Baumann v. American Family Mutual Insurance
836 F. Supp. 2d 1196
D. Colo.2011Background
- Plaintiff seeks underinsured motorist benefits; 89-year-old pedestrian injured by Henderson; medical bills exceed $200,000; plaintiff now claims breach, bad faith, and CRS violations against American Family.
- Henderson’s liability policy paid $50,000; plaintiff’s Ohio Casualty UM/UIM policy paid $50,000; total UM/UIM coverage available from American Family allegedly $300,000.
- Plaintiff alleges American Family delayed and underpaid UIM benefits, providing only $22,000 despite evidence of damages far exceeding policy limits.
- Hodges, retained by plaintiff, offered opinions on insurance industry standards and claims handling; defendant challenges admissibility.
- Court applies Rule 702 and Daubert/Kumho standards to determine admissibility of Hodges’ opinions; motion to exclude granted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of Hodges’ legal conclusions | Baumann argues Hodges’ opinions are industry standards, not legal conclusions | American Family contends Hodges’ opinions define legal duties and misstate law | Excluded; opinions invade the court’s law-interpretation function |
| Undisputed amounts obligation to pay | Hodges discusses undisputed portion and duty to tender | No clear, permissible basis to opine on undisputed payment duties | Excluded; presents legal conclusions about duty to pay undisputed amounts |
| Characterization of ebill/testing as a hurdle | Hodges asserts systemic hurdles and late UB documentation | Opinion seeks to label insurer practices as systematic hurdles | Excluded; inflammatory and improper legal characterization |
| Reliance on Hodges’ methodology under Rule 702 | Expert provides industry-standard analysis | Methodology attempts to instruct on law | Excluded; testimony not framed to aid jury under proper standard |
Key Cases Cited
- Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (Supreme Court 1993) (gatekeeping for reliability and relevance of expert testimony)
- Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137 (Supreme Court 1999) (extension of Daubert to all experts, not just scientific)
- Specht v. Jensen, 853 F.2d 805 (10th Cir. 1988) (experts cannot define the law; avoid legal conclusions)
- Marx & Co. v. Diners’ Club, Inc., 550 F.2d 505 (2d Cir.1977) (testimony on ordinary practices allowed to compare conduct to standards)
- General Electric Co. v. Joiner, 522 U.S. 136 (Supreme Court 1997) (conclusions must be connected to data; not purely ipse dixit)
- A.E. By and Through Evans v. Independent School Dist. No. 25, 936 F.2d 472 (10th Cir.1991) (limits on expert legal conclusions by lawyers as experts)
- United States v. Jensen, 608 F.2d 1349 (10th Cir.1979) (cannot state legal conclusions or apply law to facts)
- United States v. Nacchio, 555 F.3d 1234 (10th Cir.2009) (burden on proponent to show admissibility of expert testimony)