Wikler v. Privilege Underwriters Inc.

          ORDER

          G. Murray Snow Chief United States District Judge

         Pending before the Court are the Motion for Summary Judgment of Defendant Privilege Underwriters, Inc. (Doc. 163) and the Motion for Partial Summary Judgment of Plaintiffs Louis and Randi Wikler (Doc. 161). For the reasons set forth below, both motions are denied.^[1]

         BACKGROUND

         The Court “evaluate[s] each motion [for summary judgment] independently, giving the nonmoving party in each instance the benefit of all reasonable inferences.” Lenz v. Universal Music Corp., 815 F.3d 1145, 1150 (9th Cir. 2015) (citation and internal quotation marks omitted).

         I. The Wiklers' Injuries

         The Wiklers were involved in an automobile accident on April 14, 2014. Louis Wikler was diagnosed with a contusion of the chest wall as a result of the accident. Randi Wikler was more seriously injured than her husband-she fractured part of her left foot, and the injury aggravated an underlying congenital condition. After a few months in a protective boot, the fractures healed, and Ms. Wikler was able to take short hikes with the aid of hiking poles. Soon thereafter, however, she experienced pain in her ankle and was diagnosed with torn ligaments. On the recommendation of her doctor, Ms. Wikler underwent surgery in June 2016. However, that surgery was also not entirely successful, and Ms. Wikler's doctors have recommended another future operation.

         II. The Wiklers' Claim

         The other driver was at fault in the accident but was insured only with state minimum liability limits of $15, 000/$30, 000. The Wiklers accepted the policy limits offered by the other driver's insurance a few months after the accident. At the time of the accident, the Wiklers' insurance policy with Defendants Privilege Underwriters Reciprocal Exchange and Privilege Underwriters, Inc. (“PURE”) provided underinsured motorist coverage (“UIM”). The UIM provision of the contract states:

We will pay compensatory damages which an “insured” is legally entitled to recover from the owner or operator of an “underinsured motor vehicle” because of “bodily injury”:

1. Sustained by an “insured”; and

2. Caused by an accident.

(Doc. 162 at 53).^[2]

         The Wiklers informed PURE that they would be claiming the balance of their expenses pursuant to the UIM provision. PURE assigned Sandra Manzella to handle the claim.

         In January 2015, Ms. Manzella asked the Wiklers if she could provide medical authorization forms to them to sign so that Ms. Manzella could begin gathering medical records. The Wiklers declined, citing implications with possible medical liens against them. In July 2015, Ms. Manzella sent medical authorization forms to the Wiklers so she could begin gathering the medical records. By October, the Wiklers had not signed the medical authorizations, but did send a demand letter to Ms. Manzella along with partial medical records. The following January, the Wiklers sent more medical records to Ms. Manzella.

         In response to the demand letter, Ms. Manzella made a settlement offer: $8, 000 for Louis, and $40, 000 for Randi. The Wiklers informed Ms. Manzella that Randi had been forced to miss work from April 2015 to August 2015; Ms. Manzella responded that the records provided so far did not indicate that Randi had missed five months of work, and that without documentation of the missed work she could not simply take the Wiklers' word for it.

         In February 2016, Ms. Manzella made a global settlement offer of $60, 000 based on the records available to her. She also indicated that she would be willing to review any additional documentation that the Wiklers provided. The Wiklers made a counteroffer of $100, 000. Ms. Manzella countered that offer with an offer of $70, 000. The Wiklers then informed Ms. Manzella that Randi had been advised that she needed surgery on her ankle, and Ms. Manzella stated that she would need to re-evaluate the claim based on that information. Following the surgery, the Wiklers notified Ms. Manzella that Randi had lost her job because of her injuries. Ms. Manzella informed the Wiklers that she needed documentation to evaluate the claim and sent medical and employment authorizations to the Wiklers.

         Several months later, in February 2017, the Wiklers provided the signed authorizations. Ms. Manzella then requested and received medical records from various medical providers and employers. In March 2017, the Wiklers sent another demand letter to Ms. Manzella in the amount of $1, 432, 450.50. Ms. Manzella again responded that she would review the demand once she had obtained the necessary records. After the Wiklers provided more medical records, Ms. Manzella informed the Wiklers she would be completing her evaluation based on the records in her possession as of April 5, 2017.

         The Wiklers' claim file around that date contains the following notes:

SETTLEMENT RANGE:

-2 fractures in ankle with no surgery, up to 2 years oftreatment, ...