A disability lawyer recently filed a lawsuit against the Liberty Life Assurance Company of Boston (Liberty Life) at District Court for the Eastern District of Kentucky. In Rita Dirks Vs Liberty Life Assurance Company Of Boston, The Charles Schwab Corporation Long Term Disability Plan And The Charles Schwab Corporation, it was alleged by the plaintiff Rita Dirks that Liberty Life had violated the provisions of the Employee Retirement Income Security Act of 1974 (ERISA) in the handling of her claim for long term disability (LTD) benefits.
The Alleged Facts Of The Case
The plaintiff was formerly an employee of the Charles Schwab Corporation. She participated in an “employee welfare benefit plan” called the Charles Schwab Corporation Long Term Disability Plan (the “Plan”) which was funded by Liberty Life. The Charles Schwab Corporation acted as the Plan Administrator and Plan Sponsor while Liberty Life determined eligibility for benefits under the Plan, and was/is the party responsible for paying benefits to claimants who are found disabled under the Plan. Under the terms of the Plan, Liberty Life agreed to provide the plaintiff with LTD benefits in the event that the plaintiff became disabled as defined in the LTD portion of the Plan.
The plaintiff later stopped working due to a disability. In the lawsuit, it was claimed that the plaintiff remained covered under the Plan while being disabled. The plaintiff contended that she had been and still is disabled as defined by the terms of the plan. Despite being disabled and providing with evidence of the Plaintiff’s permanent disability, the plaintiff alleged that Liberty Life had refused to pay LTD benefits to the plaintiff under the Plan.
The plaintiff also stated in the lawsuit that timely appeals were made to Liberty Life regarding its decision to deny the plaintiff’s claim for LTD benefits. Despite exhausting all her administrative remedies, none of the plaintiff’s appeals were successful and Liberty Life continued to deny the plaintiff her claim for LTD benefits.
Alleged Legal Basis for the Lawsuit Filed by Disability Attorney
As mentioned earlier, the plaintiff alleged that despite being disabled as defined under the terms of the plan, Liberty Life had failed to pay disability benefits due to her under the LTD portion of the Plan. The plaintiff argued that the failure to provide benefits constituted a breach of the terms of the plan. Specifically, the plaintiff alleged that Liberty Life’s:
- Decision to deny disability benefits was wrong under the terms of the Plan.
- Decision to deny disability benefits and decision-making process were arbitrary and capricious.
- Decision to deny disability benefits was not supported by substantial evidence in the record.
- Decision-making process did not provide a reasonable opportunity to the Plaintiff for a full and fair review of the decision denying the claim as is required under ERISA.
- Appellate procedures did not provide the plaintiff a full and fair review.
Relief Sought By The Plaintiff Through The Court
The plaintiff argued that Liberty Life had failed in its fiduciary duty towards the plaintiff with its actions and this had resulted in the plaintiff suffering damages. As such the plaintiff is seeking from the Court the following relief:
- An award of damages in the amount equal to the disability income benefits to which she was entitled though the date of judgment, for unpaid benefits pursuant to the provision under ERISA.
- Prejudgment and postjudgment interest.
- An order compelling Liberty Life to pay continuing benefits in the future so long as the plaintiff remains disabled under the terms of the Plan;
- An order compelling the Plan Administrator to provide benefits under any other employee benefit plan in which the plaintiff was enrolled and may be entitled to benefits
- A finding that the plaintiff is disabled under the terms of the Plan
- An award of reasonable attorney fees and costs.
- Any other relief that the Court deems just and proper.