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Kearney v. Standard Ins. Co.

Kearney v. Standard Ins. Co.

United States Court of Appeals for the Ninth Circuit

April 12, 1998, Filed; May 19, 1998, Amended; June 3, 1998, Amended; August 3, 1998, Rehearing En Banc Granted and Opinion Withdrawn; September 24, 1998, Argued And Submitted - San Francisco, California ; April 28, 1999, Filed

Nos. 96-16539, 96-16701

Opinion

 [*1086]  OPINION

KLEINFELD, Circuit Judge:

This is an ERISA case. We voted to rehear it en banc to reconcile our decisions on the district court standard of review, whether de novo or abuse of discretion, of a plan administrator's decision. We also consider what record that the district court should consider.

Facts.

Mr. Kearney was a trial lawyer, and the managing partner of his law firm. As part of its benefits package, the firm bought a group disability insurance policy from Standard Insurance Company. The law firm was the policy owner. Under the policy, Standard promised to pay a percentage of an employee's predisability earnings, if the employee became disabled. For attorneys, the policy definition of "disability" says "you are only required to be DISABLED from your specialty in the practice of law."

One [**3]  day Mr. Kearney was in a judge's chambers with opposing counsel, when the judge told him he "looked like hell." When opposing counsel gave him exhibits to look at, he had trouble focusing and felt faint. Mr. Kearney was then 54 years old, with a history of heart trouble, so he went immediately to his physician. He had had a heart attack eleven years earlier, and an angioplasty four years earlier. This time, he was diagnosed with unstable angina pectoris, which basically means chest pain caused by inadequate oxygen supply to the heart. The arteries serving his heart were diseased and partially blocked. He was admitted to the hospital and coronary bypass surgery was performed, grafting in new blood vessels.

The parties disagree about how well Mr. Kearney recovered after surgery. The insurer takes the position that Mr. Kearney has recovered fully enough to practice in his specialty again, but Mr. Kearney's position is that he has not. Mr. Kearney returned to his law practice for a while, then retired. Mr. Kearney takes the position that since his surgery, fatigue, exhaustion, and memory and concentration problems, prevent him from practicing as a trial lawyer.

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175 F.3d 1084 *; 1999 U.S. App. LEXIS 8099 **; 99 Cal. Daily Op. Service 3020; 99 Daily Journal DAR 3930; 23 Employee Benefits Cas. (BNA) 1177

REX T. KEARNEY, JR., Plaintiff-Appellant, v. STANDARD INSURANCE COMPANY, Defendant-Appellee.

Subsequent History:  [**1]  Certiorari Denied November 1, 1999, Reported at: 1999 U.S. LEXIS 7086.

Prior History: Appeals from the United States District Court for the Eastern District of California. D.C. No. CV-95-00415-WBS/JFM. William B. Shubb, District Judge, Presiding.

Disposition: REVERSED and REMANDED.

CORE TERMS

district court, disability, satisfactory, memory, additional evidence, benefits, summary judgment, de novo, fiduciary, insurer, plan administrator, district judge, conferred, ambiguity, insurance company, trial lawyer, de novo review, written proof, discretionary, parties, tests, genuine issue, new evidence, cases, determinations, principles, Handbook, argues, abuse of discretion, deference

Business & Corporate Compliance, ERISA, Funding Requirements, Pension Plan Funding, Estate, Gift & Trust Law, Trustees, Duties & Powers, General Overview, Private Trusts Characteristics, Civil Procedure, Appeals, Standards of Review, De Novo Review, Pensions & Benefits Law, Judicial Review, De Novo Standard of Review, Governments, Fiduciaries, Civil Litigation, Causes of Action, Suits to Recover Plan Benefits, Labor & Employment Law, Disability Benefits, Scope & Definitions, Types of Disabilities, Fiduciaries, Summary Judgment, Entitlement as Matter of Law, Genuine Disputes, Damages, Costs & Attorney Fees, Discretionary Fees, Claim Procedures, Administrative Law, Administrative Record, Handling of Claims, Scope of Review