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Allen v. United Services Automobile Association

United States Court of Appeals, Tenth Circuit

October 29, 2018

JEFFREY ALLEN, Plaintiff - Appellant,

          Appeal from the United States District Court for the District of Colorado (D.C. No. 1:16-CV-01056-RM-NYW)

          John M. DeStefano, of Hagens Berman Sobol Shapiro LLP, Phoenix, Arizona (Robert B. Carey, of Hagens Berman Sobol Shapiro LLP, Colorado Springs, Colorado, on the briefs), for Plaintiff-Appellant.

          Jeremy A. Moseley (John M. Vaught and Julian R. Ellis, Jr. with him on the brief), of Wheeler Trigg O'Donnell LLP, Denver, Colorado, for Defendant-Appellee.

          Before BRISCOE, SEYMOUR, and HOLMES, Circuit Judges.


         Plaintiff-Appellant Jeffrey Allen was injured in a car accident in May 2013. His automobile insurance policy includes coverage for medical expenses arising from car accidents, but this coverage contains a one-year limitation period such that he cannot obtain reimbursement for medical expenses that accrue a year or more after an accident. Mr. Allen, who seeks reimbursement for medical expenses accruing more than a year after his accident, argues that this limitation period is invalid for two separate reasons. First, he claims that, because a 2012 disclosure form that his insurer sent him stated that his policy covers reasonable medical expenses arising from a car accident, Colorado's reasonable-expectations doctrine renders the one-year limitations period unenforceable. Second, Mr. Allen argues that Colorado's MedPay statute, which requires car insurance companies to offer at least $5, 000 of coverage for medical expenses, prohibits placing a one-year time limit on this coverage. The district court granted summary judgment in favor of Mr. Allen's insurer, Defendant-Appellee United Services Automobile Association ("USAA"). We now reject both of Mr. Allen's arguments and, exercising jurisdiction under 28 U.S.C. § 1291, affirm the district court's order.


         Mr. Allen was insured under a car insurance policy purchased by his wife, Ellen Allen, from USAA. As relevant here, the policy's coverage period ran from December 5, 2012 to June 5, 2013, though Ms. Allen obtained the policy years before that. The policy included $100, 000 of coverage for "medical payments." Aplt.'s App., Vol. III, at 711 (Auto Policy Renewal Declarations, filed Oct. 26, 2017) (capitalization omitted). The policy stated that USAA "will pay only the medical payment fee for medically necessary and appropriate medical services" and that "[t]hese fees and expenses must . . . [r]esult from [a bodily injury] sustained by a covered person in an auto accident; and . . . [b]e incurred for services rendered within one year from the date of the auto accident." Id., Vol. I, at 203 (Ex. A-2 to Def.'s Statement of Undisputed Facts, filed Oct. 26, 2017). While the policy initially contained a three-year limitation period for medical payments, USAA sent Ms. Allen a disclosure in 2006 informing her of "Important Changes to Your Auto Policy," which included that the "time limit for Medical Payments Coverage is reduced from three years . . . to one year from the date of [an] accident." Id. at 177 (Ex. A-1 to Def.'s Statement of Undisputed Facts, filed Oct. 26, 2017). It is undisputed that, notwithstanding this change to her policy, Ms. Allen renewed it in December 2006 and continued to renew it thereafter until the car accident that forms the basis of this case occurred.

         In 2012, USAA sent the Allens a "Summary Disclosure Form" that purported to be "a basic guide to the major coverages and exclusions in your policy." Id. at 222 (capitalization omitted). The disclosure form stated that it was "not a policy of any kind," and instructed the Allens to "please read your policy for complete details" because "this summary disclosure form shall not be construed to replace any provision of the policy itself." Id. (capitalization omitted). The disclosure form discussed the Allens' "[m]edical payments coverage" under their policy. Id. at 224. It stated that this "[m]edical payments coverage pays for you and your passengers['] reasonable health care expenses incurred for bodily injury caused by an automobile accident." Id. The portion of the disclosure form discussing medical-payments coverage further instructed the Allens to "[p]lease read your policy for other conditions and exclusions." Id.

         In May 2013, within the policy's coverage period, Mr. Allen was involved in a car accident. Mr. Allen began suffering lower back pain shortly afterward. The policy provided coverage for up to $100, 000 worth of medical payments within the one-year limitation period. According to a clinical assessment carried out about a year after the accident, Mr. Allen's pain "range[d] anywhere from mild to severe on a daily basis." Id., Vol. III, at 625 (Ex. A-2 to Pl.'s Resp. to Def.'s Statement of Facts, filed Oct. 26, 2017). By June 2014, when the one-year limitation period on medical-payments coverage under Mr. Allen's policy had ended, USAA had paid out about $18, 000 of the $100, 000 coverage amount. Mr. Allen continued to receive medical treatment for problems stemming from the accident, but USAA refused to make further payments because the limitation period had been reached.

         In May 2016, Mr. Allen brought a class action suit against USAA, on behalf of "all insureds of [USAA]," in federal district court in Colorado. Id., Vol. I, at 10 (Class Action Compl., filed Oct. 26, 2017). He alleged diversity jurisdiction under the Class Action Fairness Act, 28 U.S.C. § 1332(d). Mr. Allen sought damages for, inter alia, breach of contract, the tort of bad faith, and deceptive trade practices, all under Colorado law. He also asked for declaratory relief that would have the effect of vitiating the time limits for medical-payments coverage in class members' policies.

         USAA filed an Answer to Mr. Allen's complaint in September 2016. In December 2016, USAA moved for summary judgment, and the district court granted this motion in July 2017. The district court entered final judgment against Mr. Allen on July 10, 2017, and Mr. Allen timely appealed.


         "We review a district court's summary-judgment order de novo," and summary judgment "is appropriate when 'the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.'" Dullmaier v. Xanterra Parks & Resorts, 883 F.3d 1278, 1283 (10th Cir. 2018) (quoting Fed.R.Civ.P. 56(a)). As to materiality, "[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). And disputes are genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. We "view the evidence and draw reasonable inferences therefrom in the light most favorable to the nonmoving party" at the summary-judgment stage. Dullmaier, 883 F.3d at 1283 (quoting Simms v. Okla. ex rel. Dep't of ...

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