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A former partner in the Denver office of Los Angeles’ Gibson, Dunn & Crutcher who gave up her practice in 1995 because she became sick when exposed to the firm’s office has won a $1 million bench verdict against a disability insurer that denied her claim. A 21-year practitioner and Gibson partner since 1982, Pamela A. Ray was eligible to earn up to $25,000 monthly under the firm’s long-term disability insurance if injury or illness made her unable to perform her duties. She handled large transactions in oil and gas, mining and real estate. Finding the insurer’s denial of benefits arbitrary and capricious, a federal judge presented the facts of Ray’s case in a lengthy opinion. Among other findings, he held that the insurer disregarded key evidence supporting Ray’s claim and pursued its speculation that Ray’s disability was psychiatric despite a lack of evidence. Ray v. Unum Life Insurance Co. of America, No. 97-WY-556-WD (D. Colo.). Two years before resigning, Ray began experiencing intense respiratory congestion, cough, headaches, chest pain and fatigue and told her doctors that five or six other people at the office, which was in a downtown Denver high-rise building, had similar symptoms, the judge wrote. An engineering firm tested the office air, but found nothing abnormal. Ray’s symptoms would worsen during the week and improve during the weekend, only to reappear on Monday. She tried different work arrangements: working on a different floor, in a different building and even at home for three months, but none was satisfactory. The Denver managing partner, George Curtis, told the insurer that Ray was truly sick and getting worse and that her working at home was unacceptable because she needed to meet with clients and work in person with associates and other staff. By 1994, her coughing and fatigue were so bad that concentrating at work became increasingly difficult. Unum Life Insurance Co. denied Ray’s disability claim but reversed itself after a reconsideration request. The insurer offered $190,000 as a full and final settlement of her claim, but Ray refused. In late 1995, the insurer paid past benefits of about $170,000 and thereafter made monthly $12,000 payments until the following July when it denied further benefits, triggering Ray’s suit. The insurer concluded that its surveillance showed that Ray was able to maintain fairly consistent activities with no apparent physical limitations. Her involvement in raising alpacas, which are similar to llamas, and tending to other activities, such as visiting her children’s school, indicated that Ray was not disabled from performing the duties of her occupation, the insurer found. The judge held that the insurer’s decision was unsupported by the evidence. Specifically, the insurer’s reliance on the plaintiff’s activity level as depicted in the surveillance video was arbitrary, the judge wrote. “Those activities bear no relation to Plaintiff’s ability to engage in her specialty in the practice of law,” he wrote. There was “substantial evidence” the plaintiff has an illness caused by prolonged exposure to large office buildings, the judge wrote. Though the insurer’s doctors questioned the severity of Ray’s symptoms, they never met with her. “The Court finds that the ability to function in a large office building environment is itself a material duty of Plaintiff’s regular occupation,” the judge wrote, since even if the plaintiff could find another job in a different building, law firms with transactional business typically are in large office buildings. The judge ordered the insurer to pay $930,000 in benefits owed since 1996 and $70,000 in attorneys’ fees. ALPACAS AND LAW Plaintiff’s attorney James A. Cederberg, a Boulder, Colo., solo practitioner, said the insurer had come up with a series of justifications for denying the claim. “None of them held any water,” Cederberg said. “And when one sprung a leak, they came up with another.” The insurer argued that if Ray could put her alpacas on exhibit then she could return to work in a high-rise. “There’s a big difference between that and trying to practice law,” Cederberg countered. The insurer’s attorney, Sandra L. Spencer of White & Steele in Denver, was unavailable for comment. Using a psychiatric justification as a basis for denying disability benefits is typical in “sick building syndrome” claims, said Steven D. Archer, a plaintiffs’ lawyer who won a $4.2 million negligence verdict in 1996 on behalf of 14 Los Angeles District Attorney’s Office employees who became ill after a building renovation. People with medical problems stemming from sick buildings are often treated as if they claimed they “just stepped off a spaceship,” said Archer, partner in the Los Angeles office of Minneapolis’ Robins, Kaplan, Miller & Ciresi.

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