5 UNITED STATES DISTRICT COURT 6 FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7
8 KHOA PHAM, et al., CASE NO. 2:24-cv-01781-RSL 9 Plaintiffs, v. 10
11 AMERICAN FAMILY CONNECT ORDER GRANTING IN PART DEFENDANT’S MOTION FOR PROPERTY AND CASUALTY 12 INSURANCE COMPANY, S C U O M NT M IN A U RY IN J G U T D R G I M AL E N D T A A T N E D 13 Defendant. 14 15 This matter comes before the Court on defendant’s motion for summary judgment 16 (Dkt. 21) and motion for relief from the remaining case management deadlines (Dkt. 30). 17 Having reviewed the memoranda, declarations, and exhibits submitted by the parties, the 18 Court finds as follows: 19 A. Insurance Fair Conduct Act 20 Plaintiffs, proceeding pro se, set forth their claims in a narrative form, requesting a 21 fair settlement of their insurance claim as promised in the personal property coverage 22 policy issued by defendant American Family Connect Property and Casualty Insurance 23 Company. Dkt. 1-2. To the extent the complaint asserts a claim under Washington’s 24 Insurance Fair Conduct Act (“IFCA”), plaintiffs were required to “provide written notice 25 of the basis for the cause of action to the insurer and office of the insurance commissioner” 26 ORDER GRANTING IN PART DEFENDANT’S MOTION 1 twenty days prior to filing the cause of action. RCW 48.30.015(8(a). Defendant asserts that 2 plaintiffs failed to provide the statutorily required notice, Dkt. 24 at ¶ 19, and plaintiffs 3 have not addressed this argument or produced evidence that written notice was provided. 4 Because “IFCA's pre-suit notice provision is a mandatory condition precedent to an IFCA 5 lawsuit,” MKB Constructors v. Am. Zurich Ins. Co., 49 F. Supp. 3d 814, 840 (W.D. Wash. 6 2014) (collecting cases), plaintiffs’ IFCA claim is hereby DISMISSED. 7 B. Violations of the Washington Insurance Regulations 8 Plaintiffs also allege that defendant engaged in unfair settlement practices in 9 violation of WAC 284-30-330 and WAC 284-30-360. These insurance regulations contain 10 multiple subparts, each describing different duties or prohibitions imposed on insurers. The 11 only subpart specifically mentioned in opposition to defendant’s motion for summary 12 judgment is WAC 284-30-330(8). In their narrative, however, plaintiffs take issue with the 13 responsiveness of defendant’s communications, defendant’s failure to pay the replacement 14 cost (or even the original purchase price) of items for which they had original receipts, 15 defendant’s across-the-board depreciation of property that holds its value and misstatement 16 of valuation evidence provided, defendant’s refusal to consider photographs as part of 17 plaintiffs’ proof of loss, and defendant’s attempt to settle a $171,390 claim for 18 $29,181.34.1 19 WAC 284-30-330(8) prohibits insurers from “[a]ttempting to settle a claim for less 20 than the amount to which a reasonable person would have believed he or she was entitled 21 22 1 To the extent defendant objects to consideration of plaintiffs’ narrative because it is not in the form of a 23 declaration, the objection is overruled. “At the summary judgment stage, we do not focus on the admissibility of the evidence’s form. We instead focus on the admissibility of its contents.” Fraser v. Goodale, 342 F.3d 1032, 1036–37 24 (9th Cir. 2003). Rule 56 itself invites the submission of documents, such as discovery responses, that would not be admissible in their current form. Because the substance of plaintiffs’ narrative are within their personal knowledge and 25 could be admitted into evidence at trial through their testimony, it may be considered in the context of this motion.
ORDER GRANTING IN PART DEFENDANT’S MOTION 1 by reference to written or printed advertising material accompany or made part of an 2 application.” Plaintiffs have not identified any advertising material that may have given 3 rise to a belief that they were entitled to more than what was specified in the policy. 4 WAC 284-30-330(2) and (5) and WAC 284-30-360 require insurers to respond to 5 communications and affirm or deny coverage in a timely manner. Plaintiffs notified 6 defendant that they had incurred a theft loss on May 31, 2024. The parties communicated 7 in writing and over the phone fairly regularly between June 14, 2024, and September 18, 8 2024, the date defendant issued payment on the claim, with the longest time between 9 communication being a little more than a week. Dkt. 24. Based on the undisputed 10 chronology of this case, plaintiffs cannot show a violation of WAC 284-30-330(2) or (5) or 11 WAC 284-30-360. 12 Plaintiffs’ demand for immediate payment of the Replacement Cost Value of the 13 lost items may implicate WAC 284-30-330(1) and/or (6), but the argument reflects a 14 misunderstanding of the policy provisions. Unless and until plaintiffs replace a stolen item, 15 defendant is obligated to pay only its Actual Cash Value, which is the cost of the same 16 item in a used condition or, if a used item is not available in the market, the cost of the 17 same item in new condition less a reasonable deduction for wear and tear, deterioration, 18 and obsolescence. Dkt. 24 at 22 and 28. 19 To the extent plaintiffs are challenging the decision to depreciate collector items 20 that hold or increase value over time and/or defendant’s misstatement of the valuation 21 evidence provided by plaintiffs, a jury could find that these acts were unreasonable in the 22 circumstances of this case and in violation of WAC 284-30-330(3), (4), (6), and/or (7). 23 The evidence in the record regarding defendant refusal to consider the photographic 24 evidence plaintiffs provided in support of their claim may also persuade a jury that 25 defendant acted unreasonably in violation of WAC 284-30-030(1), (3), (4), and/or (7). 26 While the claims adjuster apparently told plaintiffs that photos of the stolen items would ORDER GRANTING IN PART DEFENDANT’S MOTION 1 not be considered as proof of authenticity and/or ownership, Dkt. 24 at 45 and Dkt. 24 at 2 ¶ 9, this pronouncement is not mirrored in or required by the policy itself. The amended 3 instructions for what to do in case of a loss direct insureds to prepare an inventory of the 4 lost property (including a description and the actual cash value), to provide a signed, sworn 5 proof of loss, to “[a]ttach all bills, receipts and related documents that justify the figures in 6 the inventory,” and to cooperate with the insurer as it investigates the claim. Dkt. 24 at 17. 7 When communicating with plaintiffs, the claims adjuster requested “original invoices, 8 cancelled checks, bill(s) of sale, credit card receipts, appraisal(s), or any other documents 9 to verify proof of ownership.” Dkt. 24 at 42. Plaintiffs provided the sworn statement of 10 loss, attesting that they were not claiming any property that had not been stolen and that 11 they were not attempting to deceive or defraud defendant. They also inventoried the stolen 12 items and signed an authorization for third parties to release purchase and gift information 13 in their possession. Dkt. 1-2 at 11-13 and 42-57. Although they were able to describe the 14 lost items, including their quantity, the original purchase price, and the current cost of 15 items of like kind and quality, they had minimal purchase documentation. They therefore 16 provided photographs of the claimed items, a few of which show an impressive wall 17 display of designer sneakers topped by what appears to be Transformer action figures and 18 many of which feature plaintiffs’ daughters displaying handbags in one of their bedrooms. 19 Dkt. 12.
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5 UNITED STATES DISTRICT COURT 6 FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7
8 KHOA PHAM, et al., CASE NO. 2:24-cv-01781-RSL 9 Plaintiffs, v. 10
11 AMERICAN FAMILY CONNECT ORDER GRANTING IN PART DEFENDANT’S MOTION FOR PROPERTY AND CASUALTY 12 INSURANCE COMPANY, S C U O M NT M IN A U RY IN J G U T D R G I M AL E N D T A A T N E D 13 Defendant. 14 15 This matter comes before the Court on defendant’s motion for summary judgment 16 (Dkt. 21) and motion for relief from the remaining case management deadlines (Dkt. 30). 17 Having reviewed the memoranda, declarations, and exhibits submitted by the parties, the 18 Court finds as follows: 19 A. Insurance Fair Conduct Act 20 Plaintiffs, proceeding pro se, set forth their claims in a narrative form, requesting a 21 fair settlement of their insurance claim as promised in the personal property coverage 22 policy issued by defendant American Family Connect Property and Casualty Insurance 23 Company. Dkt. 1-2. To the extent the complaint asserts a claim under Washington’s 24 Insurance Fair Conduct Act (“IFCA”), plaintiffs were required to “provide written notice 25 of the basis for the cause of action to the insurer and office of the insurance commissioner” 26 ORDER GRANTING IN PART DEFENDANT’S MOTION 1 twenty days prior to filing the cause of action. RCW 48.30.015(8(a). Defendant asserts that 2 plaintiffs failed to provide the statutorily required notice, Dkt. 24 at ¶ 19, and plaintiffs 3 have not addressed this argument or produced evidence that written notice was provided. 4 Because “IFCA's pre-suit notice provision is a mandatory condition precedent to an IFCA 5 lawsuit,” MKB Constructors v. Am. Zurich Ins. Co., 49 F. Supp. 3d 814, 840 (W.D. Wash. 6 2014) (collecting cases), plaintiffs’ IFCA claim is hereby DISMISSED. 7 B. Violations of the Washington Insurance Regulations 8 Plaintiffs also allege that defendant engaged in unfair settlement practices in 9 violation of WAC 284-30-330 and WAC 284-30-360. These insurance regulations contain 10 multiple subparts, each describing different duties or prohibitions imposed on insurers. The 11 only subpart specifically mentioned in opposition to defendant’s motion for summary 12 judgment is WAC 284-30-330(8). In their narrative, however, plaintiffs take issue with the 13 responsiveness of defendant’s communications, defendant’s failure to pay the replacement 14 cost (or even the original purchase price) of items for which they had original receipts, 15 defendant’s across-the-board depreciation of property that holds its value and misstatement 16 of valuation evidence provided, defendant’s refusal to consider photographs as part of 17 plaintiffs’ proof of loss, and defendant’s attempt to settle a $171,390 claim for 18 $29,181.34.1 19 WAC 284-30-330(8) prohibits insurers from “[a]ttempting to settle a claim for less 20 than the amount to which a reasonable person would have believed he or she was entitled 21 22 1 To the extent defendant objects to consideration of plaintiffs’ narrative because it is not in the form of a 23 declaration, the objection is overruled. “At the summary judgment stage, we do not focus on the admissibility of the evidence’s form. We instead focus on the admissibility of its contents.” Fraser v. Goodale, 342 F.3d 1032, 1036–37 24 (9th Cir. 2003). Rule 56 itself invites the submission of documents, such as discovery responses, that would not be admissible in their current form. Because the substance of plaintiffs’ narrative are within their personal knowledge and 25 could be admitted into evidence at trial through their testimony, it may be considered in the context of this motion.
ORDER GRANTING IN PART DEFENDANT’S MOTION 1 by reference to written or printed advertising material accompany or made part of an 2 application.” Plaintiffs have not identified any advertising material that may have given 3 rise to a belief that they were entitled to more than what was specified in the policy. 4 WAC 284-30-330(2) and (5) and WAC 284-30-360 require insurers to respond to 5 communications and affirm or deny coverage in a timely manner. Plaintiffs notified 6 defendant that they had incurred a theft loss on May 31, 2024. The parties communicated 7 in writing and over the phone fairly regularly between June 14, 2024, and September 18, 8 2024, the date defendant issued payment on the claim, with the longest time between 9 communication being a little more than a week. Dkt. 24. Based on the undisputed 10 chronology of this case, plaintiffs cannot show a violation of WAC 284-30-330(2) or (5) or 11 WAC 284-30-360. 12 Plaintiffs’ demand for immediate payment of the Replacement Cost Value of the 13 lost items may implicate WAC 284-30-330(1) and/or (6), but the argument reflects a 14 misunderstanding of the policy provisions. Unless and until plaintiffs replace a stolen item, 15 defendant is obligated to pay only its Actual Cash Value, which is the cost of the same 16 item in a used condition or, if a used item is not available in the market, the cost of the 17 same item in new condition less a reasonable deduction for wear and tear, deterioration, 18 and obsolescence. Dkt. 24 at 22 and 28. 19 To the extent plaintiffs are challenging the decision to depreciate collector items 20 that hold or increase value over time and/or defendant’s misstatement of the valuation 21 evidence provided by plaintiffs, a jury could find that these acts were unreasonable in the 22 circumstances of this case and in violation of WAC 284-30-330(3), (4), (6), and/or (7). 23 The evidence in the record regarding defendant refusal to consider the photographic 24 evidence plaintiffs provided in support of their claim may also persuade a jury that 25 defendant acted unreasonably in violation of WAC 284-30-030(1), (3), (4), and/or (7). 26 While the claims adjuster apparently told plaintiffs that photos of the stolen items would ORDER GRANTING IN PART DEFENDANT’S MOTION 1 not be considered as proof of authenticity and/or ownership, Dkt. 24 at 45 and Dkt. 24 at 2 ¶ 9, this pronouncement is not mirrored in or required by the policy itself. The amended 3 instructions for what to do in case of a loss direct insureds to prepare an inventory of the 4 lost property (including a description and the actual cash value), to provide a signed, sworn 5 proof of loss, to “[a]ttach all bills, receipts and related documents that justify the figures in 6 the inventory,” and to cooperate with the insurer as it investigates the claim. Dkt. 24 at 17. 7 When communicating with plaintiffs, the claims adjuster requested “original invoices, 8 cancelled checks, bill(s) of sale, credit card receipts, appraisal(s), or any other documents 9 to verify proof of ownership.” Dkt. 24 at 42. Plaintiffs provided the sworn statement of 10 loss, attesting that they were not claiming any property that had not been stolen and that 11 they were not attempting to deceive or defraud defendant. They also inventoried the stolen 12 items and signed an authorization for third parties to release purchase and gift information 13 in their possession. Dkt. 1-2 at 11-13 and 42-57. Although they were able to describe the 14 lost items, including their quantity, the original purchase price, and the current cost of 15 items of like kind and quality, they had minimal purchase documentation. They therefore 16 provided photographs of the claimed items, a few of which show an impressive wall 17 display of designer sneakers topped by what appears to be Transformer action figures and 18 many of which feature plaintiffs’ daughters displaying handbags in one of their bedrooms. 19 Dkt. 12. 20 Because most of the items claimed were expensive designer products (handbags, 21 shoes, perfume, electronics, etc.) for which plaintiffs lacked documentation, defendant 22 referred the claim for an internal fraud investigation. The investigator reviewed the list of 23 stolen items with plaintiffs, questioning them about particular receipts and purchases. 24 Plaintiffs stated that they had been collecting luxury items (particularly handbags and 25 shoes) for a long time, but had or could get receipts only for those items purchased locally. 26 Dkt. 24 at 70-71. Other items, such as beauty products, electronic devices, and perfumes, ORDER GRANTING IN PART DEFENDANT’S MOTION 1 were purchased for family members in Vietnam, who they planned to visit during the 2 summer of 2024. Dkt. 24 at 71. Overall, the investigator was able to confirm many of the 3 purchases for which documentation was provided, but found that two iPhones included in 4 the original inventory list had never been picked up from the store and that plaintiffs had 5 claimed the total paid for three Michael Kors items, despite only claiming that one of the 6 items (a handbag) had been stolen. According to the claims file, plaintiffs removed the 7 iPhones from the claim inventory before defendant raised the issue with them. Dkt. 24 at 8 83. With regards to the Michael Kors receipt, there is no indication that defendant followed 9 up with the insureds after it confirmed the purchases with the vendor. In the course of this 10 litigation, plaintiffs provided an item-by-item inventory linking the description of the item 11 with the photographs and purchase information they had. Dkt. 20. 12 During the investigation and at their depositions, plaintiffs explained that some of 13 the items they had collected were gifts and that others were purchased through Facebook 14 Marketplace, at conventions, and on Craigslist, venues that utilized cash payments. Dkt. 22 15 at 7; Dkt. 24 at 71 and 81. When defense counsel suggested that the pictures of the wall of 16 designer sneakers could have been taken at one of these conventions, Dkt. 12 at 2-3, Mr. 17 Pham disputed that assertion, claiming the collection belonged to him and had been built 18 up over a long period of time. Dkt. 22 at 7-8. There is no indication that defendant took 19 any steps to confirm or rebut the assertion that the photographs were taken at plaintiffs’ 20 home. Ultimately, defendant partially denied plaintiffs’ claim “due to lack of supporting 21 documentation.” Dkt. 24 at 99. See also Dkt. 24 at 88. The denial excluded coverage for 22 any items for which a receipt had not been provided, even if plaintiffs submitted 23 photographs of the items in their house or in their possession. Thus, defendant denied 24 certain claims because it refused to consider the photographs plaintiffs submitted. 25 Whether a blanket exclusion of photographic evidence in these circumstances, 26 without any investigation regarding whether the photographs were authentic and without ORDER GRANTING IN PART DEFENDANT’S MOTION 1 any finding of fraud, was reasonable is for the jury to decide. Similarly, whether defendant 2 reasonably altered the dollar values on certain receipts and whether it reasonably 3 depreciated the value of the collector’s items is an issue of fact that precludes summary 4 judgment. 5 C. Consumer Protection Act 6 The last question for the Court on this motion for summary judgment is whether 7 plaintiffs can obtain relief for unfair methods of competition or unfair/deceptive acts or 8 practices that violate WAC 284-30-330. “The Consumer Protection Act (CPA), ch. 1986 9 RCW, prohibits unfair and deceptive trade practices and can be enforced by private 10 citizens.” Peoples v. United Servs. Auto. Assoc., 194 Wn.2d 771, 774 (2019). Acts that 11 violate Washington insurance regulations affect the public interest, are per se unfair or 12 deceptive acts for purposes of the CPA, and are subject to that statute’s enforcement 13 provisions. Ngethpharat v. State Farm Mut. Auto. Ins. Co., No. 2:20-00454-MJP, 2025 14 WL 2161754, at * 7 (W.D. Wash. July 29, 2025); Peoples, 194 Wn.2d at 778. The Court 15 has already determined that the pro se plaintiffs adequately alleged facts that could support 16 a CPA claim and, as discussed above, there is evidence in the record from which a jury 17 could find that defendant acted unreasonably and in violation of WAC 284-30-330. There 18 is also ample evidence in the record to support a finding that the coverage denial deprived 19 plaintiffs of reimbursement arguably due and owing under their insurance policy, causing 20 them injury.2 21 D. Motion for Relief from Remaining Case Management Deadlines 22 Defendant’s request to vacate all remaining case management deadlines was ripe 23 for consideration as of January 5, 2026, and is unopposed. The Court finds that a 60-day 24 continuance of the trial date will allow the parties to evaluate the above determinations, 25 26 2 Plaintiffs have not pursued a common law bad faith or breach of contract claim in this case. ORDER GRANTING IN PART DEFENDANT’S MOTION 1 determine whether additional settlement discussions might be fruitful, and proceed to trial 2 in an orderly fashion. 3
4 For all of the foregoing reasons, defendant’s motion for summary judgment (Dkt. 5 21) is GRANTED as to plaintiffs’ IFCA claim but denied as to the CPA claim premised on 6 violations of WAC 284-30-330. Defendant’s unopposed motion to continue the remaining 7 case management deadlines (Dkt. 30) is GRANTED. A new case management order with a 8 trial date of April 6, 2026, will be issued. If the parties believe that settlement is a 9 possibility and would like the assistance of a court neutral in the process, they should 10 contact Teri Roberts, the Judicial Assistant, at Teri_Roberts@wawd.uscourts.gov on or 11 before January 29, 2026. 12
14 DATED this 12th day of January, 2026.
17 Robert S. Lasnik 18 United States District Judge 19 20 21 22 23 24 25 26 ORDER GRANTING IN PART DEFENDANT’S MOTION