L-3 Beats Sex Bias Claim Over Transgender Breast Surgery

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Carmen Castro-Pagan

L-3 Communications Integrated Systems LP defeated a lawsuit by a transgender female employee who alleged L-3 and Aetna Life Insurance Co. discriminated against her by declining coverage for her breast implant surgery.

The worker didn’t provide any direct evidence of sex discrimination to support her Title VII of the Civil Rights Act of 1964 claim against L-3, Judge Sidney A. Fitzwater of the U.S. District Court for the Northern District of Texas held Jan. 26.

The worker’s allegations—that she was denied a medically necessary procedure based solely on her sex—wasn’t sufficient to allow the case to proceed, Fitzwater held.

Fitzwater’s ruling ends a three-year lawsuit by the worker, who transitioned from male to female to address her gender dysphoria. She sued both L-3 and Aetna for allegedly denying her disability benefits based on gender-identity discrimination in violation of the Employee Retirement Income Security Act, the Affordable Care Act, and Title VII.

Last year, Fitzwater dismissed some of the claims, holding that ERISA didn’t recognize such a bias claim. In May, Fitzwater further ruled that Aetna properly denied the woman disability benefits for her post-surgery recovery because it reasonably concluded that the surgery was for cosmetic purposes and not a medically necessary procedure aimed at treating an illness.

In her claim against L-3, the worker argued that because the Aetna health plan offered coverage for female-to-male mastectomies but not for male-to-female augmentation, it denied her a medically necessary procedure based solely on her sex.

Fitzwater rejected this argument, holding that the plan covered an alternative method for the addition of breasts in male-to-female transgender patients—hormone replacement therapy, which the plan covered on her behalf. In addition, the plan included a reconstructive surgery clause with broad language that could possibly encompass surgical procedures to add breasts in male-to-female transgender patients, provided the surgery isn’t performed primarily for cosmetic or beautifying purposes, Fitzwater said. As such, the policy isn’t discriminatory on its face and can’t serve as direct evidence of discrimination, he ruled.

Loncar Associates and Krummel Law represent the worker. Polsinelli PC represents L-3.

The case is Baker v. Aetna Life Ins. Co., 2018 BL 27127, N.D. Tex., No. 3:15-cv-03679-D, order granting defendant’s motion for summary judgment 1/26/18.

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