In a case not handled by Attorneys Dell & Schaefer, a Prudential Claimant has lost her right to sue after being denied disability benefits. In a recent decision by a Circuit Court Judge in the United States District Court for the Western District of North Carolina, a disabled woman’s lawsuit against Prudential was dismissed because she unfortunately waited too long to file a lawsuit.
The claimant was previously employed by Thermo Fisher Scientific. As an employee of Thermo Fisher Scientific, she was covered under Thermo Fisher’s short term disability (STD) and long term disability (LTD) plans. These plans were administered by Prudential Life Insurance Company of America.
On March 16, 2010, the claimant became disabled and applied for and was ultimately approved for STD benefits through April 20, 2010. On June 21, 2010, Prudential denied both STD and LTD eligibility after May 25, 2010. The claimant filed a timely appeal on July 10, 2010, but that appeal was denied on August 9, 2010. A second appeal was filed on September 1, 2010, but this appeal was also denied by way of a letter dated February 2, 2011.
Unfortunately for the claimant, with the administrative remedies exhausted, her only remaining avenue to seek compensation under the STD and LTD plans was to file an ERISA lawsuit in federal court.
For unknown reasons, the former Thermo Fisher employer waited until February 11, 2014 to file her lawsuit.
Shortly after the lawsuit was filed, Prudential filed a Motion to Dismiss the Plaintiff’s (claimant’s) Complaint. In its motion, Prudential argued that the claimant’s lawsuit was untimely as she waited beyond the time limit under the STD and LTD plans to file a lawsuit.
Long Term Disability Claim
The Long Term Disability Plan stated that “(w)ritten notice of a claim should be sent within 30 days after the date your disability begins. However, you must send Prudential written proof of your claim no later than 90 days after your elimination period ends.” Additionally, the LTD Plan states that you “can start legal action regarding your claim 60 days after proof of claim has been given and up to 3 years from the time proof of claim is required…”. It must be noted that the elimination period under Thermo Fisher’s LTD Plan is 180 days.
After receiving the Motion to Dismiss, the Court noted that “a reasonable contractual limitations period for a suit under ERISA may start to run even during a period when the claimant must still be pursuing administrative remedies prior to filing suit.” The Judge seems to find this fair as the “parties contracted for a three-year limitations period for filing suit under ERISA with regard to long-term disability.” The Court found this three-year period reasonable.
The Court then found that “the three year contractual limitations period applicable to the Plaintiff’s filing suit for LTD benefits under ERISA commenced to run at the end of the 90” day period to provide proof of loss. The Court continued that the “last day of the 90 day period for the Plaintiff to offer proof of claim for LTD benefits was December 11, 2010.” This date was calculated using the 180 day elimination period plus the 90 day period to provide proof of loss. The Court therefore concluded that “the three-year contractual limitations period for the Plaintiff to file suit under ERISA for LTD benefits expired on December 11, 2013.” The Court noted that the Claimant did not file this lawsuit until February 11, 2014. Therefore, the Court held that the claimant was time barred by the contractual limitations period from claiming LTD benefits in this case.
Short Term Disability Claim
The Short Term Disability Plan stated that “(n)otice of a claim should be sent within 30 days after the date your disability begins. However, you must send written proof of your claim no later than 90 days after your elimination period.” The STD Plan did not provide time limits for legal proceedings as the LTD Plan did.
With regards to the STD claim, because the policy offered no time limit to bring legal proceedings, the Court ultimately made a similar finding to the LTD claim, albeit through a different reasoning process.
The Court first noted that there “is no particular statute of limitations for a cause of action under ERISA.” Thus the Court “must look to the most analogous state statute of limitations.” Since this case was brought in North Carolina where the Plaintiff resided, the Court applied “North Carolina’s three year breach of contract statute of limitations to the STD claim.” The Court further noted that a “claimant for benefits under ERISA ‘must both pursue and exhaust plan remedies before gaining access to the federal courts.'” The court also noted that “the statute of limitations… does not ordinarily begin to run until the statutorily mandated internal appeals process is exhausted.”
The Court found that the North Carolina three-year statute of limitations did not begin running until the second (and final) appeal was denied on February 2, 2011 when the claimant’s administrative remedies were finally exhausted. Thus, the statute of limitations for the STD claim expired on February 2, 2014. As the claimant did not file suit until February 11, 2014 (9 days after that time limit), the Court ruled that the claimant was “barred by the statutory limitations period from filing suit to obtain STD benefits in this case.”
Why Does This Decision Matter?
This decision can serve as an educational tool for those needing to sue Prudential or any disability insurance provider. Calculating the time period in which a claimant has a right to sue over a denial of disability benefits is a very meticulous and confusing process. It is often better to file the lawsuit as soon as possible rather than let a Court play a calculation game to see if you are allowed to proceed.
If you have been denied Long Term Disability benefits by Prudential or any disability insurance provider and you need to sue, please do not wait any longer and please contact Attorney Alexander Palamara or any attorney at Dell & Schaefer. We are always available for a free consultation.