Metropolitan Life Insurance Company v. Liebowitz

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

FORT MYERS DIVISION

METROPOLITAN LIFE INSURANCE

COMPANY,

Plaintiff,

v. Case No: 2:20-cv-276-JES-MRM

FRED A. LIEBOWITZ,

Defendant.

OPINION AND ORDER

This case comes before the Court on the parties’ cross motions

for summary judgment (Docs. ## 78, 80) filed on July 21, 2021.

Each party filed Responses in opposition (Docs. ## 89, 90), and

Replies. (Docs. ## 91, 93.) As discussed below, the motions

concern only issues relating to whether coverage exists under a

certain insurance policy. For the reasons set forth, defendant’s

motion for summary judgment is DENIED and plaintiff’s motion for

summary judgment is GRANTED IN PART AND DENIED IN PART.

I.

1

The record establishes the following undisputed facts.

1

“Both parties contend that the facts are essentially

undisputed.” (Doc. #97, p. 11.) The Court, therefore, generally

cites to the “Statement of Undisputed Issues of Fact” portion of

the Joint Pretrial Statement (Doc. #97, pp. 6-11), supplemented as

needed by compiled statements of the parties (Docs. #78, 80) and

exhibits in the record. MetLife’s embedded motion to strike (Doc.

A. DOH Complaints and Investigations

Dr. Fred A. Liebowitz (plaintiff or Dr. Liebowitz) is a pain

management physician in the Fort Myers, Florida area. (Doc. #97,

¶ 9(1)). At all relevant times, his primary source of income was

treating patients for pain and prescribing narcotics. (Id. ¶

9(3).)

By a letter dated May 10, 2010, Dr. Liebowitz was notified

that the Florida Department of Health (DOH) was conducting an

investigation of a complaint filed against him. (Id. ¶ 9(10).)

Ultimately, in 2010 and 2011 the DOH filed and served Dr. Liebowitz

with three separate Administrative Complaints (the “DOH

Complaints”) in connection with medical care he had provided. (Id.

¶ 9(11).) The DOH Complaints alleged that on many occasions Dr.

Liebowitz improperly prescribed pain killers to patients,

including one incident where a patient subsequently died from drug

overdose. (Doc. #80, ¶ 11.) The DOH Complaints requested that

the Board of Medicine impose penalties on Dr. Liebowitz, including

revocation or suspension of his medical license, restrictions on

his medical practice, fines, reprimands, probation, corrective

action, and remedial education. (Id. ¶ 12.) When Dr. Liebowitz

#90, p. 1, fn.1.) is denied, and the Court declines MetLife’s

request to deem the motion “largely unopposed.” (Doc. #93, p. 2.)

was served with the DOH Complaints he signed a form disputing the

facts and requesting a formal hearing. (Doc. #78, ¶ 7.)

Dr. Liebowitz notified his malpractice insurance carrier of

the DOH Complaints and was represented by William Whitney (Mr.

Whitney), an attorney provided by this insurance carrier,

throughout the DOH administrative process. (Doc. #97, ¶ 12.) Mr.

Whitney kept Dr. Liebowitz apprised of significant developments in

the DOH proceedings. (Doc. #80, ¶¶ 14-16; Doc. #97, ¶ 13.) Dr.

Liebowitz was an active participant with counsel and stayed current

on matters related to the DOH Complaints because the proceedings

were important to his medical practice and reputation. (Doc. #80,

¶¶ 15-16, 20.)

In July 2014, the DOH provided Dr. Liebowitz with a proposed

settlement offer which Dr. Liebowitz and Mr. Whitney discussed in

detail. (Id. ¶¶ 21-22.) Around September 2014, Dr. Liebowitz

hired a second attorney (Allan Grossman) with his own funds to

provide a second review of his case and to evaluate the settlement

offer. (Id. ¶¶ 25-28.) The proposed settlement agreement included

permanent restrictions that would indefinitely prevent Dr.

Liebowitz from practicing his specialty of pain management and

prescribing narcotics. (Id. ¶ 23.) The DOH offer was not accepted

by Dr. Liebowitz.

B. Insurance Application and Policy Issuance

On or about January 30, 2015, Dr. Liebowitz completed an

application for a disability insurance policy with Metropolitan

Life Insurance Company (defendant or MetLife) (the “Application”).

(Doc. #97, ¶ 9(1).) Dr. Liebowitz answered certain questions in

the Application “to the best of [his] knowledge and belief,”

including the following two questions and answers pertinent to the

current litigation:

Question 5(i): Are you aware of any fact that

could change your occupational status or

financial stability? If YES, please give

details below.

Answer: No [box checked].

***

Question 17: Have you EVER had a professional

license suspended, revoked, or is such license

under review or have you ever been disbarred?

If YES, give details below.

Answer: No [box checked].

(Id. ¶ 9(5).) Dr. Liebowitz admits he did not disclose the pending

DOH Complaints and investigations in the Application. (Doc. #89,

p. 2.) MetLife made no investigation to determine the accuracy of

the statements, but relied solely on the answers. (Doc. #97, ¶

9(8).) MetLife subsequently approved Dr. Liebowitz for coverage

based on the answers in his Application. (Doc. #80, ¶ 4.)

MetLife processed Dr. Liebowitz’s Application and issued a

disability policy (the Policy) between April 16, 2015 and May 3,

2015. (Doc. #97, ¶ 9(4).) On May 3, 2015, the Policy was delivered

to Dr. Liebowitz, who signed an Amendment to the Application which

affirmed that “there [were] no facts or circumstances which would

require a change in the answers in the application.” (Id. ¶ 9(7).)

The Policy had an effective date of March 6, 2015. (Id. ¶ 9(4).)

C. Resolution of the DOH Complaints

In 2018, the DOH amended the DOH Complaints, reducing the

scope of the allegations. (Doc. #80, ¶ 32.) On September 11,

2018, Dr. Liebowitz entered into a settlement agreement with the

DOH. (Doc. #97, ¶ 9(15).) A Final Order approving the settlement

was entered by the Board of Medicine on December 18, 2018. (Id.)

Among other things, the Final Order issued a Reprimand against Dr.

Liebowitz’s medical license and restricted his ability to

prescribe any controlled substance. (Doc. #80, ¶ 39.)

D. Dr. Liebowitz’s Insurance Claim and MetLife Rescission

Also on December 18, 2018, Dr. Liebowitz submitted initial

claims forms to MetLife for disability benefits, stating his work

had been limited since January 4, 2016 due to an ankle injury.

2

(Doc. #80, ¶ 43 (citing Doc. #72-2, pp. 202-03).) MetLife spent

about a year investigating Dr. Liebowitz’s disability benefits

2

Dr. Liebowitz more recently asserts that his disability

commenced in July 2017 (Doc. #78, pp. 9, 16), and “disavows he was

disabled within 2 years of the policy’s issue or effective date.”

(Id. p. 15.) Whether Dr. Liebowitz’s disability commenced in

January 2016 or July 2017 is immaterial to the coverage issue.

claim, which included review of his Application. (Id. ¶¶ 44, 52.)

Following its investigation, MetLife sent Dr. Liebowitz, through

counsel, a Notice of Rescission dated December 30, 2019. (Doc.

#97, ¶ 9(21).) The Notice set forth the alleged material

misrepresentations made in his Application which were the basis

for rescission, and included a check representing premiums paid by

Dr. Liebowitz to date and interest. (Id.) Dr. Liebowitz disputed

MetLife’s rescission and did not cash the check. (Id. ¶ 21-22.)

E. Present Litigation

On April 15, 2020, MetLife filed a Complaint seeking a Court

order “rescinding the Policy, and declaring that Liebowitz has no

right, title, or interest in the Policy.” (Doc. #1, Prayer for

Relief.) Dr. Liebowitz, in turn, filed two interconnected

counterclaims against MetLife seeking reinstatement of the Policy

and disability benefits under the Policy. (Doc. #58.)

With the approval of the Court (Docs. ## 43-44), discovery

and trial have been bifurcated into two phases. The first phase

will determine the “coverage” issue, with a bench trial if

necessary. (Doc. #44.) If there is coverage, a second phase will

determine what benefits are due to Dr. Liebowitz, i.e., the

“damages” issue, with a jury trial if necessary. (Id.) The cross-

motions for summary judgment at issue in this Opinion and Order

concern the coverage issue, only. (Docs. ## 78, 80.)

II.

Motions for summary judgment should only be granted when the

pleadings, depositions, answers to interrogatories, and admissions

on file, together with the affidavits, show “there is no genuine

issue as to any material fact and that the moving party is entitled

to judgment as a matter of law.” Fed. R. Civ. P. 56(c); Celotex

Corp. v. Catrett, 477 U.S. 317, 322 (1986). “An issue of fact is

‘genuine’ if the record taken as a whole could lead a rational

trier of fact to find for the nonmoving party.” Baby Buddies,

Inc. v. Toys “R” Us, Inc., 611 F.3d 1308, 1314 (11th Cir. 2010).

A fact is “material” if it may affect the outcome of the suit under

governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248

(1986). “A court must decide ‘whether the evidence presents a

sufficient disagreement to require submission to a jury or whether

it is so one-sided that one party must prevail as a matter of

law.’” Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256,

1260 (11th Cir. 2004) (quoting Anderson, 477 U.S. at 251).

In ruling on a motion for summary judgment, the Court views

all evidence and draws all reasonable inferences in favor of the

non-moving party. Scott v. Harris, 550 U.S. 372, 380 (2007); Tana

v. Dantanna’s, 611 F.3d 767, 772 (11th Cir. 2010). However, “if

reasonable minds might differ on the inferences arising from

undisputed facts, then the court should deny summary judgment.”

St. Charles Foods, Inc. v. America’s Favorite Chicken Co., 198

F.3d 815, 819 (11th Cir. 1999) (quoting Warrior Tombigbee Transp.

Co. v. M/V Nan Fung, 695 F.2d 1294, 1296-97 (11th Cir. 1983))

(finding summary judgment “may be inappropriate even where the

parties agree on the basic facts, but disagree about the factual

inferences that should be drawn from these facts.”)).

Cross motions for summary judgment do not change the standard.

See Am. Bankers Ins. Grp. v. United States, 408 F.3d 1328, 1331

(11th Cir. 2005). Cross motions for summary judgment are to be

treated separately; the denial of one does not require the grant

of another; and summary judgment is inappropriate if disputes

remain as to material facts. Id.; United States v. Oakley, 744

F.2d 1553, 1555 (11th Cir. 1984). The treatment of cross motions

remains the same even when a case is set for a bench trial, except

in limited circumstances where the parties, in effect, submit an

agreed-upon statement of facts for a trial based on the written

record. Fla. Int’l Univ. Bd. of Trustees v. Fla. Nat’l Univ.,

Inc., 830 F.3d 1242, 1253 (11th Cir. 2016) (quotation omitted).

III.

Florida law allows an insurance policy to be rescinded under

certain circumstances. MetLife must adequately plead and

ultimately prove six elements to establish a cause of action for

rescission of its insurance contract:

(1) [t]he character or relationship of the

parties; (2) [t]he making of the contract; (3)

[t]he existence of fraud, mutual mistake,

false representations, impossibility of

performance, or other ground for rescission or

cancellation; (4) [t]hat the party seeking

rescission has rescinded the contract and

notified the other party to the contract of

such rescission; (5) [i]f the moving party has

received benefits from the contract, he should

further allege an offer to restore these

benefits to the party furnishing them, if

restoration is possible; [and] (6) [l]astly,

that the moving party has no adequate remedy

at law.

Billian v. Mobil Corp., 710 So.2d 984, 991 (Fla. 4th DCA 1998).

In short, “Florida law ... gives an insurer the unilateral right

to rescind its insurance policy on the basis of misrepresentation

in the application of insurance.” Moustafa v. Omega Ins. Co., 201

So. 3d 710, 714 (Fla. 4th DCA 2016) (citation omitted).

To rescind the Policy based on a misrepresentation, MetLife

relies upon Fla. Stat. § 627.409(1), which provides:

(1) Any statement or description made by or on

behalf of an insured or annuitant in an

application for an insurance policy or annuity

contract, or in negotiations for a policy or

contract, is a representation and not a

warranty. Except as provided in subsection

(3), a misrepresentation, omission,

concealment of fact, or incorrect statement

may prevent recovery under the contract or

policy only if any of the following apply:

(a) The misrepresentation, omission,

concealment, or statement is fraudulent or is

material to the acceptance of the risk or to

the hazard assumed by the insurer.

(b) If the true facts had been known to the

insurer pursuant to a policy requirement or

other requirement, the insurer in good faith

would not have issued the policy or contract,

would not have issued it at the same premium

rate, would not have issued a policy or

contract in as large an amount, or would not

have provided coverage with respect to the

hazard resulting in the loss.

Under this statute, “misrepresentations, omissions, concealment of

facts, and incorrect statements on an insurance application will

not prevent a recovery under the policy unless they are either:

(1) fraudulent; (2) material to the risk being assumed; or (3) the

insurer in good faith either would not have issued the policy or

would have done so only on different terms had the insurer known

the true facts.” Certain Underwriters at Lloyd’s London v.

Jimenez, 197 So. 3d 597, 601 (Fla. 3d DCA 2016).

MetLife only relies upon the first portion of § 627.409(1)(a),

asserting that Dr. Liebowitz’s answers to the two questions in the

Application were “fraudulent” misrepresentations or statements.

3

(Doc. #80, pp. 18-19.) MetLife cites to the four elements of

fraudulent misrepresentation set forth in Butler v. Yusem, 44 So.

3d 102, 105 (Fla. 2010): “As we have stated, there are four

elements of fraudulent misrepresentation: ‘(1) a false statement

3

The Policy contains a “Time Limit on Certain Defenses”

provision, which provides: “After two years from the Effective

Date of this policy, or any policy change or reinstatement, no

misstatement, except fraudulent misstatements, made by You on the

Application can be used to void this policy or such policy change

or reinstatement, or to deny a claim under this policy or the

policy change or reinstatement, for a Disability starting after

the end of such two-year period.” (Doc. #58-1, p. 13.) The other

alternatives in the statute are admittedly time-barred by the two-

year provision. (Doc. #80, pp. 17-19.)

concerning a material fact; (2) the representor’s knowledge that

the representation is false; (3) an intention that the

representation induce another to act on it; and (4) consequent

injury by the party acting in reliance on the representation.’”

(citation omitted). (Doc. #80, p. 19). Dr. Liebowitz relies upon

an earlier Florida Supreme Court case, Lance v. Wade, 457 So. 2d

1008 (Fla. 1984), setting forth the same four elements. (Doc.

#89, p. 3.) Because proof of such fraud is difficult, “actual

fraud is not the most common circumstance under which insurers

avoid paying claims under insurance policies.” Mora v. Tower Hill

Prime Ins. Co., 155 So. 3d 1224, 1227 (Fla. 2d DCA 2015).

IV.

The parties’ summary judgment motions address coverage issues

only and whether MetLife may rescind the Policy under Florida law,

supra. MetLife asserts that it was and is entitled to rescind the

Policy based on Dr. Liebowitz’s fraudulent misrepresentations, and

therefore it is entitled to a judgment rescinding the Policy and

precluding coverage for Dr. Liebowitz’s disability claim. (Docs.

## 80, 90, 93.) Dr. Liebowitz, on the other hand, asserts that

for various reasons MetLife did not properly rescind the Policy

and cannot do so, and therefore he is entitled to coverage under

the Policy. (Docs. ## 78, 89, 91.)

A. Proof of Fraud

As discussed, one of the elements of MetLife’s rescission

claim requires that MetLife prove fraud by Dr. Liebowitz.

MetLife’s motion for summary judgment is primarily focused on this

issue. (Doc. #80.) Thus, the Court examines whether MetLife has

satisfied the four fraud elements with the undisputed facts.

(1) False Statement Concerning Material Fact

MetLife must establish that “a false statement concerning a

material fact” was made by Dr. Liebowitz. Butler, 44 So. 3d at

105. Such a false statement of fact must be about a past or

existing fact, not a prediction of a future event. Bailey v.

Covington, 317 So. 3d 1223, 1228 (Fla. 3d DCA 2021). Whether a

statement is material is measured by an objective standard. “The

test of materiality is not that the company was influenced but

that the facts, if truly stated, might reasonably have influenced

the company in deciding whether it should reject or accept the

risk.” Singer v. Nationwide Mut. Fire Ins. Co., 512 So. 2d 1125,

1128 (Fla. 4th DCA 1987) (citation omitted). A “truthful response

to a question based on his ‘knowledge and belief’ cannot be

considered a misstatement or misrepresentation in an insurance

policy rescission action.” William Penn Life Ins. Co. of New York

v. Sands, 912 F.2d 1359, 1360 (11th Cir. 1990).

Dr. Liebowitz argues that he did not make any false statements

about material facts because the Application questions are

ambiguous, call for a prediction and not a fact, and he answered

the ambiguous questions to the best of his knowledge and belief.

(Doc. #78, pp. 18-25; Doc. #89, p. 4.) Thus, the statements he

made in response to the Application questions cannot be the basis

of MetLife’s proof of fraud, and he is entitled to summary

4

judgment. (Doc. #78, pp. 17-25.) The Court disagrees, and for

the reasons set for the below, the answers to the two questions in

Dr. Liebowitz’s Application were both false and material as a

matter of law. Singer, 512 So. 2d at 1127.

It is certainly correct that an insurer may not deny coverage

“if the alleged misrepresentation was in response to an ambiguous

question. A question is ambiguous when it is susceptible to two

reasonable interpretations, one in which a negative response would

be correct and one in which an affirmative response would be

correct.” Mora, 155 So. 3d at 1228 (quoting Mercury Ins. Co. v.

Markham, 36 So. 3d 730, 733 (Fla. 1st DCA 2010)). The inquiry is

whether an objectively reasonable person, in the applicant’s

situation, “could truthfully answer the question in either the

affirmative or the negative.” Id. Whether a question in an

insurance application is ambiguous is question of law. Jimenez,

197 So. 3d at 600.

4

Dr. Liebowitz asserts this same position as part of his

Second and Third Affirmative Defenses, discussed infra. (Doc.

#58, pp. 5-7.)

(a) Question 5(i).

Question 5(i) asked, “Are you aware of any fact that could

change your occupational status or financial stability?” (Doc.

#58-1, p. 18.) Dr. Liebowitz answered, “No.” (Id.) Dr. Liebowitz

contends the question is ambiguous because a medical license

investigation does not prove the existence of any actual “fact”

that could change his occupational status or financial stability.

(Doc. #78, p. 19.) Dr. Liebowitz asserts that this question simply

asked him to predict what will happen to his license, rather than

to state an existing fact. (Id.)

The Court finds that this question is not ambiguous and does

concern a fact, not a prediction. At the time Dr. Liebowitz filled

out his Application, it was a fact that he was the subject of three

active and pending DOH Complaints regarding the medical care he

had provided to patients. The DOH Complaints sought revocation of

Dr. Liebowitz’s license, which would preclude him from practicing

medicine, his career of nearly 30 years. Dr. Liebowitz conceded

during his deposition that if the DOH found him guilty his license

could be revoked, and that the DOH had been seeking to have his

medical license revoked. (Doc. #80, ¶¶ 29, 36.) Nothing in the

question called upon the applicant to evaluate the merits of the

DOH Complaints or predict their success. As Dr. Liebowitz knew,

the investigation of the DOH was pending and “could” change both

his occupational status and his financial stability. An

objectively reasonable person in Dr. Liebowitz’s situation could

only truthfully answer Question 5(i) in the affirmative because,

as Dr. Liebowitz knew, the DOH proceedings were in fact pending

and could change his occupational status and financial stability.

(b) Question 17

Question 17 asked, “Have you EVER had a professional license

suspended, revoked, or is such license under review or have you

ever been disbarred?” (Doc. #58-1, p. 22.) Dr. Liebowitz

answered, “No.” (Id.) Dr. Liebowitz argues that the “under

review” portion is ambiguous because “under review,” “in the

context of an administrative proceeding to discipline a

professional license holder,” “really has no meaning.” (Doc. #78,

5

p. 24.)

The Court finds that this question is not ambiguous and does

concern a fact. The pertinent portion of the question asks whether

Dr. Liebowitz’s professional license is “under review.” Dr.

Liebowitz’s pending and active DOH proceedings included review of

the medical care he had provided and sought revocation of his

medical license, among other punishments. Dr. Liebowitz had two

attorneys reviewing his case and a proposed settlement had been

offered. Dr. Liebowitz was actively aware of and participating in

5

Dr. Liebowitz supported this argument with expert testimony.

That expert evidence was excluded by Court Order. (Doc. #94).

the proceedings. His medical license was clearly “under review”

at the time of the Application. Under these circumstances, an

objectively reasonable person in Dr. Liebowitz’s situation could

only truthfully answer Question 17 in the affirmative.

Therefore, the Court finds that the material undisputed

evidence shows that Dr. Liebowitz made false statements concerning

material facts when answering these two unambiguous Application

questions. MetLife has satisfied the first fraud element. Dr.

Liebowitz’s request for summary judgment based on ambiguous

questions (Doc. #78, pp. 17-25) is denied.

(2) Knowledge of Falsity

MetLife must next establish that the material undisputed

facts show Dr. Liebowitz’s knowledge that the representations were

false. Butler, 44 So. 3d at 105. MetLife has done so.

Dr. Liebowitz argues that he answered the questions “to the

best of his knowledge and belief,” suggesting he did not knowingly

answer falsely. (E.g., Doc. #78, p. 18-19; Doc. #91, p. 6-7.)

However, Dr. Liebowitz’s “belief” in the truthfulness of his

answers cannot contradict actual knowledge:

The twin qualifiers of knowledge and belief

require that knowledge not defy belief. What

the applicant in fact believed to be true is

the determining factor in judging the truth or

falsity of his answer, but only so far as that

belief is not clearly contradicted by the

factual knowledge on which it is based. In

such event, a court may properly find a

statement false as a matter of law, however

sincerely it may be believed. To conclude

otherwise would be to place insurance

companies at the mercy of those capable of the

most invincible self-deception — persons who

having witnessed the Apollo landings, still

believe the moon is made of cheese.

Casamassina v. U.S. Life Ins. Co. in City of New York, 958 So. 2d

1093, 1101 (Fla. 4th DCA 2007) (quoting Sands, 912 F.2d at 1365).

It is undisputed that Dr. Liebowitz knew of the DOH Complaints

and the investigation at the time he completed the Application.

Dr. Liebowitz admits this knowledge. The Court has also found

that the answer to each question was a false statement of fact.

MetLife has satisfied the second fraud element.

(3) Intent to Induce Reliance

MetLife must next demonstrate that Dr. Liebowitz had the

intent to deceive MetLife into providing disability insurance

coverage. Butler, 44 So. 3d at 105. “A false statement in the

abstract, even if knowingly made, does not constitute fraud;

indeed, what makes a false statement fraudulent is the declarant’s

intent that others rely upon it.” Philip Morris USA Inc. v.

Principe, No. 3D20-875, 2021 WL 4302370, at *6 (Fla. 3d DCA Sept.

22, 2021) (citing Butler, 44 So. 3d at 105). This element is often

established by circumstantial evidence. Glob. Quest, LLC v.

Horizon Yachts, Inc., 849 F.3d 1022, 1030 (11th Cir. 2017)

(citations omitted) (“elements of fraud—particularly intent and

knowledge—may be, and often are, proven by circumstantial

evidence”).

MetLife characterizes the evidence of intent in this case as

“overwhelming.” (Doc. #80, pp. 20-22.) MetLife cites

circumstantial evidence, including the pending and active DOH

Complaints, the timing of settlement negotiations of those DOH

Complaints, and Dr. Liebowitz’s actions at that time. (Doc. #80.)

Conversely, Dr. Liebowitz consistently maintains he believed his

answers to be truthful and had he no intent to induce MetLife to

provide him coverage through false statements, citing his own

declaration in support. (Doc. #74-1.) Dr. Liebowitz’s Second and

Third Affirmative Defenses also assert that Dr. Liebowitz answered

the Application questions based on his “reasonable interpretation”

of the questions, indicating he had no intent to deceive MetLife.

(Doc. #58, pp. 5-7.)

In fraud cases, summary judgment “is rarely proper as the

issue so frequently turns on the axis of the circumstances

surrounding the complete transaction, including circumstantial

evidence of intent and knowledge.” Glob. Quest, 849 F.3d at 1029.

When viewing the evidence in light most favorable to Dr. Liebowitz

as the nonmoving party on MetLife’s motion, a reasonable factfinder

could determine that Dr. Liebowitz lacked the intent to induce

MetLife’s reliance when falsely answering the Application

6

questions. Travelers Cas. & Sur. Co., 2014 WL 5325745, at *6 (“If

this Court finds the questions unambiguous, the question of whether

[the applicant] gave his responses with the intent to deceive must

be decided by [the factfinder].”) A dispute of fact remains, and

MetLife is not entitled to summary judgment on the third fraud

element.

(4) Consequent Injury

Finally, MetLife must establish that the material undisputed

facts prove that MetLife suffered a consequent injury when acting

in reliance on Dr. Liebowitz’s misrepresentations. Butler, 44 So.

3d at 105. This element is clearly established, since the

uncontradicted evidence is that MetLife would not have issued the

Policy if Dr. Liebowitz had disclosed the DOH Complaints and

investigations. MetLife has satisfied the fourth fraud element.

In sum, MetLife is entitled to partial summary judgment as to

the first, second, and fourth components of its fraud claim, but

not the third component.

6

Although, the Court is the factfinder on the coverage issue,

a district court should only grant summary judgment on cases slated

for a bench trial “when there are neither issues of credibility

nor controversies with respect to the substance of the proposed

testimony,” because a “trial on the merits would reveal no

additional data.” Fla. Int’l Univ. Bd., 830 F.3d at 1252.

(quotation omitted). At a minimum, there are clearly issues of

Dr. Liebowitz’s credibility to consider.

B. Promptness of Rescission

Another element of MetLife’s rescission claim, distinct from

the fraud elements, is “[t]hat the party seeking rescission has

rescinded the contract and notified the other party to the contract

of such rescission.” Billian, 710 So.2d at 991. Dr. Liebowitz

argues that MetLife cannot now actually rescind the Policy because

MetLife did not seek to rescind the Policy with reasonable

promptness. (Doc. #89, pp. 7-16, 20.) Therefore, according to

Dr. Liebowitz, MetLife waived any right to rescind the Policy,

MetLife’s motion should be denied, and Dr. Liebowitz’s motion is

due to be granted. (Id.)

As the Florida Supreme Court has stated:

[W]hen an insurer has knowledge of the

existence of facts justifying a forfeiture of

the policy, any unequivocal act which

recognizes the continued existence of the

policy or which is wholly inconsistent with a

forfeiture, will constitute a waiver thereof.

While, ordinarily, the insurer is not deemed

to have waived its rights unless it is shown

that it has acted with the full knowledge of

the facts, the intention to waive such rights

may be inferred from a deliberate disregard of

information sufficient to excite attention and

call for inquiry as to the existence of facts

by reason of which a forfeiture could be

declared.

Johnson v. Life Ins. Co. of Ga., 52 So. 2d 813, 815 (Fla. 1951).

“An insurer may impliedly waive its ability to rescind the policy

and deny recovery, however, if the insurer knows or has reason to

know of the misrepresentation but continues to accept premium

payments or otherwise lead the insured to believe that he or she

is still covered under the policy.” Girard v. Mid-W. Nat’l Life

Ins. Co. of Tennessee, No. 05-61506-CIV, 2005 WL 8155381, at *4

(S.D. Fla. Dec. 7, 2005). On the other hand, “[a]n insurer may

take a reasonable amount of time to investigate the facts

justifying rescission, though.” Girard, 2005 WL 8155381, at *3.

MetLife first argues that Dr. Liebowitz cannot argue that

MetLife’s lack of promptness constituted waiver because Dr.

Liebowitz did not plead waiver as an affirmative defense. (Doc.

#93, pp. 4-5.) But Dr. Liebowitz was not required to do so. E.g.,

Barber v. Am.’s Wholesale Lender, 542 F. App’x 832, 836 (11th Cir.

2013) (citing Rosique v. Windley Cove, Ltd., 542 So.2d 1014, 1016

(Fla. 3d DCA 1989)) (“The better view of Florida law is that

plaintiffs must affirmatively allege in their complaint that they

rejected the contract in a ‘reasonably prompt fashion’ after

discovering a mistake.”). MetLife’s promptness is part of

MetLife’s cause of action, which the Court has already found was

sufficiently pled in the Complaint (Doc. #59 at 4-5) and which Dr.

Liebowitz denied in his Answer (Doc. #58). This is sufficient to

raise the issue of waiver.

Turning to the merits of Dr. Liebowitz’s waiver argument, it

is undisputed that: (1) Dr. Liebowitz submitted his disability

claim in late December 2018 asserting a disability that began on

7

January 4, 2016; and (2) MetLife provided notice of its rescission

on December 30, 2019. (Doc. #80, ¶ 43; Doc. #97, ¶ 9(21).)

Dr. Liebowitz argues that MetLife unreasonably delayed

rescission for over a year with knowledge of the DOH Complaints,

and therefore MetLife waived any ability to rescind. (Doc. #89,

pp. 7-16.) In support of this argument, Dr. Liebowitz states that

as early as November 29, 2018, Theresa Woods, a MetLife claims

specialist and the original handler of his disability claim,

searched public licensing records which disclosed the DOH

Complaints. (Doc. #86-2, pp. 6-8; Doc. #87-3.) On December 28,

2018, Woods conducted a similar search, printing a record

disclosing the DOH complaints. (Doc. #87-7.) Woods did not share

this information with anyone else at MetLife, and between November

2018 and May 2019, she never inquired about the DOH Complaints or

Dr. Liebowitz’s answers to the Application questions while

investigating his claim. (Doc. #89, pp. 10-11.)

MetLife responds that the circumstances surrounding

rescission made the timing reasonable, and that it rescinded the

Policy once it was in possession of all material facts to justify

the rescission. (Doc. #93, p. 6.) MetLife cites Woods’ testimony

that she did not recall the application questions, and that Woods

was focused on collecting Dr. Liebowitz’s medical records given

7

See footnote 2.

his December 2018 disability claim for a January 2016 injury.

(Id.) MetLife also states that in June 2019, Jamie Frederick, a

senior claims advisor, took over Dr. Liebowitz’s claim. (Id. p.

7.) MetLife then details Frederick’s review of the DOH Complaints,

including communications with the DOH, communications with Dr.

Liebowitz, the refusal of premiums in November 2019, and the

ultimate approval of rescission by the claims director. (Id.)

MetLife argues that, under these circumstances, the time it took

to investigate Dr. Liebowitz’s back-dated disability claim and his

Application before rescinding the Policy was reasonable.

Based on the foregoing, there are disputed issues of material

fact concerning the promptness of MetLife’s rescission. Woods’

knowledge of the DOH Complaints for a year prior to rescission may

or may not render the rescission untimely. E. Portland Cement

Corp. v. F.L. Smidth Inc., 2009 WL 3010820, *6 (M.D. Fla. Sept.

16, 2009) (“whether the delay was reasonable is a question of fact

that precludes summary judgment on the issue of rescission”).

Accordingly, the reasonable promptness of MetLife’s rescission

remains a triable matter on the coverage issue.

C. Affirmative Defenses

While partial summary judgment for MetLife is appropriate on

certain fraud elements of MetLife’s rescission claim, as discussed

supra, Dr. Liebowitz has asserted affirmative defenses which could

preclude MetLife from prevailing. MetLife moves for summary

judgment on all affirmative defenses, so the Court discusses each

in turn. (Doc. #80, pp. 22-27.)

(1) Failure to State Claim

The First Affirmative Defense asserts that MetLife’s

Complaint fails to state a cause of action upon which relief may

be granted. (Doc. #58, p. 4.) The Court has twice rejected this

argument (Docs. #54, 59), and does so again. Partial judgment

will be entered against Dr. Liebowitz and in favor of MetLife as

to the First Affirmative Defense because MetLife has stated a cause

of action upon which relief may be granted.

(2) and (3) Answering Ambiguous Questions

Dr. Liebowitz’s Second and Third Affirmative Defenses assert

that the Application questions were ambiguous and that Dr.

Liebowitz cannot be found to have made misstatements on his

Application because he answered the questions based on his

reasonable interpretation of the questions. (Doc. #58, pp. 5-7.)

As discussed supra, the Court finds that the questions are not

ambiguous. However, a question of fact remains as to Dr.

Liebowitz’s intent. The Second and Third Affirmative Defenses

remain to the extent these defenses argue Dr. Liebowitz’s intent

to induce reliance through fraudulent misstatements.

(4) and (5) Non-Conforming Policy Language

Dr. Liebowitz’s Fourth and Fifth Affirmative Defenses assert

that language in the Policy fails to conform with mandatory Florida

law, which requires that the Policy be modified in such a way which

precludes rescission. (Doc. #58, pp. 7-8; see also Doc. #78, pp.

12-15.) This argument is also asserted as part of Dr. Liebowitz’s

Counterclaim Count I and his motion for summary judgment. (Doc.

#58, p. 16; Doc. #78, pp. 12-15.)

Florida law requires that certain language be contained in

insurance policies in Florida. One such requirement, pertinent to

this litigation, is Fla. Stat. § 627.607(1), which requires the

following provision:

“Time Limit on Certain Defenses: After 2 years

from the issue date, only fraudulent

misstatements in the application may be used

to void the policy or deny any claim for loss

incurred or disability starting after the 2-

year period.”

Fla. Stat. § 627.607(1) (emphasis added.) However, Florida law

then provides alternative language, which may be substituted by

the insurer:

(2) A policy may, in place of the provision

set forth in subsection (1), include the

following provision:

“Incontestable:

(a) Misstatements in the Application: After

this policy has been in force for 2 years

during the insured’s lifetime (excluding any

period during which the insured is disabled),

the insurer cannot contest the statements in

the application.

(b) Preexisting Conditions: No claim for loss

incurred or disability starting after 2 years

from the issue date will be reduced or denied

because a sickness or physical condition, not

excluded by name or specific description

before the date of loss, had existed before

the effective date of coverage.”

Fla. Stat. § 627.607(2) (emphasis added). The actual Policy

language provides as follows:

“Time Limit on Certain Defenses: After two

years from the Effective Date of this policy,

or any policy change or reinstatement, no

misstatement, except fraudulent

misstatements, made by You on the Application

can be used to void this policy or such policy

change or reinstatement, or to deny a claim

under this policy or the policy change or

reinstatement, for a Disability starting after

the end of such two-year period.”

(Doc. #58-1, p. 13) (emphasis added).

Dr. Liebowitz argues that the Policy language fails to match

the mandatory statutory language because the Policy provision

measures the two-year period from the “effective date” of the

Policy instead of the “issue date.” (Doc. #78, pp. 12-15.) Dr.

Liebowitz contends that this deviation requires the current Policy

provision to be stricken and the language of § 627.607(2) to be

imported into the Policy.

The Court agrees that the “effective date” and “issue date”

are not necessarily the same. For example, the “effective date”

as defined by the Policy is March 6, 2015, while the “issue date”

is not defined in the Policy but could arguably be as late as May

3, 2015 when the Policy was delivered to Dr. Liebowitz. But the

Florida legislature has provided a remedy for such a situation,

which does not include striking one provision and importing other

language. A Florida statute provides:

The contract may include the following

provision:

“Conformity with State Statutes: Any provision

of this policy which, on its effective date,

is in conflict with the statutes of the state

in which the insured resides on such date is

hereby amended to conform to the minimum

requirements of such statutes.”

Fla. Stat. § 627.627. The Policy expressly includes this

provision, stating:

Any provision in this policy which, on the

Effective Date, conflicts with the laws of the

state in which You reside on that date is

amended to meet the minimum requirements of

such laws.

(Doc. #58-1, p. 13.). See also Fla. Stat. § 627.418 (an otherwise

valid policy not in compliance with the requirements of the code

is not invalid but shall be construed and applied as if in full

compliance).

Thus, the Policy is deemed to include the two-year provision

required by Florida statute, and does not have non-conforming

provisions. Dr. Liebowitz’s request for summary judgment (Doc.

#78, pp. 12-15) based on the Policy’s nonconforming language is

denied. MetLife is also entitled to partial judgment as to the

Fourth and Fifth Affirmative Defenses.

(6) and (7) Equitable Estoppel

Dr. Liebowitz’s Sixth and Seventh Affirmative Defenses assert

two theories of equitable estoppel. The Sixth Affirmative Defense

argues that MetLife cannot rescind the Policy because the insurance

agent who assisted Dr. Liebowitz with his application was allegedly

employed by MetLife and did not advise him to disclose the DOH

Complaints. (Doc. #58, p. 8.) MetLife seeks judgment on this

defense because Dr. Liebowitz’s own deposition testimony made

clear that the insurance agent that helped him did not work for

MetLife. (Doc. #80, p. 25 n.8.)

The Seventh Affirmative Defense argues that MetLife cannot

rescind the Policy based on a fraud standard because MetLife’s

rescission letter did not put Dr. Liebowitz on notice of his

alleged fraud. (Doc. #58, p. 8.) MetLife seeks judgment on this

defense because the rescission letter quoted the “Time Limit on

Certain Defenses” provision, which clearly details fraudulent

misstatements. (Doc. #80, p. 25.)

Dr. Liebowitz’s Response does not dispute or otherwise

counter MetLife’s facts or arguments, abandoning these

affirmatives defenses. (See Doc. #89.) E.g., Haasbroek v.

Princess Cruise Lines, Ltd., 286 F. Supp. 3d 1352, 1358 n.4 (S.D.

Fla. 2017) (“When a party fails to address a specific claim, or

fails to respond to an argument made by the opposing party, the

Court deems such claim or argument abandoned.”) In any event,

there are no issues of disputed material facts which would prevent

summary judgment in MetLife’s favor. MetLife is entitled to

partial judgment as to the Sixth and Seventh Affirmative Defenses.

(8) Statute of Limitations

Dr. Liebowitz’s Eighth (and final) Affirmative Defense

asserts that MetLife’s rescission based on fraud is barred by the

applicable Florida statute of limitations. MetLife moves for

summary judgment on this defense. (Doc. #80, p. 25.) Dr.

Liebowitz also moves for summary judgment based on the statute of

limitations. (Doc. #78, pp. 15-17.)

Both parties agree that the applicable statute of limitations

for MetLife’s rescission claim is four years because MetLife’s

claim is based in fraud. See Fla. Stat. § 95.11(3)(j). (Doc.

#78, p. 15; Doc. #90, p. 13.) But the parties disagree on when

MetLife’s claim accrued and whether the claim is time-barred.

MetLife asserts that its claim accrued in December 2018, after Dr.

Liebowitz submitted his disability claim. (Doc. #90, pp. 13-14.)

Dr. Liebowitz asserts that MetLife’s claim accrued at the time of

his Application and the Policy’s issuance (between March and May

2015) because: (1) MetLife could have, with due diligence,

discovered the misstatements in the Application in 2015; and (2)

MetLife did not plead delayed discovery. (Doc. #78, p. 16; Doc.

#89, pp. 16-20; Doc. #91, pp. 5-6.)

Under Florida law, the statute of limitations begins to run

when the cause of action accrues. Hearndon v. Graham, 767 So. 2d

1179, 1185 (Fla. 2000). Generally, a cause of action accrues, and

the statute of limitations therefore begins to run, on the date

the last element constituting the cause of action occurs. Id. at

1184–85 (citing Fla. Stat. § 95.031). In fraud claims, however,

the “delayed discovery rule” may postpone the running of the

statute of limitations until “the facts giving rise to the cause

of action were discovered or should have been discovered with the

exercise of due diligence.” Fla. Stat. § 95.031(2)(a). As a

general rule, an insurer is entitled to rely on statements in an

application and does not need to search public records to verify

them. Indep. Fire Ins. Co. v. Arvidson, 604 So. 2d 854, 856 (Fla.

4th DCA 1992)) (“[a]n insurer is entitled to rely upon the accuracy

of the information in an application, and has no duty to make

additional inquiry”); Nembhard v. Universal Prop. & Cas. Ins. Co.,

No. 3D20-1383, 2021 WL 3640525, at *3 (Fla. 3d DCA Aug. 18, 2021)

(citations omitted) (“An insurance company has the right to rely

on an applicant’s representations in an application for insurance

and is under no duty to inquire further, unless it has actual or

constructive knowledge that such representations are incorrect or

untrue.”).

The record establishes the following chronology:

•

January 30, 2015: Dr. Liebowitz signs the Application.

(Doc. #97, ¶ 9(1).)

•

April 16 – May 3, 2015: The Policy issues with an

effective date of March 6, 2015. (Id. ¶ 9(4).)

•

May 3, 2015: MetLife delivers the Policy to Dr.

Liebowitz. Dr. Liebowitz signs an Amendment to the

Application, affirming “[t]here are no facts or

circumstances which would require a change in the

answers in the application.” (Id. ¶ 9(7).) MetLife

undertakes no further investigation into Dr. Liebowitz

or his Application. (Id. ¶ 9(8).)

•

September 18, 2018: MetLife mails a claims form to Dr.

Liebowitz. (Doc. #87-1.)

•

November 15, 2018: MetLife mails a second letter to Dr.

Liebowitz asking whether he intends to follow through

with his disability claim. (Doc. #87-2.)

•

November 29, 2018: Woods accesses the DOH website and

prints Dr. Liebowitz’s medical licensing information.

(Doc. #87-3.)

•

December 18, 2018: Dr. Liebowitz files his initial

claims forms for benefits. (Doc. #80, ¶43.)

•

December 28, 2018: Woods prints additional information

from the DOH website concerning Dr. Liebowitz’s medical

licensing. (Docs. ## 87-6, 87-7.)

•

December 2018 – December 2019: MetLife investigates Dr.

Liebowitz’s disability claim.

•

December 30, 2019: MetLife sends Dr. Liebowitz a Notice

of Rescission. (Doc. #97, ¶9(21).)

•

April 15, 2020: MetLife files federal lawsuit. (Doc.

#1.)

Based on this record, MetLife’s rescission claim accrued, at

the earliest, on November 29, 2018, when Woods reviewed the DOH

website and arguably could have, with due diligence, discovered

the DOH Complaints. The record contains no evidence to suggest

that MetLife had actual or constructive knowledge that the

Application statements were false, and so MetLife was entitled to

rely on Dr. Liebowitz’s statements in his Application without any

additional inquiry. MetLife’s April 15, 2020 complaint was timely.

Dr. Liebowitz’s argument that MetLife was required to

affirmatively plead delayed discovery also fails. The statute of

limitations is an affirmative defense, and MetLife need not have

negated it in its Complaint, La Grasta v. First Union Sec., Inc.,

358 F.3d 840, 845 (11th Cir. 2004), nor have filed a reply. Fed.

R. Civ. P. 12(a)(1)(C); Miller v. Abercrombie & Kent, Inc., No.

08-61471-CIV, 2009 WL 259672, at *1 (S.D. Fla. Feb. 4, 2009) (no

requirement in federal pleading that a reply to affirmative

defenses be filed). Dr. Liebowitz motion for summary judgment

based on the statute of limitations is denied. (Doc. #78, pp. 15-

17.) MetLife is entitled to partial judgment as to the Eighth

Affirmative Defense.

D. Summary

The Court denies Dr. Liebowitz’s motion for summary judgment

in its entirety. As to MetLife’s motion, the Court grants partial

summary judgment in favor of MetLife on the first, second, and

fourth components of the fraud elements of MetLife’s rescission

claim. The Court also enters partial summary judgment in favor of

MetLife on the First, Fourth, Fifth, Sixth, Seventh, and Eighth

Affirmative Defenses.

Pursuant to Fed. R. Civ. P. 56(g), the Court finds that the

following material facts are not genuinely in dispute and will

treat them as established for the coverage determination in this

case:

1. Dr. Liebowitz made false statements concerning material

facts when answering Questions 5(i) and 17 in the Application.

2. Dr. Liebowitz knew the representations he made when

answering Questions 5(i) and 17 in the Application were false.

3. MetLife was consequently injured when acting in reliance

of Dr. Liebowitz’s misrepresentations.

4. The Policy includes the provision set forth in Fla. Stat.

§ 627.607(1).

5. Dr. Liebowitz was not assisted by a MetLife insurance

agent when filling out the Application.

6. MetLife put Dr. Liebowitz on notice of its intent to

rescind the Policy based on Dr. Liebowitz’s alleged fraud.

7. MetLife relied on the statements made by Dr. Liebowitz

in his Application in 2015 and did not investigate his answers

until after Dr. Liebowitz filed his claim.

E. Motion for Entry of Judgement

As a final matter, also pending before the Court is Dr.

Liebowitz’s Motion for Entry of Judgment Under Rule 54(b) Following

Entry of Partial Summary Judgment (Doc. #95), filed on October 27,

2021. In this motion, Dr. Liebowitz assumes he will prevail on

the coverage issue following these cross motions for summary

judgment, and requests the Court enter judgment in his favor.

Since this did not happen, the motion is denied.

Accordingly, it is now

ORDERED :

1. Dr. Liebowitz’s motion for summary judgment (Doc. #78)

is DENIED.

2. MetLife’s motion for summary judgment (Doc. #80) is

DENIED IN PART AND GRANTED IN PART, as set forth above.

3. Dr. Liebowitz’s motion for entry of judgment under Rule

54(b) (Doc. #95) is DENIED.

4. The Clerk shall withhold entry of partial summary

judgment until further order by the Court.

5. The Court will schedule a bench trial on the remaining

coverage issues in a separate order.

DONE and ORDERED at Fort Myers, Florida, this 11th day

of January, 2022.

po mae Ae

re. Akiel

JGHN E. STEELE

SHNIOR UNITED STATES DISTRICT JUDGE

Copies:

Counsel of Record