Baton Rouge, Louisiana – A federal court has ruled in favor of the insured client of J. Price McNamara, Disability, Life, AD&D Insurance Attorney in his ERISA accidental dismemberment insurance lawsuit against The Lincoln National Life Insurance Company, reversing Lincoln’s denial of benefits and awarding full benefits, plus interest and court costs.

The case arose from a devastating August 2021 accident in Port Aransas, Texas. According to the record, Mr. Sewell made a shallow dive from the back of a bay boat after watching others nearby diving and swimming in what appeared to be safe water, only to strike an unseen sandbar hidden beneath murky water. He suffered permanent quadriplegia.

Lincoln denied benefits under an alcohol-related exclusion. But the court rejected Lincoln’s handling of the claim, finding that Lincoln’s review was not “fair, impartial, and thorough.”

In particularly strong language, the court said Lincoln’s experts took “a one-sided view of the record,” while “elevating second-hand double hearsay in unsworn medical records over first-hand eyewitness affidavits.”

The court also pointed to what it described as “[c]onducting a result-oriented review,” “wholesale disregard of eyewitness affidavits” by Lincoln’s toxicology expert, and Lincoln’s disregard of evidence showing that Sewell carefully prepared to dive and showed no signs of impairment.

The ruling further noted that the blood alcohol test Lincoln relied on was “an outlier in the evidence” and that “no evidence corroborates the blood alcohol test results.” The court held that Lincoln improperly treated the test as effectively dispositive, even though the record evidence rebutted it.

The court found that the surrounding evidence showed the true cause of the injury was “an unanticipated geographical under-water drop-off that was not visible prior to his dive,” and that “the mechanism of his injury was not caused by any impairment.”

The court also criticized Lincoln’s broader claims process, observing that Lincoln’s experts did not adequately account for contradictory evidence, that “reciting review of all of the evidence is not equivalent to properly considering it,” and that the timeline of Lincoln’s denials showed “the adversarial nature of the process, in which [the insured’s] evidence is repeatedly excluded from consideration.”

Finally, the court held that this case involved substantial direct evidence and that “[t]o disregard this direct evidence out-of-hand in favor of contrary inferences constitutes an abuse of discretion.”

From attorney J. Price McNamara: “This ruling highlights that for an intoxication exclusion requiring that alcohol played a causal role in the accident, insurers cannot simply presume causation from a blood test. Rather it is the insurer’s burden to show that the surrounding facts support alcohol playing a causal role.” 

CASE INFORMATION

United States District Court, Southern District of Texas, Corpus Christi Division
Timothy Sewell v. The Lincoln National Life Insurance Company
Civil Action No. 2:23-cv-00317