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Papotto v. Hartford Life & Accident Insurance Co.

United States Court of Appeals, Third Circuit

September 26, 2013

LISA M. PAPOTTO
v.
HARTFORD LIFE & ACCIDENT INSURANCE COMPANY, Appellant. LISA M. PAPOTTO, an individual, Appellant.
v.
HARTFORD LIFE & ACCIDENT INSURANCE COMPANY

Argued: March 21, 2013

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY (D.C. Civ. Action No. 1-10-cv-04722) District Judge: Honorable Renée Marie Bumb

Brian P. Downey, Esq. (argued) Pepper Hamilton LLP Maria Feeley, Esq. Pepper Hamilton LLP Counsel for Appellant/Cross-Appellee Hartford Life & Accident Insurance Company

Benjamin Goldstein, Esq. (argued) Drinkwater & Goldstein, LLP Counsel for Appellee/Cross-Appellant Papotto

Before: McKEE, Chief Judge, SMITH, and GREENAWAY, JR., Circuit Judges.

OPINION

GREENAWAY, JR., Circuit Judge.

Appellee/Cross-Appellant Lisa Papotto ("Appellee") is a widow seeking payment of benefits from Appellant/Cross-Appellee Hartford Life & Accident Insurance Co. ("Appellant" or "Hartford") under an accidental death and dismemberment policy in relation to her husband's death. The policy at issue explicitly excludes losses "sustained while Intoxicated." Hartford's Plan Administrator denied payment of benefits to Appellee because the deceased had consumed alcohol prior to his death. On appeal, the District Court concluded that the policy implicitly required causal connection between intoxication and the loss, and remanded the case to the Plan Administrator. Both parties posit that we have appellate jurisdiction to hear an appeal from this remand order. Because we conclude that the remand order is not immediately appealable as a final judgment and that the collateral order doctrine does not apply, we dismiss the appeal for lack of jurisdiction.

I. BACKGROUND

A. Facts

The underlying facts in this case are tragic and largely undisputed. On August 7, 2009, Frank Papotto, Jr. ("Mr. Papotto"), late husband of Appellee, was playing golf with several co-workers in New Jersey. That afternoon, he drank approximately four to five beers. At some point during the round, Mr. Papotto dropped his cell phone and fell out of a golf cart while reaching for it. As a result of the fall, Mr. Papotto suffered a head injury and died approximately five hours later.

A toxicology screen conducted posthumously revealed that Mr. Papotto had a blood-alcohol level ("BAL") of 0.115 %. The New Jersey state standard for intoxication is 0.08, putting Mr. Papotto's BAL over the legal limit for operating a motor vehicle. N.J. Stat. Ann. § 39:4-50 (2012).

At the time of his death, Mr. Papotto was an employee of TD Bank. As an employee, Mr. Papotto was entitled to benefits under TD Bank's welfare benefit plan which provided, among other things, accidental death and dismemberment insurance coverage ("AD&D"). This AD&D policy ("the Policy") was purchased through Hartford. Mr. Papotto designated Appellee the beneficiary under the Policy.

The Policy provides Hartford with "full discretion and authority to determine eligibility for benefits and to construe and interpret all terms and provisions of [t]he Policy." (JA 129.) Under the terms of the Policy, benefits are payable when Mr. Papotto "sustain[s] an Injury that results in [a loss — dismemberment or death —] within 365 days of the date of accident." (JA 124.) The Policy states that losses caused or contributed to by an "Injury sustained while Intoxicated" are excluded. (JA 127.) The Policy defines "Intoxicated" as when the insured's "blood alcohol content" or "the results of other means of testing blood alcohol level . . . meet or exceed the legal presumption of intoxication, or under the influence, under the law of the state where the accident occurred." (JA 127.) Appellant contends that this provision is a "status-based exclusion, " whereby coverage is denied simply by the status of the insured, and does not include any element of causation. (Appellant Br. 6.)

B. Procedural History

On August 18, 2009, Appellee filed a claim with Hartford for the AD&D benefits. On October 26, 2009, Hartford denied the claim because the evidence showed that Mr. Papotto was intoxicated at the time of his death. On December 21, 2009, Appellee appealed Hartford's denial to the Plan Administrator. Appellee argued that: (1) Hartford could not rely on the results of the toxicology screen to prove that Mr. Papotto was intoxicated at the time of death (but offered no evidence to show the results of the screen were inaccurate or unreliable); (2) Hartford could not apply the New Jersey standard for intoxication because Mr. Papotto was not operating a motor vehicle at the time of his death; and (3) the Policy's intoxication exclusion must be read to require a causal connection between the intoxication and the loss in order to bar coverage. On January 19, 2010, the Plan Administrator upheld Hartford's decision to deny the AD&D benefits.

On September 15, 2010, Appellee filed a complaint against Hartford in the District Court for the District of New Jersey pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), challenging the Plan Administrator's findings and renewing the three arguments that she raised in her appeal to the Administrator. Both parties brought motions for summary judgment.

The District Court rejected Appellee's first argument and found that it was generally reasonable for an administrator to rely on a toxicology report to establish evidence of intoxication. The District Court also rejected Appellee's second argument and found that it was reasonable for Hartford to rely on the New Jersey statute defining intoxication. Thus, the District Court noted that the only remaining issue in dispute was "the propriety of [Hartford's] construction of the Policy." Papotto v. Hartford Life & Accident Ins. Co., No. 10-4722, 2011 WL 6939331, at *1 (D.N.J. Dec. 30, 2011). The District Court agreed with Appellee as to this issue, and found that Hartford's interpretation of the policy was unreasonable.[1] The District Court concluded that the intoxication exclusion provision must be read to bar coverage only when intoxication caused or contributed to the loss or death.

The District Court thus denied both summary judgment motions as premature, and remanded the case back to the Plan Administrator for consideration of whether Mr. Papotto's intoxication caused or contributed to his death. Id. In its order, the District Court also permitted the Plan Administrator to re-open the record and consider additional evidence to determine causation. The District Court did not enter judgment in favor of any ...


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