United States District Court, N.D. California
ORDER DENYING SUMMARY JUDGMENT DKT. NO. 36
Gonzalez Rogers, United States District Court Judge
Joyce Goertzen brings the instant putative class action
alleging claims for violation of California Business &
Professions Code section 17200 et seq.,
California's Unfair Competition Law (“UCL”),
and the financial elder abuse provisions of California
Welfare and Institutions Code section 15600 et seq.
Plaintiff alleges that defendant Great American Life
Insurance Company (“Great American”) engaged in
systematic unlawful sales practices in connection with sales
of individual life insurance and annuity contracts to senior
purchasers in California. Plaintiff alleges that Great
American policies contain hidden penalties associated with
surrender of the policy prior to maturity, which were not
disclosed consistent with California Insurance Code sections
10127.10 and 10127.13. The complaint herein was originally
filed in the Superior Court of the State of California,
County of Alameda, and defendants removed to this Court on
the grounds that original jurisdiction under 28 U.S.C.
section 1332 and the Class Action Fairness Act (CAFA).
Great American now moves for summary judgment on both claims,
contending that plaintiff cannot establish that she has
standing either under Article III of the United States
Constitution or under section 17204 of the UCL because she
cannot show that the alleged unlawful conduct caused her
carefully considered the papers submitted, the admissible
evidence, and the pleadings in this action, and for
the reasons set forth below, the Court Denies the Motion for
Summary of Facts
2011, when plaintiff Joyce Goertzen was 80 years old, she
purchased a Great American fixed indexed deferred annuity
from an independent insurance agent, Michel Hollender.
(Thomas Evans Decl., Exh. 2.) A deferred annuity is a
financial insurance product with a long-term maturation
period. The Great American fixed indexed deferred annuity
Goertzen purchased included surrender charges, or penalties,
if the owner “surrenders, ” i.e.,
withdraws more than 10% of the account value of the annuity
in any one year during the first ten years. The surrender
charges decrease incrementally each year, but apply
throughout the period.
Goertzen made a withdrawal from her deferred annuity policy
in 2015 and was assessed a surrender penalty of $136.88.
(Ingrid Evans Decl., Exh. C at No. 22 and Exh. E.) The
disclosure found on the policy jacket for Goertzen's
annuity did not reference “surrender charges, ”
but did mention “early withdrawal charges, ”
Please refer to your disclosure document for the Safe Return
early withdrawal charge schedule. Charges are applied during
the early withdrawal charge period to amounts withdrawn in
excess of the 10% penalty-free withdrawal allowance; to
amounts annuitized, where payments are made for less than 10
years; and to full surrenders.
(Ingrid Evans Decl., Exh. F.) The cover page of her annuity
included a paragraph headed “TWENTY DAY EXAMINATION -
RIGHT TO CANCEL, ” which stated that the contract could
be cancelled with written notice until midnight of the
twentieth day following receipt of the contract, “or
such later date as may be required by law.” (Thomas
Evans, Exh. 2.) It also included the following statement:
IMPORTANT: YOU HAVE PURCHASED AN ANNUITY CONTRACT. CAREFULLY
REVIEW IT FOR LIMITATIONS. IF ON THE DATE OF ISSUE YOU ARE
AGE 60 OR OLDER, THIS CONTRACT MAY BE RETURNED WITHIN THIRTY
(30) DAYS FROM THE DATE YOU RECEIVED IT FOR A FULL REFUND BY
RETURNING IT TO THE INSURANCE COMPANY OR PRODUCER WHO SOLD
YOU THIS CONTRACT. AFTER THIRTY (30) DAYS, CANCELLATION MAY
RESULT IN A SUBSTANTIAL PENALTY, KNOWN AS A SURRENDER CHARGE.
(Id., formatting and emphasis in original.)
declares that he reviewed and explained the surrender charges
that applied to the Great American annuity he sold to
Goertzen. (October 24, 2016 Hollender Decl. at ¶¶
4, 5, 8.) Goertzen testified that she did not recall
Hollender explaining surrender charges. (Ingrid Evans Decl.,
Exh. B. [Goertzen Depo.] at 28:3-17, 34:17-35:21; 14:5-7.)
Indeed, she testified that she did not recall Hollender
visiting her in relation to the Great American annuity or
discussing any of its terms with her. (Thomas Evans Decl.,
Exh. 1 [Goertzen Depo.] at 25:6-27:6.) For his part,
Hollender was unable to locate the notes for Goertzen's
sale, though he normally kept such notes on all his
judgment is appropriate when there is no genuine dispute as
to any material fact and the moving party is entitled to
judgment as a matter of law. Fed.R.Civ.P. 56(a). Any party
seeking summary judgment bears the initial burden of
identifying those portions of the pleadings and discovery
responses that demonstrate the absence of a genuine issue of
material fact. Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986). Material facts are those that might affect
the outcome of the case. Anderson v. Liberty Lobby.
Inc., 477 U.S. 242, 248 (1986). A dispute as to a
material fact is “genuine” if there is sufficient
evidence for a reasonable jury to return a verdict for the
nonmoving party. Id.
issue where the nonmoving party will bear the burden of proof
at trial, as here, the moving party can prevail merely by
pointing out to the district court that there is an absence
of evidence to support the nonmoving party's case.
Celotex, 477 U.S. at 324-25. If the moving party
meets its initial burden, the opposing party must then set
out specific facts showing a genuine issue for trial in order
to defeat the motion. Anderson, 477 U.S. 242, 250;
Soremekun v. Thrifty Payless, Inc., 509 F.3d 978,
984 (9th Cir. 2007); see also Fed. R. Civ. P. 56(c),
(e). A court may only consider admissible evidence in ruling
on a motion for summary judgment. See Fed.R.Civ.P.
56(c)(2); Beyene v. Coleman Sec. Servs., Inc., 854
F.2d 1179, 1181 (9th Cir.1988) (“It is well settled
that only admissible evidence may be considered by the trial
court in ruling on a motion for summary judgment.”).
However, when deciding a summary judgment motion, “the
court does not make credibility determinations or weigh
conflicting evidence.” Soremekun, 509 F.3d at
984. Instead, the court must view the evidence in the light
most favorable to the nonmoving party and draw all
justifiable inferences in its favor. Anderson, 477
U.S. at 255; Hunt v. City of Los Angeles, 638 F.3d
703, 709 (9th Cir.2011).