Malcolm Wiener v. AXA Equitable Life Insurance Company ( 2023 )

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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 21-2165
MALCOLM WIENER,
Plaintiff – Appellant,
v.
AXA EQUITABLE LIFE INSURANCE COMPANY,
Defendant – Appellee.
Appeal from the United States District Court for the Western District of North Carolina, at
Charlotte. Robert J. Conrad, Jr., District Judge. (3:18−cv−00106−RJC−DSC)
Argued: December 6, 2022 Decided: January 20, 2023
Before GREGORY, Chief Judge, WILKINSON, Circuit Judge, and John A. GIBNEY, Jr.,
Senior United States District Judge for the Eastern District of Virginia, sitting by
designation.
Reversed and remanded by published opinion. Judge Wilkinson wrote the opinion, in
which Chief Judge Gregory and Senior Judge Gibney joined.
ARGUED: Ross Fulton, RAYBURN COOPER & DURHAM, P.A., Charlotte, North
Carolina, for Appellant. Matthew Woodruff Sawchak, ROBINSON, BRADSHAW &
HINSON, P.A., Raleigh, North Carolina, for Appellee. ON BRIEF: David G. Webbert,
JOHNSON, WEBBERT & GARVAN, LLP, Augusta, Maine; Richard H. Fallon, Jr.,
Cambridge, Massachusetts; Carolyn T. Seely, Greenwich, Connecticut, for Appellant.
John R. Wester, Stephen D. Feldman, ROBINSON, BRADSHAW & HINSON, P.A.,
Charlotte, North Carolina, for Appellee.
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WILKINSON, Circuit Judge:
Malcolm Wiener appeals the district court’s post-trial dismissal of his case for lack
of subject-matter jurisdiction. A jury found that AXA Equitable Life Insurance Company
negligently reported false medical information about Wiener to an information
clearinghouse used by insurance companies, causing him to become uninsurable. Despite
the fact that the parties satisfied the requirements for federal diversity jurisdiction, and the
fact that both parties litigated the entire case through trial under North Carolina law, the
district court decided that Connecticut law applied and found itself deprived of subject-
matter jurisdiction by virtue of a Connecticut statute. This was error. Choice of law is
waivable and was waived here. And even if Connecticut’s law applied, it would not have
ousted federal jurisdiction. Finding no merit in the alternative ground for affirmance that
AXA advances with respect to liability, we reverse and remand the case for further
proceedings in accordance with this opinion.
I.
Because Wiener won a jury verdict, we recite the facts as the jury found them,
construe all disputed facts in his favor, and give him the benefit of all reasonable inferences.
See Konkel v. Bob Evans Farms Inc., 165 F.3d 275, 279 (4th Cir. 1999).
Wiener, a citizen of Connecticut, purchased $16 million in life insurance from AXA
Equitable, a citizen of New York, in the 1980s. After Wiener’s policy lapsed in 2013, he
applied for reinstatement and authorized AXA to access his medical records. AXA
conducted a medical assessment of Wiener’s reinstatement application without attempting
to speak to Wiener’s primary care doctor and without reviewing the follow-up tests in his
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medical records. AXA then negligently and erroneously concluded that Wiener suffered
from four serious medical conditions.
Based on its flawed review of Wiener’s medical history, AXA’s North Carolina
office reported false diagnosis “codes” to an information exchange—the Medical
Information Bureau (MIB). The MIB is a consortium of about 400 companies, which write
about 90–95% of the individual life insurance policies in the United States. When an MIB
member reviews an applicant’s medical records, it reports any medical conditions that
might be relevant to a later underwriter in the form of standardized six-character codes.
Wiener’s application was assigned to an AXA underwriter in Connecticut, Hallie Hawkins,
who reviewed his medical records and asked her colleague in AXA’s North Carolina office,
Sandra Huffstetler, to report Wiener’s MIB codes.
In 2014, AXA declined Wiener’s application for reinstatement. So Wiener’s
insurance agent submitted new applications for a $16 million policy to at least eight other
insurers. Two carriers made preliminary offers for $10 million policies at double the
standard rate. No other carrier offered Wiener a policy. Several insurance-company
representatives informed Wiener’s agent that Wiener’s MIB codes adversely affected their
determination, and an expert testified that at least one code that AXA incorrectly reported
was a “hot button[]” that would deter carriers from offering insurance. J.A. 1581.
Wiener sued AXA in North Carolina state court in 2018. His complaint alleged that
Huffstetler, who worked in AXA’s North Carolina operations center, reported false
conclusions about his medical conditions to the MIB, causing him to become uninsurable.
The complaint included four counts under North Carolina law: (1) negligent
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misrepresentation; (2) libel; (3) negligence; and (4) violation of North Carolina’s Unfair
and Deceptive Trade Practices Act, N.C. Gen. Stat. § 75-1.1. AXA removed the case to the
Western District of North Carolina based on diversity of citizenship. AXA’s answer cited
North Carolina law and did not raise any choice-of-law issues. See J.A. 146.
The district court denied AXA’s motion for summary judgment with respect to
Wiener’s claim that AXA negligently caused him to become uninsurable. It concluded that
there was a “genuine dispute of fact as to whether the MIB codes effectively rendered
[Wiener] uninsurable or insurable at a significantly increased cost.” Id. at 235. The court
granted AXA summary judgment on Wiener’s remaining claims. AXA’s memorandum
supporting its summary-judgment motion, the court’s summary-judgment decision, and
AXA’s trial brief all cited North Carolina law as the governing law.
A jury trial on Wiener’s negligence claim was held in September 2020. AXA moved
for a directed verdict, arguing that Wiener’s claimed injury was categorical uninsurability,
and that this injury was contradicted by his own evidence because several companies gave
Wiener preliminary offers of insurance. The district court denied the motion. The jury
subsequently found AXA liable for negligence and awarded Wiener $8 million—the value
of the $16 million death benefit from his lapsed policies less $8 million because Wiener
had not mitigated his damages.
AXA moved for post-trial relief. Its motion objected to the court’s subject-matter
jurisdiction for the first time. Relying on North Carolina law, AXA asserted that an
exclusive-remedies provision of North Carolina’s Consumer and Customer Information
Privacy Act (CCIPA) preempted Wiener’s negligence claim and deprived the court of
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subject-matter jurisdiction. AXA also challenged the sufficiency of the evidence. In
response, Wiener argued, inter alia, that the North Carolina statute did not apply because
it only applies to North Carolina residents, and Wiener lives in Connecticut.
The district court concluded that it lacked subject-matter jurisdiction and dismissed
the case. While the court noted that the parties had not disputed that North Carolina law
governed as the case proceeded through trial, the court undertook a choice-of-law analysis
sua sponte based on the possibility that Connecticut law applied. It held that Connecticut
law applied because the North Carolina choice-of-law inquiry looks to the place of injury,
and Wiener’s injury—his inability to procure life insurance—occurred in his home state of
Connecticut. The court then determined that Connecticut’s Insurance Information and
Privacy Protection Act (CIIPPA) provided exclusive statutory remedies for AXA’s
reporting of inaccurate MIB codes and thereby deprived the court of subject-matter
jurisdiction over Wiener’s common-law negligence claim. So the court dismissed the case
for lack of jurisdiction without reaching AXA’s remaining arguments.
Wiener timely appealed.
II.
We review de novo a district court’s dismissal for lack of subject-matter jurisdiction.
See Holbrook v. United States, 673 F.3d 341, 345 (4th Cir. 2012).
At the outset, we note that there is no dispute that Wiener and AXA satisfy the
statutory requirements for federal diversity jurisdiction under 28 U.S.C. § 1332. Wiener is
a citizen of Connecticut, AXA is a citizen of New York, and the amount in controversy
exceeds $75,000. See 28 U.S.C. § 1332(a).
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Moreover, while AXA argues that the choice of Connecticut law made no difference
in this case, it is clear that the district court’s decision to apply Connecticut’s law instead
of North Carolina’s was determinative. AXA claims that North Carolina has a Consumer
and Customer Information Privacy Act that, like the Connecticut statute, would preempt
Wiener’s negligence claim. But the North Carolina statute applies only to “persons who
are residents” of North Carolina. N.C. Gen. Stat. § 58-39-10(b)(1). Because Wiener has
never been a resident of North Carolina, the North Carolina CCIPA would not preempt his
negligence claim. So the district court’s dismissal of Wiener’s case depended on the court’s
decision to apply Connecticut law.
We must therefore determine whether the district court erred in dismissing for lack
of subject-matter jurisdiction based on its choice of Connecticut law. We conclude that
choice of law is waivable, not jurisdictional, and AXA waived the possible application of
Connecticut law by affirmatively litigating under the substantive law of North Carolina. It
was therefore error for the district court to apply Connecticut law. And even assuming
arguendo that it was proper for the court to apply Connecticut law, that law would not have
ousted its subject-matter jurisdiction.
A.
“All U.S. Courts of Appeals to have addressed the issue have held that choice of
law issues may be waived.” Williams v. BASF Catalysts LLC, 765 F.3d 306, 316 (3d Cir.
2014); see, e.g., P.R. Hosp. Supply, Inc. v. Bos. Sci. Corp., 426 F.3d 503, 505–06 (1st Cir.
2005); Saks v. Franklin Covey Co., 316 F.3d 337, 349 (2d Cir. 2003); Fruge v. Amerisure
Mut. Ins. Co., 663 F.3d 743, 747 (5th Cir. 2011) (per curiam); Meridia Prods. Liab. Litig.
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v. Abbott Labs., 447 F.3d 861, 865 (6th Cir. 2006); Wachovia Sec., LLC v. Banco
Panamericano, Inc., 674 F.3d 743, 751 (7th Cir. 2012); P&O Nedlloyd, Ltd. v. Sanderson
Farms, Inc., 462 F.3d 1015, 1017 n.3 (8th Cir. 2006); Johnson v. Armored Transp. of Cal.,
Inc., 813 F.2d 1041, 1044 (9th Cir. 1987); Mauldin v. Worldcom, Inc., 263 F.3d 1205,
1211–12 (10th Cir. 2001); Pulte Home Corp. v. Osmose Wood Preserving, Inc., 60 F.3d
734, 739 n.15 (11th Cir. 1995); Jannenga v. Nationwide Life Ins. Co., 288 F.2d 169, 172
(D.C. Cir. 1961); Waner v. Ford Motor Co., 331 F.3d 851, 856 n.2 (Fed. Cir. 2003).
This court is no exception. In Bilancia, we noted that the “failure of the plaintiffs to
object at any time during trial or to except to the charge as required under [Federal Rule of
Civil Procedure] 51 waived any right on their part to complain that the action was
improperly submitted as one controlled by Virginia law.” Bilancia v. Gen. Motors Corp.,
538 F.2d 621, 623 (4th Cir. 1976). Under Bilancia, choice of law is waivable, not
jurisdictional.
This rule makes sense in light of Supreme Court precedent and the consequences of
labeling issues as jurisdictional. Jurisdictional requirements are, of course, important: They
“mark the bounds of a court’s adjudicatory authority” and as such “cannot be waived or
forfeited” and “must be raised by courts sua sponte.” Boechler, P.C. v. Comm’r, 142 S. Ct.
1493, 1497 (2022) (quotation marks omitted). But given that jurisdictional objections can
be raised at any time and may “result in the waste of judicial resources” and “unfairly
prejudice litigants,” the Supreme Court has “tried in recent cases to bring some discipline
to the use of” the jurisdictional label. Henderson ex rel. Henderson v. Shinseki, 562 U.S.
428, 434–35 (2011). Thus the Court has “urged” that an issue “should not be referred to as
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jurisdictional unless it governs a court’s adjudicatory capacity, that is, its subject-matter or
personal jurisdiction.” Id. at 435; see also Boechler, 142 S. Ct. at 1497 (“[W]e treat a
procedural requirement as jurisdictional only if Congress ‘clearly states’ that it is.” (quoting
Arbaugh v. Y&H Corp., 546 U.S. 500, 515 (2006)).
Holding that choice of law is jurisdictional would engraft an additional requirement
onto the statutory prerequisites for diversity jurisdiction that Congress delineated in 28
U.S.C. § 1332: It would not be enough for federal subject-matter jurisdiction that the
parties are diverse and have an amount in controversy greater than $75,000. Rather, a
federal court would only have jurisdiction if the litigation were conducted under the correct
state’s substantive law. To hold as such would defy the Supreme Court’s attempts to bring
“discipline” to the “jurisdictional” label. Henderson, 562 U.S. at 435; see Boechler, 142 S.
Ct. at 1497.
Moreover, labeling choice-of-law issues jurisdictional would have precisely the
negative consequences that the Supreme Court has identified. Choice of law is typically
debated by the parties during the course of litigation—for instance, in competing motions
for summary judgment or proposed jury instructions—much like an affirmative defense. If
choice of law were jurisdictional, a party could refrain from objecting to its adversary’s
choice of law, litigate the entire case based on that law, and then move to dismiss the case
after trial if it loses before the jury. The resulting “waste of judicial resources” and “unfair[]
prejudice” to litigants is obvious. Henderson, 562 U.S. at 434. In short, holding that choice
of law is jurisdictional would create the perfect conditions for sandbagging.
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Thus we reaffirm our conclusion in Bilancia that choice of law is not jurisdictional.
A party abandons any claim that a different state’s law should govern the action if it fails
to raise that issue before or during trial.
B.
AXA waived any contention that this action should have been governed by
Connecticut law. So the district court erred when it applied that law.
AXA litigated this entire case under the substantive law of North Carolina. AXA’s
answer, motion for summary judgment, trial brief, proposed jury instructions, and post-
trial motion to dismiss all either assumed North Carolina law applied or explicitly cited
North Carolina law as governing. As the district court noted, “the parties did not dispute
that North Carolina law governed this negligence claim” prior to post-trial filings. Wiener
v. AXA Equitable Life Ins. Co., No. 3:18-cv-00106-RJC-DSC, 2021 WL 665112, at *3
(W.D.N.C. Feb. 19, 2021). Even AXA’s memorandum of law supporting its post-trial
motion to dismiss asked the court to apply North Carolina law. See Dkt. Entry 131 at 7
(“The controlling statute here is the North Carolina Consumer and Customer Information
Privacy Act, N.C. Gen. Stat. §§ 58-39-5 to -165.”). AXA did not suggest that Connecticut
law might apply until its reply to Wiener’s response to its post-trial motion to dismiss. See
Dkt. Entry 140 at 4 (arguing that Connecticut law would be as fatal to Wiener’s claim as
North Carolina law).
AXA’s failure to object to the application of North Carolina law and affirmative
invocations of that law constitute, for all relevant purposes, a waiver of any argument that
another state’s law should be applied. On appeal, AXA disputes this conclusion based on
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the technical distinction between waiver and forfeiture: “Whereas forfeiture is the failure
to make the timely assertion of a right, waiver is the ‘intentional relinquishment or
abandonment of a known right.’” United States v. Olano, 507 U.S. 725, 733 (1993)
(quoting Johnson v. Zerbst, 304 U.S. 458, 464 (1938)).
While this distinction is relevant, for example, in the context of Federal Rule of
Criminal Procedure 52(b), see id. at 732–33, it makes no difference here. First, “jurists
often use the words interchangeably.” Kontrick v. Ryan, 540 U.S. 443, 458 n.13 (2004). In
fact, in Bilancia, we said that a party’s mere failure to object “waived” choice of law. 538
F.3d at 623. Second, insofar as waiver is distinguished from forfeiture based on the degree
of intentionality involved, we find that AXA’s repeated requests for the district court to
apply North Carolina law fall closer to the waiver end of the spectrum. AXA did not just
fail to timely object to North Carolina law; it affirmatively asked the court to apply that
law by, inter alia, proposing jury instructions that quoted and cited North Carolina law, see
J.A. 245–47, and arguing to the court in its post-trial motions that a North Carolina statute
is “controlling,” Dkt. Entry 131 at 7.
Because both parties consented to the choice of North Carolina law to govern this
action and AXA waived any argument that another state’s law should be applied, the
district court erred when it engaged in its own choice-of-law analysis and decided to apply
Connecticut law. 1 As the Second Circuit has recognized, “where the parties have agreed to
1
We reject AXA’s suggestion that Wiener invited the district court to apply Connecticut
law. Wiener discussed Connecticut’s CIIPPA in his response to AXA’s post-trial motion
in order to explain how North Carolina’s analogous statute operates. See J.A. 963–64. He
did not request that the court throw out his jury verdict and apply Connecticut law instead.
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the application of the forum [state’s] law, their consent concludes the choice of law
inquiry.” Am. Fuel Corp. v. Utah Energy Dev. Co., 122 F.3d 130, 134 (2d Cir. 1997).
“Where neither party argues that the forum state’s choice of law rules require the court to
apply the substantive law of another state, the court should apply the forum state’s
substantive law.” Echo, Inc. v. Whitson Co., 52 F.3d 702, 707 (7th Cir. 1995).
The district court erred when it applied Connecticut law despite AXA’s waiver
because “it is inappropriate for the trial court to dispose of [a] case sua sponte on an
objection . . . which would be waived if not raised by the defendant(s) in a timely manner.”
Sinwell v. Shapp, 536 F.2d 15, 19 (3d Cir. 1976). In the analogous context of waivable
statute-of-limitations defenses, we have explained that “defense[s] waivable by the
inaction of a party” are “hallmarks of our adversarial system of justice, a system in which
the parties are obliged to present facts and legal arguments before a neutral and relatively
passive decision-maker.” Eriline Co. S.A. v. Johnson, 440 F.3d 648, 654 (4th Cir. 2006).
In other words, our adversarial system and “the benefits derived from adhering to the
adversarial process” generally require that courts not revive waived issues. Id. at 655.
“[T]rial courts must be cautious about raising” waived issues sua sponte lest they “erod[e]
the principle of party presentation so basic to our system of adjudication.” Arizona v.
California, 530 U.S. 392, 412–13 (2000).
The district court should not therefore have raised and considered the waived
choice-of-law issue sua sponte. There were no “special circumstances,” Arizona, 530 U.S.
at 412, that would “justif[y] our departure from the general rule” that courts should not
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consider waived issues, Eriline, 440 F.3d at 657. Therefore, the district court’s decision to
apply Connecticut law despite AXA’s waiver “constitutes an error of law.” Id.C.
Even assuming arguendo that it was proper for the district court to apply
Connecticut law, the court was wrong to conclude that the Connecticut Insurance
Information and Privacy Protection Act defeats federal jurisdiction. It is true that when a
statute designates an exclusive non-judicial forum for a category of claim, it divests courts
of jurisdiction over those claims. See Int’l Longshoremen’s Ass’n, AFL-CIO v. Davis, 476
U.S. 380, 390–91 (1986) (explaining that because the National Labor Relations Act places
cases within the “exclusive domain of the National Labor Relations Board,” it governs
choice of forum and divests courts of jurisdiction). But when a statute provides for
exclusive remedies without stripping courts of their adjudicatory powers, it “affects only
the choice of law” and does not oust jurisdiction. Saks, 316 F.3d at 349.
Davis held that “when a state proceeding or regulation is claimed to be pre-empted
by the NLRA . . . the issue is a choice-of-forum rather than a choice-of-law question.” 476
U.S. at 391. Choice-of-forum preemption extinguishes jurisdiction because it affects
courts’ “actual adjudicatory . . . power.” Id. at 391 & n.9. The same is not true of “pre-
emption claims generally,” which affect only the “substantive laws” governing the action.
Id. at 391 n.9. Thus, Davis “made clear that preemption issues that dictate the choice of
forum are jurisdictional and therefore may not be waived, but expressly stated that this rule
does not extend to preemption issues that affect the parties’ choice of law.” Saks, 316 F.3d
at 349 (describing ERISA preemption as a non-jurisdictional choice-of-law issue); accord
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Violette v. Smith & Nephew Dyonics, Inc., 62 F.3d 8, 11–12 (1st Cir. 1995) (noting that
under Davis, when “the question is whether state tort or federal statutory law controls,
preemption is not jurisdictional and is subject to the ordinary rules of appellate
adjudication, including timely presentment and waiver”).
In support of its position that exclusive-remedies statutes defeat jurisdiction, AXA
cites our decision in Evans v. B.F. Perkins Co., 166 F.3d 642 (4th Cir. 1999). Evans held
that because the plaintiff’s sole remedy against his employer was pursuant to the Virginia
Workers’ Compensation Act, the district court properly dismissed his common-law action
for lack of jurisdiction. Id. at 650. But Evans did not address the distinction between choice-
of-forum and choice-of-law statutes, and the Virginia Workers’ Compensation Act created
an administrative forum for workers’ compensation claims: the Virginia Workers’
Compensation Commission. See Va. Code Ann. § 65.2-201(A); see also Banks v. Va. Elec.
& Power Co., No. 99-1392, 2000 WL 191851, at *2 (4th Cir. 2000) (explaining that
“because the plaintiff was the statutory employee of the defendant,” he was “limited to an
action for workers’ compensation benefits before the state’s workers’ compensation
tribunal”).
The Connecticut Insurance Information and Privacy Protection Act is different. It
does not purport by its terms to strip the courts of their basic adjudicatory powers. Quite
the contrary. The statute expressly contemplates that if an insurance company fails to
comply with it, an aggrieved individual “may bring an action for equitable relief” or
damages in court, and “the court may award costs and reasonable attorney’s fees to the
prevailing party.” Conn. Gen. Stat. § 38a-995(a), (b), (c). Thus, courts have the power to
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adjudicate claims covered by CIIPPA—they have jurisdiction—even if certain causes of
action are preempted by that statute. CIIPPA does not affect the court’s “actual
adjudicatory or regulatory power as opposed to the State’s substantive laws” and is
therefore not jurisdictional. Davis, 476 U.S. at 391 n.9.
Because CIIPPA governs choice of law rather than choice of forum and does not
divest courts of jurisdiction, any argument that CIIPPA barred Wiener’s claim was “subject
to the ordinary rules of . . . timely presentment and waiver.” Violette, 62 F.3d at 11–12. As
explained above, AXA waived any argument that CIIPPA preempted Wiener’s claim by
failing to raise it at any point before or during trial. So, even assuming arguendo that the
district court was entitled to apply Connecticut law, it erred when it dismissed Wiener’s
negligence claim as preempted by CIIPPA.
III.
AXA urges us to affirm the district court on the alternative ground that there was
insufficient evidence of injury to support Wiener’s negligence claim. AXA argues that
Wiener’s alleged injury was his categorical uninsurability but the evidence showed that
Wiener received multiple offers of insurance.
We review challenges to the sufficiency of the evidence de novo. Bryant v. Aiken
Reg’l Med. Ctrs. Inc., 333 F.3d 536, 543 (4th Cir. 2003). When the loser of a jury trial
challenges the verdict under Federal Rule of Civil Procedure 50(b), “the question is
whether a jury, viewing the evidence in the light most favorable to [the winning party],
could have properly reached the conclusion reached by this jury.” Id. (quotation marks
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omitted). Because Wiener won at trial, all disputed facts must be construed in his favor and
he must be given the benefit of all reasonable inferences. See Konkel, 165 F.3d at 279.
While the district court dismissed for lack of subject-matter jurisdiction without
reaching AXA’s sufficiency-of-the-evidence challenge, we exercise our “discretion” to
resolve it rather than remand it. Singleton v. Wulff, 428 U.S. 106, 121 (1976). Resolving
rather than remanding this challenge is appropriate because “both parties had ample
opportunity to develop facts pertaining to the issue” over the course of this litigation, “the
issue is primarily a question of law,” it “was briefed and argued on appeal,” and, in our
view, “the proper outcome is beyond doubt, rendering a remand pointless.” Arakas v.
Comm’r, Soc. Sec. Admin., 983 F.3d 83, 105 (4th Cir. 2020) (listing factors we have
considered in determining whether to resolve issues not decided below).
Wiener’s negligence claim was that AXA’s negligent reporting of false medical
information about him to the MIB caused him to become uninsurable. Ample evidence
supported the jury’s verdict for Wiener.
First, AXA does not dispute the jury’s finding that it was negligent. AXA’s
employees falsely reported to an information clearinghouse that Wiener suffered from four
serious medical conditions. They relayed this incorrect and damaging information without
even conducting basic inquiries—like consulting Wiener’s primary care doctor or
reviewing the follow-up tests in Wiener’s medical records—to determine whether those
diagnoses were accurate.
Second, Wiener presented evidence from which a reasonable jury could conclude
that he became uninsurable. While AXA asserts that Wiener’s theory of injury was that he
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became “categorically” uninsurable, there is no evidence in the record that Wiener’s
proffered injury was “categorical” uninsurability. Wiener never argued that he became
“categorically” uninsurable or uninsurable “at any price.” Br. of Appellee at 3. Rather, in
denying AXA’s motion for summary judgment and allowing this case to proceed to trial,
the district court concluded that “there is a genuine dispute of fact as to whether the MIB
codes effectively rendered Plaintiff uninsurable or insurable at a significantly increased
cost.” J.A. 235 (emphasis added). We have no doubt that someone who could obtain a $16
million life insurance policy only by paying annual premiums of $15,999,999 can be
considered uninsurable. A reasonable jury could conclude that someone is effectively
“uninsurable” when he cannot obtain insurance at a reasonable price.
Wiener presented evidence that he became effectively uninsurable. Sanford
Robbins, who was Wiener’s insurance agent and had thirty-seven years of experience,
testified about his unsuccessful efforts to obtain a replacement $16 million policy for
Wiener at the standard rate, which is “the rate that a typical person would obtain if they
were healthy.” J.A. 1372. Out of eight insurance applications, six carriers declined
coverage altogether while two made preliminary, revocable offers for a $10 million policy
at double the standard rate—which would have cost Wiener an extra $400,000 per year. Id.at 1370–73. The jury could properly have concluded from this evidence that Wiener had
become effectively uninsurable or uninsurable at a reasonable cost.
Finally, Wiener presented evidence showing that the erroneous MIB codes that
AXA reported caused his uninsurability. An expert witness, Stephen Burgess, testified that
life insurance companies look at MIB codes early in determining whether to begin the
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underwriting process and would be deterred from starting the process if the applicant had
MIB codes “of significant concern.” Id. at 1582. He testified that one of the erroneous MIB
codes that AXA reported would be a “hot button[]” and a “deal killer for an insurance
company.” Id. at 1581. And Wiener’s agent, Robbins, testified that in speaking with
insurance carriers whom he had contacted about Wiener’s application, he “was told that
the Medical Information Bureau file had a coding in it that created an underwriting issue,”
which would prevent carriers from issuing a policy at the standard rate. Id. at 1372.
In sum, we do not lightly disturb jury verdicts on the basis of insufficient evidence,
and we will not do so for a challenge as insubstantial as AXA’s. The able district judge
conducted a well-run trial during which Wiener presented sufficient evidence from which
a reasonable jury could conclude that AXA’s negligent reporting of erroneous MIB codes
caused him to be become effectively uninsurable. The jury properly performed its function
when it resolved these disputed facts in Wiener’s favor. AXA’s contrary arguments lack
merit, so we decline to affirm the district court’s dismissal on this alternative ground.
IV.
The district court erred by applying Connecticut law despite both parties’ choice to
litigate under North Carolina law. It also erred by concluding that Connecticut’s CIIPPA
divested it of subject-matter jurisdiction despite that statute affecting only choice of law
rather than choice of forum. AXA’s alternative argument for affirmance based on the
nature of Wiener’s injury and its causation was thoroughly briefed and argued before us,
and we find it to be without merit. But because AXA’s argument for post-trial relief
challenging the amount of damages, see J.A. 954, was neither raised nor briefed before this
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USCA4 Appeal: 21-2165 Doc: 50 Filed: 01/20/2023 Pg: 18 of 18
court, we think the better course is to remand to the district court to consider that issue in
the first instance, see Hillman v. IRS, 263 F.3d 338, 343 (4th Cir. 2001).
REVERSED AND REMANDED
18