Court Opinion

ID: 6221336
Source: CourtListenerOpinion
Date Created: 2022-02-14 13:03:09.124977+00
Date Added: 2024-06-11T08:57:21.611926
License: Public Domain

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     RICHARD T. O’DONNELL v. AXA EQUITABLE
           LIFE INSURANCE COMPANY
                    (AC 44215)
                         Moll, Cradle and Bishop, Js.

                                   Syllabus

The plaintiff brought a putative class action seeking to recover damages
    from the defendant, an insurance company organized under New York
    law, for its alleged breach of contract. The plaintiff and the other putative
    class members had purchased variable annuity policies from the defen-
    dant. The plaintiff alleged that the defendant had breached its contract
    with him and the other putative class members by changing the invest-
    ment strategy associated with their policies without seeking approval
    from the New York State Department of Financial Services (NYDFS),
    as required by the terms of the contract and New York law. The defendant
    filed a motion to strike the original complaint, which the trial court
    granted. The trial court concluded that the plaintiff had failed to ade-
    quately allege that the defendant’s actions caused him damages because
    he did not allege that the NYDFS would have prevented the defendant
    from implementing the new investment strategy had it known the full
    extent of the changes that the new investment strategy would make to
    the annuity policies. The plaintiff then filed an amended complaint
    pursuant to the applicable rule of practice (§ 10-44). The defendant filed
    a motion for entry of judgment or, alternatively, to strike the sole count
    of the amended complaint. In granting the defendant’s motion, the trial
    court concluded that, despite certain new allegations, the plaintiff’s
    amended complaint was not materially different from the original com-
    plaint and, therefore, the plaintiff had failed to file a new pleading within
    the meaning of Practice Book § 10-44. The trial court rendered judgment
    for the defendant, from which the plaintiff appealed to this court. Held:
1. The trial court improperly concluded that the plaintiff’s amended com-
    plaint was not materially different from his original complaint: when
    viewed in the light most favorable to the plaintiff, the new allegations
    set forth in the plaintiff’s amended complaint constituted a good faith
    effort to plead causation and address the legal insufficiency of the
    original complaint identified by the trial court, as there were significant
    factual additions describing the defendant’s new investment strategy,
    how it was implemented, and how it allegedly caused the plaintiff dam-
    ages in specified amounts, independent of anything the NYDFS did or
    did not do.
2. This court, having determined that the amended complaint was materially
    different from the original complaint and, therefore, that the plaintiff
    had not waived his right to appeal that ruling, concluded that the trial
    court improperly granted the defendant’s motion to strike the amended
    complaint: the plaintiff alleged facts sufficient to state a cause of action
    for breach of contract, as he included in his amended complaint, among
    other things, facts describing how the defendant’s breach allegedly
    caused him damages, and, therefore, whether the plaintiff could prove
    causation was a question for the finder of fact.
      Argued October 12, 2021—officially released February 15, 2022

                             Procedural History

  Action to recover damages for the defendant’s alleged
breach of contract, and for other relief, brought to the
Superior Court in the judicial district of New Haven,
where the case was transferred to the judicial district
of Stamford-Norwalk; thereafter, the court, Lee, J.,
granted the defendant’s motion to strike the plaintiff’s
original complaint; subsequently, the court, Hon.
Charles T. Lee, judge trial referee, granted the defen-
dant’s motion for judgment on the plaintiff’s amended
complaint, and rendered judgment thereon for the
defendant, from which the plaintiff appealed to this
court. Reversed; further proceedings.
  David A. Slossberg, with whom were Sara A. Sharp,
and, on the brief, Daniella Quitt, pro hac vice, for the
appellant (plaintiff).
  Jay B. Kasner, pro hac vice, with whom were Kurt
Wm. Hemr, pro hac vice, John W. Cerreta and Thomas
D. Goldberg, for the appellee (defendant).
                          Opinion

   BISHOP, J. In this putative class action, the plaintiff,
Richard T. O’Donnell, appeals from the judgment of the
trial court rendered after it granted the motion filed by
the defendant, AXA Equitable Life Insurance Company,1
for entry of judgment on the plaintiff’s stricken com-
plaint. On appeal, the plaintiff claims that the court
improperly concluded that his amended complaint (1)
was not ‘‘materially different’’ from his original com-
plaint and (2) failed to adequately allege that the defen-
dant’s actions caused him damages.2 We agree with the
plaintiff, and, accordingly, we reverse the judgment of
the trial court.
   The plaintiff alleges the following facts in his
amended complaint. The plaintiff is a resident of the
state of Connecticut. The defendant is a company orga-
nized under New York law with its principal place of
business also in New York. The defendant is authorized
to do and does business in Connecticut. The defendant
offers a broad portfolio of life insurance products and
a variety of annuity products, including fixed deferred
annuities, payout annuities, and variable annuities. A
variable annuity, the product at issue in the present
action, is a contract between the purchaser, also known
as the ‘‘annuitant,’’ and the insurance company. Pursu-
ant to the contract, the insurance company agrees to
make periodic payments to the annuitant, beginning
either immediately or at some future date. The defen-
dant’s annuity policies permitted the policyholders to
allocate their premiums toward various investment
options, each with different risk-reward characteristics.
   In November, 2008, the plaintiff purchased a variable
annuity policy from the defendant. The policy that the
plaintiff and other putative class members purchased
permitted them to acquire, for an additional premium,
a guarantee that certain benefits would increase by a
minimum percentage each year.3 The policy also
included a reset provision, which provided that the
value of guaranteed benefits could only increase and
never decrease. The guarantee, in combination with the
reset provision, effectively immunized the benefits of
the policy from the risks of stock market volatility.
The policy also provided that the defendant (1) would
comply with all applicable laws, (2) had established
and would maintain the accounts under New York law,
(3) would not change the investment strategy for the
variable annuity policy unless approved by the Superin-
tendent of Insurance of New York State (superinten-
dent) or deemed approved in accordance with such law
or regulation, and (4) would not make a material change
to the policy without prior approval of the superinten-
dent. Although the policy did grant the defendant some
discretion over investment options, it did not permit the
defendant to make material changes to the investment
strategy without complying with applicable New
York law.
   In 2011, after the plaintiff had already purchased his
annuity policy from the defendant, the defendant
changed the investment strategy associated with the
plaintiff’s and other putative class members’ policies.
The defendant implemented the new investment policy,
referred to as the ‘‘AXA Tactical Manager Strategy’’
(ATM Strategy), without seeking approval from the New
York State Department of Financial Services (NYDFS),
as required by the terms of the contract and New York
law. The ATM Strategy was a material change to the
investment policy pursuant to New York Insurance Law
§ 4240 (e),4 which required the defendant to seek
approval of the change from the NYDFS prior to its
implementation. Under § 4240 (e), an amendment that
changes the investment strategy is not automatically
approved but, rather, is treated as an original filing.
An amendment that does not change the investment
strategy is automatically deemed approved after thirty
days, unless the superintendent disapproves. Because
the defendant did not properly inform the NYDFS of
the nature of the changes and that the changes should
be treated as an original filing, the ATM Strategy was
automatically, but improperly, deemed approved. By
not seeking the requisite approval from the NYDFS, the
defendant breached the terms of the contract.
   The plaintiff also alleged the following facts. The
breach caused the plaintiff and other policyholders
damages. To implement the ATM Strategy, the defen-
dant sold all or substantially all of the plaintiff’s and
other policyholders’ investment positions without their
permission. This left the plaintiff’s and other policyhold-
ers’ accounts with no equity exposure. After the market
recovered, the defendant bought these positions back at
much higher prices, immediately resulting in substantial
losses passed on to the plaintiff and other policyholders.
In other words, alleged the plaintiff, the ATM Strategy
reduced the defendant’s risks and costs by using deriva-
tives to hedge its own equity exposure to market volatil-
ity at the expense of the variable annuity customers who
purchased their policies, in part, for the opportunity to
benefit from market volatility. The ATM Strategy altered
the very nature of the product held by policyholders.
It materially changed the variable annuity products and
reduced the value of the annuity accounts. The reduc-
tion of the value of the accounts also diminished the
periodic reset amounts built into the policies. In the
case of the plaintiff, the defendant’s breach cost him
approximately $90,000, or almost 20 percent of his origi-
nal investment. The members of the putative class lost
in excess of $100 to $200 million dollars during the
relevant period.
  Soon after the defendant’s implementation of the
ATM Strategy, the NYDFS commenced an investigation
of the defendant concerning the implementation of the
ATM Strategy. The focus of the investigation was
whether the defendant had properly informed the
NYDFS of the implementation of the ATM Strategy.
After the conclusion of the investigation, the NYDFS
found that the defendant had failed to seek the requisite
approval for the material changes to the investment
strategy under the ATM Strategy. Specifically, the
NYDFS found that while the ATM Strategy effectively
changed the nature of the product the policyholders
had purchased, the defendant failed to explain in its
filings with the NYDFS that it was making such changes
to the policies. The absence of detail and discussion in
the filings regarding the significance of the implementa-
tion of the ATM Strategy had the effect of misleading
the NYDFS regarding the scope and potential effects
of the changes. The NYDFS had approved the filings
on the false belief that the changes were merely routine
additions of funds or similar alterations. As a result,
the defendant entered into a consent order with the
NYDFS on March 14, 2014.5 According to the consent
order, ‘‘[h]ad the [NYDFS] been aware of the extent
of the changes, it may have required that the existing
policyholders affirmatively opt in to the ATM Strategy.’’
The consent order required the defendant to (1) pay
$20 million to the NYDFS, (2) seek all necessary approv-
als in connection with the ATM Strategy in the future,
and (3) issue written reports to the NYDFS concerning
changes to certain accounts on a quarterly basis for a
period of five years from the date of the consent order.
   The plaintiff commenced this putative class action
against the defendant on August 21, 2015. In his com-
plaint, the plaintiff asserted a single claim for breach
of contract against the defendant. On December 27,
2018, the defendant filed both a motion to strike the
sole count of the plaintiff’s complaint and a motion to
dismiss the plaintiff’s complaint to the extent that it
purported to assert claims on behalf of members of a
putative class who are not Connecticut residents. The
court heard oral argument on the two motions on May
6, 2019.
   The court granted the defendant’s motion to strike,
concluding that ‘‘the causation of damages the plaintiff
has alleged for his breach of contract claim are specula-
tive, and that, as a result, his complaint fails to plead
facts that sufficiently allege the causation element of
his breach of contract claim.’’ The plaintiff then filed
an amended complaint pursuant to Practice Book § 10-
44.6 The defendant filed a motion for entry of judgment,
or alternatively, to strike the sole count of the amended
complaint. After hearing oral argument on the defen-
dant’s motion, the court granted the defendant’s motion
for entry of judgment and rendered judgment in favor
of the defendant. This appeal followed. Additional facts
and procedural history will be set forth as necessary.
  We begin by setting forth the applicable principles
of law and standard of review that guide our analysis.
‘‘Our review of the court’s ruling on the defendant[’s]
motion to strike is plenary.’’ St. Denis v. de Toledo, 90
Conn. App. 690, 694, 879 A.2d 503, cert. denied, 276
Conn. 907, 884 A.2d 1028 (2005). ‘‘In ruling on a motion
to strike, we take the facts alleged in the complaint as
true.’’ Id., 691. ‘‘After a court has granted a motion
to strike, the plaintiff may either amend his pleading
[pursuant to Practice Book § 10-44] or, on the rendering
of judgment, file an appeal. . . . The choices are mutu-
ally exclusive [as] [t]he filing of an amended pleading
operates as a waiver of the right to claim that there
was error in the sustaining of the [motion to strike] the
original pleading. . . . If the allegations in [the plain-
tiff’s] substitute complaint are not materially different
from those in his original complaint . . . the waiver
rule applies, and the plaintiff cannot now challenge
the merits of the court’s ruling striking the amended
complaint.’’ (Citations omitted; internal quotation
marks omitted.) Id., 693–94; see also Lund v. Milford
Hospital, Inc., 326 Conn. 846, 851, 168 A.3d 479 (2017)
(‘‘if the allegations in a complaint filed subsequent to
one that has been stricken are not materially different
than those in the earlier, stricken complaint, the party
bringing the subsequent complaint cannot be heard to
appeal from the action of the trial court striking the
subsequent complaint’’ (internal quotation marks omit-
ted)). In short, by filing an amended complaint, a plain-
tiff is said to have waived the right to appeal from the
court’s order striking the original complaint.
   ‘‘If the plaintiff elects to replead following the grant-
ing of a motion to strike, the defendant may take advan-
tage of this waiver rule by challenging the amended
complaint as not materially different than the [stricken]
. . . pleading that the court had determined to be
legally insufficient. That is, the issue [on appeal
becomes] whether the court properly determined that
the [plaintiff] had failed to remedy the pleading deficien-
cies that gave rise to the granting of the [motion] to
strike or, in the alternative, set forth an entirely new
cause of action. It is proper for a court to dispose of
the substance of a complaint merely repetitive of one to
which a demurrer had earlier been sustained.’’ (Internal
quotation marks omitted.) Lund v. Milford Hospital,
Inc., supra, 326 Conn. 850. If the amended complaint
is not materially different, the court properly granted
the motion to strike and the plaintiff is then bound by
the court’s judgment striking the amended complaint.
See Parker v. Ginsburg Development CT, LLC, 85 Conn.
App. 777, 782, 859 A.2d 46 (2004) (holding that amended
complaint was not materially different, binding plaintiff
to court’s judgment striking amended complaint).
   ‘‘However, there is an exception to the waiver rule.
If the plaintiff pleads facts in the substitute complaint
which are ‘materially different’ from those in the origi-
nal complaint, then the waiver rule does not apply.’’
Id., 780. When the waiver rule does not apply, the plain-
tiff can challenge the merits of the court’s ruling striking
the amended complaint. See Parsons v. United Technol-
ogies Corp., 243 Conn. 66, 76, 700 A.2d 655 (1997)
(reaching merits of court’s ruling striking amended
complaint after concluding waiver rule did not apply).
                             I
   The plaintiff first claims that the trial court improp-
erly concluded that his amended complaint was not
‘‘materially different’’ from his original complaint and,
therefore, that he had failed to file a new pleading within
the meaning of Practice Book § 10-44. Specifically, the
plaintiff claims that the court erred by applying the
wrong legal standard in its review of the amended com-
plaint, causing it to conclude that the amended com-
plaint was not ‘‘materially different’’ from the original
complaint. The plaintiff claims that the changes in the
amended complaint are material because they reflect
his good faith effort to cure the causation defect identi-
fied by the court in striking the original complaint.
We agree.
   ‘‘The law in this area requires the court to compare
the two complaints to determine whether the amended
complaint advanced the pleadings by remedying the
defects identified by the trial court in granting the ear-
lier motion to strike. . . . In determining whether the
amended pleading is ‘materially different,’ we read it
in the light most favorable to the plaintiff.’’ (Citation
omitted; footnote omitted; internal quotation marks
omitted.) Lund v. Milford Hospital, Inc., supra, 326
Conn. 851.
   To determine whether the amended complaint was
‘‘materially different’’ from the original complaint, ‘‘we
first examine the ruling striking the first . . . com-
plaint.’’ St. Denis v. de Toledo, supra, 90 Conn. App.
694. In the ruling in the matter at hand, the court held
that the complaint alleged insufficient facts to support
the requisite element of causation. The court concluded
that the causation of damages the plaintiff allegedly
suffered was speculative. The court found the present
case similar to Meadowbrook Center, Inc. v. Buchman,
149 Conn. App. 177, 193, 90 A.3d 219 (2014) (Mead-
owbrook), because, according to the court, the plaintiff
based his damages on what the NYDFS may have done
had the defendant adequately informed it about and
explained the significance of the changes the ATM Strat-
egy made to the annuity policies. The court explained
that the plaintiff did not allege that, had the NYDFS
known the full extent of the changes that the ATM
Strategy made, it would have prevented the defendant
from implementing it. Therefore, the plaintiff could not
rely on what the NYDFS may have done in order to
plead causation. The court concluded ‘‘that the plain-
tiff’s breach of contract claim fails as a matter of law
because he has failed to adequately allege that the
defendant’s actions caused him damages.’’ It is clear
from the court’s ruling that the defect it identified in
striking the original complaint was that the complaint
alleged insufficient facts to support the requisite ele-
ment of causation, specifically, that the defendant’s
actions caused the plaintiff damages.
   In the ruling that is the subject of this appeal, the
court reviewed the amended complaint and ultimately
concluded that it was not ‘‘materially different from the
original complaint’’ and was not a ‘‘ ‘new pleading’ ’’
within the meaning of Practice Book § 10-44. The plain-
tiff argues that the court improperly concluded that the
amended complaint was not ‘‘materially different’’ from
the original complaint ‘‘based solely on its finding that
the plaintiff’s new allegations failed to cure the defect
identified by the trial court in striking the original com-
plaint.’’ (Emphasis added.) The plaintiff argues that
‘‘[u]nder the proper legal standard, however, the fact
that changes contained in an amended pleading fail to
successfully cure an earlier defect does not determine
the materiality of such changes. . . . [C]hanges in an
amended pleading are material if they reflect a good
faith effort to file a complaint that states a cause of
action in a manner responsive to the defects identified
by the trial court in its grant of the motion to strike
the earlier pleading.’’ (Emphasis in original; internal
quotation marks omitted.) The plaintiff contends that
‘‘the amended complaint reflects [a] good faith effort
to remedy the defect previously identified by the trial
court in striking the original complaint’’ because the
amended complaint ‘‘included new facts intended to
render his claim legally sufficient by providing further
support for his allegation that the defendant’s unlawful
implementation of the ATM strategy resulted in [his]
damages.’’ We agree with the plaintiff.
   Our Supreme Court has explained that ‘‘[c]hanges in
the amended pleading are material if they reflect a good
faith effort to file a complaint that states a cause of
action in a manner responsive to the defects identified
by the trial court in its grant of the motion to strike
the earlier pleading. . . . Factual revisions or additions
are necessary; mere rewording that basically restate[s]
the prior allegations is insufficient to render a complaint
new following the granting of a previous motion to
strike. . . . The changes in the allegations need not,
however, be extensive to be material.’’ (Citations omit-
ted; internal quotation marks omitted.) Lund v. Milford
Hospital, Inc., supra, 326 Conn. 852–53, citing, inter
alia, Parsons v. United Technologies Corp., supra, 243
Conn. 75–76.
  On the basis of our review of the decision striking
the original complaint and the plaintiff’s amended com-
plaint, we conclude that the changes are materially dif-
ferent.
  The plaintiff’s amended complaint includes the fol-
lowing relevant additions to the original complaint:
‘‘[The] [d]efendant, in breach of the express language
of its contract with the plaintiff, took exclusive control
of the plaintiff’s investment portfolio and sold all or
substantially all of the plaintiff’s entire equity portfolio
for its exclusive benefit and to the extreme financial
detriment of the plaintiff. . . . When [the defendant]
implemented the ATM Strategy in 2011, [the defendant]
sold all or substantially all of the plaintiff’s and the
other variable annuity policyholders’ investment posi-
tions without their permission. Later in 2011, after the
market rallied, [the defendant] then bought these posi-
tions back at much higher prices. . . . [The] plaintiff
and other policyholders suffered large losses . . . .
Soon after [the defendant’s] implementation of the ATM
Strategy in 2011, and in the face of the resulting losses
suffered by policyholders, the [NYDFS] commenced its
investigation into [the defendant].
                           ***
   ‘‘The mechanics of the implementation of the ATM
Strategy were the following: [The defendant] sold the
equivalent of all of the equity securities in the plaintiff’s
investment account by means of selling matching S&P
500 futures contracts. This left the plaintiff’s account
with no equity exposure. When [the defendant]
repurchased the S&P 500 futures contracts, it did so
at a higher price, immediately resulting in substantial
losses passed onto the plaintiff and other similarly situ-
ated policyholders. In summary, [the defendant] used
the ATM Strategy to hedge its equity exposure and pass
on the losses to its clients. By way of example, in the
case of the plaintiff, [the defendant’s] actions in liquidat-
ing his equity exposure cost him approximately $90,000,
or almost 20 [percent] of his original investment. The
class lost in excess of $100 to $200 million during the
relevant period. . . . Shortly thereafter, [the defen-
dant] ceased using the ATM Strategy in the policies
purchased by the class members. . . . Unfortunately,
by the time the NYDFS commenced its investigation,
the plaintiff’s and other policyholders’ non-speculative
losses were etched in stone. . . . As discussed above,
the NYDFS issued the consent order regarding its inves-
tigation into [the defendant’s] implementation of the
ATM Strategy on March 17, 2014. . . . As the ATM
Strategy was no longer being applied to any existing
policies at that time, the [NYDFS’] findings under the
consent order were directed towards [the defendant’s]
future implementation of the ATM Strategy. . . . In the
consent order, the NYDFS required [the defendant] to
agree, at minimum, to seek all necessary approvals with
regard to New York Insurance Law § 4240 (e) and pro-
vide [NYDFS]-approved communications to policyhold-
ers when revising fund choices in connection with the
ATM Strategy in the future. . . . In addition, the
NYDFS required [the defendant] to issue a written
report to [the NYDFS] concerning changes to the plan
of operations for separate accounts A, 45, and 49 and
respond to the [NYDFS’] questions thereon on a quar-
terly basis for a period of five years. . . . Although
the market conditions which triggered [the defendant’s]
initial use of the ATM Strategy reoccurred, [the defen-
dant] has never sought approval from the NYDFS to
use the ATM Strategy again in the manner in which it
was used in 2011. The ATM Strategy has not been used
in connection with separate accounts A, 45, and 49
since the NYDFS commenced its investigation in 2011.
. . . Nevertheless, the damages suffered by the plaintiff
and policyholders which resulted from [the defendant’s]
unlawful implementation of the ATM Strategy in 2011
had already been incurred. . . . Had [the defendant]
sought to use the ATM Strategy again, it would have
been required to, at minimum, provide policyholders
with notice via communications approved by the
NYDFS prior to implementing the ATM Strategy.’’
(Internal quotation marks omitted.)
   Despite these additions, the trial court concluded that
the amended complaint was not materially different
from the original complaint because the new allegations
failed to address what the court viewed as the essential
failing of the original complaint, namely, that causation
was ‘‘premised on speculation as to what the regulatory
body might have done with respect to the changes in
the variable annuity policy at issue.’’
   Factual additions, even if limited, can be read as an
attempt to address the defect identified by the trial court
in striking the plaintiff’s original complaint. Parsons v.
United Technologies Corp., supra, 243 Conn. 74–75
(only difference between original complaint and
amended complaint was addition of specific location
in Bahrain to which plaintiff was to be sent for employ-
ment, which addressed defect in original complaint).
Furthermore, ‘‘adding statutory and constitutional ref-
erences, even if inapposite, may be read as attempting
to address the legal insufficiency specifically identified
by the trial court . . . making the count materially dif-
ferent.’’ (Internal quotation marks omitted.) Lund v.
Milford Hospital, Inc., supra, 326 Conn. 854 n.7, citing
Emerick v. Kuhn, 52 Conn. App. 724, 734, 737 A.2d 456,
cert. denied, 249 Conn. 929, 738 A.2d 653, cert. denied,
528 U.S. 1005, 120 S. Ct. 500, 145 L. Ed. 2d 386 (1999).
Additional language can reflect a good faith effort to
remedy the defect identified by the court in striking the
original complaint. See Doe v. Marselle, 38 Conn. App.
360, 365, 660 A.2d 871 (1995) (despite failing to include
word ‘‘wilful’’ in amended complaint after being alerted
to defect, additional language sufficient to demonstrate
good faith effort), rev’d on other grounds, 236 Conn.
845, 675 A.2d 835 (1996). However, merely reiterating
or rewording the same allegations in the amended com-
plaint as in the original complaint does not reflect a
good faith effort to address the defect identified in the
original complaint and, therefore, does not constitute
a material change. See, e.g., St. Denis v. de Toledo,
supra, 90 Conn. App. 696.
   The plaintiff’s amended complaint does more than
merely reiterate the facts alleged in the original com-
plaint. There are significant factual additions describing
how the defendant’s actions caused the plaintiff dam-
ages apart from whatever action the NYDFS may or
may not have taken, and these allegations attempt to
address the legal insufficiency identified by the trial
court. Specifically, the amended complaint includes
new facts describing the defendant’s ATM Strategy, how
it was implemented, and how it allegedly caused the
plaintiff damages in specified amounts. The amended
complaint contains factual additions that allege that,
pursuant to the ATM Strategy, the defendant ‘‘sold the
equivalent of all of the equity securities in the plaintiff’s
investment account’’ by selling certain futures contracts
that ‘‘left the plaintiff’s account with no equity expo-
sure.’’ According to the amended complaint, the defen-
dant then repurchased those futures contracts ‘‘at a
higher price, immediately resulting in substantial losses
passed onto the plaintiff and other similarly situated
policyholders.’’ The amended complaint then alleges
that, ‘‘[i]n summary, [the defendant] used the ATM Strat-
egy to hedge its equity exposure and pass on the losses
to its clients. By way of example, in the case of the
plaintiff, [the defendant’s] actions in liquidating his
equity exposure cost him approximately $90,000 or
almost 20 [percent] of his original investment. The
[putative] class lost in excess of $100 to $200 million
during the relevant period.’’ These additions seek to
explain, in more detail, how the defendant’s actions,
independent of anything the NYDFS did or did not do,
caused the plaintiff damages.
   We conclude that, when viewed in the light most
favorable to the plaintiff, the new allegations set forth
in the plaintiff’s amended complaint ‘‘constitute a good
faith effort’’; (internal quotation marks omitted) Lund
v. Milford Hospital, Inc., supra, 326 Conn. 857; to plead
causation and, accordingly, the amended complaint is
materially different from the original complaint.
                             II
   Because we conclude that the amended complaint is
materially different from the original complaint and,
therefore, the waiver rule does not apply, we address
the plaintiff’s challenge to the merits of the court’s
ruling striking the amended complaint. See Parsons
v. United Technologies Corp., supra, 243 Conn. 75–76
(‘‘The plaintiff appears to have made a good faith effort
to file a complaint that states a cause of action. We are
persuaded, accordingly, that by failing to appeal the
striking of the [original] complaint, the plaintiff has not
waived his right to appeal from the merits of the motion
to strike . . . his [amended] complaint.’’); see also
Lund v. Milford Hospital, Inc., supra, 326 Conn. 858
(‘‘The new allegations in the substitute complaint . . .
materially differ from those in the original complaint
for purposes of preserving the plaintiff’s right to appeal
after repleading pursuant to Practice Book § 10-44.
Accordingly, we reach the merits of the plaintiff’s claims
on appeal.’’).
   The plaintiff claims that the court improperly deter-
mined that the amended complaint failed to sufficiently
plead causation. Specifically, the plaintiff claims that
the court erred by (1) applying the wrong legal standard
in concluding that the plaintiff’s amended complaint
failed to adequately plead causation and (2) relying
upon findings of fact at the pleading stage. We agree.
   In Connecticut, the complaint must ‘‘contain a con-
cise statement of the facts constituting the cause of
action . . . .’’ Practice Book § 10-20.7 ‘‘ ‘Connecticut is
a fact pleading jurisdiction . . . .’ White v. Mazda
Motor of America, Inc., 313 Conn. 610, 626, 99 A.3d
1079 (2014). Therefore, a pleading must ‘contain a plain
and concise statement of the material facts on which
the pleader relies, but not of the evidence by which
they are to be proved . . . .’ Practice Book § 10-1.8 The
purpose of fact pleading is to put the defendant and
the court on notice of the important and relevant facts
claimed and the issues to be tried.’’ (Footnote added;
internal quotation marks omitted.) Godbout v. Atta-
nasio, 199 Conn. App. 88, 111–12, 234 A.3d 1031 (2020).
‘‘A motion to strike shall be used whenever any party
wishes to contest: (1) the legal sufficiency of the allega-
tions of any complaint, counterclaim or cross claim, or
of any one or more counts thereof, to state a claim
upon which relief can be granted . . . .’’ Practice Book
§ 10-39 (a).
   ‘‘Whether the court applied the proper legal standard
in ruling on the motion to strike presents a question of
law over which we exercise plenary review. . . . The
legal standard applicable to a motion to strike is well
settled. The purpose of a motion to strike is to contest
. . . the legal sufficiency of the allegations of any com-
plaint . . . to state a claim upon which relief can be
granted. . . . A motion to strike challenges the legal
sufficiency of a pleading, and, consequently, requires
no factual findings by the trial court. . . . [The court
takes] the facts to be those alleged in the complaint
. . . and [construes] the complaint in the manner most
favorable to sustaining its legal sufficiency. . . . Thus,
[i]f facts provable in the complaint would support a
cause of action, the motion to strike must be denied.
. . . Moreover . . . [w]hat is necessarily implied [in
an allegation] need not be expressly alleged. . . . It is
fundamental that in determining the sufficiency of a
complaint challenged by a defendant’s motion to strike,
all well-pleaded facts and those facts necessarily
implied from the allegations are taken as admitted. . . .
Indeed, pleadings must be construed broadly and realis-
tically, rather than narrowly and technically.’’ (Citations
omitted; internal quotation marks omitted.) Plainville
v. Almost Home Animal Rescue & Shelter, Inc., 182
Conn. App. 55, 63, 187 A.3d 1174 (2018).
   In Connecticut, ‘‘[t]he elements of a breach of con-
tract action are [1] the formation of an agreement, [2]
performance by one party, [3] breach of the agreement
by the other party and [4] damages.’’ (Internal quotation
marks omitted.) A.C. Consulting, LLC v. Alexion Phar-
maceuticals, Inc., 194 Conn. App. 316, 329, 220 A.3d
890 (2019). ‘‘Although this court has intimated that cau-
sation is an additional element thereof . . . proof of
causation more properly is classified as part and parcel
of a party’s claim for breach of contract damages.’’
(Citation omitted.) Meadowbrook Center, Inc. v. Buch-
man, supra, 149 Conn. App. 186. Causation focuses on
whether the plaintiff’s loss ‘‘may fairly and reasonably
be considered [as] arising naturally, i.e., according to
the usual course of things, from such breach of contract
itself.’’ (Internal quotation marks omitted.) West Haven
Sound Development Corp. v. West Haven, 201 Conn.
305, 319, 514 A.2d 734 (1986). ‘‘[I]n order to recover for
breach of contract, a plaintiff must prove that he or
she sustained damages as a direct and proximate result
of the defendant’s breach.’’ Warning Lights & Scaffold
Service, Inc. v. O & G Industries, Inc., 102 Conn. App.
267, 271, 925 A.2d 359 (2007). ‘‘Causation [is] a question
of fact for the [fact finder] to determine . . . .’’ (Inter-
nal quotation marks omitted.) Meadowbrook Center,
Inc. v. Buchman, supra, 193.
   In its motion for entry of judgment, the defendant
argued that the amended complaint ‘‘[did] not suffi-
ciently plead a breach of contract’’ because it ‘‘fail[ed]
to plead facts that sufficiently allege the causation ele-
ment.’’ (Internal quotation marks omitted.) In the defen-
dant’s view, the ‘‘plaintiff impermissibly bases his dam-
ages on speculation concerning what the [NYDFS] may
have done had certain regulatory filings made by [the
defendant] not been deficient . . . .’’ (Internal quota-
tion marks omitted.) At oral argument on the motion,
the defendant argued that the plaintiff’s amended com-
plaint failed to adequately plead that the defendant’s
breach caused the plaintiff damages because the com-
plaint included ‘‘no allegations of what would have hap-
pened had the [NYDFS] gotten the information,’’ that
the defendant was required to provide it, and whether
the NYDFS ‘‘would . . . have done something differ-
ently.’’ The defendant further argued that ‘‘the plaintiff
pleads no facts that would allow the inference that had
the [NYDFS] known the full extent of the changes, it
would have prevented the defendant from implement-
ing it or that the [NYDFS] would have required the
defendant to allow existing policyholders to opt out or
that it would have prevented implementation.’’
  The plaintiff agreed that what the NYDFS would have
done had the defendant filed the requisite application
under New York Insurance Law § 4240 (e) was specula-
tive because the defendant did not follow the proper
procedures, but asserted that what the NYDFS would
have done had the defendant followed New York Insur-
ance Law § 4240 (e) was not relevant to the court’s
consideration of the legal viability of the complaint.
The plaintiff argued that the defendant breached the
contract by not obtaining the requisite permission from
the NYDFS to change the plaintiff’s annuity policy, as
required by the contract, and that the breach caused
the plaintiff damages because the defendant ‘‘sold or
substantially sold, the equity position, and repurchased
it.’’ According to the plaintiff, the ‘‘defendant unlawfully
made a material change to the strategy that was
designed to protect the defendant and it was done at
the plaintiff’s expense’’ and, therefore, ‘‘what would
have happened had [the NYDFS] required notice [prior
to the implementation of the ATM Strategy] is some-
thing we’ll never know because it happened in 2011.’’
In short, the plaintiff argued that because the defendant
improperly changed the annuity policy without prior
approval, the changes to the policy were automatically
approved by the NYDFS, and this caused the plaintiff
damages because the changes liquidated the plaintiff’s
equity exposure, resulting in damages to the plaintiff
in the amount of approximately $90,000 or about 20
percent of his original investment. The plaintiff alleges
that his damages were incurred immediately upon the
implementation of the ATM strategy and, therefore, the
speculation concerning what the NYDFS would have
done had the defendant followed the proper procedures
was entirely irrelevant.
    In granting the defendant’s motion to strike the origi-
nal complaint, the court relied on Meadowbrook Center,
Inc. v. Buchman, supra, 149 Conn. App. 193, to find
that ‘‘the causation of damages the plaintiff has alleged
for his breach of contract claim are speculative, and
that, as a result, his complaint fails to plead facts that
sufficiently allege the causation element of his breach
of contract claim.’’ The court stated: ‘‘Like the plaintiff
in Meadowbrook, the plaintiff here bases his damages
on speculation concerning what the NYDFS may have
done had the defendant adequately informed and
explained the significance of the changes that the ATM
Strategy made.’’ In granting the defendant’s motion for
entry of judgment on the amended complaint, the court
referred to its reliance on Meadowbrook and held that
‘‘[i]n this case, the plaintiff did not supply the essential
allegation of fact as to what the [NYDFS] would have
done if the defendant had filed a proper disclosure in
2011, probably because this key element is inescapably
a matter of speculation. Although the amended com-
plaint contains several new allegations, they fail to
address the essential failing of the plaintiff’s single con-
tract count, where causation is premised on speculation
as to what the regulatory body might have done with
respect to the changes in the variable annuity policy
at issue.’’
   In response, the plaintiff claims that the court applied
the wrong legal standard in relying on Meadowbrook
Center, Inc. v. Buchman, supra, 149 Conn. App. 177.
We agree with the plaintiff that Meadowbrook is inappo-
site to the present case. First, we note that Mead-
owbrook did not involve a motion to strike. Rather,
Meadowbrook involved factual findings by the court
and a judgment on the merits. In Meadowbrook, after
a bench trial took place, the court rendered judgment
for the plaintiff and awarded it damages. Id., 182–84.
The defendant appealed and claimed, inter alia, that
the award of damages stemming from his breach of the
contract was impermissibly speculative. Id., 184. On
appeal, this court reversed the judgment of the trial
court, holding that because the ‘‘plaintiff failed to estab-
lish that its loss . . . naturally and directly resulted
from the defendant’s conduct, the award of [damages
was] improper.’’ Id., 194. In sum, Meadowbrook is mate-
rially distinct from the present case because the judg-
ment in that case was rendered following a bench trial.
   The plaintiff also claims that the court improperly
relied on prospective findings of fact at the pleading
stage to determine that he had failed to adequately plead
causation. The plaintiff argues that, to the extent it is
relevant, what the NYDFS might have done had the
defendant followed the proper procedures is ultimately
a question of fact reserved for the trier of fact after an
evidentiary hearing. According to the plaintiff, at the
pleading stage, his ‘‘amended complaint adequately
alleges each element required to sustain a breach of
contract action, including adequately alleging ‘damages
resulting from the breach.’ ’’
    At the pleading stage, a plaintiff is not required to
prove that he sustained damages as a result of the
defendant’s breach. See Godbout v. Attanasio, supra,
199 Conn. App. 111–12 (‘‘[A] pleading must contain a
plain and concise statement of the material facts on
which the pleader relies, but not of the evidence by
which they are to be proved . . . . The purpose of fact
pleading is to put the defendant and the court on notice
of the important and relevant facts claimed and the
issues to be tried.’’ (Citation omitted; internal quotation
marks omitted.)). Rather, ‘‘[t]o survive a motion to
strike, the plaintiff’s complaint must allege all of the
requisite elements of a cause of action.’’ (Internal quota-
tion marks omitted.) A.C. Consulting, LLC v. Alexion
Pharmaceuticals, Inc., supra, 194 Conn. App. 329.
   Here, we conclude that the plaintiff has alleged facts
sufficient to state a cause of action for breach of con-
tract. The plaintiff has included in his amended com-
plaint, among other things, facts describing how the
defendant’s breach has allegedly caused him damages.
Specifically, the plaintiff has alleged that his contract
required the defendant to (1) comply with all applicable
laws, (2) establish and maintain the plaintiff’s annuity
account pursuant to New York law, and (3) seek
approval from the NYDFS prior to making a material
change or a change to the investment strategy. The
amended complaint alleges that the defendant did not
seek approval from the NYDFS prior to implementing
the ATM Strategy, as required by the contract, resulting
in a breach. The plaintiff alleges that, as a result of
the breach, the ATM Strategy automatically went into
effect. Under the newly implemented ATM Strategy, the
plaintiff alleges, the defendant sold the equivalent of
all of the equity securities in the plaintiff’s account,
leaving his account with no equity exposure. Then,
according to the plaintiff, the defendant repurchased
the securities at a higher price, immediately resulting
in the losses to him and the putative class.
    ‘‘[Construing] the complaint in the manner most
favorable to sustaining its legal sufficiency’’; (internal
quotation marks omitted) Plainville v. Almost Home
Animal Rescue & Shelter, Inc., supra, 182 Conn. App.
63; we conclude that these facts allege all of the requisite
elements of a cause of action for breach of contract.
Whether the plaintiff can prove causation properly
should be left to the finder of fact. See Meadowbrook
Center, Inc. v. Buchman, supra, 149 Conn. App. 193
(‘‘[c]ausation [is] a question of fact for the [fact finder]
to determine’’ (internal quotation marks omitted)).
  The judgment is reversed and the case is remanded
for further proceedings consistent with this opinion.
      In this opinion the other judges concurred.
  1
     The defendant changed its name in 2020 and is now known as the
Equitable Financial Life Insurance Company. Because the defendant has
been referred to as AXA Equitable Life Insurance Company in all prior
proceedings, we use that name in this appeal.
   2
     In his principal brief, the plaintiff sets forth four claims of error. For
convenience, we have distilled the plaintiff’s arguments and address them
in the two aforementioned claims.
   3
     The plaintiff seeks class action certification for this matter, a determina-
tion not made by the court because of the timing and manner in which the
litigation was terminated.
   4
     Section 4240 (e) of New York Insurance Law provides: ‘‘No authorized
insurer shall make any such agreement in this state providing for the alloca-
tion of amounts to a separate account until such insurer has filed with the
superintendent a statement as to its methods of operation of such separate
account and the superintendent has approved such statement. Subject to
the approval of the superintendent, any such statement may apply to one
or more groups of separate accounts classified by investment policy, number
or kinds of separate account participants, methods of distribution of such
agreements or otherwise. In determining whether or not to approve any
such statement, the superintendent shall consider, among other things, the
history, reputation and financial stability of the insurer and the character,
experience, responsibility, competence and general fitness of the officers
and directors of the insurer. If the insurer files an amendment of any such
statement with the superintendent that does not change the investment
policy of a separate account and the superintendent does not approve or
disapprove such amendment within a period of thirty days after such filing,
such amendment shall be deemed to be approved as of the end of such thirty
day period, except that if the superintendent requests further information
on the statement during such period from the insurer, such period shall be
extended until thirty days after the day on which the superintendent receives
such information. An amendment of any such statement that changes the
investment policy of a separate account shall be treated as an original filing.’’
N.Y. Ins. Law § 4240 (e) (McKinney 2007).
   5
     The consent order was attached to the plaintiff’s original complaint.
   6
     Practice Book § 10-44 provides in relevant part: ‘‘Within fifteen days after
the granting of any motion to strike, the party whose pleading has been
stricken may file a new pleading; provided that in those instances where
an entire complaint, counterclaim or cross complaint, or any count in a
complaint, counterclaim or cross complaint has been stricken, and the party
whose pleading or a count thereof has been so stricken fails to file a new
pleading within that fifteen day period, the judicial authority may, upon
motion, enter judgment against said party on said stricken complaint, coun-
terclaim or cross complaint, or count thereof. . . . Nothing in this section
shall dispense with the requirements of Sections 61-3 or 61-4 of the appel-
late rules.’’
   7
     Practice Book § 10-20 provides: ‘‘The first pleading on the part of the
plaintiff shall be known as the complaint. It shall contain a concise statement
of the facts constituting the cause of action and, on a separate page of the
complaint, a demand for relief which shall be a statement of the remedy
or remedies sought. When money damages are sought in the demand for
relief, the demand for relief shall include the information required by General
Statutes § 52-91.’’
   8
     Practice Book § 10-1 provides in relevant part: ‘‘Each pleading shall
contain a plain and concise statement of the material facts on which the
pleader relies, but not of the evidence by which they are to be proved . . . .’’