Opinion
Civil Lead Action No. SA-98-CA-0943 NN. Consolidated with Member No. SA-00-CA-1063 NN.
May 1, 2001
ORDER ON SUMMARY JUDGMENT
I. Introduction
Before me are two dispositive motions filed by the parties in the instant case: plaintiffs amended cross-motion for summary judgment, filed November 20, 2000 (Docket Entry 55), which incorporates his original motion for summary judgment, filed June 2, 2000 (Docket Entry 36) as well as his amended complaint, filed October 31, 2000 (Docket Entry 47); and a post consolidation motion for final summary judgment (Docket Entry 54), filed on November 14, 2000 by the sole remaining defendant in the case, Conseco Direct Life Insurance Company ("Conseco"). Plaintiff has filed an opposition to Conseco's final summary judgment motion (Docket Entry 51), as well as numerous pleadings as supplementation to his cross-motion for summary judgment (Docket Entries 41, 42, 53, 59, 62-64). I have jurisdiction under 28 U.S.C. § 633 (c) as the parties have consented to proceed before a Magistrate Judge for all matters in this case including trial and entry of final judgment.
See Docket Entries 38 45.
Docket Entries 29 45.
As a preliminary matter, it appears, based on the legal arguments and the parties' position on summary judgment, that there is no factual dispute as to the relevant facts of the case. This lawsuit, rather, concerns various issues of law related to: the interpretation of the contractual definition of "hospital;" the enforceability of the 190-day lifetime limitation for mental illness confinements, and the legality of the seven-day elimination period as provided in the "Day Eight In-Hospital" plan. As both parties have in essence briefed these legal issues in their summary judgment briefing, the parties' positions with respect to those issues will be discussed in tandem .
II. Factual and Procedural Background
Plaintiff purchased three hospitalization insurance policies from Colonial Penn Franklin Insurance Company ("Colonial Penn") in July of 1981. The policies consisted of two identical "Day One In-Hospital" plans (certificate numbers P16429036-8 P07010359-0), which provided benefits immediately upon hospitalization, and one "Day Eight In-Hospital" plan (certificate number P07010359-0), which provided benefits after a seven-day elimination period, or at the eighth day of continuing hospitalization. These plans provided supplemental hospitalization insurance to plaintiff by directly paying him, based on his age and days of confinement, a set dollar amount for each day of hospitalization. They did not pay plaintiffs actual admission costs to the particular hospital provider. All three insurance plans issued to plaintiff were subject to the terms and conditions set forth in Group Policy GT-001 ("group policy").
Docket Entry 25 Attached Exhibits. Also, it should be noted that although the insurance plans at issue were issued by Colonial Penn, defendant Conseco, as successor of Colonial Penn's business affairs, is the party in interest and the only proper defendant in this suit. Docket Entry 55, at 1.
Docket Entiy 55, Exhibit 2 Docket Entry 25.
Plaintiff's Amended Complaint (Docket Entry 47) Exhibit 2.
For example, according to plaintiff's deposition testimony, in 1981, the year he purchased the three insurance plans, he would have been entitled to $25.00 (under age 65) per day under both of the Day One In-Hospital Plans and to $50.00 at the eighth day of hospitalization under the Day Eight In-Hospital Plan, yielding a total benefit of $100.00 per day. Docket Entry 54, Exhibit 3-Fermin's Deposition, at 64-66.
Plaintiff has submitted information which shows how other insurance plans ( i.e ., State Farm, Blue Cross Blue Shield and Kirke Van Orsdel) paid for his health care expenses while confined at the VA Domiciliary in 1996. The information is provided by plaintiff to demonstrate that the services or treatments received at the facility were not "free." Coverage by other health insurance plans and whether the services received at the VA Domiciliary were "free" or not, are irrelevant to the instant case.
Docket Entry 54, at 5, Attachment C.
From February 12, 1996 through September 2, 1996, plaintiff was admitted to the Veteran's Administration Domiciliary ("VA Domiciliary") located in White City, Oregon. Plaintiff sought admission to the VA Domiciliary to receive treatment for post-traumatic stress disorder as he was suffering from related symptoms of depression and alcohol dependency at the time. According to plaintiffs deposition testimony, he specifically sought admission in the VA Domiciliary because it specialized in the treatment of post-traumatic stress disorder, a condition from which he was diagnosed as suffering shortly after his discharge from military service in World War II. At the time, plaintiff was also trying to cope with the grief of his wife's death.
Id., Exhibit 3-Fermin's Deposition, at 68.
Id . at 1-2 Exhibit 3-Fermin's Deposition, at 68, as well as Attachment E to Exhibit 2.
Id . at 2 Exhibit 3-Fermin's Deposition, at 95-97. According to plaintiffs deposition testimony, "combat fatigue" was the name given to his mental/emotional condition because post-traumatic stress disorder was not recognized at the time. Id . at 17-19. The summary judgment records also indicate that plaintiff has a 100% VA connected service disability.
Id .
Prior to his 1996 stay at the VA Domiciliary, plaintiffs medical records reveal that he had an extensive history of confinements for mental and/or psychological conditions related to his post-traumatic stress disorder. These conditions included depression, alcohol dependency, schizophrenia and gambling addiction. Colonial Penn consistently paid the benefits applicable under the plans for covered hospitalizations, but did not pay for those dates during the elimination periods as provided by the "Day Eight In-Hospital" plan.
Id . at 2 Attachment D to Exhibit 2 Defendant's Summary Chart of plaintiff's hospital confinements and diagnoses. See Appendix A: Underlying Facts, at 2.
Id .
Id . at 2 Exhibit 17, "Summary Chart of payments made and application of the seven-day elimination period. The summary Chart was created in response to plaintiff's subpoena for such information." See Appendix B: Exhibits to the Motion for Summary Judgment, at 2. Significandy, this Chart shows plaintiff first received coverage for his confinement on December 2, 1981.
Plaintiff submitted a claim to Colonial Penn for his 1996 stay at the VA Domiciliary. Colonial Penn denied the claim on the grounds that the VA Domiciliary is not a "hospital" as the term is defined under the three insurance plans and group policy. Colonial Penn also denied the claim on the ground that even if the VA Domiciliary were to meet the definition of "hospital" as given in the insurance instruments, plaintiff had already exceeded the 190-day lifetime limitation on benefits for hospitalizations for mental, psychoneurotic or personality disorders. Plaintiff counters that the VA Domicialiary is a "hospital," and therefore, he should be entitled to insurance coverage for his stay in the facility. Although plaintiff does not dispute Colonial Penn's position that he has exhausted the maximum days allowed to receive benefit payments for mental illness hospitalizations under said plans and controlling group policy, he does assert that such limitation is unlawful pursuant to Texas law and the Americans with Disabilities Act ("ADA"), 42 U.S.C. § 12101 et seq .
Id . at 2, Attachment G to Exhibit 2, Letter dated November 11, 1996 from Denise Myers, Colonial Penn's Health Claims Technical Analyst. See also Attachment F to Exhibit 2, Letter dated March 8, 1997 from Colonial Penn to Plaintiffs attorney.
Id .
Docket Entry 55, at 2.
Plaintiff originally filed a state court action against Colonial Penn for the denial of his claim for hospitalization insurance benefits. In that lawsuit, plaintiff asserted three main causes of action: (1) breach of contract; (2) breach of common law and statutory duty of good faith and fair dealing; and (3) disability discrimination, in violation of the ADA, as well as state law. Defendant, on October 9, 1998, removed plaintiffs action to the United States District Court of the Western Division, San Antonio Division, on the grounds of diversity and federal question jurisdiction. Subsequently, the parties consented to proceed before a Magistrate Judge for all purposes, including trial of the case. Upon the parties' consent, the case was referred to me on May 5, 2000.
Docket Entry 1; and plaintiff's original petition filed September 2, 1998.
Docket Entry 1, Cause No. SA-98-CA-0943-DWS.
Docket Entry 29.
Meanwhile, plaintiff, filed a second lawsuit, pro se , in Travis County District Court, alleging that the "Day Eight In-Hospital" plan contained an improper elimination period and was discriminatory against those subscribers who suffered from mental illnesses. Colonial Penn promptly removed the lawsuit to the United States District Court of the Western District, Austin Division, and asked that it be transferred to the San Antonio Division, and consolidated with the first lawsuit because it related to the same hospitalization plans and group policy. Again, upon the consent of both parties, these two lawsuits were consolidated for trial before me on October 3, 2000. Plaintiff then amended his complaint with respect to the claims alleged in the second lawsuit filed in Austin. Specifically, plaintiff alleges that the "Day Eight In-Hospital" plan, with its seven-day elimination period, violates 28 TEX. ADMIN. CODE §§ 3.3073(a) 3.5106, and the TEX. INS. CODE ANN. arts. 21.21A, 3.70-3(B)(7) and 21.47(a). In that regard, plaintiff seeks retroactive payments, with interest, for sixteen hospitalizations, originally not covered due to Colonial Penn's application of the seven-day elimination period. Plaintiff also alleges that the sale of the "Day Eight In-Hospital" policy in Texas constituted mail fraud, in violation of 18 U.S.C. § 1341, a breach of the common law and statutory duty of good faith and fair dealing, recklessness and gross negligence (as predicates for an award of punitive damages), civil perjury and breach of contract. In addition, plaintiff alleges that to the extent that his claims premised on state law are barred by limitations, the discovery rule should toll the limitations because he first learned of the defendant's purported statutory violations on July 6, 2000, which was also the date he stopped paying his premiums for coverage under the plans. According to his amended complaint, plaintiff seeks actual damages in the amount of $6,000.00 for insurance benefits purportedly owed to him; statutory annual interest for nineteen years as set forth in TEX. INS. CODE ANN. art. 21.55 for defendant's delay in making insurance payments owed to him under the plans; mental anguish damages for nineteen years to be set by the court, and exemplary damages of no less than $200,000.00, in addition to any other relief to which plaintiff has shown is justly entitled.
The case was originally docketed as Cause No. A-00-CA-535-SS. After the transfer, it became Cause No. SA-00-CA-1063-NN.
Docket Entry 45. Now both cases are consolidated under Civil Lead Action No. SA-98-CA-943-NN.
Docket Entry 47.
Id . at 2.
Id . at 2-3.
Id . at 3-4.
Id . 5. Presumably, the nineteen years for which plaintiff seeks relief began sometime in 1982, when his hospitalization confinement was first covered, to the present time.
Defendant maintains plaintiff is not entitled to the relief sought and requests that summary judgment be entered on all of plaintiffs causes of action as a matter of law because: (1) plaintiffs confinement in the VA Domiciliary was not a covered "hospital" under the applicable certificates of insurance and group policy; (2) the "Day Eight In-Hospital" plan is approved for sale by the Texas Department of Insurance and it is a legal plan; (3) Colonial Penn did not breach its common law and statutory duty of good faith and fair dealing when it denied coverage to plaintiff; (4) the 190-day lifetime limitation to collect benefits for hospitalizations related to mental illnesses does not violate the ADA or any Texas law; (5) plaintiff cannot assert a private cause of action for federal mail fraud as a matter of law and (6) Texas law does not recognize a separate private cause of action for civil perjury. Plaintiff, in addition to responding to defendant's summary judgment motion, has also moved for cross summary judgment on these issues. I will proceed to analyze each of these legal arguments under the summary judgment framework discussed below.
III. Jurisdiction
The court has jurisdiction pursuant to 28 U.S.C. § 1331, 1332 1367.
IV. Substantive Issues Presented
1. Has plaintiff established that defendant breached its contract under Texas law when it denied hospitalization insurance benefits for his confinement in the VA Domiciliary?
2. Has plaintiff established that the contractual 190-day lifetime limit for mental illness confinements violates the ADA or any Texas law?
3. Has plaintiff established that defendant breached its common law and statutory duty of good faith and fair dealing under Texas law when it denied his claim for insurance benefits for his stay at the VA Domiciliary?
4. Has plaintiff established that defendant's "Day Eight In-Hospital" plan (with its seven-day elimination period) violates any of the Texas statutory and/or regulatory provisions as alleged in his Amended Complaint?
5. Has plaintiff established a viable cause of action for federal mail fraud?
6. Has plaintiff established a viable cause of action for civil perjury under Texas law?
V. Summary Judgment Standard
A party is entitled to summary judgment upon motion if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Mere allegations of a factual dispute between the parties will not defeat an otherwise proper motion for summary judgment; the requirement is that there be no genuine issue of material fact. A fact is material if it might affect the outcome of the lawsuit under the governing law. A dispute about a material fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Therefore, summary judgment is proper if, under governing laws, there is only one reasonable conclusion as to the verdict; if reasonable finders of fact could resolve a factual issue in favor of either party, summary judgment should not be granted.A party seeking summary judgment bears the initial responsibility of informing the court of the basis for its motion and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact. To satisfy this burden, the movant must either submit evidentiary documents that negate the existence of some material element of the nonmoving party's claim or defense, or if the crucial issue is one for which the nonmoving party will bear the burden of proof at trial, merely point out that the evidentiary documents in the record contain insufficient proof concerning an essential element of the nonmoving party's claim or defense. Regardless of whether the moving party accompanies its summary judgment motion with affidavits or other evidentiary materials, the motion must be granted if the evidence before the court demonstrates that the standard for entry of summary judgment, as set forth in Rule 56(c), is satisfied.
Celotex Corp. v. Catrett, 477 U.S. at 323; Wise, 58 F.3d at 195;Burfield v. Brown, Moore, Flint, Inc., 51 F.3d 583, 588 (5th Cir. 1995).
Edwards v. Aguillard, 482 U.S. 578, 595 n. 16 (1987); and Celotex Corp. v. Catrett, 477 U.S. at 325.
Id .
Once the moving party has carried that burden, the burden shifts to the nonmoving party to show that summary judgment is not appropriate. The nonmoving party cannot discharge this burden by referring to the mere allegations or denials of the nonmoving party's pleadings. Rather, the nonmoving party's response must, either by submitting opposing evidentiary documents or by referring to evidentiary documents already in the record, set out specific facts showing the existence of a genuine issue for trial. When both parties move for summary judgment, as in this case, each party must carry its own burden as the movant for its motion and as the non-movant in response to the other party's motion. All justifiable inferences must still be drawn in favor of the losing party.
Fields v. City of South Houston, 922 F.2d 1183, 1187 (5th Cir. 1991).
FED.R.CIV.P. 56(e); Anderson v. Liberty Lobby, Inc ., 477 U.S. at 250; State of Texas v. Thompson, 70 F.3d 390, 393 (5th Cir. 1995).
Celotex Corp. v. Catrett, 477 U.S. at 324; Fields , 922 F.2d at 1187; Neff v. American Dairy Queen Corp., 58 F.3d at 1065; Engstrom v. First Nat'l Bank, 47 F.3d 1459, 1462 (5th Cir. 1995), cert. denied, 516 U.S. 818 (1995).
See Blackie v. Maine, 75 F.3d 716, 721 (1st. Cir. 1996).
See Murphy Expl. Prod. Co. v. Oryx Energy Co.,
101 F.3d 670, 673 (Fed. Cir. 1996).
VI. Analysis
1. Is the VA Domiciliary a "hospital"?Plaintiff's breach of contract claim is premised on the assumption that the VA Domiciliary constitutes a "hospital," as the term is defined under the three health insurance plans and group policy at issue in this case. Plaintiff does not appear to argue that the contractual definition of the term "hospital" is in itself ambiguous. What plaintiff disputes is defendant's decision to exclude the VA Domiciliary from the contractual definition of "hospital" as the basis for denying him coverage. In that regard, he argues that because both parties differ as to the proper interpretation of the term "hospital," an ambiguity has been created, and his interpretation, as that of the insured, should be favored by the court. Based on my review of the contractual definition in question, as well as the nature of the services provided by the VA Domiciliary and plaintiffs course of treatment during the stay at the facility, I conclude that, contrary to plaintiffs position, defendant did not breach its contract when it denied him coverage.
Insurance policies are controlled by rules of interpretation and construction which are applicable to contracts generally. The primary concern of a court in construing a written contract is to ascertain the true intent of the parties as expressed in the instrument. If a contract term is so worded that it can be given a definite or certain legal meaning, then it is not ambiguous. Parol evidence is not admissible for the purpose of creating an ambiguity. If, however, the language of a policy or contract is subject to two or more reasonable interpretations, it is ambiguous. If ambiguous, an insurance contract will be construed against the insurer, the author of the contract. Whether a contract is ambiguous is a question of law that appellate courts review de novo . In deciding whether a contract term is ambiguous, a court is not confined to the four corners of the instrument: "Evidence of surrounding circumstances may be consulted . . . to determine whether or not the contract is ambiguous." These "surrounding circumstances" include trade usage and the course of the parties' performance of the contract. In addition, the terms of the contract are to be given their ordinary meaning unless there are other provisions indicating a contrary intention of the parties.
See Forbau v. Aetna Life Insurance Company, 876 S.W.2d 132 (Tex. 1994).
Id . at 133. See also National Union Fire Insurance Company of Pittsburgh v. CBI Industries, Inc ., 907 5.W.2d 517, 520 (Tex. 1995).
CBI Industries, 907 S.W.2d at 520.
Id .
Id . (citing Glover v. National Insurance Underwriters, 545 S.W.2d 755, 761 (Tex. 1977)).
See National Union Fire Insurance Co., 907 S.W.2d at 520.
Sun Oil v. Madeley, 626 S.W.2d 726, 731 (Tex. 1981). See also Columbia Gas Transmission Corp. v. New Ulm Gas, Ltd ., 940 S.W.2d 587, 591 (Tex. 1996); City of Pinehurst v. Spooner Addition Water Co ., 432 S.W.2d 515, 518 (Tex. 1968) ("Where a question relating to the construction of a contract is presented, . . . we are to take the wording of the instrument, considering the same in the light of the surrounding circumstances, and apply the pertinent rules of construction thereto and thus settle the meaning of the contract.") (Emphasis added). Thus, the general rule is that a court "may (1) hear and consider evidence of the circumstances surrounding the formation and execution of the contract and (2) apply the rules of construction whenever the parties disagree as to the proper construction of a writing. Neither a pleading nor a finding of ambiguity is required." MARK K. GLASSER KEITH A. ROWLEY, On Parol: The Construction and Interpretation of Written Agreements and the Role of Extrinsic Evidence in Contract Litigation, 49 BAYLOR L. REV. 657, 701 (1997).
See GLASSER ROWLEY, 49 BAYLOR L. REV, at 667.
See Zimmerman v. National Home Life Assurance Co., 517 S.W.2d 842, 845 (Tex.Civ.App.-Waco 1974).
As previously stated, plaintiff was insured under three Colonial Penn hospitalization insurance plans, each of which provided for a fixed daily benefit for "hospital confinement." The plans further provided that "[t]he Benefits described in this Certificate are subject to the conditions, exceptions and other provisions of Group Policy GT-001." Plaintiffs certificates of insurance and group policy GT-001 define the term "hospital" as follows:
Docket Entry 25 Attached Certificates of Insurance for "Day One-In Hospital Plan" and "Day Eight In-Hospital Plan."
Id . at 1, section titled "Your Certificate of Insurance." See also Docket Entry 54, Exhibit 2, Attachment C-Copy of Group Policy GT-001.
"Hospital" means only:
Medicare Approved Hospitals . An institution which, while you use it, has an agreement as a provider of inpatient hospital services under the Medicare program (i.e., Section 1866 of Title XVIII of the Social Security Act of 1965 and its amendments) shall be considered a "hospital". Note: Confinement in a hospital unit or area which functions primarily as a nursing home or rest or convalescent home will not be considered confinement in a "hospital".
Christian Science Sanitoria . A Sanitorium operated by or certified by the First Church of Christ, Scientist, Boston, Massachusetts, shall be considered a "hospital".
Other Institutions . An institution, other than those above, which meets fully all of the following requirements will be considered a "hospital" : (a) holds a State license as a hospital (if a license is required); (b) operates primarily for the care and treatment of sick or injured persons as inpatients; (c) provides 24-hour-a-day nursing services by registered or graduate nurses; (d) has a staff of one or more licensed physicians available at all times; (e) provides on the premises, or through contractual arrangement with another institution, organized facilities regularly used for diagnosis and major surgery. Note: Certain institutions which might otherwise meet these requirements will not be considered "hospitals". An institution which is primarily a clinic, nursing home or rest or convalescent home is not a "hospital". An institution which is, other than incidentally, a place for the treatment of alcoholics or drug addicts is not a "hospital". Confinement in a hospital unit or area which functions primarily as a nursing home or rest or convalescent home will not be considered confinement in a "hospital".
Docket Entry 25 Attached Certificates of Insurance, at 2, section titled "what Certain Terms Mean When You Used This Certificate." (Emphasis added). See also Docket Entry 54, Exhibit 2, Attachment C-Copy of Group Policy GT-001, Part I, "Definitions." (Emphasis in original).
According to the above quoted definition, defendant maintains that the VA Domiciliary is not a "hospital," and as such, plaintiffs confinement from February 12 through September 2, 1996 in that facility is excluded from coverage. I agree.
It is undisputed that the VA Domiciliary is not a "Medicare Approved Hospital" or a "Christian Science Sanitoria." The issue in this case is whether the VA Domiciliary meets all the requirements of "Other Institutions," or whether it falls within any of the exceptions outlined in that section. That section, as quoted above, specifically states: "[a]n institution which is, other than incidentally, a place for the treatment of alcoholics or drug addicts is not a `hospital.'" Confinement in a hospital unit or area which functions primarily as a nursing home or rest or convalescent home will not be considered confinement in a "hospital." Defendant relied on this exception to deny coverage in this case.
Docket Entry 54, at 6 Exhibit 1.
Id . at Exhibit 2, Attachment G.
Docket Entry 54, at 6 and Docket Entry 25 Attached Certificates of Insurance, at 2, section titled "What Certain Terms Mean When You Used This Certificate." (Emphasis added). See also Docket Entry 54, Exhibit 2, Attachment C-Copy of Group Policy GT-001, Part I. "Definitions." (Emphasis in original).
Defendant has brought forth summary judgment evidence in support of its position that the VA Domiciliary is not a "hospital" as such term is specifically defined in the hospitalization insurance plans and group policy. Besides the precise quoted language found in the plans and group policy at issue in this case, the defendant has provided the sworn testimony of the VA Domiciliary's clinic administrator. Significantly, the administrator describes the facility's main purpose of operation as that of providing short-term vocational rehabilitation, substance abuse treatment and long-term residential care for veterans. The administrator's sworn testimony in fact corroborates plaintiffs deposition testimony in which he stated that the reason he sought treatment at the facility was to overcome his post-traumatic stress disorder related symptoms of depression and alcohol abuse. Plaintiff further testified that during his stay in the facility he was primarily under the care of a psychologist, not a medical doctor.
Docket Entry 54, Exhibit 1, ¶ 3. In that regard, according to the administrator's sworn testimony, the VA Domiciliary is only accredited in the areas of behavioral health, ambulatory care, substance abuse and employment services. Id . at ¶ 6.
Docket Entry 54, at 7 Exhibit 3-Fermin's Deposition, at 101-03, 107 113.
In addition, the VA Domiciliary administrator stated in his sworn affidavit that one hundred and five (105) of its eight hundred and thirty-three (833) beds are dedicated specifically for the treatment of substance abuse patients. Based on this information, defendant concluded that the VA Domiciliary is an institution that, more than incidentally, is a place for treatment of substance abuse patients; and thus, it is not considered a "hospital" for purposes of coverage. Plaintiff has not provided any competent summary judgment evidence to rebut the VA Domiciliary's more than "incidental" role in the treatment of substance abuse patients. The alcohol abuse treatment plaintiff admittedly received while at the facility further supports defendant's position.
Id . at Exhibit 1, ¶ 4.
Docket Entry 54, at 6.
Id . at Exhibit 3-Fermin's Deposition, at 101-103, 107 113.
Further, it is also noted that plaintiff has not provided any evidence that the defendant's position of excluding the VA Domiciliary from its definition of "hospital" is inconsistent with previous coverage decisions. In other words, plaintiff has failed to demonstrate that prior to his 1996 stay at the VA Domiciliary, defendant provided coverage for confinement at other similar facilities. Accordingly, I conclude there are no genuine issues of material fact that plaintiffs confinement in the VA Domiciliary in 1996 was properly excluded from coverage because such facility did not meet the contractual definition of a "hospital." Contrary to plaintiffs suggestion, mere disagreement over the interpretation of a contractual term does not create an ambiguity. Here, the meaning of the contract term "hospital," with its specific exclusionary language, is plain, clear and unambiguous.
See Sun Oil Co., 626 S.W.2d at 731-32.
See Zimmerman, 517 5.W.2d at 844-45, where the court, in construing a similar contractual definition of "hospital" found that a "skilled nursing facility" was in essence a nursing home, and as such, plaintiff's confinement in such facility was unambiguously excluded from coverage.
Plaintiffs reliance on other Texas and federal administrative and/or statutory authority to challenge the contractual definition of "hospital" is not persuasive. For example, a careful reading of one of plaintiffs legal authorities, the Texas Administrative Code, indicates that a policy definition of the term hospital may exclude "convalescent homes, convalescent facilities, rest facilities, or nursing facilities;" or "home or facilities primarily for the aged, drug addicts, alcoholics, those primarily affording custodial care, educational care, or those primarily affording care for mental and nervous disorders." This section in fact supports defendant's position that the VA Domiciliary, a facility which provides short-term vocational rehabilitation, substance abuse treatment and long-term residential care for veterans, is not a "hospital" for purposes of coverage. While it is true, as plaintiff contends, that section 3.3040(d) of the Texas Administrative Code prohibits the exclusion of coverage for "confinement in a hospital operated by the federal government," Colonial Penn did not deny plaintiff coverage on that ground. In fact, there is ample undisputed summary judgment evidence that Colonial Penn previously provided plaintiff coverage for numerous confinements at VA Medical Center Hospitals.
28 TEX. ADMIN. CODE § 3.006 (2000).
Docket Entry 54, at 7-8 Exhibit 1, at ¶¶ 2 5.
Docket Entry 54, at 7, Appendix A, at ¶ 4 (including Summary Chart), Exhibit 2, at Attachment D Exhibit 2, at ¶ 7.
Plaintiff has also cited to 38 U.S.C. § 1701 (7) to argue that since domiciliary care is afforded to veterans as part of medical services under the statute, that such care should also be covered under his private hospitalization insurance plans. Plaintiffs argument is not well-taken. The hospitalization insurance plans to which plaintiff subscribed to obtain supplemental coverage at issue in this case were independent from his status as a veteran. In that regard, § 1701 which deals with the benefits granted to veterans by the federal government, does not regulate the authority of private insurance companies, such as Colonial Penn, to define contractual terms as they deem appropriate and in compliance with applicable law. Likewise, plaintiffs citation to federal regulation, 38 C.F.R. § 3.551, which classifies domiciliary care as hospitalization for purposes of determining pension benefits, bonuses and other relief to which veterans are entitled, is unpersuasive. Even assuming, arguendo, that plaintiffs interpretation of that federal regulation is correct, this case has nothing to do with pension benefits. Plaintiffs reliance on that federal regulation, again, is misguided.
In addition, plaintiff has cited to National Bankers Life Insurance Co., v. Hornbeak , 266 S.W.2d 228 (Tex.Civ.App. Waco 1954, n.w.), in support of his position that the VA Domiciliary is a "hospital" under the insurance plans and group policy at issue in this case. In Hornbeak , the court dealt with a completely different hospitalization insurance policy than the ones at issue in this case. Further, in that case, the hospitalization insurance plan did not define the controlling term "recognized hospital" nor did it except convalescent hospitals from the various types of institutions that could properly be classified as hospitals within the broadest meaning of that term. For that reason, the court concluded that the policy was ambiguous or uncertain of meaning, and as such, it found in favor of coverage.
Unlike in Hornbeak , the term "hospital" in this case is specifically defined in plaintiffs insurance plans and group policy. Further, these instruments also discuss in detail the institutions or facilities that are specifically excluded from coverage. Accordingly, because plaintiff has failed to bring forth any competent summary judgment evidence and/or persuasive legal authority in support of his contention that the VA Domiciliary meets the definition of "hospital" as such term is defined in his insurance plans and group policy, defendant's request for summary judgment on that issue is granted. 2. Is the 190-day lifetime limit for mental illness confinements unlawful?
Further, to the extent that plaintiff has objected to the affidavit of the VA Domiciliary's administrator, that objection has no meritbecause it is based on a purported definition of "hospital" under a statute from Oregon which has no relevance to this case.
Irrespective of whether the VA Domiciliary is a "hospital," as that term is defined under the controlling certificates of insurance and group policy, it is undisputed that plaintiff exceeded the contractual 190-day lifetime limitation for insurance benefits for hospital confinement due to "mental, psychoneurotic or personality disorders." The summary judgment record reveals that prior to his 1996 confinement in the VA Domiciliary, plaintiff was hospitalized on numerous occasions, for a total of 234 days, for mental, psychoneurotic or personality disorders. He received benefits under the certificates of insurance and group policy for all such hospitalizations. Significantly, plaintiff does not dispute that prior to his 1996 confinement at the VA Domiciliary, he had already exhausted the 190-day lifetime limitation for coverage for mental illness hospitalizations. The following colloquy which ensued during plaintiff's deposition is further proof of this point:
Docket Entry 54, Exhibit 1 Exhibit 2, Attachments F G.
Docket Entry 25 Attached Certificates of insurance; and Docket Entry 54, Exhibit 2, Attachment C Group Policy GT-001.
See Docket Entry 54, Table detailing plaintiffs dates of hospitalizations, medical providers, length of stays and mental/psychoneurotic diagnoses. Appendix A, at 2, and medical records, Exhibit 2, Attachment "D" and Exhibit 3-Fermin's Deposition, at 71 92.
Q. My client [Colonial Penn] never refused to insure you, did it?
A. No, no, no.
Q. Nor did it refuse to continue to insure you, did it?
A. Yes, 190 days.
Q. It's never refused to continue the policies in effect, that is, the insurance —
A. Then that particular clause would come in — would be extent where it says —
Q. So your contention is that my client has refused to —
A. Extent, E-X-T-E-N-T.
Q. Well, refused to extent doesn't make any sense, so you're saying it refused to do what?
A. To insure me. In other words, when the 190 days lifetime for mental illness is exhausted, that's the end of coverage for mental illness.
Q. And you agree with that, correct, under the policy that that's the terms of the policy?
A. Under the policy that's what it says.
Q. You agree that you have exceeded the 190 days for mental illness based on the hospitalizations that are in Exhibit 3 that are summarized, do you not?
A. Correct. And according to this statute, I gather that it's prohibited. of course, I could be wrong. It's up to the judge to decide if I'm right or wrong.
Id . at Exhibit 3-Fermin's Deposition, at 125-26 (Emphasis added).
Plaintiffs testimony reveals that he knew there was a contractual provision limiting coverage for mental illness confinements to 190 days and that upon exhausting such coverage, Colonial Penn was entitled to follow the terms of the plans and policy and deny coverage. Moreover, it is undisputed that plaintiffs confinement in the VA Domiciliary, from February 12 to September 2, 1996, was to receive treatment for his post-traumatic stress disorder, depression and alcohol dependency. The 190-day coverage limitation unquestionably applied to these conditions. In fact, Colonial Penn by a letter dated March 8, 1997, informed plaintiffs counsel at the time who was seeking reconsideration of the denial of benefits, that Colonial Penn was denying plaintiffs claim for benefits because the VA Domiciliary was not a "hospital" and because "he has exhausted his allotted lifetime limit of 190 days for confinement due to mental, psychoneurotic or personality disorders as provided for in each of his three plans." Because the contractual 190-day lifetime limitation specifically excludes plaintiff's entitlement for the additional coverage made the basis of this lawsuit, defendant's request for summary judgment on plaintiffs breach of contract claim is also granted on that basis.
Id . at Exhibit 2, Attachment E.
Id . at Exhibit 2, Attachment F (Emphasis added).
Plaintiff cites two cases in support of his position that the 190-day lifetime limitation for coverage of mental illness hospitalizations is unlawful under Texas law. The two cases are: Nautilus Insurance Co., v. Zamora , 114 F.3d 536 (5th Cir. 1997) and Parsaie v. United Olympic Life Insurance Co ., 29 F.3d 219 (5th Cir. 1994). Although those two cases discuss general principles of insurance law, they do not involve the enforceability of a similar 190-day lifetime limitation of coverage as the one presented in this case.
Plaintiff further asserts that the 190-day lifetime limitation on hospitalization benefits for "mental, psychoneurotic or personality disorders," as provided in his three insurance plans and group policy, violates Title III of the ADA. Plaintiffs ADA claim is premised on the argument that such coverage limitation for mental illness hospitalizations is discriminatory because no similar limitation exists in said plans for physical conditions or disabilities. According to a recently decided case by the Fifth Circuit Court of Appeals, which addressed the very same issue, plaintiff's ADA claim fails as a matter of law.
Title III of the ADA provides, in relevant part:
No individual shall be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation by any person who owns, leases (or leases to), or operates a place of public accommodation.
In McNeil v. Time Insurance Co ., 205 F.3d 179, 188 (5th Cir. 2000), the Fifth Circuit, in analyzing Title III of the ADA, concluded that such provision did not apply to the coverage terms of a health insurance policy. Specifically, the Fifth Circuit in McNeil held that a health insurance policy that limited coverage for AIDS to $10,000 during the first two years of coverage did not violate the ADA. According to the Fifth Circuit's rationale, the insurance company in McNeil did not have to change the terms of its product to accommodate those with AIDS as long as it offered the same product to all potential subscribers. In finding no violation of the ADA in McNeil , the Fifth Circuit followed the overwhelming weight of authority from other circuit courts that have held that Title III of the ADA only requires physical access to the goods and services of places of public accommodation, and does not require equality in the content of insurance policies, for the disabled or for varying disabilities.
Id . at 187-88.
Id . fn.12 13. See Weyer v. Twentieth Century Fox Film Corp ., 198 F.3d 1104 (9th Cir. 2000) (summary judgment for defendant/employer upheld where the district court concluded that disability plan, which provided greater benefits for physical disabilities than for mental ones, did not violate the ADA); Doe v. Mutual of Omaha Insurance Co ., 179 F.3d 557, 559-63 (7th Cir. 1999) (insurance policy with cap on AIDS coverage did not violate Title III of the ADA), cert. denied , 120 S.Ct. 845 (2000); Lenox v. Healthwise of Kentucky, Ltd ., 149 F.3d 453 (6th Cir. 1998) (summary judgment to employer affirmed finding that ADA does not prohibit health insurance providers from differentiating between persons with different disabilities); Ford v. Schering-Plough Corp ., 145 F.3d 601, 613 (3d Cir. 1998) (insurance policy limiting coverage for mental disabilities did not violate Title III); and Parker v. Metropolitan Life Ins. Co ., 121 F.3d 1006, 1012 (6th Cir. 1997) (concluding that Title III does not regulate the content of goods and services).
Plaintiff in this case cannot show that he was denied access to the hospitalization insurance benefits provided by Colonial Penn because of a disability. In fact, there is no evidence on record that at the time plaintiff obtained the hospitalization insurance plans and group policy made the bases of this suit, that he received a different (or limited) hospitalization insurance coverage than other subscribers similarly-situated. His complaint, i.e ., that there is not an equal or similar lifetime limitation for physical disabilities, is about the content of the coverage provided in the plans and group policy. Challenging the content of an insurance policy is not actionable under the ADA. Under McNeil , the ADA does not require the same coverage for different disabilities, or between physical and mental disabilities. Accordingly, plaintiffs disability discrimination claim fails as a matter of law because the 190-day lifetime limitation for "mental, psychoneurotic, or personality disorders" does not violate the ADA.
McNeil , 205 F.3d at 188 ("We [The Fifth Circuit] read Title III to prohibit an owner, etc., of a place of public accommodation from denying the disabled access to the goods or service and from interfering with the disableds' full and equal enjoyment of the goods and services offered. But the owner, etc., need not modify or alter the goods and services that it offers in order to avoid violating Title III.") (Emphasis added).
Further, it should also be noted that plaintiff obtained his hospitalization insurance plans and group policy in 1981. Accordingly, the ADA, which was enacted in 1990, may have no application to plaintiff's assertions prior to that time. Nevertheless, because plaintiffs ADA claim fails on substantive grounds, I will assume, without ruling, that the ADA in fact applies to the insurance plans and policy during all relevant times in this case.
Moreover, to the extent that plaintiff alleges that the 190-day lifetime limitation violates 28 TEX. ADMIN. CODE § 21.702, that claim fails for the same reasons as his ADA claim. Section 21.702 prohibits unfair discrimination between individuals of the same class, by, for instance:
(1) refusing to insure, or refusing to continue to insure, or limiting the amount, extent, or kind of coverage available to an individual, or charging a different rate for the same coverage solely because of a physical or mental impairment, except where the refusal, limitation, or rate differential is based on sound actuarial principles, including actual or reasonably anticipated experience; or
(2) without exception, refusing to insure, or refusing to continue to insure, or limiting the amount, extent, or kind of coverage available to an individual, or charging an individual a different rate for the same coverage solely because of blindness or partial blindness.
28 TEX. ADMIN. CODE § 21.702(a)(1-2) (these listed discriminatory acts are non-exhaustive).
There is no evidence supporting plaintiffs contention that Colonial Penn somehow violated section 21.702. Based on the record before me, there is no evidence that Colonial Penn refused to insure plaintiff, refused to continue his insurance, or limited his insurance based upon a mental or physical impairment. Instead, Colonial Penn treated plaintiff the same as other similarly-situated individuals it insured. Colonial Penn paid plaintiff all the benefits due under the plans and only denied payment when plaintiff exhausted his coverage for mental illness confinements as set forth in the insurance instruments.
3. Did Colonial Penn breach its common law and statutory duty of good faith and fair dealing?
Plaintiff alleges that in denying coverage for his 1996 stay at the VA Domiciliary, Colonial Penn breached its common law and statutory duty of good faith and fair dealing under Texas law. Defendant denies the allegation and argues that its decision to deny coverage in this instance was appropriate under the express terms of the insurance plans and group policy. Because plaintiff has failed to establish that coverage existed for his 1996 stay at the VA Domiciliary under the insurance plans and group policy as I have already discussed in this Order, plaintiffs claims for extra contractual relief fail as a matter of law.
In Universe Life Insurance Co. v. Giles , the Texas Supreme Court revised the common law standard for establishing a breach of the duty of good faith and fair dealing to parallel the statutory bad faith standard. Under the new standard, plaintiff must prove that Colonial Penn denied his claim and that it "knew or should have known that it was reasonably clear that the claim was covered." As I have already previously discussed, Colonial Penn's denial of coverage was based on a correct interpretation of the terms of the hospitalization insurance plans and group policy. Plaintiffs stay at the VA Domiciliary was not covered because, first, the VA Domiciliary, is not a "hospital" as that term is defined under said plans and policy, and second, even if it were considered a "hospital," plaintiff had by then already exhausted his 190-day lifetime limitation for coverage of mental illness confinements. "As a general rule, there can be no claim for bad faith when an insurer has promptly denied a claim that is in fact not covered."
950 S.W.2d 48 (Tex. 1998).
Id . at 54-55.
Republic Insurance Co. v. Stoker , 903 S.W.2d 338, 341 (Tex. 1995) (and case authorities cited therein).
Therefore, as a matter of law, Colonial Penn did not violate the common law duty of good faith and fair dealing and it did not engage in statutory bad faith under the Texas Insurance Code. Because the statutory and common law standards are now the same under Texas law, a finding that there is no common law violation as a matter of law also eliminates the statutory claim alleged by plaintiff in this case. Accordingly, defendant's request for summary judgment on plaintiffs extra contractual tort claims is granted.
See Muniz v. State Farm Lloyds , 974 5.W.2d 229, 233 (Tex.App. — San Antonio 1998, no pet. h.) (finding that insurer had reasonable basis for denying claim served as res judicata to all claims, common law and statutory, predicated on good faith and on liability becoming reasonably clear, and also to any claim that the insurer had engaged in unfair trade practices in forcing plaintiffs to sue to recover).
See Higginbotham v. State Farm Mutual Auto Ins. Co ., 103 F.3d 456 (5th Cir. 1997) (under Texas law, insurer which was found not to have acted in bad fath in denying insured's claims could not be held liable under either the Insurance Code or the DTPA since those extra-contractual tort claims required the same predicate for recovery as bad faith causes of action). Id . at 460 (citations omitted); and Douglas v. State Farm Lloyds , 37 F. Supp.2d 532, 544 (S.D. Tex. 1999).
4. Is the seven-day elimination period of the "Day Eight In-Hospital" plan unlawful?
Plaintiff has raised numerous statutory and regulatory challenges to the seven-day elimination period contained in the "Day Eight In-Hospital" plan. In order to be entitled to hospitalization benefits under said plan, plaintiff was required to be hospitalized for a continuous period of at least seven days. Plaintiff claims that this seven-day elimination period in the policy violates title 28 of the Texas Administrative Code, §§ 3.3073(a) 3.5106 and articles 21.21A 3.70-3(b)(7) of the Texas Insurance Code. My review of these authorities, however, reveal that none of them provide plaintiff with a viable cause of action.
Section 3.3073(a) of Title 28 of the Texas Administrative Code, entitled "Minimum Standards for Hospital Confinement Indemnity Coverage," provides in relevant part:
`Hospital Confinement Indemnity Coverage' is a policy of accident and sickness insurance which provides daily benefits for hospital confinement on an indemnity basis in an amount not less than $15 per day or $100 per week and not less than 31 days during any `one period of confinement' for each person insured under the policy. A one day or two day elimination period maybe used when `one period of confinement' is not less than 31 days and not more than 364 days. A three day elimination period may be used when one period of confinement' is 365 days or more.
28 TEX. ADMIN. CODE § 3.3073(a) (2000).
In turn, defendant points to section 3.3081 of title 28 of the Texas Administrative Code, entitled "Nonconventional Coverage," which provides that
The [insurance] commissioner may authorize approval of a policy that does not correspond with one of the categories as described in §§ 3.3071-3.3077 and 3.3078-3.3079 of this title (related to Minimum Standards and Benefits and Readability for Accident and Health Insurance Policies) if such policy is determined to be a type of coverage that is experimental in nature or a type of coverage that will in the opinion of the commissioner fulfill a reasonable public need [ . . . ].
§ 3.3081.
In that regard, defendant has presented summary judgment evidence, not contradicted by plaintiff, indicating that the Commissioner of Insurance on July 21, 1981, approved, by Commissioner's Order 81-2796, the "Day Eight In-Hospital" plan submitted by Colonial Penn (form number 10-82-314/C2DEH), for sale to Texas consumers. On July 30, 1981, Commissioner's Order 81-2796 was amended to properly reflect the official name of Colonial Penn, from "Colonial Penn Franklin Life Insurance Company" to "Colonial Penn Franklin Insurance Company." Since the Commissioner of Insurance approved the "Day Eight In-Hospital" plan for sale in Texas, plaintiffs claim that such plan is somehow illegal is not supported by the record. Plaintiff was properly paid pursuant to the terms of the policy and Colonial Penn has shown, by undisputed summary judgment evidence, that the policy was legal and approved for sale in Texas.
Docket Entry 54, at 12 Exhibit 4.
Id . at Exhibit 4, Commissioner's Order 81-2916.
In addition, it should be noted that plaintiff has failed to establish his right to assert a private cause of action under TEX. ADMIN. CODE § 3.3073(a). Such provision merely states the minimum standards for hospital confinement indemnity coverage. It does not create a cause of action itself nor does it state a separate prohibition of any specific conduct. Plaintiff has simply failed to demonstrate a right of individual recovery based on an alleged violation of 28 TEX. ADMIN. CODE § 3.3073(a).
See Tri-Legends Corp. v. Ticor Title Insurance Co., of California , 889 S.W.2d 432, 441 (Tex.App. Houston (14th Dist.) 1994) (property purchaser's claim that title insurance company misrepresented record title was not actionable under section of administrative code that prohibits insurers from engaging in unfair practices as defined elsewhere; section at issue did not create a cause of action itself but rather, required claimant to rely on insurance code or other State Board of Insurance order for its cause of action).
Because plaintiff's claim pursuant to 28 TEX. ADMIN. CODE § 3.3073(a) fails on substantive grounds, I find no need to address the limitations bar raised by defendant as to this claim and the discovery rule defense raised by plaintiff as a means to toll the applicable limitations period. Docket Entry 54, at 16-17; and Docket Entry 47, at 3-4.
Plaintiff also complains that Colonial Penn misrepresented the terms of the policy under article 21.21A of the Texas Insurance Code and breached the duty of good faith and fair dealing by failing to comply with state law in drafting its policy under article 3.70-3(b)(7). This assertion lacks merit. For instance, article 3.70-3, entitled "Accident and Sickness Policy Provisions," mandates that insurance policies which are delivered or issued for delivery to any person in Texas must contain a series of provisions, and further provides the exact language to be used for the wording of such provisions. Specifically, article 3.70-3(B)(7) requires the following provision: "Conformity With State Statutes: Any provision of this policy which, on its effective date, is in conflict with the statutes of the state in which the insured resides on such date is hereby amended to conform to the minimum requirements of such statutes." Contrary to plaintiffs assertion, the group policy, which is incorporated in the "Day Eight In-Hospital" plan for all purposes, specifically contains a provision meeting the requirements of article 3.70-3(B)(7). Such provision is found in part VIII, "Policy Provisions," page 46 of the group policy. The policy provision is entitled " CONFORMITY WITH STATE STATUES (sic)," and specifically provides: "Any provision of this policy which on its effective date is in conflict with the statutes of the jurisdiction in which this policy was delivered or issued for delivery is hereby amended to conform to the minimum requirements of such statutes." This language copies, almost verbatim , the statutory language of article 3.70.3(B)(7) of the Texas Insurance Code. Plaintiffs argument that Colonial Penn is in violation of this article is not supported by the express terms of the group policy.
TEX. INS. CODE ANN. art. 3.70-3(B)(7) (Vernon 2001).
Docket Entry 54, at Exhibit 2, Attachment C.
Further, it is unclear whether article 21.21A and/or 3.70-3(B)(7) of the Texas Insurance Code even provide for a private cause of action as plaintiff has alleged in this case. For instance, section 3 of article 21.21A provides that the statute is penal in nature: "If any person violates any of the provisions of this Article, the person, shall, in addition to any other penalty specifically provided, be guilty of a Class A misdemeanor." Further, section 4 of article 21.21A confers on the commissioner of insurance enforcement authority "to suspend or cancel the certificate, charter, permit, or license to engage in the business of insurance of any society, association, corporation, or person violating the provisions of this Article." Nowhere in the Article is there a provision authorizing a private cause of action to an insured. Similarly, article 3.70-3 does not in itself provide for a private cause of action such as the one alleged by plaintiff in this case. It only discusses the provisions that must be included in accident and sickness policies delivered or issued for delivery in Texas. As mentioned earlier in this Order, the "Day Eight In-Hospital" plan was approved for sale in Texas by the Commissioner of Insurance and was found in compliance with all applicable statutes 28 and regulations.
TEX. INS. CODE ANN. art. 21.21A § 3 (Vernon 2000).
§ 4.
Plaintiff next contends that Colonial Penn is not in compliance with TEX. INS. CODE ANN. art 21.47(a) because the "Day Eight In-Hospital" plan, according to plaintiff, violates 28 TEX. ADMIN. CODE § 3.5106. This contention is frivolous. Even assuming that plaintiff has the right to assert a private cause of action under art 21.47(a), despite the express language of the statute characterizing an offense under the statute as a third degree felony, plaintiff has failed to articulate how defendant violated such provision or section 3.5106 of the Texas Administrative Code. Section 3.5106 alerts insurance companies of those insurance provisions "which would encourage misrepresentation or are unjust, unfair, inequitable, misleading, deceptive, or contrary to law or to the public policy." It appears, from plaintiffs deposition testimony, that he is relying on the provision dealing with "incontestability," as a means to challenge the "Day Eight In-Hospital" plan under section 3.5106. Plaintiff, however, has made no assertion that Colonial Penn ever contested plaintiffs right to coverage under the plan as provided in that regulation. His deposition testimony is further proof that he has suffered no damages as a result of Colonial Penn's purported violation of section 3.5106.
28 TEX. ADMIN. CODE § 3.5106(a) (2000).
§ 3.5106(a)(2)(D).
Docket Entry 54, Exhibit 3-Fermin's Deposition, at 115-122.
I should mention that according to plaintiffs deposition testimony, it is evident that he has raised several insurance law violations by defendant under various Texas statutes and regulations, even though he has no proof in support of those assertions. According to his own deposition testimony, he has admittedly pleaded statutory and/or regulatory violations by defendant irrespective of whether defendant ever invoked those statutory and/or regulatory provisions against him, or of whether he has suffered any damages as a result of the purported violations. Plaintiff has done so with the expectation that the court will find a violation by defendant somewhere in these provisions, and award him damages. This court, however, expects more from a civil litigant. Having said that, I must briefly address defendant's request that sanctions be imposed against plaintiff for knowingly bringing unfounded claims. Although I acknowledge that plaintiffs statutory and regulatory claims are not supported by the factual circumstances of the case and/or by the applicable law, I have taken into consideration plaintiffs pro se status and hereby decline to assess monetary sanctions against him at this time.
Docket Entry 54, at 15.
5. Has plaintiff established a cause of action for mail fraud under federal law?
Next, plaintiff claims that defendant violated the federal mail fraud statute, 18 U.S.C. § 1341, by using the mail system for the purpose of selling an "unauthorized" Eight Day In-Hospital plan in Texas. As discussed earlier in this Order, defendant has presented competent summary judgment evidence, uncontradicted by plaintiff, establishing that the Commissioner of Insurance approved said plan for sale to Texas residents. Therefore, plaintiff cannot prove that defendant engaged in mail fraud by transmitting through the mail system an otherwise legal insurance plan for sale in Texas. Even assuming that plaintiff can satisfy his burden of proof, the Fifth Circuit Court of Appeals does not recognize an implied private cause of action under the federal mail fraud statute, 18 U.S.C. § 1341, as a matter of law. See Bell, Jr., et al., v. Health-Mor, Inc., et al ., 549 F.2d 342, 346 (5th Cir. 1977) (dismissal for lack of subject-matter jurisdiction affirmed in part on the basis that plaintiffs had no private right of action under the federal mail fraud and lottery statutes) (citing Napper v. Anderson , 500 F.2d 634 (5th Cir.), cert. denied , 423 U.S. 837 (1975)). For these reasons, plaintiffs cause of action for federal mail fraud under 18 U.S.C. § 1341 fails as a matter of law.
6. Has plaintiff established a cause of action for civil perjury?
Finally, plaintiff alleges that Colonial Penn committed perjury through its agents when it filed instruments with the Texas Department of Insurance certifying compliance with all applicable statutes and regulations, when in fact Colonial Penn, according to plaintiff, was in violation of 28 TEX. ADMIN. CODE § 3.4020 and TEX. INS. CODE ANN. arts. 3.70-3(7), 21.21A 3.70-4. Plaintiff also appears to allege, although, not clear from the record, that Colonial Penn's agents violated these authorities by failing to renew their license to sell health insurance in Texas. Based on the summary judgment record before me, however, I find that Colonial Penn (or its agents) has not violated any of the statutory and regulatory authorities relied upon by plaintiff.
In addition, Texas courts have consistently held that there is no separate cause of action for civil perjury. See Kale v. Palmer , 791 S.W.2d 628, 631 (Tex.App.-Beaumont 1990) (citing Horlock v. Horlock , 614 S.W.2d 478 (Tex.App.-Houston [14th Dist.] 1981, writ ref'd n.r.e.), where the court affirmed the trial court's refusal to submit plaintiffs requested special issues for fraud based on misrepresentation by defendant in former divorce trial). See also Chandler v. Gillis , 589 S.W.2d 552, 554 (Tex.App.-El Paso 1979, writ ref'd n.r.e.) (affirming summary judgment against plaintiff who alleged a "civil wrong" based upon former perjured testimony); Morris v. Taylor , 353 S.W.2d 956, 958 (Tex.App.-Austin 1962, writ ref'd n.r.e.) (affirming summary judgment against plaintiff alleging malicious prosecution based upon perjured testimony in former suit), cert. denied , 371 U.S. 842 (1962).
Moreover, the only Texas statute I have found dealing with perjury is TEX. PEN. CODE ANN. § 37.01 (Vernon 1994 Supp. 2001). In that statute, perjury is described as a criminal misdemeanor. That penal statute cannot support plaintiffs purported claim for civil perjury.
VII. Conclusion
It is therefore ORDERED that defendant's motion for final summary judgment (Docket Entry 54) is GRANTED with respect to plaintiffs pleaded causes of action for breach of contract, common law and statutory duty of good faith and fair dealing, misrepresentation and/or fraud, federal mail fraud and civil perjury. Plaintiff has failed to allege facts sufficient to entitle him to the relief requested such that there is no genuine issue of material fact under the applicable legal standards. To the extent that defendant has requested that monetary sanctions be assessed against plaintiff, such request is DENIED (Docket Entry 54, at 15). It is also ORDERED that plaintiffs amended cross motion for summary judgment (Docket Entry 55) is DENIED in all respects and this matter is DISMISSED WITH PREJUDICE . Any other pending motions not addressed in this Order are DENIED AS MOOT . The parties shall bear their own costs.