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Allen v. The Lilly Extended Disability Plan

United States District Court, S.D. Indiana, Indianapolis Division

June 4, 2018

ANGEL ALLEN, Plaintiff,
v.
THE LILLY EXTENDED DISABILITY PLAN, and ELI LILLY AND COMPANY LIFE INSURANCE AND DEATH BENEFIT PLAN, Defendants.

          ENTRY ON PLAINTIFF'S OBJECTIONS TO MAGISTRATE JUDGE'S ORDER ON MOTION TO COMPEL

          TANYA WALTON PRATT, JUDGE

         This matter is before the Court on Plaintiff Angel Allen's (“Allen”) Objections to the Magistrate Judge's Opinion and Order (Dkt 47). (Filing No. 48.) Allen filed a motion to compel Defendants Lilly Extended Disability Plan (the “EDL Plan”) and Eli Lilly and Company Life Insurance and Death Benefit Plan (collectively, “Lilly”), to comply with her discovery requests. Lilly opposed the discovery request arguing that Allen is not entitled to discovery in this ERISA matter. The Magistrate Judge agreed with Lilly and Allen appealed. For the reasons stated below, the Court denies Allen's appeal of the Magistrate Judge's decision.

         I. LEGAL STANDARD

         A district court may refer for decision a non-dispositive pretrial motion to a magistrate judge under Federal Rule of Civil Procedure 72(a). Rule 72(a) provides:

When a pretrial matter not dispositive of a party's claim or defense is referred to a magistrate judge to hear and decide, the magistrate judge must promptly conduct the required proceedings and, when appropriate, issue a written order stating the decision. A party may serve and file objections to the order within 14 days after being served with a copy. A party may not assign as error a defect in the order not timely objected to. The district judge in the case must consider timely objections and modify or set aside any part of the order that is clearly erroneous or is contrary to law.

         After reviewing objections to a magistrate judge's order, the district court will modify or set aside the order only if it is clearly erroneous or contrary to law. The clear error standard is highly differential, permitting reversal only when the district court “is left with the definite and firm conviction that a mistake has been made.” Weeks v. Samsung Heavy Indus. Co., Ltd., 126 F.3d 926, 943 (7th Cir. 1997).

         II. BACKGROUND

         Allen, a former employee of Eli Lilly and Company, was forced to stop working based on a medical condition, thereafter, she received benefits from the EDL Plan for eight years based on her disability. (Filing No. 47 at 2). In 2015, Lilly terminated Allen's disability benefits and Allen instituted this lawsuit appealing the denial of her claim for long-term disability benefits from Lilly's ERISA-governed benefit plans. (Filing No. 1.) The instant discovery dispute ensued over the parties' disagreement on whether Allen is entitled to discovery. The parties dispute the standard of review, the test for discovery, and whether Allen met that test. (Filing No. 47 at 1.) If Allen's claim is confined to the administrative record, then Allen is not entitled to any discovery.

         On August 2, 2017, the parties appeared for a telephonic status conference to discuss the Case Management Plan. At this conference, the parties disputed whether discovery is appropriate in this matter. Following the conference, the Court issued a preliminary finding: “The Court finds no basis for discovery, though [Allen] may serve discovery and file a motion to compel…”. (Filing No. 39.) On August 10, 2017, Allen served written discovery requests, and Lilly informed Allen that it would not be responding and cited case law in support of their position that she was not entitled to discovery (Filing No. 48 at 2). Allen made several additional requests that Lilly respond to her requests and on each occasion Lilly replied that it would not respond. Ultimately, Magistrate Judge Tim A. Baker (the “Magistrate Judge”) held a discovery conference, after which, the Magistrate Judge permitted Allen to file a motion to compel. (Filing No. 48 at 3.) On October 24, 2017, Allen filed a Motion to Compel (Filing No. 44).

         Allen contends that Lilly waived all discovery objections as Lilly did not comply with the specific requirements and procedures in making objections under Federal Rule of Civil Procedure 33(b)(4) when Lilly's counsel provided an email to Allen stating that they “do not plan to respond to your requests.” (Filing No. 48 at 4.) Following the telephonic status conference, in which the parties disputed whether discovery is appropriate in this matter, the Magistrate Judge issued a preliminary finding:

         “The Court finds no basis for discovery, though [Allen] may serve discovery and file a motion to compel if [Allen] truly believes discovery is permitted. [Allen] should carefully consider binding precedent limiting discovery in these cases.” (Filing No. 39 at 1.) On February 2, 2018, the Magistrate Judge denied Allen's Motion to Compel. (Filing No. 47 at 12.) On February 7, 2018, Allen filed an appeal of the Magistrate Judge's decision to this Court. (Filing No. 48).

         III. DISCUSSION

         A. The Magistrate Judge's Order

         The Magistrate Judge denied Allen's Motion to Compel finding she is not entitled to discovery because she has not overcome the arbitrary and capricious standard of review in ERISA cases in showing exceptional circumstances warranting discovery. (Filing No. 47 at 3-4.) The Order explains that the EDL Plan delegates discretionary authority to the Employee Benefits Committee (the “Committee”) to construe the terms and to determine benefits, which heightens the standard of review from the default de novo to arbitrary and capricious. Id. at 4. In a detailed analysis discussing recently developed Seventh Circuit case law in the ERISA context following the Supreme Court's decision in Met. Life Ins. Co. v. Glenn,554 U.S. 105 (2008), id. at 6, the Order notes that Allen's specific discovery requests fail to meet this ...


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