NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JAN 18 2019
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
JENNIFER KOTT, No. 17-16584
Plaintiff-Appellant, D.C. No. 5:16-cv-03678-BLF
v.
MEMORANDUM*
AGILENT TECHNOLOGIES, INC.
DISABILITY PLAN,
Defendant-Appellee.
Appeal from the United States District Court
for the Northern District of California
Beth Labson Freeman, District Judge, Presiding
Argued and Submitted December 21, 2018
San Francisco, California
Before: M. SMITH, NGUYEN, and BENNETT, Circuit Judges.
Plaintiff-Appellant Jennifer Kott appeals the denial of long-term disability
benefits under an employee benefit plan, Agilent Technologies, Inc. Disability Plan
(the Plan), administered by Sedgwick Claims Management Services, Inc.
(Sedgwick). Kott brought suit under the private right of action provision in the
Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132(a)(1)(B).
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Reviewing the Plan’s denial for abuse of discretion, the district court found in
favor of the Plan. We have jurisdiction pursuant to 28 U.S.C. § 1291, and,
reviewing the district court’s analysis de novo, Bergt v. Ret. Plan for Pilots
Employed by MarkAir, Inc., 293 F.3d 1139, 1142–43 (9th Cir. 2002), we affirm in
part and reverse in part.
In the ERISA context, an administrator abuses its discretion if its
“application of a correct legal standard was ‘(1) illogical, (2) implausible, or (3)
without support in inferences that may be drawn from the facts in the record.’”
Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666, 676 (9th Cir. 2011)
(quoting United States v. Hinkson, 585 F.3d 1247, 1262 (9th Cir. 2009) (en banc)).
It is also an abuse of discretion “if [an administrator] relies on clearly erroneous
findings of fact in making benefit determinations,” Pac. Shores Hosp. v. United
Behavioral Health, 764 F.3d 1030, 1042 (9th Cir. 2014) (quoting Taft v. Equitable
Life Assurance Soc’y, 9 F.3d 1469, 1473 (9th Cir. 1993)), or fails to explain why
the evidence supporting disability was insufficient to prove the claim. Saffon v.
Wells Fargo & Co. Long Term Disability Plan, 522 F.3d 863, 870–71 (9th Cir.
2008).
We point to three primary reasons why Sedgwick abused its discretion in
denying Kott’s claims: (1) Sedgwick did not provide Kott with a proper
explanation for why it denied her benefits; (2) Sedgwick failed to consider the
2 17-16584
simultaneous restrictions on Kott’s ability to sit and her ability to stand, which
likely precluded her from even part-time work; and (3) Sedgwick included an
erroneous factual finding in its denial letter that likely influenced its findings.
1. To qualify for long-term disability benefits under the Plan, Kott must show
that she “is continuously unable to perform any occupation for which he or she is
or may become qualified.” Sedgwick must determine whether Kott is “totally
disabled” based on “[o]bjective medical evidence,” defined as “evidence
establishing facts or conditions as perceived without distortion by personal
feelings, prejudices or interpretations.” When Sedgwick initially denied Kott’s
long-term disability claim on January 5, 2016, it pointed primarily to a lack of
objective medical evidence; specifically, that there was “no . . . tenderness to
palpation over the coccyx,” and “no gait alteration or any focal weakness in the
lower extremities noted on physical exam.” Kott’s supplemental medical records,
specifically records from Dr. Alan Galitz, appeared to provide the requested
information as noted in the February 16, 2016 and March 31, 2016 reports by Dr.
Woodley Mardy Davis—finding tenderness at the coccyx and noting significant
guarded gait. Yet Sedgwick denied Kott’s appeal on April 26, 2016, citing “no
substantive physical clinical findings or abnormalities to support your inability to
perform any occupation.”
It is unclear what Sedgwick meant by “substantive physical clinical findings
3 17-16584
or abnormalities.” In addition to the radiographs and medical records provided in
Kott’s initial application, Kott supplied additional records in her appeal. These
records included visits with Dr. Justin Low, her primary care physician, who
confirmed clinical diagnoses, continued issues with ambulation, and the need for
new disability work restrictions. The records also included visits with a pain
specialist, Dr. Galitz, to discuss continued back and foot pain and a completion of a
chronic pain management program. Overall, the doctors continued to report
chronic coccygeal pain and plantar fasciitis, making it difficult to both sit and
stand. Without additional explanation from Sedgwick as to the types of records or
findings needed, we find that Sedgwick did not “give [] ‘[a] description of any
additional material or information’ that was ‘necessary’ for her to ‘perfect the
claim,’ and to do so ‘in a manner calculated to be understood by the claimant.’”
Saffon, 522 F.3d at 870 (second alteration in original) (quoting 29 C.F.R.
§ 2560.503-1(g)(1)).
2. Next, Sedgwick never noted nor explained the incongruous restrictions
placed on Kott—that she may not have sat for longer than twenty minutes at a time
(as restricted by Drs. Lakshmi Madireddi and Low, two of the three physicians to
conduct physical exams of Kott), but also may not have stood at all due to plantar
fasciitis (as restricted by Dr. Martin Taubman, relying on Dr. Low’s findings). Dr.
Madireddi found that Kott could have worked part-time beginning November
4 17-16584
2015, for four hours a day, twenty hours a week, and should have been able to
work full-time by April 2016. Dr. Low generally agreed with Dr. Madireddi,
though he narrowed Kott’s restrictions for part-time work beginning December
2015 by two to three hours per day, with a maximum of one-hour standing time
and fifteen-to-twenty minutes of sitting at one time. Dr. Taubman, after
conducting a paper review of Kott’s medical records, found Kott “is now
documented to be unable to work any but seated duties from 02/10/2016 through
03/01/2016” and “is now documented to be unable to work her regular job.” This
leaves a period, between at least February 10, 2016 and March 1, 2016, during
which Kott was unable to work any sedentary job for more than twenty minutes.
Sedgwick likely considered these restrictions prior to the advancement of
her plantar fasciitis, when she was able to stand for one hour in twenty-minute
increments. At that point, the restrictions allowed for at least two-to-three hours of
part-time work with the assistance of a sit-to-stand workstation. However, with the
advancement of Kott’s standing restriction, it is illogical that Kott could have
worked any sedentary position from at least February 10, 2016 to March 1, 2016.
That Dr. Mardy-Davis reached the same conclusion as Sedgwick does not support
Sedgwick’s findings. Unlike Sedgwick, Dr. Mardy-Davis was not provided with a
podiatrist’s recommendation on Kott’s standing restriction. Dr. Taubman’s report
5 17-16584
was available to Sedgwick, and the incongruous nature of these restrictions
warranted consideration.
3. Lastly, it is undisputed that Sedgwick erroneously stated that Dr. Taubman
teleconferenced with Dr. Low, who advised that he did not treat Kott for any foot-
related problems. The district court dismissed this erroneous finding based on the
conclusion that it was not the sole basis for Sedgwick’s outcome. We are not
convinced Sedgwick did not rely on this finding.
Sedgwick’s denial letter later stated, “From a Podiatry and Pain Medicine
perspective, the medical documentation contains no substantive physical clinical
findings or abnormalities to support your inability to perform any occupation as of
February 10, 2016.” Yet medical records from Dr. Low and his referrals were
precisely the information that compelled Dr. Taubman to amend his
recommendation that Kott be limited to seated duties through March 1, 2016. Dr.
Taubman found the additional records detailing continued physical therapy and
foot pain substantial enough to support a temporary, yet complete, restriction on
standing. By disregarding Dr. Low’s treatment history based on the mistaken
belief that he did not treat her for foot-related problems, Sedgwick never
considered how Kott would be able to work part-time at a sit-to-stand station when
she could not stand, and could not sit for longer than twenty minutes at a time.
6 17-16584
4. Additionally, we conclude that the district court properly excluded Exhibits
13, 16, and 17, as well as the decisions by the Social Security Administration. It is
inappropriate to rely on evidence not considered by the plan administrator when
denying an appellant’s claim, and no procedural error supports consideration of
this outside evidence. See Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955, 970
(9th Cir. 2006).
We AFFIRM the district court’s decision to exclude evidence outside of
Sedgwick’s record at the time of its decision. We REVERSE and REMAND to
the district court to send the case back to Sedgwick with instructions to reevaluate
its long-term disability determination in light of our ruling.1
AFFIRM in part, REVERSE and REMAND, in part. Each party shall
bear its own costs.
1
Because our disposition moots the remaining issues on appeal, we need not
address them.
7 17-16584
FILED
JAN 18 2019
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
Kott v. Agilent Technologies, Inc., 17-16584
BENNETT, Circuit Judge, concurring in part and dissenting in part:
I agree with my colleagues that the district court properly excluded certain
exhibits and Social Security Administration decisions as extra-record evidence.
As for the merits of Kott’s claim, I would affirm in part and reverse in part
the district court’s decision to uphold Sedgwick’s denial of benefits, and I would
instruct the district court to remand the case back to Sedgwick for reconsideration
only as to the period of February 10, 2016 to March 1, 2016.
We must review Sedgwick’s interpretation of the Plan’s “any occupation”
clause under the deferential abuse-of-discretion standard. Saffon v. Wells Fargo &
Co. Long Term Disability Plan, 522 F.3d 863, 866 (9th Cir. 2008). This standard
“does not mean that the plan administrator will prevail on the merits,” but it does
mean that we will not disturb Sedgwick’s interpretation if it is reasonable.
Conkright v. Frommert, 559 U.S. 506, 521 (2010). We require plan administrators
to engage in a “meaningful dialogue” with claimants, Saffon, 522 F.3d at 866, but
once that requirement is met, we do not also require that plan administrators
provide a meticulous statement of reasons for denying benefits. See Pac. Shores
Hosp. v. United Behavioral Health, 764 F.3d 1030, 1042 (9th Cir. 2014)
1
(explaining that “we will uphold a plan administrator’s decision if it is grounded in
‘any reasonable basis,’” in light of “all the circumstances of the case” (citations
omitted)); cf. Anderson v. Suburban Teamsters of N. Ill. Pension Fund Bd. of
Trustees, 588 F.3d 641, 649 (9th Cir. 2009) (“A plan administrator abuses its
discretion if it renders a decision without any explanation . . .” (emphasis added)).
I agree with the majority that Sedgwick abused its discretion by not offering
any explanation for how Kott could work despite her incongruous sit-stand
restrictions during the period of February 10, 2016 to March 1, 2016. I also agree
that Sedgwick failed to engage in a “meaningful dialogue” with Kott with respect
to this period, as Sedgwick did not explain what further evidence Kott could have
provided to demonstrate her total disability. Saffon, 522 F.3d at 866.
I disagree, however, with the majority’s conclusion that Sedgwick abused its
discretion by denying Kott’s claim for benefits after March 1, 2016. In its appeal
denial letter, Sedgwick accurately noted that Dr. Taubman restricted Kott to
sedentary work from February 10, 2016 to March 1, 2016. Kott argues that Dr.
Taubman’s opinion was based on the most recent physical therapy notes available
to him, and thus Dr. Taubman was not opining that Kott would in fact be able to
work after March 1, 2016. But it was Kott’s burden to establish her prima facie
eligibility for benefits under the “any occupation” standard after March 1st. See
Estate of Barton v. ADT Sec. Servs. Pension Plan, 820 F.3d 1060, 1065–66 (9th
2
Cir. 2016). In addition, the March 1st end date is roughly consistent with Dr.
Low’s November 23, 2015 opinion that, based on Kott’s coccyx injury and plantar
fasciitis, she would be totally disabled until at least February 23, 2016.
On this record, it was reasonable for Sedgwick to deny benefits under the
“any occupation” standard for the period of time after March 1, 2016. And
Sedgwick’s explanation—that “the medical documentation contains no substantive
physical clinical findings or abnormalities to support [Kott’s] inability to perform
any occupation as of February 10, 2016”—was logical as to the period of time after
March 1st. The majority acknowledges as much, concluding that “it is illogical
that Kott could have worked any sedentary position from at least February 10,
2016, to March 1, 2016.” Maj. at 5 (emphasis added). The majority fails to
explain how Sedgwick’s decision was illogical after that period of time. Rather
than properly tailor its remand, the majority provides a remedy that, in my view,
will lead to wholly unnecessary litigation for the period of time after March 1,
2016. I believe we should remove that possibility.
Finally, I disagree with the majority that Sedgwick relied on a clearly
erroneous factual finding. Even assuming that Sedgwick’s reference to the
teleconference between Dr. Low and Dr. Taubman was clearly erroneous,1 there is
1
Sedgwick referenced a teleconference between Dr. Taubman and Dr. Low in
which Dr. Low “advised that he did not treat [Kott] for any foot related problems.”
I am not convinced this reference was erroneous, let alone clearly erroneous. Dr.
3
a reasonable basis to conclude that Sedgwick did not rely on it. Rather than
disregard Kott’s foot pain because of the teleconference, Sedgwick in fact
recognized Dr.’s Taubman opinion—which was based on Dr. Low’s diagnosis—
that Kott was restricted to seated work from February 10, 2016 to March 1, 2016.
Nor was Dr. Taubman’s opinion at odds with Sedgwick’s ultimate conclusion that,
“[f]rom a Podiatry and Pain Medicine perspective,” Kott was not disabled under
the “any occupation” standard. Indeed, there is a reasonable basis to conclude that
Sedgwick instructed the vocational expert that Kott was restricted to sedentary
work because of her foot pain.
For these reasons, I would affirm the district court’s judgment in favor of
Sedgwick as to the period after March 1, 2016. I agree, however, that the district
court properly excluded extra-record evidence, and that the case should be
remanded to Sedgwick for reconsideration of benefits for the period of February
10, 2016 to March 1, 2016.
Taubman in fact reported that either Dr. Low or Dr. Lai (the report mistakenly
references both doctors) advised that “he did not treat Kott for foot-related
problems.” Dr. Taubman also reviewed Dr. Low’s examination reports and
summarized that Dr. Low “did not specifically treat the foot condition” and again
that “although foot pain was included in [Kott’s] diagnoses it was not specifically
treated.” Dr. Taubman’s supplemental report relied on medical records from Dr.
Low, but those records again reflected Dr. Low’s diagnosis rather than his direct
treatment of Kott’s foot pain.
4