Sims v. Great American Life Insurance

F IL E D
United States Court of Appeals
Tenth Circuit
PUBLISH
November 7, 2006
U N IT E D ST A T E S C O U R T O F A PP E A L S
Elisabeth A. Shumaker
Clerk of Court
T E N T H C IR C U IT

CLARA A. SIM S , an individual,

Plaintiff-Appellee ,
v. No. 04-5135
GREAT A M ERICA N LIFE
INSU RANCE COM PA NY , a Foreign
Insurance Com pany,

Defendant-Appellant .

A PPE A L FR O M T H E U N IT ED ST A T ES D IST R IC T C O U R T
FO R T H E N O R T H E R N D IST R IC T O F O K L A H O M A
(D .C . N O . C V -02-538-K )

David M . Gunn (Russell S. Post, Beck, Redden & Secrest, L.L.P., Houston,
Texas, and Timothy T. Trum p, Conner & W inters, P.C., Tulsa, Oklahom a with
him on the briefs), Beck, Redden & Secrest, L.L.P., Houston, Texas for
Appellant.

Steven L. A ndrew (D . K evin Ikenberry w ith him on the brief), A ndrew , W illiam s
& Ikenberry, A Professional Corporation, Tulsa Oklahoma, for Appellee .

Before H A R T Z , A N D ER SO N , and T Y M K O V IC H , Circuit Judges.

T Y M K O V IC H , Circuit Judge.
 Lawrence Sims died when the speeding car he was driving sailed off a rural

road. Prior to his untimely death, he had obtained life insurance from Great

American Life Insurance Company. Sims’s wife made a claim on this policy, but

after an investigation Great American denied the claim under its non-accidental

death provision concluding that Sims committed suicide. M rs. Sims then filed

suit against G reat American alleging breach of contract and bad faith for its

failure to pay her husband’s life insurance policy. A jury found the death was

accidental and awarded M rs. Sims $1.4 million in compensatory and punitive

damages. Great American argues on appeal that the district court made numerous

evidentiary and procedural errors when it precluded Great American from

introducing relevant evidence pertaining to the crash and Sims’s state of mind at

the time of his death.

This case requires us to consider the interplay between the Erie doctrine

and the Federal Rules of Evidence in diversity cases tried in federal district court.

The district court refused to adm it evidence that would have been inadm issible in

state court, concluding that state policy trum ps the Federal Rules of Evidence.

Although we conclude that the Erie doctrine does not govern the admissibility of

evidence under the Federal Rules, we find that the Rules still require diversity

courts to analyze substantive state policy in considering the admissibility of

evidence.

-2-
 Exercising jurisdiction under 28 U.S.C. § 1291, we REVERSE the district

court’s denial of judgment as a matter of law on both the bad faith and punitive

damages claims. W e otherwise AFFIRM .

I. Background

A . Law rence Sim s’s D eath

On September 3, 2001, Lawrence and Clara Sims attended a golf

tournament at their local country club. Sims became extremely intoxicated during

the course of the day. He was still quite intoxicated when the couple returned

home that evening to an unkempt kitchen. Over this seemingly minor issue, Sims

expressed unexpected agitation and anger in front of his wife and daughter. He

stormed out of the kitchen, jumped in his car, and sped away.

Concerned for her husband’s well-being, M rs. Sims immediately called

911. She told the 911 operator that Sims “was upset and that we were afraid that

he was going to get hurt or hurt himself.” R. at 807. By the next morning when

her husband had still failed to return home, M rs. Sims phoned family, friends, and

local hospitals to no avail. She then filed a missing persons report. In her sw orn

statement to the police, she described Sims’s state of mind on the evening of

September 3:

Drinking— but in a good mood. Got home around 9:00, got angry
because the house was a mess . . . Got angrier [and] angrier— slammed
dining room chair to floor [and] stormed out— saying he’s “out of here.”
M entioning driving off a cliff. Called 911 to let you know.

-3-
R. at 85. The official missing persons report, drafted by the police and signed by

M rs. Sims without her review, editorialized on this language, noting instead that

“M r. Sims was enraged over the cleanliness of their home . . . [and] may be

suicidal, because when he left his residence, M r. Sims mentioned something about

driving off a cliff.” R. at 84 (emphasis added).

Two days later police recovered Sims’s body. Based on evidence at the

accident scene, police surmised that his car had careened off the main road onto a

right-of-way toward a creek. The car, traveling at an excessively high rate of

speed, clipped a fence and then hit a bump that caused it to sail some 115 feet

over a creek bed, before landing in a pasture. No skid marks were visible at the

scene nor any other evidence suggesting that Sims swerved before clipping the

fence. Although Sims habitually wore his seat belt, on this occasion his seat belt

was not fastened. Post-mortem examination revealed a blood-alcohol content

(B AC) of 0.19% , well over the legal limit.

Despite M rs. Sims’s sworn police statement to the contrary, she has

steadfastly held in these proceedings that she intentionally lied about her

husband’s intent to drive off a cliff. This lie, she claims, was merely an effort to

encourage the police to act quickly to locate her missing husband. M rs. Sims

adamantly asserts that she never believed her husband was truly suicidal.

-4-
B . Life Insurance Investigation and D enial of C laim

In August 2000, Sims obtained a life insurance policy from Great American

in the amount of $300,000. This policy expressly excluded recovery for non-

accidental death. Following Sims’s death, M rs. Sims made a claim.

As w as its typical practice, Great American hired an independent claim

investigator, Broyles Claim Service Agency, to review the claim. Broyles

examined a number of documents as part of its investigation, including (1) the

missing persons report, (2) the accident report, (3) the medical examiner’s report,

(4) the death certificate, and (5) Sims’s medical and pharmaceutical records.

Additionally, Broyles conducted telephone interviews with the m edical examiner,

the investigating police officer, M rs. Sims, and M rs. Sims’s counsel.

Both the police department accident report and the county’s death

certificate listed suicide as the manner of death. The investigating officer and the

coroner relied heavily on the missing persons report in making their cause of

death determination. In preparing the accident report, for example, the

investigating officer reviewed the missing persons report as well as the physical

circumstances of the accident. But the officer conceded at trial that he had never

examined the car to determine if the brakes failed or showed other mechanical

deficiencies which could have caused a loss of control. Although the officer did

-5-
not know Sims’s BAC when he originally prepared the report, he was adamant

that he would still have listed suicide as the cause of death.

The medical examiner also attributed the death to suicide. However, the

medical examiner did not perform an autopsy to determine if Sims suffered a

stroke or exhibited symptoms of some other ailment that could have caused him to

lose consciousness or control of the vehicle. W hen asked by Broyles why he

ruled the death a suicide, the medical examiner replied “that if [Broyles had seen

the] missing persons report and the accident report, we would see the reason for

his [conclusion].” R. at 1764.

Broyles also obtained a recorded statement from M rs. Sims, with her

counsel present, and a separate statement from counsel as he had known Sims

from the country club. Unsurprisingly, both parties insisted that Sims did not

comm it suicide. W hile M rs. Sims did not explicitly recant her sworn police

statement until after filing this law suit, Broyles never asked why her sw orn

statement contradicted her statement to him. Nor did Broyles question M rs. Sims

regarding any possible motive Sims had to commit suicide. Broyles’s

investigation revealed that Sims’s medical and pharmaceutical records showed no

indication of mental depression.

Finally, M rs. Sims claims Broyles was aware that another officer involved

at the scene believed Sims’s crash was accidental. Broyles denies this charge.

-6-
But in any event, Broyles did not interview this officer or any other officer with

the exception of the investigating officer. Broyles never interviewed Sims’s

daughter, w ho saw him the night of the incident.

Based on this investigation, Broyles recommended that Great American

deny accidental life insurance coverage and pay the claim under the suicide

provision. Two agents of Great American reviewed this recommendation and

concurred, tendering a return of the policy premiums that had been paid to

date— $2,964.67.

C . Proceedings in D istrict C ourt

Following the denial of the insurance claim, M rs. Sims filed suit in federal

court, alleging both breach of contract and bad faith. The district court denied

Great American’s summary judgment motion on the bad faith claim and similarly

denied Great American’s motion for judgment as a matter of law at the close of

the trial. The jury awarded M rs. Sims $300,000 for the breach of contract claim,

$600,000 for the bad faith claim, and $500,000 in punitive damages. Following

the verdict, Great American renewed its motion for judgment as a matter of law

or, in the alternative, a new trial, which the district court rejected. Great

American’s timely appeal is now before this court.

II. A nalysis

-7-
 On appeal, Great American asserts that the district court comm itted

numerous errors, each constituting grounds for reversal:

(1) the court improperly excluded relevant evidence under
Oklahoma’s seat belt law that would have helped support the defense
theory that Sims was suicidal on the night of the crash;

(2) the court should have admitted evidence that the coroner and
investigating officer believed Sims’s death a suicide;

(3) the court erred in excluding evidence of Sims’s father’s suicide;

(4) the jury’s finding of bad faith and punitive damages was not
supported by sufficient evidence at trial; and

(5) the court should have permitted Great American’s accident
reconstruction expert to testify at trial. 1

A . Evidentiary C laim s

At the heart of Great American’s appeal is its argument that the Federal

Rules of Evidence govern questions of admissibility in federal diversity cases,

irrespective of the existence of conflicting state statutes. This argument rests on

the proposition that the doctrine set forth in Erie R.R. v. Tom pkins, 304 U.S. 64

(1938), is inapplicable to these Rules. Based on this premise, Great American

asserts that the district court improperly applied state law, as opposed to the

1
Great American also argued that one of the court’s jury instructions
improperly characterized bad faith as a negligent tort. At oral argument, Great
American conceded that the Oklahoma Supreme Court recently ruled to the
contrary and approvingly cited to the jury instruction used by the district court
below. See Badillo v. M id Century Ins. Co., 121 P.3d 1080, 1093 (Okla. 2005).
Accordingly, we need not address this argument.

-8-
Federal Rules of Evidence, to exclude (1) evidence showing Sims failed to wear

his seat belt on the night he died, as well as (2) reports and testimony from state

officials concerning Sims’s manner of death.

W e are persuaded that the Federal Rules of Evidence are not governed by

the Erie doctrine. Having said that, concepts of federalism still guide our

understanding of the interplay between the Federal Rules and state law. Although

we do not ground our holding in Erie, we conclude that state substantive policy

directs the admissibility of evidence under the relevancy considerations of Rule

401.

1. E rie and F ederal R ules of E vidence

This case presents us with a classic civil procedure question— in the face of

a conflicting state statute, w hen does a federal court sitting in diversity apply

federal law? This question, of course, invokes the Supreme Court’s seminal

decision in Erie Railroad v. Tom pkins and the landmark trilogy which followed.

See G uar. Trust Co. v. York, 326 U.S. 99 (1945) (creating the outcome

determination test); Byrd v. Blue Ridge Rural Elec. Coop., 356 U.S. 525 (1958)

(holding that the outcome determination test is not dispositive in the face of

countervailing federal interests); Hanna v. Plumer, 380 U.S. 460 (1965) (holding

Erie inapplicable to the Federal Rules of Civil Procedure). Collectively, the

“broad command” flowing from these cases requires federal courts “to apply state

-9-
substantive law and federal procedural law.” Hanna, 380 U.S. at 465. However,

the sw eep of this broad command is limited— only federal common law is

governed by the Erie doctrine; congressional acts and the Federal Constitution

fall outside its scope. As the Erie court famously stated:

Except in matters governed by the Federal C onstitution or by acts of
Congress, the law to be applied in any case is the law of the state
. . . . There is no federal general common law. Congress has no power
to declare substantive rules of common law applicable in a state
whether they be local in their nature or “general,” be they commercial
law or a part of the law of torts.

Erie, 304 U.S. at 78 (emphasis added). This seemingly sim ple rule, however, has

a surprisingly complex application when the federal rule at issue is one of the

Federal Rules of Evidence.

Great Am erican argues that the Federal Rules of Evidence are an “act of

Congress,” not federal com m on law, and therefore outside the purview of Erie.

Accordingly, when applying these Rules, Great Am erican continues, federal

diversity courts should not look to Erie but instead should apply the test

form ulated in Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22 (1988), which

governs the application of a federal statute to a diversity case. Following

Stewart, a court asks whether the evidentiary rule is both (1) “sufficiently broad

to control the issue before the Court,” and (2) “a valid exercise of Congress’

authority under the Constitution.” Id. To be a valid exercise of congressional

authority, the federal rule m ust be “capable of classification” as a procedural rule.

-10-
Id. at 32 (quoting Hanna, 380 U .S. at 472). If the rule satisfies both conditions,

absent other considerations, the federal evidentiary rule applies. See id. at 26

(noting that a “district court’s decision whether to apply a federal statute . . . in a

diversity action . . . involves a considerably less intricate analysis than that which

governs the ‘relatively unguided Erie choice’”) (quoting Hanna, 380 U.S. at 471).

A brief review of the origins of the Federal Rules of Evidence shows that

Stewart provides the starting point in determining the admissibility of evidence in

this case.

a. Origin of Federal Rules of Evidence

Great American’s argument rises or falls on the premise that the Federal

Rules of Evidence are a product of congressional action. Our review of the

relevant history reveals this to be so.

Prior to the enactment of the Federal Rules of Evidence, Federal Rule of

Civil Procedure 43(a) governed evidentiary matters in federal courts. 19 Charles

Alan W right, Arthur R. M iller & Edward H. Cooper, Federal Practice and

Procedure § 4512 (2d ed. 1996 & Supp. 2005) (“Federal Practice”). Under Rule

43, federal courts typically applied state evidentiary law to questions regarding

the admissibility of evidence. Id. (“[T]he norm was to follow forum state law on

evidentiary matters, not because Erie demanded it, but simply because the Civil

-11-
Rule so directed.”). But in 1972, the Supreme Court started drafting an

independent set of rules governing the admissibility of evidence in federal courts:

the Federal Rules of Evidence.

At the time the Supreme Court was considering the Rules of Evidence,

Congress passed a statute requiring congressional approval before the Court could

promulgate not only these Rules but also amendments that had been proposed in

1972 to the already promulgated Federal Rules of Civil and Criminal Procedure.

See Act of M arch 30, 1973, Pub. L. No. 93-12, 87 Stat. 9. Congress’s concern, in

large part, was based on a desire to protect substantive state law. 19 Federal

Practice § 4512. In this way, Congress became intricately involved in formulating

the Federal Rules of Evidence, and the Rules themselves became an act of

Congress. 2 See Act of Jan. 2, 1975, Pub. L. No. 93-595, 88 Stat. 1926.

Remembering that Erie limits its holding to federal common law and excepts

2
The Act of M arch 30, 1973 required congressional approval only for the
Supreme Court orders in late 1972. Those orders proposed the original Federal
Rules of Evidence as well as certain amendments to both the Federal Rules of
Civil Procedure and the Federal Rules of Criminal Procedure. Congress did not
extend this Act to apply to all future amendments of the Federal Rules. Instead,
under the current system, amendments are made pursuant to a process whereby the
Supreme Court approves a change to the Rules and notifies Congress of such
change. If Congress fails to act, the amended rule goes into effect. In short,
since 1975, amendments to the Federal Rules have not been promulgated by an act
of Congress. As discussed below, our analysis focuses on Rule 401. Because this
Rule has remained unamended since 1975, we need not analyze the effect of Erie
on evidentiary rules amended since that time.

-12-
congressional actions, this history makes clear that Erie does not apply to the

original Federal Rules of Evidence.

Nor can we find that Congress otherwise explicitly limited the applicability

of the Federal R ules of Evidence in the face of conflicting state law. Two

statutes normally limit the effect of evidentiary and procedural rules, the Rules

Enabling Act 3 and the Rules of Decision Act. 4 But these laws do not govern the

Federal Rules of Evidence as originally enacted. 19 Federal Practice § 4512; see

Flaminio v. Honda M otor Co., 733 F.2d 463, 470 (7th Cir. 1984). The Rules

Enabling Act proscribes the ability of the Supreme Court to alter substantive

rights. Here, with the original enactment of the Federal Rules of Evidence, it was

Congress, not the Supreme Court, creating the Rules. Under the Rules of

Decision Act, state law provides for the rule of decision in civil cases except

where Congress or the Constitution provides otherwise. Again, we are dealing

3
The Rules Enabling Act, granting the Supreme Court “the power to
prescribe general rules of practice and procedure and rules of evidence for cases
in” federal courts, simultaneously prohibits the Supreme Court from proscribing
any rule of procedure or practice for cases in the federal courts that shall
“abridge, enlarge or modify any substantive right.” 28 U.S.C. § 2072. This Act
has been used to limit the reach of the Federal Rules of Civil Procedure.
4
The Rules of Decision Act provides that state law, “except where the
Constitution or treaties of the U nited States or Acts of Congress otherw ise require
or provide, shall be regarded as rules of decision in civil actions” in the federal
courts. 28 U.S.C. § 1652.

-13-
with a congressional act. Put simply, there is nothing in these Acts that limits the

scope of the Federal Rules of Evidence as originally enacted. 5

In sum, because Erie does not apply to acts of Congress, the

substance/procedure dichotomy embodied in that doctrine is inapplicable to the

Federal Rules of Evidence as originally enacted. Further, because an act of

Congress is subject to neither the Rules Enabling Act nor the Rules of Decision

Act, these Acts do not work to limit the applicability of the unamended Federal

Rules of Evidence in the face of conflicting state law.

b. Federal Court Application of Erie Doctrine to Federal Rules of
Evidence

W e recognize that numerous federal diversity courts have grappled with

this tricky issue and reached an opposite conclusion. These courts, such as the

district court below, suggest we limit application of the Federal Rules of Evidence

to those matters not implicating substantive state policy. See, e.g., M cInnis v.

A.M .F., Inc., 765 F.2d 240, 245 (1st Cir. 1985); Szantay v. Beech Aircraft Corp.,

349 F.2d 60, 63 (4th Cir. 1965); Potts v. Benjamin, 882 F.2d 1320, 1324 (8th Cir.

1989); M oe v. Avions M arcel Dassault-Breguet Aviation, 727 F.2d 917, 930–33

(10th Cir. 1984). These courts falter, though, because they ground this limitation

5
Again, we note that a number of the Federal Rules of Evidence have been
amended since 1975. W e do not address how these amendments affect the reach
of either the Rules Enabling Act or the Rules of Decision Act.

-14-
in Erie and, as we have just discussed, Erie is inapplicable to the Federal Rules of

Evidence, a product of congressional action.

Under their approach, federal courts apply the Stewart analysis only if the

conflicting state evidentiary rule is procedural. If, however, the state evidentiary

rule is substantive, these courts have held that Erie controls and state law prevails

over conflicting federal evidentiary rules. State substantive rules, then, are

governed by an Erie analysis. Examples of substantive state evidentiary rules

where courts have applied Erie include such diverse topics as (1) the parol

evidence rule; (2) evidence concerning the amount of a plaintiff’s settlement with

other defendants; (3) findings of medical malpractice screening panels; (4) the

objective evidence requirement; (5) burden of proof rules; and (6) as we have

here, the failure to use seat belts. 17A James W m. M oore et al., M oore’s Federal

Practice ¶ 124.09 (3d ed. 2006).

Yet, as previously explained, this Erie approach turns Stewart on its head.

Stew art requires the court to look first at the federal evidentiary rule. If that rule

is arguably procedural, it governs even when a state substantive law is on point.

Simply put, because Erie is inapplicable, we must first look to the Federal Rules

of Evidence.

c. Tenth Circuit Approach

-15-
 Our precedent suggests that where a conflict exists between the Federal

Rules of Evidence and state law, we apply the Federal Rules unless the state law

reflects substantive concerns or policies.

The admissibility of evidence in diversity cases in federal court is
generally governed by federal law. Nevertheless, it is well recognized
that Congress did not intend the procedural rules to preempt the
so-called substantive state rules of evidence, such as the parol evidence
rule, the collateral source rule, or the statute of frauds; although the
application of these rules will affect the admissibility of some evidence,
they in reality serve substantive state policies regulating private
transactions.

M acsenti v. Becker, 237 F.3d 1223, 1241 (10th Cir. 2001) (quotations omitted);

see Romine v. Parman, 831 F.2d 944, 944–45 (10th Cir. 1987) (noting that while

“admissibility of evidence in diversity cases in federal court is generally governed

by federal law,” state law must be applied w hen “an evidentiary question is so

dependent on a state substantive policy”).

In our most noteworthy and extensive discussion of this issue, M oe v.

Avions M arcel Dassault-Breguet Aviation, 727 F.2d 917, 930–33 (10th Cir. 1984),

we addressed the applicability of the Federal Rule of Evidence governing

subsequent remedial measures. W e held that state law rather than Rule 407

prevails, thus rejecting the notion that the “admissibility of evidence in diversity

actions is governed exclusively by federal law— that is, the Federal Rules of

Evidence.” Id. at 931. W e employed instead an Erie analysis and categorized the

-16-
state law as one of substance, not procedure. In doing so, we stated such

distinction was necessary to effect the twin goals of Erie— (1) uniformity, and

(2) prevention of forum-shopping. Id. at 932. W e concluded,

If the law of the state supplies the rule of decision, there is no
justification for reliance on Rule 407. We recognize that, by its terms,
Rule 407, when read in conjunction with Rules 401 and 402, does
appear to apply in these cases. However, such a result is an
unwarranted incursion into the Erie doctrine.

Id.

W e are careful to point out, however, that the court’s discussion regarding

the application of the Federal Rules of Evidence was dicta. As the court

observed: “Notwithstanding our view that the trial court erred in ruling that . . .

Rule 407 applies in diversity actions without regard to state law, we hold that no

harm resulted therefrom because the trial court’s actions were proper and correct

on other grounds.” Id. at 933. Indeed, one judge in a concurring opinion refused

to join the court’s Erie discussion, stating,

I concur in [the] result and in the opinion of the court except to the
extent that it purports to resolve the difficult question of possible
conflict between state and federal rules of evidence. As the court’s
opinion makes clear, that discussion is not necessary to our decision
which properly rests on the independent ground of balancing mandated
by Rule 403 and parallel state authority.

Id. at 936 (M cK ay, J., concurring).

d. Effect of Rule 401

-17-
 Although the M oe court’s reasoning is tempting, we are persuaded that Erie

is inapplicable to the Federal Rules of Evidence. W e recognize, of course, that a

federal court’s apparently unchecked ability to apply the Federal Rules of

Evidence without any regard for state substantive policy creates considerable

tension with notions of federalism. But this tension is overstated. Congress did

not give federal courts unbridled discretion to preempt state substantive law on all

arguably procedural matters. Instead, the Rules of Evidence expressly provide for

the application of state law in numerous circumstances. See Fed. R. Evid. 302

(presumptions); id. 501 (privileges); id. 601 (competency of witnesses).

M ost pertinent to this case, Rule 401 protects against incursion into state

substantive policy as part of its admissibility assessment. 6 Rule 401 defines

relevant evidence as “evidence having any tendency to make the existence of any

fact that is of consequence to the determination of the action more probable or

less probable than it w ould be without the evidence.” (emphasis added).

This definition requires a dual inquiry: (1) w hether the evidence is

probative or factually relevant to the proposition asserted (i.e., whether the

evidence tends to make the existence of that fact more or less probable), and

6
Rule 401 has not been amended since the Federal Rules of Evidence were
originally enacted. Accordingly, it is clearly the result of an Act of C ongress.

-18-
(2) whether the proposition for which the evidence is offered is properly provable

in the case (i.e., the fact is material— of consequence— to the question of state

law ). 7 19 Federal Practice § 4512; see Fed. R. Evid. 401 advisory committee’s

notes (“Relevancy is not an inherent characteristic of any item of evidence but

exists only as a relation between an item of evidence and a matter properly

provable in the case.”); Olin Guy W ellborn III, The Federal Rules of Evidence

and the Application of State Law in the Federal Courts, 55 Tex. L. Rev. 371,

388–89 (1977). The first inquiry is a procedural question of evidence law and the

second is a substantive question regarding the materiality of the evidence.

W ellborn, supra, at 389; see Telum, Inc. v. E.F. Hutton Credit Corp., 859 F.2d

835, 838 (10th Cir. 1988) (“Substantive law . . . determines which facts are of

consequence in a given action.”).

Under the second inquiry, a fact may be “of consequence” to the

determination only if it is “the kind of fact to which proof may properly be

directed.” Fed. R. Evid. 401 advisory committee’s notes; W ellborn, supra, at

406.

7
W e are careful in our use of the term “material.” In the past, this
terminology was used to describe facts that were of consequence to the relevancy
determination. However, this term is now viewed with disfavor. The drafters of
the current Rules use “the phrase ‘fact that is of consequence to the determination
of the action’ to describe the kind of fact to which proof may properly be
directed” because “it has the advantage of avoiding the loosely used and
ambiguous word ‘material.’” Fed. R. Evid. 401 advisory committee’s notes.

-19-
 W here a state law excludes certain evidence in order to effect substantive

policy considerations, Rule 401 acts to exclude the evidence since the proposition

for which the evidence is submitted is not properly provable and, therefore,

irrelevant to the claim. 8 See Huff v. Shumate, 360 F. Supp. 2d 1197 (D. W yo.

2004) (holding that although the Federal Rules of Evidence apply, the Rules

nonetheless bow to state substantive policy based on the relevancy requirement of

Rules 401 and 402); see also Jack B. W einstein & M argaret A. Berger,

Weinstein’s Federal Evidence, § 401.04[3][b] (Joseph M . M cLaughlin ed. 2006).

For example, state law defines the elements and defenses of a cause of action in a

diversity case. If, in such a case, a defendant proffers evidence supporting a

defense that is no longer permitted by state statute, that proffer is of no

consequence to the action and therefore not properly provable.

In sum, although we find that the Federal Rules of Evidence are not subject

to Erie’s substance/procedure distinction, this distinction still has meaning in

making evidentiary determinations in federal diversity cases.

e. Substance versus Procedure

8
W e would be presented with a different case where state law admits
certain evidence, but a Federal Rule of Evidence directly on point excludes the
same evidence. In such a case the Federal Rule likely controls. This is because
Federal Rule of Evidence 402 states: “All relevant evidence is admissible, except
as otherwise provided by the Constitution of the United States, by Act of
Congress, by these rules, or by other rules prescribed by the Supreme Court
pursuant to statutory authority.” (emphasis added).

-20-
 The distinction between state substantive and procedural law has proven

elusive, largely because many state rules generally reflect a mix of substantive

and procedural concerns. See D. M ichael Risinger, “Substance” and

“Procedure” Revisited w ith Som e Afterthoughts on the Constitutional Problems

of “Irrebuttable Presumptions,” 30 UCLA L. Rev. 189, 190 (1982) (noting that

“the closest thing there is to a developed school of thought concerning the

m eaning of the procedure-substance dichotom y is really an abdication of analysis,

wilfully em braced.”). N onetheless, som e fundam ental elem ents consistently

define the substance-procedure dichotom y.

“A pure rule of evidence . . . is concerned solely with accuracy and

economy in litigation . . . .” Barron v. Ford M otor Co., 965 F.2d 195, 199 (7th

Cir. 1992). Such rules “are addressed to lawyers and judges in their professional

roles and govern the means by which disputes regarding the content or application

of substantive rules should be resolved. The purpose of these rules is to achieve

accuracy, efficiency, and fair play in litigation, without regard to the substantive

interests of the parties.” M ichael Lewis W ells, The Impact of Substantive

Interests on the Law of Federal Courts, 30 W m . & M ary L. Rev. 499, 504 (1989).

As John Hart Ely observed,

[A] procedural rule is . . . one designed to m ake the process of litigation
a fair and efficient m echanism for the resolution of disputes. Thus, one
way of doing things may be chosen over another because it is thought
to be more likely to get at the truth, or better calculated to give the
parties a fair opportunity to present their sides of the story, or because,

-21-
 and this m ay point quite the other way, it is a means of prom oting the
efficiency of the process.

John Hart Ely, The Irrepressible M yth of Erie, 87 Harv. L. Rev. 693, 724–25

(1974).

In contrast, “a substantive rule is concerned with the channeling of

behavior outside the courtroom .” Barron, 965 F.2d at 199. Substantive rules “are

directed at individuals and governm ents and tell them to do or abstain from

certain conduct on pain of som e sanction. Substantive rules are based on

legislative and judicial assessm ents of the society’s wants and needs, and they

help to shape the world of prim ary activity outside the courtroom .” W ells, supra,

at 504. Ely elaborates upon this idea:

The most helpful way . . . of defining a substantive rule . . . is as a right
granted for one or m ore nonprocedural reasons, for som e purpose or
purposes not having to do with the fairness or efficiency of the
litigation process. Thus, in attempting to give content to the notion of
substance, the literature has focused on those rules of law which
characteristically and reasonably affect people’s conduct at the stage of
prim ary private activity.

Ely, supra, at 725 (internal citations and quotations om itted). 9

9
Ely went on to note the state goals these policies serve:

[W ]e probably should give “conduct” a coverage som ewhat broader
than that the term m ost naturally suggests, to include along with the
encouragem ent of actual activity the fostering and protection of certain
states of m ind— for example, the feeling of release, the assurance that
the possibility of ordeal has passed, that a state seeks to create by
enacting a statute of limitations. Beyond that, we surely would want to
(continued...)

-22-
 In short, although the distinction between substance and procedure is not

always clear, we can distinguish a substantive rule from a procedural rule by

examining the language and the policy of the rule in question. If these inquiries

point to achieving fair, accurate, and efficient resolutions of disputes, the rule is

procedural. If, however, the prim ary objective is directed to influencing conduct

through legal incentives, the rule is substantive.

f. Summary

The Federal Rules of Evidence are an act of Congress and, thus, subject

neither to the dictates of the Erie doctrine nor to the Rules Enabling Act or Rules

of Decision Act. Yet, we are mindful that Erie “recognized that the scheme of

our Constitution envisions an allocation of law -making functions between state

and federal legislative processes which is undercut if the federal judiciary can

make substantive law affecting state affairs beyond the bounds of congressional

legislative powers.” Hanna, 380 U.S. at 474–75 (H arlan, J. concurring).

9
(...continued)
count as substantive various sorts of im m unizing law s . . . which surely
are not calculated to encourage those im m unized to engage in the
conduct involved, conduct for which the rest of us would be liable.
They are, instead, based upon a judgm ent that although the conduct
involved is undesirable and indeed ought to be deterred, other and, in
context, m ore im portant goals w ill be served by im m unization from
liability.

Ely, supra, at 726.

-23-
 But we also recognize that Congress may “prescribe housekeeping rules for

federal courts even though some of those rules will inevitably differ from

comparable state rules.” Id. at 473. This is not to say, however, that Congress

has done so in a manner that disrespects “one of the modern cornerstones of our

federalism.” Id. at 474 (Harlan, J. concurring). Although Erie does not apply, its

reasoning remains instructive. In formulating Rule 401, Congress maintained the

delicate balance between the state and federal systems. W e keep with that goal:

a fact may be “of consequence” in a diversity action only if substantive state

policy so allow s.

W ith this analysis behind us, we now address the district court’s exclusion

of evidence regarding Sims’s failure to use his seat belt and testimony from state

officials concerning Sims’s manner of death. In doing so, the first question we

resolve is w hether, under Rule 401, the evidence offered is “of consequence” to

the action. This inquiry necessarily requires us to consider if the state law

excluding this evidence reflects substantive policy considerations.

2. A dm issibility of Seat B elt E vidence

Great American’s principal evidentiary argument on appeal is that it should

have been permitted to offer evidence showing Sims did not fasten his seat belt

on the night he died.

-24-
 The district court relied on Oklahoma’s M andatory Seat Belt Act to exclude

this evidence. See Okla. Stat. tit. 47, § 12-420 (barring evidence of the use or

non-use of a seatbelt in any civil suit). The court reasoned that in a diversity

action, although the admissibility of evidence is generally governed by the

Federal Rules of Evidence, when the “evidentiary question is so dependent on

state substantive policy, state law must be applied.” R. at 467 (quoting Romine v.

Parman, 831 F.2d 944 (10th Cir. 1987)). Great Am erican contends this logic is

flawed for two independent reasons: (1) because the Federal Rules of Evidence

govern, this evidence is admissible, and (2) even if the Rules are not applicable,

the statute does not apply where a defendant is not attem pting to insinuate fault

but, as here, is only attempting to prove a driver’s state of m ind.

Although we hold that the Rules exclusively govern in federal diversity

cases, we still must determ ine, in accordance with our Rule 401 relevancy

assessment, whether § 12-420 is a procedural rule or a substantive one. Because

this determ ination necessarily involves interpretation of O klahom a law , we apply

the most recent pronouncement of the Oklahoma Supreme Court. If, however, the

Oklahoma Supreme Court has not yet spoken on the issue, we predict how that

court would address the issue. Blackhawk-Central City Sanitation Dist. v. Am.

Guar. & Liab. Ins. Co., 214 F.3d 1183, 1188 (10th Cir. 2000). W e review de

novo the district court’s interpretation of O klahom a law. Burton v. R.J. Reynolds

Tobacco Co., 397 F.3d 906, 910 (10th Cir. 2005).

-25-
 a. M andatory Seat Belt Act

Oklahom a enacted its M andatory Seat Belt Act to encourage seat belt use

on the roads of O klahom a. See Bishop v. Takata Corp., 12 P.3d 459, 464 (Okla.

2000) (noting that “the obvious purpose[] of the Act [is] to codify public policy

of encouraging seat belt use”); see generally §§ 12-416 to 420. To this effect, the

Act requires drivers and front-seat passengers to fasten their seat belts. However,

the Act is careful to lim it the civil court ramifications for failure to wear a seat

belt, directing that evidence of the use or non-use of seat belts is inadm issible “in

any civil suit in Oklahom a.” Okla. Stat. tit. 47, § 12-420.

Even though the Oklahoma Supreme Court has not squarely addressed

whether § 12-420 is a substantive rule, a careful review of decisions from that

court persuades us that it is. 1 0 In Bishop v. Takata Corp., the court described the

purpose and scope of the A ct in holding it inapplicable to products liability cases:

Considering the Act as a whole, and the context from which it was
enacted, the obvious purposes of the Act are to codify public policy of
encouraging seat belt use and to m ake seat belt use mandatory for
drivers and front-seat passengers by providing a penalty for nonuse.
Section 12-420 expressly clarifies that the sole legal sanction for the

10
Numerous courts agree that a state statute excluding evidence of seat belt
use or non-use is substantive, not procedural, law. See, e.g., Dillinger v.
Caterpillar, Inc., 959 F.2d 430, 435 n.11 (3d Cir. 1992) (Pennsylvania); Sours v.
Gen. M otors Corp., 717 F.2d 1511, 1519 (6th Cir. 1983) (Ohio); Barron, 965 F.2d
at 199 (North Carolina); Potts v. Benjamin, 882 F.2d 1320, 1324 (8th Cir. 1989)
(Arkansas); Pasternak v. Achorn, 680 F. Supp. 447, 449 (D. M e. 1988) (M aine);
M ilbrand v. DaimlerChrysler Corp., 105 F. Supp. 2d 601, 604 (E.D. Tex. 2000)
(Texas).

-26-
 failure to wear a seat belt is the fine imposed by the Act and that a
person will not be penalized in a civil proceeding, by connotations of
fault, for choosing to refrain from wearing a seat belt. To read the
statute any m ore broadly would defeat the legislative intent. The entire
Act is confined to the regulation of the conduct of the driver or the
passenger of a passenger vehicle as seat belt users or nonusers.

12 P.3d at 464 (emphasis added). A few years later, the court in Clark v. M azda

M otor Corp., 68 P.3d 207, 208 (Okla. 2003), further clarified the scope of the

Act, stating that the public policy encouraging seat belt use “protects persons in

civil proceedings from connotations of fault.”

W hile not completely clear, the language in Bishop and Clark suggests that

§ 12-420 reflects substantive state policy to the extent that drivers and passengers,

while required by law to wear their seat belts, should not be penalized, through

connotations of fault, beyond a small statutory fine. 1 1 The rule is not concerned

with how seat-belt evidence might affect the accurate resolution of litigated

disputes. Nor is it concerned with the efficient resolution of disputes. To the

contrary, the rule was designed to protect drivers from being blamed in a court of

law for failure to wear a seat belt. Cf. Barron, 965 F.2d at 199 (A state law that

11
In his concurring opinion in Clark, Justice Opala stated that the court’s
decision in Bishop “militates strongly in favor of an opposite view.” 68 P.3d at
210. W hile this statement certainly bears on our analysis, we do not think it
changes our conclusion. In both Bishop and Clark, the court held that § 12-420
does not bar the admission of evidence of the use or non-use of a seat belt in a
products liability case. The court never specifically resolved whether the law
reflects substantive state policy to the extent that it precludes such evidence in a
negligence case.

-27-
bars admission of seat belt evidence “is a rule of evidence if it is motivated by

concern that jurors attach too much weight to a plaintiff’s failure to wear his

seatbelt [but] is a substantive rule if it is designed not to penalize persons who

fail to fasten their seatbelts.”).

A negligence action arising from a car accident illustrates how § 12-420

acts to avoid penalizing litigants with connotations of fault. In this scenario, a

driver not wearing his seat belt is injured in a car accident caused by another

vehicle. The injured driver sues. At trial, the defendant wants to argue that had

the plaintiff been wearing a seat belt, plaintiff’s injuries would have been

minimized and, accordingly, plaintiff’s recovery should be reduced. Section

12-420 clearly precludes this argument.

W e are not presented with such a case here. Instead, Great American, the

defendant, wishes to present evidence of non-use of a seat belt as proof of Sims’s,

the driver’s, suicidal intent. Section 12-420 was not created to apply to such

facts. The Oklahoma Supreme Court currently limits the application of

§ 12-420 to negligence cases. See Bishop, 12 P.3d at 466 (noting that the

Oklahoma Supreme Court held that the Act clearly “precludes the introduction of

evidence of the use or nonuse of seat belts to support a claim of negligence in a

wrongful death action . . . .”) (citing Comer v. Preferred Risk M ut. Ins. Co., 991

P.2d 1006, 1008 (Okla. 1999)); Clark, 68 P.3d at 208 (Okla. 2003) (“Section

-28-
12-420 . . . prohibits introduction of [evidence of the use or non-use of seat belts]

to impute negligence or fault to a person who elects not to wear a seat belt.”).

That is not to say that the court might not later expand its application, but

the court has indicated a preference to limit the Act to disputes where the conduct

of the driver is at issue. See Bishop, 12 P.3d at 464 (noting that the Act “is

confined to the regulation of the conduct of the driver.”). For that reason, a

number of Oklahoma decisions find the Act inapplicable in cases involving

products liability. Clark, 68 P.3d at 210 (Opala, J. concurring); Bishop, 12 P.3d

at 466.

Great American does not argue that Sims was negligent for failing to wear

his seat belt or otherwise insinuate fault for this omission. It argues he was

suicidal. Whether a mandatory seat belt law exists in Oklahoma is irrelevant to

this argument. In a negligence case, the existence of a seat belt law could be

critical to a damages assessment because it imparts a duty on the injured party to

wear a seat belt. See, e.g., Gardner ex rel. Gardner v. Chrysler Corp., 89 F.3d

729, 733 (10th Cir. 1996) (noting that the Kansas legislature modified earlier law

in order to clarify the extent of the duty owed under a mandatory seat belt law ).

But here duty is not an element of the claim. Great American frankly is

unconcerned whether Sims could have avoided his injuries had he been wearing

his seat belt. Great American is only concerned with how his failure to w ear a

-29-
seat belt reflects on his mental state. In this sense, the evidence does not speak to

the conduct of the driver but instead to the driver’s state of mind.

Because Great American introduced this evidence for purposes of showing

Sims’s state of mind, not to insinuate fault, we hold that Oklahoma’s M andatory

Seat Belt Act is inapplicable to the present case, and the district court should have

admitted this evidence at trial. Cf. Barron, 965 F.2d at 198–200 (holding that

North Carolina’s seat belt exclusionary rule, w hile a substantive law , is

inapplicable to the present case because the use of evidence “was not to show that

[Plaintiff] failed to mitigate the consequences of the accident but to show that

[D efendant] had been reasonable”).

Having concluded the seat belt evidence was admissible, we turn to what

effect the court’s preclusion of this evidence had at trial.

b. Harmless Error

Although we find error here, reversal is not appropriate unless the error

prejudicially affected a substantial right of a party or if we reasonably conclude

that the exclusion of this evidence led the jury to reach a contrary result.

Praseuth v. Rubbermaid, Inc., 406 F.3d 1245, 1253 (10th Cir. 2005); see Fed. R.

Civ. P. 61. W e look to “the particular jury in the particular circumstances of the

trial.” United States v. Hedgepeth, 418 F.3d 411, 421 (4th Cir. 2005) (quotation

omitted); see also United States v. Crawford, 130 F.3d 1321, 1324 (8th Cir.

-30-
1997). Put another way, after reviewing the entire record, we must reverse unless

we find that this jury’s verdict more probably than not was unaffected by the

error. Obrey v. Johnson, 400 F.3d 691, 699–701 (9th Cir. 2005); see Mehojah v.

Drummond, 56 F.3d 1213, 1215 (10th Cir. 1995) (requiring review of entire

record). W e note that an “important factor in determining whether an error was

harmless is the strength of the case in support of the verdict . . . . The risk is

greater that a particular error tipped the scales in a close case than in one in which

the evidence was extremely one-sided.” 1 2 11 Charles Alan W right, Arthur R.

M iller & Edward H. Cooper, Federal Practice and Procedure § 2883 (2d ed. 1995

& Supp. 2005).

Here, Great American planned to offer testimony that Sims habitually wore

his seat belt but failed to do so on the night he died. 1 3 W e agree this evidence is

probative of Sims’s state of mind. W hile the jury surely could have found Sims

failed to buckle up, not because he was suicidal but because he was intoxicated,

the very nature of habit evidence is that it is done reflexively. Habit “is the

person’s regular practice of meeting a particular kind of situation with a specific

12
Admittedly, this “principle . . . has greater application in criminal cases
. . . than it does in a civil case” since civil cases only go to the jury “if
reasonable people could reach different conclusions as to the outcome.” 11
Charles Alan W right, Arthur R. M iller & Edward H. Cooper, Federal Practice and
Procedure § 2883 (2d ed. 1995 & Supp. 2005).
13
Great American proffered that M rs. Sims, if called to testify, would state
that Sims habitually wore his seat belt.

-31-
type of conduct.” Fed. R. Evid. 406 advisory committee’s notes (quotation

omitted); accord United States v. Serrata, 425 F.3d 886, 906 (10th Cir. 2005).

Accordingly, the jury might have weighed this habit evidence along with the lack

of skid marks at the scene, the car’s high rate of speed, and Sims’s alleged

mention of driving off a cliff, and found Sims intended to commit suicide.

W e nonetheless find the exclusion harmless. At trial, Great American had

the burden of proving Sims committed suicide and it, along w ith M rs. Sims,

presented extensive evidence on this issue. Indeed, this issue was the crux of the

case. Great American offered testimony that Sims was traveling at an excessive

rate of speed, testimony that he did not attempt to avoid the accident, testimony

from M rs. Sims’s daughter that Sims left the house crying, and M rs. Sims’s sworn

statement to police that Sims intended to drive off a cliff. Yet, the jury

unequivocally rejected Great American’s characterization of the evidence when it

not only found for M rs. Sims on the breach of contract claim but also on the bad

faith and punitive damages claims. It is fair to say that if the question had been

close, the jury would not have awarded both bad faith and punitive damages.

-32-
 Therefore, we cannot reasonably conclude that the seat belt evidence, by

itself, would have led the jury to find in favor of Great American on the breach of

contract claim. 1 4

3. A dm issibility of E vidence from State O fficials

Great American next asserts the district court improperly limited the jury’s

consideration of evidence offered to refute the breach of contract claim: (1) the

medical examiner’s report, (2) the death certificate, (3) the accident report, and

(4) statements made by the investigating officer concerning Sims’s manner of

death. 1 5 The court erred, Great American argues, in applying

14
As to the bad faith and punitive damages claims, Great American has
raised sufficiency arguments. Because we reverse both these claims on
sufficiency grounds, any further harmless error analysis is unnecessary. See infra
Part II.B.
15
The jury instruction reads:

The court has permitted you to consider evidence that is normally not
admissible in a breach of contract claim. That evidence includes the Oklahoma
Official Accident Report, the R eport of Investigation by the M edical Examiner,
the Death Certificate, and statements made by investigating officers concerning
the speed of the vehicle and cause of Lawrence Sims’ accident and death. The
only portions of this evidence you may rely upon in considering the breach of
contract claim are the factual observations and the measurements personally made
by the officers.
The Oklahoma O fficial Accident Report, the Report of Investigation by the
M edical Examiner, the Death Certificate, and statements made by investigating
officers concerning the speed of the vehicle and cause of Lawrence Sims’
accident and death are inadmissible as to the breach of contract claim for two
reasons. First, this evidence is inadmissible because the evidence includes
conclusions as to M r. Sims’ cause of death that the officers are not qualified to
(continued...)

-33-
Oklahoma law rather than the Federal Rules of Evidence. As w ith the seat belt

evidence, this claim requires us to determine whether the evidence is of

consequence under Rule 401, or stated differently, whether the Oklahoma law at

issue reflects substantive state policy.

a. Expert Reports

W e begin with an examination of the two expert reports: the medical

examiner’s report and the death certificate. Pursuant to Oklahoma law, such

15
(...continued)
make. These conclusions would require the investigating officers to know M r.
Sims’ state of mind, which they could not know. Second, it is inadmissible
because the evidence comes from officials, or is in an official document, which
might cause you to believe that it is accurate or unquestionable. The Court does
not regard this evidence as conclusive on the cause of death of M r. Sims and nor
should you.
The only reason you are allowed to consider this evidence is because Great
American Life Insurance Company claims it reasonably relied on this information
in paying Plaintiff’s claim under the suicide provision of the policy. You may
only consider this evidence in determining whether G reat American Life
Insurance Com pany acted in good faith in investigating, evaluating, and paying
Plaintiff’s claim. You may not consider it as to Plaintiff’s breach of contract
claim .
You must make your own independent determination as to whether Great
American Life Insurance Company has met its burden of proving that M r. Sims
comm itted suicide. In making this determination, you may not consider the
Oklahoma O fficial Accident Report, the Report of Investigation by the M edical
Examiner, the D eath Certificate, and statements made by investigating officers
concerning the speed of the vehicle and cause of Lawrence Sims’ accident and
death. Defendant cannot meet its burden to prove M r. Sims committed suicide
through this evidence.

R. at 322–23 (emphasis added).

-34-
reports generally are excluded either as hearsay or improper opinion testimony.

See Travelers Protective Ass’n v. M ansell, 540 P.2d 1178, 1180 (Okla. 1975)

(excluding death certificate as hearsay); Fed. Life Ins. Co. v. M aples, 228 P.2d

363 (O kla. 1951) (excluding proof of death as hearsay and conclusion); N.Y. Life

Ins. Co. v. Gibbs, 56 P.2d 1179, 1180 (Okla. 1936) (excluding verdict of

coroner’s jury as hearsay); M etro. Life Ins. Co. v. Plunkett, 264 P. 827, 828 (Okla.

1928) (excluding statement by attending physician in proof of death and death

certificate as hearsay); Okla. Aid Ass’n v. Thom as, 256 P. 719, 721–22 (Okla.

1927) (excluding death certificate as hearsay).

In holding these types of records inadmissible for the purpose of showing

suicide, the Oklahoma Supreme Court has stated,

It is our opinion that the L egislature provided for the keeping of vital
statistics . . . for the purpose of keeping an accurate record of births and
deaths and of the diseases causing death, and so that the health
authorities may be better enabled to combat diseases. The attending
physician or coroner might be able to state the cause of death, just as
was stated here, gunshot wound. But to go further and state by whom
inflicted w ould change all the rules of evidence in cases in which this
certificate could be admitted.

Thom as, 256 P. at 721–22 (emphasis added). The court was clearly troubled that

a jury in such circumstances could be influenced by hearsay testimony. See id. at

721 (noting that admitting such testimony would “permit hearsay evidence”).

Indeed, the court later reiterated: “To know . . . how the deceased received the

injury that caused his death would require the testimony of an eyewitness, because

-35-
the injury was of the type which could have been incurred either accidentally or

intentionally.” M aples, 228 P.2d at 367. Therefore, evidence as to cause of death

is “inadmissible for the reason that they [are] based on hearsay and conclusion.”

Id.

Based on this precedent, we are persuaded that Oklahoma law barring such

testimony reflects a procedural rule. The court’s objective in precluding such

evidence is to promote accuracy in its courtrooms. See Thomas, 256 P. at 721

(noting that the case illustrates “the danger of permitting [a] death certificate to

be introduced to make out a prima facie case of suicide.”). Therefore, because

the state rules are procedural under Federal Rule of Evidence 401, the district

court should not have relied on state law in conducting its admissibility

determination.

Nevertheless, we find no error in the exclusion of these reports. Under

Rule 702, reports from experts, such as a m edical exam iner, are adm issible only if

necessary to aid in the interpretation of scientific, technical, or other specialized

facts. Although any witness m ay offer an opinion as to an ultim ate issue to be

decided by a jury, this opinion should not unduly invade the province of the jury

when the assistance of the witness is unnecessary. See United States v. Dazey,

403 F.3d 1147, 1172 (10th Cir. 2005); see Fed. R. Evid. 704 advisory com m ittee’s

notes (“Under Rules 701 and 702, opinions m ust be helpful to the trier of fact,

-36-
and Rule 403 provides for exclusion of evidence which wastes tim e. These

provisions afford ample assurances against the admission of opinions which

would m erely tell the jury what result to reach, som ewhat in the manner of the

oath-helpers of an earlier day.”).

Here, the jury was fully capable of assessing the facts to determine

causation. The experts did not offer any opinion that was based on scientific or

technical facts outside the jurors’ comm on knowledge or experience. To the

contrary, this is the very type of fact determination a jury is equipped to make.

Accordingly, although the district court incorrectly applied state law , the court’s

analysis nonetheless conforms to the appropriate analysis under Federal Rule of

Evidence 702, which would have limited the admissibility of the medical

examiner’s report and the death certificate.

b. Evidence from Investigating Officer

The district court also limited the investigating officer’s accident report as

well as his testimony relating to Sims’s cause of death. 1 6 The court relied on

16
Great American did not appeal the portion of the limiting instruction
concerning the investigating officer’s statement as to the speed of the vehicle.
Even if we could read their appeal broadly to cover this issue, Great American
admitted that the speed testimony was being offered only as evidence of Great
American’s lack of bad faith. In pretrial conference, Great American argued, “Is
[the speed evidence] being offered for the truth of the matter as to w hether [Sims]
was going 115 miles an hour; . . . No, it’s being offered based on the good faith
issue as to what Great American relied upon. And whether that information is
(continued...)

-37-
Gabus v. Harvey, 678 P.2d 253, 257 (Okla. 1984), to exclude this evidence. In

that case, the court emphasized the capability of the jury in assessing certain

facts:

[The evidence] concerned facts that could be readily appreciated by
any person who drives an automobile or crosses streets. N o special
skill or know ledge w as needed to understand these facts and draw a
conclusion from them. In such a case as this, where the normal
experiences and qualifications of laymen jurors permit them to draw
proper conclusions from the facts and circumstances, expert
conclusions or opinions are inadmissible. The expert conclusion here
w as not helpful and should not have been admitted . . . . It w as not
useful since the jury was just as capable of drawing a proper
conclusion from those facts as was the officer.

Id. at 256–57; see Maben v. Lee, 260 P.2d 1064 (Okla. 1953) (holding that an

investigating officer without personal knowledge cannot offer an opinion as to

causation at trial when the jury is as capable of doing so as is the officer); see

also Diaz v. State, 728 P.2d 503, 514 (Okla. Crim. App. 1986) (“It is only where

the fact of death and its cause is beyond the understanding of the average layman

that expert testimony may be necessary.”) (quotation omitted).

Based on this language, we believe that the Oklahoma rule precluding a

police officer’s opinion about causation is a procedural rule concerned solely with

accuracy and economy in the courtroom. Therefore, the district court should not

16
(...continued)
true or not, Great American relied upon it. And that shows good faith, not bad
faith, and it’s relevant to that issue.” R. at 517.

-38-
have grounded its conclusion in Oklahoma procedural law , but instead should

have relied exclusively on the appropriate Federal Rule of Evidence to guide its

admissibility determination.

Nonetheless, we find no error in the exclusion of this evidence. The

holding from the Gabus court relied extensively on Oklahoma Rules of Evidence

§ 2403 and § 2702. Gabus, 678 P.2d at 254–55; see Okla. Stat. tit. 12, § 2403

(“Although relevant, evidence may be excluded if its probative value is

substantially outweighed by the danger of unfair prejudice, confusion of the

issues, misleading the jury, undue delay, needless presentation of cumulative

evidence, or unfair and harmful surprise.”); id. § 2702 (“If scientific, technical or

other specialized knowledge will assist the trier of fact to understand the evidence

or to determine a fact in issue, a witness qualified as an expert by knowledge,

skill, experience, training or education may testify in the form of an opinion or

otherw ise.”). These rules are identical to Federal Rules of Evidence 403 and 702.

Under the Federal Rules, statements by investigating officers as to accident

causation are generally not admitted unless (1) perceived by the witness and

helpful to a determ ination of a fact in issue, see Fed. R. Evid. 701, or (2) in the

case of an expert, necessary to aid the jury in the interpretation of scientific,

technical, or other specialized facts, see id. 702. Neither of these conditions are

met here. As we stated earlier, the jury was fully capable of concluding whether

-39-
or not Sims committed suicide. See Dazey, 403 F.3d at 1172. The investigating

officer’s opinion on this matter was no more than speculation based on the same

facts that the jury had before it. W e therefore find that had the district court

properly applied the Federal Rules, it would have excluded the officer’s testim ony

concerning causation. In short, there was no error in the court’s exclusion of the

testim ony under state law .

4. Father’s Suicide

Great American’s last evidentiary argument is that the district court

improperly excluded evidence showing that Sims’s father comm itted suicide. The

court concluded that the danger of unfair prejudice substantially outweighed the

probative value of the evidence under Federal Rule of Evidence 403. Because

this evidence is both irrelevant 1 7 and highly prejudicial, the district court did not

abuse its discretion. See Christiansen v. City of Tulsa, 332 F.3d 1270, 1283 (10th

Cir. 2003).

B . Sufficiency of the E vidence

In addition to its evidentiary claims, Great American asserts that the

evidence was insufficient to support the bad faith and punitive damages awards.

W e review de novo a district court’s denial of a motion for judgment as a matter

17
Great American argues that this evidence suggests a “like father, like
son” inference. However, Great American has produced no reliable scientific
evidence to support this proposition.

-40-
of law , view ing the evidence in a light most favorable to the opposing party and

drawing all reasonable inferences therefrom. Hardeman v. City of Albuquerque,

377 F.3d 1106, 1112 (10th Cir. 2004). W e do “not weigh the evidence, pass on

the credibility of the witnesses, or substitute [our] conclusions for that of the

jury.” Id. at 1116 (internal quotation marks omitted). Only if “there is no legally

sufficient evidentiary basis for a reasonable jury to find for the issue against that

party” do we reverse a jury’s verdict. Fed. R. Civ. P. 50(a)(1).

1. B ad Faith

Under Oklahoma law, “an insurer has an implied duty to deal fairly and act

in good faith with its insured.” Christian v. Am. Home Assurance Co., 577 P.2d

899, 904 (Okla. 1977). If an insurer fails to fulfill this duty, a bad faith action in

tort can arise. Id. This is not to say, however, that an insurer may never dispute

coverage; to the contrary, an insurer needs only a legitimate basis for doing so.

Id. at 905; Timberlake Constr. Co. v. U.S. Fid. & Guar. Co., 71 F.3d 335, 343

(10th Cir. 1995). The Oklahoma Supreme Court cautions:

W e recognize that there can be disagreements between insurer and
insured on a variety of matters such as insurable interest, extent of
coverage, cause of loss, amount of loss, or breach of policy conditions.
Resort to a judicial forum is not per se bad faith or unfair dealing on the
part of the insurer regardless of the outcome of the suit.

Christian, 577 P.2d at 905.

-41-
 The simple presence of a legitimate dispute does not necessarily end the

inquiry. Instead, it shifts the burden to the insured to present additional evidence

of bad faith. M ost commonly, the insured asserts an insurer’s failure to “conduct

an investigation reasonably appropriate under the circumstances.” Buzzard v.

Farmers Ins. Co., 824 P.2d 1105, 1109 (Okla. 1991). An investigation does not

meet this standard if (1) the manner of investigation hints at a sham defense or

otherwise suggests that material facts were overlooked, or (2) the insurer

intentionally disregarded undisputed facts supporting the insured’s claim. Oulds

v. Principal M ut. Life Ins. Co., 6 F.3d 1431, 1442 (10th Cir. 1993).

The “essence” of such a claim, though, is always the “insurer’s

unreasonable, bad-faith conduct.” M cCorkle v. Great Atl. Ins. Co., 637 P.2d 583,

587 (O kla. 1981); accord Willis v. M idland Risk Ins. Co., 42 F.3d 607, 612 (10th

Cir. 1994). “The decisive question is whether the insurer had a good faith belief,

at the time its performance was requested, that it had justifiable reason for

withholding payment under the policy.” Buzzard, 824 P.2d at 1109 (quotation

omitted). Put simply, “tort liability may be imposed only where there is a clear

showing that the insurer unreasonably, and in bad faith, withholds payment of the

claim of its insured.” Christian, 577 P.2d at 905.

“W hen there is conflicting evidence from which different inferences may be

drawn regarding the reasonableness of the insurer’s conduct, then what is

-42-
reasonable is always a question to be determined by the trier of fact . . . .” Peters

v. Am. Incom e Life Ins., 77 P.3d 1090, 1097 (O kla. 2002).

W ith these principles in mind, we now turn to the facts of this case.

a. Legitimate Dispute

Our first inquiry is whether Great American had a legitimate basis to deny

coverage. The facts here allow two plausible interpretations of the events that

transpired: (1) Sims perished in an unintended and tragic accident, as the jury

found, or (2) Sims committed suicide. Great American presented ample evidence

to suggest the latter. Foremost, the jury review ed M rs. Sims’s sw orn statement to

the police, where she stated that her husband “mention[ed] driving off a cliff” and

had become “angrier and angrier.” The police officer who took this statement

interpreted it to imply that Sims was not only enraged but suicidal. Indeed,

Sims’s apparent conduct lends credence to this interpretation. No skid marks or

other evidence at the scene indicated any intent to avoid the accident. Nor did

Sims take his routine precaution to avoid injury— he failed to fasten his seat belt.

Finally, although he did not drive off a cliff per se, within moments of leaving his

home, Sims did launch his vehicle off an incline that propelled him some 115 feet

across a river bed.

Aside from this evidence, every official report listed suicide as the cause of

death: the accident report, the medical examiner’s report, and the death

-43-
certificate. Even the official missing persons report indicated that Sims might be

suicidal. W hile it may be true that these reports were primarily based on M rs.

Sims’s sworn statement to the police, a statement she later recanted, this fact does

not negate the conclusion reached in these reports for the purpose of determining

whether a legitimate dispute existed. Notably, the conclusions in these reports

were not made at the behest of Great American— the medical examiner and

investigating officer had no connection with Great American. An insurer can

reasonably rely on such evidence when making its preliminary decision to dispute

coverage.

Given the evidence before Great American at the time a decision on

payment was required, the evidence clearly demonstrates a legitimate dispute

concerning coverage. Therefore, M rs. Sims had to present additional evidence of

bad faith to survive a motion for judgment as a matter of law.

b. Adequate Investigation

M rs. Sims argues that Great American did not perform an investigation

reasonably appropriate under the circumstances. Great American counters that a

more thorough investigation would not have produced additional relevant

information that would nullify the undisputed evidence of suicide.

Great American cites to our decision in Timberlake Construction Co. v.

United States Fidelity & Guaranty Co. for this proposition:

-44-
 [W ]hen a bad faith claim is premised on inadequate investigation, the
insured must make a showing that material facts were overlooked or
that a more thorough investigation w ould have produced relevant
information. [The insured] made no such showing. For example, w hile
[the insured’s] expert, testified that [the insurer] breached the duty of
good faith by not questioning [the insured’s] representatives
[concerning the dispositive issue], [the representatives’] view s on this
subject would not have changed the underlying facts already known to
[the insurer] , facts from which [the insurer] was entitled to form a
reasonable belief [about the dispositive issue] .

71 F.3d at 345 (emphasis added).

Extending this logic here, Great American asserts that it conducted an

investigation reasonably appropriate under the circumstances and that no amount

of additional evidence would have changed the underlying facts. It overlooked no

material facts; it did not intentionally disregard undisputed facts in favor of the

insured; and any additional facts could not have changed the conclusions drawn in

the various state officials’ reports. W e agree.

The key failure, according to M rs. Sims, is the lack of any investigation

into motive. In particular, she argues, Great American should have explored this

issue with her and her daughter. 1 8 To be sure, Great American was aware the

18
Additionally, she argues that Great American could have examined the
car, requested an autopsy to be performed, or visited the accident site. But
nothing suggests that additional material evidence would have been discovered
inconsistent with what the parties already knew. If the facts suggested a
mechanical malfunction or health problem— which they do not— then this
argument might have more force. A failure to investigate theory must be based on
more than hypothetical loose ends.

-45-
Sims family adamantly rejected any assertion that Sims committed suicide. Great

American also knew that Sims’s medical history did not reveal any evidence of

depression and that he was drunk when he left in his car that evening. And it is

hardly necessary to concede that committing suicide over a messy kitchen is

improbable.

Yet, the operative inquiry is whether additional questioning of M rs. Sims

regarding a motive and questioning her daughter for the first time would have led

to new or significant information. W e think not. In the first place, M rs. Sims and

her daughter had every reason to contest a finding of suicide: a $300,000 life

insurance benefit hung in the balance. M oreover, M rs. Sims told police her

husband mentioned “driving off a cliff.” It is true she told Broyles that Sims did

not commit suicide, and Broyles did not ask for further clarification. But even if

it had, only a few additional questions could have been asked, and these would

have revealed nothing new.

Great American could have further investigated by asking M rs. Sims about

the obvious inconsistency between her sw orn police statement and her statements

to Broyles. Yet this inquiry would not have changed the underlying facts upon

which Great American was entitled to rely: the missing persons report, the death

certificate, the medical examiner’s report, and the accident report. See

Timberlake, 71 F.3d at 345.

-46-
 M rs. Sims also contends that the fact an officer added language to a police

form she signed in blank should have changed the underlying facts already know n

to Great American. But the officer testified that he interpreted her body language

and her statement to suggest Sims possessed a suicidal state of mind. Just as

importantly, this fact does not present anything new, as M rs. Sims repeatedly told

Broyles she did not think her husband was suicidal. We cannot draw from this

alleged failure any suggestion that Broyles or Great American conducted a

superficial investigation.

In sum, we conclude that the district court improperly submitted the issue

of bad faith to the jury and reverse the jury verdict awarding damages on this

claim.

2. Punitive D am ages

Great American argues that the evidence was also insufficient to support a

punitive damages verdict. Because a finding of punitive damages necessarily

entails a finding of bad faith, Willis, 42 F.3d at 614–15, and because we find the

evidence insufficient to support bad faith, we reverse the punitive damages

verdict.

W e note that even were we to have left the bad faith verdict intact, punitive

damages still would have been inappropriate. Punitive damages are awarded

“only when the evidence plainly show s oppression, fraud, malice, or gross

-47-
negligence.” M cLaughlin v. Nat’l Ben. Life Ins. Co., 772 P.2d 383, 386 (Okla.

1988) (quotation omitted). Stated differently, an insurer must “recklessly

disregard” or “intentionally and with malice breach[] its duty to deal fairly and act

in good faith with its insured.” Okla. Stat. tit. 23, § 9.1 (B), (D) (2005); see

Badillo v. M id Century Ins. Co., 121 P.3d 1080, 1106 (O kla. 2005).

The evidence in this case plainly does not support this conclusion. In

addition to the evidence supporting its claim denial, Great American did not

engage in conduct that has supported punitive damages in other cases. It did not

falsify any documents. See, e.g., Timmons v. Royal Globe Ins. Co., 653 P.2d 907,

917 (Okla. 1982). Nor did it offer to settle the claim if M rs. Sims fired her

counsel. See, e.g., id. Great American did not simply deny coverage based on

skeletal information. It hired an experienced, independent claim investigation

agency to review the evidence and interview witnesses. The investigator

reviewed Sims’s medical and pharmaceutical history, interviewed numerous

individuals with knowledge of the accident, and obtained relevant documentation

from government officials. See, e.g., Buzzard, 824 P.2d at 1115 (“Farmers was

notified of the claim the day after the accident but failed to conduct any

investigation.”) (emphasis added).

Great American remained steadfast in its reasoning for denying the claim.

It never argued that the denial was appropriate for any reason other than the

-48-
alleged suicide. See, e.g., id. (“At trial, [the insurer] raised the issue of [the

insured’s] negligence, asserting that denial of the claim was based on [this

negligence]. However, nowhere in [the insurer’s] file was comparative

negligence mentioned as a reason for denial.”). Finally, Great American did not

attempt to conceal the identity of its investigator or obtain confidential

information without M rs. Sims’s permission. See, e.g., Timmons, 653 P.2d at

917. In short, because we find that the evidence does not support a finding of

bad faith, we also cannot affirm a finding of punitive damages. Even were we to

have affirmed the jury’s finding on bad faith, Great American’s conduct does not

demonstrate the elements of fraud or evil intent to which punitive damages are

directed. W e therefore find no legally sufficient evidentiary basis for a

reasonable jury to aw ard punitive damages.

C . E xclusion of Expert W itness

Great American finally contends that the district court improperly excluded

its accident reconstruction expert as being untimely disclosed. Federal Rule of

Civil Procedure 26(a)(2)(C) requires that

disclosures shall be made at the times and in the sequence directed by
the court. In the absence of other directions from the court or
stipulation by the parties, the disclosures shall be made at least 90 days
before the trial date or the date the case is to be ready for trial . . . .

(emphasis added). Here, Great American disclosed its expert more than 90 days

before the trial actually began. Based on this fact, Great American urges that its

-49-
disclosure was timely because the trial date is the actual, as opposed to the

scheduled, date of the trial.

W e find Great American’s disclosure untimely in either case. Rule 26

requires disclosure 90 days prior to the trial date unless otherwise directed by the

court. Because the date of disclosure is initially determined per court order, the

district court’s scheduling orders are dispositive. Here, the court initially

scheduled witness lists to be disclosed by M arch 7, 2003. The court amended this

order twice. The final scheduling order set the date for expert disclosures for

June 6, 2003. Great American filed a final witness list on that date without

including the accident reconstruction expert. Despite ample opportunity to

request an amendment to the scheduling order, 1 9 Great American never did so,

instead opting to file an Amended Witness List on November 12, 2003, five

months past the original deadline.

Because G reat American did not com ply with the court’s scheduling order,

the district court properly excluded Great American’s accident reconstruction

expert as untimely disclosed.

19
Great American filed a joint motion to amend the scheduling order on
July 1, 2003. In its motion, Great American did not request an extension of the
date for witness disclosures. M rs. Sims filed a second motion to amend on
August 15, 2003. Again, Great American did not request an extension.

-50-
 V III. C onclusion

Accordingly, we REVERSE the district court’s denial of judgment as a

matter of law on both the bad faith and punitive damages claims. W e otherwise

AFFIR M .

-51-
04-5135 - Sims v. Great American Life Insurance Com pany

H A R T Z , Circuit Judge concurring/dissenting.

I join Judge Tym kovich’s im pressive opinion except in two respects. First,

I would not recognize any restrictions on the validity of Fed. R. Evid. 401 in

diversity cases. Second, I would not hold that it was harm less error to exclude

the seatbelt evidence.

It seem s to m e that my view of the validity of Rule 401 follows inexorably

from the logic of the opinion itself. The opinion convincingly establishes that

Rule 401 is not subject to the Rules of D ecision Act or the Rules Enabling Act.

And Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22 (1988), im poses no

lim its on Rule 401 because it is “capable of classification as a procedural rule,”

id. at 32. Indeed, it is a quintessential procedural rule.

This is not to say that Rule 401 can be applied in diversity cases without

reference to state substantive law . Far from it. State law governs the plaintiff’s

cause of action and the defendant’s defenses. The trial court m ust look to that

law when deciding whether evidence m eets Rule 401’s definition of relevant

evidence: “evidence having any tendency to m ake the existence of any fact that is

of consequence to the determ ination of the action m ore probable or less probable

than it would be without the evidence.” If state law renders evidence of no

consequence to resolution of the claim , then the evidence is irrelevant under

Rule 401.
 For example, if Oklahoma law says that failure to wear a seatbelt is not

negligence for the purpose of determining a plaintiff’s com parative fault in a tort

case, then evidence of such failure is not relevant under Rule 401 when offered to

prove such comparative fault. Sim ilarly, if, under a state parol-evidence rule, the

contract between two parties does not incorporate oral agreements that contradict

the term s of the written contract, then evidence of the oral agreement is not

relevant under Rule 401. Thus, in a sense, application of Rule 401 in a diversity

case requires examining whether a state rule of evidence is one of procedure or of

substance. If the state rule is one of substance because it determ ines that a fact

(such as seatbelt use) is or is not, in the words of Rule 401, “of consequence to

the determ ination of the action,” then the state rule governs the application of

Rule 401. If, however, the state rule is “substantive” only in som e other sense, it

does not affect application of Rule 401.

The approach that I prefer leads to the same conclusions reached by the

m ajority opinion regarding the admissibility of evidence in this case. Perhaps

application of the m ajority’s form ulation will never differ from what I conceive to

be the proper rule. Future cases w ill tell. I do, how ever, think that a virtue of m y

approach (besides being, in m y view, correct) is that it makes the trial judge’s

task m ore straightforward. Just apply Rule 401 on its own term s, and the ruling

will be correct.

-2-
 Turning now to harm less error, the majority and I agree that the district

court erred in excluding the evidence that M r. Sims had a habit of fastening his

seatbelt but had not done so w hen he drove to his death. In what I view as a close

case, this significant evidence could have changed the result. I would therefore

reverse the breach-of-contract judgm ent and rem and for a new trial.

M y chief disagreem ent with the m ajority opinion on this point is not,

however, its conclusion. Reasonable people can differ on whether the failure to

admit the seatbelt evidence was harm less error. M y particular concern is one

aspect of the m ajority’s analysis— the reference to the jury’s verdicts on bad faith

and punitive damages. The majority reasons that this jury m ust not have found

the suicide issue to be a close call because it proceeded to rule against the insurer

on bad faith and punitive damages. Because, as the majority opinion notes, the

general rule is that one looks at the specific jury in assessing whether error is

harm less, the m ajority’s conclusion appears to follow. But I am not persuaded.

To be sure, the jury did find bad faith and award punitive dam ages. On appeal,

however, we set aside both findings for lack of evidence. In other words, the

jury’s fact finding was unreasonable. It seems peculiar to base our harm less-error

ruling on a jury’s unreasonable, irrational finding on another issue. In this

circumstance, I think the proper approach is not to look at this particular jury (or

at least this jury’s findings on bad faith and punitive damages) in assessing

-3-
whether error w as harm less but to consider what a hypothetical rational jury

would do.

-4-