Janine M. Gualderon vs. Long Term Disability Plan of Guild, Inc. CV 04-1049 PA
"'People. Not just policies.' best describes the way we feel about our relationship with you. Responding to your needs in a caring and assuring way is of prime importance to us." These were the words of Standard Insurance Company's President and CEO in his welcoming letter to Guild, Inc., when Standard agreed to accept the company's premium dollars. It was a sentiment that wasn't quite realized in Ms. Gualderon's case. Instead, after submission of her LTD claim, an investigation began that expanded again and again, growing increasingly intrusive and adversarial. Ultimately, it delved into every aspect of her business, finances and personal life, as well as into the lives of her ex-husband, her treating physician, her employees and former employees.
Ms. Gualderon was the owner of a company that manufactured women’s and children's clothing. She personally managed operations, production and shipping. She oversaw product design, directly interfaced with customers, and almost single-handedly handled all aspects of Guild's sales operations. When she took over the company in the 1980s its gross sales were about $2,000,000 a year. Before the end of the 90s gross sales exceeded $60,000,000 a year. By that time, the company occupied a 60,000 square foot warehouse, and had over 400 employees, working 3 shifts, operating 24 hours a day, 7 days a week.
Because of her sales and design responsibilities, frequent travel was mandatory. She spent approximately 20% to 25% of her time traveling, involving both domestic and international air travel. This caused her to develop a problem with her Eustachian tubes, which could not equalize air pressure when landing and taking off.
One day, while on a return flight from Europe, she felt a severe headache and started throwing up. She felt pain in her right ear and noticed it was bleeding. The next day, she saw a doctor, who told her she had burst an eardrum. She underwent surgery (tympanoplasty with mastoidectomy), in an effort to repair the damage to her ear. It didn’t help. Over the next two years, she had three additional ear surgeries, but none of these resolved her problems. Her doctors prescribed steroids and antibiotics. The side effects of the steroids created more problems, as she was unable to sleep, while taking them.
For almost two years after her problems started, she continued on with working and frequent flying. But every time she flew she had more problems, bursting her eardrum again and again. Infections would set in and the cycle repeated with extended travel. She suffered pain, migraines, drainage, dizziness, fever, fatigue, disorientation, nausea. She was also diagnosed with tinnitus. She struggled to continue working, but the harder she tried to work, the sicker she got. Eventually, it was impossible for her to put in the 60 to 80 hour weeks, generally required of her. She was forced to cut back on her activities, especially air travel. This left her unable to meet the travel demands of her position and as a result, her company sales plummeted. Finally, she left work, never to resume her occupation on a full-time basis after that. She had to give up the occupation that she loved and the company that she built.
Ms. Gualderon had purchased a higher grade of Long Term Disability (LTD) insurance, which cost more than the average LTD policy, but supposedly provided a higher grade of "income protection", that covered loss of earnings should she be unable to work in her "Own Occupation". Benefits were to be paid until age 65.
Ms. Gualderon was medically restricted from frequent flying on airplanes, as was well established by an independent vocational assessment, the examination reports of three treating physicians, as well as the reports of two of Standard's own reviewing physicians. Since frequent flying was a "material duty" of her "own occupation" and since she was medically restricted from performing that duty, she was clearly "disabled", as that term was defined in her policy.
She submitted a timely claim for LTD benefits. Thereafter, an enormous amount of correspondence went back and forth between Ms. Gualderon, her attorneys and Standard. Ultimately, a claims adjuster assigned to the claim directed a letter her attorney at that time, denying the claim on three stated grounds: (1) There was insufficient proof that Ms. Gualderon was a "Member" of the Plan; (2) available medical records did not support her disability; and (3) she had failed to attend an "Independent Medical Examination" (IME).
The first of these grounds was preposterous on its face and would later be retracted. The third ground (that she failed to attend an IME) was beyond erroneous -- it was fallacious. That left only the second ground, whether the medical records supported disability, which is the primary issue in any ERISA-LTD case. However, in Ms. Gualderon’s case the medical evidence was overwhelmingly supportive of her claim.
At that point, the case was referred to me. I submitted an administrative appeal letter and supporting documents. At first, Standard simply failed to respond to the appeal. I wrote follow-up letters and made phone calls, urging that the denial be reversed. Standard continued to ignore the appeal. Therefore, a lawsuit was filed and the case was prepared for trial. Result: The case was resolved satisfactorily.