6th U.S. Circuit Court of Appeals; Case #15-1612
Judges Sutton, Kethledge and Beckwith (sitting by designation); Opinion by Judge Kethledge
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Requirement That Benefits Were Unreasonably Delayed or Denied [§3148(1)]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this Federal written Opinion by Judge Kethledge involving a plaintiff's request for penalty attorney fees under MCL 500.3148(1), the 6th Circuit held that defendant unreasonably delayed payment of PIP benefits and, as a result, plaintiff was entitled to penalty attorney fees because plaintiff had provided reasonable proof of his need for the benefits and defendant failed to "evaluate that proof."
Plaintiff suffered injuries in an auto accident, including one that required amputation of his leg above the knee. Plaintiff later suffered further injury after stepping into a hole on his own property. Defendant Travelers had paid PIP benefits for plaintiff's attendant-care services but denied plaintiff's claim for additional benefits, asserting it had fully paid all the benefits to which plaintiff was entitled. Plaintiff filed this action in U.S. District Court for the Eastern District of Michigan, arguing that Travelers unreasonably refused to pay, or unreasonably delayed paying, additional benefits. Plaintiff and Travelers later settled the PIP benefits claim. Therefore, the only issue was plaintiff's motion for penalty attorney fees under §3148(1). Relying on Moore v Secura Ins, 482 Mich 507 (2008), where the Michigan Supreme Court said that "an insurer acts at its own risk in terminating benefits in the face of conflicting medical reports," the Eastern District found that Travelers failed to evaluate the proofs that were submitted and that Travelers acted unreasonably in refusing to timely pay plaintiff's benefits. Therefore, the Eastern District held that plaintiff was entitled to penalty attorney fees pursuant to §3148(1).
The 6th Circuit affirmed on appeal, also relying on Moore. The Court said:
"As the district court noted, ... Dr. Gronek's [medical] reports 'provided an extensive amount of information in regard to [Dixon's] upper extremities from which [Travelers] could have made a proper evaluation.' The court concluded that Travelers failed to evaluate the information that Dr. Gronek submitted on the Dixons' behalf, and hence that Travelers had not met its obligation under Moore to 'evaluate the evidence submitted by Dr. Gronek before making a reasonable decision.'"
The 6th Circuit pointed out that Travelers did not contest the factual predicate of the Eastern District's conclusion — that it failed to evaluate the evidence submitted by Dr. Gronek. In this regard, the Court stated:
"But that predicate disposes of this case. Per the Michigan Supreme Court's decision in Moore, Travelers could make a reasonable decision to terminate the Dixons' attendant-care benefits only after it evaluated both Dr. Femminineo's and Dr. Gronek's opinions. Travelers did not do that here, and thus under Moore the Dixons are entitled to fees."
The 6th Circuit further rejected Travelers argument that, under Moore, the opinion of another doctor (Dr. Femminineo), "standing alone," could preclude a finding of unreasonableness in the decision to terminate benefits. The Court said:
"Moore stands for a narrower proposition: when an insurer receives conflicting opinions concerning the necessity of certain medical care, it 'need not resort to a "tie breaker" [by] . . . seek[ing] out another physician to prepare yet another [evaluation] in order to reconcile the conflicting opinions.' ... What the insurer must do, rather, is conduct a reasoned evaluation that takes both opinions into account. And again Travelers did not do that here."
