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Yelton v. ScanSource, Inc.

United States District Court, D. South Carolina, Greenville Division

November 18, 2013

Jeff Yelton, Plaintiff,
v.
ScanSource, Inc. & ScanSource Nonqualified Deferred Compensation Plan, Defendants

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[Copyrighted Material Omitted]

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For Jeff Yelton, Plaintiff: Brian P Murphy, LEAD ATTORNEY, Brian Murphy Law Firm, Greenville, SC.

For ScanSource Inc, ScanSource Nonqualified Deferred Compensation Plan, Defendants: Carmen Harper Thomas, LEAD ATTORNEY, Nelson Mullins Riley and Scarborough (Cola), Columbia, SC; William Stevens Brown, William H Foster, III, LEAD ATTORNEYS, Nelson Mullins Riley and Scarborough, Greenville, SC.

OPINION

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OPINION & ORDER

Henry M. Herlong, Jr., Senior United States District Judge.

This matter is before the court on Plantiff Jeff Yelton's (" Yelton" ) motion to strike portions of the administrative record, to supplement the administrative record, and for discovery. Yelton also moves the court to reconsider its September 9, 2013 Order granting in part Yelton's motion to stay the briefing deadline. Further, Yelton moves to strike docket numbers 36-2 and 38-2, and for leave to submit documents in camera. Finally, Defendants ScanSource, Inc. and ScanSource Nonqualified Deferred Compensation Plan (collectively " ScanSource" ) move the court to supplement the administrative record. After thorough review and for the reasons set forth below, the court denies Yelton's motion to strike portions of the administrative record, grants in part and denies in part Yelton's motion to supplement the administrative record, grants in part Yelton's motion for discovery, denies Yelton's motion for reconsideration as moot, denies Yelton's motion to strike docket numbers 36-2 and 38-2, and grants ScanSource's motion to supplement the administrative record

I. Factual and Procedural Background

This action arises under the Employee Retirement Income Security Act of 1974, 29 U.S.C. § § 1001, et seq. (" ERISA" ). Yelton filed a complaint in this court on April 22, 2013, alleging that ScanSource owed him ERISA benefits pursuant to 29 U.S.C. § 1132(a)(1)(B) and attorney's fees and costs pursuant to 29 U.S.C. § 1132(g). Pursuant to the court's Specialized Case Management Order, the parties filed a joint stipulation on August 19, 2013. (Joint Stipulation, ECF No. 12.) On August 23, 2013, counsel for ScanSource notified the court that it was " working with Plaintiff's counsel to resolve a dispute about the Administrative Record" because " [a]fter filing documents with [an] Amended Joint Stipulation on Tuesday, August 20, 2013, [ScanSource's counsel] realized that [they] had misunderstood what the Parties intended to be the Administrative Record." (Aug. 23, 2013 Letter, ECF No. 15.) On August 30, 2013, the clerk struck the submitted administrative record for noncompliance. (ECF No. 19.) On September 3, 2013, an amended joint stipulation was filed. (Am. Joint Stipulation, ECF No. 21.) Finally, on September 5, 2013, a second amended joint stipulation was filed with stipulated and disputed portions of the administrative record attached.

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(Second Am. Joint Stipulation, ECF No. 23.) The same day, Yelton filed a motion to stay the briefing deadline and requested a status conference. (Pl. Mot. Stay, ECF No. 22.) ScanSource consented to a fourteen-day extension, (Defs. Resp. Supp. Mot. Stay, ECF No. 25), and the court granted Yelton's motion in part on September 9, 2013, by extending the briefing deadline fourteen days. (Sept. 9 Text Order, ECF No. 26.)

On September 9, 2013, Yelton filed a motion to strike disputed portions of the administrative record, to supplement the record with attached exhibits, and to conduct discovery. (Pl. Mot. Strike, generally, ECF No. 27.) Yelton also filed a motion for reconsideration of the court's September 9 Order extending the briefing deadline by fourteen days. (Pl. Mot. Reconsider, ECF No. 28.) ScanSource responded to Yelton's motion to strike on September 26, 2013. (Defs. Resp. Opp'n Pl. Mot. Strike, ECF No. 38.) Yelton submitted his reply on October 7, 2013. (Pl. Reply Resp. Opp'n Mot. Strike, ECF No. 48.) On September 26, 2013, ScanSource responded to Yelton's motion for reconsideration. (Defs. Resp. Opp'n Mot. Reconsider, ECF No. 39.) Yelton did not reply to ScanSource's response.

On September 23, 2013, pursuant to the court's extended briefing deadline, Yelton and ScanSource submitted memoranda in support of judgment. (Defs. Mem. Supp. J., ECF No. 36.); (Pl. Mem. Supp. J., ECF No. 37.) On September 30, 2013, Yelton and ScanSource filed their replies. (Pl. Reply Defs. Mem. Supp. J., ECF No. 43.); (Defs. Reply Pl. Mem. Supp. J., ECF No. 44.) Yelton filed a motion to strike docket numbers 36-2 and 38-2, which are exhibits attached to ScanSource's memorandum in support of judgment and ScanSource's response to Yelton's motion to strike portions of the administrative record. (Pl. Mot. Strike Docket Entries, ECF No. 42.); (Defs. Mem. Supp. J. Ex. B (July 15, 2013 Letter), ECF No. 36-2.); (Defs. Resp. Opp'n Pl. Mot. Strike Ex. B (July 15, 2013 Letter), ECF No. 38-2.) On October 3, 2013, Yelton filed a motion for leave to submit documents in camera. (Pl. Mot. Leave Submit Docs., ECF No. 45.) On October 21, 2013, ScanSource consented to the motion. (Defs. Resp. Pl. Mot. Leave Submit Docs., ECF No. 51.) Finally, ScanSource filed a motion to supplement the administrative record on October 22, 2013, and Yelton filed his response on the same day. (Defs. Mot. Suppl. Admin. R., ECF No. 52.); (Pl. Resp. Defs. Mot. Suppl. Admin. R., ECF No. 53.) ScanSource submitted its reply on October 24, 2013. (Defs. Reply Mot. Suppl. Admin. R., ECF No. 54.) These matters are now ripe for review. [1]

II. Discussion of the Law

A. Yelton's Motion to Strike Disputed Portions of the Administrative Record

Yelton moves to strike the following disputed portions of the administrative record: 1) a letter from ScanSource in-house counsel to the plan administrative committee following Yelton's October appeal, (Second Am. Joint Stip. Ex. 41 (Nov. 28, 2012 Memorandum), ECF No. 23-46.); 2) indexes of documents submitted by ScanSource and Yelton, (Id. Ex. 42 (Indexes), ECF No. 23-47.); 3) ScanSource's Responses to Interrogatories in parallel state litigation, (Id. Ex. 43 (Defs. Second Suppl. Ans. Pls. First Interrogs.), ECF No. 23-48.); 4) a PowerPoint presentation prepared

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by ScanSource's counsel of record and used in the parallel state litigation, (Id. Ex. 44a (PowerPoint Presentation Slides), ECF No. 23-49.); (Id. Ex. 44b (PowerPoint Presentation Slides), ECF No. 23-50.); (Id. Ex. 44c (PowerPoint Presentation Slides), ECF No. 23-51.); (Id. Ex. 44d (PowerPoint Presentation Slides), ECF No. 23-52.); 5) a letter from ScanSource's counsel of record to the special referee in the parallel state litigation, (Id. Ex. 45 (Sept. 17, 2012 Letter), ECF No. 23-53.); 6) ScanSource's reply to Yelton's memorandum in opposition to a motion for a preliminary injunction in the parallel state litigation, (Id. Ex. 46 (Reply Pls. Mem. Opp'n Prelim. Inj.), ECF No. 23-54.); 7) a preliminary injunction issued in the parallel state litigation, (Id. Ex. 47 (Oct. 26, 2012 Order), ECF No. 23- 55.); and 8) search provider queries from Yelton's laptop, (Id. Ex. 48 (Search Provider Queries), ECF No. 23-56.). Yelton argues generally that the disputed documents should be struck because ScanSource " never identified the documents in the disputed portion of the administrative record [to Yelton] during the [administrative] process." (Pl. Mem. Supp. Mot. Strike 20, ECF No. 27- 1.) Yelton points specifically to ScanSource's failure to notify him of the existence of the letter from ScanSource in-house counsel to the plan administrative committee. (Id. 4-5, 8, ECF No. 27-1.) Further, Yelton vaguely argues or implies that the disputed portions of the record should be struck because ScanSource falsely represented in the initial joint stipulation that Yelton agreed that the disputed documents were part of the administrative record. ScanSource argues generally there is " no basis" to strike the materials. (Defs. Opp'n Pl. Mot. Strike, ECF No. 38.) The court agrees.

In the Fourth Circuit, the administrative record consists of " the facts known to [the administrator] at the time" it rendered its decision. Sheppard & Enoch Pratt Hosp., Inc. v. Travelers Ins. Co., 32 F.3d 120, 125 (4th Cir. 1994). Yelton has not shown that these materials were not before the plan administrator at the time of the decision. Yelton argues that the plan administrator violated a fiduciary duty during the review process. However, this argument is distinct from the issue of whether the materials were before the plan administrator when it made its decision. The cases Yelton cites in support of his argument are distinguishable from the case at bar. Yelton cites Vega v. National Life Insurance Services, Inc., 188 F.3d 287, 299 (5th Cir. 1999) (en banc), overruled in part by Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 128 S.Ct. 2343, 171 L.Ed.2d 299 (2008), in support of his argument that ScanSource had an " absolute obligation as fiduciaries under ERISA to make known such documents." (Pl. Mem. Supp. Mot. Strike 20, ECF No. 27-1.) Yelton also cites Robinson v. Aetna Life Insurance Co., 443 F.3d 389, 393-94 (5th Cir. 2006), arguing that " [i]nformation not disclosed in violation of ERISA's full and fair review requirements should not be relied upon by a reviewing district court" and that " it would be error to consider . . . materials outside the administrative record that were not identified to the claimant." [2] (Pl. Mem. Supp. Mot. Strike 20-21, ECF No. 27-1.) In Vega, the Fifth Circuit evaluated whether the court may consider documents that were not before the plan administrator, not whether courts

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must exclude documents that were before the plan administrator that were not known to the claimant during the administrative process. See Vega, 188 F.3d at 299. Further, in Robinson, the Fifth Circuit addressed the merits of a procedural challenge to the denial of benefits, not whether certain information was part of the administrative record. See Robinson, 443 F.3d at 393-94. Additionally, the Fifth Circuit explained that the district court should not have relied on evidence that was not before the plan administrator, not that the court should have excluded from the administrative record documents the existence of which the claimant was unaware. See id. Yelton has not shown a basis to strike the disputed documents on the ground that he was unaware of their existence during the administrative proceeding, and the motion to strike on this basis is denied.

Yelton's argument that the disputed documents should be struck because ScanSource's counsel falsely represented that he stipulated to their inclusion in the administrative record is without merit. Yelton cites no case law in support of his position. Further, Yelton has not shown that the misrepresentation was intentional or that he suffered any prejudice as a result. ScanSource notified the court of pending changes to the administrative record and the confusion between the parties as to which documents were stipulated to being in the record. See (Aug. 23, 2013 Letter, ECF No. 15.). Moreover, Yelton had the opportunity to file his motion to strike the disputed portions, which the court is currently resolving. As a result, the motion to strike the disputed documents on the ground that opposing counsel misrepresented Yelton's stipulation to their inclusion is denied.

Yelton offers additional arguments in support of striking specific disputed documents. Because the grounds vary for each document, those arguments are addressed individually below.

1. The Indexes of Documents Submitted by ScanSource and Yelton

Yelton moves to strike all disputed documents, and the indexes are included in the disputed documents. See (Pl. Mot. Strike, generally, ECF No. 27.). The indexes are lists generated by ScanSource that identify documents that were submitted to the committee by Yelton and by ScanSource in support of their positions. See (Second Am. Joint Stip. Ex. 42, Disp. R. 6-9 (Indexes of Documents), ECF No. 23-47.). Yelton has not asserted any argument as to why the indexes should be struck and has not shown that they were not before the plan administrative committee. Therefore, the motion to strike the indexes is denied.

2. ScanSource's Responses to Interrogatories

Yelton moves to strike ScanSource's responses to interrogatories in the parallel state litigation. Yelton argues that the responses to the interrogatories should be struck because they are " unsworn and unverified" and thus are not admissible evidence. (Pl. Mot. Strike 8, ECF No. 27-1.) Yelton also argues that the committee never cites the interrogatories as having been relied upon in its decision. (Id.) ScanSource does not address the interrogatories specifically. ScanSource generally asserts that the disputed documents contain evidence and were provided to the plan committee. (Defs. Opp'n Pl. Mot. Strike 12-13, ECF No. 38.)

The motion to strike ScanSource's responses to interrogatories is denied. If certain interrogatories contain inadmissible evidence, the court can accord them their proper weight. Moreover, Yelton

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fails to show that these documents were not before the committee when it ...


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