427 F.Supp.3d 1133
D. Alaska2019Background
- John H. Snead purchased Transamerica Annuity Policy No. 400000571ML2 in 2003; Karen Snead was the named beneficiary.
- Karen and John divorced in October 2005; their court‑approved divorce settlement (Paragraph 6) awarded Karen the value of certain "retirement accounts" identified by account numbers.
- After the divorce John had a long‑term relationship with Guadalupe Wright (a Merrill Lynch employee). On August 1, 2017 John signed a beneficiary change naming Wright; Wright faxed the form on August 4, 2017 but Transamerica did not process it until August 7, 2017 (after John’s death early that day).
- Karen sued Merrill Lynch and Transamerica alleging claims premised on her status as beneficiary (breach of contract, fiduciary duty, negligence/vicarious liability, consumer protection violations). Defendants moved to dismiss under Rule 12(b)(6), arguing Karen’s beneficiary status was revoked by Alaska’s revocation‑by‑divorce statute, AS 13.12.804.
- The court converted the motion to one for summary judgment because parties submitted and disputed divorce‑agreement documents. Evidence showed the annuity was held in Merrill Lynch account X7695, which Paragraph 1(d) of the divorce award granted to John, and the annuity was a non‑qualified annuity (not a retirement account). Karen submitted only a conclusory affidavit asserting the annuity was a retirement account.
- Court held Karen failed to raise a genuine dispute that the divorce agreement expressly awarded her the annuity or that John intended post‑divorce to keep her as beneficiary; defendants’ motion was granted and Karen’s claims were dismissed as to the original plaintiff. Claims brought by recently added estate/trust representatives were not resolved by this opinion and survive.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Alaska’s revocation‑by‑divorce statute (AS 13.12.804) removes Karen as beneficiary of Annuity 571 | The divorce agreement (Paragraph 6) expressly awarded Karen "all retirement accounts" as of Dec. 31, 2004, which Karen says includes Annuity 571 | AS 13.12.804 automatically revokes beneficiary designations to a former spouse unless an express term of a governing instrument or divorce agreement provides otherwise; the annuity was held in an account expressly awarded to John | Held: Statute applies; no express term in the divorce agreement awarding Annuity 571 to Karen, so beneficiary designation was revoked by divorce |
| Whether the divorce agreement, read in full (including account numbers), creates a genuine dispute of material fact about ownership of Annuity 571 | Karen contends the agreement's award of retirement accounts was intended to include the annuity | Defendants produced account statements and other documents showing Annuity 571 was held in Merrill Lynch account X7695 (awarded to John) and that the annuity was non‑qualified (not a retirement account) | Held: No genuine dispute—documentary evidence ties Annuity 571 to the account awarded to John; Karen’s conclusory affidavit insufficient |
| Whether the court should decide under Rule 12(b)(6) or convert to summary judgment given extrinsic divorce documents | Karen resisted consideration of documents outside the complaint | Defendants relied on divorce documents and account records; court may consider undisputed public records and documents whose authenticity is not contested; parties were allowed to present evidence | Held: Motion converted to summary judgment under Rule 56; parties had opportunity to present materials |
| Whether plaintiff raised sufficient evidence of decedent’s intent to retain Karen as beneficiary despite divorce | Karen points to her continued listing as beneficiary for 13 years and late change when John was terminal | Defendants argue post‑divorce inaction typically reflects inattention; no evidence John intended to keep former spouse as beneficiary | Held: Karen failed to show decedent’s intent to override statutory revocation; presumption not rebutted |
Key Cases Cited
- Sveen v. Melin, 138 S. Ct. 1815 (2018) (discussing purpose and effect of revocation‑on‑divorce statutes and presumption against former‑spouse beneficiary designations)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (movant need not produce evidence but may show absence of genuine factual dispute on an essential element)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (standard for determining whether a genuine issue of material fact exists)
- Vignolo v. Miller, 120 F.3d 1075 (9th Cir. 1997) (treating allegations of material fact as true on a Rule 12(b)(6) motion)
- Branch v. Tunnell, 14 F.3d 449 (9th Cir. 1994) (documents referenced in a complaint and whose authenticity is undisputed may be considered on a Rule 12(b)(6) motion)