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HENDRY v. KRAFT FOODS GROUP, INC. et al

ATTENTION: It is possible that this information may no longer be current and therefore may be inaccurate. The index contains both open and closed cases and is not a complete list of cases in which an ACE Insurance Group company is involved. This information is provided to give interested persons an idea of the issues disputed in the indexed cases. For a full understanding of a case, one should read the rest of the court file, including the response. For the most up-to-date and complete information on a case, visit www.pacer.gov or contact the clerk of the relevant court.

Case Number: 
1:15-cv-00234 Search Pacer
ACE Group party(s): 
Opposing Party: 
John D. Hendry
Court Type: 
Federal
US District Court: 
Southern District of Mississippi
Date Filed: 
Jul 17 2015

COMPLAINT

1 PARTIES

1. The Plaintiff, John D. Hendry, is an adult resident citizen o f Jackson County,
State o f Mississippi. His residence .address is 15201 Brodnax Road, Ocean Springs, Mississippi
39565. '
2. The Defendant, Kraft Foods Group, Inc. f/k/a Kraft Foods Global, Inc. is a
company licensed by the Office o f the Secretary o f State to do business in the State o f
Mississippi whose Registered Agent for Sendee o f Process is: C TCotporation System, 645
Case l:15-cv-00234-HSO-JCG Document 1-2 Filed 07/17/15 Page 10 of 27
Lakeland East Drive, Suite 101, Flowood, MS 39232. Kraft Foods is a Delaware corporation
with its principal office located at Three Lakes Drive, Northfield, IL 60093-2753.
3. The Defendant, Ace American Insurance Company is a company licensed by the
State o f Mississippi Insurance Department to do business in Mississippi and has appointed its
Registered Agent for Service o f Process as C T Corporation System, 645 Lakeland East Drive,
Suite 101, Flowood, MS 39232.
4. The Defendant, ESIS, Inc., is a company licensed by the Office o f the Secretary o f
State to do business in the State o f Mississippi whose Registered Agent for Service o f Process is:
C T Corporation System, 645 Lakeland East Drive, Suite 101, Flowood, MS 39232. ESIS, Inc.
is a Pennsylvania corporation with its principal office located at 436 Walnut Street, Philadelphia,
PA 19106 and a regional office o f P.O. Box 31133, Tampa, FL 33631-3133.
5. The Defendant, Aetna Insurance Company is a company licensed by the Office of
the Secretary o f State to do business in the State o f Mississippi whose Registered Agent for
Service o f Process is: C T Corporation System, 645 Lakeland East Drive, Suite 101, Flowood,
MS 3 9232. Aetna Insurance Company is a Delaware corporation with its principal office
located at 151 Farmington Avenue, Hartford, C T 06156 and a regional office o f P.O. Box
14560, Lexington, KY 40512-4560.
. 6. Defendants, ABC, DEF, GHI, JKL, MNO; PQR, STU, and VWX (hereinafter
"ABC,,, MDEF", “GHI”, “JKL”, “MNO”, “PQR”, “STU”, “VWX”) are fictitious corporations,
entities or persons whose real names and business addresses are unknown to the Plaintiff at this
time, but whose real names and addresses will be made part o f this Complaint at such time as
they do become known to the Plaintiff, and at which time process o f this Court may be served on
such parties.

H JURISDICTION AND VENUE

7. This Court has subject matter jurisdiction over this action pursuant to Miss. Code
Ann. § 9-7-81, et seq.
8. Venue is proper in the Circuit Court o f the First Judicial District o f Harrison
County, Mississippi, pursuant to Miss. Code Ann. § 11-11-3 because a substantial act or
omission occurred in this county and/or a substantial event that caused Plaintiff's injuries and
damages occurred.

m . ACTS OF AGENTS

9. Whenever it is alleged in this Complaint that Defendants Kraft Foods Group, Inc.
f/k/a Kraft Foods Global, Inc., Ace American Insurance Company, ESIS, Inc. and/or Aetna
Insurance Company did any act or thing or failed to do any act or thing, it is meant also that the
officers, agents or employees o f Defendants Kraft Foods Grup, Inc. Lk/a/ Kraft Foods. Global,
Inc., Ace American Insurance Company, ESIS, Inc., and/or Aetna Insurance Company
respectively performed, participated in, or failed to perform such acts or things while in the
course and scope o f their employment or agency relationship with Defendants Kraft Foods
Group, Inc. f/k/a Kraft Foods Global, Inc., Ace American Insurance Company, ESIS, Inc., and/or
Aetna Insurance Company. To reiterate, whenever the Complaint refers to Defendants Kraft
Foods Group, Inc. f/k/a Kraft Foods Global, Inc., Ace American Insurance Company, ESIS, Inc.,
and/or Aetna Insurance Company, it applies specifically to Kraft Foods Group, Inc. f/k/a Kraft
Foods Global, Inc., Ace American Insurance Company, ESIS, Inc., and/or Aetna Insurance
Company, and their employees and agents, both individually and collectively.

IV. FACTS

10. On June 19.2008, Plaintiff John D. Hendry was employed by Kraft Foods Group,
Inc. f/k/a Kraft Goods Global, Inc. (hereinafter "Kraft") as a sales representative. On or about
that day, while working on the job in Gulfport, Mississippi at the Navy Commissary, and in the
course o f his employment with Kraft, Mr. Hendry sustained injuries to his head, neck, shoulders,
back, arms, legs and body as a whole when, as he was stocking shelves, he stepped back,
misjudging the distance to the floor and fell off a two-step ladder.
11. At all times pertinent hereto, Kraft had workers' compensation coverage through
Ace American Insurance Company (hereinafter "Ace American").
12. At all times pertinent hereto, Defendant ESIS, Inc. (hereinafter "ESIS1") served as
the Third Party Administrator o f workers' compensation claims for Kraft/Ace American. Mr.
Hendry's claim was assigned to Deborah Segura, an ESIS Case Manager, and Mr. Hendry's
workers' compensation claim was submitted to ESIS and Deborah Segura for adjustment On
November 10,2011, Plaintiff was notified that Cecilia Hurst was going to serve as his Adjustor
for his claim.
13. At all times during this claim, Becky Riecke, served as the Case Manager for this
claim through Coventry Health Care Workers Compensation, Inc. (hereinafter “Coventry). This
included but was not limited to attempted attendance during medical appointments, attempted
and completed illegal ex parte conferences with medical professionals and scheduling o f medical
appointments and testing.
14. Mr. Hendiy saw his primary care provider, Dr. Shelby on June 20,2008, who*
diagnosed him with mild L4-5 intravertebral disc displacement and who ordered an MRI.
15. One July 9,2008, Mr. Hendry had an MRI which showed" 1. Minimal
subligamentous and left paracentral L4-5 disc protrusion. No significant thecal sac or lateral
recess impingement is noted. 2. Multiple probable vertebral hemangiomata unchanged."
. 16. On August 27,2008, the Defendants without any arguable or debatable reason
ceased paying disability benefits.
17. Mr. Hendry was advised by'Defendant Kraft that he would have to be released to
full duty before he could return to work.
18. To address the continued debilitating back pain. Dr. Shelby referred Mr. Hendiy
first to physical therapy and then to pain management for treatment Neither treatment was
successful. Dr. Shelby referred Mr. Hendry to Dr. Lee Kesterson, a neurosurgeon, after advising
Mr. Hendiy that he had done all that he could do.
19. On March 14,2011, Dr. Kesterson ordered a Lumbar Spine CT which revealed
suggested "posterolateral disc rupture o f L4-L5 on the right"
20. Mr. Hendiy had surgery performed by Dr. Kesterson on August 16,2011, which
consisted o f a right transforaminal lumbar interbody fusion at L4-5.
21. Defendants have paid for Mr. Hendry's medical treatments, including the
aforementioned surgery.
22. Mr. Hendiy has received a benefit check from Aetna Disability since June 2008,
5
when the injury occurred.
23. On April 13,2011, Lisa Lefkowitz, Claims Specialist at Aetna Disability wrote
Mr. Hendry and indicated that the monthly benefit would continue for another twelve months
before review so long as Mr. Hendry was under a doctor’s care.
24. Mr. Hendry was terminated by Kraft on April 19,2011.
25. Aetna Disability sent another letter to Mr. Hendry on August 1,2011, staling that
as he was no longer employed by Kraft, he would be receiving retirement benefits from Kraft in
the amount o f $1,727.83 effective June 1,2011. Aetna also requested $1,727.83 in
reimbursement for the June 2011 benefit He was then informed that all future benefit payments
would be $812.17. The reimbursement would betaken out o f all future benefit payments by
$287.97.
26. Despite the assertion by Aetna Disability that Mr. Hendry was receiving
retirement benefits from Kraft, Mr. Hendry has not received any retirement benefits from Kraft.
27. While Mr. Hendry does have pension benefits from Kraft, they are in the form o f
an IRA which he is unable to draw from without incurring significant penalty.
28. Mr. Hendry was also informed by Aetna Disability that he would be receiving
Worker* s Compensation benefits for income. .
29. These Worker’s Compensation benefits were intentionally delayed.
30. In January 2012, Social Security Disability benefits were awarded to Mr. Hendry
in the amount o f $2,117.00 per month, with checks being issued beginning on February 22,2012.
31. On January 6,2012, Aetna Disability wrote Mr. Hendry notifying him that his
benefits would be reduced to $100.00 per month. The letter also sought reimbursement in the
amount o f $7,102.19 for overpayments from June 2011 through December 2011.
32. Defendant Aetna Disability acted in bad faith in handling Mr. Hendry’s disability
claim by acting as it did in its payments, timeliness, adjustments, credits and calculations.
33. Mr. Hendry continued to see a variety o f doctors, including Dr. Joe Chen, Dr.
Howard Katz, Dr. Bart Edmiston, Dr. Lee Kesterson, and Dr. Terry Smith. Following surgery,
Dr. Kesterson gave Mr. Hendry an MMI date o f April 12,2012 with a PPI rating o f 15%.
34. On June 4,2012, the Administrative Judge in the Workers’ Compensation Claim
found that Employer and Carrier only paid temporary total disability benefits from April 1,2009
to April 28,2009. (See Order dated June 4,2012, attached hereto as Exhibit “A”.) This decision
included a reservation o f any potential bad frith claim for withholding appropriate temporary
total disability benefits the Plaintiff was due from August 27,2008 through February 17,2009.
35. Prior to the order. Employer and Carrier represented to Mr. Hendry and his
attorney during the August 27,2008 to February 17,2009 time period that additional time was
needed to complete their investigation to determine if they would voluntarily pay temporary total
disability benefits during that time period. At no time through the date o f the order was an
"investigation” completed into this issue.
36. The Court found that Mr. Hendry was eligible for benefits from February 17,2009
to the date o f the order, June 4,2012 (see Exh. “A” attached) and that the Employer and Carrier
had proved no reasonable basis why temporary total disability payments during that same period
were not paid.
37. The Court found no reason for the delay in the determination on whether Mr.
Hendry was eligible for benefits from August 27,2008 to February 17,2009 on June 4, 2014.
(See Exh. “A” attached.)
' 38. A sa result o f Defendants' refusal to compensate Mr. Hendry in accordance with,
the terms o f the Mississippi Workers' Compensation laws, Mr. Hendry filed a Petition to
Controvert with the Mississippi Workers' Compensation Commission on or about September 30,
2011. Among other things, Mr. Hendry's Petition alleged that he sustained an injury to his head,
neck, shoulders, back, aims, legs and body as a ’whole on June 19,2008, while working for Kraft.
3 9. Despite their lack o f a legitimate or arguable basis to refuse payment o f workers'
compensation benefits. Defendants at all times failed and refused to pay all disability benefits for
medical care rendered to Mr. Hendry, and other benefits due under Mississippi’s workers'
compensation laws.
40. On June 4,2012, the Court noted that the Employer and Carrier have requested
additional time to determine if they would voluntarily pay total disability for the time period from
August 27,2008 to February 17,2009. This position was first taken in the Answer to the Petition
to Controvert filed October 26,2011.
41. A sa result o f their continued denial and request for additional time, Mr. Hendry
agreed to a settlement with the Defendants on June 24,2014. The stipulated settlement set aside
any potential bad faith claim for the denial of benefits due prior to February 17,2009.
42. As a result o f their denial o f Mr. Hendry's claim regarding his injuries from the
work-related incident. Defendants denied payment o f necessary medical expenses for the
treatment o f the same and denied disability payments and other benefits to which Mr. Hendry
was entitled to under Mississippi law. Because o f the denial of such benefits, Mr. Hendry was
delayed in obtaining appropriate medical treatment; endured pain and suffering because o f the
delay in medical treatment; experienced economic loss; endured and was caused to experience
and suffer significant emotional and mental distress; and suffered other damages as set forth
herein.

V, CAUSES OF ACTION
COUNT I: GROSS NEGLIGENCE

43. Plaintiff re-alleges each o f the foregoing paragraphs as if fully set out herein.
44. . In denying Mr. Hendry's benefits due to him under Mississippi Workers'
Compensation law and previously paying his disability claim, the Defendants acted with gross
negligence, willful disregard and/or malice.
45. Defendants were grossly negligent in failing to monitor the actions o f their
officers, employees and/or agents; in failing to promptly and thoroughly investigate a covered
claim; in failing to promptly pay medical bills arising from a covered claim; in unduly and <
unreasonably terminating Plaintiffs claim; in failing to act on Plaintiffs claim in accordance with
the obligations imposed under the Mississippi Workers' Compensation Act; in maintaining an
unreasonable position o f claim denial despite all credible medical evidence to the contrary; in
failing to train their insurance adjusters and employees to properly handle Workers'
I
Compensation claims; in failing to properly follow and/or apply industry standards as well as
their own rules, regulations, policies and procedures in adjusting and honoring Plaintiffs claim;
in failing to properly follow and/or apply industry standards as to the Plaintiffs claim reported
under the subject policy; and in failing to abide by their obligations under the Mississippi
Workers' Compensation Act with regard to Plaintiffs claim, when they lacked any legitimate or
arguable basis for denial of Plaintiffs claim.
46: Defendants were grossly negligent in failing to properly compensate Plaintiff
under the terms o f his disability benefit policy; in improperly calculating payment amounts due
to Plaintiff; in improperly crediting and deducting adjustments from Plaintiffs claim; and in
improperly handling Plaintiff’s disability claim, when they lacked any legitimate or arguable
basis for the handling o f Plaintiffs claim.
47. The acts o f Defendants as described above, which were grossly negligent and in
reckless disregard o f the rights of the Plaintiff, have proximately caused Plaintiffs damages set
forth in this Complaint

COUNT H: BREACH OF CONTRACT

48. The Plaintiff re-alleges each o f the foregoing paragraphs as if fully set out herein.
49. The Plaintiff was covered by an insurance contract with his employer Kraft in
which he was entitled to receive Workers' Compensation insurance coverage.
50. The Defendants breached the subject contract by denying insurance coverage for
the medical expenses and disability payments occasioned by the Plaintiff's work related injuries.
51. Defendants breached the subject contract by improperly calculating payments,
adjustments, and credits due to Plaintiff under the terms o f subject contract
52. Defendants' breaches o f the Workers' Compensation insurance contract have
proximately caused substantial damages to the Plaintiff.

COUNT HI: BAD FAITH BREACH OF CONTRACT

54. The acts and omissions o f the Defendants rose to the level o f commission o f the
tort o f bad faith denial o f a workers' compensation insurance claim, in that the Defendants denied
a timely reported and obviously covered claim without legitimate or arguable reason for doing so.
55. Plaintiffs treating physician. Dr. Shelby, as well as Defendants' appointed
independent medical expert. Dr. Terry Smith, opined as to and established the causal connection
between Mr. Hendry’s on-the-job incident and bis injuries and treatment as described herein.
Nevertheless, Defendants continued to deny Mr. Hendry's claim.
56. Defendants lacked a credible medical basis for the denial o f Mr. Hendry's claim.
57. Defendants engaged in a pattern and practice o f conduct which subverted a
prompt adjudication o f Mr. Hendry's claim. Counsel for Mr. Hendry sent multiple letters to
Defendant asking that an employee o f Defendant cease and desist ex parte communications with
Mr. Hendry's physicians. There were communications sent to her on July 27,2011, August 9,
2011, September 1,2011, September 26,2011 and April 24, 2012. Letters were also sent to the
counsel for the Defendants concerning this behavior on April 20,2012 and April 24,2012.
Despite these multiple contacts. Defendant’s employee persisted in this behavior, including
conducting an ex parte conference with Mr. Hendry's treating physician on May 3,2012.
58. Another Defendant’s employee was consulted about the delay in determination o f
temporary total disability benefits many times. Letters were sent to her requesting payment on
August 1, 2011, August 10, 2011, and August30,2011.
59. Defendant Aetna Disability acted in bad faith in the handling o f Plaintiff’s
disability claim regarding the payments, timeliness, adjustments, calculations, and credits owed
to die Plaintiff.
60. The Defendants acted with negligence, gross negligence, willful disregard and/or
malice in refusing to investigate and pay the workers' compensation claim submitted by the
Plaintiff. Such conduct rises to the level o f an independent tort, entitling the Plaintiff to an award
o f punitive damages.
61. The Defendants by the aforementioned actions have breached their duty o f fair
dealing and good faith owed to the Plaintiff herein in the following respects:
a. by refusing to provide Plaintiff with a defense;
b. by refusing to pay benefits consistent with the insurance contract;
c. by refusing to pay or defend the workers’ compensation claim;
d. by willfully and in bad faith refusing Plaintiff s demand for indemnity and
defense knowing that Plaintiff’s claims for said benefits were valid;
e. by willfully and in bad faith refusing to defend Plaintiff when the
Defendants knew the defense was due and owing; and
f. by willfully and in bad faith improperly handling the Plaintiff s claim
regarding payments, credits, calculations, and adjustments.
62. In the event o f an award for punitive damages. Plaintiff is entitled to the recovery
o f his reasonable attorneys' fees and expenses in the prosecution o f this action.
COUNT IV: BREACH OF FIDUCIARY DUTY
63. The Plaintiff re-alleges each o f the foregoing paragraphs as if fully set out herein.
64. Pursuant to Miss. Code Ann § 75-3-15, Defendants had a statutory duty to pay .
medical expenses and other benefits related to a legitimate work-related injury. Plaintiff
depended on Kraft Foods, Inc. to secure such benefits for him and to reimburse medical
providers for the cost o f such benefits in the event he was injured on the job. Plaintiff placed his
confidence and trust in the Defendants, individually and collectively, to properly handle his
workers' compensation claim, and relied upon the Defendants due to their superior knowledge in
the field o f workers' compensation. As a result o f the foregoing, there existed a confidential and
fiduciary relationship between Plaintiff and the Defendants.
65. The Defendants were aware o f the Plaintiffs reliance upon them to professionally,
truthfully, promptly, properly, and completely administer his workers' compensation claim as
required by Mississippi law.
66. Defendants breached their fiduciary duties owed to the Plaintiff in that they
grossly failed to fulfill their statutory obligations to provide the appropriate claims handling
i
services and to promptly and properly investigate, adjust, and pay any outstanding benefits due
and owing to Plaintiff under Mississippi law.
67. The Defendants' breaches o f fiduciary duties, as described above, have
proximately caused Plaintiff's damages set forth in this Complaint.

1 COUNTV: INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS

68. The Plaintiff re-alleges each o f the foregoing paragraphs as if fully set out herein.
69. The acts and omissions o f the Defendants amounted to the tort o f intentional
infliction o f emotional distress, in that, among other things, the Defendants knew that their
actions in wrongfully and maliciously denying coverage to the Plaintiff placed him under
financial and emotional stress, resulting in further damage and personal injury.
70. Defendants' intentional infliction o f emotional distress has proximately caused
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substantial damage to Plaintiff.

COUNT VI: PUNITIVE DAMAGES

71. The Plaintiff re-alleges each o f the foregoing paragraphs as if fully set out herein.
72. It is believed and therefore averred that Defendants knowingly, willfully, and in
reckless disregard o f the rights of the insured, John D. Hendry, did arbitrarily and wrongfully
deny the claims o f the Plaintiff, John D. Hendry, without any legitimate and arguable reason in a
reckless, willful and malicious manner.
73. As evidence o f this willful and arbitrary behavior, the Defendants' continued to
assert more time was needed to investigate whether disability payments were due to Mr. Hendry
from August 27, 2008 to February 17,2009. The assertion o f needing more time continued,
despite acknowledgment that Defendants were aware o f the on-the-job injury. This continued
assertion o f needing more time demonstrates that the Defendants knowingly, willfully, and in
reckless disregard o f the rights o f the insured, John D. Hendry, did arbitrarily and wrongfully
deny the claims o f the Plaintiff, John D. Hendry, without any legitimate and arguable reason in a
reckless, willful and malicious manner.
74. The actions o f Defendants were so egregious, callous, malicious, and grossly
negligent as to infer intentional indifference and reckless disregard to the rights, both
contractually and otherwise, o f the Plaintiff, John D. Hendry. The actions o f the Defendants were
reprehensible and entitle the Plaintiff to punitive damages to punish the Defendants from
undertaking such actions again and to deter others in the same or similar position from
undertaking such wrongful actions. Furthermore, the actions o f the Defendants were intentionally
committed against the Plaintiff so as to justify an award o f punitive damages under Miss. Code
Ann. § 11-1-65. Additionally, the Defendants' conduct was grossly negligent and was attended by
circumstances o f intentional and gross negligence, malice and willful and wanton misconduct
with a reckless and callous disregard for the rights o f the Plaintiff and the public in general
75. In the event o f an award o f punitive damages. Plaintiff is entitled to recovery o f
attorneys' fees and expenses incurred in the prosecution o f this action.

VI: DEMAND FOR JURY TRIAL

76. • The Plaintiff respectfully demands a trial by jury on all issues o f fact presented in
this Complaint.
77. Plaintiff, John D. Hendry, would request that the Defendants herein be duly
ordered to appear and answer the Complaint and that upon a final trial o f this cause that the
Plaintiff be awarded a judgment o f and from the Defendants, jointly and severally, as follows:
a. For fiill insurance coverage under the subject policy o f workers'
compensation insurance for the injuries, disability and medical expenses
caused by his work related incident, which occurred on or about June 19,
. 2008, and to other appropriate relief;
b. For monetary damages;
c. For all economic losses suffered by Plaintiff as a result o f Defendants'
conduct, to include, but not limited to, compensatory damages including,
out-of-pocket expenses in an amount which is sufficient to provide
restitution and repayment to the Plaintiff for sums expended on account o f
Defendants* wrongful conduct, said amount to. be determined at trial;
d. For emotional distress damages;
e. For damages for pain and suffering;
f. For punitive damages;
g. For court costs, attorneys fees, and expenses;
h. any and all other legal and equitable relief deemed appropriate by the
Court;
I. prejudgment interest and post-judgment interest; and
j. For any and all such other and further relief to which the Plaintiff may be
entitled

WHEREFORE, PREMISES CONSIDERED, Plaintiff respectfully requests that, upon a
trial o f this cause, judgment will be entered against the Defendants for all aforementioned
damages.

The provided text is an excerpt from a document filed in this case. For a full understanding of the case, one should read the complete court file, including the response.