* Pursuant to 5TH CIR. R. 47.5, the Court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 07-30357

DIANA DOIRON

Plaintiff-Appellee

v.

CONSECO HEALTH INSURANCE COMPANY

Defendant-Appellant

Appeal from the United States District Court 

for the Middle District of Louisiana

USDC No. 04-784-JJB-CN

Before JONES, Chief Judge, and DAVIS and GARZA, Circuit Judges.

PER CURIAM:*

In this appeal, Defendant-Appellant Conseco Health Insurance Company

(“Conseco”) appeals the district court’s grant of Plaintiff-Appellee Diana Doiron’s

(“Doiron”) Motion for Class Certification. We vacate and remand.

I.

The proposed lead plaintiff, Doiron, filed suit on behalf of a class of

approximately 198 Conseco policyholders, alleging that Conseco breached its

policy obligations. Doiron alleges she purchased a policy of cancer insurance for

United States Court of Appeals

Fifth Circuit

F I L E D

May 28, 2008

Charles R. Fulbruge III

Clerk
No. 06-11088

1 The Radiation Chemotherapy Benefit reads:

We will pay this benefit if your physician prescribes radiation or chemical

treatments for the destruction of abnormal tissue as part of cancer treatment.

Examples of these treatments include:

• X-ray radiation;

• Radium and cesium implants;

• Cobalt;

• Hormone therapy; and,

• Chemotherapy.

The U.S. Food and Drug Administration must have classified the cancer

treatment either as approved or investigational. These treatments may be

performed on an inpatient or outpatient basis.

We will not pay for any type of diagnostic tests or laboratory tests related to

these treatments.

The maximum amount payable for approved and investigational treatment for

each person insured by this policy is shown in the Benefit Schedule.

2

herself and her husband. She alleges the policy obligated Conseco to pay

specified benefits for charges incurred if she or her husband was diagnosed with

cancer. Doiron’s husband was subsequently diagnosed with cancer. He

underwent medicaltreatmentincluding radiation and chemotherapy treatment,

but later died due to his illness. Doiron alleges that although she submitted

proof of loss, medical records, medical bills, and other documentation to Conseco,

Conseco paid only some benefits but denied others including some benefits

submitted under the policy’s Radiation/Chemotherapy Benefit provision.1

Doiron claims that Conseco’s failure to pay all the benefits is a breach of

contractual obligations and sought class certification for similarly situated

plaintiffs. Doiran alleges that Conseco has a uniform corporate policy of denying

claims for benefits for certain charges that she and other class members incurred

as part of their radiation and chemotherapy treatments. Doiron proposed two

sub-classes, which the district court accepted. One sub-class consists of

policyholders who incurred specific charges as part of their radiation treatment

and whose claims were or will be denied by Conseco. The other sub-class
No. 06-11088

3

consists of policyholders who incurred specified charges as part of their

chemotherapy treatment and whose claims were or will be denied by Conseco.

During discovery Conseco agreed to conduct a random sampling of 28 class

members (the “sample group”) and to review their claim records. Both parties

stipulated that this review indicated, inter alia, that: (1) Conseco paid at least

one claim for radiation or chemotherapy treatment benefits under the

Radiation/Chemotherapy Benefit provision for Doiron and each person in the

sample group; (2) Conseco denied for Doiron and each person in the sample

group at least one claim for benefits for one or more of disputed radiation and

chemotherapy treatment charges solely for the reason that they were “not

covered” under the Radiation/Chemotherapy Benefit provision; and (3) Conseco

denied claims, including radiation and chemotherapy claims, for eligibility or

timeliness reasons for some in the sample group.

The district court held that Doiron’s proposed sub-classes satisfied the

requirements of Rules 23(a) and 23(b)(3). For the reasons that follow, we vacate

certification of the sub-classes and remand to the district court for further

proceedings consistent with this opinion.

II.

We review a district court’s certification of a class for abuse of discretion.

O’Sullivan v. Countrywide Home Loans, Inc., 319 F.3d 732, 738 (5th Cir. 2003).

“Implicit in this deferential standard is a recognition of the essentially factual

basis of the certification inquiry and of the district court’s inherent power to

manage and control pending litigation.” In re Monumental Life Ins. Co., 365

F.3d 408, 414 (5th Cir. 2004) (quoting Allison v. Citgo Petroleum Corp., 151 F.3d

402, 408 (5th Cir. 1998)). We review the legal standards applied by the district

court de novo. Id. Conseco challenges the district court’s certification order on

a number of grounds which we consider below.
No. 06-11088

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A. Rule 23(a) Commonality

Conseco argues thatthe district court erred because the individuals in the

sub-classes do not present a common issue of law. Conseco argues that it may

have denied claims because they were untimely, duplicate, lacked proof of loss,

or were “not covered” under a provision of the policy. This is because the

approved sub-class definitions sweep into the sub-classes both (1) policyholders

that have had claims denied as “not covered” under the Radiation/Chemotherapy

Benefit provision and (2) policyholders that have had claims denied for other

reasons. As such, Conseco argues that for each sub-class member the court will

have to do a claim-by-claim analysis to determine whether the claim was denied

under the Radiation/Chemotherapy Benefit provision. 

Commonality requires that there be “questions of law or fact common to

the class.” James v. City of Dallas, 254 F.3d 551, 570 (5th Cir. 2001). The

plaintiff need only show that “there is at least one issue whose resolution will

affect all or a significant number of the putative class members. Forbush v. J.C.

Penny Co., 994 F.2d 1101, 1106 (5th Cir. 1993) (citation omitted). That “some

of the plaintiffs may have different claims, or claims that may require some

individualized analysis, is not fatal to commonality.” James, 254 F.3d at 570.

Although every member of the sample group had at least one claim that

Conseco denied for the sole reason that it was “not covered” under the

Radiation/Chemotherapy Benefit provision, it is impossible to know whether this

commonality extends to every member ofthe class. Thus, the district court erred

in approving the sub-classes, as defined, because they may sweep into the subclasses policyholders who had claims denied for reasons other than that the

claims were “not covered” under the Radiation/Chemotherapy Benefit provision.

Although all other requirements of Rule 23(a) are satisfied by these sub-class

definitions, on remand the district court should revisit the sub-class definitions

to narrow the sub-classes such that they include only policyholders who had
No. 06-11088

5

claims denied only because they are “not covered” under the

Radiation/Chemotherapy Benefit provision. Once the sub-classes are so defined,

the sub-classes will satisfy every element of Rule 23(a).

B. Rule 23(b)(3) Predominance and Superiority

Conseco argues that common issues do not predominate because the court

cannot determine liability by simply interpreting the language of the

Radiation/Chemotherapy Benefit provision. The court, Conseco continues, would

have to conduct individualized mini-trials for sub-class members to determine

the reasons Conseco denied their claims and whether other reasons for denying

the claims shield Conseco from liability. 

The predominance inquiry requires that questions of law or fact common

to the members of the class “predominate over any questions affecting only

individual members.” Unger v. Amedisys Inc., 401 F.3d 316, 320 (5th Cir. 2005).

This requirement, although similar to the commonality requirement of Rule

23(a), is “far more demanding” and “tests whether proposed classes are

sufficiently cohesive to warrant adjudication by representation.” Id. The

predominance inquiry requires a court to consider, if the class were certified,

how trial on the merits would be conducted. Bell Atlantic Corp. v. AT&T Corp.,

339 F.3d 294, 302 (5th Cir. 2003). The superiority requirement is simply that

“class action is superior to other available methods for the fair and efficient

adjudication of the controversy.” FED R. CIV. P. 23(b)(3).

As discussed above, itis true that, as the sub-classes are currently defined,

they sweep in claims that may have been denied for reasons other than as “not

covered” under the Radiation/Chemotherapy Benefit provision. If the subclasses are not narrowed as set forth above, Conseco would have a valid point

that many of the relevant claims were denied as untimely, duplicate, or lacking

in proof of loss. If class members decided to challenge the denial of these claims,

the court would have to conduct mini-trials, which would prevent common issues
No. 06-11088

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from predominating in each sub-class. We are satisfied, however, that the subclass definition set forth above including only policyholders whose claims were

denied for the sole reason that they are “not covered” under the

Radiation/Chemotherapy Benefit provision, would satisfy this concern. As

redefined the sub-classes would not include policyholders against whom Conseco

has the aforementioned alternative defenses and would thus satisfy the

predominance requirement of Rule 23(b)(3). Conseco also argues that class

action is not the superior method of resolving these policyholders’ claims. On

this point, we agree with the district courtthat class action is more efficientthan

dealing with over one hundred individual suits relying on the same theory and

proof of liability. We conclude that the sub-classes, redefined as discussed above,

would satisfy allthe requirements of Rule 23(b)(3), including both predominance

and superiority.

C. Bad Faith

Louisiana insurance law requires that an insurer pay covered claims for

medical bills no more than thirty days from the date the insurer receives notice

and proof of the claim, unless the failure to pay is supported by just and

reasonable grounds. LA. R. S. § 22:657. Unless a denial is based on just and

reasonable grounds, it is deemed “arbitrary and capricious.” Stewart v.

Calcasieu Parish Sch. Bd., 933 So.2d 797, 801 (La. App. 3d Cir. 2006). Whether

a denial is arbitrary or capricious is a fact-based analysis. Id.

Doiron alleges that Conseco was arbitrary and capricious in denying policy

benefit payments to the plaintiff and the other class members. Conseco argues

that Doiron’s bad faith claims preclude class certification because they require

a fact-based analysis of each claim to determine whether Conseco acted in an

arbitrary and capricious manner. Under the current sub-class definitions, the

court would have to test each claim individually to determine whether it was

made in bad faith. If the sub-classes are redefined as described above, however,
No. 06-11088

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individualized fact-based inquires to examine bad faith claims will be

unnecessary. Doiron and the other class members would have to show that

Conseco’s failure to pay for covered charges was unreasonable, which would turn

on Conseco’s interpretation of the policy’s coverage for chemotherapy and

radiation, issues that would not vary among different class members. Thus,

with the sub-classes redefined as discussed above, the question of bad faith

claims does not create an obstacle to class certification.

III.

For all the reasons stated above, we conclude that the sub-classes should

be narrowed such thatthey include only policyholders whose claims were denied

for the sole reason that they are “not covered” under the

Radiation/Chemotherapy Benefit provision. The sub-classes, so defined, would

satisfy the requirements of Rule 23(a) and Rule 23(b)(3), including those

challenged by Conseco, and would justify class certification. We thus VACATE

the certification order and REMAND to the district court for redefinition of the

sub-classes and for further proceedings consistent with this opinion. 

VACATED and REMANDED.