Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_05-cv-01716/USCOURTS-caed-2_05-cv-01716-10/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1332 Diversity-Interpleader Action

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

UNITED INVESTORS LIFE No. 2:05-cv-01716-MCE-DAD

INSURANCE COMPANY,

Plaintiff,

v. ORDER DENYING MOTION FOR 

NEW TRIAL

DONNA GRANT, individually and

as Administrator of the Estate

of George H. Grant, HELEN

FAUERBACH, JIM GRANT, KENNY

GRANT, BRANDON GRANT, and DOES

1 through 20, inclusive,

Defendants.

______________________________/

DONNA GRANT, individually and 

as Administrator of the Estate 

of George H. Grant,

Cross-Plaintiff,

v.

UNITED INVESTORS LIFE INSURANCE

COMPANY, and DOES 1 through 100,

inclusive,

Cross Defendants.

----oo0oo----

Case 2:05-cv-01716-MCE -DAD Document 292 Filed 09/26/08 Page 1 of 6
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Cross Defendant United Investors Life Insurance Company

(“United Investors”) moves for a new trial, pursuant to Federal

Rule of Civil Procedure 59(a), following the jury’s verdict in

favor of Cross Plaintiff Donna Grant (“Ms. Grant”) on November 5,

2007, and judgment rendered in accordance with that verdict on

November 9, 2007. 

United Investors makes several arguments. It first argues

that the evidence, both with respect to its investigation of

Ms. Grant’s claim and any causal link between the purported

deficiencies of that investigation and Ms. Grant’s alleged

damages, did not support the jury’s conclusion that United

Investors’ delay in filing an interpleader action was a

substantial factor in causing harm to Ms. Grant. Second, United

Investors also argues that Ms. Grant impermissibly changed her

theory of recovery from that previously identified during the

course of discovery and pre-trial preparation. Third, United

Investors claims that the jury instructions as to causation were

inadequate. Finally, United Investors urges the court to either

strike, or reduce as excessive by way of remittitur, the damages

awarded by the jury.

Under Rule 59(a), the Court may grant a new trial if “the

verdict is contrary to the clear weight of the evidence, or is

based upon evidence which is false, or to prevent, in the sound

discretion of the court, a miscarriage of justice.” Silver Sage

Partners, Ltd. v. City of Desert Hot Springs, 251 F.3d 814, 818-

819 (9th Cir. 2001) (citation omitted). This stringent standard

can be met only if “it is quite clear that the jury has reached a

seriously erroneous result.” 

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Digidyne Corp. v. Data General Corp., 734 F.2d 1336, 1347 (9th

Cir. 1984), see also Venegas v. Wagner, 831 F.2d 1514, 1519 (9th

Cir. 1987). It would amount to an abuse of discretion on the

part of the court to grant a new trial on any lesser showing, and

the court should not extend relief simply because it would have

arrived at a different verdict. Silver Sage Partners, LTD v.

City of Desert Hot Springs, 251 F.3d at 818-19.

The Court cannot grant a new trial given these rigorous

requirements. In its view, there was sufficient evidence from

which the jury could have reached its decision finding United

Investors liable for damages claimed by Ms. Grant. Contrary to

United Investors’ claim that the verdict was based on little more

than argument and unsupported speculation, there was evidence

that United Investors delayed in performing the investigation

necessary to determine whether the policy proceeds payable as a

result of George Grant’s death should have been interpled, and

that Ms. Grant as the named beneficiary under that policy

suffered damages as a result. Denise Oliver, who was in charge

of supervising the claim on behalf of United Investors, testified

that claims for which interpleader is necessary are ordinarily

identified and referred to the company’s legal department for

filing within 90 days, far less than the 13 months it took here

for the interpleader process to be commenced. The jury

determined this delay to be unreasonable, and the Court cannot

conclude that its decision in that regard was seriously erroneous

so as to justify a new trial. 

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In addition, the jury heard evidence from which it could

adduce that United Investors’ delay caused Ms. Grant damage. 

Ms. Grant testified that she would not have made certain

financial decisions had she been informed that the process for

adjudicating her entitlement to the insurance proceeds would be

so protracted. She opined that she may have sold the family

business, Vallejo Glass, had she known sooner about United’s

intentions with respect to interpleader. She identified

substantial business losses and personal loans to keep the

business afloat during that period. Ms. Grant’s expert witness,

Richard Carl, totaled Ms. Grant’s business losses at

approximately $266,000.00, and Ms. Grant herself testified that

she had to make personal advances of some $35,000.00 to keep

Vallejo Glass in operation. Ms. Grant further testified that she

would not have bought an $850,000.00 house during the months

following her husband’s death, and incurred some $50,000.00 in

connection with the purchase, had she been informed about any

delay in payment of the life insurance proceeds through

interpleader. The alleged damages from these events alone

substantially exceeds the $265,000.00 in economic damages awarded

by the jury.

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The Court is similarly unpersuaded by United Investors’

other arguments in support of its contention that a new trial is

warranted. The Court properly instructed the jury that, in order

to establish a breach of United Investors’ duty of good faith and

fair dealing in properly investigating her claim, Ms. Grant had

to show not only that United Investors unreasonably failed to

investigate and consequently unreasonably delayed the filing of

its interpleader action, but also that such unreasonable failure

to investigate/delay was a “substantial factor” in causing

Ms. Grant’s alleged harm. The instruction at issue, Jury

Instruction No. 20, is a pattern jury instruction derived from

the Judicial Council of California Civil Jury Instruction

(“CACI”) No. 2332, and correctly instructed the jury as to

causation.

Also unavailing is United Investors’ argument that Ms. Grant

relied on allegations at trial that were not properly disclosed

beforehand. Her addendum to the [Proposed] Final Joint Pretrial

Conference Statement, filed July 23, 2007, provided the following

statement of her testimony, which is consistent to that actually

offered in trial:

“Ms. Grant will testify about her husband’s death and

her efforts to obtain the policy proceeds. She will

testify about how the defendant’s dilatory claims

handling practices and the failure to accurately and

reliably inform her about the status of her claim

affected her business decisions and decisions to buy

and sell property.....

Id. at 3-4.

Finally, the Court rejects the argument that Ms. Grant’s

damage award was excessive given the evidence adduced at trial.

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Based on the foregoing, United Investors’ Motion for a New

Trial is DENIED.

IT IS SO ORDERED.

Dated: September 25, 2008

_____________________________

MORRISON C. ENGLAND, JR.

UNITED STATES DISTRICT JUDGE

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