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Felix v. CSAA General Insurance Company

United States District Court, D. Nevada

March 31, 2017

BLANCA FELIX, an individual, Plaintiff,
CSAA GENERAL INSURANCE COMPANY, a Nevada Corporation; DOES I through X; and ROE BUSINESS ENTITIES I through X, inclusive, Defendants.



         Blanca Felix claims that CSAA General Insurance Company acted in bad faith when it refused to pay her the policy limit on her underinsured motorist policy. Felix was injured in a car crash, and although she was paid $250, 000 by the driver of the other car, she contends that her injuries warranted additional payments from CSAA under Felix's underinsured policy. Felix sues CSAA for breaching its policy, handling her claim in bad faith, and using unfair claims practices under Nevada Revised Statutes section 686A.310.

         CSAA moves for summary judgment on the claims of bad faith and unfair practices, arguing that it had a reasonable basis to deny additional payments to Felix under its policy. Felix responds that she gave CSAA extensive medical documents to support her injuries and an expert report that opines CSAA failed to reasonably handle her claim in several ways.

         Because the reasonableness of CSAA's conduct is subject to debate, I deny its motion for summary judgment. That said, CSAA did not have a fair opportunity to depose Felix's expert and provide a rebuttal report of its own-and that could impact the validity of Felix's claims. I therefore will extend the deadline for dispositive motions so that the parties have the opportunity to file another motion for summary judgment if they wish.

         I. ANALYSIS

         A. Summary Judgment

         Summary judgment is appropriate when the pleadings, discovery responses, and other offered evidence show “there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.”[1] When considering summary judgment, I view all facts and draw all inferences in the light most favorable to the non-moving party.[2]

         If the moving party demonstrates the absence of any genuine issue of material fact, the burden shifts to the non-moving party to “set forth specific facts showing that there is a genuine issue for trial.”[3] The non-moving party “must do more than simply show that there is some metaphysical doubt as to the material facts.”[4] She “must produce specific evidence, through affidavits or admissible discovery material, to show” a sufficient evidentiary basis on which a reasonable fact finder could find in her favor.[5]

         B. A reasonable jury could conclude that CSAA act in bad faith.

         Bad faith is “an actual or implied awareness of the absence of a reasonable basis for denying benefits of the insurance policy.”[6] Where “relevant facts are in dispute or when facts permit differing inferences as to the reasonableness of insurers' conduct, ” a bad faith claim is generally a question for the jury.[7]

         The tortfeasor's insurer paid Felix its entire $250, 000 policy limits, but CSAA waited a significant time to tell Felix it would pay her nothing more than the $10, 000 required by the medical provision of her policy.[8] Felix provided CSAA with medical documentation showing that she had nearly $200, 000 in medical expenses; even a modest award for pain and suffering and lost wages would exceed what Felix had already received.[9] That is, assuming that Felix's damages were actually caused by the accident, which is the parties' primary dispute.

         CSAA argues that it had a reasonable basis for rejecting Felix's claim, primarily because it relied on an independent medical examiner who concluded that she suffered only minimal injuries in the crash and that her other injuries were preexisting.[10] But Felix's expert evidence calls into question whether CSAA could reasonably rely on this opinion.[11] First, CSAA waited until two years after the crash to order the examination.[12] Second, the examiner does not appear to have fully considered Felix's reports of subjective pain.[13]

         Third, the independent examiner's opinion that some of Felix's injuries (and her related need for surgery) were pre-existing does not appear well supported. The examiner may have relied on an MRI it did not initially have, and it is unclear what else the examiner relied on to reach his conclusion.[14] CSAA's claims handler admitted in a deposition that CSAA had no evidence that Felix had “any prior pain, any prior complaints, [or] any prior difficulties” before the accident, other than the examiner's conclusions.[15] CSAA thus relied solely on the independent examiner-who himself appears to have relied on little to no evidence-to conclude that Felix either did not need surgery or that the surgery was related to preexisting injuries. What's more, Felix sent CSAA a letter from her surgeon which explained why the independent examiner was mistaken: “it is very clear . . . [Felix] has no previous history of cervical spine pathology that ever necessitated treatment prior to the accident.”[16] CSAA's contentions about whether Felix really needed the surgery she underwent, and whether it is related to the crash, are also less persuasive given that CSAA had the opportunity to order the examination prior to her procedure but failed to do so.[17]

         Felix's expert explains at length why it was unreasonable for CSAA to rely on the independent examiner to deny Felix's claim.[18] Felix's expert reviewed all of her medical evidence and points out that the independent examiner did not consider all of the evidence he should have, and that the evidence he did consider did not support the conclusions he reached.[19]Taking all of this together, a reasonable jury could conclude that CSAA had no reasonable basis to deny Felix's claim.[20] I thus deny summary judgment as to Felix's bad faith claim.

         C. There are also triable issues as to Felix's ...

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