Disability Insurance Blog

Court Finds Reliance Standard to be Arbitrary and Capricious, Awards Claimant Benefits


Friday, March 24th, 2017

A Federal Judge in Colorado has awarded benefits to a claimant suffering from viral hepatitis and chronic cirrhosis of the liver, after determining that Reliance Standard failed to appropriately consider the claim and the medical evidence supportive of impairment. The claimant, who worked as the Director of Industry Marketing, was required to represent the company in meetings and public forums, support the company’s marketing efforts, speak at industry events, and exhibit leadership in promoting company products. The job required significant travel.

After suffering from these conditions for several years, the claimant ultimately ceased working in July 2012, and applied for disability benefits at that time. The medical basis of the claims was predicated upon symptoms of fevers, nausea, diarrhea, fatigue and inability to concentrate and manage stress. Reliance Standard determined that the claimant had now demonstrated and supported a total disability during the elimination period, and denied the claim. The claimant submitted an appeal of the denial, and the appeal was considered with Reliance Standard seeking a medical review of the records, without conducting any examination of the claimant.

Initially, the Court determined that Reliance Standard needed to clarify issues and consider things more fully, and remanded the case back to Reliance Standard. Following this remand, Reliance Standard had the same doctor perform a further review of the evidence. The second medical review reached the same conclusions as the initial medical review and benefits were not awarded to the claimant.

In considering the evidence in the further litigation, the Court determined that Reliance Standard’s determination that the claimant was not negatively impacted by his cognitive condition was not supported by substantial evidence. The Court found that Reliance Standard ignored the relevant medical evidence, as well as the support provided through third party support statements. The Court determined that Reliance Standard simply repeated its prior unsupported rationale, which the Court found to be “patently arbitrary and capricious.”

The Court also found that Reliance Standard failed to properly consider medical records reflecting fatigue, frequent nausea, severe leg swelling and suppressed immune system issues, despite the Court’s remand instructions from the first litigation. The Court further found that Reliance Standard’s determination was based upon a selective consideration of the medical evidence. Finally, the Court determined that Reliance Standard’s claim determination appeared to be based on “pure speculation”, as Reliance Standard failed to point to any medical evidence to address the issue of travel.

The Court thus awarded benefits to be paid to the claimant, and permitted counsel to file an application seeking legal fees.

Mason v. Reliance Standard