Geico General Insurance Company v. Laura B. Coyne, Cheryl A. O'Mailia, and James O'Mailia

7 N.E.3d 300, 2014 WL 1509209, 2014 Ind. App. LEXIS 159
CourtIndiana Court of Appeals
DecidedApril 17, 2014
Docket20A04-1307-CT-325
StatusPublished
Cited by4 cases

This text of 7 N.E.3d 300 (Geico General Insurance Company v. Laura B. Coyne, Cheryl A. O'Mailia, and James O'Mailia) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Geico General Insurance Company v. Laura B. Coyne, Cheryl A. O'Mailia, and James O'Mailia, 7 N.E.3d 300, 2014 WL 1509209, 2014 Ind. App. LEXIS 159 (Ind. Ct. App. 2014).

Opinions

OPINION

BROWN, Judge.

GEICO General Insurance Company (“GEICO”) appeals from the trial court’s Findings of Fact and Conclusions of Law [302]*302Addressing Plaintiffs Motion for a New Trial, entered on March 21, 2013, as well as from the court’s Final Order entered on June 5, 2013, in favor of Cheryl A. O’Mailia and James O’Mailia (collectively, the “O’Mailias”).1 GEICO raises three issues, which we consolidate and restate as whether the court erred in awarding attorney fees to the O’Mailias based upon GEICO litigating in bad faith. Additionally, the O’Mailias request appellate ■ attorney fees pursuant to Ind. Appellate Rule 66(E). We reverse and also deny the O’Mailias’ request for appelláte attorney fees.

FACTS AND PROCEDURAL HISTORY

On December 28, 2009, vehicles driven by Laura Coyne and Arlin Yoder were involved in an accident. Cheryl O’Mailia was a passenger in Coyne’s vehicle, and she sustained physical injuries from the accident, including fractures of the second cervical vertibra, the seventh cervical ver-tibra, the sternum, multiple rib fractures, and the mid ulna on her left arm. At the time of the accident, the O’Mailias were insured by GEICO under a policy providing underinsured motorist coverage with a limit of $600,000. Cheryl brought a claim under the policy for damages sustained and James brought a claim under the policy for loss of consortium.

Approximately one week before trial, counsel for GEICO discovered on the Florida Department of Health’s public website that James’s medical license had come under investigation based on numerous allegations, including that he had forged prescriptions for his wife (the “Florida Information”). The website noted that due to these allegations, the State of Florida arrested James on July 20, 2009, and charged him with thirteen counts of violating Fla. Stat. § 893.13(7)(a), by obtaining controlled substances by fraud. On September 1, 2009, James pled nolo contendere to five felony counts of violating Fla. Stat. § 831.02 by uttering a forged instrument. Also, on September 7, 2010, the Florida Surgeon General asked the Florida Board of Medicine to impose penalties including the revocation or suspension of James’s medical license, and in January 2011 James entered into a settlement agreement under the terms of which he agreed to pay a $30,000 fine and reimburse the Department of Health costs of between $21,254.15 and $24,254.15, was prohibited from treating or prescribing medications to family members, and had his medical license placed on probation for three years.

GEICO did not alert the O’Mailias of the Florida Information it had found, and apparently the O’Mailias did not tell their counsel about the same. On October 31, 2012, a jury trial commenced, and on the second day of trial James testified regarding the accident’s effect on him and his wife, as well as problems with his medical office. He testified that “had [his wife] not had the accident, I would suspect that this would have been nothing other than just a regular, American family — just trying to do the best we could.” Transcript at 187. On cross — examination, the following exchange occurred:

Q. But you said that before the accident you just had the problems of a regular, American family. Is that right?
A. I think so. Yes.
Q. Isn’t it true that you guys had something else going on in your family that most families aren’t dealing with?
A. What are you alluding to?
[303]*303Q. You can’t think of anything as you sit there?
A. No, not that I can think of. No.
Q. Okay. Isn’t it true that on July 20th of 2009, you were arrested and charged in the Circuit Court of Leon County in Florida with thirteen counts of violating section 89— or 893.13(7)(a) of the Florida statutes by obtaining controlled substances by fraud?

Id. at 188.

The O’Mailias objected, and following a brief bench conference the court sent the jury out of the courtroom. William Ramsey, counsel for GEICO, explained to the court that in Florida a conviction is entered following a plea of nolo contendere, that “fraud is a crime of dishonesty,” and that accordingly “it fits squarely within 609(a).” Id. at 194. Benjamin Ice, who was also counsel for GEICO, then explained that “the purpose of the question is that there is this whole issue that’s going on, a stressor in this family that affects how they’re relating to each other and stress and anxiety that [Cheryl] is experiencing,” that “having your husband arrested and charged in a criminal court is a highly stressful ordeal,” and that therefore “there is this purpose that’s beyond impeaching him as having been convicted of a crime of dishonesty.” Id. The court then asked why this information was not disclosed, and Attorney Ice replied as follows:

We looked very aggressively for any obligation to disclose it; there was none. We knew that if we disclosed it there would be a whole preparation on getting around it. This is substantive evidence. There was no written discovery that called for this, there was-we’re not using it as an exhibit, there was no obligation to disclose something that we found in a public record on the internet.

Id. at 194-195. The O’Mailias’ counsel, Edward Chester, responded he “utterly and totally disagree[d] with everything Mr. Ice just said,” that “[w]hat they’ve done is lay in ambush just like the lawyer did in Outback Steakhouse,”2 and he moved for a mistrial. Id: at 195. The court recessed and met with the attorneys in chambers, and afterwards invited the attorneys to make a record on the issues of disclosure and the duty to disclose, as well as Ind. Evidence Rules 609 and 403. After the O’Mailias renewed their motion for a mistrial, Attorney Ice explained the decision to not disclose as follows:

Our position when we discovered this — we tried to determine whether there was a duty to disclose. There were absolutely no written discovery requests to us at that point that required disclosure. Furthermore, there’s nothing under the Trial Rules that required disclosure. We evaluated every obligation that was made on us either by the rules of this court, of this state, or the pleadings in this case; we determined there was no duty to disclose. We opted not to disclose that information. It is our position that there is no duty to disclose this information.
By comparison is that in the same way that [the O’Mailias’ counsel] is not going to share with me his cross examination of Dr. Horn in this case, I have no duty to provide my cross examination of Dr. O’Mailia in this case....

Id. at 201. Attorney Ramsey also noted that although the court did not ask the attorneys to address Ind. Evidence Rule 404(b), it is relevant because that rule [304]

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7 N.E.3d 300, 2014 WL 1509209, 2014 Ind. App. LEXIS 159, Counsel Stack Legal Research, https://law.counselstack.com/opinion/geico-general-insurance-company-v-laura-b-coyne-cheryl-a-omailia-and-indctapp-2014.