District Court Remands Long-Term Disability Claim for Vocational Review After Finding Chevron Wrongly Denied Benefits

In Daniel C. v. Chevron Corp., No. 3:24-cv-03851-SK (N.D. Cal. Oct. 1, 2025), the U.S. District Court for the Northern District of California granted judgment in favor of the plaintiff, holding that Chevron’s claims administrator improperly denied his long-term disability (“LTD”) benefits under ERISA. Applying de novo review, the court independently examined the administrative record and concluded that while the medical evidence did not conclusively establish ongoing physical disability, the denial was flawed because ReedGroup failed to consider whether the plaintiff could perform a gainful occupation under the Plan’s demanding “Any Occupation” standard. The court remanded the case for further proceedings, directing the administrator to obtain vocational evidence before making any final determination.

Case Background

Daniel C. worked as an operator for Chevron, a physically demanding role requiring heavy exertion. In late 2017, he was struck by a motor vehicle, suffered a traumatic brain injury (TBI), and spent weeks in the hospital. His injuries included hemorrhages, skull fractures, pulmonary complications, and long-term cognitive issues.

He initially received short-term disability benefits for depression and anxiety stemming from workplace stress but later qualified for LTD benefits based on his neurological impairments. ReedGroup, Chevron’s third-party administrator, paid LTD benefits for more than two years before terminating them in June 2020.

Chevron’s LTD Plan distinguishes between mental and physical disabilities:

• First 24 months (“own occupation” period): A claimant is disabled if unable to perform their usual occupation.
• After 24 months (“any occupation” period): A claimant must show they cannot perform any gainful occupation—defined as work expected to provide at least 70% of predisability earnings. Benefits for mental health conditions are capped at 24 months unless the claimant is continuously hospitalized.

ReedGroup terminated Daniel’s claim on two grounds: (1) he had already exhausted the 24-month limit for mental health claims, and (2) his medical records did not establish a disabling physical impairment that prevented him from working in any occupation.

The Court’s Analysis

Magistrate Judge Sallie Kim reviewed the case de novo, weighing the entire administrative record without deferring to ReedGroup’s findings. The analysis focused on three core issues:

1. Declining to Expand the Record

The plaintiff urged the court to consider additional evidence that had not been before ReedGroup when it denied his claim, including an audiological evaluation performed months after the appeal was closed and scientific journal articles cited in briefing. The court declined.

Under Ninth Circuit precedent, judicial review of ERISA benefit denials is limited to the administrative record unless additional evidence is necessary to ensure adequate review. Because both parties had earlier agreed the case could be resolved on the existing record, and because the extra evidence was neither timely submitted nor necessary for de novo review, the court excluded it. This reinforced the principle that ERISA cases rise or fall based on what was presented to the claims administrator, not on post hoc supplementation.

2. Conflicting Medical Evidence

The medical record contained both supportive and contradictory findings:

• Neuropsychological testing showed Daniel’s overall cognitive profile was “generally intact,” though he consistently scored below average in memory and processing tasks, especially complex recall.
• Treating physicians differed:
  • Dr. Neff (neurologist) concluded Daniel’s residual TBI symptoms—including slowed speech, sensory overload, and memory loss—made him unable to work.
  • Dr. Banh (internist), however, declined to certify disability beyond June 2020, attributing his ongoing symptoms to psychological rather than neurological causes.
  • Dr. Tran (psychiatrist) sometimes described Daniel’s disability as non-psychological, but his records emphasized depression and anxiety.
• Imaging studies were inconclusive: A 2019 CT scan showed resolution of earlier damage, and a 2020 PET scan suggested possible early frontal lobe changes, though results were “probably not statistically significant.”

The court found the evidence ambiguous and insufficient to establish disabling physical impairment as of July 2020.

3. Application of the Mental Illness Limitation

ReedGroup relied heavily on the Plan’s 24-month cap for mental health conditions. But the court noted that Daniel originally qualified for LTD based on physical injuries, not psychological conditions, and the record reflected some continuing cognitive deficits. The administrator could not simply recast his disability as “mental only” without addressing the broader medical evidence.

4. Failure to Consider Vocational Evidence

The court found ReedGroup’s denial fatally flawed because it never assessed whether Daniel could perform a “gainful occupation” that would meet the Plan’s strict 70% wage-replacement threshold.

In distinguishing this case from McKenzie v. General Telephone Co. (9th Cir. 1994), Judge Kim explained that unlike McKenzie, Daniel did not have advanced education or experience in sedentary work—his background was limited to heavy labor. His traumatic brain injury was far more serious than the “slight impairment” in McKenzie. The Plan’s definition of “any occupation” was far more demanding, requiring not just any work, but work that pays comparably to his predisability earnings.

Because of these factors, vocational expertise was essential to determine employability. Without it, the denial could not stand.

Conclusion

The court granted Daniel’s motion for judgment and denied Chevron’s motion. However, instead of awarding benefits outright, the court remanded the case to the claims administrator to develop the record with vocational evidence.