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Michael W. Tolstedt v. Standard Insurance United States Company

August 3, 2012


The opinion of the court was delivered by: Carolyn S. Ostby United States Magistrate Judge


Plaintiff Michael W. Tolstedt ("Tolstedt") claims in this ERISA action that Defendant Standard Insurance Company ("Standard"), wrongfully terminated his long-term disability ("LTD") benefits. The following motions are pending:

(1) Tolstedt's Rule 52 Motion for Entry of Judgment (Dkt. 16); and

(2) Standard's Motion for Summary Judgment or, in the alternative, Motion for Trial by Administrative Record (Dkt. 19). Having reviewed the parties' arguments and the administrative record, the Court enters the following findings and recommendations.


Mr. Tolstedt is insured under a group disability policy (the "Policy") that Standard issued to his former employer, the Felt, Martin, Frazier & Weldon law firm. The parties agree that the Policy is governed by ERISA, 29 U.S.C. § 1001 et. seq.

On October 13, 2009, Tolstedt was admitted to the Billings Clinic Hospital and diagnosed with atherosclerotic coronary artery disease manifested by acute inferior wall myocardial infarction. AR 374. He underwent surgical stent procedures on October 13, 2009, and again on November 9, 2009. AR 373, 359.

On November 11, 2009, he filed a claim for long-term disability benefits, indicating that his illness was atherosclerosis caused by stress. AR 747. On February 5, 2010, Standard sent a letter to Tolstedt advising him that his claim was approved. AR 705. The letter advised that benefits became payable as of January 12, 2010, after the Benefit Waiting Period of 90 days, but did not state the specific basis for approval. The letter informed Tolstedt that Standard "will continue to monitor your medical condition or status" and that Standard would "monitor and document your continued eligibility for LTD Benefits...." AR 706-07.

On June 10, 2010, Standard sent Tolstedt another letter, advising him that Standard had reviewed information to determine the cause of his disability and had concluded:

The information in your file supports that you are Disabled by one or more conditions, including depression. Since depression is considered to be mental disorders, we will apply the Mental Disorders Limitation to your claim. * * * The Standard began paying you LTD Benefits for mental disorders on January 12, 2010. Therefore, the 24 month Maximum Benefit Period for mental disorders will end January 11, 2012. For your benefits to continue, you must remain Disabled and meet all other provisions of your Group Policy.

AR 199-200. Standard was relying on the section of the Policy governing disabilities subject to limited pay periods, in particular the section captioned: "Mental Disorders, Substance Abuse and Other Limited Conditions." AR 808. It provides:

Payment of LTD Benefits is limited to 24 months during your entire lifetime for a Disability caused or contributed to by any one or more of the following, or medical or surgical treatment of one or more of the following:

1. Mental Disorders;

2. Substance Abuse; or

3. Other Limited Conditions. * * * * Mental Disorder means any mental, emotional, behavioral, psychological, personality, cognitive, mood or stress-related abnormality, disorder, disturbance, dysfunction or syndrome, regardless of cause (including any biological or biochemical disorder or imbalance of the brain) or the presence of physical symptoms. Mental Disorder includes, but is not limited to, bipolar affective disorder, organic brain syndrome, schizophrenia, psychotic illness, manic depressive illness, depression and depressive disorders, anxiety and anxiety disorders.

The Policy requires payment of LTD benefits "according to the terms of the Group Policy." AR 795. Tolstedt contends that he is entitled to benefits under the policy's "Own Occupation Definition Of Disability" which provides:

During the Benefit Waiting Period and the Own Occupation Period you are required to be Disabled only from your Own Occupation.

You are Disabled from your Own Occupation if, as a result of Physical Disease, Injury, Pregnancy or Mental Disorder:

1. You are unable to perform with reasonable continuity the Material Duties of your Own Occupation; and

2. You suffer a loss of at least 20% in your Indexed Predisability Earnings when working in your Own Occupation. * * * * Own Occupation means any employment, business, trade, profession, call or vocation that involves Material Duties of the same general character as the occupation you are regularly performing for your Employer when Disability begins. In determining your Own Occupation, we are not limited to looking at the way you perform your job for your Employer, but we may also look at the way the occupation is generally performed in the national economy. If your Own Occupation involves the rendering of professional services and you are required to have a professional or occupational license in order to work, your Own Occupation is as broad as the scope of your license. AR 798-99.

Tolstedt contends that he has never been disabled by depression, but rather that his ongoing disability is coronary artery disease which permanently disables him from practicing law because his heart "can no longer withstand the rigors and stress of working as a trial attorney." Dkt. 7 at 8 (citing Dr. Sample's letter at AR 658). Dr. Sample's November 22, 2011 letter to Standard stated his opinion that Mr. Tolstedt's heart disease "permanently disabled [him] from ...

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