Florida Appellate Review

In the past few years, the strangest things have started appearing in appellate decisions: images. That has been seen as so revolutionary that it has been widely covered in the legal press, with 7th Circuit opinions authored by Judge Richard Posner (as is often the case) drawing the most attention. The question is: why are judges now inserting images into their opinions?

The answer may be that astute judges are responding to the changing environment in which their opinions are being read. Appellate court opinions have been accessible online for years, and they are now more commonly read on "screens" -- computers, iPads/tablets, and smartphones -- than in books. And studies have shown that we read differently when looking at a screen than when looking at printed text on paper.

For example, here's how scientists say our eyes track the data on a webpage:

Notice the concentration of red on the left hand border of the page created by the eye searching down the page for its structure. Note also how the eye tends to skip around.

Astute legal writers -- especially appellate lawyers -- would be wise to take note of how different the reading experience is on a screen, and to take it into account when drafting court submissions. That point was persuasively made during a presentation at the Florida Conference of District Court of Appeal Judges last fall (which I and other members of the Florida Bar's Appellate Practice Section were fortunate enough to attend).

Judges (and their clerks) are increasingly reading appellate briefs and other court submissions on computer screens, and when travelling, on iPads, Kindles and other e-readers, or on smartphones. (An informal survey during another presentation at the conference revealed Florida appellate judges to be tech-savvy and partial to iPhones and iPads, although Android phones were also represented).

The trend toward screen-reading will only increase now that e-filing is replacing paper filing.

In order for an appellate brief or any piece of legal writing to be persuasive, it must command the reader's attention. And to get and keep a reader's attention when he or she is reading on a screen, attorneys need to adopt the format of their documents to fit the environment.

How? In much the same way as one makes a webpage easy to read and engaging. Here are some suggestions:

• Add spacing -- Text is easier to read when it is surrounded by white space. Increase margins.  Large block paragraphs extending from margin to margin are a relic of book reading. They are difficult to digest when read on a screen, particularly when read on a Kindle or similar e-reader.
• Shorten the paragraphs. Not only do shorter paragraphs make the document more palatable to the eye (and increase white space), but they also account for the attention span issues that have been engendered by the digital age.
• Use headings more liberally. Effective headings are alot like soundbites -- they grab the reader's attention and drive home the point quickly before that attention is lost. Hopefully, they also encourage the reader to continue to read and pay attention.
• Insert document bookmarks. If you've opened a .pdf of a recent Florida Supreme Court opinion, you may have noticed a menu bar on the left hand side mapping out the sections of the opinion. Document bookmarks help the reader to get a feel for the overall structure of the document. They also help the reader to easily navigate between sections and arguments. When the reader must scroll up and down the screen to find sections, a traditional table of contents is a much less helpful roadmap than a bookmarks bar, where the reader can click right on the section he or she is looking for.

And finally there's the most radical idea: illustration with images. This practice is the most obvious concession to the effect the internet and it remains relatively unorthodox and somewhat controversial. So a fair amount of tact and judgment is needed.

But when used appropriately, tactfully, and sparingly, images can be highly effective. (If the picture is worth 1000 words, it can also help to make the brief shorter, which judges always appreciate). If nothing else, images command attention. Just ask Judge Posner. 

It looks like I spoke too soon. Not long after I wrote that the 3rd DCA would not be offering its view on when auto insurers may take advantage of the 2008 amendments to Florida's No Fault Law to limit personal injury protection reimbursements, declining to answer certified questions in  U.S. Security Insurance Company v. Professional Medical Group, Inc., the court decided to address the issue confronted by the 4th DCA in Kingsway Amigo after all. In Geico Indemnity Company v. Virtual Imaging Services, Inc. (released on November 30, 2011), the 3rd DCA answered a question certified as a matter of great public importance similar to the question in Kingsway Amigo (covered here):

May an insurer limit provider reimbursement to 80% of the schedule of maximum charges described in F.S. 627.736(5)(a) if its policy does not make a specific election to do so? 

Over Judge Rothenberg's vigorous 20 page dissent, Judge Cortinas, writing for the court majority consisting of himself and an associate judge, said no, agreeing with the 4th DCA that an auto insurer cannot limit reimbursements to 80% of 200% of the amount provided in Medicare Part B fee schedules unless the insurance policy states explicitly that this reimbursement methodology may be used.

The majority relied in part on Kingsway Amigo and the primary case that decision relied on, State Farm Insurance Co. v. Nichols, 21 So. 3d 904 (Fla. 5th DCA 2009), but diverged a bit from their reasoning. The primary thrust of the analysis in Geico deals with whether using the Medicare Part B-based reimbursement limits under section 627.736(5)(a)(2)(f) is an alternative to reimbursing for "reasonable" expenses per section 627.736(a)(1), or is merely a statutorily defined method of fixing what "reasonable" expenses are.

That question mattered because Geico's policies stated that it would pay, "in accordance with and subject to the terms, conditions, and exclusions of the Florida Motor Vehicle No-Fault Law, as amended...80% of medical expenses," with "medical expenses" defined as "reasonable expenses." So if 80% of 200% of Medicare Part B = reasonable expenses, then the policies could be characterized as stating that this reimbursement formula might be used. Judge Rothenberg agreed with Geico that this was the proper way to understand the statute and the policies, and as such, the policies could not reasonably be read to affirmatively elect to reimburse based on reasonableness rather than taking advantage of the Medicare Part B methodology.

The majority, however, understood section 627.736(5)(a)(2)(f) to offer an alternative option for calculating reimbursements:

Geico was faced with at least two ways of reimbursing reasonable medical expenses: (a) reimbursing Virtual Imaging for 80% of the amount billed, or (b) reimbursing them for 80% of 200% of the amount listed on the Medicare fee schedule.

At the very least, according the majority, the statute is ambiguous on this point. If it is ambiguous, then the policies, which incorporate the statute by reference, are also ambiguous. And when an insurance policy provision is ambiguous, i.e., susceptible to two reasonable interpretations, Florida law requires courts to adopt the interpretation that favors coverage. Thus, the majority concluded that the policies had to be understood as not allowing Geico to limit reimbursements based on Medicare Part B rates.

Judge Rothenberg disagreed, explaining that prior to the 2008 amendments, insurers could anyway have reimbursed based on Medicare Part B if they stated in their policies that they would use that methodology. In her view, the point of the 2008 amendments was to avoid litigation over what reimbursement amounts were "reasonable," by giving insurers "safe harbor" amounts (80% of 200% of Medicare Part B amounts) that the statute deems to be per se reasonable. As such, there aren't alternative options for reimbursing providers under PIP; there's only one: paying "reasonable" rates. Using the Medicare schedules is simply a safe harbor for determining what "reasonable" means.

The Bottom Line

The result in Geico obviously reinforces the 4th DCA's decision in Kingsway Amigo, and avoids the inter-district conflict that insurers might have hoped would lead the Florida Supreme Court to take up these issues in Kingsway Amigo (or Geico). Given that the issue has been certified as an issue of great public importance by at least two trial courts, Geico's best hope might be in trying to convince the 3rd DCA to do the same, which would seem its best available route to the Supreme Court.

The 3rd DCA's decision may also may make it more difficult to convince other DCAs to reach a different result from the 4th DCA if and when they confront the issue addressed in Kingsway Amigo. On the other hand, ithe fact that a District Judge has now issued a long, reasoned explanation (albeit in dissent) for why the opposite result should be reached might give other District Judges reason for pause.

But pending further developments, Kingsway Amigo and Geico are effectively the law of the land throughout Florida, so section 627.736(5)(a)(2)(f) cannot be used to limit reimbursements unless the insured's policy states that those limits will be used. And insurers that want to take advantage of the statutory maximums going forward should ensure that their policies unambiguously disclose the intent to do so.

The Florida Supreme Court returned from its summer hiatus last week with its first regular release of opinions since July 8, and sent this message: when the grandkids come to visit, don’t let them drive your car! 

Among the new opinions released on Thursday, August 25, 2011 was State Farm Mutual Automobile Insurance Co. v. Menendez, which resolved a split between the 3rd and 4th DCAs on the application of so-called “Household Exclusion” clauses in auto insurance policies when an accident occurs while an insured vehicle is being driven by someone who does not live with the policyholder, and a passenger who lives with the driver (but not the policyholder) is injured.

In Menendez, Grandma was the named insured under a State Farm policy and the vehicle’s owner. Granddaughter and her Mom and Dad (who lived with her, not with Grandma) went for a ride in Grandma’s car. Grandma let Granddaughter drive. Granddaughter got into an accident. Everyone was injured.

The question was: Was State Farm on the hook to indemnify their injuries? Under the Household Exclusion in the policy, State Farm was off the hook for coverage of injuries suffered by “any insured or any member of an insured’s family residing in the insured’s household.” The effect of the household exclusion is straightforward in the common scenario, where a named insured (Grandma) is driving, and a family member who lives with her (e.g., Grandpa) is injured. The Household Exclusion operates to exclude coverage for Grandpa's injuries.

But the situation in Menendez was trickier, because Grandma’s policy also indemnified her for accidents that might occur while her car was being driven by someone who borrowed it. And to that end, the policy defined the term “insured” as including “any other person while using such a car” with the named insured’s consent.

The good news for Grandma is that when Granddaughter was driving Grandma’s car, she was considered to be an “insured” under the policy, so State Farm, not Grandma, would be on the hook for claims by injured third parties. The bad news for Grandma is that since Granddaughter is an “insured,” her injuries aren’t covered under Grandma’s policy.

The question was whether the Household Exclusion also precludes coverage of injuries to family members who don't live with the named insured but do live the authorized borrower of the car who is deemed to be an "insured" under the policy.  In other words, were the injuries suffered by Granddaughter’s Mom and Dad, who lived with her, but not Grandma, excluded from coverage by the Household Exclusion? 

The Supreme Court unanimously held that they were.  Like most appellate decisions in insurance coverage disputes, the discussion began and ended with interpreting a single phrase, in this case the Household Exclusion's wording that it excluded injuries to "“any member of an insured’s family residing in the insured’s household.” 

The court had little trouble concluding that this phrase "unambiguously excludes coverage for any bodily injury claims asserted by members of a permissive-driver insured‟s family residing in the household of the permissive-driver insured."  That conclusion followed naturally from the policy's definition of the term "insured" as including permissive drivers such as Granddaughter as well as the named insureds.  "Named insured" was a separately defined term under the policy, so the clause would have used that term if only the members of the named insured's household were to be excluded.   

Although Grandma’s side (as well as the trial court and the 3rd DCA) thought it significant that the phrase referred to family members of "an insured" but used the term “the insured” when referring to who those family members must live with to be excluded, the Supreme Court found that distinction unimportant.  The policy used the phraseology of "an insured" and "the insured" interchangeably, it said, so there was no reason to think that using "the insured" in this phrase signified that only members of the named insured's household were excluded. 

Given this unanimity and what seems like a pretty straightforward construction of the policy terms, you might ask why the 3rd DCA (and trial court) didn't reach the same result.  My hunch -- and it's only a hunch -- is that it may have had something to do with the commonly understood notion of what household exclusions are supposed to do.  

That is to say those exclusions have historically been understood to be directed at excluding claims by immediate family members against the policy owner (e.g., my daughter sues me for injuries she suffered in an accident we got into while I drove her to school), which due to both parties being part of the same economic unit, is a lot like suing yourself and carries the potential for fraudulent and/or collusive claims. 

But suppose I lend you my car, which I know has faulty brakes.  When the brakes inevitably fail, you get into an accident.  After taking your daughter home from the hospital, you sue me for negligently causing the injuries your daughter suffered in the accident.  Now it seems a lot less intuitive that your claims should be excluded from coverage.  In that scenario, the fraud/collusion rationale doesn't apply, and it makes a lot less sense to exclude coverage of your daughter's injuries simply because she lives with you.  There's also the anomaly that resulted in Menendez case that if Grandma had driven rather than riding shotgun, Mom and Dad's injuries would have been covered, because Granddaughter wouldn't have been an "insured," and they didn't live with Grandma.     

It's hard to know whether those types of considerations played any role in the courts below, but they obviously didn't sway any of the Supreme Court justices. Instead, Menendez joins a long list of decisions showing that when it comes to interpreting insurance policies, about the only thing the Court cares about is the literal meaning of the words and phrases used in the policy. Whether or not that may lead to counterintuitive results.

But if Grandma had simply driven instead of letting Granddaughter do it, everyone's injuries would have been covered, except of course for Grandma's injuries.  So the other lesson here for grandparents is not to let your grandchildren drive when they come to visit.  Or make sure they don't get into accidents.

Real electronic filing may finally make its way to Florida courts in the not-too-distant future.  But before that happens, the Florida Supreme Court wants to make sure that there isn't too much private information in court filings for the public to access.

On June 30, 2011, the Court adopted sweeping new rules about what information can and can't be put in the court file.  Florida litigators who want to avoid the sanctions that can be imposed for violating the new rules shouldn't wait too long to become familiar with them -- they are going into effect on October 1, 2011.

For the time being, the privacy rules don't affect criminal cases, for the most part, but they affect all civil cases.  And the reprieve in criminal cases isn't likely to last very long.

Here is a breakdown of the Rule changes you need to know:

Florida Rule of Judicial Administration 2.425

Rule of Judicial Administration 2.425, which was added by the Court’s June 30, 2011 Amendments, contains the overarching principles. So if you learn that Rule (and remember to apply it in whatever context you find yourself) you'll be most of the way there. But one caution: Rule 2.425 only states a default rule -- it gives way to conflicting Rules, statutes, and orders.

This chart spells out the types of information that are subject to Rule 2.425:

Restricted Info:     Can include in a filing?           Exceptions:

General Exceptions:

• Statute, Rule or Order authorizes the inclusion of the information in a filing
• Account number is necessary to identify property at issue in a case.
• Information that is "relevant and material to an issue before the court." [!!! This looks to me like an exception that you could drive a truck through.  It'll be interesting to see how courts interpret it.]
• Records in an administrative, agency, appellate, or review proceeding.
• Information used by the clerk or the court for file and case management purposes.
• Criminal cases are temporarily exempt.
• Traffic court cases are temporarily exempt.
• Small claims cases are temporarily exempt.

A Few Other Notes:

What effect does Rule 2.425 have on parties' ability to obtain a protective order?  According to the Rule itself, none.  But I'd be surprised if judges' opinions on what information should be kept private were not influenced by the views of the Supreme Court as expressed in Rule 2.425.

The Rule also claims that it "does not affect the application of constitutional provisions, statutes, or rules of court regarding confidential information or access to public information."  I'm not sure how that could be so, but again, we'll see how courts interpret that subsection.

The Court is also amending quite a few other Rules to accomodate Rule 2.425.  Changes are being made to the Rules of Civil Procedure, particularly with regard to filing discovery documents, the Family Law Rules of Procedure, the Rules of Appellate Procedure, Probate Rules, and to a lesser extent, Criminal Procedure and Small Claims Rules, as well as several forms.

The amendments to those rules and forms are listed below. 

Continue Reading

Building on its May 4, 2011 decision in MRI Associates of America, LLC v. State Farm Fire & Casualty Company, No. 4D10-2807, which I covered in this recent post, Florida’s Fourth District Court of Appeal issued a second major PIP decision on May 18, 2011, Kingsway Amigo Insurance Company v. Ocean Health, Inc., No. 4D10-4887.

As noted in my entry on that case, in MRI, the court interpreted medical providers’ obligations when submitting claims for reimbursement under PIP, holding that their claim forms must state not the amount they usually charge for the treatment at issue, but the exact amount the insurer’s policy requires it to pay.

In Kingsway, the 4th DCA dealt with the other side of the coin:  insurers' payment obligations.  The decision addresses when a PIP insurer can take advantage of Florida Statutes Section 627.736(5)(a)2, which was added in the 2007 amendments to the PIP statute. Subsection (5)(a)2 allows PIP insurers to “limit reimbursement to 80 percent of” the amount Medicare Part B will pay for the treatment, of if not covered by Medicare Part B, the reimbursable amount for the treatment under workers’ compensation.

The crux of the 4th DCA's holding was that an insurer cannot limit its reimbursement amounts as provided by the 2007 amendments unless the language of the patient’s auto insurance policy explicitly states that the insurer will do so. If not, the insurer must continue to reimburse medical providers for treatments at “reasonable” rates as defined under Subsection (5)(a)1.

The result was that Kingsway, the insurer, had to reimburse Ocean Health, the provider based on “reasonable” rates, not Medicare Part B rates. The court reasoned that because Kingway’s policy said only that it would reimburse at reasonable rates, the insurer, in effect, had promised to provide benefits at a higher level than the minimum required by statute.

Importing the 5th DCA’s reasoning in State Farm Florida Insurance Co. v. Nichols, 21 So.3d 904 (Fla. 5th DCA 2009), which involved homeowner’s policies, the 4th DCA held that when an insurance statute allows insurers to choose alternative methodologies for reimbursement, an insurer can only take advantage of the methodologies its policy allows.

Who Won?

On the surface, PIP medical providers might see Kingsway as a welcome decision in their favor after the unfavorable result in MRI. But on closer inspection, it's less clear that the decision benefits providers.

In the last paragraph of the decision, the court draws on the holding in MRI as support for its conclusion in Kingsway. If providers must submit claims for the exact amount the insurer is required to pay them (per the holding in MRI) the 4th DCA reasoned, then they must be able to look at their patients’ insurance policies and determine the methodology the insurer will use to pay them.

So Kingsway reinforces that medical providers will now have to consult each of their PIP patients’ policies in order to submit a claim for each treatment. MRI left open the possibility that a provider could avoid that burden by submitting all PIP claims at Medicare Part B rates (or where not covered by Medicare Part B, at workers’ compensation rates). But Kingsway appears to put the kibosh on that idea.

From the perspective of Kingsway and other PIP insurers, the immediate result is, of course, a loss.  PIP insurers will have to reimburse some medical providers based on “reasonable” rates, which, presumably, will generally be higher than Medicare Part B and/or workers’ compensation reimbursement rates they'd prefer to use.

But I expect that the impact of this decision will be short-lived. Any Florida Auto Insurer that has not yet changed its policy forms to explicitly incorporate the power to limit reimbursement based on the 2007 amendments is now on notice to do so.  I’m sure they will make those changes in short order.

So it won’t be long until all medical providers can safely assume that all PIP insurers will pay them based on Medicare Part B and/or workers' compensation rates, and return to submitting claims without consulting the payment terms of their patients’ PIP policies.  And all PIP insurers will be able to rest assured in reimbursing providers at those lower rates.