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Prudential Insurance Co. of America v. Donlon

United States District Court, District of Alaska

May 7, 2015



H. Russel Holland United States District Judge

The issues raised in this case were tried to the court without a jury, commencing February 2, 2015. The court has since received written closing arguments from the parties.[1]Based upon the parties’ statement of uncontested facts, [2] the trial testimony, exhibits admitted at trial, and the parties’ closing arguments, the court now makes its findings of fact and conclusions of law.


This case commenced upon the filing of a complaint in interpleader by the Prudential Insurance Company of America (“Prudential”).[3] It is undisputed that Jason Donlon (“Jason”) was covered by a Servicemembers’ Group Life Insurance (“SGLI”) policy (G-32000), which Prudential issued pursuant to the Servicemembers’ Group Life Insurance Act (“SGLIA”), 38 U.S.C. §§ 1965-1980A. In its complaint, Prudential alleged that it was unable to determine factually or legally, who, as between defendants Lisa M. Donlon (“Lisa”) and Theresa D. Cook (“Theresa”), was entitled to 90% of the death benefits which Prudential was ready and willing to pay on account of the death of Jason Donlon. Theresa admitted all of the allegations of Prudential’s complaint and prayed for judgment establishing her right to the life insurance proceeds offered by Prudential.[4] Similarly, Lisa admitted the essential allegations of Prudential’s complaint. Lisa asserts an affirmative defense. Lisa contends that the death of Jason was “justified and not felonious.”[5] Lisa seeks a court order entitling her to the insurance proceeds offered by Prudential.

The case being at issue, the parties entered into a stipulation with Prudential that required Prudential to deposit with the registry of this court $360, 000.00 plus interest representing the insurance proceeds which were in dispute between Theresa and Lisa.[6] The funds in question were deposited with the court and, on June 27, 2011, Prudential was dismissed with prejudice and without costs from this case, [7] leaving Theresa and Lisa to litigate entitlement to the insurance proceeds.

As reflected by the parties’ June 2011 stipulation, [8] Lisa was under indictment as a result of the death of Jason. The parties agreed that if Lisa were convicted of Jason’s death, she would have thereby forfeited any right to the insurance proceeds in question; and if Lisa were to have forfeited the insurance proceeds, it was agreed that under the Prudential policy, death benefits would be payable to Theresa. Based upon a report from the parties, [9]proceedings in this court were stayed by order of July 21, 2011, [10] because of the underlying criminal litigation. By a series of orders, [11] this stay of proceedings was continued until March 29, 2013. By status report of April 3, 2013, [12] the parties reported that, as a consequence of trial in State v. Donlon, No. 3PA-10-34387-CR, Lisa was found not guilty in connection with the death of Jason.

A scheduling and planning order for the pretrial development of this case was entered May 30, 2013.[13] In due course, the pretrial development of the case was completed and motions were filed and determined by the court.[14] Thereafter, the court called upon the parties to certify the case ready for trial.[15] By order of August 7, 2014, [16] the case was set for trial beginning February 2, 2015. Concurrent with the trial setting, the court entered its Order for Pretrial Proceedings and Final Pretrial Conference.[17] The parties fully complied with that order. The parties filed a statement of uncontested facts, [18] which is incorporated into the court’s findings. The parties also filed a joint statement of issues, [19] their respective witness lists, [20] their respective exhibit lists, [21] and their respective trial briefs.[22]

Opening statements having been waived, Theresa’s Exhibits 1 through 24 were admitted by stipulation, and Theresa rested. Over four days, the court heard testimony from Lisa’s witnesses and rebuttal testimony on behalf of Theresa.[23]

Issues Presented

The parties’ joint statement of issues accurately captures the single issue presented by this case: did Lisa intentionally and wrongfully kill Jason? In their statement of issues, the parties agreed that Theresa has the burden of establishing, on a more likely than not basis, that Lisa intentionally and wrongfully killed Jason. In this regard, the parties have in substance agreed that Theresa must, by a preponderance of the evidence, negate the contention that Lisa acted in self-defense. Lisa contends that her actions were justified in reliance upon AS 11.81.335.

Applicable Law

“Because [a] SGLI policy ... is a federal contract issued pursuant to a federal statute, distribution of benefits under that policy is governed by federal law.” Dachtler v. Anderson, 772 F.Supp.2d 1301, 1305 (D. Nev. 2011) (citing Prudential Ins. Co. of Am. v. Athmer, 178 F.3d 473, 475 (7th Cir. 1999); Prudential Ins. Co. of Am. v. Neal, 768 F.Supp. 195, 197–98 (W.D. Tex. 1991)). Regulations promulgated pursuant to the SGLIA provide:

(e)(1) The proceeds payable because of the death of an individual insured under Servicemembers’ Group Life Insurance or Veterans’ Group Life Insurance (“decedent”) shall not be payable to any person described in paragraph (e)(2) of this section. A Servicemembers’ Group Life Insurance Traumatic Injury Protection benefit payable under § 9.20(j)(3) shall not be payable to any person described in paragraph (e)(2) of this section.
(2) The persons described in this paragraph are:
(i) A person who is convicted of intentionally and wrongfully killing the decedent or determined in a civil proceeding to have intentionally and wrongfully killed the decedent....

38 C.F.R. § 9.5(e).

Section 9.5(e)(2)(i) establishes two criteria which call into play different concepts: a mental state (“intentionally”) and a societal judgment (“wrongfully”). Here, as to the first component, we focus upon Lisa’s state of mind. There is no dispute that “intentionally” should be given its ordinary meaning of “on purpose.”[24] See United States. v. Gallegos, 613 F.3d 1211, 1214 (9th Cir. 2010) (quoting United States v. Iverson, 162 F.3d 1015, 1022 (9th Cir. 1998)) (when a regulation “‘does not define a term, we generally interpret that term by employing the ordinary, contemporary, and common meaning of the words’”). As to the second component, we consider society’s view of the nature of the homicide. The parties disagree as to whether “wrongfully” affords a slayer the opportunity to establish justification.

Based upon the rule-making history with respect to § 9.5, Theresa argues that it does not. The proposed regulation only included the term “intentionally” and did not include the term “wrongfully.” 77 Fed. Reg. 60304 (Oct. 3, 2012). Theresa argues that the term “wrongfully” was “added to reinforce the underlying public policy that one who intentionally kills another should not benefit from the act.”[25]

Theresa reads too much into the limited rule-making history upon which she relies. The term “wrongfully” was added to § 9.5(e) because it “speak[s] to the heinous aspect of the slayer’s act that violates public policy.” Id. But, it was also added to make § 9.5(e) consistent with 38 C.F.R. § 3.11. Id. Section 3.11 governs dependency and indemnity compensation for veterans’ survivors and “provides that ‘[a]ny person who has intentionally and wrongfully caused the death of another person is not entitled to pension, compensation, or dependency and indemnity compensation ... by reason of such death.’” Lofton v. West, 198 F.3d 846, 847-48 (Fed. Cir. 1999) (quoting 38 C.F.R. § 3.11). In Lofton, the surviving spouse, who had shot and killed her veteran husband, “argue[d] that the regulation [was] overbroad because it could prohibit the payment of benefits to a surviving spouse that mistook her husband for a burglar and mistakenly shot and killed him.” Id. at 851. The court rejected that argument, concluding that “[i]n such a case, the defense of mistake would undoubtedly be available to the surviving spouse, and the killing would therefore not be considered wrongful.” Id.; see also, Robinson v. Gibson, Case 12–3199, 2014 WL 2319254, at *3 (Vet. App. May 30, 2014) (holding that “[b]ecause ... the record of proceedings contains no evidence that Mrs. [Robinson]’s actions were the result of an accident, self-defense or that she was insane at the time of the killing, the Board’s factual finding of an intentional and wrongful killing is plausible and not clearly erroneous”). Because § 9.5(e) was modeled on Section 3.11, it follows that § 9.5(e), like Section 3.11, affords a slayer the opportunity to establish justification.

Lisa claims self-defense as a justification for killing Jason. Under federal common law, in order to prevail on a claim of self-defense, a defendant must show that “she acted with a reasonable amount of force in response to an imminent, perceived threat.” Metropolitan Life Ins. Co. v. Kelley, 890 F.Supp. 746, 749 (N.D. Ill. 1995); see also, In re Greene, 397 B.R. 688, 695 (Bankr. S.D.N.Y. 2008) (under federal common law, a claim of self-defense requires that the defendant show that she “was under an unlawful, imminent and impending threat of death or serious bodily injury”). “Because the law pertaining to self-defense is a matter ...

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