A federal judge in Newark, N.J., has restored disability benefits to a lawyer that Prudential Insurance cut off by assuming the work of all attorneys is "sedentary."
District Judge Stanley Chesler concluded that the decision to stop long-term disability benefits for John Simon, formerly of Wolff & Samson of West Orange, N.J., was arbitrary and capricious and he is entitled to reinstatement of the benefits: $20,000 a month after taxes.
The judge also faulted the carrier for relying on the fact that Simon's income rose substantially during the time he claims his ability to work was decreasing, because most of the money was shared fees from clients he brought in.
And Pru breached its fiduciary duty to Simon by not following up on its own medical expert's recommendation for further evaluation, Chesler held in Simon v. Prudential Life Ins. Co. of America, 10-cv-4286.
Under the policy, applicants for long-term disability benefits must show they are "unable to perform, for wage or profit, the material and substantial duties of your occupation."
The coverage was paid for by Wolff & Samson, where Simon went to work in 1992 after leaving Hannoch Weisman.
In 1998, Simon was seriously injured in a head-on collision that totaled his Jeep Grand Cherokee and pushed the engine into his lower body, fracturing bones in his right leg and left foot and injuring his upper body, according to court papers. The air-bag impact put him in a 10-day coma and he remained bedridden for months. He nearly lost his leg, which was reconstructed in a series of surgeries over the years with metal screws and plates, cow bone and part of his stomach muscle, according to the papers.
Simon was diagnosed with regional pain syndrome and post-traumatic stress disorder. He returned to work in 1999 on heavy medication but was unable to perform as before, he claims.
Before the accident, he was billing 2,000 hours a year, spending most of his time outside the office, litigating cases, developing a client base, lecturing on environmental law and serving on a government commission, he says. He was often out of state, traveling by air and carrying heavy files.
That allegedly changed after the crash, as pain in his legs made it hard for him to sit, stand or drive and he had to use a cane to keep from falling because of drop foot. He needed help tying his tie because of hand tremors and at times could not hold a coffee mug or pen.
Making things worse was his cognitive decline from pain pills -- as many as 15 a day -- that impaired his ability to focus or to remember what he was doing. The firm started sending another lawyer with him to meetings with clients or opposing counsel, he says.
Things got to the point where he "ceased all litigation-related activities" in or out of the office, and his billable time shrank to almost nothing, he says. He "went from an ever-traveling and on-the-go litigator to a mere figurehead."
Wolff & Samson tried to accommodate him by letting him work from a home he bought in Arizona where he says he felt less pain due to the climate and could reduce the painkillers. In 2002, he started going there every six weeks, and the visits increased in frequency over time. He eventually moved to Scottsdale after he stopped practicing in August 2008.
During his last month at work, he had only 4.2 billable hours, down from 6.2 the month before.
As his billables fell, his compensation increased: from $470,000 in 2006 -- $140,000 salary, $330,00 bonus -- to $731,000 in 2008 -- $129,428 salary, $598,758 bonus.
Prudential starting paying benefits in November 2008, pending further review, but terminated them in December 2009. In denying his appeal in August 2010, it cited a lack of proof that his impairment made him unable to perform his "occupation," generically defined as "lawyer" and classified as "sedentary."
Calling Simon "no ordinary lawyer," Chesler noted that the money the firm paid him his last three years was for "generating business for the firm by bringing in clients," and said Prudential did not sufficiently consider whether Simon "could actually perform all of the specific job requirements of his actual occupation."
Chesler, however, denied a request for legal fees, saying that even if Prudential acted in bad faith, its conduct was "not sufficiently egregious."
Simon's lawyer, Eugene Killian Jr., says he cited cases around the country where Pru has similarly denied benefits on an "own-occupation policy" by treating "what a computer spit out about what an occupation involved as definitive, without looking into the specific facts of what the person was doing."
Simon was "an environmental trial lawyer with a national practice, going around the country, always on his feet," says Killian, who heads a firm in Iselin. He adds that Simon is running out of money, and "I'm hoping everyone in the case can sit down and get this thing worked out."
Prudential's attorney, Jaclyn DiLascio Malyk of Cuyler Burk in Parsippany, N.J., declines to comment.
Wolff & Samson managing partner David Schlossberg did not return a call.