Coomes v. Maryland Insurance Administration
157 A.3d 364
Md. Ct. Spec. App.2017Background
- Elizabeth Coomes, licensed in VA (2004) and as a nonresident in MD, was investigated by the Virginia Department of Insurance (VDI) after Anthem mistakenly sent two checks (~$20,000) to her agency which were deposited; Coomes eventually repaid all but $2,000 and disputed that remainder.
- Instead of a VDI hearing on allegations including fraud/conversion/forgery, Coomes executed a "voluntary surrender" agreement (signed Dec. 10, 2012; effective March 11, 2013) surrendering her VA license in lieu of a hearing, agreeing not to transact insurance in VA for at least one year and acknowledging potential reporting to other regulators.
- Coomes notified the Maryland Insurance Administration (MIA) in March 2013 of an address change and that she had "requested a voluntary surrender" of her VA license but did not disclose the investigation or submit the surrender agreement; she testified she did not believe the surrender was an "adverse violation."
- The Maryland Insurance Commissioner found the VA voluntary surrender was an "adverse administrative action," concluded Coomes violated I.A. § 10-126(a)(1), (6), (12), (13) and (f), revoked her Maryland producer license, and imposed a $1,250 penalty; the Commissioner granted summary disposition for the MIA.
- The Circuit Court for Baltimore City affirmed the MIA decision on judicial review; the Court of Special Appeals affirmed, holding the surrender was reportable, substantial evidence supported the violations, double jeopardy did not apply, and the trial court did not abuse discretion in denying extra-evidence.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Coomes’s voluntary surrender of her VA license was an "adverse administrative action" requiring reporting under I.A. § 10-126(f) | The surrender was voluntary and not the product of a fact-finding hearing or final order, so it is not an "adverse administrative action." | The surrender was taken in lieu of a hearing, imposed adverse conditions (one-year bar, repayment), and thus is "adverse" and reportable. | Held: the surrender was an adverse administrative action; Coomes was required to report it and provide documents. |
| Whether substantial evidence supports violations of I.A. § 10-126(a)(1), (6), (12), (13) and (f) based on Coomes’s conduct and failure to report | Coomes argued lack of intent and that her subjective belief about the surrender matters; she also argued the MIA should have recognized her March 2013 letter as notice. | MIA relied on undisputed facts: deposit of insurer checks, delay/refusal to repay $2,000, voluntary surrender language, and failure to timely report or produce the surrender agreement. | Held: substantial evidence supports violations of §§ 10-126(a)(1), (6), (12), (13) and (f); failure to report and withholding documents supported lack of trustworthiness. |
| Whether double jeopardy bars Maryland disciplinary action after the VA surrender | Coomes argued the VA surrender was punishment and she cannot be punished twice for the same offense. | MIA argued professional disciplinary actions are remedial, not criminal, and state actions enforce separate regulatory obligations. | Held: double jeopardy does not apply; license discipline is remedial (not criminal) and Maryland may proceed. |
| Whether the circuit court abused discretion by denying leave to offer additional evidence (affidavit about another producer’s surrender) | Coomes contended the affidavit was material and justified late submission. | MIA and court said the proffered evidence was not material to the legal issues decided. | Held: no abuse of discretion; the court reasonably concluded the evidence was not material under S.G. § 10-222(f). |
Key Cases Cited
- McClanahan v. Washington Cty. Dep’t of Soc. Servs., 445 Md. 691 (agency-review standard and scope of review)
- Maryland Aviation Admin. v. Noland, 386 Md. 556 (deference to agency interpretations; administrative expertise)
- Culver v. Md. Ins. Comm’r, 175 Md. App. 645 (failure to report investigative/proceeding disposition supports discipline)
- Spencer v. Maryland State Bd. of Pharmacy, 380 Md. 515 (professional disciplinary sanctions are remedial, not criminal, for double jeopardy purposes)
- Hudson v. United States, 522 U.S. 93 (double jeopardy protects against multiple criminal punishments; civil/regulatory sanctions can be nonpunitive)