Eleventh Circuit: Under De Novo Review of an ERISA Benefit Decision, District Court Cannot Limit Review to the “Administrative Record”

In Harris v. The Lincoln National Life Insurance Company, Lincoln Life Assurance Company of Boston, No. 21-13186, __F.4th__, 2022 WL 3009199 (11th Cir. July 29, 2022), the Eleventh Circuit issued an important evidentiary decision applicable to ERISA benefit claims. In this dispute over the payment of long-term disability benefits, Plaintiff Virgil Harris sought for the district court to consider evidence that had not been presented to Defendant Lincoln before it finally denied Harris’ LTD claim, including an affidavit and updated medical records that post-dated the denial. Though everyone agreed that de novo review applied to the court’s review of Lincoln’s decision, the district court excluded Harris’ post-denial evidence based on the Eleventh Circuit’s decisions in Glazer v. Reliance Standard Life Ins. Co., 524 F.3d 1241, 1246 (11th Cir. 2008) and Blankenship v. Metro. Life Ins. Co., 644 F.3d 1350, 1354 (11th Cir. 2011). The Eleventh Circuit found this evidentiary ruling constituted error under Eleventh Circuit precedent.

The Eleventh Circuit discussed the circuit court differences with respect to allowing new evidence on de novo review. On one end of the spectrum, the Fifth and Sixth Circuits instruct district courts to remain within the bounds of the administrative record. In the middle of the spectrum, including the Fourth, Seventh, Eighth, Ninth, and Tenth Circuits, district courts can consider new evidence in certain circumstances. On the other end of the spectrum, the Third and D.C. Circuits hold that de novo review requires district courts to consider all relevant evidence regardless of whether the ERISA claims administrator considered the evidence when it made the claims decision. The Eleventh Circuit aligned itself with this end of the spectrum.

The Eleventh Circuit explained that it has described ERISA’s civil action to recover benefits as akin to common law breach of contract causes of action. In two ERISA decisions—Moon v. Am. Home Assurance Co., 888 F.2d 86, 89 (11th Cir. 1989) and Kirwan v. Marriott Corp., 10 F.3d 784, 789 (11th Cir. 1994)—the court held that on plenary review parties can present evidence which was not before the administrator when it denied benefits. Since Moon and Kirwan have not been abrogated by the Supreme Court, nor overruled by an en banc opinion of this court, they remain binding precedent.

The court addressed and rejected several of Lincoln’s arguments supporting the district court’s exclusion of post-denial evidence. First, the court explained that its decisions in Williams v. BellSouth Telecomms., Inc., 373 F.3d 1132, 1137–38 (11th Cir. 2004) and Blankenship did not abrogate Moon and Kirwan because they only set out a sequential process for resolving ERISA cases but no not speak to what evidence a district court can consider when review is de novo. Even if Williams and Blankenship could be read to exclude new evidence, Moon and Kirwan would still control because where there is an intra-circuit conflict on a legal issue and the cases cannot be reconciled, the earliest case governs. Second, the court also explained that it has never required a showing of good cause to present new evidence in ERISA benefit cases governed by de novo review. Even if precedent required some showing of good cause, the district court here did not make any pronouncements or findings about good cause. Lastly, the court determined that it would not sua sponte conduct a harmless error analysis to affirm whether the administrative record supports the denial of benefits. The court reversed the district court’s judgment in favor of Lincoln and remanded for further proceedings.