Phan v. Transamerica Premier Life Insurance Company

• Court: District Court, N.D. California
• Decided: April 17, 2023
• Docket: 5:20-cv-03665
• Status: Unknown

Opinion

1 2 3 UNITED STATES DISTRICT COURT 4 NORTHERN DISTRICT OF CALIFORNIA 5 SAN JOSE DIVISION 6 7 DUNG PHAN, Case No. 20-cv-03665-BLF

8 Plaintiff, ORDER DENYING APPLICATION TO 9 v. FILE SUPPLEMENTAL BRIEFING AND DENYING MOTION FOR CLASS 10 TRANSAMERICA PREMIER LIFE CERTIFICATION WITHOUT INSURANCE COMPANY, PREJUDICE 11 Defendant. [Re: ECF Nos. 57, 69] 12

13 On April 12, 2023, Defendant filed an ex parte application for leave to file supplemental 14 briefing on Plaintiff’s motion for class certification. ECF No. 69 (“App.”). In the Application, 15 Defendant asserts that Plaintiff’s Reply brief to her motion for class certification altered her 16 position, and Defendant did not have a sufficient opportunity to respond. Id. Defendant has 17 identified a significant problem with Plaintiff’s briefing in support of class certification. 18 In the Complaint, Plaintiff asserts five causes of action: (1) declaratory relief or judgment 19 under California statute; (2) declaratory relief or judgment under federal statute; (3) breach of 20 contract; (4) violation of California’s Unfair Competition Law (“UCL”); and (5) financial elder 21 abuse in violation of California statute. ECF No. 1 (“Compl.”) ¶¶ 52-96. The claims for 22 declaratory relief seek a determination of rights and duties and declaration or judgment “that 23 Sections 10113.71 and 10113.72 applied as of January 1, 2013, to Defendant’s California policies 24 in force as of or at any time after January 1, 2013.” Id. ¶¶ 59, 64. The Complaint identifies a class 25 and sub-class as follows: 26 The Class: 27 governed by Sections 10113.71 and/or 10113.72, where the policies 1 underwent or will undergo lapse, termination, and/or reinstatement without Defendant first providing written notice of and an actual 60- 2 day grace period, a 30-day notice of pending lapse and termination, and/or an annual notice of a right to designate at least one other person 3 to receive notice of lapse or termination of a policy for nonpayment of premium. 4 The Elder Abuse Sub-Class: 5 All members of the Class defined above who were also 65 years of 6 age or older at the time the policy lapse [sic] or terminated. 7 Id. ¶ 39. 8 In the motion for class certification, Plaintiff seeks certification of the following classes:

9 The Class:

10 All owners, or beneficiaries upon a death of the insured, of Defendant’s life insurance policies issued in California before 2013 11 that Defendant lapsed or terminated for the non-payment of premium in or after 2013 without first complying with all the requirements of 12 Insurance Code Sections 10113.71 and 10113.72

13 The Elder Abuse Sub-Class:

14 All members of the Class who were also 65 years of age or older at the time their policy lapsed or terminated. 15 ECF No. 57 (“Mot.”) at 4. Plaintiff asserts that class certification is proper under Federal Rules of 16 Civil Procedure 23(b)(2) and 23(b)(3). See Mot. She recognizes that the case is “first and 17 foremost, one for declaratory and injunctive relief,” but she also seeks certification of a damages 18 class. Id. at 17. She highlights a central question as: “Where Defendant admittedly terminated life 19 insurance policies without first complying with Insurance Code sections 10113.71 and 10113.72, 20 were those terminations effective?” Id. at 2. 21 In the Reply, Plaintiff states for the first time that she is only seeking certification for a 22 “partial ‘damages’ class, under 23(b)(3), for the very small percentage (about 1.5%) of all policies 23 that might be entitled to benefits under the couple of counts that would award damages.” ECF No. 24 61 (“Reply”) at 2-3. She further explains that she “is not seeking monetary damages on behalf of 25 class members whose insureds are still alive, i.e., whose entitlement to benefits has not been 26 triggered yet.” Id. at 10 (emphasis in original). She concedes that 98.5% of potential class 27 members can only seek declaratory/injunctive relief. Id. at 11. And as to Rule 23(b)(2), she states 1 that she is seeking “a declaration that The Statutes applied to their policies (to the extent 2 Defendant still does not concede this), and that Defendant’s attempted terminations were 3 ineffective.” Id. at 10. 4 In the Application, Defendant asserts that it did not have the opportunity to respond to 5 Plaintiff’s changed position. App. at 2. Defendant argues that “[h]ad Plaintiff properly amended 6 the class definition in her Complaint or filed a new motion for certification with a modified and 7 narrower class definition, Transamerica would have been provided with an opportunity to address 8 the propriety of that new and altered relief.” Id. at 3. Defendant also asserts that “[t]he current 9 version of declaratory relief that Plaintiff asserted for the first time at oral argument is apparently 10 the only remaining claim on behalf of the entire class.” Id. at 3. Defendant requests leave to file a 11 supplemental brief to address Plaintiff’s position. See id. at 4-5. 12 Defendant has identified a fundamental flaw in Plaintiff’s motion. “It is improper for the 13 moving party to ‘shift gears’ and introduce new facts or different legal arguments in the reply brief 14 than presented in the moving papers.” Fisher v. Paykel Healthcare Ltd. v. Flexicare Inc., No. 15 SACV 19-835 JVS (DFMx), 2021 WL 5994996, at *6 (C.D. Cal. July 7, 2021) (Premier Constr. 16 & Remode, Inc. v. Mesa Underwriters Special Ins. Co., No. EDCV 18-2582 JGB (KKx), 2020 WL 17 5498072, at *10 (C.D. Cal. July 8, 2020)). The Court agrees with Defendant that Plaintiff 18 significantly altered her theory of class certification in the Reply. But the Court does not agree 19 that supplemental briefing from Defendant would be helpful at this stage, because there are several 20 issues that need to be addressed by Plaintiff. First, Plaintiff states in Reply that she seeks to 21 certify a “partial” damages class. Reply at 2-3. But neither her Complaint nor her motion for 22 class certification defines a damages sub-class. See Compl.; Mot. It is not clear if she does seek 23 to certify a damages sub-class and, if so, how she would like to define that sub-class. And second, 24 Plaintiff makes clear in her briefing that she is seeking a Rule 23(b)(2) class for declaratory relief 25 that is not requested in the Complaint. Mot. at 2; Reply at 10. The Complaint asks for a 26 declaration “that Sections 10113.71 and 10113.72 applied as of January 1, 2013, to Defendant’s 27 California policies in force as of or at any time after January 1, 2013.” Compl. ¶¶ 59, 64. But, as 1 Protective Life Ins. Co., 12 Cal. 5th 213, 220 (2021) (“We conclude that sections 2 10113.71 and 10113.72 apply to all life insurance policies in force when these two sections went 3 into effect, regardless of when the policies were originally issued.”); see also Pitt v. Metro. Tower 4 Life Ins. Co., No. 20-CV-694-RSH-DEB, 2022 WL 17972167, at *6 (S.D. Cal. Dec. 1, 2022) 5 (noting that question common to class members—whether “the protections of insurance code 6 sections 10113.71 and 10113.72 apply to Defendant’s insurance policies originally issued before 7 1/1/2013”—had already been decided by McHugh); Nieves v. United of Omaha Life Ins. Co., No. 8 21-cv-01415-H-KSC, 2023 WL 2705836, at *6 (S.D. Cal. Mar. 28, 2023) (stating that declaration 9 sought by plaintiff—that “Sections 10113.71 and 10113.72 applied as of January 1, 2013 to 10 Defendant’s California policies in force as of or any time after January 1, 2013”—was decided by 11 McHugh). Plaintiff indicates in her Reply that she is asking this Court for “a declaration that The 12 Statutes applied to their policies (to the extent Defendant still does not concede this), and that 13 Defendant’s attempted terminations were ineffective.” Reply at 10 (emphasis added). The latter 14 portion of the sought declaration—that the terminations were ineffective—is not requested in the 15 Complaint. See Compl. 16 A supplemental brief by Defendant would not be helpful without a motion for class 17 certification that is consistent with Plaintiff’s changed requests. The Court DENIES Defendant’s 18 Application for leave to file a supplemental brief. The Court DENIES Plaintiff’s motion for class 19 certification WITHOUT PREJUDICE to refiling a new motion for class certification consistent 20 with Plaintiff’s position in her Reply brief. And to the extent that any changed theory of the case 21 would require the filing of an amended complaint, Plaintiff shall seek leave of court to do so prior 22 to filing a renewed motion for class certification. 23 // 24 // 25 // 26 // 27 // 1 The Court hereby modifies the case schedule to allow for a renewed motion for class 2 || certification to be filed by May 19, 2023. The Court will determine at a later date whether 3 postponement of the remainder of the case schedule would be required. This will allow the parties 4 || to fully brief the issues. 5 IT IS SO ORDERED. 6 7 || Dated: April 17, 2023 . Lancia BETH LABSON FREEMAN 9 United States District Judge 10 11 12

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