Foraker v. USAA Casualty Insurance Company
Filing
139
AMENDED OPINION AND ORDER: The Court GRANTS in part and DENIES in part Plaintiffs Motion 103 for Partial Summary Judgment as follows: The Court grants Plaintiff's Motion as to the issue of fault and finds as a matter of law that Neira w as 100% at fault for the accident and denies Plaintiff's Motion as to whether the injuries for which Plaintiff incurred the medical expenses were caused by the accident and whether the unpaid medical expenses were reasonable and necessary. The Court also DENIES as moot Plaintiff's Motion 132 to Strike. See 19-page amended opinion and order attached. Signed on 5/18/2015 by Judge Anna J. Brown. (mr)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PEGGY FORAKER,
3:14-cv-00087-BR
Plaintiff,
v.
USAA CASUALTY INSURANCE COMPANY,
a Texas corporation,
Defendant.
HEATHER A. BRANN
P.O. Box 11588
Portland, OR 97211
(503) 490-6563
JAMES R. JENNINGS
1550 N.W. Eastman Parkway, Suite 275
Gresham, OR 97030
(503) 669-3406
STEPHEN C. HENDRICKS
Hendricks Law Firm, PC
1425 S.W. 20th Avenue, Suite 201
Portland, OR 97201
(503) 241-5629
Attorneys for Plaintiff
1 - AMENDED OPINION AND ORDER
AMENDED OPINION
AND ORDER
JOSHUA N. KASTAN
ROBERT S. MCLAY
Hayes Scott Bonino Ellingson & McLay, LLP
203 Redwood Shores Parkway, Suite 480
Redwood City, CA 94065
(650) 637-9100
MATTHEW C. CASEY
Bullivant Houser Bailey, PC
300 Pioneer Tower
888 S.W. Fifth Avenue
Portland, OR 97204
(503) 499-4478
Attorneys for Defendant
BROWN, Judge.
This matter comes before the Court on Plaintiff Peggy
Foraker’s Motion (#103) for Partial Summary Judgment and
Plaintiff’s Motion (#132) to Strike Inadmissible Documents Filed
by USAA in Opposition to Plaintiff’s Motion for Summary Judgment.
The Court heard oral argument on these Motions on May 13, 2015.
For the reasons that follow, the Court DENIES Plaintiff’s
Motion for Summary Judgment and DENIES as moot Plaintiff’s Motion
to Strike.
BACKGROUND
The following facts are undisputed and taken from the
parties’ submissions on summary judgment:
I.
Factual Background
Plaintiff was injured in a two-car automobile collision on
2 - AMENDED OPINION AND ORDER
January 4, 2012, when Plaintiff’s car collided with the car of
Adrian Neira.
At the time of the collision Neira was fleeing
police and driving the wrong way down a one-way street.
Defendant insured Plaintiff and her automobile under an
insurance policy that provided $50,000 in “Additional Personal
Injury Protection” (PIP), $100,000 on Medical Payments (MedPay),
and $1,000,000 in Uninsured Motorist (UM) benefits.
Neira was
uninsured.
Plaintiff’s PIP coverage provided Defendant would pay for
“medical and hospital expenses . . . incurred with respect to
bodily injury sustained by a covered person and caused by an
accident arising from the use, occupancy, or maintenance of any
motor vehicle.”
Plaintiff’s MedPay coverage provided Defendant
would pay the “reasonable fee for medically necessary and
appropriate medical services” that “[r]esult from bodily injury
sustained by a covered person in an auto accident.”
Plaintiff’s
UM coverage provided Defendant would pay “compensatory damages
which a covered person is legally entitled to recover from the
owner or operator of an uninsured motor vehicle because of . . .
[b]odily injury sustained by a covered person, and caused by an
auto accident.”
On January 5, 2012, Plaintiff reported the accident to
Defendant and made PIP and MedPay claims.
UM claim.
Plaintiff later made a
Defendant accepted coverage under PIP and MedPay and
3 - AMENDED OPINION AND ORDER
between February 6, 2012, and February 20, 2013, Defendant paid
$159,329.76 to Plaintiff for covered medical expenses under the
PIP and MedPay portions of the policy.
On February 20, 2013,
Defendant advised Plaintiff and her medical providers that
Defendant’s payments exhausted the limits of Plaintiff’s MedPay
and PIP coverages.
For each payment that Defendant made under PIP and MedPay,
Defendant provided an Explanation of Reimbursement (EOR).
The
EOR explains any reduction of the payment or any refusal ro
provide coverage.
The largest portion of Plaintiff’s medical bills related to
brain surgery that Plaintiff underwent at the University of
California Los Angeles (UCLA) Medical Center to treat
hydrocephalus.
Initially Defendant issued EORs in which
Defendant rejected the bills from UCLA on the basis that
Plaintiff’s hydrocephalus was not related to the accident.
After
reconsideration, however, Defendant chose to pay a portion of the
bills for the brain surgery at UCLA under Plaintiff’s PIP and
MedPay coverage.
Defendant initially considered the opinion of a
reviewing physician who suggested Plaintiff’s hydrocephalus could
be caused by Plaintiff’s age rather than by the accident, but
Defendant ultimately concluded “all medical providers indicate
that the brain surgery is related to” the accident.
insurance adjuster specifically noted:
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Defendant’s
“[I]n non[e] of her
medical records does [Plaintiff] indicate any significant medical
history relating to this type of injury.”
Accordingly, Defendant
concluded Plaintiff’s hydrocephalus and the brain surgery to
treat that condition were due to the accident.
In addition,
Defendant concluded Neira was 100% at fault for the accident.
Defendant accordingly paid over $31,000.00 in medical
expenses related to the brain surgery at UCLA.
This payment
exhausted the policy sub-limits for PIP and MedPay.
In total Plaintiff incurred:
1.
$233,458.20 in medical expenses related to diagnosis and
treatment of hydrocephalus (including the UCLA brain surgery), of
which Defendant paid $81,676.03;
2.
$61,111.00 in medical expenses for diagnosis and
surgical treatment of a cervical-disc injury, of which Defendant
paid $46,235.76;
3.
$13,053.34 in medical expenses related to diagnosis and
treatment of an additional neck and back injury, of which
Defendant paid $8,873.86;
4.
$14,141.00 in medical expenses related to diagnosis and
treatment of a shoulder injury, of which Defendant paid
$6,466.63;
5.
$12,547.90 in medical expenses related to diagnosis and
treatment of bilateral hand injuries, of which Defendant paid
$8,556.33;
5 - AMENDED OPINION AND ORDER
6.
$10,773.36 in medical expenses for office visits,
medical imaging, and additional miscellaneous injuries, of which
Defendant paid $4,172.83;
7.
$3,269.00 in medical expenses for diagnosis and
treatment of traumatic brain injury, of which Defendant paid
$2,486.69; and
8.
$1,569.00 in medical expenses for diagnosis and
treatment of an inner-ear concussive injury, of which Defendant
paid $859.63.
As noted, Defendant made each of the above payments under
the PIP and MedPay coverages.
After the PIP and MedPay policy
sub-limits were exhausted, Plaintiff began pursuing a UM claim
for outstanding medical expenses and additional economic and
noneconomic damages.
Defendant has not made any payment under
Plaintiff’s UM coverage.
At the time that Defendant made the
payments for Plaintiff’s PIP and MedPay claims, Defendant did not
issue any reservation of rights that expressly reserved to
Defendant the right to make a contrary determination under a UM
claim.
II.
Procedural Background
Plaintiff brings three claims against Defendant:
Plaintiff
alleges Defendant breached the insurance contract by refusing to
make payments under the UM coverage (Claim One); Plaintiff
alleges Defendant’s refusal to pay UM benefits violated the
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Elderly Persons and Person with Disabilities Abuse Prevention
Act, Oregon Revised Statues § 124.005, et seq. (Claim Two); and
Plaintiff alleges Defendant’s actions in denying benefits under
the UM coverage breached Defendant’s contractual implied covenant
of good faith and fair dealing (Claim Three).
On April 23, 2014, the Court dismissed without prejudice
Claim Two as premature and with leave to amend if and when the
amount of any money that Defendant may owe to Plaintiff is
actually determined.
On August 28, 2014, the Court bifurcated
the proceedings to allow the parties to litigate Plaintiff’s UM
claim (Claim One) to conclusion before litigating Claim Three.
PLAINTIFF’S MOTION (#103) FOR SUMMARY JUDGMENT
I.
Standards
Summary judgment is appropriate when there is not a “genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.”
Washington Mut. Ins. v. United
States, 636 F.3d 1207, 1216 (9th Cir. 2011).
Civ. P. 56(a).
See also Fed. R.
The moving party must show the absence of a
dispute as to a material fact.
Rivera v. Philip Morris, Inc.,
395 F.3d 1142, 1146 (9th Cir. 2005).
In response to a properly
supported motion for summary judgment, the nonmoving party must
go beyond the pleadings and show there is a genuine dispute as to
a material fact for trial.
Id.
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"This burden is not a light one
. . . .
The non-moving party must do more than show there is
some 'metaphysical doubt' as to the material facts at issue."
In
re Oracle Corp. Sec. Litig., 627 F.3d 376, 387 (9th Cir. 2010)
(citation omitted).
A dispute as to a material fact is genuine "if the evidence
is such that a reasonable jury could return a verdict for the
nonmoving party."
Villiarimo v. Aloha Island Air, Inc., 281 F.3d
1054, 1061 (9th Cir. 2002)(quoting Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986)).
The court must draw all
reasonable inferences in favor of the nonmoving party.
v. Verity, Inc., 606 F.3d 584, 587 (9th Cir. 2010).
Sluimer
"Summary
judgment cannot be granted where contrary inferences may be drawn
from the evidence as to material issues."
Easter v. Am. W. Fin.,
381 F.3d 948, 957 (9th Cir. 2004)(citing Sherman Oaks Med. Arts
Ctr., Ltd. v. Carpenters Local Union No. 1936, 680 F.2d 594, 598
(9th Cir. 1982)).
A “mere disagreement or bald assertion” that a genuine
dispute as to a material fact exists “will not preclude the grant
of summary judgment.”
Deering v. Lassen Cmty. Coll. Dist., No.
2:07-CV-1521-JAM-DAD, 2011 WL 202797, at *2 (E.D. Cal., Jan. 20,
2011)(citing Harper v. Wallingford, 877 F.2d 728, 731 (9th Cir.
1989)).
2010).
See also Moore v. Potter, 701 F. Supp. 2d 1171 (D. Or.
When the nonmoving party's claims are factually
implausible, that party must "come forward with more persuasive
8 - AMENDED OPINION AND ORDER
evidence than otherwise would be necessary."
LVRC Holdings LLC
v. Brekka, 581 F.3d 1127, 1137 (9th Cir. 2009)(citing Blue Ridge
Ins. Co. v. Stanewich, 142 F.3d 1145, 1149 (9th Cir. 1998)).
The substantive law governing a claim or a defense
determines whether a fact is material.
Miller v. Glenn Miller
Prod., Inc., 454 F.3d 975, 987 (9th Cir. 2006).
If the
resolution of a factual dispute would not affect the outcome of
the claim, the court may grant summary judgment.
II.
Id.
Discussion
In her Motion for Partial Summary Judgment Plaintiff seeks
summary judgment as to (1) the causal connection between the
accident and the medical conditions for which Defendant has paid
for some treatment, (2) the reasonableness and necessity of the
medical expenses incurred by Plaintiff, and (3) the comparative
fault in the accident.
In particular, Plaintiff contends (1) she is entitled to
summary judgment as to the reasonableness and necessity of all
medical expenses she incurred because, as a matter of law, the
proper measure of damages is the gross amount of her medical
bills; (2) Defendant, by determining causation in Plaintiff’s
favor during review of Plaintiff’s PIP and MedPay claims, waived
its right to take inconsistent positions on that issue with
regard to Plaintiff’s UM claim; and (3) there is not any genuine
dispute of material fact as to whether Neira was 100% at fault
9 - AMENDED OPINION AND ORDER
for the accident.
A.
Reasonableness and Necessity - Measure of Damages
As noted, Plaintiff contends she is entitled to summary
judgment as to the reasonableness and necessity of the medical
expenses she incurred because the measure of damages is, as a
matter of law, the full amount of her medical expenses.
To
support her position Plaintiff relies exclusively on White v.
Jubitz Corp., 347 Or. 212, 242 (2009), in which the Oregon
Supreme Court held:
[T]he plaintiff in a personal injury action is entitled
to claim and recover from a tortfeasor the reasonable
value of the medical services charged without
limitation to the sums for which plaintiff is legally
liable, that plaintiff has paid for those services, or
that a third party has paid on plaintiff's behalf.
White, however, is distinguishable from this case.
The
issue in White was whether the measure of damages was reduced by
the actions of a third party that operated to reduce the amount
that the plaintiff actually paid rather than, as here, whether
the full amount of medical expenses was per se reasonable.
In
White the Oregon Supreme Court held the third party’s reduction
in the amount of medical expenses that the plaintiff actually
paid did not reduce the full measure of damages and that the
plaintiff was instead entitled to the “reasonable value of the
medical services charged” regardless of the effect of the third
party’s actions.
Id. at 231-43.
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Moreover, White does not support Plaintiff’s particular
argument.
Rather than providing that the full measure of
Plaintiff’s medical expenses are per se reasonable and necessary
as a matter of law, White actually begs the question that
Plaintiff contends it answers.
As the Oregon Supreme Court made
clear, a plaintiff in a personal-injury action is entitled to
“the reasonable value of the medical services charged.”
242 (emphasis added).
Id. at
Thus, even under White a personal-injury
plaintiff must still establish that the value of the services
rendered was reasonable.
Here the Court cannot conclusively
determine on this record whether the full extent of the medical
expenses incurred by Plaintiff but not paid by Defendant were
“reasonable and necessary” and that Defendant, therefore, had a
duty to pay them (assuming the other elements of coverage are
satisfied).
Accordingly, on this record the Court concludes Plaintiff is
not entitled to summary judgment as to the reasonableness and
necessity of the claimed medical expenses that were not paid by
Defendant.
B.
Causation - Contractual Waiver
As noted, Plaintiff contends Defendant waived the right to
now assert Plaintiff’s injuries were not caused by the accident
when Defendant, by paying the PIP and MedPay claims, determined
Plaintiff’s injuries were, in fact, caused by the accident.
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“Waiver is the voluntary relinquishment of a known right.”
Bennett v. Farmers Ins. Co. of Oregon, 332 Or. 138, 156 (2001).
“A party to a written contract may waive a provision of that
contract by conduct or by oral representation.”
Id.
“The doctrine of waiver applies broadly to any contract
term.”
Wright v. State Farm Mut. Auto. Ins. Co., 223 Or. App.
357, 368 (2008).
“In the context of an insurance contract
specifically, ‘[c]onduct of an insurer after a loss has occurred
that is inconsistent with a particular defense, especially where
the insured has been . . . led to believe there is coverage, will
constitute a waiver of the defense.’”
Id. at 369 (quoting
Williston on Contracts § 41:26 (4th ed. 2000)).
“However, waiver ‘cannot be the basis for creating a
contract of coverage where no such contract previously existed.’”
Farmers Ins. Co. of Oregon v. Munson, 127 Or. App. 413, 418
(1994)(quoting Schaffer v. Mill Owners Ins. Co., 242 Or. 150, 156
(1965)).
Accordingly, “[w]aiver may be available to prevent an
insurer from asserting a policy defense if the defense is a
condition of forfeiture, but not if it is a condition of
coverage.”1
Id. at 418.
See also Wright, 223 Or. App. at 369
(noting although the universe of insurance limitations is not
1
Although Plaintiff frames her argument in terms of waiver,
the Court notes this rule is the same in the context of the
related doctrine of estoppel. See Richardson v. Guardian Life
Ins. Co. of America, 161 Or. App. 615, 624-25 (1999).
12- AMENDED OPINION AND ORDER
exclusively bifurcated between conditions of coverage and
conditions of forfeiture, a condition of coverage is,
nonetheless, not waiveable).
“A condition of forfeiture is one ‘where there is insurance
coverage for the loss in the first place,’ but acts of the
insured, such as the filing of a false statement of loss, nullify
the coverage.”
Munson, 127 Or. App. at 418 (quoting ABCD . . .
Vision, Inc. v. Fireman’s Fund Ins. Cos., 304 Or. 301, 307
(1987)).
If, on the other hand, a condition determines “whether
there is coverage in the first place,” it is a condition of
coverage and, therefore, cannot be waived.
Id.
The causation provision is a condition of coverage.
By its
terms the policy only covers those medical expenses that are
incurred to diagnose and to treat injuries that are caused by the
loss.
Accordingly, the causation provision that Plaintiff
contends Defendant waived by resolving that issue, in effect, in
Plaintiff’s favor with regard to Plaintiff’s PIP and MedPay
claims determines whether there is coverage for the injury under
the terms of the policy in the first place.
Thus, the Court
concludes the causation provision is a condition of coverage that
Defendant could not waive.2
See Munson, 127 Or. App. at 418.
2
The Court notes, however, that evidence regarding
Defendant’s causation determination in the context of Plaintiff’s
PIP and MedPay claims may be admissible as to whether the
accident caused the now-disputed injuries in the context of
Plaintiff’s UM claim.
13- AMENDED OPINION AND ORDER
Relying on Wright and Grisby v. Progressive Preferred
Insurance Co., 343 Or. 175 (2007), Plaintiff contended at oral
argument that the causation condition in her UM coverage is not a
condition of coverage.
Plaintiff’s reliance on Wright and Grisby
to support her position, however, is misplaced.
In Wright the Oregon Supreme Court noted the insured’s UM
coverage had a two-year limitation period that required the
insured to file suit against the insurer within two years of the
loss if there was a dispute as to coverage.
The Oregon Supreme
Court held this provision was not a condition of coverage, but
rather was a “suit limitation provision” that could be waived.
Wright, 223 Or. App. at 368-71.
Unlike the suit-limitation
provision in Wright, however, the causation condition at issue
here is a necessary element that determines the existence of
coverage in the first instance.
In other words, in Wright the
suit-limitation provision operated to provide a window in which
the insured must take action in order to collect benefits on her
coverage, but under Plaintiff’s UM coverage in this case if the
injury was not caused by the covered accident, then coverage for
that injury does not and never did exist.
Accordingly, the
Court’s conclusion that the causation condition is a condition of
coverage is not inconsistent with Wright.
In Grisby an insurer concluded the insured’s injury was
caused by the accident, but, nonetheless, the insurer determined
14- AMENDED OPINION AND ORDER
the chiropractic treatment that the insured received was not
related to the accident.
The issue before the Oregon Supeme
Court was whether the insurer had “accepted coverage” within the
meaning of the attorneys’ fees safe-harbor provision in Oregon
Revised Statute § 742.061(2)(a).
The court held the insurer had
not “accepted coverage” because
whether an insurer has ‘accepted coverage’ . . . is not
limited to a one-time decision by the insurer that a
particular accident is within the scope of a policy
that it had issued (and that the insurer now has
obligations under that policy), but rather is an
ongoing series of decisions ‘accepting’ or ‘denying’
coverage of particular claims for services rendered by
medical providers.
Grisby, 343 Or. at 181.
Thus, the Grisby court did not address
the question presented here (i.e., whether a causation condition
is a condition of coverage), and, therefore, the Grisby court’s
reasoning does not resolve the question raised by Plaintiff’s
Motion.
Although the Grisby court adopted a broad view as to
whether an insurer “accepted coverage,” the court’s
interpretation of that phrase does not shed light on which
conditions make up the necessary elements of that coverage.
Accordingly, Grisby is not inconsistent with this Court’s
conclusion that the causation condition in Plaintiff’s UM
coverage is a condition of coverage.
On this record, therefore, the Court concludes the causation
condition in Plaintiff’s UM provision is a condition of coverage,
and, therefore, Defendant did not waive the causation condition
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with respect to Plaintiff’s UM claim by paying Plaintiff’s PIP
and MedPay claims.3
C.
Fault - Genuine Dispute of Material Fact
Finally, Plaintiff contends she is entitled to summary
judgment as to the issue of fault for the accident because it is
materially undisputed that Neira was 100% at fault for the
accident.
Defendant, in turn, contends a genuine dispute of
material fact exists as to fault for the accident based on two
facts in the record:
(1) Plaintiff acknowledged she
“unsuccessfully attempted to accelerate out of the way of the
rapidly approaching assailant but could not avoid the collision”
and (2) the fact that Neira was fleeing the Portland police at
the time of the accident creates a genuine dispute of material
fact as to the comparative fault of the Portland police (an
insured party whose shoes Defendant would not be required to fill
as to the UM coverage).
It is undisputed that the accident occurred when Plaintiff’s
vehicle was struck by Neira while Neira was going the wrong way
down a one-way street.
Defendant concluded in its investigation
3
Plaintiff’s waiver argument notwithstanding, the Court
notes there is a genuine dispute of material fact as to whether
the injuries for which Plaintiff incurred the medical expenses
were, in fact, caused by the accident. Moreover, as noted at
oral argument, the fact that Defendant may have “admitted” the
causal connection by paying for certain services it now wishes to
contest may be admissible at trial as an admission and go to the
weight of the evidence generally on the disputed causation
questions.
16- AMENDED OPINION AND ORDER
of the accident that Neira was 100% at fault for the accident.
In addition, Defendant decided not to pursue a subrogation claim
against the Portland police because Defendant concluded they did
not begin to pursue Neira until after the collision.
On this record the Court concludes Plaintiff has carried her
burden to demonstrate the absence of any genuine dispute of
material fact regarding fault for the accident.
The only facts
that Defendant points to as creating a genuine dispute do not
negate the clear evidence regarding fault.
In addition, the mere
fact that Plaintiff attempted unsuccessfully to avoid the
collision, without more, does not establish Plaintiff did so
negligently.
Moreover, the fact that Neira was fleeing police at
the time of the accident does not create a genuine dispute of
material fact as to the potential fault of the Portland police
because it is undisputed that the police did not begin pursuing
Neira until after the collision.
The record reflects both
Plaintiff and Defendant have operated on the basis that neither
Plaintiff nor the Portland police were at fault for the accident
since October 2012 at the latest when Defendant completed its
analysis of a possible subrogation claim against the Portland
police.
Thus, there is not any evidence in the record from which
a reasonable jury could conclude the Portland police are
partially at fault for the accident.
Accordingly, on this record the Court concludes Plaintiff is
17- AMENDED OPINION AND ORDER
entitled to summary judgment on the issue of comparative fault
and has established as a matter of law that Neira was 100% at
fault for the collision.
PLAINTIFF’S MOTION (#132) TO STRIKE
Plaintiff moves to strike many of the factual materials
Defendant submitted along with its opposition to Plaintiff’s
Motion for Summary Judgment.
The evidence Plaintiff moves the
Court to strike, however, did not affect the Court’s resolution
of the Motion for Summary Judgment.
Accordingly, on this record the Court denies Plaintiff’s
Motion to Strike as moot.
CONCLUSION
For these reasons, the Court GRANTS in part and DENIES in
part Plaintiff’s Motion (#103) for Partial Summary Judgment as
follows:
The Court grants Plaintiff’s Motion as to the issue of
fault and finds as a matter of law that Neira was 100% at fault
for the accident and denies Plaintiff’s Motion as to whether the
injuries for which Plaintiff incurred the medical expenses were
caused by the accident and whether the unpaid medical expenses
were reasonable and necessary.
18- AMENDED OPINION AND ORDER
The Court also DENIES as moot Plaintiff’s Motion (#132) to
Strike.
IT IS SO ORDERED.
DATED this 18th day of May, 2015.
/s/ Anna J. Brown
ANNA J. BROWN
United States District Judge
19- AMENDED OPINION AND ORDER
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