1 

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

MADIE NIXON, LATOYA 

CONNER, DAVID CONNER, 

PORTRICE VERNON, as mother of 

Ariana Conner, formerly a minor, and 

ARIANA CONNER, 

Plaintiffs, 

 v. 

UNITED STATES OF AMERICA, 

Defendant. 

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No. 12 C 0016 

Judge John J. Tharp 

MEMORANDUM OPINION AND ORDER

This is a negligence action filed against the United States of America (the 

“Government”) by a group of plaintiffs who allege that the Government failed to properly 

maintain and/or forward a form designating the plaintiffs as beneficiaries on a life 

insurance policy, causing them to lose insurance benefits to which they otherwise would 

otherwise have been entitled. The Government moves to dismiss pursuant to Rule 

12(b)(6). For the reasons stated herein, the Court denies the Government’s motion to 

dismiss. 

FACTS1

This litigation concerns the life insurance benefit proceeds from a Federal 

Employees’ Group Life Insurance (“FEGLI”) policy obtained by Robert L. Conner. 

Conner, who was an employee of the United States Small Business Administration 

 

1

 For the purposes of the motion to dismiss, the Court accepts the plaintiffs’ factual 

allegations as true. See Virnich v. Vorwald, 664 F.3d 206, 212 (7th Cir. 2011). 
2 

(“SBA”), died on July 15, 2009. At the time of his death, Conner owned a FEGLI life 

insurance policy in the principal sum of $702,000. 

On December 15, 2000, Conner signed a designation of beneficiary form naming 

his son, Jadonn Harris Conner, as a 40% beneficiary; his nephew, D’Angelo Marzell 

Conner, as a 20% beneficiary; and his daughter, Ariana Portrice Conner, as a 40% 

beneficiary. The plaintiffs allege that on April 27, 2007, Conner completed and signed an 

updated designation of beneficiary form, altering the beneficiaries. The new form named 

his son, Jadonn Harris Conner, as a 21% beneficiary; his nephew, D’Angelo Conner, as a 

10% beneficiary; his daughter, Ariana Portrice Conner, as a 50% beneficiary; his niece, 

Latoya Conner, as an 8% beneficiary; his sister, Madie Nixon, as an 8% beneficiary; and 

his brother, David M. Conner, as a 3% beneficiary. Ariana Portrice Conner, Latoya 

Conner, Madie Nixon, and David M. Conner are the plaintiffs in this lawsuit. 

The plaintiffs further allege that after Conner signed the updated designation of 

beneficiary form, the two SBA employees who witnessed his signature, Maria Ramirez 

and Sheila Bartolomei, or some other SBA employee, took possession of the form. The 

SBA employees failed, however, to send the form to the SBA Office of Human Capital 

Management in Denver, or to any other appropriate office, in order for the form to take 

effect or for the insurer to pay the correct beneficiaries.2

 As a result, the insurance 

 

2

 As will be discussed in detail below, there is some question whether the SBA’s Chicago 

office, or the SBA’s Denver office, was Conner’s “employing office.” The distinction is 

important because, under the FEGLI Act (“FEGLIA”), a beneficiary form is effective 

only if received in the insured’s employing office before his death. If the Chicago office 

was Conner’s employing office, then the updated beneficiary form was effective, and the 

plaintiffs’ claim is that the Government negligently failed to notify the insurer of the 

correct beneficiaries. If the Denver office was Conner’s employing office, however, then 

because there is no allegation that is the form was ever sent to Denver, the updated 
3 

company paid benefits in the amounts listed on the earlier designation form executed in 

2000 (which presumably had been forwarded to the appropriate office). Under that 

distribution, each of the plaintiffs received less than they would have received under the 

updated designation form from 2007; three of the plaintiffs received nothing at all and 

Ariana Conner received a 40 percent distribution rather than the 50 percent distribution to 

which she was entitled under the 2007 beneficiary designation. 

The plaintiffs now bring suit to recover from the Government the difference 

between the amounts that they would have received under the 2007 designation form and 

the amounts they actually received under the 2000 designation form. 

DISCUSSION 

The Government makes three arguments in favor of dismissing the plaintiffs’ 

complaint. First, the Government argues that the plaintiffs’ de facto cause of action is for 

negligent misrepresentation, and that the FTCA does not waive sovereign immunity for 

claims arising out of misrepresentation. Second, the Government argues that the plaintiffs 

allege only economic damages, which are not recoverable in tort under Illinois law. 

Third, the Government argues that it had no duty to maintain the designation of 

beneficiary form, and because it had no duty, the plaintiffs cannot establish negligence. 

The Court rejects each of the Government’s arguments, and finds that the plaintiffs have 

stated a claim for negligence. 

 

beneficiary form was not effective, and the plaintiffs’ claim is that the Government 

negligently failed to take the necessary steps to effect Conner’s change of beneficiaries. 
4 

I. Sovereign Immunity Is Waived. 

A. The FTCA Waives Sovereign Immunity Because Plaintiffs’ Claim is Not for 

“Misrepresentation.” 

The Government, as a sovereign, is immune from suit except as it consents to be 

sued, and the terms of its consent define the federal courts’ jurisdiction to entertain suits 

against it. See United States v. Nordic Vill., Inc., 503 U.S. 30, 34 (1992). The FTCA 

waives the Government’s immunity for: 

“claims against the United States, for money damages, . . . 

for injury or loss or property, or personal injury or death 

caused by the negligent or wrongful act or omission of any 

employee of the Government while acting within the scope 

of his office or employment, under circumstances where 

the United States, if a private person, would be liable to the 

claimant in accordance with the law of the place where the 

act or omission occurred. 

28 U.S.C. § 1346(b)(1). There are exceptions to the Government’s waiver of sovereign 

immunity, however, including an exception for any claim arising out of 

“misrepresentation.” 28 U.S.C. § 2680(h). “The exception applies to both negligent and 

intentional misrepresentations, as well as to both affirmative acts and omissions of 

material fact.” Metropolitan Life Ins. Co. v. Atkins, 225 F.3d 510, 512 (5th Cir. 2000). 

The court must “look to the essential act that spawned the damages,” not to “the manner 

in which a plaintiff chooses to plead her claim,” in order to determine whether the 

misrepresentation exception to the FTCA’s waiver of sovereign immunity bars the claim. 

Id. 

The Government argues that the Plaintiffs’ claim is for the Government’s 

“misrepresentation” concerning Conner’s beneficiary designations. MTD Br. (Dkt. 17) at 

5. Therefore, according to the Government, the plaintiffs’ claim is for negligent 

misrepresentation. But this argument is misdirected. To the extent that there is a 
5 

misrepresentation involved in the facts of this case, it is a misrepresentation made by the 

Government to the insurance company, not to the plaintiffs. If anyone relied on a 

representation as to the proper payee of the insurance proceeds, it was the insurer, not the 

plaintiffs, and the insurer is not a party to this suit. If the insurer had somehow suffered 

damages, it might be able to argue that the Government’s negligent misrepresentation 

caused those damages. But the plaintiffs do not seek redress because of any 

misrepresentation by the government on which they relied; rather, they claim that the 

Government harmed them by failing to send the beneficiary designation form to the 

appropriate office—which is an operational task, not a misrepresentation—causing the 

insurance company to pay the wrong parties. 

In Atkins, the Fifth Circuit examined a virtually identical fact pattern and 

determined that the plaintiffs’ claims were not for negligent misrepresentation, but rather 

for negligent performance of an operational task.

3

 225 F.3d at 512-13 (rejecting 

argument that claim was for “negligent misrepresentation” where Government failed to 

retain employee’s life insurance beneficiary form); see also Redmond v. United States, 

518 F.2d 811, 816 (7th Cir. 1975) (“Where the gravamen of the complaint is the 

negligent performance of operational tasks, rather than misrepresentation, the 

government may not rely upon § 2680(h) to absolve itself of liability.”) (quoting Ingham 

v. Eastern Air Lines, Inc., 373 F.2d 227, 239 (2d Cir. 1967)). The court stated that to 

determine whether a negligence claim arose “out of misrepresentation, we consider 

whether the focal point of the claim is negligence in the communication of (or failure to 

 

3

 Neither party brought Atkins to the Court’s attention. Though it is not binding 

precedent, the Court nonetheless expects counsel for both parties, as a matter of effective 

advocacy, to identify and either apply or distinguish readily available case law from 

federal courts of appeal involving substantially similar facts. 
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communicate) information or negligence in the performance of an operational task, with 

misrepresentation being merely collateral to such performance.” Atkins, 225 F.3d at 512. 

The Atkins court described the claim as “alleging that the United States employee failed 

to preserve and properly file the correct copy” of the designation form, and found that the 

“negligent performance of an operational task allegedly caused the harm.” Id. at 513. As 

in Atkins, the claim here was not one for negligent misrepresentation, but rather for a 

negligent action, and therefore the FTCA waives sovereign immunity. 

A look at the elements necessary to prove negligent misrepresentation further 

confirms that the plaintiffs’ de facto claim is not for negligent misrepresentation. “The 

elements of a negligent misrepresentation claim under Illinois law are: (1) a duty on the 

part of [the defendant] to communicate accurate information; (2) false statements of 

material fact; (3) carelessness or negligence by [the defendant] in ascertaining the truth of 

the statements; (4) intention to induce [the plaintiff] to act; (5) action by [the plaintiff] in 

reliance on the truth of the statements; and (6) damages.” F:A J Kikson v. Underwriters 

Labs., Inc., 492 F.3d 794, 801 (7th Cir. 2007) (internal citation omitted). The plaintiffs do 

not allege that the Government induced them to act or that they acted in reliance on the 

truth of the Government’s “statements.” Rather, they argue that the Government failed to 

maintain the proper form, which had the legal effect of preventing them from being paid 

as beneficiaries to Conner’s life insurance policy. The plaintiffs do not allege 

misrepresentation, and therefore the exception to the FTCA waiver of sovereign 

immunity does not apply. 

B. FEGLIA Also Waives Sovereign Immunity. 

Though the plaintiffs argue only that the FTCA waives the Government’s 

sovereign immunity, FEGLIA also waives sovereign immunity here. The Act states that 
7 

“[t]he district courts of the United States have original jurisdiction . . . of a civil action or 

claim against the United States founded on this chapter.” 5 U.S.C. § 8715. The plaintiffs, 

who claim that the Government breached a legal duty it owed under FEGLIA by failing 

to correctly maintain or forward Conner’s 2007 beneficiary designation form, assert a 

claim founded on FEGLIA and, accordingly, this Court has jurisdiction to hear the claim. 

Although there is an argument to be made that “a general grant of jurisdiction to district 

courts to entertain actions of a certain class . . . is not a waiver of governmental immunity 

from suit or a consent to be sued,” Geurkink Farms, Inc. v. United States, 452 F.2d 643, 

644 (7th Cir. 1971), this jurisdictional grant—specifically authorizing suits arising under 

this statute—does not, in the Court’s view, constitute a “general” jurisdictional grant; it is 

a specific grant of jurisdiction to hear suits arising under FEGLIA, and would be 

meaningless if sovereign immunity could be interposed as a defense to any such suit. 

Accordingly, numerous courts have held that § 8715’s consent to jurisdiction waives the 

Government’s sovereign immunity to claims arising under FEGLIA. See, e.g., Barnes v. 

United States, 307 F.2d 655, 657-58 (D.C. Cir. 1962); Laporte v. United States, No. 09-

7247, 2011 WL 3678872, *4 (S.D.N.Y. Aug. 19, 2011) (citing cases). The Government, 

to be sure, contests the validity of the claim asserted—specifically arguing that it owes no 

duty under FEGLIA—but whether a claim has substantive merit is an entirely separate 

question from whether the Government has waived sovereign immunity with respect to 

that class of claim, and does not affect the jurisdiction of a court to hear the claim. (cf., 

e.g., Morrison v. National Australia Bank Ltd., 130 S. Ct. 2869, 2877 (2010)). Therefore, 

even if the FTCA does not waive the Government’s sovereign immunity, FEGLIA does. 
8 

II. The Plaintiffs Can Recover For Purely Economic Injuries. 

Next, the Government argues that the plaintiffs allege a “purely economic injury,” 

and therefore cannot recover damages in tort. The Government cites to Moorman Mfg. 

Co. v. National Tank Co., 91 Ill.2d 69, 81, 435 N.E.2d 443, 448 (Ill. 1982), which 

announced the economic loss doctrine rejecting the “recovery of solely economic 

loss[es].” Moorman defined “economic loss” as “damages for inadequate value, costs of 

repair and replacement of the defective product, or consequent loss of profits—without 

any claim of personal injury or damage to other property.” Id. at 82 (internal citation 

omitted). 

But the Moorman economic loss doctrine does not apply “[w]here a duty arises 

outside of [a] contract.” Neumann v. Carlson Envtl., Inc., 429 F. Supp. 2d 946, 952 (N.D. 

Ill. 2006) (quoting Congregation of the Passion, Holy Cross Province v. Touche Ross & 

Co., 159 Ill.2d 137, 162, 636 N.E.2d 503, 514 (Ill. 1994)); see also Kanter v. Deitelbaum, 

271 Ill. App. 3d 750, 753-55, 648 N.E.2d 1137, 1139-40 (Ill. App. Ct. 1995) (economic 

loss doctrine does not apply to insurance broker who failed to maintain health insurance 

for client because the broker breached a fiduciary duty, not a contractual duty). Where a 

party has a duty independent of any contractual relationship, the economic loss doctrine 

does not apply. Golf v. Henderson, 376 Ill. App. 3d 271, 279, 876 N.E.2d 105, 113 (Ill. 

App. Ct. 2007) (“The Moorman doctrine, however, does not apply when a duty arises that 

is extracontractual.”); R.J. O’Brien & Assocs., Inc. v. Forman, 298 F.3d 653, 656 (7th 

Cir. 2002) (“Moorman dictates that, when a contract sets out the duties between the 

parties, recovery should be limited to contract damages, even though recovery in tort 

would otherwise be available under the common law.”). The economic loss doctrine is 
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designed to prevent parties from recovering in tort when they could have (or should have) 

recovered in contract. Westfield Ins. Co. v. Birkey’s Farm Store, Inc., 399 Ill. App. 3d 

219, 231, 924 N.E.2d 1231, 1243 (Ill. App. Ct. 2010) (“[T]he economic-loss [doctrine] is 

founded on the theory that parties to a contract may allocate their risks by agreement and 

do not need the special protections of tort law to recover damages caused by a breach of 

contract.”) (internal citation omitted). Even Moorman itself implicitly acknowledged that 

the economic loss rule applies only to situations where a contract creates the duty, stating 

that “[t]he remedy for economic loss . . . lies in contract.” Moorman, 91 Ill.2d at 86, 435 

N.E.2d at 450. 

Here, neither Conner nor the plaintiffs had any contract with the Government at 

all, much less one that required the Government to properly file and preserve Conner’s 

designation of beneficiary form. Therefore, any duty the Government owed Conner or the 

plaintiffs must have arisen from something other than a contract. As explained below, the 

Government’s duty comes from FEGLIA or the common law, rendering the economic 

loss doctrine inapplicable. See Bestfoods v. Gen. Warehouse & Transp. Co., No. 99-8118, 

2000 WL 1310670, *6 (N.D. Ill. Sep. 13, 2000) (an argument “that the Moorman doctrine 

somehow supersedes a statutory duty of care is untenable”); Serfecz v. Jewel Food Stores, 

Inc., No. 92-4171, 1998 WL 142427, *3 (N.D. Ill. Mar. 26, 1998) (the economic loss 

doctrine does not bar claims “for common law waste in Illinois even though the property 

at issue incurred no physical damage”). Therefore, because the plaintiffs have no contract 

remedy, and because the Government’s actions here are not the type that are normally 

subject to contract, the economic loss doctrine does not apply and the Government may 

face tort liability for the plaintiffs’ purely economic damages. 
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III.The Government Had a Duty to Properly Maintain or Forward Conner’s 2007 

Beneficiary Designation Form. 

That neither sovereign immunity nor the economic loss doctrine bars the 

plaintiffs’ claims brings into focus the question of whether the Government owes any 

duty to the plaintiffs and, if so, whether the plaintiffs breached that duty. 

A. The Government’s Duties Related to FEGLI Forms. 

The Government argues that it owes no duty to receive or maintain life insurance 

forms for federal employees. Courts have come to different conclusions regarding 

whether FEGLIA creates duties related to these forms. Compare Atkins, 225 F.3d at 514 

(“the United States, through the personnel clerk, has a duty to maintain the designation of 

beneficiary forms turned over to its care as a part of its responsibilities under FEGLIA”); 

with Frerichs, 2006 WL 200812 at *2 n.3 (“the United States has no duty to properly 

receive, maintain, and review benefit election forms”); Graber, 855 F. Supp. 2d at 677 

(“the only legal duty imposed on the United States under FEGLIA is to ensure that the 

correct FEGLI policy is negotiated and issued”). Agreeing with the case law holding the 

Government responsible for, at the very least, properly maintaining or submitting 

correctly completed forms, the Court finds that the Government had a duty with respect 

to the updated beneficiary form. 

FEGLIA requires that life insurance benefits “shall be paid, on the establishment 

of a valid claim, to the [designated beneficiaries].” 5 U.S.C. § 8705(a). Payment is 

predicated on the Government’s receipt of the designation of beneficiary form before the 

insured’s death. Id. This implies that, following receipt of the form, the Government has a 

duty to properly preserve it in a manner that permits accurate assessment of the 

employee’s designated beneficiaries. The Tenth Circuit, in examining FEGLIA, 
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implicitly assumed that the Government has “the responsibility to perform various 

ministerial acts—like distributing information and forms to employees and collecting 

required forms once employees have reviewed and executed them.” Metropolitan Life 

Ins. Co. v. Bush, 154 F.3d 1149, 1153 (10th Cir. 1998). That conclusion must be correct; 

otherwise, an insured is left in the untenable position of being required by law to submit 

his designation of beneficiary form to an entity (the Government) that has no 

corresponding responsibility to maintain or forward the form. By that reasoning, the 

Government personnel receiving the forms could simply crumple up the forms and throw 

them in the trash upon receipt and the putative insureds, and their beneficiaries, would 

have no recourse. Further, with respect to FEGLI, the Government acts as an agent for its 

employees, see, e.g., Brinson v. Brinson, 334 F.2d 155, 158 (4th Cir. 1964), and that role 

gives rise to certain duties under the common law of agency. Illinois law holds, for 

example, that if a life insurance agent accepts an application for insurance, but fails to 

process it within a reasonable time, the agent is liable for harm caused by his negligence. 

See Bovan v. American Family Life Ins. Co., 386 Ill. App. 3d 933, 940, 897 N.E.2d 288, 

294 (Ill. App. Ct. 2008). That same principle applies to the Government’s alleged failure 

here. 

The Fifth Circuit, addressing facts almost identical to those in this case, held 

expressly that although the Government had no duty to ensure that employees’ properly 

complete their insurance forms, FEGLIA required the Government to properly maintain 

completed forms turned over to its care. Atkins, 225 F.3d at 514. The court also found 

that FEGLIA allowed plaintiffs to recover money damages against the Government, and 

it reversed the district court’s dismissal of the lawsuit. Id. The Court finds Atkins
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persuasive here. It makes no sense to interpret FEGLIA to require the submission of 

beneficiary designation forms to the Government while simultaneously absolving the 

Government of any responsibility for processing and maintaining those forms in the 

manner required by the statute to make them effective. The Court concludes, then, that 

the Government has a duty under FEGLI and the common law to preserve beneficiary 

forms submitted by employees in a manner that permits an assessment of the employee’s 

current beneficiaries at time of death. 

To be sure, other courts have come to the opposite conclusion. In Frerichs, the 

plaintiff alleged that the decedent, a governmental employee, incorrectly filled out a life 

insurance form, mistakenly declining certain life insurance coverage when he intended to 

accept that coverage. 2006 WL 200812, at *1. The decedent contacted the human 

resources department of his former employer, a governmental agency, and asked them to 

correct his form. Id. The agency assured him that it had corrected the form, but when he 

died his beneficiary learned that the agency had not done so. Id. When the putative 

beneficiary sued the Government for breach of contract, the court held that because 

Congress did not clearly indicate in FEGLIA that it intended to waive sovereign 

immunity by creating actionable duties, the Government had no duty to receive or 

maintain the forms. Id. at *2 n. 3. But, again, whether Government had a duty to maintain 

the forms and whether Congress waived sovereign immunity are two distinct questions. 

Frerichs acknowledged that FEGLIA created “legal duties” on the part of the 

Government but concluded that the duties were not “actionable” because FEGLIA did not 

clearly waive sovereign immunity. Id. But even if FEGLIA itself does not waive 

sovereign immunity (contrary to this Court’s conclusion, above), the FTCA plainly does. 
13 

The FTCA did not apply in Frerichs because there the plaintiff alleged only a breach of 

contract, but in this tort case, unlike in Frerichs, the FTCA applies and the Government 

has therefore waived sovereign immunity. 

Further, Frerichs and the cases on which it relied are also readily distinguishable, 

as each involved a situation in which the Government’s alleged breach of duty was a 

failure to take affirmative action to ensure that the putative insured had filled out 

beneficiary designation forms appropriately. Frerichs itself involved an alleged failure by 

the government to correct a form that the insured had filled out incorrectly. Id. at *1. 

Similarly, Argent v. O.P.M, No. 96-2516, 1997 WL 473975, *2 (S.D.N.Y. Aug. 20, 

1997) merely held that the Government has no duty to inspect the beneficiary forms it 

receives to determine whether they are authentic or fraudulent. Frerichs also relies on 

Barnes, 307 F.2d at 658-59, which held that the Government has no duty to extend an 

employee’s life insurance into retirement when the employee fails to fill out the correct 

form or pay premiums, and Robinson v. United States, 8 Cl. Ct. 343, 345 (Cl. Ct. 1985), 

which held that the Government is not liable for an employee’s failure to complete life 

insurance forms even where the Government did not send the employee the forms in a 

timely fashion. Each of these cases is qualitatively different than the case at hand, 

involving claims that the Government failed not merely to maintain or forward 

beneficiary forms submitted by putative insureds, but rather to take affirmative action to 

ensure that the decedents completed the forms in a timely and accurate manner. That the 

Government has no duty to ensure that its employees properly complete the forms does 

not mean that it has no duty to maintain or forward the properly completed forms it has 

accepted. Under the statutory scheme, the employee is responsible for submitting the 
14 

designation form to the Government; if submitted, it is the Government’s concomitant 

responsibility to maintain the form and to transmit it to the insurer. 

So far as the complaint alleges, Conner completely and accurately submitted his 

beneficiary form to the Government, but the Government either lost it or otherwise failed 

to maintain it and to transmit it to the insurer upon Connor’s death. While the Court takes 

no issue with cases holding that the Government has no duty to ensure that each of its 

employees has accurately completed their FEGLI forms, or that the forms are otherwise 

valid when submitted, the Government—as the statutorily designated recipient of the 

forms—must at least maintain the forms that employees submit to it in a manner that 

permits the required identification of current beneficiaries set forth in § 8705. 

B. By Properly Alleging a Governmental Duty, the Plaintiffs State a Claim for 

Negligence. 

Plaintiffs’ allege that the Government breached its duties under FEGLIA by 

failing to forward the updated beneficiary designation form to the SBA’s Office of 

Human Capital Management in Denver. Cmplt. ¶¶ 8-9. Under FEGLIA, a signed and 

witnessed beneficiary designation form is effective if it is “received before [the insured’s] 

death in the employing office.” 5 U.S.C. § 8705(a). Therefore, if the Chicago SBA was 

Conner’s “employing office,” as the plaintiffs argue in their response brief, then the 

updated form became effective when Conner submitted it to SBA employees in Chicago. 

The Code of Federal Regulations unhelpfully defines “employing office” as “the 

agency office or retirement system office that has responsibility for life insurance 

actions.” 5 C.F.R. § 870.101. The Tenth Circuit, finding this regulatory language unclear, 

stated that the employing office might be the office with “responsibility for determining 

the existence and scope of life insurance coverage and the identification of particular 
15 

beneficiaries,” or it might be the office with “the responsibility to perform various 

ministerial acts—like distributing information and forms to employees and collecting 

required forms once employees have reviewed and executed them.” Bush, 154 F.3d at 

1153. Because the regulatory language was unclear, the Bush court found that an 

employee could reasonably interpret it as “directing her to file [the beneficiary form] with 

the personnel officer at the office where she was stationed.” Id. Bush therefore upheld a 

change of beneficiary form that was received at the employee’s place of business before 

her death, but was not forwarded on to the national department of human resources until 

after the employee had died. Id. at 1154; see also Fair v. Moore, 397 A.2d 976, 978 (D.C. 

1979) (“It is, we think, faithful to the use the term ‘employing office’ [to mean] the 

immediate government entity in the employment relationship with the insured.”). 

Likewise, in this case, the term “employing office” is broad enough to encompass 

the office at which Conner worked, and to which he submitted the form. The form need 

not have been submitted to the Denver office to become effective, and the insurer should 

have paid benefits to the plaintiffs pursuant to 5 U.S.C. § 8705(a). The Government’s 

negligent failure to send the updated form to Denver so that it could be forwarded to the 

insurer caused the insurer to pay benefits to the beneficiaries listed on the outdated 2000 

form. Therefore, the Government violated its duty under FEGLIA by preventing the 

properly designated beneficiaries from recovering insurance benefits.4

 

4

 And even if the Denver SBA were deemed to be Conner’s employing office, and the 

form needed to be received in Denver to become effective, then the Government, by 

accepting the updated beneficiary form in Chicago, had a duty under FEGLIA or the 

common law to forward the form to the Denver SBA to make it effective. See Bovan, 386 

Ill. App. 3d at 940, 897 N.E.2d at 294 (explaining common law duties of insurance 

agent). 
16 

The plaintiffs have therefore adequately alleged that the form was effective and 

the Government had a duty to forward it to the appropriate location. They have stated a 

claim that the Government failed to discharge that duty. Because the plaintiffs also allege 

that the Government’s breach caused them damage, and because both the FTCA and 

FEGLIA waive the Government’s sovereign liability, the plaintiffs have stated a claim 

for negligence upon which relief may be granted. 

* * * 

For all of these reasons, the Court denies the Government’s motion to dismiss. 

Date: January 4, 2013 

John J. Tharp, Jr. 

United States District Judge