Hart v. Capgemini U.S. LLC Welfare Benefit Plan Administration Document

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit

FOR THE TENTH CIRCUIT November 15, 2013

Elisabeth A. Shumaker
Clerk of Court
SCOTT HART,

Plaintiff-Appellant,

v. No. 13-1001
(D.C. No. 1:09-CV-02571-RBJ-BNB)
CAPGEMINI U.S. LLC WELFARE (D. Colo.)
BENEFIT PLAN ADMINISTRATION
DOCUMENT, (of which the long term
disability plan is a part),

Defendant-Appellee.

ORDER AND JUDGMENT*

Before HARTZ, BALDOCK, and GORSUCH, Circuit Judges.

Plaintiff Scott Hart appeals the district court’s judgment in favor of defendant

Capgemini U.S. LLC Welfare Benefit Plan Administration Document (Capgemini),

denying him long-term disability (LTD) benefits under 29 U.S.C. § 1132(a)(1)(B) of

*
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore
ordered submitted without oral argument. This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
the Employee Retirement Income Security Act of 1974 (ERISA). Exercising

jurisdiction under 28 U.S.C. § 1291, we affirm.

I. Background

Hart worked as a senior business consultant for Capgemini U.S. LLC

(Capgemini LLC). After developing complications from pneumonia, he stopped

working in January 2002. Capgemini LLC provided disability insurance to its

employees through a group policy issued by Hartford Life Insurance Company,

which was the claims fiduciary under the policy. Hart was initially approved for

short-term disability (STD) benefits, but Hartford terminated those benefits effective

April 28, 2002. Capgemini LLC terminated Hart in November 2002.

In January 2005, Hart experienced chest pain and shortness of breath. He was

diagnosed with aortic stenosis and coronary artery disease, and had surgery. Hart’s

counsel wrote to Hartford that month and asked that it initiate an LTD claim.

Hartford sent Hart’s counsel the necessary documents in February 2005. Hartford

ultimately denied Hart’s claim for LTD benefits in September 2005, and denied

Hart’s appeal in April 2006.

Hart then filed this suit against Capgemini in Colorado state court in July

2007, serving his complaint through the Secretary of the United States Department of

Labor. He obtained a default judgment against Capgemini, which the state court later

vacated for improper service of process. Capgemini then removed the action to

federal district court. The district court ordered briefing on the administrative record,

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denied Hart’s request for a jury trial, and ultimately entered an order denying Hart’s

claim for LTD benefits.

Hart appeals, contending that (1) the state court improperly vacated the default

judgment; (2) the district court applied an incorrect standard of review of

Capgemini’s denial of benefits; (3) he is entitled to a jury trial; and (4) the district

court erred in disposing of the case after briefing on the administrative record.

II. Discussion

A. Default Judgment

“After removal, the federal court takes the case up where the State court left it

off.” Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers

Local No. 70 of Alameda Cnty., 415 U.S. 423, 436 (1974) (internal quotation marks

omitted). “[A]n order entered by a state court should be treated as though it had been

validly rendered in the federal proceeding.” Carvalho v. Equifax Info. Servs., LLC,

629 F.3d 876, 887 (9th Cir. 2010) (internal quotation marks omitted). But we apply

state procedural rules to preremoval conduct. See Romo v. Gulf Stream Coach, Inc.,

250 F.3d 1119, 1122 (7th Cir. 2001); Fed. R. Civ. P. 81(c)(1) (Federal Rules of Civil

Procedure govern proceedings in an action after removal).

Hart argues that the state court improperly vacated the default judgment

against Capgemini as void under Rule 60(b)(3) of the Colorado Rules of Civil

Procedure because of improper service. We review this issue de novo. See Hukill v.

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Okla. Native Am. Domestic Violence Coalition, 542 F.3d 794, 797 (10th Cir. 2008);

First Nat. Bank of Telluride v. Fleisher, 2 P.3d 706, 714 (Colo. 2000) (en banc).

The state court had no choice but to vacate the default judgment because of

improper service of the complaint (so whatever test it used is irrelevant). Hart argues

that his service on Capgemini through the Secretary of Labor was proper. Under

29 U.S.C. § 1132(d)(1), service on the Secretary of Labor is permitted if the

summary plan description (SPD) does not designate “an individual as agent for the

service of legal process.” Capgemini’s SPD stated that its “general counsel” was its

agent for service of process, and Hart asserts that the job title does not qualify as an

“individual” under § 1132(d)(1) because it does not refer to a “particular individual

human being,” Aplt. Reply Br. at 16. We disagree. A title can identify a particular

individual as precisely as (often more precisely than) a first and last name. We are

aware of no authority, and Hart has pointed to none, requiring any special method of

identifying a specific individual to satisfy § 1132(d)(1). We decline to address Hart’s

other arguments to justify service on the Secretary because they were not raised in

state court.

B. Standard of Review Applied by District Court

Hart next claims that the district court applied the incorrect standard to review

the decision to deny LTD benefits. He contends that the district court should have

reviewed the decision de novo, instead of for abuse of discretion, because Hartford’s

initial benefit decision was untimely under ERISA.

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 “We review de novo the district court’s determination of the proper standard to

apply in its review of an ERISA plan administrator’s decision.” Rasenack ex rel.

Tribolet v. AIG Life Ins. Co., 585 F.3d 1311, 1315 (10th Cir. 2009) (internal

quotation marks omitted). Where, as here, an ERISA plan grants a plan administrator

or fiduciary discretionary authority to determine eligibility for benefits or to construe

the terms of the plan, we apply a deferential standard of review, asking only whether

the denial of benefits was arbitrary and capricious. See LaAsmar v. Phelps Dodge

Corp. Life, Accidental Death & Dismemberment & Dependent Life Ins. Plan,

605 F.3d 789, 796 (10th Cir. 2010); see also Foster v. PPG Indus., Inc., 693 F.3d

1226, 1232 (10th Cir. 2012) (equating arbitrary-and-capricious standard and

abuse-of-discretion standard in ERISA case). But de novo review may nevertheless

be appropriate when there have been procedural irregularities in the administrator’s

consideration of the benefits claim. See LaAsmar, 605 F.3d at 797. One such

irregularity would be a plan administrator’s failure to render a final decision within

the time limits prescribed by the plan and ERISA. See Rasenack, 585 F.3d at

1316-18 (applying de novo review).

Hart contends that Hartford delayed its benefits decision for over three years

from the time of his alleged initial LTD notice of claim in February 2002 and his

counsel’s appeal letter to Hartford in July 2002, or, alternatively, for over six months

from his “final demand” to initiate an LTD claim in January 2005. Aplt. Opening Br.

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at 53. He asserts a violation of the mandate of the insurance policy and ERISA to

make claims decisions within 45 days. See Aplt. App. at 767; 29 C.F.R.

§ 2560.503-1(f)(3). But Hart’s notice of claim for STD benefits in February 2002

and his July 2002 letter appealing the denial of STD benefits were not proper claims

for LTD benefits. And Hartford was not untimely in responding to Hart’s 2005

claim. The claim was not properly completed until July 22, 2005, and Hartford

properly extended the 45-day time limit by 30 days to collect necessary information.

Hartford’s denial on September 15, 2005, was therefore within the time limit.

Because there were no procedural irregularities, the district court did not err in

reviewing the benefits determination for abuse of discretion.

C. Jury Trial Demand

Hart next argues that the district court improperly determined that he was not

entitled to a jury trial on his claim for disability benefits under § 1132(a)(1)(B). We

review this question of law de novo. See Graham v. Hartford Life & Accident Ins.

Co., 589 F.3d 1345, 1355 (10th Cir. 2009). In Graham we held that the Seventh

Amendment does not guarantee a right to a jury trial in an action for benefits under

§ 1132(a)(1)(B) because the relief is equitable rather than legal. See id. at 1355-56.

Hart essentially asks us to revisit Graham. We decline the invitation. Absent

en banc reconsideration or a superseding contrary Supreme Court decision, our

precedent is binding. See United States v. De Vaughn, 694 F.3d 1141, 1149 n.4

(10th Cir. 2012).

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 D. Bench Trial on the Merits

Finally, Hart submits that the district court should have resolved the case by a

bench trial on the merits, giving him an opportunity to present and challenge

evidence. He relies on a footnote in Jewell v. Life Insurance Company of North

America, which stated:

The Federal Rules of Civil Procedure contemplate no such
mechanism as judgment on the administrative record.
Parties should avoid the practice of requesting it, and
courts should avoid purporting to grant it. Doing so often
creates unnecessary work for an appellate court in deciding
whether to construe such a motion ex post as one for a
bench trial on the papers, or as one for summary judgment.

508 F.3d 1303, 1307 n.1 (10th Cir. 2007) (citations omitted) (internal quotation

marks omitted). Jewell did not, however, suggest that a plaintiff seeking review of

an ERISA benefit denial is entitled to present evidence outside the administrative

record to prove his or her claim. On the contrary, in reviewing a plan administrator’s

decision for abuse of discretion, “federal courts are limited to the administrative

record – the materials compiled by the administrator in the course of making his

decision.” Hall v. Unum Life Ins. Co. of Am., 300 F.3d 1197, 1201 (10th Cir. 2002)

(internal quotation marks omitted). Thus, we perceive no error in the procedure

followed by the court.

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 III. Conclusion

The judgment of the district court is affirmed.

Entered for the Court

Harris L Hartz
Circuit Judge

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