Waters v. AIG Claims, Inc.

• Decision Date: 22 June 2022
• Docket Number: CASE NO.: 2:17-cv-133-RAH
• Citation: 608 F.Supp.3d 1120
• Parties: Lorrie WATERS and Derrel Keith Waters, Plaintiffs, v. AIG CLAIMS, INC. and National Union Fire Insurance Company of Pittsburgh, PA, Defendants.
• Court: U.S. District Court — Middle District of Alabama

608 F.Supp.3d 1120

Lorrie WATERS and Derrel Keith Waters, Plaintiffs,

v.AIG CLAIMS, INC. and National Union Fire Insurance Company of Pittsburgh, PA, Defendants.

CASE NO.: 2:17-cv-133-RAH

United States District Court, M.D. Alabama, Northern Division.

Signed June 22, 2022

Thomas O'Neal Sinclair, Lee P. Fernon, Jr., Sinclair Law Firm, LLC, Birmingham, AL, for Plaintiffs.

Grace Robinson Murphy, Braxton Scott Thrash, William Bernhart Wahlheim, Jr., Maynard, Cooper & Gale, P.C., Birmingham, AL, for Defendants.

MEMORANDUM OPINION AND ORDER

R. AUSTIN HUFFAKER, JR., UNITED STATES DISTRICT JUDGE

This ERISA action was brought by Plaintiffs Lorrie and Keith Waters after they were denied benefits under an employer-provided life insurance policy that insured the life of their son, Cody Waters, who died in a single vehicle motor vehicle accident in Louisiana on August 15, 2015. Pertinent to the instant case is the insurance policy's coverage exclusion for intoxication-related deaths.

Pending before the Court is a raft of motions, including competing dispositive motions (Docs. 171, 172), competing motions to exclude the opinions of the other party's respective toxicologist experts (Docs. 169, 170, 174), and a spoliation motion (Doc. 163) filed by the Waterses following the Defendants’ alleged destruction of a fluid sample collected during Cody's autopsy.

I. LEGAL STANDARD

The Waterses have filed a Motion for Summary Judgment, and Defendants AIG Claims, Inc. and National Union Fire Insurance Company of Pittsburg, PA (collectively, AIG) have filed a Motion for Judgment as a Matter of Law. Based on the parties’ stipulation to the Court's resolution of this case "on the papers," the Court will make a final ruling on the briefs and evidentiary submissions with findings of fact and conclusions of law. This practice has been found to be the preferable one in ERISA cases by other district courts and has been approved by the Eleventh Circuit. See Faison v. Donalsonville Hosp., Inc. , 534 F. App'x 924, 925 (11th Cir. 2013) (affirming a district court's conclusions from an ERISA "trial on the papers").

In an ERISA benefits denial case, "the district court sits more as an appellate tribunal than as a trial court. It does not take evidence, but, rather, evaluates the reasonableness of an administrative determination in light of the record compiled before the plan fiduciary." Curran v. Kemper Nat'l Servs., Inc. , No. 04-14097, 2005 WL 894840, at * 7 (11th Cir. Mar. 16, 2005) (per curiam) (quotation marks and citation omitted). The summary judgment standard in ERISA cases is therefore different from the ordinary summary judgment standard that applies in other cases. See Ruple v. Hartford Life & Accident Ins. Co. , 340 F. App'x 604, 610 (11th Cir. 2009) (per curiam). "[T]he usual tests of summary judgment, such as whether a genuine dispute of material fact exists, do not apply." Jones v. Fed. Express Corp. , 984 F.Supp.2d 1271, 1275 (M.D. Fla. 2013) (alteration added) (quotation marks and citation omitted). "Thus, there may indeed be unresolved factual issues evident in the administrative record, but unless the administrator's decision was wrong, or arbitrary and capricious, these issues will not preclude summary judgment as they normally would." Miller v. PNC Fin. Servs. Grp., Inc. , 278 F. Supp. 3d 1333, 1341 (S.D. Fla. 2017) (quotation marks and citation omitted).

The ERISA statute provides no standard for courts reviewing the benefits decision of claims administrators. Blankenship v. Metro. Life Ins. Co. , 644 F.3d 1350, 1354 (11th Cir. 2011) (citing Firestone Tire & Rubber Co. v. Bruch , 489 U.S. 101, 109, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989) ). However, the Supreme Court in Firestone established three distinct standards for reviewing an ERISA plan administrator's decision: (1) de novo where the plan does not grant the administrator discretion; (2) arbitrary and capricious where the plan grants the administrator discretion; and (3) heightened arbitrary and capricious where the plan grants the administrator discretion, and the administrator has a conflict of interest. See Buckley v. Metropolitan Life , 115 F.3d 936, 939 (11th Cir. 1997). The Eleventh Circuit, applying Supreme Court precedent, expanded the Firestone test into a six-step analysis "for use in judicially reviewing virtually all ERISA-plan benefit denials." Williams v. BellSouth Telecommunications, Inc. , 373 F.3d 1132, 1137 (11th Cir. 2004). The framework is as follows:

(1) Apply the de novo standard to determine whether the claim administrator's benefits-denial decision is "wrong" (i.e., the court disagrees with the administrator's decision); if it is not, then end the inquiry and affirm the decision; (2) If the administrator's decision is "de novo wrong," then determine whether he was vested with discretion in reviewing claims; if not, end the judicial inquiry and reverse the decision;

(3) If the administrator's decision is "de novo wrong" and he was vested with discretion in reviewing claims, then determine whether "reasonable" grounds supported it (hence, review his decision under the more deferential arbitrary and capricious standard);

(4) If no reasonable grounds exist, then end the inquiry and reverse the administrator's decision; if reasonable grounds do exist, then determine if he operated under a conflict of interest;

(5) If there is no conflict, then end the inquiry and affirm the decision;

(6) If there is a conflict, the conflict should merely be a factor for the court to take into account when determining whether an administrator's decision was arbitrary and capricious.

Id. at 1355.

Applying the de novo standard, "[t]he Court must consider, based on the record before the administrator at the time its decision was made, whether the court would reach the same decision as the administrator." Glazer v. Reliance Standard Life Ins. Co. , 524 F.3d 1241, 1246 (11th Cir. 2008). In making this determination, the court does not give any deference to the administrator's decision; rather, the court "stand[s] in the shoes of the administrator and start[s] from scratch, examining all the evidence before the administrator as if the issue had not been decided previously." Bates v. Metro. Life Ins. Co. , No. 5:08-cv-22 (CAR), 2009 WL 2355834, at *10 (M.D. Ga. July 27, 2009) (internal quotations and citation omitted). The claimants bear the burden of proving they are entitled to ERISA benefits. See Glazer , 524 F.3d at 1247.

II. FACTS AND PROCEDURAL HISTORY

A. Accident, Autopsy and Police Department Causation Opinion

Cody Waters died in a single vehicle, roll-over crash around 11:00 p.m. on August 15, 2015, in Shreveport, Louisiana. (Doc. 170-8; Doc. 173-2 at 101-104; Doc. 173-4 at 7–10.) There was one eyewitness to the accident, who saw Cody's vehicle veer to the right, then to the left, then to the right again, and then flip over and roll into the grass. (Doc. 170-8 at 2; Doc. 173-2 at 92.) Cody was ejected from the vehicle and emergency responders declared him dead at the scene. (Doc. 173-2 at 92.)

Cody's body was transported to the LSU Health Sciences Center Department of Pathology in Shreveport for an autopsy. (Doc. 173-2 at 101–04; Doc. 173-4 at 9.)

Dr. Long Jin of Louisiana State University performed the autopsy around 10:30 a.m. on August 16, 2015—less than twelve hours after the accident. (Doc. 173-3 at 29–33.) Dr. Jin drew samples of cardiac blood, vitreous fluid, and urine, but he only sent the cardiac blood and urine off for analysis by a third-party vendor, NMS Labs. (Doc. 173-3 at 29, 33.) Cody's cardiac blood ultimately tested positive for ethanol, showing a blood alcohol concentration (BAC) of 0.113%, an amount in excess of Louisiana's 0.08% legal limit to operate a motor vehicle. (Doc. 173-3 at 34.) The urine sample was negative for drugs. (Doc. 173-3 at 33–35.)

Dr. Jin included these toxicology results in his final autopsy report, and also noted in the report the massive internal and external damage to Cody's chest cavity. (Doc. 173-3 at 29–33.) With the autopsy report in hand, the Shreveport Police Department Traffic Crash Reconstructionist/Crash Investigator closed the case, concluding that Cody's death was "accidental" with the "causal factor of the crash determined to be careless operation of the motor vehicle due to ethanol intoxication (alcohol impairment)." (Doc. 173-4 at 10.)

The State of Louisiana Certification of Death contained a similar conclusion. (Doc. 173-2 at 88.) It identified the cause of death as "crush injuries to the head

" and "multiple blunt force injuries," with "ethanol use" being an "other significant condition[ ] contributing to death but not resulting in the underlying cause given." (Id. )

B. The Policy, Claim, Investigation and Claim Denial

Through his employment with ExpressJet Airlines, Inc. and participation in the ExpressJet Airlines, Inc. Consolidated Welfare Benefit Plan, Cody had elected accidental death and dismemberment (AD&D) protection of $500,000, and named his parents, the Waterses, as beneficiaries. (Doc. 173-2 at 29–77, 87.) The policy was issued to ExpressJet Airlines and underwritten by Defendant National Union Fire Insurance Company to insure the accidental death and dismemberment component of the ExpressJet ERISA plan. (Id. at 29–77.) Claims under the policy were administered by AIG.

Under the policy, 100% of the principal sum would be paid if an injury caused by an accident resulted in death within 365 days of the date of the accident that caused the injury. (Id. at 47.) However, pertinent to the dispute here, the policy contained an exclusion for death "caused in whole or in part by, or resulting in whole or in part from, ... the Insured Person being under the influence of drugs or intoxicants, unless taken under the advice of a Physician." (Id. at 49.) The "under the influence" language of the exclusion did not require any particular threshold, such as a state legal limit, for intoxication.

Following Cody's accident, the...