Opinion

1 2 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 BEVERLY BICA, Case No. 3:24-CV-1123-L-AHG 11 Plaintiff, ORDER MODIFYING REPORT 12 AND RECOMMENDATION AND 13 vs. SEALING ECF NO. 90 14 GENWORTH LIFE INSURANCE [ECF No. 63, 80] 15 COMPANY, 16 Defendant; 17 _____________________________________ 18 AND RELATED COUNTERCLAIM. 19 20 21 Pending before the Court is Plaintiff’s objection to Report and 22 Recommendation for Order Granting in Part and Denying in Part Defendant’s 23 Motion for Terminating Sanctions (“Report and Recommendation”). Defendant 24 filed a response and Plaintiff filed a reply. The Court decides the matter on the 25 papers submitted without oral argument. See Civ. L. R. 7.1(d)(1). For the reasons 26 which follow, the Report and Recommendation is modified. 27 Pursuant to 28 U.S.C. § 636(b)(1)(B), the Magistrate Judge recommends 28 granting in part Defendant’s motion for terminating sanctions. Specifically, the 1 Magistrate Judge recommends dismissing Plaintiff’s complaint with prejudice and 2 striking her answer to Defendant’s counterclaim as a sanction for failure over 3 approximately nine months to participate in discovery. Plaintiff objects to this 4 recommendation. 5 A district judge 6 shall make a de novo determination of those portions of the report or 7 specified proposed findings or recommendations to which objection is made. A judge of the court may accept, reject, or modify, in whole or 8 in part, the findings or recommendations made by the magistrate 9 judge. The judge may also receive further evidence or recommit the matter to the magistrate judge with instructions. 10 11 28 U.S.C. § 636(b)(1); see also Fed. R. Civ. Proc. 72(b)(3). In the absence of 12 objections, section 636(b)(1) does not require review by the district court under a 13 lesser standard. Thomas v. Arn, 474 U.S. 140, 149-50 (1985).1 The "statute makes 14 it clear that the district judge must review the magistrate judge's findings and 15 recommendations de novo if objection is made, but not otherwise." United States v. 16 Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003) (en banc) (emph. in orig.). 17 Plaintiff filed this action alleging breach of her long-term care insurance 18 policy. She claims that Defendant wrongfully terminated the policy while she was 19 hospitalized for serious injuries and unable to respond to Defendant’s request for 20 information. According to the complaint, Plaintiff suffers from severe cognitive 21 impairments. Defendant filed a counterclaim alleging that the policy is void due to 22 fraud. Plaintiff seeks policy reinstatement and damages for failure to provide 23 benefits, while Defendant seeks termination of the policy and restitution of benefits 24 it had already paid. 25 / / / / / 26 27 1 Unless otherwise noted, internal quotation marks, ellipses, brackets, citations, 28 and footnotes are omitted from citations. 1 It is undisputed that the issue of whether and/or to what extent Plaintiff is 2 cognitively impaired is at the heart of Plaintiff’s case and Defendant’s 3 counterclaim. To address this issue, Defendant noticed Plaintiff’s deposition and 4 independent medical examination (“IME”). After Plaintiff failed to appear initially 5 and after rescheduling for her deposition and IME, Defendant filed the pending 6 motion for terminating sanctions. 7 The Magistrate Judge recommends granting Defendant’s motion is part. Her 8 Report and Recommendation is thorough and well reasoned. Plaintiff does not 9 contend that the Magistrate Judge made any error of law or that she misapplied the 10 law to the facts as presented to her in briefing and at the hearing. However, based 11 on evidence which was not provided to the Magistrate Judge with Plaintiff’s 12 opposition to Defendant’s motion, Plaintiff contends that her failure to meet 13 discovery obligations was not willful and deliberate, thus precluding terminating 14 sanctions. See Connecticut General Life Insurance Co. v. New Images of Beverly 15 Hills, 482 F.3d 1091, 1096 (9th Cir. 2007). 16 In making this argument, Plaintiff relies on the neuropsychological 17 evaluation prepared by Eileen Kang, Ph.D., on September 13, 2024. (ECF No. 87- 18 1, Ex. A (“Medical Report.”) After testing and examination, Dr. Kang diagnosed 19 Plaintiff with a “Major Neurocognitive Disorder due to Traumatic Brain Injury,” 20 and noted “[s]ignificant memory and executive functioning impairments.” (Id. at 5- 21 6.) Dr. Kang opined that the examination results were “consistent with dementia” 22 and that Plaintiff “requires ongoing assistance to manage her daily tasks as well as 23 financial affairs.” (Id. at 6.) 24 Plaintiff also provided a declaration. (ECF Nos. 85 and 87-2 (corrections), 25 “Decl.”).) She explains that she did not receive some of the correspondence and 26 documents her counsel sent her by U.S. mail due to delivery problems over a three- 27 month period. (Decl. ¶¶ 6, 27.) In addition, her mobile phone and email account 28 1 communications from her counsel. (Id. ¶¶ 28-30.) These issues were resolved after 2 she had obtained help from an elder-help volunteer. (Id. ¶¶ 27, 29.) She also 3 explained that she was overwhelmed by the amount of legal paperwork she 4 received from her counsel and was unable to process it until she received help from 5 a friend. (Id. ¶¶ 6, 8, 11, 12, 18, 23.) Plaintiff asserts that, with the help she can 6 presently access and accommodations for her limited ability, she is available for 7 deposition and IME and can comply with the outstanding discovery order. (Id. ¶¶ 8 15-17, 23.) 9 In its response to Plaintiff’s objection, Defendant disputes Plaintiff’s 10 credibility based on the evidence discussed in the Report and Recommendation as 11 well as additional evidence submitted with its response. (ECF Nos. 89 and 89-1.) 12 The issue of whether Plaintiff’s noncompliance with discovery was willful 13 and deliberate and the merits issues raised in the pleadings all arise from the factual 14 dispute about Plaintiff’s cognitive impairment. Plaintiff has submitted sufficient 15 evidence which was not made available to the Magistrate Judge before issuing the 16 Report and Recommendation,2 to cast doubt on the factual finding that her failure to 17 comply was willful and deliberate. 18 Accordingly, in the interests of justice, the Report and Recommendation is 19 held in abeyance. No later than August 4, 2026, Plaintiff shall complete her IME. 20 In setting the August 4, 2026, deadline, the Court has taken into account Plaintiff’s 21 need for accommodations. (See Decl. ¶¶ 15-16.) 22 Plaintiff’s counsel have known of Plaintiff’s cognitive limitations since 23 undertaking the representation. (See Medical Report dated 9/13/2024.) Based on 24 Plaintiff’s limitations, it is not surprising that representing her has been difficult. 25 26 2 Although Plaintiff’s counsel acknowledge that not filing the Medical Report 27 with her opposition to Defendant’s motion for sanctions was a “failing,” their explanation that it was due to “the breakdown in attorney-client communication” is 28 wholly inadequate to justify it. (See ECF No. 90, “Reply” at 5.) 1 Nevertheless, counsel have a duty to communicate with their client, including 2 “explain a matter to the extent reasonably necessary to permit the client to make 3 informed decisions regarding the representation.” State Bar of California Rules of 4 Professional Conduct, Rule 1.4. As demonstrated by the nearly nine-month delay 5 in discovery proceedings, it is not sufficient to send legal paperwork to Plaintiff and 6 expect that she will take it from there. Plaintiff’s counsel acknowledge that “the 7 breakdown in communication was itself a product of Ms. Bica’s cognitive 8 condition[.]” (ECF No. 90, “Reply” at 4.) They must make arrangements for a 9 reliable means of communication with Plaintiff to prevent further breakdowns and 10 delays. They must also make an effort to explain matters to Plaintiff as necessary. 11 Finally, the Court notes that in her reply brief, Plaintiff included a lengthy 12 quote from her ENE statement. (Reply at 2.) As ENE statements are confidential 13 (see ECF No. 17, Notice and Order Setting Early Neutral Evaluation Conference 14 and Case Management Conference via Videoconference ¶ 3), the paragraph shall be 15 sealed, and Plaintiff shall file a redacted Reply. 16 For the foregoing reasons, it is ORDERED as follows: 17 1. The Report and Recommendation is modified insofar as it shall be held 18 in abeyance until August 7, 2026. 19 2. No later than August 4, 2026, Plaintiff shall complete her independent 20 medical examination. The parties shall cooperate to comply with the August 4, 21 2026, deadline including the accommodations Plaintiff requested in her 22 Declaration. 23 3. No later than August 6, 2026, the parties shall file a joint status report 24 regarding compliance with Paragraph 2 above. 25 4. Plaintiff’s counsel shall make all necessary arrangements for a reliable 26 means of communication with Plaintiff to prevent further delays in proceedings. 27 5. The clerk shall seal the document filed at ECF No. 90. 28 | 6. No later than June 26, 2026, Plaintiff shall file a redacted version of 2 || ECF No. 90, redacting lines 11 through 24 on page 2. 3 IT IS SO ORDERED. 5 || Dated: June 22, 2026 1 (ee fog? 7 H . James Lorenz United States District Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -6-