                           NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        FEB 16 2017
                                                                     MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT



 JOHN DEL GALLEGO,                               No.    15-15294

                 Plaintiff-Appellant,            D.C. No. 3:13-cv-04518-VC

   v.
                                                 MEMORANDUM*
 WELLS FARGO & COMPANY LONG
 TERM DISABILITY PLAN;
 METROPOLITAN LIFE INSURANCE
 COMPANY,

                 Defendants-Appellees.

                   Appeal from the United States District Court
                      for the Northern District of California
                   Vince G. Chhabria, District Judge, Presiding

                          Submitted February 14, 2017**
                            San Francisco, California

Before: SILER,*** TASHIMA, and HURWITZ, Circuit Judges.



        *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
        ***
             The Honorable Eugene E. Siler, Circuit Judge for the U.S. Court of
Appeals for the Sixth Circuit, sitting by designation.
      In this ERISA action, John Del Gallego alleges that the Wells Fargo &

Company Long Term Disability Plan (the “Plan”) and the Plan insurer, Metropolitan

Life Insurance Company (“MetLife”), improperly offset Del Gallego’s permanent

partial disability workers’ compensation (“PPD”) benefits against his Plan long-term

disability benefits. The district court granted summary judgment to the Plan and

MetLife. We affirm.

      1. The Plan, which incorporates a group Certificate of Insurance issued by

MetLife, provides that long-term disability benefits are “reduced by Other Income

Benefits.” The Plan definition of “Other Income Benefits” includes “Workers’

Compensation or a Similar Law,” and states that “[p]eriodic benefits and substitutes

and exchanges for periodic benefits will be counted.”

      2. Courts interpret ERISA policy terms in the “ordinary and popular sense as

would a person of average intelligence and experience.” Babikian v. Paul Revere

Life Ins. Co., 63 F.3d 837, 840 (9th Cir. 1995) (quoting Evans v. Safeco Life Ins.

Co., 916 F.2d 1437, 1441 (9th Cir. 1990)). The plain language of the Plan provides

that a covered employee’s long-term disability benefits will be reduced by periodic

workers’ compensation benefits received by the employee, and the district court

therefore did not err in interpreting the Plan.

      3. Del Gallego argues that “other income benefits” are only those paid to

compensate for lost wages, and therefore include only temporary disability


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payments. But, the case upon which Del Gallego relies, Russell v. Bankers Life Co.,

120 Cal. Rptr. 627 (Ct. App. 1975), involved an insurance contract defining “income

from other sources” as “any payment . . . under a Workmen’s Compensation Act . . .

providing benefits for loss of time from employment.” Id. at 629-630, 633-34.

Because the Plan does not limit “Other Income Benefits” to those providing benefits

for loss of time from employment, Russell is inapposite.

      4. Del Gallego argues that because the Plan requires proof of “the amount

attributable to lost income” when an employee receives “Other Income Benefits in

a lump sum instead of in monthly payments,” reductions must be limited to the

portion of the lump sum payment attributable to lost income. But, the provision he

cites only applies to lump sum payments, not to periodic benefits, and the Plan did

not set off the lump sum workers’ compensation settlement that Del Gallego

received against his Plan benefits.

      5. Del Gallego also argues that the phrase “workers’ compensation” is

ambiguous because a reasonable person would not anticipate that payments

“intended to provide for the future of the injured worker” would be offset from

disability insurance benefits. But, the language of the Plan unambiguously covers

all workers’ compensation benefits. See Ott v. Workers’ Comp. Appeals Bd., 173

Cal. Rptr. 648, 650-51 (Ct. App. 1981) (finding no ambiguity when Plan stated

“payments required by Workmen’s Compensation Laws” offset Plan benefits); see


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also Peterson v. Am. Life & Health Ins. Co., 48 F.3d 404, 411-12 (9th Cir. 1995)

(rejecting application of reasonable expectations doctrine when insurance policy was

“unambiguous and conspicuous”).

      6. Del Gallego argues that, even if his weekly PPD benefits were for loss of

future earning capacity, these payments are not “income.” This argument is at odds

with precedent, see Jones & Laughlin Steel Corp v. Pfeifer, 462 U.S. 523, 533 (1983)

(describing impaired earning capacity as “diminution in…stream of income”), and

the Plan language, which defines workers’ compensation benefits as “Other

Income.”

      7. Del Gallego argues that the term “periodic benefits” is facially ambiguous.

To the contrary, a “person of average intelligence and experience,” Babikian, 63

F.3d at 840 (quoting Evans, 916 F.2d at 1441), would understand “periodic benefits”

to include benefits paid in weekly increments.          See Periodic, MERRIAM-

WEBSTER.COM (defining “periodic” as “occurring or recurring at regular intervals”).

And, because the Plan has specific language separately exempting lump sum

payments from the setoff, it is not possible to interpret “periodic payments” as

including a lump sum payment.

      AFFIRMED.




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