Levy, Lawrence B. v. MN Life Insur Co

In the
United States Court of Appeals
For the Seventh Circuit
____________

No. 07-1006
LAWRENCE B. LEVY, M.D.,
Plaintiff-Appellant,
v.

MINNESOTA LIFE INSURANCE COMPANY,
formerly known as Minnesota
Mutual Life Insurance Company,
Defendant-Appellee.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 03 C 5141—Sidney I. Schenkier, Magistrate Judge.
____________
ARGUED DECEMBER 5, 2007—DECIDED FEBRUARY 25, 2008
____________

Before FLAUM, EVANS, and WILLIAMS, Circuit Judges.
EVANS, Circuit Judge. In this insurance dispute, the
plaintiff, Dr. Lawrence B. Levy, and the defendant,
Minnesota Life Insurance Company (MLI), agree that
Levy suffers from osteoarthritis in his right knee, which
prevents him from performing his occupational duties
and qualifies him for disability coverage under two policies
issued by MLI. The parties disagree, however, on which
provision of the policies applies, which, in turn, affects the
duration of coverage. Levy claims that he qualifies for
coverage under the “injury” provision, which entitles him
to lifetime disability benefits. MLI, on the other hand,
2 No. 07-1006

claims that Levy qualifies for coverage under the “sick-
ness” provision, which only entitles him to benefits he
has received for the 6-year period that ended after he
turned 65 years old in 2003.
The district court (Magistrate Judge Sidney Schenkier,
sitting with the parties’ consent, 28 U.S.C. § 636(c))
resolved the parties’ cross-motions for summary judgment
in favor of MLI. The case is now before us on Levy’s
appeal. We review a grant of summary judgment de novo.
Tanner v. Jupiter Realty Corp., 433 F.3d 913, 915 (7th Cir.
2006). Summary judgment is proper if “there is no gen-
uine issue as to any material fact and [ ] the moving party
is entitled to a judgment as a matter of law.” Fed. R. Civ.
P. 56(c).
The facts are without genuine dispute. In the early
1980s, MLI issued two disability insurance policies to Dr.
Levy. The policies define “disability” and “disabled” to
mean that “due to sickness or injury you are unable to
perform the substantial and material duties of your
regular occupation.” The policies define “injury” as “[a]n
accidental bodily injury you sustained while this policy
is in force” and “sickness” as “[a] disease or illness which
is diagnosed or treated while this policy is in force.” The
policies provide a maximum benefit period to age 65 if
the insured is disabled due to a “sickness” but lifetime
benefits if the disability is due to an “injury.”
In 1987, Levy claims to have injured his right knee
while playing basketball at a picnic. He experienced pain
for 2 or 3 weeks, which he self-treated with anti-inflam-
matories. Levy did not seek medical treatment for his
knee until 1989, at which point he was examined by
Dr. Bruce Hallmann, an orthopedic surgeon.
In February 1989, Dr. Hallmann performed arthroscopic
surgery on Levy’s right knee on an outpatient basis. His
preoperative diagnosis was “[i]nternal derangement—right
No. 07-1006 3

knee.” His post-operative diagnosis was “[c]omplex degen-
erative tear of posterior horn of medial meniscus, [and]
advanced chrondromalacia[.]” Dr. Hallmann noted that
Levy “had a long history of problems with his right knee,”
and “has had progressive difficulties with pain and
clicking at the right knee.” Dr. Hallmann also wrote that
Levy had “apparently injured the right knee many years
ago, but underwent no specific therapeutic intervention.”
Dr. Hallmann’s notes do not mention the 1987 basket-
ball incident.
In his deposition, Dr. Hallmann explained that the
reference in his report to a “long history” of right knee
problems did not mean “a problem two years before [the
1989 surgery]” because he “would have probably indicated
that” in his notes. Rather, he stated that “[w]hen I say a
long history of many years, I don’t usually mean just a
year or two. It’s usually longer than that.” Dr. Hallmann
also testified that “[i]ndividuals can develop degenerative
meniscal cartilage tears in association with osteoarthritis.”
He described Levy’s degenerative tear at the time of the
1989 surgery as follows:
This was not a fresh meniscal cartilage tear. It wasn’t
a matter that the cartilage had a very clear and
clean—it was not a clean or clear cartilage tear. The
cleavage planes were not well defined. They had
already become degenerated. They had become frayed,
fibrillated, [of] irregular character and contour. So
this was not a recent tear of the medial meniscus.
[A]nd, in fact, degenerative changes had already taken
place at the tear site.
Dr. Hallmann further stated that he was unable to
determine, based on his medical records, whether the
degenerative meniscal tear noted in his report was the
result of a specific trauma or a degenerative process such
as osteoarthritis.
4 No. 07-1006

About 3 weeks after the arthroscopic surgery, Levy
returned to work and resumed his normal duties as a
physician. Levy continued to work for the next 7 years,
during which time he did not seek medical diagnosis or
treatment for his knee.
During the early 1990s, Levy’s coverage under MLI’s
policies lapsed due to nonpayment of premiums. To obtain
reinstatement of coverage, Levy made several certifica-
tions regarding his medical condition. On four occasions
during 1992 to 1994, Levy certified that he “ha[d] not
suffered a disability, been injured or sick” since the end of
the policies’ premium payment grace periods. In a 1994
application for life insurance coverage with MLI, Levy
also certified that he had made a “Full Recovery” from
his arthroscopic surgery and had experienced “no prob-
lems since.”
In 1980, a little over a year before the policies here were
issued, Dr. Levy worked at the Flashner Medical Group,
which he described as an “urgent and immediate care”
facility with offices in Mount Prospect and Arlington
Heights, Illinois. Levy stopped working for the Flashner
Group on June 30, 1994, when it was sold to the New York
Life Insurance Company. Levy did not practice for a year
after the buyout because, apparently, he received, as part
of the Flashner buyout, a year’s salary from New York
Life. When the year ran out, Levy took a position as an
independent contractor (with a group, Wexford Health
Services) providing medical services for the Illinois
Department of Corrections at its Dwight Correctional
Center, a maximum security prison in Dwight, Illinois,
some 60 miles south of downtown Chicago. He held that
spot for 6 months, until February 29, 1996, when a new
contractor took over his duties at Dwight. On that day,
Levy was 58 years old. He has not worked since that day.
Two months after leaving Dwight, Levy submitted a
disability claim to MLI in which he claimed to be disabled
No. 07-1006 5

due to right knee pain. When MLI requested documenta-
tion in support of his claim, Levy sought medical attention
from Dr. Chadwick Prodromos, an orthopedic surgeon.
After examining Levy, Dr. Prodromos diagnosed him
with “Right knee DJD versus medial meniscal injury.”1
Dr. Prodromos also obtained an MRI on Levy’s right
knee from a radiologist, Dr. Paul Backas. Dr. Backas
reported that the MRI showed “[t]hinning, altered signal
intensity and medial subluxation of body medial meniscus
consistent with degenerative change with no macro-
meniscal tear identified2.” Dr. Prodromos’ notes state
that the MRI “would appear to be consistent with DJD
and not internal derangement.” In the same note, Dr.
Prodromos stated that, based on his review of Dr.
Hallmann’s report, “[b]oth the diagnosis and the proce-
dure at that time certainly were consistent with [Levy’s]
current advanced degenerative joint disease.”
In May 1996, Dr. Prodromos signed an Attending
Physician Statement (APS), diagnosing Levy with right
knee osteoarthritis and limiting him to sedentary work.
The APS was used as the proof of loss that Levy sub-
mitted to MLI regarding his disability. Dr. Prodromos
examined Levy on four additional occasions during
1997 through 2002. He completed six supplemental APS
forms, each repeating his diagnosis of osteoarthritis/
degenerative joint disease.
In his deposition, Dr. Prodromos testified regarding the
origin or cause of Levy’s osteoarthritis. He first opined

1
“DJD” is short for “degenerative joint disease.” Dr. Prodromos
testified that he uses the terms “osteoarthritis” and “degenera-
tive joint disease” interchangeably.
2
Based on his review of the report, Dr. Prodromos stated that
the correct term was “micromeniscal,” not “macromeniscal,” tear.
6 No. 07-1006

that “Dr. Levy’s basketball injury caused the meniscal tear
on which Dr. Hallmann operated” and that “his knee
arthritis was caused by the meniscal tear.” Dr. Prodromos
gave a more comprehensive explanation shortly thereafter:
It is my opinion to a reasonable degree of orthopaedic
surgical certainty that his severe right knee pain
was—is directly attributable to the meniscal tear,
indirectly. When I saw him he wasn’t hurting because
of a meniscal tear. It was occurring because the
meniscal tear had caused the sequence of events of
articular cartilage damage and arthrosis and pain
in his knee.
Dr. Prodromos also stated that “[a]ll meniscal tears are
caused by trauma, even so-called degenerative tears.”
In 2005, Dr. David Waldram, an orthopedic surgeon
consulted by MLI, concurred with the diagnosis of
osteoarthritis/degenerative joint disease based on his
review of Levy’s medical records and the testimony of
Drs. Hallmann and Prodromos. Dr. Waldram further
opined that Levy’s osteoarthritis “is not in all medical
probability related to the injury of 1987.” According to Dr.
Waldram, the 1989 operation report contains findings
consistent with degenerative arthritis and a degenerative
meniscal tear, and these degenerative changes predated
the 1987 basketball injury.
Dr. Waldram also pointed to other medical evidence
that Levy’s arthritis was not caused by the 1987 basket-
ball incident. For example, Dr. Waldram stated that
osteoarthritis typically presents unilaterally and asymmet-
rically. Thus, the fact that Levy’s arthritis appears in
his right knee does not support that the arthritis was
caused by an injury to the right knee. Dr. Waldram also
stated that Levy has symptoms of osteoarthritis in other
areas of his body not involved in the 1987 incident—
namely, his spine, left knee, and right hip. Dr. Waldram
No. 07-1006 7

indicated that Levy’s right hip arthritis could not be
related to overcompensation on account of the right knee
arthritis because overcompensation would occur on the
opposite side.
MLI initially declined Levy’s disability claim on the
basis that the policies had lapsed due to nonpayment of
premiums. After Levy filed suit, the parties settled the
coverage dispute and, consequently, MLI paid $7,000 a
month in disability benefits to Levy from July 31, 1997,
through June 11, 2003 (the policies’ first anniversary date
after Levy’s 65th birthday).3 The parties did not set-
tle—and specifically reserved the right to adjudicate—the
legal question of whether Levy’s disability falls within
the policies’ “sickness” or “injury” coverage.
Under Illinois law,4 an insurance policy is subject to the
general rules governing the interpretation of other types of
contracts. Hobbs v. Hartford Ins. Co. of the Midwest, 823
N.E.2d 561, 564 (Ill. 2005). Our primary objective is
to ascertain the intent of the parties, as expressed in
the policy’s language. Gillen v. State Farm Mut. Auto. Ins.
Co., 830 N.E.2d 575, 582 (Ill. 2005). We construe the policy
as a whole, giving unambiguous words their plain, ordi-
nary, and popular meaning. Outboard Marine Corp. v.
Liberty Mut. Ins. Co., 607 N.E.2d 1204, 1212 (Ill. 1992).
Words are ambiguous only if they are susceptible to more
than one reasonable interpretation. USF&G v. Wilkin
Insulation Co., 578 N.E.2d 926, 930 (Ill. 1991). In that
case, they will be construed against the drafter. Id.
Nevertheless, we are not to adopt a “strained, forced,
unnatural, or unreasonable construction, or one which

3
This means Levy has already received about a half a million
dollars in benefit payments from MLI.
4
There is no dispute that the substantive law of Illinois applies
in this diversity action.
8 No. 07-1006

would lead to an absurd result[.]” U.S. Fire Ins. Co. v.
Hartford Ins. Co., 726 N.E.2d 126, 128 (Ill. App. Ct. 2000).
The policies define “injury” as “[a]n accidental bodily
injury you sustained while this policy is in force” and
“sickness” as “[a] disease or illness which is diagnosed or
treated while this policy is in force.” Levy’s 1987 basketball
incident qualifies as an “injury,” and his 1996 diagnosed
condition of osteoarthritis qualifies as a “sickness” under
the policies. However, the policies only provide coverage if
the insured is “disabled,” meaning that, “due to sickness or
injury, [the insured is] unable to perform the substantial
and material duties of [his] regular occupation.”
MLI argues that this definition places the focus on the
condition that renders the insured unable to work. Deter-
mining coverage based on the disabling condition, it
argues, reflects the reasonable expectation of the parties.
When a “sickness” prevents the insured from working,
benefits for that disability are capped at age 65. MLI
asserts that Levy was not unable to work due to his 1987
sports injury or even his 1989 degenerative meniscus
tear. Rather, he became unable to work in 1996 due to
degenerative joint disease. Thus, because Levy’s disability
was caused by (“due to”) a “sickness,” not an “injury,” only
the policies’ sickness coverage applies.
Levy, however, claims that the phrase “due to” is ambig-
uous because it was left undefined by MLI. Because of this
ambiguity, Levy argues that we are required to adopt his
definition of “due to”—namely, “proximate cause.” It is
important to remember, however, that a term or phrase is
not ambiguous simply because it is undefined. Only when
a term is susceptible to more than one reasonable interpre-
tation is it ambiguous. The district court found that the
phrase “due to” was not ambiguous because, although
there were other possible interpretations (such
as “proximate cause”), only one interpretation (“immedi-
No. 07-1006 9

ate cause”) was reasonable when the policies were
viewed as a whole. For the moment, however, we will
assume that “due to” is ambiguous and construe it as
creating a proximate cause standard, as Levy advocates.
Illinois law defines “proximate cause” as “[any] cause
which, in natural or probable sequence, produced the
injury complained of. [It need not be the only cause, nor
the last or nearest cause. It is sufficient if it concurs with
some other cause acting at the same time, which in
combination with it, causes the injury.]” Illinois Pattern
Jury Instructions—Civil, No. 15.01 (2006 ed.). Thus, for
Levy to prevail, he must raise a genuine issue of fact as
to whether the 1987 basketball injury was a proximate
cause of his inability to perform his normal duties as
a physician. MLI argues that Levy falls short of meeting
this requirement. We agree.
Dr. Hallmann, the first medical profession to treat Levy
(almost 2 years after the injury), testified that the
meniscal tear he repaired in 1989 was not “fresh” or
“recent.” He opined that Levy “apparently injured his right
knee many years before” the surgery. Dr. Hallmann also
testified that he could not determine whether the degener-
ative meniscus tear noted in his report was the result of a
specific trauma or a degenerative process such as
osteoarthritis. Not insignificantly, as we previously
mentioned, Dr. Hallmann’s medical notes make no men-
tion at all of the 1987 basketball incident.
Dr. Waldram concurred with Dr. Hallmann’s testimony
that the degenerative changes predated the basketball
injury. He specifically opined that, based on his review of
the reports and testimony, Levy’s arthritis “is not in all
medical probability related to the injury of 1987.” Levy
argues that Dr. Waldram’s testimony is not competent
because he was retained by MLI and has no facts to
support his opinion. However, Dr. Waldram did not simply
10 No. 07-1006

speculate regarding the cause of Levy’s arthritis. Besides
reviewing reports and testimony, he also pointed to
medical evidence that Levy’s arthritis was not caused by
the 1987 basketball injury. For example, Dr. Waldram
testified that osteoarthritis typically presents unilat-
erally and asymmetrically, casting doubt upon Levy’s
contention that his right knee arthritis was caused by
a right knee injury.
Dr. Prodromos’ testimony was the most complex. On
cross-examination, he did opine that the basketball
injury caused the meniscal tear, which, in turn, caused
the arthritis.5 However, Dr. Prodromos’ subsequent
testimony emphasized that Levy’s inability to work was
not caused by a meniscal tear but osteoarthritis: “When
I saw him he wasn’t hurting because of a meniscal tear. It
was occurring because the meniscal tear had caused the
sequence of events of articular cartilage damage and
arthrosis and pain in his knee.” Consequently, Dr.
Prodromos described the link between Levy’s meniscal
tear and his arthritis as “indirect.”
Dr. Levy’s own testimony links the 1987 injury to his
disability. But he acknowledged that he lacks the appro-
priate medical expertise to diagnose or treat meniscal
tears such as the one he sought treatment for in 1989.
Furthermore, his previous statements refute his testi-
mony. On four occasions between 1992 and 1994, Levy
certified that he “ha[d] not suffered a disability, been
injured or sick” during those periods. In a 1994 application
for life insurance coverage with MLI, Levy also certified
that he had made a “Full Recovery” from his arthroscopic

5
It should be noted that Dr. Prodromos also testified that Levy
“went out of his way to tell me that [his disability] was caused
by an injury”—a fact Levy did not emphasize to his first orthope-
dic surgeon, Dr. Hallmann.
No. 07-1006 11

surgery and had experienced “no problems since.” In the
1996 claim he submitted to MLI, Levy stated that the
pain and limited motion in his knee that occurred at the
time of the 1987 injury persisted for only 2 or 3 weeks
and then subsided for several months until the pain
returned “with no apparent precipitating event.” Thus,
Levy presented scant evidence that his disabling condi-
tion had its roots in an isolated, 10-year-old, sports injury.
Even if we assume the 1987 basketball injury caused the
meniscal tear, the evidence is insufficient to show that
the injury proximately caused Levy’s disability. It is
critical that, after the 1989 surgery, Levy not only ad-
mitted to making a full recovery but continued to perform
his normal duties as a physician for 7 years, during which
time he never sought medical diagnosis or treatment for
his knee. Only when he developed osteoarthritis did he
become unable to work. Thus, even under a proximate
cause analysis, the alleged injury is too speculative and
remote. See W. Page Keeton, Prosser and Keeton on Torts
§ 41, at 264 (5th ed. 1984) (stating that proximate cause
recognizes that “legal responsibility must be limited to
those causes which are so closely connected with the
result and of such significance that the law is justified in
imposing liability”). The district court therefore did not
err in granting summary judgment in favor of MLI.
We emphasize that our decision today does not hold
that the phrase “due to” is ambiguous or that it usually
translates into a proximate cause standard. On the
contrary, the district court’s opinion persuasively argues
that “due to” is not ambiguous here because a proximate
cause standard would not have been reasonable when
viewing the policies as a whole. Specifically, Judge
Schenkier pointed out that, unlike the causation language
at issue in two Illinois cases involving accidental death and
dismemberment policies, Faulkner v. Allstate Life Insur-
ance Co., 684 N.E.2d 155 (Ill. App. Ct. 1997), and Carlson
12 No. 07-1006

v. New York Life Insurance Co., 222 N.E.2d 363 (Ill. App.
Ct. 1966),6 the phrase “due to” in our case not only deter-
mines the existence of coverage but also the duration of
coverage under the policies. The provisions contemplate
that an insured will be unable to work “due to” a sickness
or “due to” an injury, not both. Because a disability may
have more than one proximate cause, that standard would
be insufficient to delineate which provision applies. Thus,
Levy would face an uphill battle if it were necessary to
address whether “due to” was ambiguous to begin with.
For the foregoing reasons, summary judgment in favor
of the defendant is AFFIRMED.

6
The causation language involved in Faulkner and Carlson
differs from the language in our case. Neither party has pre-
sented Illinois authority interpreting the phrase “due to” as
creating a proximate cause standard—or any other causation
standard—in an insurance policy.

USCA-02-C-0072—2-25-08