Cincinnati Life Insurance Comp v. Marjorie Beyrer
722 F.3d 939
| 7th Cir. | 2013Background
- In 2007 Kevin and Marjorie Beyrer agreed to purchase car dealerships owned by Mark Savoree, financing the deal with loans from Casey State Bank (CSB). Kevin obtained a life insurance policy naming Marjorie beneficiary in May 2007 and assigned the policy to CSB in July 2007 (assignment recites "for value received").
- The dealership sale faltered (Ford franchise approval never obtained), loans were restructured and defaulted; CSB obtained judgments and later assigned its interest in those judgments and the life-policy assignment to Stan Grotenhuis.
- Kevin was diagnosed with terminal cancer in May 2008, applied for an accelerated benefit under the policy in May 2010 (Cincinnati Life refused to pay without assignee consent), and died in June 2010; Cincinnati Life interpleaded about $3 million with the court.
- Marjorie removed the interpleader to federal court and repeatedly amended pleadings asserting multiple cross- and third-party claims alleging breaches, fraud, conspiracy, promissory estoppel, and unjust enrichment against Savoree, CSB, and Grotenhuis.
- The district court: (1) dismissed claims 1, 2, 3, and 7 for failing to meet Fed. R. Civ. P. 8/10(b)/9(b) pleading standards; (2) granted summary judgment to CSB/Grotenhuis on claims 4–6; (3) held the July 2007 assignment valid and awarded the insurance proceeds to Grotenhuis; and (4) denied Marjorie’s motions to modify/reconsider. The Seventh Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Pleading sufficiency under Rules 8 & 10(b) (claims 1–2) | Marjorie argued her Third Amended Answer stated multiple causes of action and provided sufficient factual allegations. | Defendants argued the pleading was a disorganized "kitchen sink" lacking separate counts, coherent factual allegations, and fair notice. | Dismissal affirmed: complaint violated Rules 8 and 10(b); too vague and confusing for litigation. |
| Fraud-based claims particularity under Rule 9(b) (claims 3 & 7) | Marjorie claimed conspiracy, promissory estoppel, and unjust enrichment based on fraudulent conduct and alleged facts on information and belief. | Defendants argued fraud allegations lacked "who, what, when, where, how" particularity and improperly relied on information-and-belief without grounds. | Dismissal affirmed: claims failed Rule 9(b) particularity; information-and-belief allegations were insufficient. |
| Summary judgment on claims 4–6 | Marjorie contended triable issues existed on remaining cross-claims. | Defendants moved for summary judgment showing no genuine dispute; Marjorie did not meaningfully oppose. | Affirmed: no genuine factual disputes; summary judgment proper. |
| Validity/effect of the July 2007 life-policy assignment (ownership of proceeds) | Marjorie argued assignment lacked consideration and did not prevent her recovery of the accelerated benefit; she later submitted additional evidence. | Grotenhuis/CSB argued the written assignment expressly transferred rights "to collect net proceeds," recited consideration, and Illinois law permits such assignments. | Affirmed: assignment valid on its face; Marjorie failed to produce admissible evidence creating a genuine dispute of material fact. |
| Motions to modify/reconsider (post-judgment/new evidence) | Marjorie argued newly discovered evidence (third-party deposition) undermined the district court's finding about consideration and the assignment. | Defendants argued the evidence could have been discovered earlier, and motions were untimely or re-litigating issues. | Affirmed: district court did not abuse discretion; evidence was not shown to be newly discovered with due diligence or likely to produce different result. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: courts need not accept legal conclusions as true)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
- Stanard v. Nygren, 658 F.3d 792 (7th Cir. 2011) (purpose of Rules 8 and 10 is fair notice and framing issues)
- Pirelli Armstrong Tire Corp. Retiree Med. Benefits Trust v. Walgreen Co., 631 F.3d 436 (7th Cir. 2011) (limits on pleading fraud on information and belief)
- AnchorBank, FSB v. Hofer, 649 F.3d 610 (7th Cir. 2011) (Rule 9(b) requires who/what/when/where/how for fraud)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986) (nonmoving party must show genuine dispute beyond metaphysical doubt to survive summary judgment)
- Envtl. Barrier Co., LLC v. Slurry Sys., Inc., 540 F.3d 598 (7th Cir. 2008) (standards for newly discovered evidence on Rule 59(e))
- Oto v. Metro. Life Ins. Co., 224 F.3d 601 (7th Cir. 2000) (may not use reconsideration to introduce evidence that could have been presented earlier)