Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-14-35397/USCOURTS-ca9-14-35397-0/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

LORRAINE BATES; CHARLES 

EHRMAN BATES; EILEEN 

BURKE; JACI EVANS, as 

Successor Personal 

Representative for the Estate 

of Thomas Marier; and 

DALLA FRANCIS, as Personal 

Representative for the Estate 

of George Alexander,

Plaintiffs-Appellants,

v.

BANKERS LIFE AND 

CASUALTY COMPANY, an 

Illinois insurance company; 

CNO FINANCIAL GROUP,

INC., a Delaware corporation,

Defendants-Appellees.

No. 14-35397

D.C. No.

3:13-cv-00580-PK

ORDER CERTIFYING 

A QUESTION TO THE 

OREGON SUPREME 

COURT

Filed February 24, 2017

Before: Richard R. Clifton, Mary H. Murguia,

and Jacqueline H. Nguyen, Circuit Judges.

 Case: 14-35397, 02/24/2017, ID: 10331806, DktEntry: 50, Page 1 of 8
2 BATES V. BANKERS LIFE & CAS. CO.

SUMMARY*

Certification to Oregon Supreme Court

The panel certified the following question of state law 

to the Oregon Supreme Court:

Does a plaintiff state a claim under Oregon 

Revised Statutes § 124.110(1)(b) for 

wrongful withholding of money or property 

where it is alleged that an insurance company 

has in bad faith delayed the processing of 

claims and refused to pay benefits owed 

under an insurance contract?

COUNSEL

Rachele R. Selvig (argued) and Christopher L. Cauble,

Cauble & Cauble LLP, Grants Pass, Oregon; Michael L. 

Williams and Leslie W. O’Leary, Williams O’Leary LLC, 

Portland, Oregon; for Plaintiffs-Appellants.

Adam J. Kaiser (argued), Jeffrey J. Amato, and Matthew A. 

Stark, Winston & Strawn LLP, New York, New York; Ilan 

Wurman, Winston & Strawn LLP, Washington, D.C.; Vicki 

L. Smith, Lane Powell PC, Portland, Oregon; for 

Defendants-Appellants.

 

* This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.

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BATES V. BANKERS LIFE & CAS. CO. 3

ORDER

Pursuant to Oregon Revised Statutes § 28.200, we 

certify to the Oregon Supreme Court the following question:

Does a plaintiff state a claim under Oregon 

Revised Statutes § 124.110(1)(b) for 

wrongful withholding of money or property 

where it is alleged that an insurance company 

has in bad faith delayed the processing of 

claims and refused to pay benefits owed 

under an insurance contract?

The answer to this question will determine the outcome of 

this appeal. We find no controlling precedent in the 

decisions of the Oregon Supreme Court or intermediate 

appellate courts. We will adhere to the answer provided by 

the Oregon Supreme Court. We do not presume to bind the 

Oregon Supreme Court to our framing of this question of 

state law, and we recognize that the Oregon Supreme Court 

may, in its discretion, answer this question in any form that 

it chooses. If the Oregon Supreme Court declines 

certification, we will resolve the question according to our 

best understanding of Oregon law.

I.

Plaintiffs are elderly Oregonians or their successors who 

purchased long-term healthcare insurance policies sold by 

Bankers Life and Casualty Company and its parent 

company, CNO Financial Group, Inc. (“Bankers”). These 

policies are designed to provide health services for elderly 

people who can no longer care for themselves and are 

intended to cover expenses for in-home care providers, 

assisted living facilities, and nursing homes.

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4 BATES V. BANKERS LIFE & CAS. CO.

Plaintiffs allege that Bankers developed onerous 

procedures to delay and deny insurance claims. Examples 

of these procedures include failing to answer phone calls,

losing documents, delaying or denying claims without 

notifying policyholders, denying claims for reasons that did 

not comport with Oregon law, and paying policyholders less 

than what they were owed under their policies. Bankers 

allegedly collected premium payments and, without good 

cause, delayed and denied insurance benefits to which 

Plaintiffs were entitled under their policies.

Plaintiffs brought suit in the District Court of Oregon, 

seeking damages and equitable relief. They asserted claims 

for breach of contract, intentional misconduct, fraud, and 

violations of Oregon’s financial abuse statute. Pursuant to 

Federal Rule of Civil Procedure 12(b)(6), the district court 

dismissed, inter alia, Plaintiffs’ financial abuse claim on the 

ground that Oregon’s financial abuse statute applies only in 

the “bailment or trust scenarios expressly referenced in the 

statutory language.” Bates v. Bankers Life & Cas. Co., 993 

F. Supp. 2d 1318, 1345 (D. Or. 2014).

On appeal, Plaintiffs challenge the dismissal of their

claim under Oregon’s financial abuse statute. We now 

certify to the Oregon Supreme Court the question regarding 

the scope of Oregon’s financial abuse statute and ask the 

Court to exercise its discretion to accept and answer this 

question.

II.

Oregon Revised Statutes §§ 124.100 through 124.140 

establish a framework for bringing a civil action for abuse of 

a vulnerable person. The financial abuse statute states in 

relevant part: 

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BATES V. BANKERS LIFE & CAS. CO. 5

(1) An action may be brought . . . for 

financial abuse in the following 

circumstances:

. . . .

(b) When a vulnerable person requests 

that another person transfer to the 

vulnerable person any money or property 

that the other person holds or controls and 

that belongs to or is held in express trust, 

constructive trust or resulting trust for the 

vulnerable person, and the other person, 

without good cause, either continues to 

hold the money or property or fails to take 

reasonable steps to make the money or 

property readily available to the 

vulnerable person when:

(A) The ownership or control of the 

money or property was acquired in 

whole or in part by the other person or 

someone acting in concert with the 

other person from the vulnerable 

person; and

(B) The other person acts in bad faith, 

or knew or should have known of the 

right of the vulnerable person to have 

the money or property transferred as 

requested or otherwise made 

available to the vulnerable person.

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6 BATES V. BANKERS LIFE & CAS. CO.

Or. Rev. Stat. § 124.110. Plaintiffs contend that this statute 

allows them to recover the insurance benefits to which they 

are contractually entitled.1

Plaintiffs argue that the statute is broad enough to 

encompass claims against insurance companies for benefits 

due under their insurance policies. A claim is actionable, 

they assert, when a person “continues to hold” or “fails to 

take reasonable steps” to make available the vulnerable 

person’s money or property. Id. at § 124.110(1)(b). 

Plaintiffs also contend that the statute imposes liability as 

long as the defendant “acts in bad faith, or knew or should 

have known of the right of the vulnerable person to have the 

money or property transferred as requested.” Id. at 

§ 124.110(1)(b)(B). In addition to the text of the statute, 

Plaintiffs rely on a statutory list of exempted institutions that 

does not include insurance companies, Or. Rev. Stat. 

§ 124.115, the 1999 expansion of the financial abuse statute, 

1999 Or. Laws, ch. 305, and federal district court decisions 

construing California’s financial abuse statute, see Rosove v. 

Cont’l Cas. Co., No. 14-CV-01118, 2014 WL 2766161, at 

*5 (C.D. Cal. June 2, 2014); Johnston v. Allstate Ins. Co., 

No. 13-CV-574, 2013 WL 2285361, at *4 (S.D. Cal. May 

23, 2013).

Bankers on the other hand argues that the scope of 

Oregon’s financial abuse statute, by its plain language, does 

 

1 Although Plaintiffs had alleged that Bankers induced them to enter 

into their long-term healthcare policies, Plaintiffs have abandoned that 

theory and expressly do not pursue a fraudulent inducement or wrongful 

taking of premiums claim under subsection (1)(a) of Oregon Revised 

Statutes 124.110. Plaintiffs press only a wrongful withholding of money 

or property claim under subsection (1)(b) on the basis of Bankers’ bad 

faith denial and delay of insurance claims.

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BATES V. BANKERS LIFE & CAS. CO. 7

not include claims against insurance companies for benefits. 

Bankers focuses on the language, “acquired in whole or in 

part . . . from the vulnerable person,” to argue that the statute 

does not cover typical sales or services transactions. Or. 

Rev. Stat. § 124.110; see also Hoffart v. Wiggins, 204 P.3d 

173, 175 (Or. Ct. App. 2009). Bankers reasons that the 

vulnerable person is limited to a return of the same money 

or property that the insurer acquired from that vulnerable 

person, as in a bailment or trust scenario. In addition to the 

text of the statute, Bankers relies on the elements of a claim 

for financial abuse set forth in Hoffart v. Wiggins, 204 P.3d 

at 175.

Without guidance from the Oregon Supreme Court or 

any Oregon appellate court, we are not confident of the 

correct interpretation of Oregon’s financial abuse statute. 

While the statute’s legislative history suggests that the 

statute may be applied to contractual relationships, it does 

not shed light on whether the statute’s breadth encompasses 

the wrongful withholding of insurance benefits owed under 

a policy. See Wyers v. Am. Med. Response Nw., Inc., 

377 P.3d 570, 580 (Or. 2016); Abuse of the Elderly and 

Incapacitated: Hearing on S.B. 6 Before the H. Comm. on 

Judiciary, 1999 Leg., 70th Sess., Tape 166, Side A (Or. 

1999) (statement of Rep. Lane Shetterly). Because the 

resolution of this case turns solely on Oregon law, we can 

only predict how the Oregon Supreme Court would rule. See 

Patton v. Target Corp., 580 F.3d 942, 948 (9th Cir. 2009). 

Therefore, we certify this question of law to the Oregon 

Supreme Court so that we, as well as the Oregon bar, might 

benefit from an authoritative decision on this issue. See id.

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8 BATES V. BANKERS LIFE & CAS. CO.

III.

In an opinion published concurrently with this order, we 

resolved a separate question of whether our court has 

jurisdiction to review the district court’s decision to strike 

the class allegations. All other further proceedings in this 

case are stayed pending receipt of the answer to the certified 

question or notification by the Oregon Supreme Court that it 

declines to answer the certified question. The parties shall 

notify this court within ten days after the Oregon Supreme 

Court accepts or rejects certification. In the event that the 

Oregon Supreme Court accepts certification, the parties shall 

file a joint status report with this court six months after the 

date of acceptance and every six months thereafter, or within 

ten days of the Oregon Supreme Court’s decision, whichever 

is earlier.

The Clerk shall file a certified copy of this order with the 

Oregon Supreme Court under Oregon Revised Statutes 

§ 28.215. The Clerk shall also provide a copy of the record 

in this case, in whole or in part, to the Oregon Supreme Court 

upon request.

IT IS SO ORDERED.

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