United States District Court, D. Arizona
G. Campbell, Senior United States District Judge
Cynthia Cheney filed a complaint against Defendants United
States Life Insurance Company (“U.S. Life”) and
American General Life Insurance Company (“American
General), d/b/a AIG Benefit Solutions, alleging breach of
contract and insurance bad faith. Doc. 1. Defendants move for
summary judgment. Doc. 92. The motion is fully briefed, and
the Court finds that oral argument will not aid in its
decision. See Fed. R. Civ. P. 78(b); LRCiv 7.2(f).
For the following reasons, the Court will grant the motion.
following facts are undisputed unless otherwise noted. U.S.
Life issued a disability insurance policy (“the
Policy”) to an association, the American Bar Endowment
(“ABE”). Doc. 93-1 at 2-3. As an ABE member,
Plaintiff was covered by the Policy. Id. at 35. The
Policy provides for the payment of benefits “[i]f an
insured person becomes totally disabled and continues to be
so disabled past the waiting period.” Id. at
9. The Policy defines “total disability” as:
. during the waiting period and next 60
months, the complete inability of the member to perform the
material duties of [her] regular job to include [her]
specialty in the practice of law; “specialty in the
practice of law” means the specialty in the practice of
law which the member was performing on the day before total
. after such 60 months, the complete
inability of the member to perform the material duties of any
gainful job for which [she] is reasonably fit by training,
education or experience.
Id. An insured's “regular job” is
“that which [she] was performing on the day before
total disability began.” Id.
worked generally as an attorney from 1985 to 1990, and then
began medical malpractice trial work. Doc. 93-1 at 38-39. As
a trial lawyer, Plaintiffs “material duties”
included managing complex litigation through trial and
appeals, travel, conducting written discovery and
depositions, researching, drafting motions and other
documents, attending hearings and oral arguments, and being
involved in all aspects of trial preparation and execution.
Doc. 93-2 at 132-40, 143. Plaintiff tried seven cases between
1997 and 2005, and tried her last case in November 2005 with
a colleague's help. Doc. 93-2 at 119-24; 93-1 at 44, 66.
January 17, 2014, Plaintiff submitted a claim for total
disability to ABE. Doc. 93-1 at 38. Plaintiff asserted that
her disability began in December 2006 and that she had been
unable to continue working as a trial lawyer due to
uncontrolled diabetes and other health conditions.
Id. at 38-39. Plaintiff s claim included an
Attending Physician's Statement from a treating nurse
practitioner which indicated that Plaintiff had a moderate
limitation of functional capacity due to her arthritis.
Id. at 49. The statement opined that Plaintiff was
unable to work due to disability as of July 1, 2012.
February 2014 letter to Plaintiff, U.S. Life verified that
“Benefit Solutions Connecticut Claim Center” had
received her claim. Doc. 93-1 at 98. The letter requested
additional information from Plaintiff, including a specific
disability date, monthly billable hours, medical
documentation, tax returns, an explanation for her delay in
filing, and other documentation. Id. at 98-99. U.S.
Life again requested this information from Plaintiff in a
March 2014 letter. Id. at 120; Doc. 106 at 3.
Plaintiff attended an in-person interview about her claim
(Doc. 93-1 at 56), but U.S. Life closed her claim in July
2014 after several more unsuccessful requests for additional
information (Doc. 93-1 at 148-50).
eventually provided the requested information, and U.S. Life
reopened her claim. Doc. 93-1 at 113-14. In a March 2015
letter, Plaintiff updated her date of disability to no later
than January 1, 2007 and stated that she had wound down her
litigation activities by January 2008. Doc. 93-1 at 154-57.
Plaintiff also provided a spreadsheet of her hours billed
from July 2006 to June 2007. Docs. 93-2 at 3-4; 93-1 at
160-63. Plaintiff's hours billed, Claimant Statement, and
Social Security Administration disability application reflect
that she began litigating part-time in 2005. Id.;
Docs. 93-2 at 9; 93-1 at 87. Plaintiff attended a court
hearing as counsel of record in 2007 and was identified as
counsel of record in another case that year. Docs. 94-2 at
77; 93 at 9 ¶ 51; 106 at 7 ¶ 51.
Life obtained an opinion from a board-certified
endocrinologist, Dr. Soodini, that medical records did not
support Plaintiff's claimed severe limitations as of
2007. Doc. 93-2 at 21-27. U.S. Life denied Plaintiff's
claim on July 22, 2015, finding “insufficient
information to support that [Plaintiff] was Totally Disabled
through and beyond her policy's 90-day Waiting
Period.” Doc. 93-2 at 37-41.
Summary Judgment Standard.
seeking summary judgment “bears the initial
responsibility of informing the district court of the basis
for its motion, and identifying those portions of [the
record] which it believes demonstrate the absence of a
genuine issue of material fact.” Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). Summary judgment is
appropriate if the evidence, viewed in the light most
favorable to the nonmoving party, shows “that there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). Summary judgment is also appropriate against a party
who “fails to make a showing sufficient to establish
the existence of an element essential to that party's
case, and on which that party will bear the burden of proof
at trial.” Celotex, 477 U.S. at 322. Only
disputes over facts that might affect the outcome of the suit
will preclude summary judgment, and the disputed evidence
must be “such that a reasonable jury could return a
verdict for the nonmoving party.” Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
1 and 2 assert claims for breach of contract and bad faith,
respectively. Doc. 1. Defendants move for summary judgment on
both claims. Doc. 92.
Breach of Contract.
succeed on her breach of contract claim, Plaintiff has the
burden of proving the existence of a contract, breach of the
contract, and resulting damages. Thomas v. Montelucia
Villas, LLC, 302 P.3d 617, 621 (Ariz. 2013). American
General argues that summary judgment is proper because
American General had no contract with Plaintiff. Docs. 92 at
12, 14; 105 at 17-18. The parties agree that American General
and U.S. Life are subsidiaries of American International
Group, Inc. and are distinct legal entities. Docs. 93 at 9;
106 at 8-9.
argues that American General may be liable based on its
alleged involvement in denying Plaintiff's claim or based
on a joint venture theory. She also seems to treat American
General, a subsidiary of American International Group, as
synonymous with American International Group. Docs. 106 at
8-9, ¶56; 108 at 10-11; 105 at 17-18.Defendants assert
that American General played no role in issuing,
underwriting, or administering the Policy, or in denying
Plaintiff's claim. Doc. 108 at 10.
makes no coherent argument explaining how American General, a
non-party to the Policy between Plaintiff and U.S. Life, can
face breach of contract liability. Plaintiff fails to develop
or support her “direct involvement” or
“joint venture” theories. And her unexplained
citations to and quotations from bad faith cases are
unavailing on this breach of contract claim. See
Gatecliff v. Great Rep. Life Ins., 821 P.2d 725, 730
(Ariz. 1991) (discussing bad faith cases); Ceimo v. Gen.
Am. Life Ins. Co., 137 Fed. App'x 968, 969 (9th Cir.
2005) (memorandum decision citing Gatecliff without
analysis); Ingram v. Great Am. Ins., 112 F.Supp.3d
934, 940-41 (D. Ariz. 2015) (bad faith claim); Sparks v.
Rep. Nat'l Life Ins., 647 P.2d 1127, 1136-37 (Ariz.
1982) (same); Farr v. Transamerica Occidental Life
Ins., 699 P.2d 376, 385-86 (Ariz.Ct.App. 1984) (citing
Sparks for support that an insurer and its agent are
joint venturers and can be jointly liable for bad faith).
importantly, Plaintiff cites no evidence in the record
showing that American General was party to a contract with
Plaintiff, was involved in writing or administering the
Policy, or was involved in denying Plaintiff benefits. In
fact, the portion of Plaintiff's brief addressing this
issue contains only a single citation to the record - a
3-page excerpt from a deposition in a different case.
See Doc. 105 at 17-18 (citing Doc. 106-4 at 3-5).
This evidence does not establish the elements of
Plaintiff's claim in this case, and her conclusory