Curtiss v. Union Cent. Life Ins. Co.

Citation823 F. Supp. 851
Decision Date31 March 1993
Docket NumberCiv. A. No. 92-F-1915.
PartiesMary Jo CURTISS and RJR Circuits, Inc., a Colorado corporation, Plaintiffs, v. UNION CENTRAL LIFE INSURANCE COMPANY, an Ohio corporation, Defendant.
CourtU.S. District Court — District of Colorado

John P. Serini, John P. Serini, P.C., Denver, CO, for plaintiffs.

Stuart Pack, Stuart Pack, P.C., Denver, CO, for defendant.



This is a case involving a claim for life insurance benefits. This matter comes before the Court on the motions for summary judgment and motions to strike of Defendant Union Central Life Insurance Company ("the Company"). Removal jurisdiction is based on 28 U.S.C.A. § 1332. The litigants have fully briefed the matter. For the reasons stated below, the motion for summary judgement is DENIED and the motions to strike are DENIED.


Plaintiffs, RJR Circuits, Inc. ("RJR") and Mary Jo Curtiss, allege that Joseph Curtiss, former General Manager of RJR, was covered by a life insurance policy ("the Policy") purchased by RJR and issued by the Company.1 Mr. Curtiss' application for life insurance consisted of four documents: (1) Part I — Application for Insurance signed and dated November 18, 1991; (2) Part II — Medical Application to the Union Central Life Insurance Company — Cincinnati, signed and dated November 21, 1991; (3) Amendment of Application signed and dated November 18, 1991; and (4) Amendment of Application signed and dated December 11, 1991. As of December 17, 1991, RJR and Mrs. Curtiss were named equal and primary beneficiaries of the Policy. RJR had also purchased life insurance policies for its two co-owners in 1985 and for two of its other managers on a date not disclosed in the record. On or about January 1, 1992, the Company issued the Policy in the amount of $100,000 insuring the life of Mr. Curtiss.

Joseph Curtiss died on February 29, 1992. Plaintiffs submitted their Statement of Claim and Request for Payment in March 1992. On June 26, 1992, the Company wrote to Mrs. Curtiss and rejected Plaintiffs' claim. The Company informed her that its contestable claim investigation had determined Mr. Curtiss had failed to furnish certain health-related information, specifically, both his December 1991 visits to two doctors, including a urologist, with complaints of abdominal pain, and his doctors' discovery of possible testicular cysts. The Company stated that had Mr. Curtiss provided this information, his application for an insurance policy would not have been approved. The Company cited provisions in the Policy stating the Policy had been granted on the condition that Mr. Curtiss' answers to its questionnaire were true and complete, and that the Company could void the Policy if the answers were inadequate. The Company returned all premiums with interest.

Plaintiffs brought this suit alleging state law claims for breach of contract, negligence, and bad faith. In the Joint Stipulated Plan and Schedule for Discovery, Plaintiffs indicated they are also pursuing a bad faith claim under Colorado's Unfair Competition-Deceptive Practices statute, C.R.S. § 10-3-1101 et seq. The Company removed the action to state court on diversity grounds and subsequently moved for summary judgment on grounds the Policy was governed by the Employee Retirement Income Security Act, 29 U.S.C. § 1001 et seq. ("ERISA") and that ERISA preempted Plaintiffs' state law claims.


Granting summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Ash Creek Mining Co. v. Lujan, 934 F.2d 240, 242 (10th Cir.1991); Metz v. United States, 933 F.2d 802, 804 (10th Cir.1991), cert. denied, ___ U.S. ___, 112 S.Ct. 416, 116 L.Ed.2d 436 (1991); Continental Casualty Co. v. P.D.C., Inc., 931 F.2d 1429, 1430 (10th Cir.1991). A genuine issue of material fact exists only where "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Merrick v. Northern Natural Gas Co., 911 F.2d 426, 429 (10th Cir.1990). Only disputes over facts that might affect the outcome of the case will properly preclude the entry of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Allen v. Dayco Prods., Inc., 758 F.Supp. 630, 631 (D.Colo.1990).

In reviewing a motion for summary judgment, the court must view the evidence in the light most favorable to the party opposing the motion. Newport Steel Corp. v. Thompson, 757 F.Supp. 1152, 1155 (D.Colo.1990). All doubts must be resolved in favor of the existence of triable issues of fact. Boren v. Southwestern Bell Tel. Co., 933 F.2d 891, 892 (10th Cir.1991); Mountain Fuel Supply v. Reliance Ins. Co., 933 F.2d 882, 889 (10th Cir.1991).

In a motion for summary judgment, the moving party's initial burden is slight. In Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265 (1986), the Supreme Court held that the language of rule 56(c) does not require the moving party to show an absence of issues of material fact in order to be awarded summary judgment. Rule 56 does not require the movant to negate the opponent's claim. Id. at 323, 106 S.Ct. at 2552. The moving party must allege an absence of evidence to support the opposing party's case and identify supporting portions of the record. Id.

Once the movant has made an initial showing, the burden of going forward shifts to the opposing party. The nonmovant must establish that there are issues of material fact to be determined. Id. at 322-23, 106 S.Ct. at 2552-53. The nonmovant must go beyond the pleadings and designate specific facts showing genuine issues for trial on every element challenged by the motion. Tillett v. Lujan, 931 F.2d 636, 639 (10th Cir.1991). Conclusory allegations will not establish issues of fact sufficient to defeat summary judgment. McVay v. Western Plains Serv. Corp., 823 F.2d 1395, 1398 (10th Cir.1987).

In reviewing the evidence submitted, the court should grant summary judgment only when there is clearly no issue of material fact remaining. In Anderson, 477 U.S. at 249-50, 106 S.Ct. at 2510-11, the Court held that summary judgment should be granted if the pretrial evidence is merely colorable or is not significantly probative. In Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986), the Court held that summary judgment is appropriate when the trial judge can conclude that no reasonable trier of fact could find for the nonmovant on the basis of evidence presented in the motion and the response. Id. at 587, 106 S.Ct. at 1356.


An "employee welfare benefit plan" subject to ERISA must include the following elements ("the statutory criteria") relevant to this action: it is (1) any plan, fund, or program (2) established or maintained (3) by an employer (4) for the purpose of providing benefits (5) to participants or their beneficiaries. 29 U.S.C. § 1002(1); Peckham v. Gem State Mutual of Utah, 964 F.2d 1043, 1047 (10th Cir.1992); Ed Miniat, Inc. v. Globe Life Insurance Group, Inc., 805 F.2d 732, 738 (7th Cir.), cert. denied, 482 U.S. 915, 107 S.Ct. 3188, 96 L.Ed.2d 676 (1987); Donovan v. Dillingham, 688 F.2d 1367, 1371 (11th Cir.1982). The burden is on the party asserting ERISA preemption, here, the Company, to establish the existence of a plan which would invoke ERISA's exclusive remedy provisions. Terry v. Protective Life Insurance Co., 717 F.Supp. 1203, 1205 (S.D.Miss.1989); Peters v. Boulder Insurance Agency, Inc., 829 P.2d 429, 432 (Colo. App.1991), cert. denied (April 20, 1992). Plaintiffs dispute the Company's assertion that their Policy fulfills all the elements of an ERISA plan.

A. The "Plan, Fund, or Program" Requirement

A "plan, fund or program" ("a plan") under ERISA is established if "`from the surrounding circumstances a reasonable person can ascertain the intended benefits, the class of beneficiaries, the source of financing, and the procedure for receiving benefits.'" Peckham, 964 F.2d at 1047 (quoting Donovan, 688 F.2d at 1373). A plan also implicates the existence of benefits "whose provision by nature requires an ongoing administrative program to meet the employer's obligation." Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 11, 107 S.Ct. 2211, 2217, 96 L.Ed.2d 1 (1987).

Because any simple insurance policy must logically include the statutory criteria, most determinations of the existence of a plan hinge on whether the plan requires the employer either to institute an ongoing administrative program that might be subject to conflicting (and therefore preempted) state regulations, or to administer funds that might be subject to abuse or misappropriation. See, e.g., Peckham, 964 F.2d 1043, 1048 (holding administrative program shown by employer's keeping records, making regular payments, and employing two liaisons between insurer and employees); Hansen v. Continental Insurance Co., 940 F.2d 971, 974 (5th Cir.1991) (holding administrative program shown where employer endorsed plan in company booklet referring to it as "our plan," employed full-time plan administrator, collected payments from employees, and remitted payments to insurer); cf. Coyne, 482 U.S. at 11, 107 S.Ct. at 2217 (holding no ongoing administrative program established by employer's single lump-sum payment); Taggart Corp. v. Life & Health Benefits Admin., 617 F.2d 1208, 1211 (5th Cir.1980) (noting corporation did no more than make payments to a purveyor of insurance); Peters, 829 P.2d at 432 (same).

Plaintiffs argue that no "plan" exists in this case because RJR has established no group life insurance policy for its employees —the Policy was an individual life insurance policy covering only Joseph Curtiss; RJR has never represented such a plan to its owners or employees; RJR has never designated an administrator or fiduciary to oversee a group...

To continue reading

Request your trial
7 cases
  • Sanders v. Gravel Products, Inc., 20080001.
    • United States
    • United States State Supreme Court of North Dakota
    • September 2, 2008
    ...plan was not "established or maintained." Gravel Products relied in the district court and this Court on Curtiss v. Union Cent. Life Ins. Co., 823 F.Supp. 851, 855 (D.Ct. Colo.1993), in which the court noted "[t]he employer's degree of participation in the establishment or maintenance of th......
  • Fafara v. American States Life Ins. Co., Civil No. 97-1016-FR.
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Oregon)
    • October 7, 1997
    ...employees. Peterson differs, however, because the health insurance policy provided benefits to the owner. In Curtiss v. Union Central Life Ins. Co., 823 F.Supp. 851 (D.Colo.1993), the life insurance policy had two equal and primary beneficiaries, the employer and the wife of the decedent. T......
  • O'Brien v. Mutual of Omaha Ins. Co., CIV. A. 99-2151.
    • United States
    • United States District Courts. 5th Circuit. United States District Court (Eastern District of Louisiana)
    • December 7, 1999
    ...purchased by sole proprietor for herself and her spouse did not constitute "employee welfare benefit plan"; Curtiss v. Union Central Life Ins. Co., 823 F.Supp. 851 (D.Colo.1993)(citing Taggart Corp. v. Life & Health Benefits Admin., 617 F.2d 1208 (5th Cir.1980)); Kidder v. H & B Marine, Inc......
  • Cox v. The Lincoln Nat'l Life Ins. Co.
    • United States
    • United States District Courts. 10th Circuit. United States District Court of Colorado
    • December 9, 2010
    ...29 U.S.C. § 1002(1); Peckham v. Gen State Mut. of Utah, 964 F.2d 1043, 1047 (10th Cir. 1992); Curtiss v. Union Cent. Life Ins. Co., 823 F. Supp. 851, 854 (D. Colo. 1993). In the instant case, Defendant asserts ERISA preemption, therefore, Defendant bears the burden "to establish the existen......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT