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Gibbons v. National Union Fire Insurance Co. of Pittsburgh, PA

United States District Court, District of Nevada

May 15, 2015

DENNIS GIBBONS, et al., Plaintiff(s),
v.
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, et al., Defendant(s).

ORDER

Presently before the court is a motion to reconsider filed by plaintiffs Dennis Gibbons and Julie Pelekanos (hereinafter “plaintiffs”). (Doc. # 63). Defendant National Union Fire Insurance Company of Pittsburgh, Pennsylvania (hereinafter “National Union”) filed a response, (doc. # 69), defendant Bank of America (“BofA”) filed a response, (doc. # 70), and plaintiffs filed a reply, (doc. # 71).

I. Background

This action arises from defendants’ marketing and sale of “blanket disability” insurance policies to BofA customers. (Doc. # 45). BofA sent correspondence to customers promoting the policies. BofA also provided National Union with these customers’ personal information, so that National Union could contact customers regarding the policies. (Doc. # 45).

Potential insureds were told that they were being offered the policies because they were BofA customers, and that BofA would pay their premiums for an initial period. (Doc. # 45). After the “free” initial time period, the premiums for the policy would be deducted from the insureds’ bank accounts or charged to the insureds’ credit card accounts. (Doc. # 45).

Through mail marketing and telemarketing, defendants described the instant insurance policies as “blanket disability coverage.” (Doc. # 45). Plaintiff Dennis Gibbons (“Gibbons”) received written materials at his home promising “accident insurance coverage” in the event he became totally disabled due to an accident. (Doc. # 45).

Based on the representations in the written materials, Gibbons enrolled in the coverage plan. (Doc. # 45). Gibbons subsequently received two notices of coverage and two “description of coverage” documents, all describing the terms of his policy. (Doc. # 45).

Similarly, plaintiff Julie Pelekanos (“Pelekanos”) purchased the insurance coverage at issue based on defendants’ representations. (Doc. # 45). Pelekanos spoke with a telemarketer who explained that the policy would provide benefits if Pelekanos suffered an accident which “changed her life in some way.” (Doc. # 45).

The telemarketer stated that the policy did not require total disability to afford benefits. (Doc. # 45). Pelekanos also received written materials by mail, which contributed to her understanding of the policy’s scope of coverage. (Doc. # 45). After enrolling in the policy, Pelekanos received a notice of coverage. (Doc. # 45).

Plaintiffs eventually became totally disabled due to accidents and filed claims for disability benefits with National Union. (Doc. # 45). National Union denied plaintiffs’ claims on the basis that their accidents did not result in dismemberment, paralysis, or blindness. (Doc. # 45).

At this time, plaintiffs discovered that these injuries were all that their policies covered. (Doc. # 45). Plaintiffs allege that defendants failed to truthfully disclose the nature of the insurance policies at issue. (Doc. # 45). National Union never sent the full policy documents to plaintiffs. (Doc. # 45).

On April 17, 2014, plaintiffs filed a complaint in this court alleging breach of contract and breach of the covenant of good faith and fair dealing against National Union, and fraud/intentional misrepresentation and conspiracy to defraud against National Union and BofA. (Doc. # 1).

On September 18, 2014, plaintiffs filed a motion to amend their complaint. (Doc. # 35). On October 16, 2014, the court granted the motion. (Doc. # 44). On October 20, 2014, plaintiffs filed an amended complaint asserting the same causes of action. (Doc. # 45). On November 6, 2014, BofA filed a motion to dismiss. (Doc. # 50). On November 17, 2014, National Union filed a motion to dismiss. (Doc. # 51).

On February 25, 2015, the court granted both motions to dismiss and instructed the clerk to close the case. (Doc. # 59). On March 25, 2015, plaintiffs filed the instant motion to reconsider. (Doc. # 63). On the ...


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