UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

METLIFE INVESTORS USA INSURANCE 

COMPANY, 

Plaintiff, 

v. CAUSE NO.: 2:16-CV-97-TLS 

ESTATE OF MELINDA LINDSEY and 

JULIE KIRBY, in her capacity as Personal 

Representative of the Probate Estate of 

Melinda Lindsey, 

Defendants. 

 

ESTATE OF MELINDA LINDSEY and 

JULIE KIRBY, in her capacity as Personal 

Representative of the Probate Estate of 

Melinda Lindsey, 

Counter-Plaintiffs, 

v. 

METLIFE INVESTORS USA INSURANCE 

COMPANY, 

Counter-Defendant. 

 

OPINION AND ORDER 

This matter is before the Court on a Motion for Summary Judgment [ECF No. 87], filed 

by Plaintiff/Counter-Defendant MetLife Investors USA Insurance Company (“MetLife”), a 

Motion to Strike the Affidavit of John F. Fitzgerald [ECF No. 100] filed by MetLife, and a 

Motion to Strike MetLife’s Supplemental Designation of Evidence and Corresponding Portions 

of Reply Brief [ECF No. 103], filed by Defendants/Counter-Plaintiffs Estate of Melinda Lindsey 

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and Julie Kirby in her capacity as Personal Representative of the Probate Estate of Melinda 

Lindsey (collectively, the “Estate”). The motions are fully briefed and ripe for ruling. For the 

reasons detailed below, the Court denies MetLife’s motion for summary judgment and denies as 

moot the motions to strike. All claims remain pending for trial. 

SUMMARY JUDGMENT STANDARD 

 Summary judgment is warranted when “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). When the movant seeks summary judgment on a claim on which it bears the 

burden of proof at trial, the movant “must lay out the elements of the claim, cite the facts which 

it believes satisfies these elements, and demonstrate why the record is so one-sided as to rule out 

the prospect of a finding in favor of the non-movant on the claim.” Hotel 71 Mezz Lender LLC v. 

Nat’l Ret. Fund, 778 F.3d 593, 601 (7th Cir. 2015); see also Reserve Supply Corp. v. OwensCorning Fiberglas Corp., 971 F.2d 37, 42 (7th Cir. 1992) (“[B]ecause Owens-Corning and 

CertainTeed . . . have the burden at trial of establishing good faith, they must establish 

affirmatively the lack of ‘sufficient evidence favoring the nonmoving party for a jury to return a 

verdict for that party.’” (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249–50 (1986))). 

“If the movant has failed to make this initial showing, the court is obligated to deny the motion.” 

Hotel 71 Mezz Lender LLC, 778 F.3d at 601. 

 When the movant seeks summary judgment on a claim for which the non-movant bears 

the burden of proof at trial, the movant may demonstrate that it is entitled to judgment as a 

matter of law by “either: (1) showing that there is an absence of evidence supporting an essential 

element of the non-moving party’s claim; or (2) presenting affirmative evidence that negates an 

essential element of the non-moving party’s claim.” Hummel v. St. Joseph Cnty. Bd. of Comm’rs, 

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817 F.3d 1010, 1015–16 (7th Cir. 2016) (citation omitted). In response, the non-movant “must 

make a sufficient showing on every element of his case on which he bears the burden of proof; if 

he fails to do so, there is no issue for trial.” Yeatts v. Zimmer Biomet Holdings, Inc., 940 F.3d 

354, 358 (7th Cir. 2019) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). 

 In ruling on a motion for summary judgment, a court must construe all facts and draw all 

reasonable inferences in the light most favorable to the nonmoving party. Id. (citation omitted). 

A court’s role “is not to sift through the evidence, pondering the nuances and inconsistencies, 

and decide whom to believe. The court has one task and one task only: to decide, based on the 

evidence of record, whether there is any material dispute of fact that requires a trial.” Waldridge 

v. Am. Hoechst Corp., 24 F.3d 918, 920 (7th Cir. 1994) (citations omitted). Facts that are 

outcome determinative under the applicable law are material for summary judgment purposes. 

Anderson, 477 U.S. at 248. 

FACTUAL BACKGROUND 

On October 17, 2013, Steven Lindsey spoke by telephone with David Ambler, a licensed 

insurance agent with MetLife. Estate Ex. D, pp. 2–3, ECF No. 97-2. Steven explained: 

I’m looking to get my life insurance policy renewed. I had one with you guys there 

for a long time and then I got divorced. And then my ex-wife got the balance of the 

term life today and the other one just got canceled and I’d like to at least get the 

short-term one going again until I can get my mind wrapped around so I can start 

the term life insurance policy. And also I had questions about getting my current 

fiancée on life insurance. We have a child together and I think it would be a better 

idea to help her (inaudible). 

Id. at 4:10–21. Steven stated that he believed he previously had a million-dollar policy for 

himself, and Mr. Ambler quoted Steven the premium for a million-dollar, 10-year term policy for 

himself as well as for his fiancée, Melinda. Id. at 5:13, 14:7–12, 18:5–7. 

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On January 2, 2014, Melinda, then Steve’s wife, completed an application over the 

telephone with Mr. Ambler for a term life insurance policy and an accidental death benefit rider 

with MetLife (“Application”). MetLife Ex. 1 ¶ 5 (Fluharty Aff.), ECF No. 88-1; MetLife Ex. 1-

B, ECF No. 88-3; Estate Ex. I, ECF No. 97-3. During the call, Melinda confirmed that she was 

financially dependent on Steven. Estate Ex. I 12:21, 30:7–9. Mr. Ambler asked, “And do you 

know how much life insurance Steven has now?” Id. at 30:10–11. Melinda responded, “[T]wo 

million.” Id. at 30:12. The written Application contained the answers that Melinda is a 

“homemaker” and “mother,” that she was financially dependent on her spouse, Steven, that 

Steven’s earned annual income was $180,000, and that Steven had insurance in the amount of 

$2,000,000. MetLife Ex. 1-B at 1, 3. Steven is listed as the primary beneficiary on the 

Application. Id. at 2. Melinda also answered questions about her medical history in the Medical 

Supplement portion of the Application. Id. at 9–13. Melinda electronically signed the 

Application, agreeing that, among other things, she “read this application for life insurance 

including any amendments and supplements” and “to the best of my knowledge and belief, all 

statements are true and complete.” Id. at 6, 7. 

 On January 31, 2014, Steven contacted MetLife by telephone and spoke with MetLife 

representative Ashley. Estate Ex. F, ECF No. 97-2. Ashley confirmed that, although Steven had 

previously spoken with Mr. Ambler, her office was now handling the Application while it was in 

underwriting. Id. 4:8–15. Steven asked, 

[D]o you know what - - is there like an estimated ETA on when I’ll know? Because 

I was gonna do mine as well, get my policy going, but I’m actually in the middle 

of changing jobs and so I wanted to wait until I got into my new position because 

they offer life insurance too and I wanted to see what it is that they offer. 

Id. at 5:2–8. Ashley indicated that the average review time is four to eight weeks. Id. at 5:19–21. 

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 On March 26, 2014, MetLife issued policy number MLT140D065 to Melinda with a 

benefit amount of $1,000,000 (“Policy”). MetLife Ex. 1-A, p. 3, ECF No. 88-2. In the General 

Provisions section, the Policy contains an “Incontestability” clause that provides: “We cannot 

contest the coverage after the Policy has been in force during the lifetime of the Insured for two 

years from its Issue Date. This provision will not apply to any rider that contains its own 

incontestability clause.” Id. at 9. An Accidental Death Benefit Rider in the amount of $100,000 

was also issued on March 26, 2014, with an incontestability clause that provides: “This Rider 

will not be contestable after it has been in force during the lifetime of the Insured for two years 

from the Issue Date of this Rider.” Id. at 3, 19. 

 On January 16, 2015, within the contestability period, Melinda was shot and killed. See 

MetLife Ex. 1, ¶ 13; MetLife Ex. 1-C (Death Certificate), ECF No. 88-4. On February 12, 2015, 

Steven was arrested and charged with Melinda’s murder. Estate SJ Ex. E, ECF No. 42-2. 

 MetLife conducted a contestability period investigation to verify the information 

provided in the Application, including, as relevant here, the statement that Steven had an 

insurance policy. See MetLife Ex. 1, ¶ 13; MetLife Ex. 2, ¶¶ 4, 7 (Mirabelli Aff.), ECF No. 88-7. 

The investigator, Gregory Mirabelli, states in his affidavit, “My normal course of investigation 

would be to interview Steven Lindsey, who was named as the beneficiary on the policy, in order 

to verify that information, but when I began my investigation I learned that Steven Lindsey was 

incarcerated and was not available to be interviewed.” MetLife Ex. 2, ¶ 9. Mr. Mirabelli did not 

make an effort to speak with Steven. Estate Ex. C 11:16–12:13 (Mirabelli Dep.), ECF No. 97-2. 

Mr. Mirabelli interviewed Melinda’s parents, but they were unable to provide information about 

any insurance for Steven. MetLife Ex. 2, ¶ 10. 

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 As part of the investigation, Mr. Mirabelli checked MetLife’s records and did not find 

any life insurance policy for Steven with MetLife that was in effect at the time of Melinda’s 

Application. Id. at ¶ 11. 

 Mr. Mirabelli also made inquiries with fifteen life insurers or reinsurers. Id. at ¶ 12; 

Estate Ex. C-3, ECF No. 97-2. The inquiries were made of industry contacts that Mr. Mirabelli 

had developed over the years through his investigative work. Estate Ex. C 16:21–17:9. Those 

fifteen contacts do not reflect all life insurance carriers or reinsurance carriers that provide life 

insurance. Id. at 17:10–15. For example, Mr. Mirabelli did not contact Allstate Insurance 

Company, American Family Insurance, AIG, American Fidelity Insurance, Farmers Insurance 

Group, Guardian Life Insurance, Lincoln National, or Mutual of Omaha, all of whom Mr. 

Mirabelli believes provide life insurance policies. Id. at 22:12–25:15. 

 The fifteen inquiries were made by email over a few days in March 2015; two of the 

providers did not respond. Id. at 17:25–18:25,19:8–17; see also Estate Ex. C-3. The emails 

identified Steven and Melinda and asked: “Can you please check for any coverage on these 

individuals?” Id. at 19:24–20:7. Mr. Mirabelli’s email inquiries did not specifically ask whether 

Steven had coverage on January 2, 2014. Id. at 20:8–13, 21:9–15. In his affidavit, Mr. Mirabelli 

states that the responses indicated “that they had searched their databases and could not locate 

any policy insuring [Steven’s] life.” MetLife Ex. 2, ¶ 12. At his deposition, Mr. Mirabelli agreed 

that there could have been prior insurance coverage even though an email response that there 

was no coverage in March 2015 could also be accurate. Estate Ex. C 21:21–22:11. 

 During the investigation, Mr. Mirabelli learned from Melinda’s father that Steven worked 

as a lineman for a power company. Id. at 27:12–19. MetLife received a verification of 

employment from Exelon Corporation (“Exelon”) showing that Steven worked there from 

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January 5, 2009, to January 27, 2014. Estate Ex. A, ECF No. 97-2. After MetLife received the 

verification of employment, Mr. Mirabelli did not contact Exelon. See Estate Ex. C 33:11–17, 

36:2–4. At the time of Melinda’s Application on January 2, 2014, Exelon offered its full-time 

employees life insurance and accidental death insurance. See Estate Ex. B, ECF No. 97-2. 

 As part of the investigation, Mr. Mirabelli obtained copies of Melinda’s medical records 

to verify the information on the Application. MetLife Ex. 2, ¶ 6. 

 Mr. Mirabelli turned over the results of his investigation to the Life Claims Department. 

Id. at ¶ 14. As a result of the investigation, MetLife determined that Melinda “misrepresented 

that her spouse had a two million dollar life insurance policy in effect at the time of her 

application for the policy.” MetLife Ex. 1, ¶ 14. MetLife also determined that Melinda made a 

misrepresentation regarding her medical history. Id. at ¶ 15. MetLife considered both to be 

material misrepresentations. Id. at ¶¶ 14, 15. In his March 19, 2018 affidavit, Lee Fluharty, 

MetLife’s Assistant Vice-President for the Life Insurance Underwriting Department, confirmed 

the decision that both misrepresentations were material to MetLife’s acceptance of the risk in 

issuing the Policy. Id. at ¶¶ 17, 18. Mr. Fluharty agrees with the decision that, had the statements 

in the Application been answered correctly and had not been misrepresentations, MetLife would 

not have issued the Policy. Id. at ¶ 19. 

 MetLife’s underwriting guidelines in effect at the time of the Application “provide that 

when an applicant for a life insurance policy is financially dependent on another person, the 

other person must have at least an equal amount of insurance in order to obtain coverage in a 

face amount greater than $125,000.” Id. at ¶ 21; see also MetLife Ex. 1-E, ECF No. 88-6. Mr. 

Fluharty states in his affidavit that, “had [MetLife] known at the time [Melinda] completed the 

Application that her spouse, Steven Lindsey, did not have a life insurance policy with a face 

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amount of coverage at least equal to the face amount of the policy applied for by Melinda 

Lindsey, it would not have issued the Policy.” MetLife Ex. 1, ¶ 22. 

 On June 25, 2015, MetLife sent correspondence to Steven communicating that there were 

material misrepresentations in the Application regarding his life insurance and Melinda’s 

medical history and that, as a result, the Policy was void. MetLife Ex. 1-D, ECF No. 88-5. 

 On March 11, 2016, Steven was convicted of Melinda’s murder. Estate SJ Ex. E. 

 In his March 19, 2018 affidavit, Mr. Fluharty states, “[T]o date no such policy [for 

Steven] was ever located, identified, or submitted despite [MetLife] conducting a thorough and 

reasonable investigation and despite lengthy opportunity for any claiming or beneficiary party to 

locate, identify, or submit such a policy.” MetLife Ex. 1, ¶ 14. 

PROCEDURAL BACKGROUND 

 On March 16, 2016, MetLife filed its Complaint for Rescission [ECF No. 4] in this Court 

against Steven Lindsey and the Estate of Melinda Lindsey. MetLife seeks to rescind the Policy 

based upon the alleged material misrepresentations in the Application regarding Steven’s life 

insurance and Melinda’s medical history and asks for a declaratory judgment that the Policy is 

rescinded and that coverage under the Policy is void. See Compl. 7. On June 8, 2016, MetLife 

filed a First Amended Complaint for Rescission [ECF No. 14], adding as a defendant Julie 

Kirby, in her capacity as Personal Representative of the Probate Estate of Melinda Lindsey. On 

June 10, 2016, the Estate of Melinda Lindsey and Julie Kirby in her capacity as Personal 

Representative of the Probate Estate of Melinda Lindsey (collectively, the “Estate”) filed an 

Answer and Counterclaims for breach of contract (Count I), estoppel and waiver (Count II), and 

breach of the covenant of good faith and fair dealing (Count III). See ECF No. 16. MetLife filed 

an Answer [ECF No. 21] to the Counterclaims. 

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 MetLife deposited the life insurance premium refund with the Clerk of Court. See ECF 

Nos. 41–43, 60, 61, 66, 67, 69, 71–74, 76–78, 81. 

 MetLife filed the instant Motion for Summary Judgment [ECF No. 87]. The Estate filed a 

response [ECF No. 97], and MetLife filed a reply [ECF No. 98]. With its reply brief, MetLife 

filed a Supplemental Designation of Evidence [ECF No. 99] and a Motion to Strike [ECF No. 

100], asking the Court to strike portions of the Affidavit of the Estate’s designated expert John F. 

Fitzgerald. The Estate also filed a Motion to Strike [ECF No. 103], asking the Court to strike 

MetLife’s Supplemental Designation of Evidence and the corresponding portions of the reply 

brief. Both motions to strike are fully briefed. See ECF Nos. 101, 102, 104–07. 

At a telephonic conference on March 12, 2021, the Court raised the issue of service of 

process on Steven Lindsey. Ruling on a motion filed by the Estate, the Court dismissed Steven 

Lindsey pursuant to Federal Rule of Civil Procedure 4(m). See ECF No. 134. However, 

MetLife’s claim for recission proceeds against the Estate because Steven Lindsey, who has been 

designated a constructive trustee under Indiana’s codified slayer rule, has no legal interest in the 

Policy proceeds. Id. 

ANALYSIS 

 In its motion for summary judgment, MetLife seeks judgment in its favor on its claim for 

rescission of the Policy as well as on the Estate’s counterclaims. The Court considers the motion 

as to each claim in turn. 

A. MetLife’s Claim for Rescission 

MetLife’s First Amended Complaint brings a claim to rescind Melinda’s life insurance 

Policy and coverage under the Policy as void ab initio. MetLife alleges that Melinda made 

material misrepresentations on the Application regarding both her medical history and the 

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existence of life insurance for her spouse, Steven, upon whom she was financially dependent. In 

the instant motion, MetLife seeks summary judgment on its claim for rescission solely based on 

the alleged material misrepresentation regarding Steven’s life insurance policy. 

 Under Indiana law, “a material misrepresentation or omission of fact in an insurance 

application, relied on by the insurer in issuing the policy, renders the coverage voidable at the 

insurance company’s option.” Foster v. Auto-Owners Ins., Co., 703 N.E.2d 657, 659 (Ind. 1998) 

(quoting Colonial Penn Ins. Co. v. Guzorek, 690 N.E.2d 664, 672 (Ind. 1997)).1 “False 

representations concerning a material fact, which mislead, will void an insurance contract, just as 

any other contract, regardless of whether the misrepresentation was innocently made or made 

with a fraudulent intent.” Bennett v. CrownLife Ins. Co., 776 N.E.2d 1264, 1269 (Ind. Ct. App. 

2002) (citation omitted). “A representation is material if the fact omitted or misstated, if truly 

stated, might reasonably have influenced the insurer in deciding whether to reject or accept the 

risk or charge a higher premium.” Ruhlig v. Am. Cmty. Mut. Ins. Co., 696 N.E.2d 877, 880 (Ind. 

Ct. App. 1998) (citation omitted). 

 In its motion, MetLife argues that Melinda’s statement in her January 2, 2014 

Application that Steven had insurance with a value of $2,000,000 was a misrepresentation. And, 

MetLife argues that the misrepresentation was material because MetLife would not have issued 

the Policy if Steven did not have a life insurance policy with a face amount of coverage at least 

equal to the face amount of the policy applied for by Melinda. As the party with the burden of 

proof at trial, MetLife must demonstrate why the record is so one-sided on each element as to 

rule out the prospect of a finding in favor of the Estate. To support its motion, MetLife offers the 

1

 In addition, “a party seeking rescission must return all consideration or benefits received under the 

contract.” French v. State Farm Fire & Cas. Co., 950 N.E.2d 303, 311 (Ind. Ct. App. 2011) (citation 

omitted). MetLife has deposited the life insurance premiums with the Clerk of Court.

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affidavit of its investigator, Mr. Mirabelli, and the affidavit of its Vice President, Mr. Fluharty. 

The instant motion fails at the first prong because there is a genuine dispute of material fact as to 

whether Melinda’s statement about Steven’s insurance was false. For the reasons set forth below, 

the affidavits are insufficient to meet MetLife’s burden to “establish affirmatively the lack of 

‘sufficient evidence favoring’” the Estate to return a verdict for MetLife. Reserve Supply Corp., 

971 F.2d at 42 (quoting Anderson, 477 U.S. at 249–50). 

 Mr. Mirabelli’s affidavit establishes only that his investigation did not uncover any 

evidence of a life insurance policy for Steven. However, because of the limited and incomplete 

nature of Mr. Mirabelli’s investigation, a genuine dispute of fact remains as to whether Steven 

had life insurance on January 2, 2014. First, Mr. Mirabelli contacted only fifteen companies to 

inquire whether Steven had a life insurance policy, and the companies selected were based on 

personal contacts he had developed over the years as an investigator. For example, Mr. Mirabelli 

did not contact Allstate Insurance Company, American Family Insurance, AIG, American 

Fidelity Insurance, Farmers Insurance Group, Guardian Life Insurance, Lincoln National, or 

Mutual of Omaha, all of whom he believes provide life insurance policies. Thus, it is possible 

that an insurer not contacted by Mr. Mirabelli had a policy for Steven on January 2, 2014. 

 Second, two of the fifteen insurers did not respond to Mr. Mirabelli’s inquiry. Thus, it is 

possible that one of those two providers issued a life insurance policy for Steven that was in 

effect on January 2, 2014. 

 Third, Mr. Mirabelli’s March 2015 email to the fifteen insurance companies did not 

specify the time frame of his inquiry. Although the relevant question is whether Steven had a life 

insurance policy at the time Melinda submitted the Application on January 2, 2014, Mr. 

Mirabelli’s email did not ask if the insurers had a policy for Steven on January 2, 2014, but 

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rather: “Can you please check for any coverage on these individuals?” In his deposition, Mr. 

Mirabelli agreed that there could have been prior insurance coverage even though the email 

response that there was no coverage in March 2015 could also be accurate. 

 Next, as argued by the Estate, MetLife did not investigate whether Steven had a life 

insurance policy through his employer, Exelon, as of January 2, 2014. During the investigation, 

MetLife established Steven’s employment with Exelon from January 5, 2009, to January 27, 

2014, by obtaining a verification of employment. Thus, MetLife knew that Steven was employed 

by Exelon at the time of Melinda’s Application on January 2, 2014, and Melinda indicated on her 

Application that his income was $180,000. Yet, Mr. Mirabelli did not contact Exelon to 

determine whether Exelon provided Steven with group life insurance and, if so, the amount of 

coverage. In support of its response brief, the Estate offers evidence that, at the time of 

Melinda’s Application on January 2, 2014, Exelon offered its full-time employees life insurance 

and accidental death insurance. Thus, it appears possible that Steven had insurance through his 

employer, Exelon, on January 2, 2014. 

 Finally, Mr. Mirabelli did not contact Steven during his investigation. Nor is there 

evidence that anyone at MetLife contacted Steven prior to the determination that Melinda made a 

false statement on the Application regarding Steven’s insurance. The first communication with 

Steven was MetLife’s June 25, 2015 letter informing him that the Policy was void based on 

MetLife’s determination that Melinda had made material misrepresentations on her Application. 

 MetLife also offers the March 19, 2018 affidavit of its Vice President, Mr. Fluharty, that, 

as of the date of his affidavit, no one had come forward with proof of insurance for Steven, 

which MetLife argues supports its initial conclusion that Steven did not have a life insurance 

policy at the time of the Application. In its reply brief, MetLife contends that the Estate, as the 

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nonmoving party, must come forward with evidence that Steven had a life insurance policy. 

However, this is an improper attempt to shift the burden to the Estate on an issue on which 

MetLife bears the burden of proof at trial. “A party opposing summary judgment does not have 

to rebut factual propositions on which the movant bears the burden of proof and that the movant 

has not properly supported in the first instance.” Johnson v. Hix Wrecker Serv., Inc., 651 F.3d 

658, 662 (7th Cir. 2011). It is MetLife’s burden to establish that Melinda’s statement on the 

Application was false, and MetLife has not properly supported its assertion that Melinda made a 

false statement. The fact that neither Steven, who was being prosecuted for and was then 

convicted of Melinda’s murder, or anyone else came forward with evidence of an insurance 

policy since MetLife sent the June 25, 2015 letter does not establish that Steven did not have 

insurance on January 2, 2014.2

 In response to MetLife’s motion, the Estate has shown that there is a genuine dispute of 

material fact for trial as to whether Melinda made a false statement on the Application regarding 

Steven’s life insurance. Accordingly, the Court denies MetLife’s motion for summary judgment 

on its claim for rescission.3

B. The Estate’s Counterclaims 

1. Breach of Contract 

 In Count I for breach of contract, the Estate alleges that MetLife breached the Policy by 

failing and refusing to pay the beneficiary the sum of $1,100,000 under the Policy following 

Melinda’s death and a demand for payment. MetLife seeks summary judgment on this claim 

2

 The Court need not consider the new evidence offered in MetLife’s Supplemental Designation of 

Evidence or the corresponding arguments in its reply brief, all of which relate to MetLife’s unsuccessful 

litigation discovery efforts to obtain information from Steven. Thus, the Estate’s motion to strike is moot. 

3

 In relation to MetLife’s motion to strike the affidavit of John F. Fitzgerald, the Court did not consider 

Mr. Fitzgerald’s expert opinion on industry standards in claims handling to determine that there is a 

genuine dispute of material fact on this claim. 

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based on its defense of rescission. See Answer to Countercl. 13, ECF No. 21; Am. Fam. Ins. Grp. 

v. Ford, 293 N.E.2d 524, 577 (Ind. Ct. App. 1973) (“[R]escission of a contract is an affirmative 

defense.” (quoting Storer v. Markley, 73 N.E. 1081 (Ind. 1905))). Here, MetLife relies on the 

same arguments made in support of its own claim for rescission—namely, that it is entitled to 

rescind the Policy based on Melinda’s alleged material misrepresentation in the Application 

regarding Steven’s insurance. For the same reasons set forth above, MetLife cannot meet its 

burden on this defense because there is a genuine dispute of material fact as to whether 

Melinda’s statement was false. Therefore, the Court denies MetLife’s motion for summary 

judgment on the Estate’s breach of contract counterclaim. 

2. Estoppel/Waiver and Breach of Duty of Good Faith and Fair Dealing 

 In Count II, the Estate alleges that MetLife waived its right to rescind the Policy and 

should be estopped from denying payment under the Policy. In Count III, the Estate alleges that 

MetLife breached its duty of good faith and fair dealing. Both claims are based on an alleged 

failure by MetLife to investigate the statements in Melinda’s Application prior to her death. 

Seeking summary judgment on both counterclaims, MetLife argues that it had no duty under 

Indiana law to investigate the truthfulness of Melinda’s statements in her Application and that it 

was not on inquiry notice of a need to investigate because Melinda signed the Application and a 

statement confirming its accuracy. The Estate responds that MetLife had independent knowledge 

to put it on inquiry notice of the need to investigate the truthfulness of Melinda’s statement 

regarding Steven’s life insurance. For the reasons set forth below, the Court denies the motion as 

to these counterclaims. 

 The Indiana Supreme Court has held that an “‘insurer may rely on representations of fact 

in the application without investigating their truthfulness’ and has ‘no duty to look beneath the 

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surface’ of the representations on the application.” Foster, 703 N.E.2d at 660 (quoting Guzorek, 

690 N.E.2d at 674; citing State Farm Mut. Auto. Ins. Co. v. Price, 396 N.E.2d 134, 137 (Ind. Ct. 

App. 1979)); see also Goar v. Federated Life Ins. Co., No. 1:13-CV-919, 2015 WL 1608842, at 

*16 (S.D. Ind. Apr. 10, 2015) (quoting Allied Prop. & Cas. Ins. Co. v. Good, 938 N.E.2d 227, 

232 (Ind. Ct. App. 2010) (quoting Guzorek, 690 N.E.2d at 674))). In Foster, the court explained 

that “[i]t is not unreasonable to demand that an insured supply accurate and complete 

information, read the application before signing it, and suffer the consequences if an omission or 

misstatement in the application is material to a subsequent loss.” 703 N.E.2d at 660. 

 However, “an insurer cannot avoid coverage where it had knowledge of the facts 

notwithstanding the material misrepresentations, or where a reasonable person would have 

investigated further.” Id. (quoting Guzorek, 690 N.E.2d at 674; citing Johnson v. Payne, 549 

N.E.2d 48, 51–52 (Ind. Ct. App. 1990)). In Guzorek, the Indiana Supreme Court explained that 

“the insurer may rely on representations of fact in the application without investigating their 

truthfulness, unless there is some reason to believe the representations are false.” Guzorek, 690 

N.E.2d at 674 (emphasis added) (citing Price, 396 N.E.2d at 137); see also Ruhlig, 696 N.E.2d at 

881). “Thus, when the insurer had sufficient information to place it on inquiry notice of possible 

falsity, whatever facts a reasonably diligent investigation would have discovered are imputed to 

the insurer.” Guzorek, 690 N.E.2d at 674 (citing Payne, 549 N.E.2d at 51–52). 

 Assuming that Steven did not have life insurance through his employer or otherwise on 

January 2, 2014, the Estate argues that MetLife’s independent knowledge that Steven was 

interested in obtaining an insurance policy for himself put MetLife on inquiry notice of a 

possible falsity in Melinda’s Application. In support, the Estate cites the October 17, 2013 phone 

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conversation between Steven and MetLife agent Mr. Ambler and the January 31, 2014 phone 

conversation between Steven and MetLife representative Ashley. 

 The Estate has shown a genuine dispute of material fact as to whether MetLife was on 

inquiry notice regarding Steven’s insurance status based on the October 17, 2013 telephone 

conversation between Steven and Mr. Ambler.4 In that conversation, Steven told Mr. Ambler, 

“I’m looking to get my life insurance policy renewed.” Steven explained that he had a policy for 

a long time with MetLife but that he got divorced and his “ex-wife got the balance of the term 

life today and the other one just got canceled.” Steven told Mr. Ambler that he would “like to at 

least get the short-term one going again until I can get my mind wrapped around so I can start the 

term life insurance policy.” Steven also expressed to Mr. Ambler an interest in obtaining a policy 

for Melinda, who was his fiancée at the time. Mr. Ambler is the same agent who then spoke to 

Melinda on January 2, 2014, and filled out her Application. The Estate argues that this 

conversation with Steven, along with unsuccessful subsequent efforts to complete Steven’s 

application, put Mr. Ambler on notice to investigate the truthfulness of Melinda’s answer that 

Steven had $2,000,000 in life insurance at the time of her January 2, 2014 Application. 

 In its reply brief, MetLife does not address the Estate’s assertion that Mr. Ambler had 

independent knowledge based on his conversation with Steven, nor does MetLife argue that the 

conversation was insufficient to put Mr. Ambler, and thus MetLife, on notice to investigate the 

truthfulness of Melinda’s statement in her Application. Rather, MetLife contends that, as a 

matter of law, its knowledge is irrelevant because Melinda’s signature on the Application 

confirming that her answers were true entitles MetLife to rely on her statements in the 

Application, even if MetLife allegedly knew the answers were not correct. However, the cases 

4

 As a result, the Court need not address on this motion whether the January 31, 2014 phone conversation 

between Steven and MetLife representative Ashley also put MetLife on inquiry notice. 

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cited by MetLife are distinguishable on the issue of waiver because in each case, the applicant 

personally knew the correct information and could have ensured it was correct on the application 

prior to signing. 

 In Foster and Buckeye, the applicant gave correct information to the agent, but the agent 

included incorrect information in the application. Thus, the applicant was in a position to 

recognize the false information prior to signing, but signed anyway, attesting to the truthfulness 

of the information in the application. In each case, the court held the applicant responsible for the 

misrepresentation, notwithstanding the agent’s involvement in filling out the application. See 

Foster, 703 N.E.2d at 659–60 (citing Metro. Life Ins. Co. v. Alterovitz, 14 N.E.2d 570, 574 (Ind. 

1938)); Buckeye State Mut. Ins. Co. v. Hall, No. 2:05-CV-21, 2006 WL 3450603, at *7–8 (N.D. 

Ind. Nov. 29, 2006); see also Goar, 2015 WL 1608842, at *12 (citing Brennan v. Hall, 904 

N.E.2d 383, 387 (Ind. Ct. App. 2009)); Am. Fam. Mut. Ins. Co. v. Jeffery, No. IP 98-1085-C 

H/G, 2000 WL 680410, at *3–7 (S.D. Ind. Feb. 28, 2000); Fed. Kemper Ins. Co. v. Brown, 674 

N.E.2d 1030, 1034 (Ind. Ct. App. 1997) (citing Alterovitz, 14 N.E.2d at 574–75). In Wachel and 

Ruhlig, which involved misrepresentations regarding the applicant’s medical history, the court 

held that the applicant who signed the application attesting to its truthfulness was responsible for 

the material misrepresentations and that the insurer had no duty to obtain the applicant’s medical 

records to check for inconsistencies or misstatements on the application. See Wachel v. First 

Colony Life Ins. Co., No. 2:05-CV-292, 2008 WL 73647, at *18–20 (N.D. Ind. Jan. 4, 2008);

Ruhlig, 696 N.E.2d at 881.5

5

 Notably, in each of those cases cited above, there was no factual dispute as to the falsity of the statement 

in the application. In this case, whether Melinda’s statement that Steven had $2,000,000 in life insurance 

was false remains a disputed fact for trial. 

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In contrast, the Estate is arguing that Mr. Ambler had independent knowledge based on 

his earlier conversation with Steven on October 17, 2013. Melinda’s signature on the January 2, 

2014 application affirmed that, “to the best of my knowledge and belief, all statements are true 

and complete.” It is unclear how Melinda’s signature would relieve MetLife of a duty to 

investigate based on Mr. Ambler’s independent knowledge separate from what Melinda told him 

or what Melinda herself knew. See, e.g., Wachel, 2008 WL 73647, at *20 (finding that, even 

though the insurers had no duty to obtain medical records to verify statements in a signed 

application, once the insurers in fact obtained medical records and “obtained independent 

knowledge on their own initiative prior to issuing policies[,] [t]hey cannot now claim ignorance 

of the information that came to light through their investigation” (citing Foster, 703 N.E.2d at 

660)); see also Guzork, 690 N.E.2d at 674 (noting that there was no claim that the insurer knew 

or should have known the fact that would have put it on inquiry notice of the material 

misrepresentation in the application); Jeffery, 2000 WL 680410, at *7 (holding that the insured 

was responsible for the material misrepresentation in the application, even though the agent 

knew the information was false, because the insured signed the application, but also noting that 

the insured “has submitted no evidence indicating that [the insurer] had independent knowledge” 

related to the material misrepresentation). 

 MetLife also argues that, because Melinda signed the Application, MetLife was not 

required to cross-check the accuracy of the statements on her application with other forms or 

information, “including any telephone recordings with third-party vendors, as [the Estate] 

allege[s].” MetLife Reply 12, ECF No. 98. This appears to be a reference to the recordings of 

Steven’s phone conversations with Mr. Ambler on October 17, 2013, and Ashley on January 31, 

2014. However, the Estate is not arguing that someone at MetLife should have listened to the 

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recordings of Steven’s phone calls and then cross-checked them against Melinda’s Application. 

Rather, the Estate is arguing that the conversations themselves put Mr. Ambler and Ashley, as 

agents of MetLife, on notice that further investigation was necessary. 

 Moreover, the cases cited by MetLife are distinguishable because the insurer in each case 

was not required to cross-check prior applications or documents submitted by the applicant. See 

Foster, 703 N.E.2d at 660 (holding that, as a matter of law, an insurer has no obligation to crosscheck the accuracy of an application with other applications of the “same applicant”); Goar, 

2015 WL 1608842, at *14, *16 (“Mr. Goar’s answers on the enrollment materials for the group 

health insurance policy were not part of the Application, Acknowledgement, or Policy under 

which Mr. Goar seeks coverage here, and Federated was under no obligation to cross reference 

the information he provided in the Application with his disclosures in that separate context.”).

Here, Mr. Ambler’s earlier conversation was with Steven, not Melinda.

On the record before the Court, there is a question for the jury as to whether Mr. Ambler 

had “some reason to believe [Melinda’s] representations are false,” Guzorek, 690 N.E.2d at 674. 

Therefore, the Court denies MetLife’s motion for summary judgment on Counts II and III of the 

Estate’s Counterclaim.6

 

MOTIONS TO STRIKE 

As set forth above, the Court’s ruling did not rely on either the new evidence and 

argument submitted by MetLife with its reply brief or Mr. Fitzgerald’s opinions submitted by the 

Estate. Therefore, the Court denies both motions to strike as moot. See, e.g., Vaught v. Quality 

Corr. Care, LLC, No. 1:15-CV-346, 2018 WL 1900153, at *2 (N.D. Ind. Apr. 19, 2018) 

(“Because the Court is able to distinguish which exhibits, affidavits, statements, and commentary 

6

 The Court did not consider Mr. Fitzgerald’s expert opinion on industry standards in claims handling to 

determine that there is a genuine dispute of material fact on these counterclaims. 

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may properly be considered when deciding whether summary judgment is appropriate, the Court 

declines to strike these statements from the Plaintiff’s Memorandum.”). 

CONCLUSION 

Based on the foregoing, the Court hereby DENIES MetLife’s Motion for Summary 

Judgment [ECF No. 87], DENIES as moot MetLife’s Motion to Strike the Affidavit of John F. 

Fitzgerald [ECF No. 100], and DENIES as moot the Estate’s Motion to Strike MetLife’s 

Supplemental Designation of Evidence and Corresponding Portions of Reply Brief [ECF No. 

103]. All claims and counterclaims remain pending for trial. 

SO ORDERED on November 2, 2021. 

 s/ Theresa L. Springmann 

 JUDGE THERESA L. SPRINGMANN 

 UNITED STATES DISTRICT COURT 

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