UNITED STATES CO URT OF APPEALS FOR THE TENTH CIRCUIT

CHRISTINE WILLIAMS, Plaintiff - Appellant,

v. OWNERS INSURANCE COMPANY, Defendant - Appellee. No. 14-1262 (D.C. No. 1:12-CV-00999-MSK-CBS) (D. Colo.)

ORDER AND JUDGMENT *

Before BRISCOE , Chief Judge, LUCERO and MATHESON , Circuit Judges.

Christine Williams appeals the district court’s gran t of summary judgment to Owners Insurance Company (Owners) on her claims for breach of contract and bad faith failure to pay her underinsured motorist (UIM) claim. We affirm.

* After examining the briefs and appella te record, this pa nel has determined unanimously that oral argument would not mate rially assist the de termination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctr ines of law of the case, res judicata, and collateral estoppel. It may be cite d, however, for its persuasi ve value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. FILED United States Court of Appeals Tenth Circuit 

### July 15, 2015
Elisabeth A. Shumaker Clerk of Court- 2 - I. BACKGROUND Ms. Williams was injured in an automobile accident on August 25, 2008. She settled with the at-fault driver’s insura nce company on January 3, 2012, for the policy limit of $25,000. She then sought payment from her own insurance company, Owners, for UIM coverage. Her Owners po licy required her to exhaust her claim against the at-fault driver before seeking payment und er the Owners policy. On January 10, 2012, she demanded the polic y limit of $100,000 from Owners, stating that her unreimbursed medical expenses exceeded $50,000 and her lost income exceeded $60,000. Owners personnel reviewed Ms. Williams’s medical records and noted that her symptoms may have worsened over time; so me injuries were de generative and thus preexisting, rather than tr aumatically caused by the accide nt; and she had been in a subsequent automobile accide nt in October 2009. As to the claimed lost wages, Owners observed that none of Ms. Williams’s medical providers had restricted her from working. In addition, the only doc umentation Ms. Williams initially provided to support her wage-loss cl aim was a spreadsh eet she had prepared herself. Considering the concerns raised by th e documents provided, on February 6, 2012, Owners offered a $50,00 0 settlement and requested additional documentation, which Ms. Williams submitted. Owners increased the se ttlement offer to $75,000 on February 29, 2012. Ms. Williams rejected the offer, but demanded that Owners pay her the $75,000 pending a final settlement. When Owners declined to pay without a- 3 - release of all claims, Ms. Williams filed suit on March 16, 2012. It is undisputed that the parties never reached an agreement as to the amount of UIM benefits to which Ms. Williams was entitled. Ms. Williams brought claims for br each of contract, co mmon law bad faith delay in processing her claim, and statutor y bad faith delay in processing her claim. 1 After noting the law applicable to each claim, the district court determined that all claims had one element in common: whether Owners’ conduct in processing Ms. Williams’s claim was unr easonable. Concluding that Ms. Williams had not produced evidence demonstrating that Own ers had acted unreasonably, the district court granted Owners’ motion for summar y judgment. Ms. Williams appeals, renewing on appeal her substantive claims. She also asserts er ror in the district court’s articulation and application of th e summary judgment standard and in the characterization of her expe rt witness’s testimony.
II. STANDARDS OF REVIEW We apply Colorado law to this in surance dispute based on diversity jurisdiction. Berry & Murphy, P.C. v. Carolina Cas. Ins. Co. , 586 F.3d 803, 808 (10th Cir. 2009). We revi ew the grant of summary judgment de novo, applying the same standards as the district court. Id. We view the facts, and all reasonable inferences supported by those facts, in the light most favorable to Ms. Williams as

1 Ms. Williams filed her complaint in Colorado state court. Owners removed the case to federal court, i nvoking diversity jurisdiction, see 28 U.S.C. § 1332(a).- 4 - the nonmoving party. Id. “The court shall grant summ ary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). An issue is “genuine” if there is sufficient evidence on each side so that a rational trier of fact could resolve the issue either way. An issue of fact is “material” if under the substantive law it is essential to the proper disposition of the claim. If a party that would bear the burden of persuasion at trial does not come forward with sufficient evidence on an essential element of its prima facie ca se, all issues concerning all other elements of the claim and any defenses become immaterial. If there is no genuine issue of material fact, we next determine whether the district cour t correctly applie d the substantive law. The movant bears th e initial burden of making a prima facie demonstration of the absence of a ge nuine issue of ma terial fact and entitlement to judgment as a matter of law. In so doing, a movant that will not bear the burden of persuasi on at trial need not negate the nonmovant’s claim. Such a m ovant may make its prima facie demonstration simply by pointing out to the court a lack of evidence for the nonmovant on an essential elem ent of the nonmovant’s claim. If the movant carries this ini tial burden, the nonmovant that would bear the burden of persuasion at trial may not simply rest upon its pleadings; the burden shifts to the nonmovant to go beyond the pleadings and set forth specific fact s that would be admissible in evidence in the event of trial from wh ich a rational trier of fact could find for the nonmovant. To accomplish this, the facts mu st be identified by reference to affidavits , deposition transcripts, or specific exhibits incorporated therein. Thus, although our review is de novo, we conduct that review from the perspe ctive of the district c ourt at the time it made its ruling, ordinarily limiting our re view to the materials adequately brought to the attention of the district court by the parties. Adler v. Wal-Mart Stores, Inc. , 144 F.3d 664, 67 0-71 (10th Cir. 19 98) (citations and internal quotation marks omitted).- 5 - “Because our review is de novo, we need not separately address [Ms. Williams’s] argument[] th at the district court erre d by viewing evidence in the light most favorable to [Owners] and by treating disputed issues of fact as undisputed.” Simmons v. Sykes Enters., Inc. , 647 F.3d 943, 947 (10th Cir. 2011); see also Knitter v. Corvias Military Living, LLC , 758 F.3d 1214, 1227-28 n.9 (10th Cir. 2014) (“[B]ecause our standard of review is de novo, we are free to apply the proper test here, and we may affirm on any ground supported by the record.”); Salve Regina Coll. v. Russell , 499 U.S. 225, 238 (1991) (“When de novo review is compelled, no form of appellate deference is acceptable.”).
III. DISCUSSION A. Breach of Contract The elements of a cause of action fo r breach of an insurance contract are “(1) the existence of a contra ct, (2) performance by the plai ntiff or some justification for nonperformance, (3) fail ure to perform the contra ct by the defendant, and (4) resulting damages to the plaintiff.” W. Distrib. Co. v. Diodosio , 841 P.2d 1053, 1058 (Colo. 1992) (citations omitted). The insurance c ontract between Ms. Williams and Owners included the followi ng provision: “Whether an injured person is legally entitled to recover damages and the amount of such damages shall be determined by an agreement between the injured person and us.” Aplt. App. at 116. Owners points out that the parties neve r reached an agreement on the amount of damages. Ms. Williams argues that en forcing this provision woul d permit Owners to avoid- 6 - payment merely by refusing to agree. Cons equently, she contends that the clause violates public policy and contravenes Co lo. Rev. Stat. § 10- 3-1115 (prohibiting insurers from unreasonably denying or de laying payment for benefits owed to a first-party claimant). Owners’ enforcement of this provision is not a breach of the contract. The provision is indisputably part of the contract. Ms. Willia ms does not allege that the parties reached an agreement on a settleme nt. Therefore, we consider whether Owners violated public policy or secti on 10-3-1115 by unreasonably handling Ms. Williams’s claim. If the evidence had clearly estab lished that Ms. Williams had $100,000 in UIM exposure, but Owners re fused to pay that amount, we could conclude that the clause is unenfor ceable and Owners’ conduct was unreasonable and/or in bad faith. See Goodson v. Am. Standard Ins. Co. , 89 P.3d 409, 414 (Colo. 2004) (en banc) (“Every contract in Colorado contains an implied duty of good faith and fair deali ng.”). But Owners reasonabl y disputed the amounts of Ms. Williams’s medical expens es and wage losses. Therefore, as we discuss below, no reasonable jury could find that Owners unreasonably declined to pay the policy limit of $100,000.- 7 - B. Common Law and Statutory Bad Faith Ms. Williams claims Owners acted unreasonably and in bad faith as follows: (1) Owners’ investigation was unreasona ble because Owners did not begin to investigate until after January 13, 2012, when it received Ms. Williams’s demand for payment under her UIM coverage, despite be ing informed in 2009 of the probability of a UIM claim; (2) Owners refused to pay her the $75,000 settlement offer as an undisputed minimum, even though a fina l settlement amount had not been reached; (3) Owners’ settlement offers of $50,000 and $7 5,000 were unreas onable, given her documentation to support her claim for $100, 000, and Owners did not explain the bases for the settlement offers; (4) Owners’ agent did not consult a medical professional concerning her que stions about Ms. Williams ’s claimed injuries; and (5) Owners’ record-keep ing was inadequate. (1) Applicable Law For a common law bad faith claim, because this is a “direct or first-party [claim], [the tort of bad faith processing of an insura nce claim] requires proof of unreasonable conduct and knowle dge that the conduct is unreasonable or a reckless disregard of the fact that the conduct is unreasonable.” Travelers Ins. Co. v. Savio , 706 P.2d 1258, 1276 (Colo. 1985) (en banc). “Under Colorado law, it is reasonable for an insurer to chal lenge claims that are ‘fairly debatable.’” Zolman v. Pinnacol
Assurance , 261 P.3d 490, 496 (Colo. Ct. App. 2011).- 8 - Ms. Williams also brings claims un der Colo. Rev. Stat. §10-3-1115(1)(a), which provides: “A person engaged in the business of in surance shall not unreasonably delay or deny paymen t of a claim for benefits owed to or on behalf of any first-party claimant.” Section 10-3-1115(2) im poses an unreasonableness standard “for the purposes of an action br ought pursuant to this section and section 10-3-1116.” Section 1116, in turn, crea tes a private right of action for certain remedies for violations of section 1115, and authorizes damages of two times the covered benefit plus attorney fees and court costs. These statutes “impose on insu rers a . . . standard of lia bility in addition to and different from that required to prove a cl aim for breach of the common law duty of good faith and fair dealing.” Kisselman v. Am. Fam ily Mut. Ins. Co. , 292 P.3d 964, 973 (Colo. Ct. App. 2011). An insurer br eaches the statutory duty if there was “no reasonable basis to delay or de ny the claim for benefits.” Id. at 974 (internal quotation marks omitted); see also section 10-3-1115(2) (stating “an insurer’s delay . . . was unreasonable if the insurer delayed . . . authorizing payment of a covered benefit without a reas onable basis for that action”). In contrast to a common law bad faith claim, “the onl y element at issue in the st atutory claim is whether an insurer denied benefits w ithout a reasonable basis.” Vaccaro v. Am. Family Ins. Group , 2012 COA 9, ¶ 44, 275 P.3d 750, 760; see id. ¶ 44 (stating that a finding that a UIM claim was “fairly debatable” fo r common law purposes “would not alone establish that [the insurer’s ] actions . . . were reasonabl e as a matter of law.”).- 9 - Both the common law and the statutes impose liability if the insurer acted unreasonably. Both types of claim are evaluated objectively, based on industry standards. Savio , 706 P.2d at 1276 (common law claim); Fisher v. State Farm Mut.
Auto. Ins. Co. , 2015 COA 57, ¶ 53, 2015 WL 2198515, at * 9 (statutory claim). Ms. Williams had the burden to establish that Owners acted unreasonably. See Bankr. Estate of Morris v. COPIC Ins. Co. , 192 P.3d 519, 523 (Colo. Ct. App. 2008). The issue of unreasonableness is usually a question of fact, but “in appropriate circumstances, as when there are no genuine issues of ma terial fact, reasonableness may be decided as a matter of law.” Id. at 524. (2) Application We first address Ms. Williams’s clai m that Owners unr easonably delayed investigating her claim. Ms. Williams asserts that Ow ners should have begun its investigation in 2009 upon being informed of the probability of a UIM claim, not in 2012 when it received her demand for paymen t. To carry her burden to show that Owners acted unreasonably in violation of indu stry standards, Ms. Williams relies on excerpts from the deposition of her expert witness, Br adley Levin. Mr. Levin testified that Owners’ reque st for additional documentati on to support the wage loss claim was not unreasonable, but Owner s should have requested additional information from Ms. Williams about her wage loss claim in January, 2012. He did not say Owners should have made the request in 2009. See Sanderson v. Am. Family
Mut. Ins. Co. , 251 P.3d 1213, 1220 (Colo. Ct. A pp. 2010) (holding plaintiff’s UIM- 10 - claims did not accrue until his lawsuit agai nst the underinsured driver was resolved where insurance policy provided for UIM c overage only after liability policies had been exhausted). Mr. Levin did not testify that his opi nion that Owners should have asked for additional documents in January was based on industry standards. Owners received Ms. Williams’s demand p ackage on January 13, 2012. On February 6, Owners requested further docum entation. On February 29, 2012, Owners offered $75,000. Thus, 46 days elap sed between Ms. Williams’s demand and Owners’ offer. We conclude that unde r these circumstances, no reasonable jury could find that Owners unreasonably dela yed investigating Ms. Williams’s UIM claim. We next determine that Owners’ re fusal to pay Ms. Williams the $75,000
settlement offer as an undi sputed minimum does not warrant a finding of bad faith or unreasonable conduct. Indeed, the Colorado Cour t of Appeals has stat ed in dicta that “an assertion that [an insure r] breached its duty under se ction 10-3-1115 by failing to pay [its insured] the initial settlement offer is inconsis tent with Colorado law.” Fisher , 2015 COA 57, ¶ 15 (addressing claim a dvanced at tria l that insurer unreasonably delayed paying insured’s medical expenses, which were owed regardless of set tlement offer). Ms. Williams asserts that Owners’ se ttlement offers of $50,000 and $75,000 were unreasonable, given her documentati on to support her claim for $100,000. But she does not address, or even acknowledge , Owners’ reservations about her medical- 11 - expenses—her symptoms worsened over time, some injuries were degenerative rather than traumatic, and she was in a subseque nt accident. Simila rly, she offers no response to Owners’ challenges to her wage loss claim—the evidence does not contain a doctor’s limitation on her ability to work, she did not proffer admissible evidence that she hired and paid others to perform her work, a nd the spreadsheet she prepared herself was inadequa te to substantiate her lost wages. Rather, she argues merely that she presented “ample eviden ce establishing that Owners disregarded relevant medical opinions,” Aplt. Opening Br. at 37, a nd she “put forward evidence showing that Owners ha[d] no reasonable excu se for failing to perform the contract,” id. at 47. These arguments consisting of me re conclusory allegations are insufficient to warrant appellate review. See Palma-Salazar v. Davis , 677 F.3d 1031, 1037 (10th Cir. 2012) (declining to address concluso ry statements (collecting cases)). Ms. Williams also claims that Owners’ failure to explain its offers of $50,000 and $75,000 showed bad faith. But the correspondence between Owners and Ms. Williams demonstrated that Owners ha d questions about her medical and wage loss claims. Upon receipt of additiona l documentation after making the $50,000 offer, Owners increased its offer to $75,000 . And if Ms. Williams was confused about the basis for the offer, she could have asked, but th ere is no indication that she did. 2

2 Ms. Williams relies on Colo. Rev. Stat. § 10-3-1104( 1)(h)(XIV), which lists as an unfair or deceptive insuran ce practice a failure to promptly explain the basis for a (continued)- 12 - We next address Ms. Williams’s claim that Owners’ agent acted unreasonably and in bad faith by not consulting a medica l professional to resolve her concerns about Ms. Williams’s claim for damages rela ted to medical expe nses. Ms. Williams again relies on her expert witness’s opinion . Mr. Levin opined th at as a layperson, the agent evaluating a claim must have a re asonable basis for rej ecting the claim and may not reject a treating physician’s stat ement without first consulting a medical professional. But Mr. Levi n did not state whether this procedure was an industry standard, a condition imposed by law, or merely his personal opinion of how this claim should have been handled. Moreove r, when asked whet her the Owners agent had the capacity or training to evaluate a medical claim without consulting a medical professional, Mr. Levin replie d, “She may or she may not.” Aplt. App. at 106. Mr. Levin did not explain how Owners’ ev aluation of the claim was deficient. Consequently, this opinion does not demonstr ate that Owners unr easonably or in bad faith challenged Ms. Williams ’s medical claim or that Owners violated industry standards. Last, we consider Ms. Williams’s cl aim that Owners’ record-keeping was inadequate. Mr. Levin stated that industr y standards require an insurer to keep detailed records concerning a claim and that Owners’ internal re cords did not meet this standard. He did not opine, however, th at this failure had any impact on Owners’

settlement offer. Even if it applied to our facts, this s ection does not create a private right of action. Colo. Rev. Stat. § 10-3-1114.- 13 - actions toward Ms. Williams. Thus, Ms . Williams has not shown that Owners’ inadequate record-keeping resulted in any unreasonable actions toward her. C. Expert Witness Testimony Ms. Williams takes issue with the dist rict court’s treatment of her expert witness’s testimony, asserting that the court interpreted and weighed the testimony in the light most favorable to Owners. She argues that once the court received Mr. Levin’s testimony on summary judgment as an expert under Fed. R. Evid. 702, the court should have presumed that hi s opinions espoused i ndustry standards. Ms. Williams has cited no legal authority for this position. The district court carefully reviewed the testimony to dete rmine whether Mr. Levin was, in fact, describing industry standards, which was part of Ms. W illiams’s burden. Based on our de novo review, we perceive no error. IV. CONCLUSION The judgment of the dist rict court is affirmed.

Entered for the Court
Mary Beck Briscoe Chief Judge