Court Opinion

ID: 2821489
Source: CourtListenerOpinion
Date Created: 2015-07-29 20:15:47.725579+00
Date Added: 2024-06-11T09:44:36.131122
License: Public Domain

ATTORNEYS FOR APPELLANTS          ATTORNEYS FOR APPELLEE           ATTORNEYS FOR APPELLEE
 Robert D. MacGill                 CONTINENTAL CASUALTY             TWIN CITY FIRE INSURANCE
 Charles P. Edwards                COMPANY                          COMPANY
 Christian P. Jones                Stephen J. Peters                James W. Riley, Jr.
 Mark D. Crandley                  David I. Rubin                   Riley Bennett & Egloff, LLP
 Barnes & Thornburg LLP            Plunkett Cooney, P.C.            Indianapolis, Indiana
 Indianapolis, Indiana             Indianapolis, Indiana
                                                                    John E. Black, Jr.
 Dan J. Hofmeister, Jr.            Michael M. Marick                Peter F. Lovato
 Kevin D. Tessier                  Rebecca R. Haller                Skarzynski Black LLC
 Reed Smith LLP                    Meckler Bulger Tilson Marick &   Chicago, Illinois
 Chicago, Illinois                 Pearson LLP
                                   Chicago, Illinois                Mark E. Haddad
 ATTORNEYS FOR AMICI CURIAE                                         Jonathan F. Cohn
 [see addendum]                                                     Sidley Austin LLP
                                                                    Washington, DC
_____________________________________________________________________________

                                            In the
                            Indiana Supreme Court                          Jul 29 2015, 3:42 pm
                            _________________________________

                                   No. 49S05-1404-PL-244

WELLPOINT, INC. (F/K/A ANTHEM, INC.) AND
ANTHEM INSURANCE COMPANIES, INC.,                                   Appellants (Plaintiffs),
                                                    v.

NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA,
AIG EUROPE (U.K.) LIMITED,
NEW HAMPSHIRE INSURANCE COMPANY,
CONTINENTAL CASUALTY COMPANY,
ARROWOOD INDEMNITY COMPANY,
TWIN CITY FIRE INSURANCE COMPANY,
LIBERTY MUTUAL INSURANCE COMPANY (U.K.) LIMITED, AND
CERTAIN UNDERWRITERS AT LLOYDS,                          Appellees (Defendants).
                        _________________________________

                Appeal from the Marion Superior Court, No. 49D10-0507-PL-26425
                              The Honorable David J. Dreyer, Judge
                             _________________________________

                                  On Petition For Rehearing
                            _________________________________

                                         July 29, 2015
Dickson, Justice.

       Appellees Continental Casualty Company and Twin City Fire Insurance Co. (collectively
"CNA"), have petitioned for rehearing with respect to our opinion in this matter, Wellpoint, Inc.
v. Nat'l Union Fire Ins. Co., 29 N.E.3d 716 (Ind. 2015). The petition asserts a single claim—that
a portion of our opinion exceeds the power granted by Trial Rule 56(B), which states that
"[w]hen any party has moved for summary judgment, the court may grant summary judgment for
any other party upon the issues raised by the motion although no motion for summary judgment
is filed by such party." T.R. 56(B) (emphasis added). CNA does not challenge our reversal of
the trial court's grant of its motion for summary judgment, but argues that our opinion should not
have also granted summary judgment for Anthem as to issues not raised by CNA's summary
judgment motion. CNA seeks modification of the fifth paragraph of our opinion to clarify that
its summary judgment motion "raised only certain issues of law prior to the close of discovery,"
Pet. for Reh'g at 13, and revision of our concluding language that could be read to foreclose de-
fenses not raised in the summary judgment proceedings. Appellants Wellpoint, Inc. and Anthem
Insurance Companies, Inc. (collectively "Anthem") respond that summary judgment in Anthem's
favor is proper and further that CNA has waived any additional affirmative defenses.

       We agree Trial Rule 56(B) limits our authority to grant summary judgment for Anthem to
the issues raised in CNA's motion. Before the trial court, CNA requested summary judgment in
its favor on certain enumerated counts/claims for the reasons set forth in its supporting memoran-
dum. Relevant text from CNA's motion and supporting memorandum is as follows:

       Pursuant to T.R. 56, Defendant [CNA] hereby moves for summary judgment in its favor
       and against Plaintiffs WellPoint, Inc. . . . and Anthem Insurance Companies ["Anthem"]
       on Counts II, III, IV, and V (incorrectly designated as Count IV) of Anthem's Second
       Amended Complaint for Declaratory Judgment and Damages ("Second Amended Com-
       plaint").

Motion for Summary Judgment, Appellants' App'x at 610 (emphasis added).

       WHEREFORE, for the reasons set forth in [CNA's] supporting Memorandum, [CNA] re-
       spectfully requests that this Court enter final judgment in [CNA's] favor on all claims al-
       leged in Anthem's Second Amended Complaint as follows:
               (1)    denying Anthem's claim for declaratory relief under Count II;
               (2)    denying Anthem's claim for breach of contract under Count III;

                                                    2
                 (3)   denying Anthem's claim for bad faith under Count IV; and
                 (4)   denying Anthem's claim for punitive damages under Count V.

Id. at 611–12 (emphases added). CNA's brief supporting its summary judgment motion included
the following:

       [T]here is no coverage under the Policies for Anthem's settlement of the RICO/CUTPA-
       Based Claims for each of the following and separate reasons:3 . . . First [no coverage for
       intentional conduct or ordinary business obligations] . . . . Second [not a "Loss"] . . . . Third
       [Exclusion (b) excludes coverage for "any dishonest or fraudulent act or omission"] . . . .
       Fourth [not in the "rendering of or failure to render Professional Services"] . . . . Addition-
       ally [Anthem's "bad faith" and punitive damages claims]. . . .

Memorandum of Law in Support, Appellants' App'x at 620–22 (underlined emphasis added).

       [CNA] has additional defenses to coverage as set forth in its affirmative defenses and coun-
       terclaim . . . . However, these additional defenses may require further discovery before they
       are ripe for adjudication. Therefore, they have not been included in this Motion. . . . By
       moving for summary judgment on only some of its defenses, [CNA] in no way waives (and
       it specifically reserves) its right to pursue its other defenses should this Court deny this
       Motion.

Id. at 620 n.3 (emphasis added). We find that CNA specified it was "moving for summary judg-
ment on only some of its defenses" and thereby reserved its other defenses.

       Anthem argues CNA waived any additional affirmative defenses. It first claims CNA
"did not object to Anthem's request . . . for summary judgment in its favor on Counts II and III"
until this petition for rehearing. Response to Pet. for Reh'g at 1. Anthem contends CNA should
have raised this objection to the trial court. Anthem's second argument is that Trial Rule 56(B)
authorizes its requested relief because CNA's motion for summary judgment "did not request
summary judgment only as to certain specified affirmative defenses" but rather summary judg-
ment as to certain specified counts and CNA had the duty to assert its affirmative defenses in re-
sponse to Anthem's request for summary judgment in its favor. Id. at 3–4.

       Generally, an affirmative defense is waived "if not asserted in response to a motion for
summary judgment that dispose[s] of the entire issue of liability." Reiswerg v. Statom, 926
N.E.2d 26, 32 (Ind. 2010). And when a "plaintiff moves only for partial summary judgment on
an issue or an element but not as to liability, the defendant is under no obligation to present all of

                                                      3
its affirmative defenses at the summary judgment stage." Id. In the present case, however, it
was not the plaintiff Anthem but the defendant CNA who sought summary judgment and raised
some but not all of its affirmative defenses. Success as to many of these claims would have enti-
tled CNA to establish its non-liability on one or more counts of Anthem's complaint. But a de-
nial of summary judgment as to all of CNA's asserted issues does not dispose of the entire issue
of liability. The general waiver rule is thus inapplicable. For waiver of a contention to occur, it
must be "placed in issue by the movant." Id. at 33. When, as here, the defendant moves for
summary judgment and the plaintiff is the non-moving party, the defendant has no duty to raise
all of its affirmative defenses unless another moving party "has first addressed and presented evi-
dence on that element." Id. at 30 (citing Jarboe v. Landmark Cmty. Newspapers, Inc., 644
N.E.2d 118, 123 (Ind. 1994)). In the absence of a duty to raise one or more affirmative defenses,
a defendant's failure to do so cannot constitute waiver. This principle is also consistent with the
unequivocol limitation in Trial Rule 56(B) precluding courts from granting summary judgment
for a non-moving party except as to issues raised by the motion.

       We decline to find waiver of unasserted defenses by CNA in this case. As the moving
party, CNA controls the definition of the issues raised by its summary judgment motion for pur-
poses of Trial Rule 56(B). In its motion for summary judgment, CNA sought summary judg-
ment for any one of four "reasons"/"defenses" at issue, see Appellants' App'x at 620, which we
consolidated as "three principle claims." Slip opin. at 7, 29 N.E.3d at 722. See Memorandum of
Law in Support, Appellants' App'x at 620 n.3 ("[T]his Motion addresses those defenses which
are dispositive . . . ."); CNA's Reply in Support of its Motion for Summary Judgment, id. at 6013
("Each of these reasons, in and of themselves, is a complete stand alone basis for summary judg-
ment in favor of [CNA]."). Although a finding for CNA on any one of these defenses would dis-
pose of the entire issue of its liability, a finding against CNA on one defense does not necessarily
foreclose other defenses. In this context, a court could grant summary judgment to either party,
but such judgment would be limited to "the issues raised by the motion." T.R. 56(B).

       We conclude that rehearing should be granted to modify our opinion to address only the
issues raised in the summary judgment proceeding. We therefore adopt the following revisions to
our opinion:

                                                     4
1. The fifth paragraph of our opinion, slip opin. at 4–5, 29 N.E.3d at 720, is hereby modified as
follows "to clarify that [CNA's] motion for summary judgment raised only certain issues of law
prior to the close of discovery." Pet. for Reh'g at 13.

       Prior to the close of discovery, Continental Casualty Company (CNA) filed a motion for
       summary judgment, arguing in part that there was no coverage under the relevant policy
       language because the claims settled in the Underlying Litigation had not arisen out of acts
       that had occurred "solely" in Anthem's rendering of, or failure to render, professional ser-
       vices.8 The trial court agreed with that argument and several others made by CNA and,
       determining that there was no just reason for delay, both granted summary judgment on
       the issues raised by CNA and directed entry of final judgment for CNA. Anthem initi-
       ated this appeal. A few months later, the trial court granted Twin City's request to be
       joined in the final judgment order in favor of CNA on the same grounds. See Appellants'
       App'x at 6450–52; 6515. Anthem brought a separate, additional appeal from this judg-
       ment favoring Twin City.9 Consolidating Anthem's appeals, the Court of Appeals af-
       firmed on the one basis that the allegations against Anthem "did not arise 'solely,' i.e., ex-
       clusively or entirely, out of its claims handling activities . . . ." WellPoint, Inc. v. Nat'l
       Union Fire Ins. Co. of Pittsburgh, PA, No. 49A05-1202-PL-92, 989 N.E.2d 845, 2013
WL 3149002, at *7 (Ind. Ct. App. June 19, 2013) ("WellPoint II") (table).

2. The final paragraph of our opinion, titled "Conclusion," is hereby modified to read:

       We hold as a matter of law that Anthem's losses resulted from alleged wrongful acts that oc-
       curred solely in the rendering or failure to render Professional Services and thus fall
       within the Policy's insuring agreement; that the relief Anthem seeks is insurable under the
       Policy and Indiana law; and that, with respect to Anthem's settlement losses resulting from
       Shane, Thomas, and Levinson, the exception to Exclusion (b) obviates its application. An-
       them is entitled to the coverage, including coverage for defense costs, under Coverage II of
       its policies with the Excess Reinsurers, except for its settlement losses resulting from
       CSMS's claims. We reverse and, except for Anthem's losses resulting from CSMS's
       claims and Anthem's bad faith claim, enter direct the entry of summary judgment in favor
       of Anthem pursuant to Trial Rule 56(B) on the issues raised in CNA's motion for sum-
       mary judgment and decided in this opinion. We for its costs of settling the Underlying
       Litigation and remand to the trial court for further proceedings consistent with this opin-
       ion.

Our opinion in this case is modified accordingly but in all other respects remains in full force.

Rush, C.J., and Rucker, David, and Massa, JJ., concur.

                                                      5
AMICI CURIAE
IN SUPPORT OF APPELLEES' PETITION FOR
REHEARING
Professor Jeffrey O. Cooper
Indiana University Robert H. McKinney
School of Law
Indianapolis, Indiana

THE AMERICAN INSURANCE ASSOCIATION,
THE NATIONAL ASSOCIATION OF MUTUAL
INSURANCE COMPANIES, AND
THE PROPERTY CASUALTY INSURERS ASSO-
CIATION OF AMERICA
John C. Trimble
Richard K. Shoultz
Lewis Wagner, LLP
Indianapolis, Indiana

Ronald P. Schiller
Hangley Aronchick Segal Pudlin & Schiller
Philadelphia, Pennsylvania

AMERICA'S HEALTH INSURANCE PLANS
Nicole J. Webb
Squire Sanders LLP
Cincinnati, Ohio

UNITED POLICYHOLDERS
Ronald G. McLean
Ronald G. McLean Law Office
Indianapolis, Indiana

Amy R. Bach
United Policyholders
San Francisco, California