionary authority to determine

eligibility, we will not disturb the administrator’s ultimate conclusion unless it is arbitrary and

capricious.” Id. (internal quotation marks omitted). Here, there is no serious dispute that the written

plan documents confer discretionary authority upon CTC as the plan administrator and on “other

Plan fiduciaries.”1 Schnur simply contends that CNA was not an “other Plan fiduciar[y]” as that

term is used in those documents. We reject that argument for substantially the reasons set forth by

the district court. In so doing, we emphasize that, as the sole claims administrator for the Plan, CNA

was clearly engaged in the sort of activity that gives rise to a fiduciary responsibility and is thus

frequently associated with a “Plan fiduciary.” See, e.g., Aetna Health Inc. v. Davila, 542 U.S. 200,

218-19 (2004) (“A benefit determination under ERISA . . . is generally a fiduciary act” and is “part

and parcel of the ordinary fiduciary responsibilities connected to the administration of a plan.”).

       Accordingly, like the district court, we review CNA’s denial of Schnur’s claim for benefits

under the “arbitrary and capricious” standard, reversing “only if the decision was without reason,



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          For the first time on appeal, Schnur argues that the relevant language was contained
only in the “Summary Plan Description,” not the Plan itself. However, before the district court,
Schnur quoted from the same section of the SPD in conceding that “the LTD Plan Language
grants CCC ‘discretionary authority to interpret the terms of the Plan and to determine eligibility
to benefits in accordance with the Plan.’” Because Schnur admitted that the “LTD Plan
Language” includes this quoted passage from the SPD, we deem any argument to the contrary to
be waived. See In re: Nortel Networks Corp Securities Litig., 539 F.3d 129, 132 (2d Cir. 2008).
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unsupported by substantial evidence or erroneous as a matter of law.” Durakovic v. Bldg. Serv. 32

BJ Pension Fund,      609 F.3d 133, 141 (2d Cir. 2010) (internal quotation marks omitted).

“Substantial evidence is such evidence that a reasonable mind might accept as adequate to support

the conclusion reached by the administrator and requires more than a scintilla but less than a

preponderance.” Id. (internal quotation marks omitted).

       Here, “substantial evidence” supports the denial of Schnur’s claim. Specifically, CNA relied

on the opinions of not one but two retained physicians, both of whom reviewed Schnur’s medical

record and independently determined that there was insufficient evidence to support a finding of

permanent disability. Specifically, as both those doctors found—and the record on appeal

supports—virtually all of Schnur’s symptoms were “self-reported” and backed by little, if any,

physical evidence.    Cf. Hobson, 574 F.3d at 88 (“[I]t is not unreasonable for ERISA plan

administrators to accord weight to objective evidence that a claimant’s medical ailments are

debilitating[,]” or a lack thereof, “in order to guard against fraudulent or unsupported claims.”).

Moreover, as those doctors noted, even if fully credited, Schnur’s symptoms did not warrant a

finding of total and permanent disability. Moreover, that CNA chose to credit its own, outside

doctors over Schnur’s personal physician is not, itself, grounds for reversing the determination

because “courts have no warrant to require administrators automatically to accord special weight

to the opinions of a claimant’s physician; nor may courts impose on plan administrators a discrete

burden of explanation when they credit reliable evidence that conflicts with a treating physician’s

evaluation.” Black & Decker Disability Plan v. Nord, 538 U.S. 822, 834 (2003).

       Alternatively, Schnur contends that various “procedural irregularities” in CNA’s handling



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of her claim warrant discounting the administrator’s findings. Many of these claims were not raised

below and are thus deemed waived on appeal. See In re: Nortel Networks Corp. Sec. Litig., 539

F.3d 129, 132 (2d Cir. 2008). As for those claims that were preserved, Schnur first contends that

CNA had a potential conflict of interest caused by its role as both a claims administrator and

reinsurer of the Plan, and, second, that CNA’s initial notice of denial did not comport with statutory

and regulatory requirements. Neither claim has merit. With respect to the alleged conflict, the

record makes clear—and Schnur does not dispute—that CNA took “active steps to reduce potential

bias . . . by walling off claims administrators from those interested in firm finances” and, as such,

the asserted conflict “prove[s] less important (perhaps to the vanishing point).” McCauley v. First

Unum Life Ins. Co., 551 F.3d 126, 133 (2d Cir. 2008) (quoting Metro. Life Ins. Co. v. Glenn , 554

U.S. 105, 117 (2008)).

       With respect to the notice, Schnur relies on ERISA section 503(1) which requires a plan

administrator to provide the claimant “with adequate notice in writing . . . setting forth the specific

reasons for such denial, written in a manner calculated to be understood by the participant.” 29

U.S.C. § 1133(1). Implementing regulations require plan administrators to furnish the participant

with, among other things, a “description of any additional material or information necessary for the

claimant to perfect the claim and an explanation of why such material or information is necessary.”

29 C.F.R. § 2650.503-1(g)(1). Schnur contends CNA’s initial notice of denial failed to comply with

this provision.   We disagree.       CNA’s notice of denial—a thorough, four-and-a-half-page

document—amply laid out the basis for the denial, and, by implication, a description of those

materials necessary to perfect the claim. Specifically, that notice informed Schnur that “we do not



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see any evidence in the current medical records to establish that your condition imposes a physical

or psychological impairment that would preclude you from engaging in the substantial and material

duties of your regular occupation on a sustained basis.” As such, we see no basis for concluding

that CNA’s notice departed in any material respect from statutory and regulatory requirements.



       To the extent Schnur raises other arguments on appeal, we have considered them and find

them to be without merit. Accordingly, for the foregoing reasons, the judgment of the district court

is hereby AFFIRMED.


                                                     FOR THE COURT:
                                                     Catherine O’Hagan Wolfe, Clerk




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