United States Court of Appeals

Fifth Circuit

FILED

May 30, 2007

Charles R. Fulbruge III

Clerk

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 06-30449

MICHAEL J. MCLACHLAN; LORI DAVENPORT MCLACHLAN,

Plaintiffs-Appellants,

versus

NEW YORK LIFE INSURANCE COMPANY,

Defendant-Appellee.

--------------------

Appeal from the United States District Court

for the Eastern District of Louisiana

USDC No. 2:05-CV-52

--------------------

Before HIGGINBOTHAM, WIENER, and PRADO, Circuit Judges.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

In applying for increased life insurance coverage, Michael

McLachlan submitted blood and urine samples to his insurer, New

York Life. Although the results indicated elevated levels of two

chemicals, phosphatase and creatinine, New York Life mentioned only

the former in its letter to McLachlan, explaining that it would

issue a policy, but with a higher premium given the elevated

phosphatase. McLachlan was later diagnosed with kidney failure.

McLachlan sued New York Life under general Louisiana negligence

law, complaining of the failure to advise him of the elevated

creatinine. The district court dismissed the case, concluding that
1 Creatinine is a waste by-product expelled by the kidneys. The level

of creatinine in the blood is the simplest measure of kidney function. The

normal amount is 0.5-1.5 mg/dL.

2

New York Life neither owed a duty to disclose nor assumed such a

duty. We affirm.

I

Michael McLachlan had life insurance with New York Life.

After his first child was born in July 2000, McLachlan applied for

increased benefits. As part of the application, New York Life

required him to submit blood and urine samples so that it could

determine the appropriate premium. The samples were forwarded to

a laboratory contracted for by New York Life. That lab reported to

New York Life that McLachlan had high alkaline phosphatase levels

and an “elevated” creatinine level of 2.1 mg/dL.1

New York Life wrote to McLachlan that it had accepted his

application, but at a non-preferred rate due to the high alkaline

phosphatase levels, which increased his risk for several diseases.

McLachlan completed the application process and coverage began. He

told his gastroenterologist of the alkaline phosphatase levels,

which they both began to monitor. His gastroenterologist never

screened for creatinine, a decision the Louisiana Medical Review

Panel later concluded was not professionally inappropriate. New

York Life never informed McLachlan of his elevated creatinine

levels. McLachlan did not request a copy of the test results and

none was sent to him.
3

McLachlan’s creatinine levels continued to rise unchecked,

until a subsequent test in December 2001 found a creatinine level

of 3.4. Doctors told the thirty-four year old McLachlan that the

increasingly elevated creatinine indicated irreversible kidney

damage, necessitating a transplant. In pursuing a malpractice

claim against his doctors, McLachlan subpoenaed the 2000 test

results from New York Life in 2004 and discovered the early

indication of the problem. 

McLachlan and his wife sued New York Life in a Louisiana

federal district court with diversity jurisdiction over their

Louisiana law negligence claim. The claim is that the kidney

damage could have been prevented had New York Life disclosed the

test results when it issued the policy, and that New York Life

either had a duty to disclose initially the test results for

creatinine or assumed such a duty when it disclosed only his

alkaline phosphatase levels. New York Life filed a motion to

dismiss under Federal Rule of Civil Procedure 12(b)(6) and motion

for judgment on the pleading under Rule 12(c), contending that New

York Life owed no relevant duty here, even given the facts of the

McLachlans’ complaint. The district court granted the motion to

dismiss. 

The McLachlans appeal. We review the district court’s ruling

de novo, taking all facts alleged in the complaint as true and

affirming “only if it appears that no relief could be granted under
2 See Abraham v. Singh, 480 F.3d 351, 354 (5th Cir. 2007) (internal

citation and quotation marks omitted).

3 The McLachlans briefly assert that, under Louisiana law, a categorical

“no duty” defense is strongly disfavored; rather, courts generally assume some

sort of duty and, if no liability should attach, find no breach. See Pitre v.

La. Tech. Univ., 673 So. 2d 585, 597 (La. 1996) (Lemmon, J., concurring). 

This is at odds with the Louisiana cases holding that the duty inquiry

requires analysis of whether the duty extends to a particular risk of harm. 

See infra note 5. In any event, even if this case were better analyzed as a

“no breach” case, the McLachlans themselves argue nothing but duty after

citing Pitre. So this case is a “duty” case.

4 The only provision touching this issue, the provision stating that

“[e]very insurer who requires from an applicant for insurance a written

authorization to obtain medical records of the applicant shall furnish copies

of the medical records received by the insurer to the applicant on written

request,” LA. REV. STAT. ANN. § 22:2(A)(1) (2004), is irrelevant here because

New York Life never sought McLachlans’s medical records and McLachlan never

requested such records in writing. Relatedly, other provisions explicitly

regulate all facets of insurers’ HIV testing, LA. REV. STAT. ANN. 40:1300.11

(2004), and none require disclosure of HIV test results without a written

request. 

4

any set of facts that could be proven consistent with the

allegations.”2

II

This appeal turns on whether New York Life owed a relevant

duty to the McLachlans.3 We note first that the McLachlans do not

rely on Louisiana insurance law. And they cannot, because it

creates no duty to disclose in the current situation.4 Rather, the

McLachlans rely on general Louisiana negligence law, codified in

LA. CIV. CODE arts. 2315 and 2316. 

Under Louisiana law, the existence of a duty, and the

corollary issue whether the duty extends to protect a particular

plaintiff from a particular harm, are questions of law usually
5 See Hill v. Lundin & Assocs., 256 So. 2d 620, 623 (La. 1972); Ellison

v. Conoco, Inc., 950 F.2d 1196, 1204-05 (5th Cir. 1996) (construing Louisiana

law). 

6 See Meany v. Meany, 639 So. 2d 229, 233 (La. 1994). Citing Posecai v.

Wal-Mart Stores, Inc., 752 So.2d 762, 766 (La. 1999) (deciding whether Sam’s

Club had duty to protect shopper who was carjacked in store parking lot), the

McLachlans argue that foreseeability and gravity of harm are additional, and

the most important, factors. Posecai, however, by its own terms analyzed when

businesses have a duty to protect their customers from criminal acts of third

parties. The Meany factors control here. 

5

determined together, case-by-case.5 In answering these questions,

Louisiana jurisprudence looks to moral, social, and economic

factors, including: 1) whether the imposition of a duty would

result in an unmanageable flow of litigation; 2) the ease of

association between the plaintiff’s harm and defendant’s conduct;

3) the economic impact on society and similarly situated parties;

4) the nature of the defendant’s activity; 5) moral considerations,

particularly victim fault; 6) precedent; and 7) the direction in

which society and its institutions are evolving.6

The McLachlans make two claims here: that New York Life had an

affirmative duty to disclose the creatinine information because it

was important, and that it assumed a duty to disclose that

information when it disclosed the alkaline phosphatase information.

We address each in turn.

A 

Although there is no recognized affirmative duty to disclose

in the exact situation presented here, Louisiana provides a general

negligent misrepresentation cause of action where there is a legal

duty to provide correct information and the defendant fails to
7 See Barrie v. V.P. Exterminators, Inc., 625 So. 2d 1007, 1016 (La.

1993).

8 See Daye v. General Motors Corp., 720 So. 2d 654, 659 (La. 1998).

9 See, e.g., Nat’l Union Fire Ins. Co. v. Cagle, 68 F.3d 905, 910 (5th

Cir. 1995).

10 The McLachlans and New York Life had privity regarding the existing

life insurance policy, but they did not have privity regarding the

anticipated, future policy because an application for increased coverage is a

proposed new contract, not an extension of an old contract. That the contract

was eventually entered into does not change anything.

11 625 So. 2d at 1016-18.

12 92 F.3d 274 (5th Cir. 1996).

6

disclose or discloses misinformation.7 However, in such cases a

legal duty to disclose exists only where there was privity of

contract or a fiduciary relationship between the parties.8 Under

Louisiana law, the insurer-insured relationship doesn’t give rise

to a fiduciary duty9 and there was no privity of contract between

the McLachlans and New York Life.10 In one case, Barrie v. V.P.

Exterminators, Inc.,

11 the Louisiana Supreme Court imposed a duty

where there was no privity or fiduciary relationship. However, in

Barrie a termite inspector made a faulty report for a seller of a

home, and the buyers, intended users of the report, sued. Here, by

contrast, New York Life purchased the medical tests for its own

purposes, not the McLachlans’.

Our conclusion accords with a similar Erie-guess made by this

court in Deramus v. Jackson National Life Insurance Company.12 In

Deramus, the insurance company rejected Deramus’s life insurance

application after its required blood test found that Deramus had
13 See, e.g., Eaton v. Continental Gen. Ins. Co., 147 F. Supp. 2d 829,

834 (N.D. Ohio 2001); Doe v. Prudential Ins. Co., 860 F. Supp. 243, 252-53

(D.Md. 1993); Petrosky v. Brasner, 279 A.2d 75, 78 (N.Y. App. Div. 2001);

Nolan v. First Colony Life Ins. Co., 784 A.2d 81, 85-86 (N.J. Super. 2001).

14 The McLachlans’ attempts to distinguish Deramus are unconvincing. 

They argue that Deramus had no privity with his insurer, but McLachlan didn’t

either. See supra note 9. They argue that Deramus was told he was rejected

only “for medical reasons,” which should’ve put him on notice of a problem,

whereas here Mr. McLachlan was told about the phosphatase, but not the

creatinine, but, as we explain later, that partial disclosure didn’t create a

duty to disclose more. And they argue that Deramus was already stricken with

AIDS, raising serious issues of causation, whereas here Mr. McLachlan could’ve

saved his kidneys with sufficient warning, but that goes to causation, not

duty.

7

HIV. The insurer told him that it had rejected his claim for

medical reasons, but nothing more; Deramus tried to learn more, but

he could not. After Deramus died of AIDS three years later, his

wife sued. The district court, in concluding that the insurer had

no duty to disclose under Mississippi law, considered many of the

factors that Louisiana courts consider. It observed that insurers

mitigate risk, not protect life, and that their testing is only for

their own purposes. In light of that, and the fact that the

insurer didn’t promise to warn Deramus of any medical risks, the

court concluded that Deramus shouldn’t have expected the insurer to

warn him. The court also noted that the insurer didn’t set the

disease in motion. Turning to the economic and social consequences

of its holding, the court observed that holding insurers to the

same standards of disclosure as doctors would require an expertise

that insurers do not have. Finally, the court noted that the

overwhelming majority of courts to have considered this duty have

rejected it.13 The same reasoning applies here.14
15 Cf. Hannah E. Greenwalk, What You Don’t Know Could Save Your Life: A

Case for Federal Insurance Disclosure Regulation, 102 DICK. L. REV. 131 (1997)

(arguing for Congress to impose a duty by statute); but see Ronald Pelmese,

Jr., Recent Developments in New York Law: Holding that an Insurance Company

Had No Duty to Disclose a Life-Threatening Medical Condition Highlights the

Need for a New Approach, 76 ST. JOHN’S L. REV. 1047 (2002) (arguing that courts

should impose a duty).

16 See 397 F.3d 897 (10th Cir. 2005).

8

The McLachlans urge that insurers like New York Life routinely

run medical tests for the explicit purpose of discovering abnormal

results, and it would be cheap and easy to either forward the

complete results to applicants or simply notify applicants of

anything labeled “elevated” or “out of the ordinary,” perhaps in

the same letters the insurers send with the finalized premium, and

that the risk of harm is great because applicants may not otherwise

discover serious ailments. We aren’t so sure. It’s difficult to

foresee the practical impacts of imposing a duty here - what

insurers would have to test for or would have to disclose. The

risk that applicants may not otherwise discover serious ailments is

not a risk created or borne by the insurer.15

We recognize that a recent Tenth Circuit opinion, Pehle v.

Farm Bureau Life Insurance Company,

16 suggests a contrary

conclusion. In Pehle, the insurer failed to inform Pehle of his

HIV-positive status in its letter rejecting coverage “based on

blood results” and advising Pehle that it would disclose the

results “if he so wished.” The court, applying Wyoming law, held

that the insurer had a “duty to disclose to the applicant
9

information sufficient to cause a reasonable applicant to inquire

further.” The court stated:

By encouraging the Pehles to purchase life insurance

through them, Farm Bureau purported to act with the

Pehles’ best interests in mind. In submitting to a

procedure for extraction and consenting to an examination

of their blood, the Pehles demonstrated that Farm Bureau

had gained their confidence. We do not think that

insurance companies must exist to treat or diagnose HIV

in order for a duty to arise that necessitates that

applicants be properly put on notice to inquire

further....We must inquire who is in ‘the best position

to guard against...injury.’

Although the panel was divided, it is sufficient here to note that

the court reached its decision largely after characterizing the

relationship between the insurer and the applicant as one of trust

and confidence, a position rejected by Louisiana and in any event

not sustainable on the facts here. Given Louisiana law, we cannot

follow Pehle here.

Finally, the McLachlans make a related argument that

“negligent misrepresentation” actually encompasses two theories:

negligent misrepresentation causing pecuniary harm, governed by

RESTATEMENT (SECOND) OF TORTS § 552 and requiring that the statements

were made in the course of business or employment, and negligent

misrepresentation causing physical harm, governed by RESTATEMENT

(SECOND) OF TORTS § 311 and, as comment (c) to that section

recognizes, covering even gratuitous statements not made in the

course of business or for the speaker’s benefit, that is,
17 Section 311 references § 552, stating that § 311 is “somewhat

broader.” Of course, § 311 still requires that the plaintiff have made

“reasonable reliance” on the statement, a requirement that probably will, in

most circumstances, imply some sort of relationship between the parties, but

there is no express requirement of a business relationship.

18 367 So. 2d 836, 839 (La. 1979).

19 They also cite Daye v. General Motors Corp., 720 So.2d 654 (La.

1998), but that case seems to require privity or a fiduciary relationship for

all negligent misrepresentation claims, although the court doesn’t address the

“two theories” possibility.

10

statements made by anyone.17 The McLachlans argue that the district

court missed the distinction, analyzing only the first theory and

citing cases, which required privity or a fiduciary relationship,

relevant only to the first theory. Although “Louisiana

jurisprudence has not thoroughly developed” the latter cause of

action, they assert, Louisiana courts have suggested it exists: in

Devore v. Hobart Manufacturing Company,

18 the Louisiana Supreme

Court highlighted the exact distinction at issue and cited both

Restatement provisions in holding that its case was a pecuniary

loss case governed by § 552.19

Devore only alluded to the possibility of a § 311 claim. More

importantly, § 311 - like § 552 - by its own terms requires an

affirmative misstatement, not just a non-disclosure. That is, §

311 declares that when someone makes a statement that might

otherwise cause physical harm, as when someone having a business

relationship with the plaintiff makes a statement that might

otherwise cause pecuniary harm under § 522, he must be truthful.

Section § 311 does not impose an affirmative duty to warn everyone

of the risk of physical harm. Although Louisiana has extended the
20 See supra note 7 and accompanying text.

21 See Dornak v. Lafayette Gen. Hosp., 399 So. 2d 168, 170-171 (La.

1981); see also Ratliff v. State, 844 So. 2d 926 (La. App. 2003) (holding that

state had assumed duty to ensure that bridge was properly maintained by

sending out inspectors to inspect bridge); Creel v. Southern Natural Gas Co.,

917 So. 2d 491, 499-500 (La. App. 1995) (holding that in maintaining strip of

land and discussing location of right of way with landowner, gas company

assumed duty not to mislead landowner as to location of right of way). 

Although most cases involve an assumed duty other than a duty to disclose,

Dornak makes clear that one can assume a duty to disclose. 

11

“negligent misrepresentation” theory to include situations of nondisclosure, it has done so - implicitly under and as an extension

to § 552 - where there was some sort of business relationship

making it reasonable to imply an affirmative duty.20 Which is why

the relevant cases required privity or a fiduciary relationship.

We are unwilling to create an affirmative duty to disclose under §

311, a duty that would require everyone to warn everyone else of

various physical dangers, regardless of the relationship. 

B

The McLachlans assert that New York Life assumed a duty to

disclose the elevated creatinine when it elected to disclos the

elevated alkaline phosphatase. Under Louisiana law, a party

assumes a duty to disclose if it makes a statement which a

reasonable person would think is a complete, accurate statement as

to certain matters.21 Here, New York Life disclosed the high

alkaline phosphatase levels only to explain to McLachlan why his

premium would be high, not for his well-being, and it made no

representations about the comprehensiveness of its tests or the

intent behind them. As the lower court stated, “McLachlan could
22 399 So. 2d 168 (La. 1981).

12

not have reasonably understood New York Life’s communication to

indicate either that he had a clean bill of health apart from what

was reported or that New York Life would undertake to protect him

from future maladies.” A reasonable person would have thought that

New York Life did the tests only for its benefit and reported only

what it thought actuarially relevant, not medically relevant.

Moreover, as the district court noted, if McLachlan “held any

misconceptions about the purposes of the blood work at the time his

blood was drawn, receiving notice of an increased premium ought to

have corrected them.” 

As they did below, the McLachlans rely primarily on Dornak v.

Lafayette General Hospital.

22 In Dornak, a hospital’s examination

of Dornak for the purpose of determining her fitness for employment

revealed tuberculosis. The hospital later hired Dornak, without

disclosing to her the test results. The Louisiana Supreme Court

found that by undertaking the exam and employing her, the hospital

assumed a duty to disclose the results. The district court here

stated:

Dornak is distinguishable from the context presented

here. The Dornak plaintiff could reasonably expect that

the hospital had voluntarily undertaken to render

services to protect plaintiff’s health because ‘she was

employed by the hospital to perform duties placing her in

contact with co-employees and hospital patients.’

[citing Dornak]. The hospital’s examination in Dornak,

unlike New York Life’s tests, was performed because it

had a special interest in certifying Dornak’s suitability

to work with patients. When the hospital hired her,
23 See Thomas v. Kenton, 425 So. 2d 396 (La. App. 1982).

24 711 So. 2d 765 (La. App. 1998).

13

Dornak quite reasonably understood that she was in fact

healthy in the opinion of the examining doctor.

Furthermore, a doctor examined Dornak; New York Life

merely sent Mr. McLachlan’s blood sample to a lab.

Individuals have a right to expect a certain degree of

care and disclosure when a doctor is directly involved.

[citing Deramus’s distinction of Dornak].

We agree. Put in simpler terms, most employers don’t check their

prospective employees’ health, so when they do, there is an

argument that the employees might rely on the employer’s tests and

representations. Indeed, a Louisiana appellate court has

subsequently held that Dornak limited itself to pre-employment

physical exams.23 In the end, the present case is more like Gilbert

v. B.D.O.W.S., Inc.,

24 where a Louisiana appellate court held that

an insurer’s inspection of a swimming pool to determine if it met

underwriting requirements did not mean the insurer had assumed a

duty to inform the pool owner of the pool’s safety.

IV

Finally, the McLachlans claim that the district court made two

findings of fact improper on a motion to dismiss. First, that New

York Life disclosed the phosphatase and didn’t disclose the

creatinine because only the former was relevant to its

underwriting, when possibly the creatinine should have had

underwriting significance under New York Life policy but didn’t or

that it had underwriting significance but wasn’t disclosed,
14

intentionally or by mistake. This, it is argued, is suggested by

the fact that New York Life ordered a creatinine test in the first

place. Second, that McLachlan could not reasonably have understood

the partial disclosure to be a full disclosure. New York Life

responds that the McLachlans in their own complaint averred the

first fact, and that the second “fact” is a conclusion of law. The

first fact, even if true, wouldn’t create a duty. And the second

“fact” is a conclusion of law.

V

The district court’s ruling is AFFIRMED. We do not find the

applicable Louisiana law to be uncertain and DENY the McLachlans’

motion to certify questions to the Louisiana Supreme Court.