:: Second Circuit Vacates Judgment For Plan, Suggests Appointment Of Counsel

Given that Douglas is currently pursuing her claims pro se, and given that our remand order requires consideration of a recent and complicated Supreme Court decision involving ERISA, it may be advisable for her to have the assistance of counsel. We therefore instruct the district court to consider appointing counsel to represent Douglas in these proceedings if she desires such representation. Cf. McEachin v. McGuinnis, 357 F.3d 197, 205 (2d Cir. 2004); Gayle v. Gonyea, 313 F.3d 677, 684 (2d Cir. 2002) (citing 28 U.S.C. § 1915(e)(1)).

Douglas v. First Unum Life Ins. Co., 07-1082-cv, 2008 U.S. App. LEXIS 21246 (2d Cir.) (October 7, 2008) (unpublished)

The federal courts have continued to adapt the MetLife v. Glenn decision into their approach in an ad hoc and unpredictable fashion.  To be sure, several courts have seen the case as requiring little change.  Others, such as the Second Circuit in Douglas, reached conclusions that reveal a new approach to old issues.

In this unpublished decision, the Second Circuit reversed and vacated a district court judgment for the disability carrier where the claimant had failed to submit her claim within the time required by the policy.

The parties agree that First Unum’s Late Notice Claim Procedures required Douglas to file her claim by May 26, 2003, which she did not do. The procedures further provided that “if the claim is submitted [*2] after the time limit set forth in the policy, [First Unum] must evaluate whether the claimant’s delay was unreasonable.” Douglas did not file until October 2003, well past the deadline, but offered various reasons for the delay. First Unum investigated Douglas’s claim and the reasons she gave for her late filing–including her assertion that she had relied on the advice of her attorney–and determined that “it was possible” for Douglas to have provided it with proof of her claim within the time limit.

After First Unum denied Douglas’s claim and her subsequent administrative appeal, she later filed a complaint against First Unum under ERISA, alleging that First Unum had unreasonably and arbitrarily and capriciously denied her request for benefits.  The district court granted First Unum’s motion for summary judgment.

Nothing remarkable can be found in the proceeds through this stage.  But then the Second Circuit takes a look at the Glenn holding on appeal and notes the conflict issue:

On June 19, 2008, after the District Court granted summary judgment and dismissed Douglas’s complaint, the Supreme Court rendered its decision in Metropolitan Life Insurance Company v. Glenn, 128 S. Ct. 2343, 171 L. Ed. 2d 299 (June 19, 2008). The Court noted that, as in the case before us here, “[o]ften the entity that administers the [ERISA] plan, such as an employer or an insurance company, both determines whether an employee is eligible for benefits and pays benefits out of its own pocket.” Id. at 2346. The Court held that “this dual role creates a conflict of interest; that a reviewing court should consider that conflict as a factor in determining whether the plan administrator has abused its discretion in denying benefits; and that the significance of the factor will depend upon the circumstances of the particular case.” Id.

Not only did the Court find a conflict of interest, but it also observed that the claimant may need the benefit of appointed counsel.

In light of Glenn and the fact that under the policy before us First Unum “both determines whether an employee is eligible for benefits and pays benefits out of its own pocket,” Glenn, 128 S. Ct. at 2346, we VACATE and REMAND to the District Court to consider whether it applied the appropriate standard in dismissing Douglas’s claims.

. . .

Given that Douglas is currently pursuing her claims pro se, and given that our remand order requires consideration of a recent and complicated Supreme Court decision involving ERISA, it may be advisable for her to have the assistance of counsel. We therefore instruct the district court to consider appointing counsel to represent Douglas in these proceedings if she desires such representation. Cf. McEachin v. McGuinnis, 357 F.3d 197, 205 (2d Cir. 2004); Gayle v. Gonyea, 313 F.3d 677, 684 (2d Cir. 2002) (citing 28 U.S.C. § 1915(e)(1)).

Note: The cases cited by the Court involved the appointment of counsel in in forma pauperis proceedings.  This seems a bit unusual, but interesting, in the context of an ERISA case.  See 28 U.S.C. § 1915 (e)(1), cited in Gayle.

Adminstrative Law Paradigm – The solicitude of the Court for the rights of unrepresented parties is reminiscent of  administrative law cases.   As I have contended in the past, Glenn offers courts a chance to take a closer look at administrative law cases concerned with procedural fairness.  See, e.g., Brock v. Chater, 84 F.3d 726, 728 (5th Cir. Tex. 1996). The Court notes that:

The ALJ owes a duty to a claimant to develop the record fully and fairly to ensure that his decision is an informed decision based on sufficient facts. . . When a claimant is not represented by counsel, the ALJ owes a heightened duty to “scrupulously and conscientiously probe into, inquire of, and explore for all relevant facts.” Id.