United States District Court, S.D. Indiana, Indianapolis Division
ORDER ON PENDING MOTIONS
J. DINSMORE UNITED STATES MAGISTRATE JUDGE.
matter comes before the Court on Plaintiff's Motion for
Stay. [Dkt. 28.] For the reasons set forth below,
the Court DENIES Plaintiffs motion.
applied for short term disability ("STD") benefits
that are provided to Defendant's employees. Defendant
approved and paid Plaintiff STD benefits from January 26,
2016 through September 12, 2016. [Dkt. 1 at 2.] Defendant
denied Plaintiff's claim for additional STD benefits
after September 12, 2016. rDkt. 28; Dkt. 30.1 Plaintiff
appealed Defendant's decision and on January 25, 2017
Defendant denied Plaintiff's appeal. [Dkt. 1 at 2.]
March 29, 2017, Plaintiff brought this action alleging
Defendant violated the Employee Retirement Income Security
Act of 1974 ("ERISA") by prematurely terminating
her claim for STD benefits. [Dkt. 1.] At around the same time
or shortly thereafter,  Plaintiff submitted to Defendant a
claim for long term disability ("LTD") benefits
related to the same disability and medical conditions she
alleges support her claim for STD benefits. [Dkt. 28.]
Defendant denied Plaintiff's LTD benefits claim and the
claim is pending in Defendant's appeal process.
[Id.] Plaintiff now seeks to stay this matter for
120 days to await the outcome of the LTD benefits appeal.
argues that a stay would avoid piecemeal litigation of the
STD benefits and LTD benefits claims because assuming
Defendant denies her LTD benefits claim, Plaintiff can
include that denial within this lawsuit and the Court will be
able to adjudicate both claims at the same time. [Dkt. 28.]
In response, Defendant argues that if Defendant denies
Plaintiff's LTD benefits claim, Plaintiff would not be
able to simultaneously litigate her STD benefits and LTD
benefits claims because the relevant plan terms require
participants to first exhaust fifty-two (52) weeks of STD
benefits before being considered for LTD benefits. [Dkt. 30
at 3.] Defendant maintains that it is undisputed Plaintiff
did not meet this requirement. [Id.] Moreover,
Defendant notes that because Plaintiff did not receive
fifty-two (52) weeks of STD benefits, the claims
administrator has not even considered whether there was
sufficient evidence to satisfy other required criteria.
[Id.] Thus, Defendant argues that even if Plaintiff
prevails on her STD benefits claim and exhausts the fifty-two
(52) weeks of STD benefits, the Court would still be required
to remand consideration of the LTD claim back to the claims
administrator. [Id. at 4.]
reply, Plaintiff argues that Defendant's LTD denial
letter dated May 25, 2017 only stated that it denied
Plaintiff LTD benefits because she did not first exhaust the
required fifty-two (52) weeks of STD benefits. [Dkt. 31 at
2-3.] Thus, under ERISA, Defendant is not allowed to generate
new reasons for the denial of her LTD benefits claim besides
the sole reason stating in the May 25, 2017 correspondence.
[Id.] Consequently, Plaintiff argues that if the
Court finds that Defendant prematurely terminated her STD
benefits claim, Defendant's basis for denying her LTD
benefits claim will become moot and Plaintiff will be
entitled to the LTD benefits. [Id. at 5.]
power to stay proceeding is incidental to the power inherent
in every court to control the disposition of the causes on
its docket with economy of time and effort for itself, for
counsel, and for litigants." Texas Indep. Producers
& Royalty Owners Ass'n v. E.P.A., 410 F.3d 964,
980 (7th Cir. 2005) (quoting Landis v. N. Am.
Co., 299 U.S. 248, 254 (1936)). "How this can best
be done calls for the exercise of judgment, which must weigh
competing interests and maintain an even balance."
Landis, 299 U.S. at 254-55. "The proponent of a
stay bears the burden of establishing its need."
Clinton v. Jones, 520 U.S. 681, 708 (1997).
argues that if she prevails on her STD benefits claim and
exhausts the fifty-two (52) weeks of STD benefits, she would
be automatically eligible to receive LTD benefits. Plaintiff
asserts that under ERISA, the initial denial notification
must set out every reason for a decision denying benefits.
Given the fact that Defendant's LTD denial letter dated
May 25, 2017 only stated that it denied Plaintiff LTD
benefits because she did not first exhaust the required
fifty-two (52) weeks of STD benefits, Plaintiff argues that
Defendant is prohibited from generating new reasons for its
denial of Plaintiff s LTD benefits claim. Defendant argues
that even if Plaintiff exhausts the fifty-two (52) weeks of
STD benefits, the Court would still be required to remand
consideration of the LTD claim back to the claims
administrator to determine whether Plaintiff meets other
required criteria. The Court addresses the parties'
arguments in turn.
sets certain minimum requirements for procedures and
notifications when a plan administrator denies a claim for
benefits." Zuckerman v. United of Omaha Life Ins.
Co., No. 09- CV-4819, 2011 WL 2173629, at *3 (N.D. 111.
May 31, 2011). In a nutshell, ERISA requires the plan
administrator to provide specific reasons for the denial of
the claim and to give the claimant an opportunity for a
"full and fair review." Halpin v. W. W.
Grainger, Inc., 962 F.2d 685, 688 (7th Cir.
1992). Section 1133 of ERISA provides:
accordance with regulations of the Secretary, every employee
benefit plan shall-
(1) Provide adequate notice in writing to any participant or
beneficiary whose claim for benefits under the plan has been
denied, setting forth the specific reasons for such denial,
written in a manner ...