NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 16a0673n.06
No. 15-3470
FILED
UNITED STATES COURT OF APPEALS Dec 15, 2016
FOR THE SIXTH CIRCUIT DEBORAH S. HUNT, Clerk
JACK B. CALHOUN, JR., )
)
Plaintiff-Appellant, )
)
v. )
ON APPEAL FROM THE UNITED
)
STATES DISTRICT COURT FOR THE
LIFE INSURANCE COMPANY OF )
SOUTHERN DISTRICT OF OHIO
NORTH AMERICA, )
)
Defendant-Appellee. )
)
BEFORE: DAUGHTREY, ROGERS, and WHITE, Circuit Judges.
MARTHA CRAIG DAUGHTREY, Circuit Judge. The plaintiff, Jack Calhoun, Jr., filed
this Employee Retirement Income Security Act (ERISA) action against defendant Life Insurance
Company of North America (LINA) after the insurance company terminated his long-term
disability benefits. In deciding to end Calhoun’s benefits, LINA concluded that Calhoun was no
longer “totally disabled,” which was a prerequisite to Calhoun’s receipt of disability benefits
under the insurance plan. The district court upheld LINA’s determination, finding that under the
deferential arbitrary-and-capricious standard of review, LINA’s termination of benefits was not
arbitrary and capricious. For the reasons set out below, we conclude that LINA’s decision to
terminate Calhoun’s benefits was not the product of reasoned decision-making and was not
supported by substantial evidence. Therefore, we hold that LINA acted arbitrarily and
capriciously when it denied Calhoun’s claim, and we reverse the judgment of the district court
and remand the case for further proceedings.
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FACTUAL AND PROCEDURAL BACKGROUND
As a senior maintenance technician at Mars, Inc., Calhoun “[r]an a team of technicians to
repair & maintain factory equip[ment].” Calhoun, however, stopped working in January 2010
due to chronic leg and back pain that was aggravated by sitting, standing, and walking.
Dr. Monique Boezi, Calhoun’s primary-care physician, summarized Calhoun’s symptoms:
Any walking hurts [Calhoun’s] back. . . . . If he stands for any leng[th] of
time, about 10 minutes[,] he has to use a cane o[r] sit down . . . . His legs
go numb when he sits for longer than 20-30 minutes . . . . All of these
symptoms are daily and really affect his normal living . . . . [H]e cannot
walk, stand, or sit for prolonged periods of time.
Dr. Boezi’s treatment notes consistently reflected Calhoun’s inability to sit or stand for
prolonged periods of time, leading her to conclude that Calhoun could not work in his job as a
maintenance technician because it required “a lot of walking and lifting and bending with
prolonged standing,” but also that he could not work at a desk job, which required long periods
of sitting. Electromyography confirmed that Calhoun suffered from meralgia paresthetica, a
compression of a nerve in the thigh, and an MRI revealed degenerative disc disease at L5-S1, a
vertebral segment at the base of the spine.
In addition to his primary-care appointments with Dr. Boezi, Calhoun regularly saw Dr.
Nancy Vaughan, an orthopedic specialist, for treatment of his condition. Dr. Vaughan reported
that Calhoun could not stand for longer than 20 minutes and noted Calhoun’s difficulties with
walking, but she declined Calhoun’s request for a power scooter, explaining that “[t]he sedentary
lifestyle is more harmful to his health.” Dr. Vaughan wrote in her treatment notes that she
thought Calhoun was “limiting his function more than he should be” and that his pain was “out
of proportion to objective findings.” Calhoun also saw several other specialists: Dr. Robert
Dixon, a neurosurgeon, who confirmed that Calhoun’s symptoms were consistent with
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Drs. Boezi and Vaughan’s diagnoses; Dr. Robert Stephenson, a physical medicine and
rehabilitation specialist, who opined that it was unlikely that Calhoun’s spine was the cause of
pain “so severe that [Calhoun] must use a motorized scooter”; and Dr. James Powers, another
physical medicine and rehabilitation specialist, who opined that it was more likely that Calhoun’s
pain was musculoskeletal rather than neurological.
After exhausting his short-term disability leave, Calhoun submitted a disability claim
under Mars’s long-term disability plan. The plan, administered by LINA, provided monthly
benefits payments to employees with a “total disability.” An employee was defined as “totally
disabled” if, during an initial 24-month period, he was “unable to perform all the essential duties
of his occupation.” After that 24-month period, an employee was “totally disabled” only if “he
[was] unable to perform all the essential duties of any occupation” for which he was reasonably
qualified and also “remain[ed] unable to earn more than 75% of his Basic Monthly Earnings.”
LINA both determined which claims were eligible for benefits under the plan and paid the
benefits for eligible claims.
While his claim before LINA was pending, Calhoun applied for Social Security benefits
with the assistance of LINA, which arranged and paid for Calhoun’s representation before the
Social Security Administration (SSA). The plan stipulated that if the employee refused LINA’s
assistance with the SSA claim, then the employee’s monthly payments would be reduced by the
amount of benefits that the employee would be “assumed to receive” from the SSA for his
disability. If the employee cooperated with LINA’s assistance with the SSA claim, as Calhoun
did, then his monthly payments would not be reduced by the assumed receipt of SSA] benefits.
Under the terms of the plan, if his SSA claim was successful, the employee was required to
reimburse LINA for any overpayment in his monthly benefits.
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In July 2010, LINA notified Calhoun that he satisfied the plan’s definition of total
disability, and LINA approved Calhoun’s claim for long-term disability benefits approximately
one month later. LINA informed Calhoun that LINA would continue to monitor his claim, with
subsequent payment of benefits contingent upon “confirmation of [his] continuing disability-
status.” Calhoun’s long-term disability benefits commenced on July 26, 2010. To document
Calhoun’s level of daily activity, LINA arranged for video surveillance of Calhoun over a three-
day period in March 2011. The surveillance company, PhotoFax, Inc., reported that it had
obtained nine minutes of film of Calhoun “walking, talking, driving, entering and exiting his
vehicle, pushing a shopping cart, and carrying bags of groceries” and 13 minutes of film of
Calhoun “sitting down and pushing a shopping cart through a store.”
After Calhoun had received 15 months of benefits payments, LINA reminded him that,
consistent with the benefits plan, he would receive benefits beyond the initial 24-month period
only if he was “unable to perform all the material duties of any occupation” for which he
reasonably could be qualified. LINA informed Calhoun that it would review his claim to
determine his continued eligibility for benefits. In addition to reviewing the medical records
from his treating physicians, LINA arranged for Calhoun to be evaluated through a functional-
capacity analysis, additional video surveillance, transferrable-skills analysis, and peer review of
Calhoun’s medical file.
In March 2012, occupational therapist Scott Secrest conducted a functional-capacity
analysis of Calhoun. Secrest observed that Calhoun could lift or carry certain amounts of weight
occasionally but that he could not carry even negligible weight frequently. Secrest further
observed that Calhoun “exhibit[ed] limited tolerance for sustained sitting or standing” and
“limited tolerance for various mobility tasks such as walking, stooping, kneeling and climbing
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stairs, each of which he [was] able to perform on no more than an occasional basis.” Secrest
concluded that Calhoun would “require at least one break every hour for 5-10 minutes from
sustained sitting” and that he could not tolerate standing for more than 15-20 minutes without a
break.
To supplement the functional-capacity analysis, LINA engaged PhotoFax for a second
round of video surveillance of Calhoun. Over the three-day period in which Calhoun was
photographed, PhotoFax obtained approximately three minutes of film of Calhoun “walking,
entering and exiting a vehicle, driving, slightly leaning, and using his right hand and arm to open
a vehicle door.” PhotoFax reported that Calhoun “performed these activities while walking in a
slow manner.” Based on the functional-capacity analysis and the second round of video
surveillance, LINA conducted a transferrable-skills analysis to assess whether there were any
jobs consistent with Calhoun’s physical capacity. This analysis concluded that “transferability
could not be identified” because of Calhoun’s “demonstrated restriction to occasional standing
and walking.” On March 19, 2012, LINA informed Calhoun that LINA had completed its
review and that Calhoun’s benefits would continue beyond the 24-month period.
In April 2012, Calhoun was awarded Social Security benefits for his disability. In
finding that Calhoun was disabled within the meaning of the Social Security Act, an
administrative law judge (ALJ) based his conclusion on, among other things, the functional-
capacity analysis, the MRI, physician treatment notes, testimony from a vocational expert, and
statements from Calhoun regarding “the intensity, persistence and limiting effects” of his
condition, all of which the ALJ found “generally credible.” The judge determined that the
objective medical evidence established that Calhoun had some residual-functional capacity but
found that Calhoun’s limitations precluded his ability to perform light work. The ALJ
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concluded, “I find the claimant’s additional limitations so narrow the range of work he might
otherwise perform that a finding of ‘disabled’ is appropriate.” After learning of Calhoun’s
Social Security benefits award, LINA reduced Calhoun’s monthly benefits and, for
reimbursement purposes, calculated the amount that Calhoun had been overpaid.
Despite the findings of the ALJ, LINA conducted an exploratory transferrable-skills
analysis during the following month, in order to identify sedentary occupations available to
Calhoun. This analysis noted that “updated limitations and restrictions would be required” for a
formal transferrable-skills analysis. LINA therefore arranged for PhotoFax to conduct a third
round of video surveillance of Calhoun’s daily activities. After surveilling Calhoun for three
days, PhotoFax reported that it had obtained approximately 18 minutes of film of Calhoun “as he
walked, stood from sitting/laying/and kneeling positions without assistance on multiple
occasions, walked with a walker at a [store]” and lay on his back as he worked on a lawnmower,
among other things. PhotoFax reported that Calhoun “appeared to perform these activities in a
fluid and unrestricted manner, without the use of any assistive devices.”
LINA then engaged Dr. David Trotter, an orthopedic surgeon, to conduct a peer review
of Calhoun’s medical file. In his report, Dr. Trotter wrote, “The available documentation
including surveillance video supports that the observed activities of daily living are inconsistent
with the claimant’s self-reported limitations and overall self reported dysfunction.” Dr. Trotter
rejected the conclusions of the March 2012 functional-capacity analysis, stating that “the
objective findings are not commensurate with the rather inexplicable findings/lessor functionality
evident within the [analysis].” Dr. Trotter clarified in an addendum to his report that “there is no
credible evidence indicating this claimant is unable to perform full time sedentary or light level
work.” Dr. Trotter’s review did not include a physical examination of Calhoun.
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Shortly after receiving Dr. Trotter’s report, LINA requested a second transferrable-skills
analysis to determine whether there were jobs within Calhoun’s physical capacity. This analysis
was “based solely on restrictions and limitations cited by Dr. Trotter” in his peer-review report
and addendum. The analysis concluded that Calhoun would be able to perform “sedentary or
light work classification occupations” and identified four of them: maintenance supervisor,
preventive maintenance coordinator, electric-meter repairer, and an inside-meter tester.
Two days after the second transferrable-skills analysis, LINA informed Calhoun that it
was terminating his long-term disability benefits. LINA noted that it had reviewed, among other
things, Calhoun’s disability questionnaire, Dr. Boezi’s medical records of Calhoun’s treatment,
the March 2012 functional-capacity analysis, the March and September 2012 surveillance
videos, and Dr. Trotter’s peer-review report and addendum. LINA noted that it had considered
the fact that Calhoun was awarded Social Security benefits but asserted that it was “in receipt of
more recent information than the SSA had to consider at the time of its decision.” Although
LINA did not identify this “more recent information,” LINA explained that its conclusion that
Calhoun “retain[ed] the capacity to perform full-time Sedentary-Light work” was “[b]ased on
[Dr. Trotter’s] Peer Review results,” that the transferrable-skills analysis “identified several
transferable Light occupations” and that the “surveillance provided some insight into
[Calhoun’s] functionality.” LINA determined that Calhoun was not totally disabled and
terminated his benefits on October 19, 2012.
Calhoun appealed the termination of his benefits through LINA’s internal review process.
In considering Calhoun’s appeal, LINA engaged Dr. Elena Antonelli to conduct a second peer
review. Dr. Antonelli reviewed Calhoun’s medical file and the three sets of surveillance videos,
and she discussed Calhoun’s “history, [functional-capacity analysis] results, and the surveillance
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No. 15-3470, Calhoun v. Life Insurance Company of North America
video” with Dr. Boezi. In her report, Dr. Antonelli wrote that she and Dr. Boezi “agreed that
[Calhoun] needs restrictions but is not totally impaired.” Dr. Antonelli also said that the March
2012 functional-capacity analysis “may have been somewhat unreliable but likely reflects the
minimum abilities of [Calhoun],” and she concluded, “Based on the totality of his conditions,
[Calhoun] likely requires some restrictions on his activities but he is likely to be able to perform
as the [functional-capacity analysis] indicated. He is also capable of driving an automobile and
can work 8 hours per day and 40 hours per week.” LINA then conducted a third transferrable-
skills analysis. This analysis was based on Dr. Antonelli’s peer-review report and the functional-
capacity analysis. The transferrable-skills analysis identified three jobs consistent with
Calhoun’s capability: maintenance scheduler, maintenance superintendent, and order-takers
supervisor.
On June 11, 2013, LINA denied Calhoun’s appeal. In its letter informing Calhoun of the
denial, LINA stated that it had reviewed Calhoun’s entire file, including the favorable SSA
determination and determined that “the weight of the evidence in [Calhoun’s] claim file supports
his ability to perform the material duties of any occupation.” In the section of its letter
explaining its rationale for terminating Calhoun’s benefits, LINA summarized Dr. Antonelli’s
peer-review report and the third transferrable-skills analysis. LINA also noted that it was “in
receipt of more current medical information than the [SSA] had at the time of their initial
determination,” but did not specify the information to which it was referring.
All in all, Calhoun received long-term disability benefits for 27 months, from July 26,
2010, through October 25, 2012. Convinced that LINA terminated his benefits wrongfully,
Calhoun sued LINA in district court under ERISA, 29 U.S.C. §§ 1001–1461, seeking their
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reinstatement. Both parties moved for judgment on the administrative record, and the district
court found in favor of LINA. From that ruling, Calhoun now appeals.
DISCUSSION
We review de novo the district court’s judgment on the administrative record. Bennett v.
Kemper Nat. Services, Inc., 514 F.3d 547, 552 (6th Cir. 2008). However, if, as here, the benefits
plan gives the plan administrator discretionary authority to determine eligibility for benefits, we
review a decision to deny benefits using the arbitrary-and-capricious standard of review. Id.
Under this standard, “we uphold the administrator’s decision if it is the result of a deliberate,
principled reasoning process and it is supported by substantial evidence.” Id. (internal quotation
marks and citation omitted). Though this standard is deferential, “our review is no mere
formality.” Glenn v. MetLife, 461 F.3d 660, 666 (6th Cir. 2006), aff’d, 554 U.S. 105 (2008). In
reviewing under this standard, we do not “merely . . . rubber stamp the administrator’s decision.
Instead, we are required to review the quality and quantity of the medical evidence and the
opinions on both sides of the issues.” Id. (internal marks and citation omitted).
In considering whether the decision to terminate benefits was arbitrary and capricious,
“we also factor in whether there existed a conflict of interest, whether the plan administrator
failed to give consideration to the Social Security Administration’s determination that the
applicant was totally disabled, and whether the plan administrator based its decision to deny
benefits on a file review as opposed to conducting a physical examination of the applicant.”
Bennett, 514 F.3d at 552-53 (internal marks omitted) (citing Calvert v. Firstar Fin., Inc., 409
F.3d 286, 295 (6th Cir. 2005)). These considerations do not alter the standard of review, but
rather factor into our analysis whether the plan administrator’s decision was arbitrary and
capricious. Id.
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Conflict of Interest
A conflict of interest exists for ERISA purposes when the plan administrator both
evaluates claims—i.e., determines which claims are covered under the benefits plan—and pays
those claims. Glenn, 554 U.S. at 114; DeLisle v. Sun Life Assurance Co. of Canada, 558 F.3d
440, 445 (6th Cir. 2009). The existence of a conflict is “a factor in determining whether the plan
administrator has abused its discretion in denying benefits,” with the significance of the conflict
varying according to the circumstances of the case. Glenn, 554 U.S. at 108. 114. For example,
the conflict of interest may act as a “tiebreaker when the other factors are closely balanced,” or it
may “prove more important . . . where circumstances suggest a higher likelihood that it affected
the benefits decision.” Id. at 117.
Here, LINA had a conflict of interest because it both determined whether claimant was
eligible for benefits under the plan and also paid out the benefits. Moreover, because LINA took
“seemingly inconsistent positions [that] were both financially advantageous” by assisting
Calhoun with his receipt of SSA benefits and yet failing to address the SSA award adequately in
terminating his benefits claim, we are justified “in giving more weight to the conflict.” See id. at
118.
Social Security Administration’s Favorable Determination
LINA’s treatment of the SSA’s disability determination weighs in favor of concluding
that LINA acted arbitrary and capriciously when it terminated Calhoun’s benefits. “[I]f the plan
administrator (1) encourages the applicant to apply for Social Security disability payments;
(2) financially benefits from the applicant's receipt of Social Security; and then (3) fails to
explain why it is taking a position different from the SSA on the question of disability, the
reviewing court should weigh this in favor of a finding that the decision was arbitrary and
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capricious.” Bennett, 514 F.3d at 554. Although the SSA determination is not binding, it is “far
from meaningless,” and, at a minimum, it indicates that the ALJ found objective support for the
claim of disability. Calvert, 409 F.3d at 294.
LINA argues that it “never interfered . . . with the . . . position Calhoun took before the
[SSA] regarding his ability to work,” that it “did not receive the bulk of the benefit from
Calhoun’s success,” and that it did, in fact, address the SSA determination in its letter
terminating Calhoun’s benefits. We find these arguments unconvincing. First, even if LINA
never assisted with Calhoun’s arguments or strategy before the SSA, it certainly encouraged
Calhoun to apply for Social Security benefits through its “Social Security Assistance Program.”
As part of this program, LINA not only arranged and paid for Calhoun’s representation before
the SSA but also would have penalized Calhoun by reducing his benefits if he had not pursued a
SSA claim.
Second, LINA argues that it “received no net-benefit from the Social Security Award”
because the plan allowed LINA to reduce Calhoun’s monthly benefits by his assumed Social
Security award if he did not pursue the SSA claim. However, LINA also benefited financially
when Calhoun pursued Social Security benefits and won, because LINA’s monthly payments to
Calhoun were reduced by the amount of the Social Security award. And, if Calhoun had sought
Social Security benefits and been denied, LINA would not have been able to reduce its monthly
payments to him. See Glenn, 461 F.3d at 667; see also Calvert, 409 F.3d at 294.
Third, LINA argues that the record indicates that it did consider the SSA award when it
made the decision to terminate Calhoun’s benefits. However, LINA’s sole mention of the SSA
award in its denial letters was to note that it had considered the award but rejected it because
LINA was “in receipt of more current medical information than the [SSA] had at the time of
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their initial determination.” LINA failed to identify the “more current medical information” on
which it relied in reaching a contrary decision and also failed to explain why this information
warranted the conclusion that Calhoun was not totally disabled. “[M]ere mention of the [SSA]
decision is not the same as a discussion about why the administrator reached a different
conclusion from the SSA.” Bennett, 514 F.3d at 553 n.2. To the extent that LINA was referring
to the medical evidence that post-dates the favorable SSA determination, LINA failed to explain
why that evidence should be credited over the other evidence in the record. Moreover, for the
reasons discussed below, the evidence post-dating the SSA decision—the Trotter and Antonelli
peer reviews, the additional video surveillance, and the second and third transferrable-skills
analyses—is not substantial evidence supporting the conclusion that LINA’s decision was the
result of a deliberate, principled reasoning process.
File Reviews by Dr. Trotter and Dr. Antonelli
LINA’s reliance on file reviews in denying Calhoun’s claim also weighs in favor of
finding that LINA’s decision was arbitrary and capricious. We have repeatedly raised concerns
regarding file reviews when the reviewing physician makes a conclusion as to the claimant’s
credibility without ever physically examining him. See, e.g., Calvert, 409 F.3d at 295. Although
“there is nothing inherently improper with relying on a file review[,] . . . [w]here . . . the
conclusions from that review include critical credibility determinations regarding a claimant’s
medical history and symptomology, reliance on such a review may be inadequate.” Id. at 297
n.6. Here, Dr. Trotter did not physically examine Calhoun as part of his review, but he
nevertheless concluded that “there is no credible evidence indicating [Calhoun] is unable to
perform full time sedentary or light level work.”
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Dr. Trotter’s file review is also concerning for several other reasons. He nowhere
explained why he believed that the medical evidence did not support Calhoun’s claim; instead,
Dr. Trotter summarized the evidence and baldly asserted that “the observed activities of daily
living are inconsistent with the claimant’s self-reported limitations and overall self reported
dysfunction.” Nor did Dr. Trotter explain his reasons for not crediting the March 2012
functional-capacity analysis; he merely restated verbatim the conclusion from the evaluation,
noted that the MRI and electromyography reflected degenerative disc disease and meralgia
paresthetica, and then asserted that “the objective findings are not commensurate with the rather
inexplicable findings/lessor functionality evident within the [functional capacity analysis].”
Dr. Trotter nowhere discussed the SSA disability determination, perhaps because he was not
aware of it and so did not review it.1 Despite these deficiencies, LINA nonetheless relied on
Dr. Trotter’s review in deciding to terminate Calhoun’s disability benefits.
Dr. Antonelli’s file review, which LINA requested to assist with its review of Calhoun’s
appeal to LINA, is similarly inadequate. In her report, Dr. Antonelli stated that the March 2012
functional-capacity analysis “likely reflects the minimum abilities of [Calhoun]” and concluded
that Calhoun was “capable of driving an automobile and can work 8 hours per day and 40 hours
per week.” Dr. Antonelli, however, did not physically examine Calhoun. It also is unclear how
the evaluation’s findings, which concluded that Calhoun would “require at least one break every
hour for 5-10 minutes from sustained sitting” and could stand for only 15-20 minutes, would
justify the conclusion that Calhoun could work on a full-time basis. Although Dr. Antonelli said
in her report that she and Dr. Boezi, Calhoun’s primary-care physician, agreed that Calhoun was
“not totally impaired,” that statement does not mean that they also agreed as to whether Calhoun
1
The record indicates that the SSA determination was not listed as part of the materials that Dr. Trotter
reviewed.
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was physically capable of working a full-time job.2 Dr. Antonelli also did not discuss the SSA
award—again, perhaps because she was unaware of it. Despite these deficits, LINA nonetheless
gave significant weight to Dr. Antonelli’s file review in deciding to deny Calhoun’s appeal.
LINA’s reliance on the file reviews raises additional concerns because under the benefits
plan, LINA reserved the right to conduct physical examinations of claimants. We have
repeatedly found that “the failure to conduct a physical examination though the benefits plan
explicitly reserves that right raises questions about the thoroughness and accuracy of the benefits
determination.” See, e.g., Shaw v. AT&T Umbrella Benefit Plan No. 1, 795 F.3d 538, 550 (6th
Cir. 2015) (citation and internal quotation marks omitted). Particularly because LINA was
subject to a conflict of interest, LINA’s decision to utilize file reviews and forego a physical
examination, its reliance on the file reviews despite the inadequacies with the reviews, and its
failure to explain why it was crediting the file reviewer opinions over that of a treating physician
collectively weigh in favor of finding that LINA’s denial of Calhoun’s claim was arbitrary and
capricious. See Judge v. Metro. Life Ins. Co., 710 F.3d 651, 663 (6th Cir. 2013) (discounting a
file review “when the plan administrator, without any reasoning, credits the file reviewer's
opinion over that of a treating physician”); see also Bennett, 514 F.3d at 555; see also Calvert,
409 F.3d at 296-97.
Other Evidence
In addition to the Trotter and Antonelli file reviews, in the letter terminating Calhoun’s
disability benefits, LINA also cited: the transferrable-skills analyses conducted shortly after
those reviews (from October 2012 and from June 2013); the third round of video surveillance in
2
Indeed, the record suggests that Dr. Boezi would not have agreed that Calhoun had the physical capacity
to work at a full-time job. Dr. Boezi stated in her treatment notes that Calhoun could not work in the job that he had
at Mars or in a desk job. In the most recent treatment note from Dr. Boezi in Calhoun’s medical file, Dr. Boezi
wrote that Calhoun was “having a hard time standing or sitting for too long[.] [H]e has to lay down. If he pushes
it[,] he can be down for a few days.”
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September 2012; and Dr. Boezi’s notes from Calhoun’s July 23, 2012, visit. All of this evidence
was either discredited or inadequate to explain the termination of Calhoun’s benefits.
First, the transferrable-skills analyses should be discounted because they were based
solely on the Trotter and Antonelli file reviews.3 Given that the file reviews were inadequate to
explain the termination, the transferrable-skills analyses based on the conclusions from those file
reviews must also be considered inadequate. Second, though Dr. Trotter and LINA attributed
significant weight to the video surveillance because it depicted Calhoun performing various
mobility tasks,4 the video surveillance is not inconsistent with Calhoun’s reported limitations on
his mobility, nor does it demonstrate that Calhoun is capable of working on a full-time basis.
As the district judge explained:
While some of the footage contradicts Plaintiff’s testimony regarding his
limitations, reliance on the footage in terminating benefits raises several
concerns. Indeed, in six days of surveillance, PhotoFax viewed a total of
less than thirty minutes of notable activity, that being Plaintiff standing
from lying, kneeling and sitting positions in a fluid manner without the use
of any assistive devices. Everything else observed is consistent with what
he reported—driving, laying down, using his arms, using a walker,
standing for ten to fifteen minutes. The fact that Plaintiff was able to
move fluidly over the course of less than thirty minutes provides little
support for a finding of capacity to perform full time light or sedentary
work.
Third, LINA’s citation to Dr. Boezi’s notes from Calhoun’s visit on July 23, 2012, is
misleading. LINA stated in its letter terminating Calhoun’s benefits that Calhoun reported
3
The second transferrable-skills analysis stated that it was “based solely on restrictions and limitations
cited by Dr. Trotter” in his peer review report and addendum. The third transferrable-skills analysis stated that it
was “based on the [Dr. Antonelli] peer review and [functional-capacity analysis] dated 03/12/2012.” The third
transferrable-skills analysis, however, did not give any indication that it reviewed the functional-capacity analysis:
it repeated only Dr. Antonelli’s summary of the functional-capacity evaluation and did not list the evaluation as one
of the documents that was reviewed in preparing the transferrable-skills analysis.
4
In explaining its termination of Calhoun’s benefits, LINA wrote to Calhoun: “While under surveillance,
you were active and were observed driving, sitting, standing, walking, laying on your back, kneeling, bending,
reaching, welding a mowing deck on a lawnmower, performing maintenance on a lawnmower, shopping and
conversing with individuals . . . . Of note, the only time you utilized a walker and/or carried a cane was at the
[functional-capacity analysis] and when you went shopping at Lowe’s.”
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“increased tingling and numbness in [his] bilateral lower extremeties” during that visit, but that
Dr. Boezi “recorded a normal exam and discussed with you that weight loss could help improve
your chronic back and leg pain.” However, in her notes from that visit, Dr. Boezi, did not
challenge Calhoun’s symptoms, nor did she indicate that Calhoun was capable of returning to
work. To the contrary, in her July 23 treatment notes, Dr. Boezi stated that Calhoun could not
“stand[] for too long” and concluded that Calhoun’s chronic leg and back pain was “not
improving.”
LINA argues that the March 2012 functional-capacity analysis also supported its decision
to terminate Calhoun’s benefits because it found that Calhoun was capable of working in a
sedentary capacity. The functional-capacity analysis, however, nowhere stated that Calhoun was
capable of working in a sedentary capacity; indeed, the evaluation concluded that Calhoun
“exhibit[ed] limited tolerance for sustained sitting or standing.” Although a physical-ability
assessment accompanying the functional-capacity analysis indicated that Calhoun could sit
“frequently: 2.5-5.5 hrs/day, 1/3-2/3 of the day,” Calhoun’s capacity to sit frequently does not
establish that he can work on a full-time basis. Indeed, the transferrable-skills analysis
completed shortly thereafter, which was based on the functional-capacity analysis and the
physical-ability assessment, concluded that there were no available jobs consistent with
Calhoun’s capacity because of his “demonstrated restriction to occasional standing and walking.”
In support of its decision to terminate Calhoun’s benefits, LINA also argues that Drs.
Vaughan and Stephenson, both of whom examined Calhoun, stated that Calhoun’s expressed
level of pain was not consistent with the objective medical evidence.5 In her notes from a
5
In its brief, LINA also included “Dr. Bowers” as an examining physician who “questioned [Calhoun’s]
failure to return to work and the extent of his self-reported limitations.” Presumably LINA means Dr. Powers, a
neurologist whom Calhoun saw for a consultation. However, Dr. Powers did not question Calhoun’s symptoms: he
stated only that the source of Calhoun’s pain was likely musculoskeletal rather than neurological.
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No. 15-3470, Calhoun v. Life Insurance Company of North America
January 2011 visit, Dr. Vaughan stated that she thought Calhoun should not use a motorized
scooter because he was “limiting his function more than he should be” and concluded that
Calhoun’s pain was “out of proportion to objective findings.” In June 2011, Dr. Stephenson
wrote, “Calhoun is reporting chronic low back pain and lower limb paresthesia, sometimes so
severe that he must use a cane or motorized scooter. Based on his clinical exam and diagnostic
workup I do not have an explanation for this, from a physical medicine perspective.”
Though these comments should be given some weight because Drs. Vaughan and
Stephenson did physically examine Calhoun, their comments are not inconsistent with the
conclusion that Calhoun’s condition precluded him from working a full-time job; rather, their
comments suggest only that Calhoun’s pain did not require a scooter. And, to the extent Drs.
Vaughan and Stephenson were expressing skepticism regarding Calhoun’s symptoms, the
medical record reflects extensive notes from Dr. Boezi that consistently report, even after Drs.
Vaughan and Stephenson’s examinations of Calhoun, that Calhoun could not sit or stand for
prolonged periods of time without experiencing numbness or pain.
In terminating Calhoun’s benefits, however, LINA failed to explain why it was crediting
these notes from Drs. Vaughan and Stephenson over those of Dr. Boezi. LINA’s attempted
reliance on Drs. Vaughan and Stephenson’s comments as justification for terminating Calhoun’s
benefits is even more troubling because the SSA judge found, based upon the same evidence,
that “the medical evidence of record supports [Calhoun’s] testimony . . . [and that] the claimant’s
subjective complaints and alleged limitations are persuasive . . . .”6 At the very least, LINA
should have given its reasons for rejecting the opinion of Dr. Boezi and the determination of the
ALJ. See Shaw, 795 F.3d at 548-49 (“A plan may not reject summarily the opinions of a treating
6
The administrative law judge did not discuss these notes from Drs. Vaughan and Stephenson in his
decision. However, it appears that both were included in the SSA file.
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No. 15-3470, Calhoun v. Life Insurance Company of North America
physician, but must instead give reasons for adopting an alternative opinion.”) (citation and
internal quotation marks omitted).
For similar reasons, the district court found “troubling several aspects of LINA’s review
of [Calhoun’s] claim,” but nevertheless found in favor of LINA because it felt “constrained by
the extremely deferential arbitrary and capricious standard.” This deferential standard of review,
however, does not serve as a “rubber stamp” for the plan administrator’s decision. See Glenn,
461 F.3d at 666. For the foregoing reasons, and particularly because of LINA’s conflict of
interest, we conclude that LINA’s termination of Calhoun’s disability benefits was not the result
of a deliberate, principled reasoning process that was supported by substantial evidence.
We therefore hold that LINA acted arbitrarily and capriciously when it denied Calhoun’s claim.
Remedy
Next, we must consider the appropriate remedy: whether to remand to LINA for
reconsideration of Calhoun’s claim or to award benefits directly to Calhoun. “[W]here the
problem is with the integrity of the plan’s decision-making process, rather than that a claimant
was denied benefits to which he was clearly entitled, the appropriate remedy generally is remand
to the plan administrator.” Cooper v. Life Ins. Co. of N. Am., 486 F.3d 157, 171 (6th Cir. 2007)
(quoting Elliott v. Metro Life Ins. Co., 473 F.3d 613, 622 (6th Cir. 2006)). However, where the
claimant clearly is entitled to disability benefits, we have awarded benefits to the claimant
without remand to the plan administrator. Shaw, 795 F.3d at 551; see also Cooper, 486 F.3d at
171. As we have explained, “Plan administrators should not be given two bites at the proverbial
apple where the claimant is clearly entitled to disability benefits. They need to properly and
fairly evaluate the claim the first time around; otherwise they take the risk of not getting a second
chance, except in cases where the adequacy of claimant’s proof is reasonably debatable.”
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No. 15-3470, Calhoun v. Life Insurance Company of North America
Cooper, 486 F.3d at 172. Accordingly, we have awarded the claimant benefits where objective
medical evidence clearly established the claimant’s disability, even in circumstances where the
plan administrator’s decision-making process “was unquestionably flawed.” Shaw, 795 F.3d at
551; see also Hayden v. Martin Marietta Materials, Inc. Flexible Benefits Program, 763 F.3d
598, 609 (6th Cir. 2014).
Here, objective medical evidence supported Calhoun’s disability. Calhoun’s
electromyography and MRI reflected meralgia paresthetica and degenerative disc disease at L5-
S1. The functional-capacity analysis, which “is objective evidence of a claimant’s disability,”
Shaw, 795 F.3d at 552 (internal quotation marks omitted), detailed Calhoun’s limited tolerance
for standing and sitting. The SSA judge, too, concluded that Calhoun was disabled because his
capacity for work was “so narrow.” Calhoun’s primary-care physician, Dr. Boezi, concluded
that Calhoun “can’t do a desk job due to the fact he can’t sit for any length of time.” All of
Calhoun’s other examining physicians—Drs. Vaughan, Dixon, Stephenson, and Powers—agreed
that Calhoun’s symptoms were consistent with meralgia paresthetica and degenerative disc
disease. The only credible evidence against finding that Calhoun was disabled is Drs. Vaughan
and Stephenson’s remarks questioning whether Calhoun’s pain required the use of a motorized
scooter. But, neither Dr. Vaughan nor Dr. Stephenson questioned Calhoun’s diagnoses, and
neither opined as to whether Calhoun could work at a sedentary occupation on a full-time basis.
Because LINA produced no credible evidence that undermined the objective medical evidence
that clearly established Calhoun’s disability, we remand this case to the district court for
reinstatement of Calhoun’s disability benefits from the date that they were terminated.
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No. 15-3470, Calhoun v. Life Insurance Company of North America
CONCLUSION
Because the record establishes that LINA acted arbitrarily and capriciously in denying
Calhoun long-term disability benefits, we REVERSE the district court’s judgment and
REMAND this case to the district court for entry of an order in conformity with this opinion.
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No. 15-3470, Calhoun v. Life Insurance Company of North America
ROGERS, Circuit Judge, dissenting.
I would affirm for the reasons given in the district court’s thorough and balanced opinion.
Even assuming that the district court on balance abused its discretion in this close case,
I would direct the district court to remand to LINA, so that LINA could more directly address the
SSA award, and so that LINA could obtain a further file review by a physician who has
physically examined Mr. Calhoun. Under our test for the proper remedy as described in Cooper
v. Life Ins. Co. of N. Am., 486 F.3d 157, 171 (6th Cir. 2007), the primary reasons for the
majority's finding of an abuse of discretion go to "the integrity of the plan’s decision-making
process," and not to show that Mr. Calhoun was “clearly entitled” to benefits.
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