Wilson v. Geico Indem. Co.

ANNA WILSON, Plaintiff, v. GEICO INDEMNITY COMPANY, Defendant.

CASE NO. C18-226 RAJ

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE

August 15, 2018

HONORABLE RICHARD A. JONES

ORDER

This matter comes before the Court on Defendant Geico Indemnity Company's ("Geico") Motion for Summary Judgment. Dkt. # 10. Plaintiff opposes, and Geico has filed a Reply. Dkt. ## 24, 26. Having considered the submissions of the parties, the relevant portions of the record, and the applicable law, the Court finds that oral argument is unnecessary. For the reasons that follow, Geico's Motion for Summary Judgment is DENIED. Dkt. # 10.

I. BACKGROUND

For purposes of this motion, the Court construes the facts in the light most favorable to Plaintiffs, the non-moving party. Plaintiff was involved in a collision on August 11, 2016, in which she was an occupant of a driver insured by Geico. Dkt. # 1-1 at p. 2, ¶ 2.2. Plaintiff then submitted a claim for income continuation and medical benefits to Geico for Personal Injury Protection ("PIP") benefits pursuant to the insured driver's insurance policy. Dkt. # 11-1.

Geico commenced an investigation of Plaintiff's claim. During this investigation, Geico contacted Plaintiff's employer and union and obtained Plaintiff's "HR file," payroll records, and other information. See generally Dkt. ## 11-11, 11-15, 11-16, 25-4, 25-5, 25-6, 25-7, 25-11 to 25-16, 25-19 to 25-24. Plaintiff gave a recorded statement to Geico and provided authorization for Geico to obtain her medical records. Dkt. # 25-1 at p. 11:17-25. Plaintiff also submitted to independent medical examinations on June 27, 2017, November 16, 2017, and November 20, 2017. Dkt. ## 11-10, 11-19, 11-20.

On December 13, 2017, Geico sent a letter to Plaintiff's counsel stating the following:

According to John Wendt, M.D., "On Objective basis, the individual has reached maximum medical improvement. Again the effective date, we would expect it to have been normally one month after the accident." Therefore, we are suspending all medical payments for treatment which your client receives after 05/22/2017

According to Dr. Douglas H. Peffer, "In summary, the claimant is capable of working and the wage loss and /or restrictions would not be result of the accident." Therefore, we are denying the lost wage claim.

Dkt. # 25-30. On December 14, 2017, Plaintiff filed a 20-day notice of potential lawsuit under Washington's Insurance Fair Conduct Act, RCW 48.30.015. Dkt. # 11-3, 11-4.

On December 29, 2017, Geico, now communicating through counsel, argued that Plaintiff's IFCA notice was "defective," and requested an "Examination Under Oath" ("EUO") pursuant to the insurance policy in January 2018. Dkt. # 11-3.Specifically, Defendant's letter stated:

As you are aware, GEICO has not denied your client's claim. Rather, there is a dispute about the amount of Personal Injury Protection benefits for which your client is entitled to recover.

As you are aware, GEICO has determined that your client did not have any wage loss as a result of the above referenced loss. You and your client disagree with GEICO's determination.

As such, GEICO wishes to conduct your client's examination under oath pursuant to the terms and conditions of the policy and Washington State statute.

Id. Geico also requested additional documents from Plaintiff, including (1) "income tax returns, evidence of income for the twelve months prior to the loss, and W-2 forms or other documents substantiating employment for the last two years"; (2) a list of "all costs, expenses and damages which your client is claiming"; and (3) a "listing of each and every employer for the past four years." Id. at 2.

Following several communications, on January 23, 2018, Plaintiff's counsel responded, claiming that Defendant's "material breaches and repudiation of the insurance contract relieve Ms. Wilson, as the non-breaching party, of further performance," and arguing that the commencement of litigation, with the promise of discovery, made Defendant's EUO and information requests moot. Dkt. # 11-8. On February 1, 2018, Defendant responded, claiming that Plaintiff has failed to comply with the policy by not appearing for an EUO, and again claimed that Defendant "has never denied coverage for this case." Dkt. # 11-9.

On January 23, 2018, Plaintiff Anna Wilson filed this action in King County Superior Court against Defendant Geico Indemnity Company. Dkt. # 1. Plaintiff's Complaint alleged that Geico is in breach of contract by failing to pay claims made under the insurance policy. Dkt. # 1-1. Plaintiff's Complaint seeks damages for breach of contract, breach of the duty to act in good faith, as well as claims under the IFCA andWashington's Consumer Protection Act, RCW 19.86.090 ("CPA"). Id. Defendant then filed a Notice of Removal on February 12, 2018. Dkt. # 1. Defendant filed its Answer on February 28, 2018. Dkt. # 6.

Geico now moves for summary judgment on the basis that Plaintiff violated the insurance policy's cooperation clause by not submitting to the EUO and providing requested information. Dkt. # 10. Plaintiff opposes, and Defendants have filed a Reply. Dkt. ## 24, 26.

II. LEGAL STANDARD

Summary judgment is appropriate if there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Where the moving party will have the burden of proof at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). On an issue where the nonmoving party will bear the burden of proof at trial, the moving party can prevail merely by pointing out to the district court that there is an absence of evidence to support the non-moving party's case. Celotex Corp., 477 U.S. at 325. If the moving party meets the initial burden, the opposing party must set forth specific facts showing that there is a genuine issue of fact for trial in order to defeat the motion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The court must view the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that party's favor. Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150-51 (2000).

However, the court need not, and will not, "scour the record in search of a genuine issue of triable fact." Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir. 1996); see also, White v. McDonnel-Douglas Corp., 904 F.2d 456, 458 (8th Cir. 1990) (the court need not"speculate on which portion of the record the nonmoving party relies, nor is it obliged to wade through and search the entire record for some specific facts that might support the nonmoving party's claim"). The opposing party must present significant and probative evidence to support its claim or defense. Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). Uncorroborated allegations and "self-serving testimony" will not create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002); T. W. Elec. Serv. V. Pac Elec. Contractors Ass'n, 809 F. 2d 626, 630 (9th Cir. 1987).

III. DISCUSSION

Geico claims that a provision of the insurance policy requires a claimant to submit to an EUO upon Geico's request:

13. EXAMINATION UNDER OATH

The insured or any other person seeking coverage under this policy must submit to examination under oath by any person named by us when and as often as we may require.

Dkt. # 11-2, at p. 17, ¶ 13. Geico also points to other provisions of the insurance policy that claim that "no action will lie against [GEICO] unless there has been full compliance with all the terms of the coverage." Dkt. # 11-2, at p. 21, ¶ 3. Geico contends that Plaintiff's violation of these provisions means that her Complaint should be dismissed as a matter of law.

The Court first addresses what appears to be a key factual issue in dispute: whether Geico in fact denied Plaintiff coverage. Geico's counsel argued that Geico "never" denied Plaintiff coverage under the policy, and that Plaintiff's claim "was open when the request for the EUO was made." Dkt. ## 11-9; 26 at 5. Plaintiff counters by pointing to the December 13, 2017 letter from Geico where Geico stated that it was "denying the lost wage claim" and "suspending all medical payments for treatment which your client receives after 05/22/2017." Dkt. ## 25-30. Geico responds by arguing thatthis letter, despite its language, "did not deny coverage," and merely "stated its position that the investigation did not support any further PIP benefits." Dkt. # 26 at 6.

The Court finds Geico's position less than compelling. Despite Geico's repeated insistence that there has been no denial, the clear language of Geico December 13, 2017 letter suggests otherwise. The Court finds it difficult to see how this letter purportedly "denying" coverage and "suspending" payments is not, in fact, a denial.¹ The Court concludes that, at the very least, there exists a genuine issue of material fact as to whether Geico's December 13, 2017 letter constitutes a "denial" of coverage under the insurance policy. At the summary judgment stage, the Court will thus view this evidence in the light most favorable to Plaintiff, the nonmoving party, and construe the December 13, 2017 letter as a denial of coverage.

A. Geico's Affirmative Defense of Noncooperation

Geico moves for summary judgment on its affirmative defense that Plaintiff failed to cooperate under the provisions of the insurance policy, and thus is ineligible for coverage. Dkt. # 10 at 10. Under Washington law, an insured that breaches a cooperation clause may be contractually barred from bringing suit under the policy. Staples v. Allstate Ins. Co., 176...