Michael Vogt v. State Farm Life Insurance Comp ( 2021 )

United States Court of Appeals
For the Eighth Circuit
___________________________
No. 20-3481
___________________________
Michael G. Vogt
Plaintiff - Appellee
v.
State Farm Life Insurance Company
Defendant - Appellant
___________________________
No. 21-1370
___________________________
Michael G. Vogt
Plaintiff - Appellee
v.
State Farm Life Insurance Company
Defendant - Appellant
____________
Appeal from United States District Court
for the Western District of Missouri - Jefferson City
____________
Submitted: September 23, 2021
Filed: December 8, 2021
____________
Before SHEPHERD, WOLLMAN, and KOBES, Circuit Judges.
____________
SHEPHERD, Circuit Judge.
Following this Court’s previous opinion in Vogt v. State Farm Life Insurance
Co., 963 F.3d 753 (8th Cir. 2020), which affirmed the award of a $34.3 million jury
verdict in favor of the class represented by Michael Vogt and reversed the district
court’s denial of prejudgment interest, we remanded the matter for the district court
to reconsider Vogt’s motion for prejudgment interest consistent with our opinion.
After a hearing, the district court1 awarded $4,521,674.38 in prejudgment interest.
Despite the directive in our previous opinion stating that Vogt was entitled to
prejudgment interest, State Farm Life Insurance Company (State Farm) appeals,
asserting that the district court erred in awarding prejudgment interest. Having
jurisdiction under 28 U.S.C. § 1291, we affirm.
I.
As detailed in our previous decision, Michael Vogt is the named plaintiff for
a roughly 25,000 member class who alleged breach of contract and conversion
claims against State Farm related to State Farm’s collection of cost of insurance
(COI) fees from life insurance policyholders. Vogt alleged that State Farm
impermissibly collected COI fees based on factors that were not enumerated in the
policy language. Following a jury trial and a $34.3 million verdict in favor of Vogt,
State Farm appealed, raising numerous claims as to why the jury verdict should be
overturned. Vogt filed a cross-appeal, arguing that the district court erroneously
denied the class an award of prejudgment interest on the jury award. We affirmed
the verdict in all respects, rejecting each of State Farm’s meritless arguments, but
reversed the district court’s denial of Vogt’s motion for prejudgment interest,
concluding that, while Vogt was not entitled to prejudgment interest at the rate
The Honorable Nanette K. Laughrey, United States District Judge for the
1
Western District of Missouri.
-2-
contained in a Missouri statute, Mo. Rev. Stat. § 408.020, he was entitled to
prejudgment interest at the 4% interest rate contained in the policy.
In reversing the district court’s denial of prejudgment interest, we expressly
stated that “Vogt is entitled to prejudgment interest at the 4% rate contained in the
contract.” Vogt, 963 F.3d at 776. On remand, the district court held a hearing to
calculate the award of prejudgment interest. At this hearing, State Farm asserted
that Vogt was not entitled to prejudgment interest because the damages were not
liquidated, as required for an award of prejudgment interest, and our previous
decision did not make a finding that the damages were liquidated. State Farm also
argued that prejudgment interest could not be awarded where the general verdict did
not differentiate between the contract claim, to which prejudgment interest may be
awarded, and the conversion claim, to which prejudgment interest may generally not
be awarded. State Farm finally argued that class members who still held their
policies as of December 1, 2017—the final date for which State Farm produced
policy data and the cut-off date for which Vogt’s expert calculated damages—were
not entitled to prejudgment interest because the damages model selected by the jury
already included interest at the contractual rate for these class members and an award
of prejudgment interest to these class members would amount to a double recovery.
The district court rejected each of these arguments, concluding that our
statement that “Vogt is entitled to prejudgment interest at the 4% rate contained in
the contract” conclusively resolved the issue of liquidated damages, or, in the
alternative, damages were readily determinable and thus liquidated; Vogt’s success
on the conversion claim, for which he was not entitled to prejudgment interest, did
not affect entitlement to prejudgment interest on the contract claim; and
policyholders as of the last date for which State Farm produced policy data were
entitled to prejudgment interest because it was undisputed that the jury award did
not include any interest for the period after the cut-off date, and thus there would be
no double recovery. The district court then adopted the prejudgment interest
calculation presented by Vogt’s expert and entered an award of prejudgment interest
in the amount of $4,521,674.38. State Farm appeals.
-3-
II.
State Farm asserts that the district court erred in awarding prejudgment
interest, raising the same three issues that it argued before the district court. “‘We
review the district court’s ruling on prejudgment interest for an abuse of discretion.’
However, the question of ‘[w]hether the district court had the authority to grant
prejudgment interest is a question of state law which we review de novo.’” Child.’s
Broad. Corp. v. Walt Disney Co., 357 F.3d 860, 868 (8th Cir. 2004) (alteration in
original) (citations omitted). State Farm’s primary challenge in its second appeal
concerns whether damages were liquidated, which is a prerequisite under Missouri
law for an award of prejudgment interest. See Macheca Transp. Co. v. Phila. Indem.
Ins. Co., 737 F.3d 1188, 1196 (8th Cir. 2013). State Farm asserts that our previous
decision did not decide whether the damages were liquidated, and, on remand, the
district court erroneously concluded both that this Court decided the issue and that,
in the alternative, damages were liquidated.
“When an appellate court remands a case to the district court for further
proceedings consistent with the appellate decision, all issues the appellate court
decides become the law of the case.” Marshall v. Anderson Excavating & Wrecking
Co., 8 F.4th 700, 711 (8th Cir. 2021) (citation omitted). Known as the
“law-of-the-case doctrine,” this rule dictates that “courts must ‘follow decisions
made in earlier proceedings to prevent the relitigation of settled issues in a case,
thereby protecting the settled expectations of parties, ensuring uniformity of
decisions, and promoting judicial efficiency.’” Id. (citation omitted).
In framing the issue raised by Vogt in the previous appeal, we stated the
following:
On cross-appeal, Vogt asserts that the district court erred by denying
prejudgment interest, arguing that a Missouri statute mandates
prejudgment interest on liquidated claims for breach of contract, which
is the type of claim the class pursued, and that the same statute applies
to conversion claims. Vogt contends that the district court erroneously
-4-
determined that the policy precluded the award of prejudgment interest
at the statutory rate, and, at the very least, should have awarded
prejudgment interest by utilizing the 4% rate included in the policy.
Vogt, 963 F.3d at 775. We then recognized that an award of prejudgment interest
was contingent upon the existence of liquidated damages. We first concluded that
the district court did not err in denying prejudgment interest at the statutory rate
because the parties had agreed to a different interest rate in the policy. We next
concluded that the district court should have awarded prejudgment interest at the 4%
policy rate, stating that “[a]lthough we conclude the district court correctly denied
Vogt’s request for prejudgment interest at the statutory rate, Vogt is entitled to
prejudgment interest at the 4% rate contained in the contract.” Id. at 776 (emphasis
added). Thus, our recognition that an award of prejudgment interest required the
presence of liquidated damages, coupled with our statement that Vogt is entitled to
prejudgment interest, conclusively determined that the damages were liquidated.
Indeed, as the district court noted, to conclude that we did not resolve the issue of
liquidated damages would contradict our express statement that Vogt is entitled to
prejudgment interest.
Given the foregoing, we are simply unpersuaded by State Farm’s argument
that the previous panel opinion left open the question of whether the damages were
liquidated. Our determination that Vogt is entitled to prejudgment interest bound
the district court on remand just as it binds us on this second appeal. See Marshall,
8 F.4th at 711. Because we conclude that the prior opinion addressed whether the
damages were liquidated, we need not review the district court’s alternative analysis.
Further, we are also unpersuaded by State Farm’s remaining arguments regarding
the general jury verdict and the current policyholders as of the cut-off date. We
adopt the thorough reasoning of the district court in rejecting these claims and
conclude that the district court did not err in awarding $4,521,674.38 in prejudgment
interest to Vogt.
-5-
III.
For the foregoing reasons, we affirm the judgment of the district court.
______________________________
-6-