Phillips v. Clark Cnty. Sch. Dist.

• Decision Date: 30 September 2012
• Docket Number: Case No. 2:10–cv–02068–GMN–GWF.
• Citation: 903 F.Supp.2d 1094
• Parties: LaQuan PHILLIPS, Plaintiff, v. CLARK COUNTY SCHOOL DISTRICT; National Union Fire Insurance Company of Pittsburg, PA; Doe Employees 1 through 20; Does 1 through 20; Roe Entities 1 through 20; and Roe Corporations 1 through 20, Defendants.
• Court: U.S. District Court — District of Nevada

903 F.Supp.2d 1094

LaQuan PHILLIPS, Plaintiff,

v.CLARK COUNTY SCHOOL DISTRICT; National Union Fire Insurance Company of Pittsburg, PA; Doe Employees 1 through 20; Does 1 through 20; Roe Entities 1 through 20; and Roe Corporations 1 through 20, Defendants.

Case No. 2:10–cv–02068–GMN–GWF.

United States District Court, D. Nevada.

Sept. 30, 2012.

Robert M. Adams, Bradley J. Myers, Mainor Eglet Cottle, Danielle A. Tarmu, Robert T. Eglet, Eglet Wall, Las Vegas, NV, for Plaintiff.

David Mincin, Law Office of Richard McKnight, Las Vegas, NV, Marc J. Derewetzky, Trenk, Dipasquale, Webster, Della Fera & Sodono PC, Oakland, CA, for Defendants.

ORDER

GLORIA M. NAVARRO, District Judge.

Pending before the Court is the Motion for Partial Summary Judgment Regarding Breach of Contract (ECF No. 27), filed by Plaintiff LaQuan Phillips (“Plaintiff”). Defendant National Union Fire Insurance Company (“Defendant”) filed a Response (ECF No. 33) and Plaintiff filed a Reply (ECF No. 35). For the reasons discussed below, Plaintiff's Motion is DENIED.

Also pending before the Court is the Cross Motion for Summary Judgment (ECF No. 34) filed by Defendant. Plaintiff filed a Response (ECF No. 42) and Defendant filed a Reply (ECF No. 57). For the reasons discussed below, Defendant's Motion is GRANTED in part and DENIED in part.

I. BACKGROUND

This case arises from a tragic injury suffered by Plaintiff, LaQuan Phillips (“Plaintiff”), during a high school football game on September 5, 2008. (Mot. for Partial Summ. J. 3:13–15, ECF No. 27.) Pursuant to an insurance policy purchased by Clark County School District, National Union Fire Insurance Company (“Defendant”) paid for Plaintiff's medical bills above the deductible stated in that insurance policy.¹ ( Id. at 3:20–23.) However, Defendant refused to pay the $500,000.00 catastrophe cash benefit (“Cash Benefit”) under the subject insurance policy. ( Id. at 2:28–3:2.) Thus, Plaintiff filed this suit seeking payment of this Cash Benefit. ( Id. at 3:4–9.)

A. Plaintiff's Injury

In 2008, Plaintiff was the captain of the Green Valley High School football team. (Compl. ¶ 11, ECF No. 1–2.) On September 5, 2008, Plaintiff was participating in a football game against Centennial High School when he was hit by another player. ( Id.) As a result of injuries sustained from this hit, Plaintiff was “diagnosed as a C4 quadriplegic and immediately underwent a C3–4 anterior cervical discectomy and C3–C7 laminectomies for decompression.” (Mot. for Partial Summ. J. 3:17–19, ECF No. 27.)

B. The Insurance Policy

In April 2008, just prior to the Plaintiff's September 5, 2008 injury, the Clark County School District purchased an insurance policy for the benefit of the school district's student athletes. (Pl.'s Mot. Partial Summ. J. 4:5–6, ECF No. 27.) Notably, this insurance policy included a Catastrophe Cash Benefit Rider (the “Rider”) that would provide a cash payment for those students who suffered sufficiently devastating injuries during interscholastic activities. ( Id. at 2:23–26.) This provision provided that:

Catastrophe Cash Benefit. If Injury to the Insured results, within 180 days of the date of the accident that caused the Injury, in Paralysis or Coma, the Company will pay a benefit under the conditions described in this Rider. In order for a benefit to be payable under this Rider, the Paralysis or Coma must continue for a Waiting Period of 6 consecutive months, must be determined by a Physician to be permanent and irreversible at the end of that Waiting Period, and must result in Disability.

( Id. at Ex. 2, ECF No. 27 (emphasis added).) Thus, the Rider requires “Paralysis” and “Disability” before a student is entitled to the $500,000.00 cash benefit. ( Id.) To that end, the Rider also defines “Paralysis” as “the complete loss of function in a part of the body as a result of neurological damage, as determined by a Physician.” ( Id.) Additionally, under the Rider, a student is “Disabled” when that student “is unable while under the regular care of a Physician, to engage in any of the usual activities of a person of like age and sex whose health is comparable to that of the [student] immediately prior to the accident.” ( Id.) Finally, the determination that the student is paralyzed must come from a Physician, as defined by the Rider. ( Id.) The Rider defines “Physician” as a “licensed practitioner of the healing arts acting within the scope of his or her license who is not 1) the Insured; 2) an Immediate Family Member; or 3) retained by the Policyholder.” ( Id.)

C. Defendant's Denial of the Catastrophe Cash Benefit

Since Plaintiff's injury, he received regular treatment from Robert Voy, M.D. (“Dr. Voy”), who practices in general medicine and sports medicine. ( Id. at 5:17–20.) As such, more than eight months after Plaintiff's injury, Defendant wrote to Dr. Voy requesting “additional medical records,” to be used in evaluating whether Plaintiff qualified for the cash benefit. ( Id. at Ex. 5, ECF No. 27.) Defendant specifically informed Dr. Voy that awarding the cash benefit under the Rider required that “[a] physician must determine if the paralysis is complete, permanent and irreversible.” ( Id. (alteration in original).) Dr. Voy responded that, in his medical opinion, Plaintiff was paralyzed and that paralysis was complete, permanent, and irreversible. ( Id. at Ex. 6, ECF No. 27.) Specifically, on May 28, 2009, Dr. Voy informed Defendant that, although Plaintiff made improvements throughout his treatment, Plaintiff was “presently a quadriplegic from the neck down including total paralysis of both upper and lower extremities.” ( Id.) Dr. Voy also informed Defendant that Plaintiff still faced substantial limitations and disabilities with his hands, arms, legs, and organs. ( Id. at 6:22–24 (quoting Ex. 6, Letter of Dr. Voy.) Moreover, Dr. Voy opined that Plaintiff's “upper extremity status [was] permanent and irreversible,” and that “with a reasonable degree of medical certainty, after nine months of continued therapy, [Plaintiff's] disability is permanent.” ( Id. at 6:25–27 (quoting Ex. 6, Letter of Dr. Voy).)

After Defendant received Dr. Voy's response, Defendant arranged to have these records reviewed by its own retained expert, Leonid L. Topper, M.D. (“Dr. Topper”). (Def.'s Resp. to Pl.'s Mot. Partial Summ. J. 6:5–6, ECF No. 33.) Thereafter, Dr. Topper spent .7 hours, or 42 minutes, reviewing Plaintiff's medical records. ( See Pl.'s Resp. to Def.'s Mot. Summ. J., Ex. 13, ECF No. 42–13.) On June 19, 2009, Dr. Topper concluded that Plaintiff did not qualify for the Cash Benefit. (Def.'s Resp. to Pl.'s Mot. Partial Summ. J. Ex. 2 at 55–58, ECF No. 33–2.) Thus, despite Dr. Voy's letter stating to the contrary, Defendant sent a letter to Plaintiff's legal guardian stating that “no benefits [were] payable at th[at] time.” (Mot. Partial Summ. J. Ex. 7, ECF No. 27.) Specifically, Plaintiff was denied payment of the Cash Benefit via a letter dated June 23, 2009 because his injuries failed to meet the Defendant's definitions of “disability and paralysis.” ( Id.)

D. Plaintiff's Current State of Health

Plaintiff began making progress before he was discharged from the hospital. First, in November 2008—two months afterthe injury, doctors noted that Plaintiff “managed a few steps with one person with moderate assist.” (Def.'s Resp. Mot. Summ. J. Ex. 1, at 2, ECF No. 33–1.) At the same time, however, doctors noted that Plaintiff was “lacking trunk and pelvic control in muscle activity.” ( Id.) Additionally, the doctors observed that Plaintiff still suffered from “neurogenic bowel and bladder,” thus, requiring “4–6 hour catheterizations” and “bowel care ... every other day.” ( Id.) Later, on January 14, 2009—four months after the injury, Plaintiff's physical therapist reported that Plaintiff was ambulatory with a “quad cane.” ( Id. at Ex. 3, ECF No. 33–1.) On April 6, 2009—seven months after the injury, Plaintiff's physical therapist recognized that Plaintiff's “safety is compromised and he occasionally has a fall or loss of balance,” when Plaintiff attempts to walk, even when walking with a quad cane. ( Id. at Ex. 12, ECF No. 33–2.) Furthermore, the physical therapist observed that “[b]ecause of deficits in his hand function ..., [Plaintiff] has difficulty dressing himself, and bathing safely.” ( Id.)

Even as late as May 26, 2009, over nine months after Plaintiff's injury, Dr. Voy noted that the hardening of the muscles and tendons in Plaintiff's upper extremities had not improved and was, thus, “permanent and irreversible.” (Pl.'s Mot. Partial Summ. J. Ex. 6, at 1, ECF No. 27.) Dr. Voy also noted that Plaintiff could hold objects only when fixed in his hand. ( Id. at 2.) Furthermore, at this point, Plaintiff was still unable to dress himself. ( Id.) Additionally, Plaintiff's “[b]owel movements need[ed] regular stimulation” and Plaintiff's “[b]ladder function [was] slow and he also [had] incontinence at times.” ( Id.) Dr. Voy concluded that Plaintiff would “need lifetime therapy to prevent any further contractures and more permanent disability.” ( Id.)

More recently, on August 31, 2011—almost two years after the injury, Defendant again retained an expert, Stuart S. Kaplan, M.D. (“Dr. Kaplan”) that determined that Plaintiff “is left with a very significant spastic quadriplegia.” (Def.'s Resp. to Pl.'s Mot. Partial Summ. J. Ex. 1, at 57, ECF No. 33–1.) Dr. Kaplan further opined that, although Plaintiff is not paralyzed within the meaning of the Rider, “he has been left with a significant disability.” ( Id.)

II. APPLICABLE SUBSTANTIVE LAWA. Summary Judgment Standard—Federal Law

Although a federal district court sitting in diversity is bound to apply state substantive law, that court will still apply federal procedural law. See Erie R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Although the “[c]lassification of a law as ‘substantive’ or ‘procedural’ for Erie purposes is sometimes a...