Anthony Polich v. Prudential Financial, Inc.

Filing

PER CURIAM OPINION FILED - THE COURT: JAMES B. LOKEN, STEVEN M. COLLOTON and SUSAN RICHARD NELSON (PUBLISHED) [3811756] [10-3100]

United States Court of Appeals
FOR THE EIGHTH CIRCUIT

___________
No. 10-3100
___________
Anthony Polich,
Appellant,
v.
Prudential Financial, Inc.,
Appellee.

*
*
*
* Appeal from the United States
* District Court for the
* Southern District of Iowa.
*
* [PUBLISHED]
*
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Submitted: March 15, 2011
Filed: July 27, 2011
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Before LOKEN and COLLOTON, Circuit Judges, and NELSON,1 District Judge.
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PER CURIAM.
Anthony Polich sued Prudential Financial, Inc., for breach of contract. Polich
contends that Prudential, which issued a group long-term disability insurance policy
to his employer, breached the policy by denying his claim for disability benefits. The
district court2 granted Prudential’s motion for summary judgment, and we affirm.

1

The Honorable Susan Richard Nelson, United States District Judge for the
District of Minnesota, sitting by designation.
2

The Honorable Ronald E. Longstaff, United States District Judge for the
Southern District of Iowa.

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Polich worked as a veteran career consultant for the State of Iowa from 1997
until 2006, when he resigned because of an alleged disability. He was covered by a
long-term disability insurance policy issued to the State by a wholly-owned subsidiary
of Prudential. On July 20, 2006, the State submitted on Polich’s behalf an application
for benefits under the policy. Polich asserted in the application that he was unable to
work because he suffered from Ménière’s disease – a disease of the inner ear – and
post-traumatic stress disorder (PTSD). The application included an attending
physician’s statement, prepared by a clinical psychologist, which identified Polich’s
“Impairment/Limitation” as “Cognitive Disorder NOS,” i.e., not otherwise specified.
The statement listed as a “Corresponding Medical Restriction[]” that Polich was
“unable to work due to dizzy spells,” and included “PTSD with depression [and]
anxiety”as a non-medical factor significantly impacting Polich’s functional abilities.
On October 4, 2006, Prudential denied Polich’s claim on the ground that he was
not disabled. On December 29, 2006, Prudential’s Appeal Review Unit upheld the
denial on Polich’s first administrative appeal, but advised Polich that he “may again
appeal” to the Appeal Review Unit for “a final decision.” Polich, through counsel,
notified Prudential on January 22, 2007, of his intent to appeal again, and Prudential
explained in February that Polich’s complete appeal must be submitted by July 12,
2007. Polich supplemented his appeal with additional materials on April 12 and June
27. On July 11, Prudential acknowledged receipt of the appeal, explained that it was
“performing a thorough evaluation,” and stated that it “anticipate[d]” making a
determination by August 14, 2007.
On or about July 11, Prudential arranged for an independent medical
examination (IME) of Polich by a neuropsychologist to facilitate review of its decision
that Polich was not disabled because of depression, anxiety, PTSD, or cognitive
disorder NOS. Polich was notified on July 23 that an examination was scheduled for
August 13. Polich refused to attend the IME. Prudential then arranged for a
neuropsychologist to conduct a review of Polich’s claim file, and asked Polich on July
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30 to release the “raw data” from the examination that was the basis for the attending
physician statement in Polich’s application. Polich again declined to comply with
Prudential’s request. So Prudential arranged for a neuropsychologist to review the
information already in Polich’s file. The neuropsychologist concluded that the
information did not show that Polich had a psychological or cognitive impairment,
and Prudential also concluded that Polich failed to prove that he was unable to work
because of Ménière’s disease. On August 17, Prudential denied Polich’s appeal on
the ground that he was not disabled.
Following the denial of his second appeal, Polich sued Prudential in state court
for breach of the policy. Prudential removed the case to federal court and filed a
motion for summary judgment. Prudential argued that when Polich refused to attend
the IME and to release the raw data, he failed to comply with two policy provisions
that were conditions precedent to coverage. One provision states that Prudential can
require an insured “to be examined by doctors” of its choice “as often as it is
reasonable to do so,” and that “[r]efusal to be examined . . . may result in denial or
termination of” the insured’s claim. The other provides that “[i]n some cases,” the
insured “will be required to give Prudential authorization to obtain additional medical
information,” and that “Prudential will deny [the insured’s] claim . . . if the
appropriate information is not submitted.” According to Prudential, Polich’s claims
failed as a matter of law due to his noncompliance. The district court agreed and
granted the motion for summary judgment. We review that decision de novo. Veatch
v. Bartels Lutheran Home, 627 F.3d 1254, 1257 (8th Cir. 2010).
To recover for breach of an insurance contract under Iowa law, which governs
in this diversity action, Polich must prove that he substantially complied with all
conditions precedent to coverage, that Prudential waived compliance, that a failure to
comply was excused, or that a failure to comply did not prejudice Prudential. Simpson
v. U.S. Fid. & Guar. Co., 562 N.W.2d 627, 631 (Iowa 1997). Polich does not
challenge the district court’s conclusion that the policy provisions at issue established
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conditions precedent to coverage, cf. Met-Coil Sys. Corp. v. Columbia Cas. Co., 524
N.W.2d 650, 655 n.5 (Iowa 1994); Watson v. Nat’l Sur. Corp., 468 N.W.2d 448, 450
(Iowa 1991), so we take that as a given. Rather, Polich notes that the IME provision
requires only that he comply with reasonable requests for an IME, and he argues that
Iowa law applies an identical reasonableness requirement to requests under the
provision calling for the release of medical records upon request. Polich then
contends that whether Prudential’s requests were reasonable is a question of fact for
the jury.3
According to Polich, a reasonable jury could conclude that the requests were
unreasonable, because Prudential’s claim file already contained “voluminous medical
reports and opinions” on which Prudential twice had relied to deny his claim. Polich
notes that Prudential did not request an IME or the raw data before denying his first
appeal, even though the claim file then included the same evidence about his
psychological and cognitive condition. He also observes that a medical professional
recommended, before the denial of Polich’s initial claim, that Prudential request the
raw data, but the data were not requested until the second appeal. Reasonableness
often is a jury question, but where only one reasonable conclusion can be drawn from
undisputed historical facts, the question can be resolved by the court. Evanston Ins.
Co. v. OEA, Inc., 566 F.3d 915, 920 (9th Cir. 2009); Westra v. Credit Control of
Pinellas, 409 F.3d 825, 827 (7th Cir. 2005); see also Met-Coil Sys. Corp., 524 N.W.2d
at 656.
We conclude that Prudential’s requests for an IME and raw data in connection
with Polich’s second appeal were reasonable as a matter of law. The claim file
contained conflicting evidence regarding whether Polich had a psychological or
3

Polich also argues on appeal that Prudential waived compliance with the policy
provisions and that Prudential was not prejudiced by his failure to comply, but he did
not raise these arguments before the district court, and we therefore decline to
consider them. See Campbell v. Davol, Inc., 620 F.3d 887, 891 (8th Cir. 2010).
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cognitive impairment, but Prudential’s first two decisions found that Polich had not
established disability. Polich was not required to pursue a second administrative
appeal with Prudential, but when he continued to dispute the insurer’s conclusion and
asked again for reconsideration, it surely was reasonable for Prudential to gather
additional relevant information as part of its reexamination of the earlier decisions.
Prudential requested the IME less than one month after Polich submitted his complete
second appeal, and it requested the raw data seven days after Polich declined to attend
the IME. After Polich refused to comply, Prudential proceeded with an expert’s
review of the existing file and issued a final decision on August 17.
Polich makes much of the fact that Prudential notified him on July 11 that it
“anticipate[d]” making a determination by August 14, but then scheduled the IME for
August 13. The policy, however, placed no time limit on administrative appeals, and
Prudential’s estimated date of decision was gratuitous. The relevant question is
whether it was reasonable for Prudential on July 23 to request an IME in response to
an appeal submitted by Polich on June 27. We agree with the district court that this
request, and the prompt subsequent request for raw data in lieu of an examination,
were reasonable as a matter of law.
The judgment of the district court is affirmed.
______________________________

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