For a recent case analyzing post-Glenn discovery in ERISA benefit cases, check out the opinion of the U.S. District Court for the Northern District of Illinois in Garvey v. Piper Rudnick LLP Long Term Disability Insurance Company, 2009 WL 3260010, (N.D. Ill. Oct. 9, 2009). In that case, the court considered whether an attorney claimant was entitled to conflict discovery in his disability case.
The Garvey court conducted a fairly thorough overview of post-Glenn discovery cases in the Seventh Circuit and elsewhere. While noting the varying approaches – everything from no discovery to expanded discovery – the court ultimately allowed the claimant to conduct limited discovery under the pre-Glenn Seventh Circuit principles of Semien v. Life Ins. Co. of N. Amer., 436 F.3d 805 (7th Cir. 2006).
The Garvey court rejected the notion that claims personnel act under a personal conflict of interest merely because of the employing insurer’s “mandate to try and contain claims liability.” As noted by the court, “[c]laims containment is presumably a general goal of all insurance companies and their staff.”
Yet, given the insurer’s dual role of insurer and claim administrator, and the fact that it “granted [self-funded short term disability] benefits to Garvey until its own [long term disability] funds were at risk,” the court found sufficient evidence “to believe that limited discovery will reveal a procedural defect.”
In the end, the court granted discovery on the compensation of consulting physicians, employees and third-parties responsible for reviewing the claim, as well as discovery on claim approval and denial rates under the plan.
