Federal District Court Opinions

KRAYNAK v. FINANCIAL ACCOUNTING FOUNDATION, (Conn.
11-29-2006) JOANNE E. KRAYNAK, Plaintiff, v. FINANCIAL
ACCOUNTING FOUNDATION LONG TERM DISABILITY PLAN, et al.,
Defendants. CIVIL ACTION NO. 3:04cv1662 (SRU). United
States District Court, D. Connecticut. November 29, 2006

MEMORANDUM OF DECISION

STEFAN UNDERHILL, District Judge

This dispute arises from the denial of Joanne Kraynak’s
claim for long-term disability benefits by Reliance
Standard Life Insurance Company (“Reliance”). Reliance
argues that Kraynak failed to file this action within three
years of that denial, as required by her benefit plan.
Kraynak argues that the three-year limitation period does
not apply because she never received the summary plan
description (“SPD”) that set forth the limitation, and thus
had no notice of the provision. On October 31, 2006, I held
an evidentiary hearing to determine whether Kraynak
actually received the SPD. For reasons that follow, I find
that Reliance has shown, by a preponderance of the
evidence, that Kraynak received the SPD. Her claims against
defendants are therefore dismissed as untimely.

I. Background

Kraynak worked as an administrative assistant for the
Financial Accounting Foundation (“FAF”) from April 1995
until October 1998. In October 1998, Kraynak became unable
to work due to headaches and uncontrollable shaking of the
left side of her face and left arm. In March 1999, Kraynak
applied to Reliance for disability benefits. Reliance
initially agreed to pay her benefits. On August 13, 1999,
however, Reliance reexamined its benefit determination and
Page 2 terminated her benefits. Kraynak appealed Reliance’s
decision to terminate her benefits, but Reliance denied
Kraynak’s appeal. On October 4, 2004, more than three years
after Reliance denied her claim for benefits, Kraynak filed
the instant suit in which she challenges Reliance’s final
determination.

The principal issue raised by the present motion is the
timeliness of Kraynak’s claim. ERISA does not contain a
statute of limitations for a suit to recover benefits, so
the contract statute of limitations applies as the “most
analogous” state statute. Cole v. Aetna Life & Cas., 2002
U.S. Dist. LEXIS 19656, *16 (D. Conn. 2002). The statute of
limitations for contract claims in Connecticut is six
years.

Reliance’s long-term disability plan provides that an
individual may challenge a plan provider’s decision to deny
benefits in federal court, but limits the time period in
which a party may bring suit. The plan states:

LEGAL ACTIONS: No legal action may be brought against us
to recover on the Policy within sixty (60) days after
written proof of loss has been given as required by the
Policy. No action may be brought after three (3) years
(Kansas, five (5) years; South Carolina, six (6) years)
from the time written proof of loss is received.

Defendant’s Ex. 3, p. 4.1.[fn1]

Defendants filed a motion for summary judgment in which
they argued that Kraynak’s claim was time-barred because
Kraynak did not file her complaint within the three-year
period. Kraynak argued that the three-year limitation
period does not apply because she never received Page 3
the SPD and thus had no notice of the provision. On
September 22, 2006, I denied defendants’ summary judgment
motion because a disputed issue of material fact existed
with regard to whether Kraynak actually received the SPD.
After I ruled on the motion, the parties agreed that it
would be more efficient to litigate the statute of
limitations issue to completion before addressing the
merits of Kraynak’s disability claim. Therefore, on October
31, 2006, I held a hearing to resolve the factual dispute
whether Kraynak had notice of the three-year limitation
period. Both sides presented evidence. The defendants now
bear the burden of proof, and must prove by a preponderance
of the evidence that Kraynak received a copy of the SPD.

II. Discussion

At the hearing, the defendants presented credible evidence
to prove that they provided Kraynak a copy of the SPD. The
defendants elicited testimony from two long-time FAF human
resources employees. Elana Colafrancesco, FAF’s human
resources manager, testified that Shirley O’Neill, FAF’s
personnel manager, prepared packets to send to all new
hires that included disability benefit booklets. The
booklets contained the SPD. Colafrancesco also testified
that she met with Kraynak, as she did with all new hires,
on Kraynak’s first day of employment to discuss benefits.
Colafrancesco did not recall Kraynak indicating that she
did not receive the packet or the long-term disability
booklet. In fact, Colafrancesco did not recall any employee
ever telling her they did not receive the long-term
disability booklet, nor did she recall the company ever
running out of booklets to give to new hires.

O’Neill testified that she sent all new hires a
confirmation packet in which she enclosed a letter and
certain necessary forms, including the long-term disability
booklets that included the SPD. O’Neill also testified that
she sent, or personally delivered, the confirmation packet
to Page 4 Kraynak, and that in all her years at FAF, the
company has never run out of disability plan booklets.

Further, O’Neill kept a checklist for every new employee
to ensure that all new hires received the necessary
documents. The checklist included a section that listed the
documents O’Neill sent to each employee at the time they
began work at FAF. Defendants’ Ex. 4. That list states:

Mail employment letter with explanatory cover sheet and
the below listed forms and booklets to be filled out and
returned:

? Report re: Investments, Personal Activities, etc. (To
be returned before first working day.)

— I-9 Immigration Form

— Group Insurance Booklets

— Medical, Dental and Life booklets and application
forms

— Long term Disability

— Pension Materials

— Calculate 1st year Vacation accrual ___ and 1st year
Floating Holidays ___ (include in ltr).

Id.

At the hearing, the defendants produced the checklist
O’Neill used to track Kraynak’s documents. The checklist is
fairly comprehensive and contains multiple handwritten
notations indicating whether O’Neill had completed various
procedures and the dates upon which O’Neill did so. Id. The
box adjacent to the mailing list on Kraynak’s checklist was
checked and dated “4-3-95,” indicating that the materials
were sent or handed to Kraynak on that date. Id.
Additionally, the checklist contained notations when tasks
were not completed or not applicable. The “Long Term
Disability” item on the checklist, however, contains no
notations. Id. O’Neill testified that if she did not give
the disability booklet to Kraynak or if the booklet was
unavailable, she definitely would have made a notation on
the checklist. Finally, Kraynak Page 5 certainly received
other items on the mailing checklist. Specifically, she
received her I-9 form, completed the form, and executed the
form on April 3, 1995. Defendants’ Ex. 1. As with the “Long
Term Disability” booklet item, O’Neill made no notations
adjacent to the “I-9 Immigration Form” item on the
checklist. Id.

Kraynak argues that several pieces of evidence show that
she never received the long term disability booklet that
contained the SPD. First, Kraynak argues that there is a
discrepancy with regard to whether O’Neill sent the packet
to Kraynak through the mail or actually hand-delivered the
packet to Kraynak. The discrepancy exists because most of
FAF’s new employees are hired externally, and thus their
packets are mailed. Kraynak, however, had been a temporary
employee at FAF for ten weeks prior to her hiring.
Defendants’ Ex. 4. O’Neill testified that, because Kraynak
was physically present at FAF at the time she was hired,
O’Neill might have actually handed the packet to Kraynak,
as opposed to sending it through the mail. In fact,
O’Neill apparently did hand-deliver the packet, because
Kraynak signed and dated her I-9 form on April 3, 1995, the
same date that O’Neill marked the packet as sent on the
checklist. Id., Defendants’ Ex. 1. Regardless of whether
she received the booklet through the mail or through
personal delivery, I find that Kraynak received the booklet
and thus had notice of the three-year limitation for filing
a lawsuit challenging denial of benefits.

Second, Kraynak had asserted that she wrote a note on the
cover of the “Group Benefits Plan” booklet when she
returned from her initial human resources meeting with
Elena Colafrancesco on April 5, 1995 indicating that “Elena
ran out of CTD Booklets — will send when they come
in. Best buy in insurance.” Plaintiff’s Ex. 1. The last
page of the Group Benefits Plan booklet, however, shows
that the booklet was printed on “3-96.” Kraynak Decl. Ex. 1
p. 2. Page 6 Kraynak acknowledged at the hearing that she
could not have written that note after her meeting with
Colafrancesco in 1995, because that document was not
created until months later.

Third, Kraynak testified that she kept all of her
employment information in a file drawer at her house, and
the long-term disability booklet was not in her file. That
fact, even if true, does not necessarily mean that the
defendants never supplied Kraynak with the booklet. There
could be many other reasons why the long-term disability
booklet was not in Kraynak’s file drawer.

The defendants have proven by a preponderance of the
evidence that they did supply Kraynak with a long-term
disability booklet that included a copy of Reliance’s SPD.
Kraynak thus had notice of the three-year time limitation.
Because she filed her claim outside of the three-year
period, her claims against the defendants are time-barred.

III. Conclusion

For the foregoing reason, judgment shall enter in favor of
the defendants and against Kraynak. The clerk shall close
the file.

It is so ordered.

[fn1] Such contractual limitations periods can be valid.
Parties to a plan may agree to a shorter limitations period
provided that the limitations period itself is a
reasonable. Order of United Commercial Travelers of America
v. Wolfe, 331 U.S. 586, 608 (1947). Kraynak does not
dispute the validity of the agreement or the reasonableness
of the time period.