United States District Court, E.D. Washington
RICHARD H. PHILLIPS III, Plaintiff,
USAA CASUALTY INSURANCE COMPANY d/b/a “USAA, ” a TEXAS corporation, Defendant.
ORDER GRANTING IN PART PLAINTIFF'S MOTION FOR
(PARTIAL) SUMMARY JUDGMENT
O. RICE Chief United States District Judge.
THE COURT is Plaintiff Richard H. Phillips' Motion for
(Partial) Summary Judgment (ECF No. 42). The matter was heard
with oral argument on April 26, 2017. Troy Y. Nelson and Ryan
M. Best represent Plaintiff. Bradley E. Smith and Derek T.
Taylor represent Defendant. The Court has reviewed the record
and files herein, heard oral argument and is fully informed.
For the reason discussed below Plaintiff's Motion is
GRANTED IN PART.
instant case arises out of an underinsured motorist claim
submitted to Defendant USAA by its insured, Plaintiff Mr.
Phillips. The material facts are not in dispute for this
underlying accident occurred on November 29, 2013. ECF No. 45
at ¶ 5. Relevant to the issue before the Court,
Plaintiff settled with the at-fault driver for $25, 000 and
exhausted his PIP benefits of $10, 000 through
USAA. On March 19, 2014, Plaintiff told USAA
that he was “getting better[, ]” that his doctor
said that the release date of his treatment will be around
the first of April, and that he is a multi-sport athlete who
works out every day. ECF No. 53 at 74. Plaintiff did not seek
treatment for eight months after March, 2014, but then sought
chiropractic treatment and acupuncture until October 1, 2015.
ECF No. 52 at 4-5.
October 13, 2015, Plaintiff was involved in a similar motor
vehicle accident, where Plaintiff complained of tingling in
his lower back and right upper neck, for which Plaintiff
received chiropractic care and acupuncture under his PIP
policy. ECF Nos. 43-1 at 59; 53 at 79-83.
Philipps' counsel sent a letter dated April 19, 2016 to
USAA seeking to recover under Mr. Phillips' Underinsured
Motorist policy. The letter sought to settle Mr. Phillips
claim for the $100, 000 policy limit, citing (1) special
damages of $96, 000 (amounting to a claim of $61, 000 in
special damages after accounting for Plaintiff's recovery
of $10, 000 from his PIP insurance and $25, 000 from the
at-fault driver's insurance policy) and (2) other
unquantified damages for rehabilitation, economic loss, and
impact on Plaintiff's life. ECF No. 43-1 at 2-3. Included
with the letter was a March 15, 2016 declaration from
board-certified orthopedic surgeon Russell S. Vanderwilde,
M.D. ECF No. 43-1 at 53-54.
declaration states that Dr. Vanderwilde performed an MRI
study and that on a more probable than not basis
and based on a reasonable degree of medical certainty (1) Mr.
Phillip's torn shoulder and hip are related to the motor
vehicle accident of November 29, 2013 and (2) Mr. Phillips is
going to require surgery to repair the torn labra in his
shoulder and hip, and that but for the accident, Mr. Phillips
would not have had to incur the treatment bills, pain,
suffering and disability caused by his shoulder and hip
injuries. ECF No. 43-1 at 53. The letter states the shoulder
and hip operation will cost $35, 000 and $40, 000,
respectively, and that Mr. Phillips will need one year of
rehabilitation. ECF No. 43-1 at 53. The declaration did not
mention the October 13, 2015 accident.
sent a letter to Plaintiff's counsel dated May 6, 2016
offering $45, 000 ($16, 000 less than the unpaid, claimed
special damages and $55, 000 less than the policy limit); the
letter stated the “offer represents the fair value of
the claims.” ECF No. 43-1 at 11. Plaintiff's
counsel followed up with a letter dated May 9, 2016
requesting a check for the undisputed amount and informing
USAA that Mr. Phillips would be pursuing an Insurance Fair
Conduct Act claim for the remaining $55, 000, asserting the
offer is in bad faith and grossly under-evaluates the
damages. ECF No. 43-1 at 14. The letter noted that Mr.
Phillips is willing to give USAA 20 days to do a fair
investigation and to pay a fair settlement. ECF No. 43-1 at
replied with a letter dated May 27, 2016, stating that it
issued the undisputed amount; the letter did not mention the
remaining disputed amount. ECF No. 43-1 at 18.
Plaintiff's counsel then sent a letter dated May 31, 2016
noting that the May 27 letter did not address the disputed
amount. ECF No. 43-1 at 20. USAA replied by letter dated June
1, 2016, stating that USAA is “willing to negotiate, if
you are able to come off of the policy limit demand.”
ECF No. 43-1 at 22. Counsel for Mr. Phillips renewed its
demand for payment on June 1, 2016, ECF No. 43-1 at 24-26, to
which USAA replied on June 13, 2016 requesting copies of the
medical records and stating that USAA will be requesting a
peer review of the records upon receipt of the requested
films. ECF No. 43-1 at 29.
11, 2016, USAA confirmed receipt of the requested medical
records and stated that the records had been forwarded for a
peer review and that, when USAA receives the peer report they
will contact Mr. Phillips for further negotiations. ECF No.
43-1 at 40. USAA sought a peer review from Christopher Boone,
M.D., who issued a report on August 9, 2016 challenging Dr.
Vanderwilde's assertion that the hip and shoulder tears
were caused by the November 29, 2013 accident.
Phillips filed a Complaint against USAA CIC in the Washington
State Superior Court for Spokane County on September 27,
2016. ECF No. 1. Plaintiff is now seeking partial summary
judgment. ECF No. 42.
judgment may be granted to a moving party who demonstrates
“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). The moving party bears the
initial burden of demonstrating the absence of any genuine
issues of material fact. Celotex Corp. v. Catrett,
477 U.S. 317, 323 (1986). The burden then shifts to the
non-moving party to identify specific facts showing there is
a genuine issue of material fact. See Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 256 (1986). “The mere
existence of a scintilla of evidence ...