Firman v. Life Ins. Co. of N. Am.
| Decision Date | 15 June 2012 |
| Docket Number | No. 11–20451.,11–20451. |
| Citation | 684 F.3d 533 |
| Parties | Deborah FIRMAN, Plaintiff–Appellee, v. LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendant–Appellant. |
| Court | U.S. Court of Appeals — Fifth Circuit |
OPINION TEXT STARTS HERE
Peter M. Kelly, Law Office of Peter M. Kelly, P.C., James C. Plummer (argued), Plummer & Kuykendall, Houston, TX, for Plaintiff–Appellee.
Linda Patricia Wills (argued), Marjorie Leigh Cohen, Wilson, Elser, Moskowitz, Edelman & Dicker, L.L.P., Houston, TX, for Defendant–Appellant.
Appeal from the United States District Court for the Southern District of Texas; Ewing Werlein, Jr., Judge.
Before JOLLY, DeMOSS and STEWART, Circuit Judges.
Prior report: 789 F.Supp.2d 732.
In this ERISA case, the Life Insurance Company of North America (LINA) appeals the decision of the district court holding that LINA abused its discretion in its denial of benefits to the appellee, Deborah Firman. We have carefully reviewed the district court's opinion, heard oral arguments, and considered the arguments in the parties' briefs; and we are convinced that the district court correctly applied the law to the relevant facts and reached the appropriate legal conclusions. We emphasize the district court's holding that the common law definition of “accident” adopted in Todd v. AIG Life Insurance Co., 47 F.3d 1448, 1456 (5th Cir.1995), is controlling in all ERISA accidental death and dismemberment plans where the term “accident” is undefined, irrespective of whether the plan administrator is given discretion to interpret the plan. See generally, Stamp v. Metro. Life Ins. Co., 531 F.3d 84, 89 (1st Cir.2008) (). We therefore adopt the clear and well-reasoned opinion of the district court, a copy of which we attach hereto, as the opinion of this Court.
AFFIRMED.
APPENDIX
DEBORAH FIRMAN, Plaintiff,
v.
INSURANCE PLAN/502,1 and LIFE INSURANCE COMPANY OF NORTH AMERICA, Defendants.
Pending are Defendants' Motion for Summary Judgment (Document No. 23) and the Cross Motion for Summary Judgment of Plaintiff Deborah Firman (Document No. 53). After having considered the motions, responses, the applicable law, and the administrative record, the Court concludes as follows.
Plaintiff Deborah Firman claims, pursuant to ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), that Defendant Life Insurance Company of North America (“LINA”)2 wrongly denied her the benefits of her common-law husband's ERISA-governed Group Accident Policies. Her husband, Gilberto Espinoza, an employee of Houston-based Defendant Becon Construction Company, Inc. (“Becon”), participated in two accidental death and dismemberment policies under the Becon Personal Accident Insurance Plan/502 (the “Plan”)3: Group Accident Policy OK 826455 issued to Becon by LINA and LINA Voluntary Personal Accident Insurance Group Policy OK 822833 (together, the “Policies”),4 both of which named Plaintiff as the beneficiary.5 Becon was the ERISA Plan sponsor and administrator under the plan,6 but designated LINA as the claims administrator,7 and both policies conferred upon LINA “full discretionary authority to administer and interpret” both policies.8
Both Policies state that benefits will be paid for “loss from bodily injuries ... caused by an accident which happens while an insured is covered by this policy.”9 Neither policy, however, contains a definition of the term “accident.”
A. Insured's Death
Espinoza died in a single-vehicle crash in Kentucky on September 20, 2008. His blood and urine alcohol content were 0.20 percent and 0.35 percent, respectively, at the time of his death,10 and the investigating officer reported a “strong odor of alcohol” and “an open container of cold Budlight Beer inside the vehicle” upon his arrival.11 According to the officer's report, Espinoza's truck veered off the roadway to the right upon entering a left curve; Espinoza overcorrected, sending the truck over the road onto the left shoulder, where it rolled over.12 Espinoza was not wearing a seat belt, and he was partially ejected out of the passenger-side window and crushed by the vehicle.13 The crash occurred shortly after noon in clear weather and dry road conditions.14 The medical examiner who performed Espinoza's autopsy opined that the cause of death was “[m]ultiple blunt force injuries,” and marked the death as an “Accident,”15 which was also reflected on Espinoza's death certificate.16
B. LINA's Investigation and Denial of Benefits
Plaintiff made a claim for benefits under the Policies, which LINA received on December 4, 2008.17 It reviewed Plaintiff's claim, Espinoza's death certificate, the police report, the toxicology report, the medical report, and the Policies, then on December 23, 2008, informed Plaintiff that the claim was not covered because it was not an “accident.”18 LINA interpreted “accident” in the Policies to mean “a sudden, unforeseeable event,”19 and stated that Espinoza “would have been aware of the risks involved in operating his vehicle while under the influence” because “every state in the nation has criminalized drunk driving,” and therefore “[a]ll licensed motorists throughout the United States are on notice, by operation of law, of the state-declared prohibitions against drunk driving and its consequences.”20 The letter stated that Espinoza had an “alcohol level of 0.35%,” which it asserted was “more than four times the maximum level of alcohol in which it is legal to operate a motor vehicle in the state of Kentucky.”21 Because Espinoza “would have been aware of the risks involved in operating his vehicle while under the influence, his death was a foreseeable result of his actions and thus not an accident.”22
LINA also relied upon the “self-inflicted injury” exclusion in the Policies as a reason for denial. It noted that, by drinking and driving, Espinoza “placed his life and the lives of others in jeopardy” because “[i]t is commonly known that driving while intoxicated may result in death or bodily harm, as intoxication can lead to impaired judgment and decreased reflexes.”23 His death was therefore “a result of intentionally self-inflicted injuries,” and was excluded by the Policies.24
C. Plaintiff's Appeal
Plaintiff retained counsel and appealed LINA's decision in January 2009. 25 Her letter of appeal also advised LINA to consider it “as notice of her claim to pursue litigation, damages, statutory penalties, and attorney fees if this claim is not immediately resolved.”26 Her counsel pointed out that LINA's denial letter improperly compared Espinoza's urine alcohol content to Kentucky's legal blood alcohol limit for driving under the influence, 27 and subsequently submitted additional information consisting of affidavits of the investigating officer and medical examiner.28
The investigating officer asserted that he believed the curve on the road was dangerous for someone not familiar with the area, noting that he had investigated numerous accidents at the site.29 He further stated that, based on his investigation, there was no evidence that Espinoza intentionally caused the accident, knew it would occur, or reasonably could have anticipated his death.30 The medical examiner similarly found no evidence that Espinoza intended his death, nor that he reasonably could have anticipated it, because “ ‘driving under the influence’ does not naturally and probably lead to the type of injuries” that resulted in his death.31
Plaintiff's counsel also submitted Texas and Kentucky state case law interpreting accidental death insurance policies in the context of alcohol-related automobile crashes, concluding that under the law of either state, Espinoza's crash would be considered an “accident” under the Policies. 32
In response to these submissions, LINA informed Plaintiff that it was conducting a “home office review,” which was “needed in order to interpret the documents we have received as they relate to the provisionof this policy.”33 The claims administrator assigned to the appeal forwarded Plaintiff's contentions to LINA's in-house counsel,34 who responded with a five-page memo labeled “PRIVILEGED & CONFIDENTIAL ATTORNEY–CLIENT COMMUNICATION.”35 The memo opined that Plaintiff's relied-upon state law would be inapplicable to the interpretation of an ERISA policy governed exclusively by federal law: “The standard that claimant advances—one of natural and probable consequences—is not the standard utilized by federal courts applying the common law of ERISA.”36 It then noted the absence of Fifth Circuit authority regarding “whether an ERISA insured's death that occurs while driving when intoxicated is an accident in the context of [an] accidental death benefit plan,” and looked to decisions by the Fourth, Sixth, and Seventh Circuit Courts of Appeal as authority that, if LINA had discretion to make determinations under the Plan, it would not abuse that discretion by concluding that Espinoza's death was not an “accident” because “a reasonable person would foresee the likelihood of death or serious injury as a result of driving while intoxicated.”37 The memo also stated that the officer's and medical examiner's affidavits were not persuasive, because they were based not “on the facts of the incident, but on their personal view of whether it was natural and probable that Mr. Espinoza could not reasonably have foreseen his death.”38
LINA issued a letter to Plaintiff denying her appeal because:
Injury or death resulting from driving under the influence of alcohol is considered foreseeable and is not covered by the provisions of [the Policies]. Driving when intoxicated precludes a finding that a death is Accidental. As mentioned...
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