The Eastern District of Missouri has dismissed a lawsuit filed by a heroin addict’s widow who was denied an insurer’s accidental death benefit because her husband’s demise was deemed an intentionally self-inflicted injury.
Plaintiff Terry M. Yates sued Symetra Life Insurance under the Employee Retirement Income Security Act (ERISA) of 1974, however her complaint was dismissed without prejudice because she did not appeal the insurer’s decision to deny the accidental death benefit.
“Because the Court finds that Plaintiff failed to exhaust her administrative remedies before filing suit, it will grant Symetra’s motion for summary judgment on that issue to the extent it will dismiss this case without prejudice,” U.S. District Judge Ronnie White wrote in his May 26 opinion.
Yates’ lawsuit could be re-filed.
“It may suggest that the plaintiff has another shot of going back through the appeals process before all is said and done on this,” said attorney David Eisenberg, member of the Baker Sterchi Cowden & Rice law firm and editor of the firm's Missouri Law Blog. “Decisions will have to be made about whether the case ought to be settled rather than everybody going through further legal wars.”
The Court also denied as moot Yates’ motion to strike portions of Symetra’s reply brief or in the alternative for leave to file a sur-response.
“This case is interesting procedurally because it drives home some of the issues involving exhaustion of administrative remedies, and that's a really fundamental legal principle,” Eisenberg told St. Louis Record. “If a staff member makes a decision or a hearing officer makes a ruling on a matter, there's almost always going to be a right of appeal.”
Underlying the litigation is how Yates’ spouse, Johnny Yates died. A toxicology report states that his blood tested positive for:
Codeine - Free 9.8 ng/mL
Morphine - Free 200 ng/mL
6-Monoacetylmorphine - Free 2.6 ng/mL
According to Judge White's opinion, the toxicology report says that codeine - free is a DEA schedule III narcotic analgesic with central nervous system depressant activity, morphine - free is a DEA schedule II narcotic analgesic, and 6-monoacetylmorphine - free is the 6-monoacetylated form of morphine, which is generally indicative of heroin (diacetylmorphine) use.
“Based on the evidence at hand I suspect that Yates went to his room and planned on injecting a substance, most likely heroin, right before going to bed. Yates accidentally overdosed while sitting on the edge of the bed and fell forward on the floor, face down. Yates then passed away due to an accidental overdose. Blood work was requested and this investigation will remain open until Yates’ blood is analyzed,” Judge White wrote in his ruling.
Terry Yates was an employee of Phelps County Bank when she participated in their employer-sponsored plan and her spouse was covered through her for dependent life insurance and accidental death and dismemberment policy.
“The legal question raised is whether it is a requirement for a plaintiff to exhaust the administrative remedies that insurers state not only in a denial letter but also have as part of the policy’s summary plan description,” Eisenberg said.
While the insurer, Symetra Life Insurance, stated in its denial letter to Yates that she was allowed a review of their determination by submitting a request in writing, Eisenberg said both parties could have benefitted from more detail.
“It doesn't say ‘You must appeal this or you will lose your right to have this further reviewed in court’,” Eisenberg said.
If Yates appeals her case, Eisenberg foresees that the Eight Circuit Court of Appeals could clarify whether the right of appeal is required to be spelled out in an insurer’s plan documents.
Judge White touched upon the issue briefly in his opinion.
“The Court concludes Plaintiff was required to exhaust the administrative appeal remedy she was given notice of in the Denial Letter, although there was no appeal provision or requirement in the Policy itself and the remedy was expressed in permissive language,” he stated. “Symetra’s motion for summary judgment will be granted to the extent the Amended Complaint will be dismissed without prejudice because Symetra’s motion is based on lack of exhaustion and no party asserts futility.”