Abatie

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

KARLA H. ABATIE, 

Plaintiff-Appellant, v. No. 03-55601

ALTA HEALTH & LIFE INSURANCE

COMPANY, a Delaware corporation,  D.C. No.

CV-01-06699-JFW

f/k/a Anthem Home Life Insurance

OPINION

Company, f/k/a Home Life Financial Assurance Company, Defendant-Appellee.  Appeal from the United States District Court for the Central District of California John F. Walter, District Judge, Presiding

Argued and Submitted February 11, 2005—Pasadena, California

Filed August 31, 2005

Before: Harry Pregerson, Robert R. Beezer, and Richard C. Tallman, Circuit Judges.

Opinion by Judge Beezer; Dissent by Judge Pregerson

11819 ABATIE v. ALTA HEALTH & LIFE INS. 11823

COUNSEL

Craig Price, Griffith & Thornburgh, LLP, Santa Barbara, Cal- ifornia, for the appellant.

R. Daniel Lindahl, Bullivant Houser Bailey, P.C., Portland, Oregon, for the appellee.

OPINION

BEEZER, Circuit Judge:

Appellee Alta Health & Life Insurance Company (“Alta”), administrator of an ERISA-regulated employee welfare bene- fit plan, denied appellant Karla H. Abatie’s claim for life…

dissenting.

I dissent. Unlike my colleagues, I do not think that Alta’s decision to deny life insurance benefits to Mrs. Karla Abatie, Dr. Joseph Abatie’s widow, should have been reviewed by the district court for an abuse of discretion. Rather, the district court should have conducted a de novo review of Alta’s decision.

Where a plan administrator flagrantly violates ERISA’s procedural protections causing the beneficiary to suffer substantive harm, a district court should conduct a de novo review of the plan administrator’s benefits decision. See Gatti v. Reliance Standard Life Ins. Co., 415 F.3d 978, 985 (9th Cir.2005) (“[PJrocedural violations of ERISA do not alter the standard of review unless those violations are so flagrant as to alter the substantive relationship between the employer and employee, thereby causing the beneficiary substantive harm.”). I think this is such a case for two reasons. When Alta rendered its final decision denying coverage to Mrs. Abatie in June 2002, it ignored deposition testimony in the administrative record that strongly favored Mrs. Abatie’s claim. Furthermore, Alta waited until its final decision denying coverage to give an additional reason…

Appellee Alta Health & Life Insurance Company (“Alta”), administrator of an ERISA-regulated employee welfare benefit plan, denied appellant Karla H. Abatie’s claim for life insurance benefits for the death of her husband, Dr. Joseph Abatie (“Dr.Abatie”). After conducting a bench trial, the district court held that Alta did not abuse its discretion. Abatie appeals. We have jurisdiction pursuant to 28 U.S.C. § 1291 , and we AFFIRM.

I

Dr. Abatie was employed by the Santa Barbara Medical Foundation Clinic (“Clinic”) until November 1992, when he took a medical leave of absence and applied for disability benefits. In early 1993, when Dr. Abatie was suffering from both lymphoma and anemia, the Clinic classified him as a retiree. Dr. Abatie’s health improved following a successful splenectomy in 1998, but he died in June 2000 from a combination of conditions. We turn to discuss the terms of the insurance policy and sketch the events leading to this dispute.

A

The life insurance policy at issue was' part of an employee welfare benefit plan provided by the Clinic. The Clime’s plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§…