Opinion
B315018
07-20-2023
GAYK BAGRAMYAN, Plaintiff and Appellant, v. GOVERNMENT EMPLOYEES INSURANCE COMPANY, Defendant and Respondent.
Stiller Law Firm, Ari J. Stiller; Moss Bollinger and Ari Moss for Plaintiff and Appellant. Sheppard, Mullin, Richter &Hampton, John T. Brooks, Jared K. LeBeau and Matthew G. Halgren for Defendant and Respondent.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County No. 19STCV24949, Stephen I. Goorvitch, Judge. Affirmed.
Stiller Law Firm, Ari J. Stiller; Moss Bollinger and Ari Moss for Plaintiff and Appellant.
Sheppard, Mullin, Richter &Hampton, John T. Brooks, Jared K. LeBeau and Matthew G. Halgren for Defendant and Respondent.
EGERTON, J.
Gayk Bagramyan made a claim with his insurance company, Government Employees Insurance Company (GEICO), after his car allegedly suffered extensive damage from driving over a metal object on the freeway. GEICO identified several "red flags" with the claim-among other things, Bagramyan did not call the police, towed the car to an auto body shop he owned, and had trouble recalling the date of the incident-and it retained an expert to inspect the car. The expert concluded the damage was "grossly inconsistent" with Bagramyan's account and observed some of the damage appeared to have been man-made. Based on that report, GEICO denied the claim.
Bagramyan then brought an action against GEICO, asserting it denied his claim in bad faith. The trial court granted GEICO's motion for summary adjudication of the bad faith claim and request for punitive damages. Bagramyan then voluntarily dismissed the rest of his action. On appeal, Bagramyan argues the court erred because he submitted sufficient evidence to survive summary adjudication. We disagree and affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
The following facts are undisputed:
1. Bagramyan's claim
Bagramyan owned a 2014 Mercedes Benz, which he insured under his sister-in-law's GEICO insurance policy. On June 6, 2018, Bagramyan made a claim under the policy, asserting his car had been damaged when he drove over a metal object in the road.
A few hours after receiving Bagramyan's claim, a GEICO employee made a "[Special Investigations Unit] Note" in the case file as part of a "proactive review" of the claim. The note indicated a detailed recorded statement from Bagramyan would be required, and it suggested questions to ask during the interview.
2. GEICO's investigation and claims decision
GEICO's claims examiner, Sharon Paniagua, interviewed Bagramyan on Thursday, June 7, the day after he made the claim. Bagramyan initially told Paniagua the incident occurred on June 4, which he believed was a Sunday. Paniagua responded that Sunday was the 3rd of June, to which Bagramyan replied, "I think it was Monday wasn't it?" Bagramyan then said the incident actually occurred on Tuesday, June 5.
According to Bagramyan, the incident occurred while he was driving in the far-right lane of the 134 freeway sometime between 9:30 and 10:00 p.m. The car in front of him swerved to the side, and before Bagramyan could react, he drove over a large metal object in the road. Bagramyan explained the impact "felt very bad" and he "thought [he] was going to roll over."
Bagramyan pulled over to the shoulder and turned off his car. The car would not start back up, and Bagramyan smelled gasoline. He noticed that the collision "took the bumper, like, kind of underneath was broken. Something [was] hanging there." He called a tow truck driver and had the car towed to an auto body repair shop that Bagramyan owned. Bagramyan did not call the police.
GEICO's auto damage adjuster inspected the car the next day and determined the repairs would cost over $26,000. The adjuster concluded it would not be economically feasible to make the repairs because the car's estimated fair market value was $34,000.
After its initial investigation, GEICO assigned the claim to Dave Ramirez, who is an investigator in its Special Investigations Unit. During his investigation, Ramirez discovered Bagramyan had made seven insurance claims between 2006 and 2016, six of which involved collisions. Ramirez also discovered two prior insurance claims for the Mercedes Benz: a June 2016 comprehensive claim for vandalism and a July 2015 collision claim. The car also had been impounded in 2014 and 2017.
Ramirez interviewed Bagramyan on June 18. Bagramyan told Ramirez he owned an auto body repair shop and had been in the auto repair business for 20 years. He said he purchased the Mercedes Benz for about $22,000 in cash about a year earlier, after someone walked into his shop and offered to sell it to him. The car was "clean" with no prior accidents. After buying the car, Bagramyan took it to a dealership because a dashboard light was illuminated. The car was still under warranty, and the dealership fixed the problem.
Bagramyan told Ramirez the incident occurred while he was on his way to his sister's house. Bagramyan drove directly over the object in the road, which "kind of pushed [him] to the right." The object was also "pushed" to the right side of the road. Asked if he noticed any damage to the car, Bagramyan said he "couldn't see anything" because it was dark. Bagramyan said he "should have" taken pictures, but he has an "anxiety problem" and was "very panicked."
Bagramyan decided to tow the vehicle to his shop because he initially thought the damage would be minor. He called a tow truck driver he knew and paid the driver $460 in cash. Bagramyan's insurance policy included tow coverage, but Bagramyan did not know that at the time. Bagramyan did not call the police because he did not think it was necessary. Nor did he call his sister, explaining she had not known he was driving to her house.
Bagramyan said the only evidence he could provide to substantiate his claim was the invoice for the tow truck company, which he gave to GEICO sometime after the interview. Bagramyan also provided GEICO the call logs for his phone, which showed an outgoing call to the tow company at 9:52 p.m., and an incoming call from the same number at 10:11 p.m. Ramirez called two phone numbers listed on the tow invoice. No one picked up at either number, so Ramirez left messages requesting a call back. GEICO never received a call from either number.
On Ramirez's recommendation, GEICO retained an accident reconstruction expert, Sean Shideh, to inspect the car and opine on the cause of the damage. Ramirez had retained Shideh to work on at least one other investigation, but he could not recall if he had used Shideh on other occasions. Ramirez felt confident selecting Shideh because he was a GEICO vendor, and he understood that GEICO performs thorough background checks on its vendors.
After inspecting the car, Shideh provided GEICO a report in which he found the "undercarriage and body panels indicated the evidence to be grossly inconsistent with the report of the incident. There was no evidence of impact damages to the front exterior profiles, suspension, and undercarriage components from the [car] running over an object(s) on the road, as claimed by the insured."
Shideh attached to his report 61 annotated color photographs of the car. According to the annotations, several photographs show "[c]risscrossed, longitudinal scuffing and impact impressions" that were inflicted from different directions. Other photos purportedly show "[i]solated scuffing, dents, and tears to the front and mid-section of [the] left undercarriage parts" that were "man-made and inflicted from a vertical application of a force" caused by raising the vehicle at these locations using a floor jack or forklift. Shideh also included photographs purportedly showing a lack of damage to the front suspension and other areas that should have sustained damage if the car had run over an object that caused the other damage.
After receiving the report, Ramirez called Bagramyan and told him it appeared some of the damage to the car might not be related to the incident. Bagramyan became irate and said he would take GEICO to court. He insisted all the damage was caused by the incident and said he did not care what GEICO's expert thought. Bagramyan acknowledged he had not had the car inspected before he bought it, but he said it was a "beautiful vehicle" and was in great condition. Bagramyan said that, because he is in the auto body business, he would have known if there was something wrong with the car.
Based on Shideh's report, Bagramyan's interviews, and the other information GEICO had obtained, it disclaimed coverage for the claim. In support of its decision, GEICO cited a material misrepresentation provision in the policy, which states coverage "is not provided to any person who knowingly conceals or misrepresents any material fact or circumstance relating to this insurance . . . in connection with the presentation or settlement of a claim." In July 2018, GEICO informed Bagramyan's sister-in-law of its decision, noting it had determined Bagramyan had made a "misrepresentation on how the damage occurred."
About a month later, GEICO received a letter from an attorney, Emma Moralyan, who purported to represent Bagramyan. Moralyan demanded GEICO pay Bagramyan nearly $40,000 in damages, which included $30,741 for the total loss of the car, $460 for the cost of the tow truck, and $8,750 in storage fees. (Bagramyan had been storing the car at his auto shop.)
Moralyan attached to the letter a report from a "vehicle inspection firm" called Auto Doc's. According to the report, Auto Doc's inspected the car and found "sufficient evidence to determine that this vehicle was in forward motion traveling at freeway speed when an undisclosed solid object/s contacted the vehicle at the front center underside resulting in substantial damage to the vehicle undercarriage." Auto Doc's concluded "there is no evidence to support many of the GEICO claims and substantial evidence that refutes much of these claims." It attached to the report five photographs showing damage to the car. After reviewing the letter and report, GEICO decided to maintain its initial coverage decision.
In December 2018, GEICO learned that Bagramyan had filed a complaint with the California Department of Insurance. In order to respond to the complaint, GEICO asked Shideh to review Auto Doc's report and photographs.
About a month later, Shideh provided GEICO a supplemental report that maintained his original conclusions. The supplemental report criticized Auto Doc's for conducting an incomplete inspection and ignoring many of Shideh's opinions. Among other deficiencies, it noted Auto Doc's failed to address the damage to the mid and rear sections of the undercarriage, isolated vertical dents and penetrations to the left floor pan, tears to the undercarriage fibrous covers, cuts to the fuel line, and damages in crisscrossed formations. The Auto Doc's report also "failed to consider forensic analysis of predictable damages that could occur from an object entering through the front and exiting from the rear sections of undercarriage." After receiving the supplemental report, GEICO informed Bagramyan and the Department of Insurance that it was maintaining its original claims decision.
3. Bagramyan's action against GEICO
Bagramyan responded by filing a complaint against GEICO, asserting causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, and intentional interference with contractual relations. The complaint alleged GEICO failed to conduct a sufficient investigation and had hired a biased expert to generate a report it could use to deny coverage. In relief, it sought compensatory and punitive damages.
GEICO moved for summary adjudication of Bagramyan's bad faith cause of action and request for punitive damages. According to GEICO's motion, the undisputed evidence shows there was a "genuine dispute" regarding the validity of Bagramyan's claim, which precludes a finding of bad faith as a matter of law. GEICO argued there were several "red flags" with Bagramyan's claim that raised suspicion, including that he hired a tow truck driver he knew, he had the car towed to his own body shop, he failed to take any photographs of the car or the object he struck, the damage did not appear to have been caused by a single event, Bagramyan has a history of filing insurance claims, the car was the subject of two prior claims, and he failed to call the police. GEICO also pointed out that it denied the claim only after its expert concluded the damage was not consistent with Bagramyan's account. GEICO supported its motion with evidence showing the facts summarized above.
In opposition to GEICO's motion, Bagramyan argued a jury could conclude GEICO acted in bad faith because it (1) failed to evaluate all the evidence before denying the claim; (2) failed to establish he made any misrepresentations; and (3) unreasonably relied on Shideh's report, which was flawed and biased. Bagramyan identified 19 steps GEICO should have taken during its investigation, including contacting the California Highway Patrol, checking its own claim files for similar reported incidents from that night, inspecting the location of the reported incident to look for debris, speaking with the tow truck driver, and considering whether its decision to deny coverage was the result of a bias against Armenian Americans. Further, Bagramyan argued there was no proof that he knowingly made false statements; nor did anyone at GEICO make explicit findings as to that fact. Bagramyan also argued Shideh's report was biased and flawed because it did not directly answer the question GEICO posed to it: whether the damage could have occurred as Bagramyan said it did. Instead, Shideh concluded the damage did not happen the way Bagramyan claimed.
Bagramyan disputed only a single fact in GEICO's statement of undisputed material facts, which concerned GEICO's reasons for assigning the claim to its Special Investigations Unit. GEICO asserted that, after physically inspecting the car, it "had concerns that the damage to the Vehicle did not appear consistent with Bagramyan's reported facts of the Incident. Because of that, and the fact that Bagramyan was affiliated with the repair shop where the Vehicle was taken, GEICO decided to further investigate the claim in order to try to validate the facts of the loss." In disputing this fact, Bagramyan pointed to the "[Special Investigations Unit] Note" in GEICO's case file, which was entered before anyone had inspected the car.
Bagramyan also attached to his opposition a 32-page declaration from Bruce Warren. Warren is an attorney who, starting in the mid-1980s, spent about 20 years working at law firms representing insurance companies in bad faith claims litigation. More recently, Warren had represented several plaintiffs in bad faith cases against GEICO. Warren was "shocked" by how poorly GEICO had handled one of those claims, and he "felt it was as if GEICO was predisposed to declare every claim for hit-and-run damage to a parked car was fraudulent." As to this case, Warren concluded that, "based on my knowledge, experience and training, and on the information developed in the course of acting as counsel in those cases in which I represented or have represented insureds against GEICO, it is my expert opinion that GEICO's handling of plaintiff's claim here fell below industry standards to the point that its denial of plaintiff's claim was not only a breach of the implied covenant of good faith and fair dealing, but was also malicious."
4. The trial court's decision
The court granted GEICO's motion for summary adjudication. It found GEICO's "evidence demonstrates that it was not unreasonable in withholding benefits under the circumstances. This shifts the burden to Plaintiff to proffer sufficient evidence that there was no genuine dispute regarding the validity of his claim. Plaintiff fails to do so. None of Plaintiff's evidence demonstrates that [GEICO] withheld benefits in the absence of a genuine dispute. Nor does Plaintiff's evidence establish that [GEICO] acted with the requisite malice, fraud, or oppression to justify a claim for punitive damages."
GEICO objected to much of Bagramyan's evidence, including the Warren declaration. The trial court, however, did not rule on those objections.
At Bagramyan's request, the court dismissed his remaining claims and entered judgment for GEICO. Bagramyan timely appealed.
DISCUSSION
1. Standard of review
The rules governing summary adjudication are well established. "A defendant making [a] motion for summary adjudication has the initial burden of showing that the [challenged] cause of action lacks merit because one or more elements of the cause of action cannot be established or there is a complete defense to that cause of action." (Intrieri v. Superior Court (2004) 117 Cal.App.4th 72, 81-82; Code Civ. Proc., § 437c, subd. (f)(1).) If the defendant's "moving papers establish a prima facie showing that justifies a judgment in the defendant's favor, the burden then shifts to the plaintiff to make a prima facie showing of the existence of a triable material factual issue. In meeting this obligation, the plaintiff may not rely on the mere allegations of its pleadings, but must 'set forth the specific facts showing that a triable issue of material fact exists as to that cause of action ....' [Citation.] There is a triable issue of fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.'" (Intrieri, at p. 82; see Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849; Code Civ. Proc., § 437c, subd. (p)(2).)
In reviewing an order granting summary adjudication, "we apply the same standard of review applicable on appeal from a grant of summary judgment. [Citation.] Accordingly, '" . . . we take the facts from the record that was before the trial court when it ruled on that motion. [Citation.]' "We review the trial court's decision de novo, considering all the evidence set forth in the moving and opposing papers except that to which objections were made and sustained."' [Citation.] We liberally construe the evidence in support of the party opposing summary [adjudication] and resolve doubts concerning the evidence in favor of that party." '" (Schofield v. Superior Court (2010) 190 Cal.App.4th 154, 156-157, quoting Wilson v. 21st Century Ins. Co. (2007) 42 Cal.4th 713, 716-717 (Wilson).)
2. Relevant law
Implied in every insurance contract is an implied covenant of good faith and fair dealing that requires the insurer to refrain from injuring its insured's right to receive the benefits of the agreement. (Brehm v. 21st Century Ins. Co. (2008) 166 Cal.App.4th 1225, 1235.) "While an insurance company has no obligation under the implied covenant of good faith and fair dealing to pay every claim its insured makes, the insurer cannot deny the claim 'without fully investigating the grounds for its denial.' [Citation.] To protect its insured's contractual interest in security and peace of mind, 'it is essential that an insurer fully inquire into possible bases that might support the insured's claim' before denying it." (Wilson, supra, 42 Cal.4th at pp. 720721.)
The linchpin of a bad faith claim-i.e., a claim that an insurer violated the implied covenant of good faith and fair dealing-is that the denial of coverage was unreasonable. (McCoy v. Progressive West Ins. Co. (2009) 171 Cal.App.4th 785, 793 (McCoy).) A trier of fact may determine an insurer acted unreasonably if it denied a claim on a basis unsupported by the facts known to it or contradicted by those facts. (Wilson, supra, 42 Cal.4th at pp. 720-721.) A trier of fact also may find an insurer acted unreasonably if it ignores evidence supporting the insured's claim or conducts an inadequate investigation. (McCoy, at p. 793.)
On the other hand, because an insurer is entitled to give its own interests consideration, it acts reasonably if it denies a claim based on a "genuine dispute" with the insured over coverage. (Chateau Chamberay Homeowners Assn. v. Associated Internat. Ins. Co. (2001) 90 Cal.App.4th 335, 347 (Chateau Chamberay).) Therefore, "[w]here there is a genuine issue as to the insurer's liability under the policy for the claim asserted by the insured, there can be no bad faith liability imposed on the insurer for advancing its side of that dispute," even if its coverage decision ultimately was wrong. (Ibid.) An insurer's reliance on an expert opinion may show it acted reasonably, but it is not a guarantee. (McCoy, supra, 171 Cal.App.4th at p. 793.) An insurer that relies on an expert may still be found to have acted in bad faith if it dishonestly selected its expert, the expert acted unreasonably, or the insurer failed to conduct a thorough investigation. (Ibid.)
Whether an insurer acted in bad faith "is generally for the trier of fact to resolve, unless, 'from uncontroverted evidence, a reasonable man following the law can draw but one conclusion on the issue.' [Citation.]" (Hedayati v. Interinsurance Exchange of the Automobile Club (2021) 67 Cal.App.5th 833, 843.) The same is true of whether an insurer denied a claim based on a genuine dispute over coverage." '[A] court can conclude as a matter of law that an insurer's denial of a claim is not unreasonable, so long as there existed a genuine issue as to the insurer's liability.'" (Fraley v. Allstate Ins. Co. (2000) 81 Cal.App.4th 1282, 1292.)
3. GEICO met its initial burden
In support of its motion for summary adjudication, GEICO submitted overwhelming evidence that it denied Bagramyan's claim because it genuinely believed he had knowingly made material misrepresentations about the cause of the damage to his car. Because Bagramyan does not meaningfully dispute that GEICO met its initial burden, we discuss GEICO's evidence only briefly.
First, GEICO presented evidence of numerous "red flags" with Bagramyan's account of the incident, which led it to suspect his claim was fraudulent. For example, during his first interview -which took place two days after the alleged incident- Bagramyan struggled to recall what day the incident occurred. While far from a smoking gun, GEICO reasonably concluded this was unusual and warranted further investigation.
The same is true of Bagramyan's account of his actions immediately after the incident. Despite owning an auto body repair business-through which he presumably would have become familiar with auto insurance claims-Bagramyan did not take any pictures of his car or the object he purportedly struck. Nor did he call the police or file a timely police report. Moreover, although Bagramyan claimed he struck the object while on his way to his sister's house, he did not immediately tell her about the incident. According to Bagramyan, there was no need to call his sister because she did not know he was on his way to her house. Although certainly possible, GEICO reasonably considered this to be unusual given Bagramyan said the incident occurred relatively late at night.
Bagramyan's explanation for towing the car to his own auto body shop also strains credulity. According to Bagramyan, he decided to take the car to his shop because, at the time, he believed the damage was minor. Presumably, then, he thought he could repair the car himself. Bagramyan, however, also told GEICO the impact "felt very bad," and he "thought [he] was going to roll over" from it. After pulling to the side of the road, Bagramyan said he noticed a piece of the car was hanging, he smelled gasoline, and the car would not start. It is difficult to square these observations with Bagramyan's purported belief that the damage was minor.
GEICO was also reasonably suspicious of the circumstances under which Bagramyan claimed to have purchased the car. According to Bagramyan, he paid cash to a stranger who randomly walked into his shop and offered to sell him the car. Bagramyan said he bought the car for significantly less than its fair market value, even though it purportedly had a clean title, had not been in any accidents, and was free of major issues. GEICO's search, however, revealed the car had been vandalized, involved in a collision, and impounded twice before Bagramyan bought it. Bagramyan, moreover, admitted he did not inspect the car before he purchased it, calling into question his claim that the car was free of major issues.
Given the numerous red flags with Bagramyan's claim, GEICO retained an expert, Shideh, to determine whether the damage aligned with Bagramyan's account of the incident. After inspecting the car, Shideh provided GEICO a written report- supported by 61 annotated photographs of the car-in which he concluded the damage was "grossly inconsistent" with Bagramyan's claim that he drove over a metal object on the freeway. According to Shideh, the car suffered extensive damage, but the damage did not line up in such a way that it could have been caused by a single event. Shideh observed some of the damage was isolated, had been inflicted from multiple directions, appeared to have been man-made, and seemed to have been caused by a forklift or floor jack. Shideh also noted the lack of damage to certain areas of the car that he would have expected to have been damaged had the incident occurred in the manner Bagramyan reported. After reviewing the report and considering the other information it had obtained, GEICO determined Bagramyan had made knowing misrepresentations, and it decided to deny his claim.
Based on this evidence, any reasonable juror would conclude GEICO conducted a thorough investigation and reasonably denied Bagramyan's claim based on a genuine dispute over coverage. Accordingly, the trial court properly concluded GEICO met its initial burden to show it denied Bagramyan's claim based on a genuine dispute over coverage. The burden, therefore, shifted to Bagramyan to submit evidence creating a triable issue of fact, to which we now turn.
4. GEICO did not ignore evidence favorable to Bagramyan or conduct an inadequate investigation
Bagramyan argues the trial court should have denied GEICO's motion because he presented evidence from which a juror could conclude GEICO performed an inadequate investigation and ignored evidence favorable to him. According to Bagramyan, GEICO's investigation was lacking because it called the tow truck driver only once and failed to search for similar reports from other drivers in the area. Bagramyan also argues a jury could find GEICO unreasonably ignored the tow truck invoice and phone records, which were consistent with his account of the incident.
At the outset, the record does not support many of Bagramyan's assertions. Contrary to his claim that GEICO made only a single call to the tow operator, the undisputed evidence shows it called two different numbers listed on the tow invoice and left voicemails at each requesting a call back. Nor is there anything in the record even to suggest GEICO ignored the tow invoice and phone records. Rather, it appears it simply did not give the evidence the weight Bagramyan believes it deserves.
Regardless, Bagramyan's arguments fail for another, more fundamental reason: he has not identified any information GEICO might have obtained that would have refuted its reasons for denying the claim. The tow truck driver was not a witness to the incident itself. Nor does Bagramyan contend the driver thoroughly inspected the car or otherwise could have revealed the total extent of the damage it had suffered. At most, then, the driver could have confirmed that Bagramyan hired him to tow a damaged car. GEICO, however, did not deny the claim simply because it believed Bagramyan had lied either about having his car towed or the fact that it was damaged. Rather, it denied the claim because Shideh's inspection revealed the damage was "grossly inconsistent" with Bagramyan's report of the incident. The tow truck driver could not have provided GEICO any information relevant to that issue. Indeed, even if the driver had corroborated Bagramyan's account to the fullest extent possible, it would not have called into question Shideh's opinions or any other evidence GEICO relied on to reach its decision. The same is true of the invoice and phone records. Accordingly, on this record, no reasonable juror could conclude GEICO acted unreasonably by failing to follow up with the tow truck driver or give more weight to the invoice and phone records.
For the first time in his reply brief, Bagramyan suggests the tow truck driver might have revealed that some of the damage occurred while the car was in the driver's custody. Bagramyan forfeited this argument twice: first by failing to raise it in the trial court, and, again, by failing to raise it in his opening brief. (See Barker v. Brown &Williamson Tobacco Corp. (2001) 88 Cal.App.4th 42, 50 (Barker) [a party may not raise a new theory for the first time on appeal]; Christoff v. Union Pacific Railroad Co. (2005) 134 Cal.App.4th 118, 125 (Christoff) ["an appellant's failure to discuss an issue in its opening brief forfeits the issue on appeal"].) The argument also lacks merit. Beyond being pure speculation, Bagramyan has never claimed the car was in the driver's sole custody. GEICO, therefore, would have had no reason to suspect the driver might have revealed new information about the cause of the damage.
We are similarly unpersuaded by Bagramyan's contention that GEICO should have reviewed police reports and its own claim files to determine if other drivers encountered the same object on the road. Tellingly, Bagramyan does not contend that such an investigation would have yielded information in his favor. Nor does he point to any evidence that it is industry standard or practice to conduct such reviews under similar circumstances. Regardless, like Bagramyan's arguments related to the tow truck, it is not apparent additional investigation had the potential to yield information relevant to GEICO's decision. Indeed, even if other drivers had reported an object in the road that night, that fact would not change Shideh's conclusion that the damage to Bagramyan's car was "grossly inconsistent" with his account of the incident. On this record, no reasonable juror could conclude GEICO acted unreasonably by failing to search for reports of similar incidents.
Bagramyan's reliance on McCoy, supra, 171 Cal.App.4th 785 is misplaced. According to Bagramyan, McCoy shows "[t]his Court has upheld a jury verdict in favor of a vehicle owner where the insurer denied coverage based on fraud but failed to sufficiently investigate." The court in McCoy, however, did not designate for publication the portion of its opinion concerning the sufficiency of the evidence. Bagramyan, therefore, may not rely on the case to argue his evidence is sufficient to survive summary adjudication. (See Cal. Rules of Court, rule 8.1115(a).)
In the published portion of the opinion, the reviewing court held the trial court properly declined to give special jury instructions related to the genuine dispute doctrine. (McCoy, supra, 171 Cal.App.4th at pp. 792-794.)
Regardless, McCoy is readily distinguishable. In that case, the insurer denied the plaintiff's claim after his car was allegedly stolen in Las Vegas. The insurer's investigator suspected the plaintiff was involved in the theft because there were no obvious signs of trauma to the car's ignition, expensive tires were still on the car when it was recovered, and two witnesses reported the plaintiff had discussed "disposing of" the car. (McCoy, supra, 171 Cal.App.4th at p. 789.) The investigator, however, did not have specific proof that the plaintiff was involved in the theft, and a supervisor had noted the insurer could not rely on the witness statements alone to deny the claim. (Id. at pp. 789-791.) At trial, the plaintiff's expert testified that the insurer had not followed its own guidelines in handling the claim, the insurer had damaged the steering column in such a way as to prevent any subsequent investigations, and the plaintiff had no financial motive to commit fraud. (Id. at pp. 790-791.)
Here, Bagramyan submitted no evidence comparable to that presented to the jury in McCoy. He points to nothing in the record showing GEICO failed to comply with its own guidelines, destroyed evidence, or expressed internal concerns about the sufficiency of the evidence supporting its decision. Moreover, the insurer in McCoy denied the claim largely based on circumstances the investigator deemed to be suspicious. Here, too, GEICO cited suspicious circumstances, but it relied primarily on the opinion of a third-party expert. Accordingly, GEICO's basis for denying Bagramyan's claim is far less speculative than the insurer's basis for denying the claim in McCoy.
5. GEICO did not unreasonably rely on Shideh's report
Bagramyan argues he submitted sufficient evidence from which a jury could find GEICO unreasonably relied on Shideh's report to deny coverage. According to Bagramyan, GEICO failed to recognize three major flaws with the report: (1) the report does not address the core question GEICO posed to Shideh; (2) the report fails to address contrary evidence; and (3) Shideh was biased in favor of GEICO. We consider each in turn.
a. The report answers the question GEICO asked Shideh to consider
Shideh's report states GEICO tasked him with evaluating whether "there is any evidence to support the insured's claim of an accidental event that caused damages to the undercarriage components." Bagramyan insists the report does not directly answer that question; instead, it concludes only that some of the damage to the car could have been caused by another source. According to Bagramyan, the report thus leaves open the possibility that he told the truth about the incident but was unaware that the car had suffered additional damage from a different, unknown source. At the very least, Bagramyan suggests, GEICO should have addressed this ambiguity with Shideh before denying the claim.
Having reviewed the report, we do not think any reasonable juror would interpret it in the manner Bagramyan suggests. The report plainly states the damage to the car is "grossly inconsistent with the report of the incident." It goes on to state there is "no evidence of impact damages to the front exterior profiles, suspension, and undercarriage components from the [car] running over an object(s) on the road, as claimed by the insured." No reasonable person would interpret these statements as leaving open the possibility that Bagramyan provided an accurate report of the incident. GEICO, therefore, did not act unreasonably in failing to seek clarification from Shideh.
Bagramyan alternatively argues a jury could find Shideh lacked sufficient knowledge about Bagramyan's account of the incident to conclude it was inconsistent with the damage. We disagree. The report explicitly states Bagramyan "reported he struck a metal object while traveling on the 134 freeway." It also states Bagramyan claimed to have run over an object on the road. Both statements are consistent with Bagramyan's account of the incident.
Bagramyan argues Shideh failed to acknowledge the possibility that he ran over the object at such an angle that the object would not have caused damage across the entire length of the car. In support, he points to his comments that the impact" 'kind of pushed me to the right'" and" 'bumped me to the right.'" Bagramyan, however, did not raise this issue below or in his opening brief, which forfeits it on appeal. (See Barker, supra, 88 Cal.App.4th at p. 50; Christoff, supra, 134 Cal.App.4th at p. 125.) In any event, given Bagramyan repeatedly said he drove "over" the object, no reasonable juror would conclude GEICO should have disregarded Shideh's report for this reason.
Bagramyan further argues Shideh incorrectly assumed "every ding and dent on the undercarriage had to have been caused by a 'single event'" in order to line up with Bagramyan's account. It is not apparent, however, why such an assumption would be unfounded. Bagramyan, after all, insisted the incident caused all the damage to his car. He also claimed that, because he works in the auto repair industry, he would have known if something had been wrong with the car before the incident.
b. The report does not ignore contrary evidence
Bagramyan argues Shideh's report is flawed and reflects a lack of diligence because it fails to address contradictory evidence. Specifically, he contends the Auto Doc's report reveals Shideh missed or ignored four key areas of damage to the car that were consistent with his account of the incident: a tear to the rear lip of the front bumper, a severed front underside skid plate, a large impact compression dent on the subframe, and a large crater on the subframe.
The record does not support this claim. Although somewhat difficult to determine because of the poor quality of Auto Doc's photographs, it appears Shideh documented each of the four areas of damage that Auto Doc's identified in its report. Rather than ignore this damage, Shideh simply concluded it was not consistent with Bagramyan's account of the incident when viewed in the context of the totality of damage to the car. The Auto Doc's report failed to address that conclusion, which was the crux of Shideh's opinion.
Auto Doc's documented the four areas of damage in a series of photographs attached to its report. The quality of the photographs is poor, at least in the versions included in the appellate record. The photographs from Shideh's report, in contrast, are of significantly higher quality.
Bagramyan relatedly argues a jury could find GEICO should have reversed its claims decision after receiving the Auto Doc's report. Once again, we disagree. The Auto Doc's report did not reveal any new information relevant to the claim, nor did it directly address the crux of Shideh's report. In fact, there is no evidence that Auto Doc's ever reviewed Shideh's report. Instead, it appears to have relied on a letter GEICO sent to Bagramyan's sister-in-law, which merely quoted a few sentences from Shideh's report. From that excerpt, Auto Doc's apparently believed Shideh concluded there was "no evidence of impact damages to the front exterior profiles." Even a cursory review of Shideh's report reveals that is not what he concluded; indeed, Shideh attached to his report numerous photographs showing extensive damage to the front exterior profile. Rather, it is readily apparent Shideh concluded that, when considered in the context of all the damage to the car, the damage to the exterior profile could not have been caused in the manner Bagramyan claimed. The Auto Doc's report did not address that conclusion, let alone refute it. Under these circumstances, no reasonable juror could find GEICO acted unreasonably by declining to change its coverage decision after receiving the Auto Doc's report.
c. Bagramyan did not present sufficient evidence of bias
Relying on Hangarter v. Provident Life and Acc. Ins. Co. (9th Cir. 2004) 373 F.3d 998, Bagramyan contends a jury might find Shideh is biased because he is an established GEICO vendor whom GEICO had retained in the past. In Hangarter, a federal court concluded sufficient evidence supported a jury verdict finding an insurer denied the plaintiff's total disability claim in bad faith. The court explained that, in addition to significant other evidence of bad faith, the jury could have found the insurer exhibited bias in selecting and retaining its expert. The court noted the evidence showed the insurer had retained the same expert 19 times over the course of five years, the expert had found in favor of the insurer in every case involving a similar disability issue, and the insurer's retention letter noted its in-house consultant had already determined there were no objective findings for a disabling injury. (Id. at pp. 1008-1009, 1011.)
Bagramyan presented no comparable evidence in this case. Unlike the plaintiff in Hangarter, Bagramyan presented no evidence reflecting the number of times Shideh has given opinions favorable to GEICO in similar cases, nor did he present evidence that GEICO had somehow primed Shideh to produce a favorable report. At most, the record shows GEICO had retained Shideh in a handful of other cases, which Bagramyan acknowledges is alone not sufficient to raise an inference of bias. On this record, no reasonable juror could conclude GEICO dishonestly selected Shideh or otherwise acted unreasonably in retaining him as an expert. (See, e.g., Chateau Chamberay, supra, 90 Cal.App.4th at p. 348 [noting a bad faith claim should go to a jury when there is evidence "the insurer dishonestly selected its experts"].)
6. There are no triable issues related to "red flags"
Bagramyan argues none of the" 'red flags'" GEICO identified-such as his failure to call the police, relationship with the tow truck driver, difficulty recalling the date of the incident, and association with a higher-than-average number of prior incidents-constituted knowing misrepresentations or otherwise provided sufficient grounds for GEICO to deny his claim. He points out, for example, it was reasonable for him to call a tow truck driver he knew, he was not legally required to call the police, and the police frequently do not show up to the scene of relatively minor accidents. Bagramyan also asserts it is common to misremember dates, and he was forthcoming with GEICO about his history.
We agree with Bagramyan that these "red flags" alone did not provide a sufficient basis to deny coverage. GEICO, however, has never claimed it based its decision solely on the red flags. Instead, GEICO always has maintained it relied primarily on Shideh's conclusion that the damage to the car was inconsistent with Bagramyan's account of the incident. The red flags simply help to explain why it referred the case to Shideh in the first place. They also provide support for GEICO's conclusion that Bagramyan acted knowingly.
We similarly reject Bagramyan's alternative contention that GEICO's purported reliance on these red flags was pretextual. In support, Bagramyan points to evidence that GEICO's Special Investigations Unit conducted a "proactive review" of the claim before the red flags were even apparent. Contrary to Bagramyan's suggestions, however, the fact that the Special Investigations Unit was involved in the claim early on says very little. Indeed, for all we know, the Special Investigations Unit performs similar proactive reviews on every first-party claim. Absent evidence that this particular review was somehow unusual, Bagramyan's contentions are mere speculation and far from sufficient to meet his burden of proof.
7. GEICO had sufficient information to conclude Bagramyan's misrepresentations were knowing
Bagramyan argues that, even if GEICO reasonably concluded he made misrepresentations, it did not have sufficient evidence to conclude he made the misrepresentations knowingly. We disagree. GEICO presented undisputed evidence that, after it informed Bagramyan of Shideh's conclusions, Bagramyan continued to insist the incident had caused all the damage to his car. Bagramyan also maintained he would have known if there had been preexisting damage given his extensive experience working in auto repair. From this, GEICO reasonably could have determined Bagramyan's misrepresentations about the cause of the damage were knowing. In fact, on this record, it is the only reasonable interpretation.
8. The court properly granted summary adjudication with respect to Bagramyan's request for punitive damages
The parties seem to agree that Bagramyan's request for punitive damages is premised on the same allegations as his bad faith claim. For the reasons discussed above, we conclude the trial court properly granted summary adjudication in favor of GEICO on Bagramyan's bad faith claim. Accordingly, the court also properly granted summary adjudication in favor of GEICO with respect to Bagramyan's request for punitive damages.
Like the trial court, we do not find it necessary to rule on GEICO's evidentiary objections in order to decide this case. Accordingly, we do not consider them.
DISPOSITION
We affirm the judgment. GEICO is awarded its costs on appeal.
We concur: EDMON, P. J., HEIDEL, J. [*]
[*] Judge of the Los Angeles County Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.