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Unum Life Insurance Company of America v. Wilson

United States District Court, D. Maryland

November 6, 2014



BETH P. GESNER, Magistrate Judge.

The above-referenced case was referred to the undersigned for review of plaintiff's motion for default judgment and to make recommendations concerning damages, pursuant to 28 U.S.C. § 636 and Local Rules 301 and 302. (ECF No. 8.) Currently pending is plaintiff's Motion for Entry of Default Judgment ("Motion"). (ECF No. 7.) I have reviewed plaintiff's Motion, the Affidavit of Elizabeth Simpson in Support of Motion for Entry of Default Judgment (ECF No. 7-1), and the Affidavit of Colleen K. O'Brien in Support of Motion for Entry of Default Judgment (ECF No. 7-15). Defendant has not filed any response to plaintiff's filings. No hearing is deemed necessary. See Fed.R.Civ.P. 55(b)(2); Loc. R. 105.6. For the reasons discussed herein, I respectfully recommend that plaintiff's Motion (ECF No. 7) be GRANTED and that relief be awarded as set forth herein.


In reviewing a motion for default judgment, the court accepts as true the well-pleaded factual allegations in the complaint as to liability. Ryan v. Homecomings Fin. Network , 253 F.3d 778, 780-81 (4th Cir. 2001). It remains for the court, however, to determine whether these unchallenged factual allegations constitute a legitimate cause of action. Id . If the court determines that liability is established, the court must then determine the appropriate amount of damages. Id . The court does not accept factual allegations regarding damages as true, but rather must make an independent determination regarding such allegations. See, e.g., Credit Lyonnais Secs. (USA), Inc. v. Alcantara , 183 F.3d 151, 154-155 (2d Cir. 1999). The court may make a determination of damages without a hearing, so long as there is adequate evidence in the record, such as detailed affidavits or documentary evidence, for the award. See, e.g., Adkins v. Teseo , 180 F.Supp.2d 15, 17 (D.D.C. 2001).


A. Defendant's Liability

I have reviewed plaintiff's Complaint (ECF No. 1), and find that plaintiff has stated causes of action based on a breach of a Disability Payment Options/Reimbursement Agreement ("Reimbursement Agreement") signed by defendant as a participant in a group long-term disability plan ("the Plan") offered by her employer. Plaintiff Unum Life Insurance Company of America ("Unum") is an insurance company incorporated under the laws of the State of Maine, and authorized to transact business in the State of Maryland. (ECF No. 1 at ¶ 1.) Plaintiff issued the Plan to defendant's employer, Northrup Grumman Corporation. (ECF No. 1 at ¶ 6.) The Plan qualifies as an employee welfare benefit plan under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq. (ECF No. 1 at ¶ 6.) Defendant submitted a claim to plaintiff under the Plan, and began receiving long-term disability ("LTD") benefits on February 26, 2007. (ECF No. 1 at ¶¶ 7-8.)

The Plan provided that defendant's monthly LTD benefits would be reduced by defendant's "deductible sources of income, " such as the amount of benefits defendant received or was entitled to receive under the United States Social Security Act ("SSA"), as well as the disability and retirement payments defendant received under her employer's retirement plan. (ECF No. 1 at ¶ 9.) The Plan also provided that plaintiff would estimate defendant's entitlement to Social Security disability income ("SSDI"), and reduce her monthly LTD benefits by that estimated amount if such benefits "[had] not been awarded" and "[had] not been denied." (ECF No. 1 at ¶ 12.) On April 10, 2007, defendant signed a Reimbursement Agreement, pursuant to which she agreed to repay plaintiff for any overpayment of LTD benefits resulting from her receipt of deductible sources of income. (ECF No. 1 at ¶ 10.) Plaintiff subsequently paid defendant unreduced LTD benefits under the Plan. (ECF No. 1 at ¶ 11.)

From September of 2007 through April of 2009, plaintiff sent defendant multiple requests for information regarding the status of her application for SSDI benefits. (ECF No. 1 at ¶ 12.) Defendant provided no proof that she had either applied for or been denied such benefits. (ECF No. 1 at ¶ 13.) Therefore, on May 20, 2009, plaintiff informed defendant that it would estimate her monthly SSDI benefits and reduce her monthly LTD benefits accordingly. (ECF No. 1 at ¶ 13.) In addition, on May 18, 2011, plaintiff became aware that defendant received pension benefits from her employer, which constituted a deductible source of income under the Plan. (ECF No. 1 at ¶ 14.)

Defendant's failure to apply for SSDI benefits and receipt of pension benefits resulted in an overpayment by plaintiff of $49, 463.25. (ECF No. 1 at ¶ 15.) On May 20, 2011, plaintiff requested that defendant repay that amount. (ECF No. 1 at ¶ 15.) When defendant failed to do so, plaintiff began to withhold her monthly LTD benefits and applied that amount to satisfy the overpayment. (ECF No. 1 at ¶ 16.)

On December 4, 2012, defendant's LTD benefits terminated for failure to provide proof of claim. (ECF No. 1 at ¶ 17.) An overpayment of $36, 679.18 has remained due and owing to plaintiff since that date. (ECF No. 1 at ¶ 17.) Despite plaintiff's additional requests for payment, defendant has failed to repay that amount. (ECF No. 1 at ¶ 17.) Thus, plaintiff filed this suit seeking recovery of the outstanding overpayment and other damages.

Plaintiff served defendant with a Summons and copy of the Complaint on May 23, 2014. (ECF No. 4.) After defendant failed to answer the Complaint or otherwise defend within twentyone days, plaintiffs properly moved, pursuant to Federal Rule of Civil Procedure 55(a), for an entry of default. (ECF No. 5.) The Clerk of this court entered an Order of Default on July 9, 2014. (ECF No. 6.) On July 31, 2014, plaintiff filed the pending Motion (ECF No. 7), to which defendant has not responded. Plaintiff seeks damages in the following amount: (1) $36, 679.18 for the breach of the Plan and the Reimbursement Agreement; (2) $5, 419.50 in attorneys' fees; (3) $701.86 in costs; and (4) post-judgment interest at the legal rate. (ECF No. 7 at ¶¶ 24-26; ECF No. 7-15.) In support thereof, plaintiff submitted the affidavit of Elizabeth Simpson, Manager in the Financial Recovery Unit at Unum, and the affidavit of Colleen K. O'Brien, cocounsel for plaintiff (ECF Nos. 7-1 and 7-15.) Based upon my review of the record in this case, I conclude that plaintiff has demonstrated defendant is liable to plaintiff for damages and that plaintiff is entitled to a default judgment against defendant.

B. Damages

Having determined that plaintiff has proven liability, the undersigned now undertakes an independent determination of the damages to which it is entitled. Pursuant to ERISA and the provisions of the Plan and the Reimbursement Agreement, plaintiff seeks to ...

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