In an unpublished opinion dated June 20, 2019, a panel of the U.S. Court of Appeals for the Fourth Circuit unanimously agreed with a North Carolina district judge that Reliance Standard Life Insurance Company abused its discretion in terminating a man’s long-term disability benefits. Judge J. Harvie Wilkinson, III authored the opinion. The case is Smith v. Reliance Standard Life Insurance Company, No. 18-2225, __F.App’x__, 2019 WL 2539289 (4th Cir. June 20, 2019).

The plaintiff suffers from hypertension, narrow blood vessels, coronary artery disease, and diabetes. He received a triple bypass operation, and after the surgery, he dealt with extensive numbness to the left side. He worked part-time briefly after the surgery, but his doctors eventually insisted that he stop working because any level of stress could worsten his condition. The plaintiff applied for disability with Reliance in 2013. On the disability application form, the defendant’s doctor noted that the health problems were work related and came from stress, detailing that the defendant could “NEVER” return to work.

The insurance company first decided to terminate benefits in August 2015. They believed Smith to not be totally disabled because he could perform “sedentary work,” and a note from one of his doctors said that the plaintiff “walks up to 40 miles without difficulty.” In the plaintiff’s appeal letter, he explained that the 40 miles was cumulative from over four months between Christmas and April. In November of that year, Reliance resumed paying benefits.

In April 2016, the insurance company reversed course again, this time based mostly on the compiled notes of a heart specialist. These notes were formatted using voice recognition software and contained obvious errors that the insurance company seized on to justify terminating benefits.  Plaintiff’s  treatment notes from his treating physician also contained statements to the effect that he was doing well. However, the court was easily able to deduce from the context that the doctor meant he was doing well for someone with his conditions, and the treating doctors never said he could go back to work.

The insurance company also sent the plaintiff’s medical records to its paid consulting doctor for review. This doctor did not examine the plaintiff and failed to contact each of his doctors. Based on the report of this consulted heart specialist,  Reliance determined that the plaintiff was no longer disabled as of June 2016. The district court and the court of appeal ruled in favor of the plaintiff citing the neglect of the insurance company and its doctor to take all the evidence into account and read the plaintiff’s medical records in context.