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Wednesday, May 2, 2012

The Fourth Circuit Court of Appeals recently joined five other judicial circuits in ruling that a district court’s remand of a benefits claim to the plan administrator is not immediately appealable. A copy of the Fourth Circuit’s decision in Dickens v. Aetna Life Ins. Co. (4th Cir. Apr. 20, 2012) can be viewed by clicking here. The ruling comes on the heels on a similar ruling by the Eleventh Circuit in Young v. Prudential Ins. Co. of Am., 671 F.3d 1213 (11th Cir. Feb. 21, 2012), which we summarized earlier.

In Dickens, the plaintiff applied for long-term disability benefits after being diagnosed with clinical depression, anxiety, insomnia, among other conditions. A predecessor plan administrator granted the LTD benefits in 2004. Four years later, the successor plan administrator, Aetna, terminated the benefits on the grounds that the plaintiff no longer suffered from a debilitating illness. (The Social Security Administration (“SSA”), which had previously determined the plaintiff to be disabled, continued to pay disability benefits.) After exhausting his administrative appeals, the plaintiff sued to have his LTD benefits restored. The district court ruled that Aetna’s decision to terminate the LTD benefits was “arbitrary and unreasonable” because it failed to consider relevant evidence relating to the SSA’s award of disability benefits. The district court expressed no opinion as to whether the plaintiff was disabled under the definition in the LTD plan, and it never issued a final judgment. Aetna filed a direct appeal to the Fourth Circuit.

In a ruling short on analysis, the Fourth Circuit ruled that it did not have appellate jurisdiction under 28 U.S.C. § 1291 because the district court’s remand order was not a “final decision.” In so ruling, the Court adopted the rationale of its sister courts from the First, Sixth, Eighth, Tenth and Eleventh Circuits, and it specifically rejected the reasoning of converse rulings by the Seventh and Ninth Circuits.

The Fourth Circuit also rejected the argument that appellate jurisdiction was present under the “collateral order” doctrine. That doctrine permits immediate appellate review of decisions “collateral to” rights asserted in the action too important to be denied review until the whole case is adjudicated below. Aetna had argued that the collateral order doctrine applied because if it gave substantial weight to the SSA’s disability determination, then it would be compelled to award LTD benefits and thereby forfeit judicial review. The Fourth Circuit dismissed that argument and noted that the district court’s order did not compel Aetna to grant an award of LTD benefits upon remand. Even if Aetna’s reconsideration results in an award of benefits, the Fourth Circuit added, it would not be foreclosed from seeking an appeal from a final judgment.

With the Fourth and Eleventh Circuits having ruled that remand orders are not immediately appealable, it is now safe to characterize that as the clear “majority view” among the judicial circuits. Three circuit courts – the Second, Third and Fifth – have yet to weigh in on the issue.

 

 

 

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