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Sloan v. Country Preferred Insurance Co.

United States District Court, D. Nevada

May 15, 2014

LUCIA SLOAN, Plaintiff,


ANDREW P. GORDON, District Judge.


The parties are well aware of the factual and procedural background of this case, and the Court's holding does not depend on a detailed analysis of which facts are in genuine dispute. A relatively brief summary of the case is therefore sufficient.

On April 5, 2011, plaintiff Lucia Sloan was in a car accident with third-party Jesús Martínez-Ramírez.[1] Sloan alleges various shoulder and spinal injuries as a result. Shortly after the accident, Martínez-Ramírez's insurer paid its policy limit of $15, 000 and defendant Country Preferred Insurance Company ("Country"), Sloan's insurer, paid $25, 000 for medical expenses.

On January 10 and 12, 2012, Country's claims adjuster Roseanna Foy exchanged several e-mails with Country's in-house claims attorney Pete Bangay.[2] Bangay indicated his belief that Sloan's claim "will likely end up in litigation, " and he stated his desire to retain defense counsel Rebecca L. Mastrangelo as soon as possible to help select a medical expert with whom she would be comfortable working.[3]

On January 17, 2012, Sloan demanded $250, 000 in underinsured motorist ("UIM") benefits from Country.[4] Following the Subject Accident, she had obtained medical treatment in the form of MRIs, x-rays, steroid injections, shoulder surgery, and EMG/nerve conduction studies. One of her doctors recommended a more invasive procedure - either a plasma disc decompression or a "fusion."[5] Sloan attached some of the related medical records to her demand letter. In the letter, she listed past special damages of $114, 000, a past wage loss of $13, 000 and an estimated cost for future spinal surgery of $78, 000.[6]

On February 1, 2012, Country retained Dr. Derek Duke as its medical expert.[7] Country attached the January 10 and 12 e-mails between Foy and Bangay to the engagement letter sent to Dr. Duke. Country forwarded to Dr. Duke Sloan's medical records and bills, and informed him of her past medical history. Notably, Sloan was in a car accident in 2008 (the "Prior Accident").[8] She was treated for spinal injuries, and Country paid the UIM policy limit for the Prior Accident. Apparently in reference to the Prior Accident and possibly some other accident(s), Foy stated in the engagement letter to Dr. Duke: "[w]e question the fact that [Sloan] is not injured when she is at fault for a loss, even though cervical injuries are most common in rear-enders." Country asked Sloan to provide his expert opinion as to whether and to what extent the Subject Accident caused Sloan's claimed injuries.

On February 8, 2012, Foy allegedly prepared an "Injury Settlement Worksheet" (the "Worksheet"), which indicated that Country intended to deny Sloan's UIM claim. Sloan contends Country's preparation of the Worksheet before receipt of Dr. Duke's report indicates Country's bad faith in predetermining Sloan's claim.

On February 20, 2012, Dr. Duke sent his report to Country.[9] The report implies that Dr. Duke physically examined Sloan, although he only reviewed her medical records.

On March 2, 2012, Country offered $105, 000 to settle Sloan's claim.[10] Country based this figure on Dr. Duke's report, its review of Sloan's medical records, its knowledge of Sloan's accident history, and the alleged lack of change in Sloan's spine (as seen by comparing MRIs following the Prior Accident and the Subject Accident). Country offset $40, 000 for the payments previously made to Sloan, meaning that the actual net offer was $65, 000.

On March 8, 2012, Sloan demanded a "breakdown" of the $65, 000 offer and expressed "great concerns" about Country's reliance on Dr. Duke's report, primarily because he incorrectly implied that he had physically examined Sloan.[11] Country refused to provide any further detail about the bases of the $65, 000 figure.[12]

On May 9, 2012, Dr. Hyun Bae performed cervical disk replacement surgery on Sloan.[13] In the weeks prior, Sloan had communicated her intent to obtain this surgery, and provided Country with written authorization to obtain her medical records from Dr. Bae.

On May 14, 2012, Sloan's renewed demand for the $250, 000 UIM policy limit "expired." Three days later she filed suit in Nevada state court, pleading three claims for relief: (1) breach of contract; (2) tortious breach of the covenant of good faith and fair dealing ("bad faith"); and (3) unfair claims practices in violation of NRS § 686A.310(1)(f) and (n).

On June 25, 2012, Country removed the case. On October 29, 2012 - the initial expert disclosure deadline - Sloan produced records of her April 12, 2012 examination with Dr. Bae at which he recommended spinal surgery.[14] Dr. Bae stated: "[i]t is certainly not traumatic, but I do think that it is irritating the C7 root and often causing the continued pain, and an injury to the C7 root."[15] It is unclear, however, if "not traumatic" refers to all of Sloan's spinal injuries or to only the injury described in the preceding sentence: "foraminal stenosis."[16]

During the end of 2012 and the beginning of 2013, Bangay, Sloan, Dr. Duke, Dr. Bae, James P.C. Silvestri (Country's insurance claims expert), and Boyd Veenstra (Sloan's insurance claims expert) were deposed. As explained below, the Court disregards all of these depositions because none was properly authenticated.

On March 21, 2013, Sloan received copies of Dr. Duke's "job materials, " excluding privileged materials.[17] The next day, Sloan filed an amended notice of her intent to introduce those "job materials" into evidence at trial.

On April 2, 2013, Country tendered the $250, 000 UIM policy limit to Sloan. In its moving papers, Country contends it made this decision because of Dr. Bae's deposition testimony as to causation. That testimony was the first time, Country argues, that Dr. Bae linked the Subject Accident to the surgery he performed. On the other hand, Sloan argues that Country's change of tune stemmed from its realization that evidence of its "bad faith" claims handling behavior would come out at trial.

Country has moved for summary judgment on all three of Sloan's claims, and Sloan has moved for summary judgment on only the statutory unfair practices claim.[18] For the reasons set forth below, the ...

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