Thompson v. Banner Life Ins. Co.

1

ROBERT THOMPSON, individually and on behalf of similarly situated individuals, Plaintiff, v. BANNER LIFE INSURANCE COMPANY, Defendant.

No. 24-CV-01096-SPM

United States District Court, S.D. Illinois

August 5, 2024

MEMORANDUM AND ORDER

STEPHEN P. McGLYNN, U.S. District Judge.

This matter comes before the Court for consideration of a Motion to Dismiss for Failure to State a Claim (Doc. 19) filed by Defendant Banner Life Insurance Company (“Banner”). Having been fully informed of the issues presented, this Court GRANTS Banner Life Insurance's Motion to Dismiss.

Relevant Factual And Procedural Background

Plaintiff Robert Thompson filed the instant suit in the Circuit Court for the Fourth Judicial Circuit in Effingham County, Illinois on October 30, 2023. See Thompson v. Banner Life Ins Co., No. 023LA32 (Ill. Cir. Ct.). Thompson brought this action as a putative Class Action Complaint on behalf of himself and other similarly situated individuals who applied for life insurance coverage within the applicable limitations period. (See Doc. 1, Ex. B). Thompson alleges that when applying for life insurance with Defendant Banner, he was required to “answer questions concerning his family medical history, i.e. the manifestation of diseases or disorders in his family members. Such questions included whether Plaintiff's family members had a history of high blood pressure, cancer, diabetes, heart disease, and other medical conditions.” (See Doc. 1, Ex. B, ¶ 28). Thompson argues that this information is considered “genetic information” under the auspices of the Illinois Genetic Information Privacy Act, 10 ILL. COMP. STAT. 513/1 et seq. (“GIPA”) such that he is entitled to recovery of statutory damages. (See id., ¶¶ 29-32).

Banner removed this case to federal court pursuant to 28 U.S.C. § 1446 on April 12, 2024. (See Doc. 1). Banner first filed a Motion to Dismiss for Failure to State a Claim on May 31, 2024. (Doc. 13). Plaintiff Thompson filed an Amended Complaint (Doc. 16) in accordance with Federal Rule of Civil Procedure 15(a)(1) on June 13, 2024. (See Doc. 17). Banner filed the instant Motion on June 27, 2024. (See Docs. 19, 20). Plaintiff Thompson filed a Memorandum in Opposition on July 11, 2024 (Doc. 21) to which Banner replied (Doc. 22).

Applicable Law And Legal Standards

In analyzing a motion to dismiss for failure to state a claim filed pursuant to Federal Rule of Civil Procedure 12(b)(6), this Court must determine whether or not the complaint contains “sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The Court of Appeals for the Seventh Circuit has explained that “‘[p]lausibility' is not a synonym for ‘probability' in this context, but it asks for ‘more than a sheer possibility that a defendant has acted unlawfully.'” Bible v. United Student Aid Funds, Inc., 799 F.3d 633, 639 (7th Cir. 2015) (quoting Olson v. Champaign County, 784 F.3d 1093, 1099 (7th Cir. 2015)). “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations . . . [the] [f]actual allegations must be enough to raise a right to relief above the speculative level ....” Twombly, 550 U.S. at 555.

District courts are required by the Court of Appeals for the Seventh Circuit to review the facts and arguments in Rule 12(b)(6) motions “in the light most favorable to the plaintiff, accepting as true all well-pleaded facts alleged and drawing all possible inferences in her favor.” Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008). “The purpose of a motion to dismiss is to test the sufficiency of the complaint, not to decide the merits.” Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir. 1990).

Because the instant suit was filed in Illinois and both parties have applied Illinois law, the Court applies the same. See Ryerson Inc. v. Fed. Ins. Co., 676 F.3d 610, 611-12 (7th Cir. 2012).

Analysis

GIPA was passed in 1998 as a means to serve the public interest via limitations on how information gleaned from genetic testing could be used because such information “can be valuable to an individual.” GIPA § 5 (1998). Thompson brings this action purportedly pursuant to § 20(b) of GIPA, which states that “[a]n insurer shall not use or disclose protected health information that is genetic information for underwriting purposes.” Thompson argues that “Plaintiff and the Class underwent medical physical exams performed by healthcare providers during which questions regarding their family medical history, i.e. the manifestation of a disease or disorder in family members were asked” and that “the third-party healthcare providers collected Plaintiff's and the other Class members' protected health information that is genetic information.” (Doc. 16, ¶¶ 53-54). Thompson alleges that “Defendant then obtained and used this information for underwriting purposes by, inter alia, using it to assess Plaintiff's and the Class members' eligibility for life insurance coverage and compute their premiums” and, therefore, that “Defendant used Plaintiff's and the Class members' genetic information in violation of the GIPA.” (Id., ¶¶ 55-56). Thompson argues that because “[t]he information obtained from Plaintiff and the Class by Defendant is the type of information protected by GIPA[,] . . . Plaintiff and the other Class members have been aggrieved by Defendant's above violations of their statutorily protected rights to privacy in their genetic information as set forth in GIPA.” (Id., ¶¶ 58-59 (citing GIPA § 10)). He argues that these violations entitle him and the putative class members to “statutory damages of $15,000 for each reckless or intentional violation of GIPA and, alternatively, damages of $2,500 for each negligent violation of GIPA.” (Id., ¶ 60 (citing GIPA § 40(a)(1)-(2)).

In its Memorandum of Law in Support of the Motion to Dismiss (Doc. 20), Banner argues that Thompson has misread and misapplied GIPA because life insurance was not included within the definition of “insurers.” (See id., pp. 7-19). Banner argues that “[t]his is a straightforward statutory interpretation case” because Thompson “would have this Court apply Section 20(b) of [GIPA] to life insurance companies despite the plain language of the statute-clearly making known that it does not apply to life insurers.” (Id., p. 7). Banner argues that “this Court must predict how the Illinois Supreme Court would apply the statute.” (Id., p. 11 (citing Pisciotta v. Old Nat'l Bancorp, 499 F.3d 629, 635 (7th Cir. 2007))). Banner states that “[t]he Illinois Supreme Court has held, as a fundamental canon of statutory construction, that “[t]he primary goal in interpreting a statute is to ascertain and give effect to the intent of the legislature.” (Id. (quoting People v. Stewart, 215 N.E.2d 752, 756 (Ill. 2022))). Banner argues that the language “other activities related to the creation, renewal, or replacement of a contract of health insurance or health benefits” indicates that the Illinois Legislature intended to limit GIPA to health insurers only. (Id., p. 12 (quoting GIPA § 20(b)(4))). Banner also cites Seventh Circuit and Supreme Court caselaw indicating that a subsequent part of a statute can refer back to an earlier provision. (Id., p. 13 (citing Sw. Airlines Co. v. Saxon, 596 U.S. 450, 459 (2022); Kleber v. CareFusion Corp., 914 F.3d 480, 482 (7th Cir. 2019))). Banner also argues that “the definition of ‘protected health information' limits Section 20(b)'s regulatory scope to insurers who use information for underwriting purposes that was ‘created or received by a health care provider, health plan, employer, or health care clearinghouse.'” (Id., p. 13 (citing GIPA § 10; 45 C.F.R. § 160.103)).

Besides the text of the statute itself, Banner also looks to GIPA's legislative history. (See id., p. 15). Stating that “[t]he Illinois statute in question has been in force for many years,” Banner argues that “[i]n 1997, when GIPA was proposed, GIPA's sponsors in the Illinois Senate and Illinois House of Representatives stated unequivocally that life insurance was excluded from GIPA's regulatory scope.” (Id. (citing S. Tr. 90-26, Reg. Sess., at 44 (Ill. 1997); S. Tr. 90-27, Reg. Sess., at 142 (Ill. 1997); H.R. Tr. 90-43, Reg. Sess., at 184, 188-89, 190-91 (Ill. 1997))). Banner states that “Public Health Act 98-1046 amended GIPA to add the General Assembly's express finding that ‘[l]imiting the use or disclosure of, and requests for, protected health information to the minimum necessary to accomplish an intended purpose, when being transmitted by or on behalf of a covered entity under HIPAA, is a key component of health information privacy.'” (Id., pp. 15-16 (quoting 2014 Ill. Legis. Serv. P.A. 98-1046 (H.B. 5925) (emphasis added))). Banner argues that this means that Section 20(b) was not meant to apply to life insurers. (See id., p. 16). Because “legislatures do not ‘hide elephants in mouseholes,'” Banner argues that “there is only one plausible conclusion: Section 20(b) was intended to protect the disclosure of information protected under HIPAA in connection with the underwriting of health insurance policies and health benefit[s]. Section 20(b) was not intended to regulate the underwriting of life insurance policies.” (Id., p. 17 (quoting People ex rel. Ryan v. Agpro, Inc., 824 N.E.2d 270, 274 (Ill. 2005))).

Finally Banner argues that “[a]ccording to Plaintiff's construction of Section 20(b), in 2015, the Illinois General Assembly prohibited life insurers from conducting medical examinations or considering family medical history when issuing life insurance policies.” (Id., p. 18). “For over 125...