his appeal has generated thorny questions involving the appropriate standard of judicial review under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461. It is now before us for a second time. Our initial encounter produced a proliferation of views: three separate opinions from the three panelists, each of which grappled with the methodological problem facing a reviewing court in regard to an ERISA benefit-denial decision made by a plan administrator operating as both adjudicator and payer of such claims.

Denmark v. Liberty Life, No. 05-2877 (1st Cir.) (May 6, 2009)

This is a highly significant opinion in the First Circuit which is, happily, a very interesting opinion to read.  It is also one of those opinions that reflects a difference in judicial approach by judges on the same panel.  

The majority opinion casts a long view toward the horizon of future cases.  The concurring opinion reflects a more skeptical view of the ability and even the propriety of attempts to monolithically fashion a whole tapestry out of such a short bolt of cloth. (see my Note below).


The factual history is eventful but may be succinctly stated.  

Liberty first denied a disability claim essentially upon a nurse’s opinion as against three physicians, and then upon a contract partner review as against an IME that favored the plaintiff.  

The district court permitted the plaintiff to conduct limited discovery anent Liberty’s relationship with NMR and its corresponden physicians as part of an effort to show that Liberty’s actions were influenced by a conflict of interest.

Bias Issue

The inquiry into bias revealed that:

Liberty . . . had paid upwards of $2,000,000 to NMR physicians between 2001 and 2003, and identified 1,204 files that it had referred to NMR during that interval. But Liberty refused, on burdensomeness grounds, to answer interrogatories regarding the proportion of those files in which claims ultimately had been allowed.

Nonetheless, the district court “found no significantly probative evidence that the conflict had in fact influenced Liberty’s decisionmaking.”   The district court “opined that a bare structural conflict, in and of itself, did not warrant the application of a less deferential standard of review.”

Thus, the court proceeded to find the denial of LTD benefits supported by substantial evidence and, thus, within the plan administrator’s discretion.  

On Appeal

On appeal, the First Circuit vacated the district court’s holding for the carrier, with this comment on its precedent in view of Glenn:

To sum up, our preexisting standard of review is largely but not entirely harmonious with Glenn. While the refinements are modest, this case is hair’s-breadth close. Given that precarious balance, even a slight adjustment in the mix of factors or in the weight of a single factor may make a decisive difference.

Hence, we think it incumbent upon us to remand the case and permit the district court, in the first instance, to reconsider its decision in light of Glenn.

Remand will allow full consideration of how heavily this conflict should weigh in the balance. That is highly desirable because, in performing a multi-factor analysis, “any one factor will act as a tiebreaker when the other factors are closely balanced.” Glenn, 128 S. Ct. at 2351. We leave this reweighing to the district court, and intimate no view as to the outcome.

Procedural Comments

The opinion then proposes the following developments in future cases:

In future cases, plan administrators, aware of Glenn, can be expected as a matter of course to document the procedures used to prevent or mitigate the effect of structural conflicts. That information will be included in the administrative record and, thus, will be available to a reviewing court. Conflict-oriented discovery will be needed only to the extent that there are gaps in the administrative record. If, say, the plan administrator has failed to detail its procedures, discovery may be appropriate, in the district court’s discretion. Otherwise, discovery normally will be limited to the clarification of ambiguities or to ensuring that the documented procedures have been followed in a particular instance.

On Remand

On remand, the Court had two suggestions:


Liberty did not include in the administrative record any evidence with respect to its conflict-ameliorating procedures. Given these temporally awkward circumstances, we think that the district court, in its discretion, may wish to afford the parties a limited opportunity to flesh out the record (even if that entails further, appropriately circumscribed, discovery).

And, more practically:


One final point comes to mind. This may be an appropriate time for the parties seriously to consider settlement. The district court would be wise to explore that possibility.

Note:  The concurring opinion reminds readers of how far the majority opinion strays from the matter at hand:

 I agree with my colleagues that the focal point of this appeal was the standard of judicial review in our circuit in the wake of Glenn. I also agree with my colleagues that we should remand to the district court so that it can evaluate the impact of Glenn on the merits of Denmark’s case. However, I am concerned that the majority’s general comments about the appropriate scope of discovery post-Glenn reflect a particularly hostile attitude towards such discovery, and suggest that the issue has already been resolved in this circuit. I write separately to emphasize that it has not been resolved.

 LIPEZ, Circuit Judge, concurring.

Jonathan M. Feigenbaum, attorney for the appellant, has really done a fine job in developing the complex issues in this case.  The opinion is posted on erisaboard.com in the New Cases forum.

(I explore post-Glenn issues such as these in a law review article I wrote for the South Dakota Law Review, a copy of which is posted in the Scholarship forum on erisaboard.com. which I will soon be updating in a podcast.)