United States District Court, D. South Dakota, Western Division
JEFFREY L. VIKEN, CHIEF JUDGE
Annie Tovares filed an action against the defendants
Gallagher Bassett Services, Inc., and Praetorian Insurance
Company alleging bad faith and misrepresentation in violation
of South Dakota law. (Docket 1). Defendants filed separate
answers to plaintiff's complaint. (Dockets 37 & 39).
Defendants filed a motion for summary judgment, together with
a brief, an affidavit with nine exhibits and defendants'
statement of undisputed material facts. (Dockets 62, 63, 64,
64-1 through 64-9 & 65). Plaintiff filed a responsive
brief, together with plaintiff's response to
defendants' statement of undisputed facts with ten
exhibits and plaintiff's declaration in support of
Fed.R.Civ.P. 56(d) discovery. (Dockets 67, 67-1 through 67-10,
68 & 70). Defendants filed a reply brief with one exhibit
in support of their motion for summary judgment. (Dockets 72
filed a motion seeking leave to file supplemental authority,
a supporting brief and one case. (Dockets 78, 78-1 & 79).
Defendants filed a brief in response to plaintiff's
motion. (Docket 82).
reasons stated below, plaintiff's motion to file
supplemental authority is granted, defendants' motion for
summary judgment is granted in part and denied in part, and
plaintiff's motion for Rule 56(d) discovery is denied as
Fed.R.Civ.P. 56(a), a movant is entitled to summary judgment
if the movant can “show that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a). Once
the moving party meets its burden, the nonmoving party may
not rest on the allegations or denials in the pleadings, but
rather must produce affirmative evidence setting forth
specific facts showing that a genuine issue of material fact
exists. Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 256 (1986). Only disputes over facts that might affect
the outcome of the case under the governing substantive law
will properly preclude summary judgment. Id. at p.
248. “[T]he mere existence of some alleged
factual dispute between the parties will not defeat an
otherwise properly supported motion for summary judgment; the
requirement is that there be no genuine issue of
material fact.” Id. at 247-48
(emphasis in original).
dispute about a material fact is genuine, that is, if the
evidence is such that a reasonable jury could return a
verdict for the nonmoving party, then summary judgment is not
appropriate. Id. However, the moving party is
entitled to judgment as a matter of law if the nonmoving
party failed to “make a sufficient showing on an
essential element of her case with respect to which she has
the burden of proof.” Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). In such a case,
“there can be ‘no genuine issue as to any
material fact,' since a complete failure of proof
concerning an essential element of the nonmoving party's
case necessarily renders all other facts immaterial.”
Id. at p. 323.
determining whether summary judgment should issue, the facts
and inferences from those facts must be viewed in the light
most favorable to the nonmoving party. Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88
(1986). The key inquiry is “whether the evidence
presents a sufficient disagreement to require submission to a
jury or whether it is so one- sided that one party must
prevail as a matter of law.” Anderson, 477
U.S. at pp. 251-52.
following recitation consists of the material facts developed
from the complaint (Docket 1), defendants' answers
(Dockets 37 & 39),  the parties' statements of
undisputed material facts (Dockets 65 & 67) and other
evidence where indicated. Where a statement of fact is admitted
by the opposing party, the court will only reference the
initiating document. These facts are “viewed in the
light most favorable to the [party] opposing the
motion.” Matsushita Elec. Indus. Co., 475 U.S.
at 587. The facts material to defendant's
motion for summary judgment are as follows.
Annie Tovares works at Menards in Rapid City, South Dakota.
(Docket 67-1 ¶ 1). On Wednesday, March 19, 2014, she
fell at work. Id. ¶ 3. One of Menards'
surveillance cameras recorded her fall. Ms. Tovares did
not hit her head, but she immediately felt dazed, disoriented
and like her brain got jarred. Id.¶ 4. It took
a few minutes to collect herself. Id. ¶ 5.
following Tuesday, Ms. Tovares had a bloody nose at work and
that night she had blurry vision and a sharp ringing in her
ears. Id. ¶ 6; see also Docket 67-2 at
p. 4. At work the following morning the lights hurt Ms.
Tovares' eyes and head. (Docket 67-1 ¶ 7). She felt
dizzy and was worried something serious happened because of
her fall. Id. She spoke to her supervisor and went
to the emergency room at the Rapid City Regional Hospital in
Rapid City, South Dakota. Id.; see also
Docket 67-2 at p. 4. After visiting the ER, Ms. Tovares went
to see her ophthalmologist at Wright Vision Center.
Id. ¶ 9; see also Docket 65 ¶ 29.
As instructed by the ER physician, Ms. Tovares took a couple
of days off work. (Docket 67-1 ¶ 14; see also
Docket 65 ¶ 30).
Tovares' bill for the hospital services, CT scan and ER
activities totaled $2, 513. (Dockets 67-2 at p. 71; 67-3 at
p. 4). The bill from Wright Vision Clinic was $185. (Docket
67-3 at p. 6). Dakota Radiology billed Ms. Tovares $165.
Id. at p. 3. Ms. Tovares borrowed money to pay the
medical bills and submitted a worker's compensation claim
for these expenses. (Docket 67-1 ¶ 15).
Praetorian Insurance Company (“Praetorian”)
issued a policy of worker's compensation insurance to Ms.
Tovares' employer, Menards, Inc. (Docket 1 ¶ 6).
Gallagher Bassett Services, Inc. (“GBS”) is the
claim administrator which handled Ms. Tovares' claim for
Praetorian. (Docket 67-1 at p. 8).
Manwaring was the adjustor assigned by GBS to handle Ms.
Tovares' workers' compensation claim. (Docket 67-2).
Ms. Manwaring's notes of her telephone contact with Ms.
Tovares on March 31, 2014, contain plaintiff's
description of her incident at Menards:
She ws done, pulling a box off the cart, next she new she was
on the floor. She's not sure how it happened. Thinks L.
foot slipped, hit L. hip, L. underarm struck the box she was
handling, and it was scraped and bruised. Initially she was
in so much pain she couldn't believe it. The impact of
her body hitting the concrete, maybe the weight of the box
made her fall even harder. She did not strike her head,
however once she stood up, he whole body was vibrating. She
knows she jarred her brain. She just stood there to try and
re-gain her “marbles” says she was in shock. Once
the pain subsided, she felt fine. She didn't have any
broken bones. Physically she feels fine. A week later, she
began experiencing lightheadedness and dizziness. Equilibrium
was off. Numerous time of ringing in her head. Went to doctor
on 3/26, and doctor asked which ear was ringing, she
couldn't tell. Vision is slightly blurry and pain in her
head. She's been better the last few days. Went to ER on
3/26/2013 b/c that morning when she went to work the bright
lights in the building hurt her head and eyes. While she was
at ER, the did a CT scan. They said everything was negative.
But she was highly disappointed in the hospital staff. Never
asked to see her bruises, no x-rays of her body were done.
She felt like they didn't believe what happened to her.
Up until that day, she had had a sharp ringing in her head,
then went away. That night she had some minor ringing in
head, so she knows she jarred her brain and she knows that
can cause problems down the road. She had a minor cold about
a month ago. Does not suffer from allergies/sinus issues. She
did receive a call the next day to see how she was feeling.
FU with optimologist [sic] ¶ 3/26/2014 and told her
everything looked fine. She was concerned about the lens
(Docket 67-2 at p. 10; see also Docket 65 ¶
records obtained by GBS contain the following history of Ms.
Tovares present illness:
Patient is a 64-year-old female who presents with blurred
vision. She states that a week ago she fell and landed on her
left hip and left elbow. She denies shooting her head at that
time. Over the past week since the fall she has had
intermittent blurred vision and ringing in her years. She has
also had an intermittent sharp headache but has not required
medication as the heading duration he was very brief. She
denies numbness, tingling, or weakness. No vertigo or
lightheadedness. She denies pain otherwise. A month ago she
saw ophthalmology and they stented her left tear duct for dry
(Docket 67-2 at p. 57; see also Docket 65
¶¶ 9-10). A CT scan of Ms. Tovares' head
reported “[v]entricles and sulci are normal. There is
no intracranial hemorrhage or mass. No bony abnormality
identified.” (Docket 67-2 at p. 58). The CT report
concluded “[n]ormal CT head.” Id.;
see also Docket 65 ¶ 28. ER physician Dr.
Donald Neilson charted “[t]he most likely cause of her
symptoms is that they are related to a head injury. She is
comfortable with discharge and will follow up with her
primary physician.” (Docket 67-2 at p. 59). A
Registered Nurse signed an “Excused Absence from Work
and School, ” excusing Ms. Tovares from work for two
days. Id. at p. 47.
instruction sheet given to Ms. Tovares at discharge from the
ER contained the following caution:
You have had a head injury which does not appear serious at
this time. A concussion is a state of
changed mental ability, usually from a blow to the head. You
should take clear liquids for the rest of the day and then
resume your regular diet. You should not take sedatives or
alcoholic beverages for 48 hours after discharge. After
injuries such as yours, most problems occur within the first
Id. at p. 45 (emphasis in original). The
“minor symptoms” which may occur included
“dizziness, ” “headaches” and
“double vision.” Id. (capitalization
omitted). Under “Home Care Instructions, ” the
instruction sheet stated “[s]ide effects may occur up
to 7-10 days following the injury. It is important for you to
carefully monitor your condition and contact your caregiver
or seek immediate medical attention if there is a change in
your condition.” Id. (bold and capitalization
April 10, 2014, Ms. Manwaring noted in the claim file that
the “[r]eserves are appropriate for probable ultimate
cost. No changes are warranted at this time. Claimant has not
lost anytime from work and medical reserves reflect
conservative care.” (Docket 67-2 at p. 15). Regarding
resolution and closure of the claim file, Ms. Manwaring noted
“[o]nce claimant is placed at MMI [maximum medical
improvement], file can be prepared for closure as no
permanency is anticipated. File closure may be viable within
90 days if claimant reaches MMI in the near future.”
Id. Her recommendations for management of the claim
file included the following:
1. Build rapport with claimant to avoid litigation.
2. Obtain updated medical reports and outline recommended
treatment plan in the file. Push for eventual MMI release.
3. Document completion and submission of all state forms and
4. Complete initial investigation and document compensability
decision in the file notes in 010 note.
5. Complete updated POA no later than 5/6/14.
April 23, 2014, Ms. Manwaring sought permission to deny Ms.
Tovares' claim. In that request, she stated in part the
The claimant maintains she did NOT hit her head when she
fell. The ER notes indicate her complaints are likely from a
head injury. Claimant was referred to eye doctor for FU due
to blurred vision. These notes have also been received and
indicate the claimant had had her tear ducts stinted one
month prior as well as previous cataract surgery. There were
no issued found. Requesting authority to deny file based on
claimant's treatment appearing to have no relation to her
Id. at p. 17 (capitalization in original); see
also Docket 65 ¶ 12). Ms. Manwaring's
supervisor, Angela Smith, agreed. “Reviewed the file
with adjuster and agree with recommendation for denial due to
the head complaints not being related to her work incident. .
. . Review and approval of the denial sent to ABM [Assistant
Branch Manager], Dorothy Stolle this date.” (Docket
67-2 at pp. 17-18). On April 29, 2014, Ms. Stolle authorized
closing the file. “Agree with denial of file at this
time as medical diagnosis does not relate to work
injury.” Id. at pp. 18-19.
April 30, 2014, Ms. Manwaring sent Ms. Tovares a letter on
GBS letterhead. (Docket 67-2 at p. 63). The letter stated in
part: “We have investigated this claim and found no
evidence to support your claim for benefits under South
Dakota Workers' Compensation provisions. We must,
therefore, accordingly deny your claim.” Id.
16, 2014, Attorney Michael Simpson advised Ms. Manwaring he
was representing Ms. Tovares on her claim. (Docket 67-2 at p.
84; see also Docket 65 ¶ 15). Ms. Manwaring
responded to Attorney Simpson on May 28, 2014. (Docket 67-2
at p. 85). She provided him with the medical records which
GBS obtained and advised him “[a]s the surveillance
video is property of Menard, Inc., a subpoena will be
required in order to release the information to you.”
Id. She also wrote: “[p]lease note, your
client acknowledges she did not strike her head in her fall.
She presented to the ER on week later at which time a CT scan
was obtained and negative for a head injury. She was
diagnosed with blurred vision and headache and referred to
her optometrist for FU.” Id.
September 17, 2014, Ms. Manwaring sent a follow-up letter to
Attorney Simpson. Id. at p. 77. In part, her letter
asked, “[t]o date we have received no further response
from you. Can you please verify whether or not you still
represent Ms. Tovares, and, if so, where you are with your
investigation of her claim?” Id.; see
also Docket 65 ¶¶ 16-17.
October 9, 2014, Attorney Simpson wrote Ms. Manwaring.
(Docket 67-2 at pp. 78-79). After summarizing the content of
their previous correspondence, he wrote:
In addition, you do not mention in your May 28th
letter my request for a recorded statement of Ms. Tovares or
other recorded statements or other information which supports
Clearly, the video tape is discoverable and I need this
information in order to represent Ms. Tovares and give her
good legal advice about whether or not her medical bills
should be paid by workers' compensation. In addition, her
recorded statement and any other recorded statements are
relevant to this question as well.
If you do not provide me with the video tape and the recorded
statement or statements, then I am forced to file a petition
for hearing with the state Department of Labor in order that
I can get this information.
I am going to calendar this for seven (7) days or until
Thursday, October 16, 2014. If you do not provide me with the
video and the recorded statement or statements by that time,
I will be forced to file a petition for hearing with the
state Department of Labor in order to get this information
and in order to challenge your denial.
Please be advised that if I have to do this, I will be asking
the Department of Labor for my attorney fees, as I believe it
is unreasonable for you to withhold important information and
force the Claimant to file a petition for hearing.
As I am sure you are aware, this claim only concerns medical
bills and therefore it is very difficult for people such as
Ms. Tavares to get lawyers to take on these claims, as it is
financially difficult to do so. By withholding important
evidence, you force Ms. Tovares to take legal action, which
makes it very difficult for her (and other people like her)
to simply get the evidence needed to determine whether their
claim is valid.
I do not want to waste the Department of Labor's time
with a formal petition if I do not have to. Please reconsider
your decision to not provide me with important evidence
concerning compensability. Thank you.
October 20, 2014, Attorney Simpson filed a petition for
hearing with the South Dakota Department of Labor and
Regulation, Division of Labor and Management, Worker's
Compensation on Ms. Tovares' behalf. (Docket 67-2 at pp.
80-83; see also Docket 65 ¶ 18). On November
12, 2014, Praetorian filed an answer admitting Ms. Tovares
fell on March 19, 2014, and that she sought medical attention
on March 26, 2014. (Docket 1 ¶ 32).
January 31, 2015, Attorney Daniel Ashmore, as attorney for
Praetorian, e-mailed Attorney Simpson. (Docket 67-3 at pp.
16-17). Attorney Ashmore asked “[c]an we resolve this
case for $2, 500 for a full and final? That should allow her
to get the bills paid and something for you. Let me
know.” Id. at p. 17.
February 6, 2015, after talking with Ms. Tovares, Attorney
Simpson rejected the $2, 500 offer. Id. at p. 16. He
attached a summary of the bills to date and agreed to get the
Wright Vision Center bill to Attorney Ashmore. Id.
Attorney Simpson indicated “the bills plus interest
total over $3, 000, not including the Wright ...