Court Opinion

ID: 6324088
Source: CourtListenerOpinion
Date Created: 2022-03-17 00:01:29.033641+00
Date Added: 2024-06-11T09:21:48.968449
License: Public Domain

Case: 21-50498     Document: 00516242060          Page: 1    Date Filed: 03/16/2022

              United States Court of Appeals
                   for the Fifth Circuit
                                                                       United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                                                        March 16, 2022
                                   No. 21-50498                          Lyle W. Cayce
                                                                              Clerk

   Vanessa St. Pierre,

                                                            Plaintiff—Appellant,

                                       versus

   Standard Insurance Company; Dearborn National Life
   Insurance Company,

                                                         Defendants—Appellees.

                  Appeal from the United States District Court
                       for the Western District of Texas
                            USDC No. 3:20-CV-257

   Before Barksdale, Stewart, and Dennis, Circuit Judges.
   Per Curiam:*
          This case arises from a dispute involving a life insurance policy.
   Appellant Vanessa St. Pierre claims that she properly acquired a dependent
   life insurance policy on behalf of her deceased husband. Standard Insurance
   Company (“Standard”) and Dearborn National Life Insurance Company

          *
            Pursuant to 5th Circuit Rule 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   opinion should not be published and is not precedent except under the limited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 Circuit Rule 47.5.4.
Case: 21-50498      Document: 00516242060          Page: 2   Date Filed: 03/16/2022

                                    No. 21-50498

   (“Dearborn”) (collectively, “Appellees”) disagreed and moved to dismiss
   St. Pierre’s claims. The district court issued a judgment in favor of Appellees
   and dismissed St. Pierre’s suit. For the following reasons, we AFFIRM.
                    I. Facts & Procedural Background
          In June 2009, the City of El Paso (the “City”) solicited offers from
   outside vendors to provide life insurance to city employees. Standard
   submitted its offer to the City, which included responses to a questionnaire.
   In that questionnaire, Standard told the City that it could send its
   representatives to open enrollment and orientation meetings “as needed,”
   would offer a one-time special open enrollment that guaranteed the issuance
   of life insurance without evidence of insurability, and a guaranteed issue
   amount of $200,000 for its voluntary life insurance policies. The City
   accepted and contracted with Standard to be its insurance underwriter in
   December 2009.
          Approximately five years later, in August 2014, St. Pierre became an
   employee for the City. She was given an Employee Benefits Summary that
   stated that all eligible employees automatically received $50,000 in life
   insurance coverage and $2,000 in dependent life insurance coverage on
   behalf of their spouse. The Summary further provided:
          Supplemental Life. Approvals up to $200,000 are guaranteed
          for new employees. After 30 days of continuous employment,
          changes can only be made with a qualifying life event or
          through Open Enrollment and subject to medical underwriting.
          Evidence of Insurability application for underwriting process
          will be required with waiting period of approximately six (6)
          weeks for an answer from carrier. Plan is age-graded term life
          policy.
          St. Pierre attended an enrollment orientation session and filled out the
   2014 Personal Enrollment Form, requesting supplemental life insurance in

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                                         No. 21-50498

   the amount of $200,000 and dependent life insurance on behalf of her
   husband in the amount of $100,000. Next to the “Dependent Life – Spouse”
   coverage term, the form stated: “Pending E of I _____.” 1 The form also
   provided:
         TO ENROLL IN OR MAKE CHANGES TO THE
         FOLLOWING PLANS (SUPPLEMENTAL LIFE,
         DEPENDENT LIFE AND SHORT TERM DISABILITY)
         YOU MUST MEET WITH A REPRESENTATIVE.
         THEY WILL BE AVAILABLE DURING THE
         ENROLLMENT SESSIONS.
   The form further provided:
         I UNDERSTAND THAT IT IS MY RESPONSIBILITY
         TO VERIFY THAT ALL PAYROLL DEDUCTIONS AS
         STATED ABOVE ARE CORRECT AND TO REPORT
         ANY DISCREPANCIES IN DEDUCTIONS ON MY
         PAYCHECK TO THE INSURANCE AND BENEFITS
         DIVISION   IMMEDIATELY   TO   GUARANTEE
         PROPER COVERAGE AND CONTRIBUTIONS.
   A Standard representative was not present at the orientation, and St. Pierre
   never met with any representative, Standard or otherwise, to confirm her
   enrollment for dependent life coverage.
         Thereafter, the City began deducting $9.00 from St. Pierre’s bi-
   weekly paycheck for “Optional Life After Tax Ded[uction].” St. Pierre
   assumed this deduction covered both her supplemental life policy and the
   dependent life policy. However, the bi-weekly $9.00 deductions covered only
   her supplemental life policy. From 2015 through 2017, St. Pierre completed

         1
             “Pending E of I” is shorthand for “Pending Evidence of Insurability.”

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   her annual re-enrollment and each year, she indicated that she wished to
   maintain her current life insurance coverage.
          In 2017, the City began negotiations with Dearborn to replace
   Standard as its life insurance underwriter. Dearborn’s “final offer” to the
   City contained the following terms:
          A one-time modified open enrollment with Life insurance
          amounts of $50,000 for employees and $20,000 for spouses up
          to the Guarantee Issue Limit. Anyone wishing coverage over
          the Guarantee Issue Limit would still need to submit evidence
          of insurability. In the event someone does not wish to change
          their elected amounts, the current amounts will be
          grandfathered.
   In November 2017, the City accepted Dearborn’s offer to replace Standard
   as its life insurance underwriter.
          During the 2018 Open Enrollment Session, St. Pierre filled out the
   enrollment form except for the life insurance and dependent life insurance
   rates because she did not know what those rates were, and the City did not
   send her a rate sheet. St. Pierre then told the human resources representative
   that she wanted to keep the same life insurance coverages that she previously
   had. Consequently, St. Pierre continued to have $200,000 in supplemental
   life insurance and no additional supplemental dependent life insurance.
          On August 31, 2018, St. Pierre’s husband passed away. She called the
   City’s human resources benefits department to claim the dependent life
   insurance proceeds and learned that she did not have dependent coverage.
   The City offered to settle St. Pierre’s claim for $20,000 but she declined.
   St. Pierre then submitted her claim directly to Dearborn, at its insistence.
   Upon receiving her claim, Dearborn sent St. Pierre a $2,000 check—the
   minimum amount of dependent life insurance for employees who did not
   elect for higher coverage. Dearborn then sent St. Pierre a letter informing her

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                                    No. 21-50498

   that her claim for supplemental dependent coverage was rejected because she
   had failed to submit evidence of insurability.
          St. Pierre first sued Dearborn and the City, but voluntarily dismissed
   her claims against the City. In her suit against Dearborn, St. Pierre argued
   that it violated the Texas Insurance Code and the Deceptive Trade Practices
   Act (“DTPA”). She also alleged that the City acted as an agent of Dearborn
   under Texas Insurance Code § 4001.003(1), making Dearborn liable for the
   City’s actions. Finally, she alleged that Dearborn was estopped from denying
   coverage because it “implicitly promised the City that” it would not engage
   in any Texas Insurance Code or DTPA violations. The district court
   dismissed St. Pierre’s suit without prejudice on grounds that the City could
   not act as Dearborn’s agent under the Texas Insurance Code.
          St. Pierre then filed a second lawsuit against Dearborn and Standard,
   advancing claims both as a consumer of the policy and as a third-party
   beneficiary of the contracts between the City and Appellees. This time,
   St. Pierre claimed that the City acted as an agent for Appellees under Texas
   common law, rather than the Texas Insurance Code. She then alleged that
   Appellees engaged in deceptive practices in violation of the Texas Insurance
   Code and the DTPA because (1) Appellees made false and misleading
   statements to the City; and (2) Appellees (themselves and through the City)
   failed to disclose information regarding the evidence-of-insurability
   requirement and pay-deduction rates. St. Pierre also brought a promissory
   estoppel claim alleging that Appellees were estopped from denying her
   coverage based on their promises to the City. Finally, she brought a breach-
   of-contract claim against Dearborn on grounds that it allowed her to be
   “victimized by ‘inadvertent clerical errors or omissions.’”
          Appellees moved to dismiss St. Pierre’s claims, and the district court
   granted their motion. In a detailed 26-page opinion, the district court first

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   determined that the City could not act as Appellees’ agent under common
   law. It then concluded that St. Pierre failed to state any viable claims against
   Appellees under the Texas Insurance Code or the DTPA because (1) she did
   not allege that Appellees ever misrepresented the benefits of the insurance
   policy to the City and/or (2) she did not allege that she reasonably relied to
   her detriment on Standard’s representations to the City. Similarly, the
   district court held that St. Pierre failed to state a promissory estoppel claim
   because (1) she did not allege a promise by Appellees to the City upon which
   she could reasonably rely; and (2) even if there was such a promise, she did
   not allege that she reasonably relied on it. Finally, the district court explained
   that the breach-of-contract claim failed because St. Pierre did not allege
   conduct by Dearborn that breached any term of the insurance contract. This
   appeal ensued.
          On appeal, St. Pierre argues that (1) the district court erred by
   concluding that the City could not act as a common-law agent of Appellees,
   because it “plac[ed] upon Ms. St. Pierre the burden of negating the unpled
   and disputed affirmative defense that the Texas Insurance Code preempted
   Texas common law”; and (2) the district court did not properly apply the
   pleading standard because it failed to read all factual allegations in her favor
   and improperly required a “linkage between the presumptively true
   statements of fact and the causes of action.”
                           II. Standard of Review
          We review a district court’s dismissal of a complaint for failure to state
   a claim de novo. See FED. R. CIV. P. 12(b)(6); Innova Hosp. San Antonio,
   L.P. v. Blue Cross & Blue Shield of Ga., Inc., 892 F.3d 719, 726 (5th Cir. 2018).
   We must “accept all well-pleaded facts as true and view those facts in the
   light most favorable to the plaintiff.” Richardson v. Axion Logistics, L.L.C.,
   780 F.3d 304, 304-05 (5th Cir. 2015) (quoting Montoya v. FedEx Ground

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Case: 21-50498        Document: 00516242060             Page: 7      Date Filed: 03/16/2022

                                        No. 21-50498

   Package Sys., Inc., 614 F.3d 145, 146 (5th Cir. 2010)). But we need not accept
   as true a legal conclusion unsupported by fact. Ashcroft v. Iqbal, 556 U.S. 662,
   678 (2009). Thus, to survive a motion to dismiss, a complaint must contain
   sufficient factual matter that, when taken as true, “state[s] a claim to relief
   that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
   (2007).
                                    III. Discussion
           We first address St. Pierre’s agency argument. Then, we turn to her
   argument that the district court misapplied the pleading standard.
                                              A.
           St. Pierre contends that the district court erred by finding that the City
   could not act as a common-law agent of Appellees, because it placed upon
   her “the burden of negating the unpled and disputed affirmative defense that
   the Texas Insurance Code preempted Texas common law.” We disagree. A
   court need not, and should not, accept as true any legal conclusion that a
   plaintiff puts forward. Iqbal, 556 U.S. at 678. Here, the Texas Insurance Code
   plainly states that, for the purposes of the Code, “Agent” excludes “an
   employer . . . to the extent . . . [it] is engaged in the administration or
   operation of an employee benefits program.” TEX. INS. CODE
   § 4001.003(1)(B). Because of this provision, St. Pierre’s first action against
   Dearborn was dismissed. Now, in an attempt to avoid a similar ruling, she
   claims that an employer can still be an agent of an insurer when administering
   an employee benefits program under common law. She cites no common law
   to support this contention, however, because there is no such law. 2 Thus, the

           2
            St. Pierre submits various pre-Insurance Code cases, and none since the Code
   was enacted, where Texas courts did consider employers agents of insurers for the purpose

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                                       No. 21-50498

   district court properly concluded that the City did not act as an agent for
   Appellees under common law.
                                             B.
          Because the actions of the City cannot be imputed onto Appellees,
   St. Pierre must have alleged facts regarding Appellees’ own actions that
   support her claims. She has failed to do so.
          A. Texas Insurance Code and Deceptive Trade Practices Act
          St. Pierre alleges that Appellees made misrepresentations and
   wrongful omissions to both the City and herself that violated various
   provisions of the Texas Insurance Code and the DTPA. But her factual
   allegations do not include any misrepresentations or wrongful omissions
   regarding the supplemental dependent life insurance she sought. Moreover,
   to state a claim under the Texas Insurance Code and the DTPA, she must
   allege that the wrongful act or practice was the “producing cause” of her
   damages. See First Am. Title Co. of El Paso v. Prata, 783 S.W.2d 697, 701 (Tex.
   App.—El Paso 1989); Cruz v. Andrews Restoration, Inc., 364 S.W.3d 817, 823
   (Tex. 2012) (“The DTPA authorizes consumer suits when deceptive acts are
   the producing cause of ‘[actual damages].’” (internal quotation marks
   omitted)). St. Pierre has failed to show how Standard’s statements to the
   City in 2009, of which she was unaware when she applied for the dependent
   life policy, caused her harm in 2014. Accordingly, she has failed to state a
   claim under the Texas Insurance Code or the DTPA.
          B. Promissory Estoppel

   of deducting premiums. If anything, these cases demonstrate the effect of the Insurance
   Code in halting that treatment.

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                                          No. 21-50498

           St. Pierre next claims that Appellees are estopped from denying the
   requested coverage because they misled the City into believing “that they
   would provide the necessary support to inform employees of their rights and
   obligations.” Again, her argument fails.
           Under Texas law, promissory estoppel requires “evidence of (1) a
   promise, (2) foreseeability of reliance, (3) actual, substantial, and reasonable
   reliance by the promisee to his or her detriment, and (4) that failure to
   enforce the promise would result in an injustice.” Comiskey v. FH Partners,
   LLC, 373 S.W.3d 620, 635 (Tex. App.—Hous. 2012). A promise “must be
   more than mere speculation concerning future events”; rather, it must be
   “sufficiently specific and definite.” Id.
           Here, the promise is an implicit one to “provide the necessary support
   to inform employees of their rights and obligations,” and thus lacks the
   requisite specificity. But cf. Corpus Christi Day Cruise, LLC v. Christus Spohn
   Health Sys. Corp., 398 S.W.3d 303, 306 (Tex. App.—Corpus Christi 2012)
   (promise was one to pay a particular medical expense); Walker v. Walker, 631
   S.W.3d 259, 264-65 (Tex. App.—Hous. 2020) (promise was one to transfer
   land-ownership interests). Moreover, St. Pierre could not have relied on this
   “promise” since she was unaware of it. 3
           C. Breach of Contract
           Finally, St. Pierre contends that Dearborn breached its contract
   because the policy it issued promised that employees “would not be
   victimized by ‘inadvertent clerical errors or omissions.’” Indeed, the policy

           3
            St. Pierre contends she relied instead on the “good faith of her employer as de
   facto agent of [Appellees],” but as discussed supra, the City was not their agent. Even if
   she could so rely, she was expressly told that she needed to meet with a representative,
   which she did not, and that it was her responsibility to confirm that the payroll deductions
   were correct, which she failed to do.

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   provides: “Clerical error or omission by [Dearborn] to [the City] will not . . .
   [p]revent an Employee from receiving coverage, if he is entitled to coverage
   under the terms of the Policy.” But St. Pierre has not alleged any facts to
   support her claim that Dearborn ever breached this term. At best, she alleges
   that the City or Standard made a clerical error by not informing her that her
   dependent life policy application was denied, but their actions cannot be
   imputed onto Dearborn. Thus, her breach of contract claim also fails.
                                IV. Conclusion
          For the foregoing reasons, the district court’s judgment dismissing St.
   Pierre’s claims against Appellees is AFFIRMED.

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