No Deference, No Clawback: ERISA Court Rejects Unum’s Discretionary Review and Its Bid to Recover Alleged Overpayments

In Krambeck v. Unum Life Insurance Company of America, No. 8:24-cv-2102-TPB-NHA, 2026 WL 2935928 (M.D. Fla. Sept. 30, 2026), Judge Tom Barber of the United States District Court for the Middle District of Florida denied both parties’ cross-motions for summary judgment on a long-term disability claim governed by ERISA, ruling that the claim must proceed to a de novo bench trial. Along the way, the court held that de novo review applies despite a discretionary clause in the policy, and it granted Plaintiff summary judgment defeating Unum’s counterclaim to recover alleged overpayments.

Plaintiff worked as a sales assistant at a Costco store and stopped working in 2020 after contracting COVID-19, reporting continuing symptoms that included shortness of breath and dysphonia, meaning hoarseness and difficulty speaking. Unum paid benefits under the plan’s “own occupation” standard for the initial nine-month period. After that period, the plan paid continued benefits only if Plaintiff could not perform the duties of “any gainful occupation.” The parties did not dispute that an inability to speak for more than 30 minutes a day would leave Plaintiff unable to perform any gainful occupation. Plaintiff’s treating physician reported that Plaintiff could speak only about 30 minutes a day, and later only a few minutes a day. Unum’s in-house physician and two outside consulting physicians concluded instead that Plaintiff could perform full-time sedentary work requiring occasional speaking, which the record defined as up to 2.5 hours in an eight-hour day. Unum terminated benefits, and Plaintiff sued.

Why did the court apply de novo review when the policy gave Unum discretion?

The policy expressly granted Unum discretion over benefit determinations, which would ordinarily trigger deferential review. Plaintiff argued that Washington law governs the policy and that a Washington regulation, Wash. Admin. Code § 284-96-012, prohibits disability policies from granting discretion to the fiduciary. Unum responded that the original policy took effect in 2001, years before the 2009 regulatory ban, and that the ban does not apply retroactively. The court sided with Plaintiff on the ground that a January 1, 2020 amendment replaced the entire policy and set a new effective date of January 1, 2020, applicable to disabilities beginning on or after that date. Because Plaintiff’s disability arose after the amendment took effect, the operative policy postdated the Washington ban by more than a decade, so applying the regulation was not retroactive. Notably, Unum’s briefing did not address Plaintiff’s argument that the 2020 amendment reset the effective date. The court concluded that Unum lacked discretion and that de novo review governs.

Can an ERISA court weigh conflicting medical opinions against each other on summary judgment?

The court next addressed how to handle de novo review at the summary judgment stage. District courts in the Eleventh Circuit often treat ERISA benefits cases as something closer to an appellate review on the administrative record, deciding on the papers whether the administrator was “wrong.” The court questioned whether that approach fits a de novo case that turns on a factual dispute about disability. Relying on binding Eleventh Circuit precedent in Kirwan v. Marriott Corp. and Shaw v. Connecticut General Life Insurance Co., the court held that the traditional summary judgment standard applies to de novo review, and that conflicting physician opinions create genuine issues of material fact that require a trial. The court pointed to the competing conclusions of the treating physician, Unum’s in-house physician, and Unum’s two consultants, as well as credibility questions surrounding a phone conversation between Unum’s physician and the treating physician and a follow-up letter the treating physician never answered. Because neither side had consented to a “bench trial on the papers,” the court declined to weigh the evidence itself and instead set the matter for a de novo bench trial on a complete record.

What happened to Unum’s counterclaim to recover alleged overpayments?

Unum counterclaimed to recover part of the long-term disability benefits it had paid, pointing to Plaintiff’s later receipt of more than $24,000 in retroactive Social Security disability benefits for the same period. The court granted Plaintiff summary judgment on that counterclaim as to amounts already received. Under Montanile v. Board of Trustees of National Elevator Industry Health Benefit Plan, an ERISA plan may seek only equitable relief under Section 502(a)(3), which requires the plan to reach a specific identifiable fund in the claimant’s possession rather than her general assets. Plaintiff’s declaration stated that the Social Security and Unum funds had been spent and were no longer traceable to any identifiable asset. Unum offered no contrary evidence and no argument that Plaintiff’s showing fell short, so it failed to establish the specific fund that equitable relief requires. The court deferred any ruling on future benefits, since Unum’s right to an offset will matter only if the court ultimately finds that Unum owes continued benefits.

The court denied both cross-motions on the benefits claim, granted Plaintiff summary judgment on Unum’s counterclaim as to payments already received, and set the case for a de novo bench trial, leaving the parties the option to jointly propose an alternative procedure for resolving the claim on the record.