NEW YORK – A New York judge on Jan. 25 said he will hold a hearing to allow live testimony by the parties’ medical experts to assist in determining whether a claimant with heart disease is capable of returning to his occupation as a bond trader (Louis R. Napoli v. First Unum Life Ins. Co., No. 99CIV1329, S.D. N.Y.; 2005 U.S. Dist. LEXIS 1018; See February 2003, Page 5).
Louis Napoli worked as a bond trader until November 1996, when he had a heart attack and emergency bypass surgery. Napoli was insured under his employer’s group disability policy issued by First Unum Life Insurance Co. First Unum initially paid Napoli disability benefits but later terminated benefits, finding that he was able to return to work full time.
Napoli argued that he was totally disabled from returning to his job because the high level of stress could trigger another heart attack. Napoli submitted the affidavit of his treating physician, a Dr. Freilich, who said that Napoli’s cardiac disease is permanent and that the excessive stress of his occupation could cause another heart attack.
In its denial of benefits, First Unum relied on a memo signed by Freilich regarding a conversation he had with one of First Unum’s doctors in which he said he and Napoli decided that Napoli should not work and that if Napoli wanted to return to work, he would not have suggested otherwise. First Unum also relied on the opinion of Dr. Richard Nesto, a cardiologist, who concluded that Napoli performed well on the stress test and that the risk of cardiac event is higher when exposed to stress but that the absolute risk of a cardiac episode on a daily basis is so small it is not “quantifiable.”
Termination of Benefits
Napoli sued First Unum under the Employee Retirement Income Security Act for wrongful termination of benefits. Both parties moved for summary judgement. In January 2003, the U.S. District Court for the Southern District of New York granted summary judgement to First Unum, finding no abuse of discretion in denying benefits to Napoli. The Court of Appeals in October 2003 reversed, finding that there were materials of fact created by the difference of opinions between Freilich and Nesto.
Live Testimony
On remand, First Unum requested a grant of judgment on the administrative record, contending that there was no abuse of discretion on its part. Napoli requested that the court hear additional evidence on whether he is disabled under the policy.
Judge Gerard E. Lynch said additional evidence can be presented if there is good cause, such as a conflict of interest supplemented by other factors, citing Locher v. Unum Life Ins. Co. of America (389 F.3d 288, 293-296 [2d Cir. 2004]). Here, the judge said, the record was already expanded to include the affidavit of Freilich, which was not a part of the administrative record. He held that the best way to resolve the contradictory doctor opinions is to hear the live testimony of each witness, subject to cross-examination.
“Without attempting to consider the ‘good cause’ may mean in other contexts, it is clear to this court that, at least under these circumstances in which the Court faces a limited remand to determine a credibility issue, the conflict of interest on the part of the administrator and the fact that the Court of Appeals had already approved the expansion of the record to include an affidavit from the treating physician together constitute good cause under Locher to hear live testimony,” Judge Lynch held.
He said he will hold a hearing allowing each side’s medical witness to provide direct testimony, giving a brief explanation of their conclusion that Napoli can or cannot return to work. The judge said he will allow cross-examination of the witnesses and then make a determination besed on the testimony and the administrative record. A hearing date has not been scheduled.
Napoli is represented by Evan Schwartz and First Unum is represented by Louis M. Lagalante.
Evan S. Schwartz
Founder of Schwartz, Conroy & Hack
800-745-1755
ESS@schwartzlawpc.com