NOT FOR PUBLICATION FILED

UNITED STATES COURT OF APPEALS DEC 13 2023

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

AMERICAN GENERAL LIFE No. 22-56149

INSURANCE COMPANY,

D.C. No. Plaintiff-counter- 2:20-cv-09743-JVS-JC defendant-Appellee,

v. MEMORANDUM*

KARO DARBINYAN; SONA

DARBINYAN,

Defendants-counter- claimants-Appellants.

Appeal from the United States District Court for the Central District of California James V. Selna, District Judge, Presiding

Submitted December 5, 2023** Pasadena, California

Before: CALLAHAN, R. NELSON, and BADE, Circuit Judges.

Karo and Sona Darbinyan appeal the final judgment following a jury trial in

favor of American General Life Insurance Company. We presume the parties’

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). familiarity with the facts and do not discuss them in detail here. We have jurisdiction

pursuant to 28 U.S.C. § 1291, and we affirm.

1. The Darbinyans first argue that the district court should have granted

their summary judgment motion because of the language barrier their mother,

Hasmik Hadajyan, faced when completing her life insurance application. Whether

this language barrier impacted Ms. Hadajyan’s understanding of the insurance

application or policy was an issue decided at trial, so the Darbinyans’ argument

amounts to a factual challenge that can only be assessed based on the trial record.

See Dupree v. Younger, 598 U.S. 729, 734-35 (2023) (“Fact-dependent appeals must

be appraised in light of the complete trial record.”). However, because the

Darbinyans did not raise a post-trial motion under Rule 50 of the Federal Rules of

Civil Procedure, there is no “lower court decision to review” and therefore we are

“powerless” to review this portion of the Darbinyans’ appeal. Id.

2. The Darbinyans next argue that the district court erred when finding at

summary judgment that Ms. Hadajyan made material misrepresentations in her

application, and that American General did not breach its duty of good faith and fair

dealing. “We review de novo the district court’s ruling on cross-motions for

summary judgment,” Equal Emp. Opportunity Comm’n v. BNSF Ry. Co., 902 F.3d

916, 921 (9th Cir. 2018), and apply California substantive law because the basis for

jurisdiction in the district court was diversity jurisdiction. Hawthorne Sav. F.S.B. v.

2 22-56149 Reliance Ins. Co., 421 F.3d 835, 841 (9th Cir. 2005).

California law requires that each party to an insurance contract “communicate

to the other, in good faith, all facts within his knowledge which are or which he

believes to be material to the contract . . . .” Cal. Ins. Code § 332; Thompson

Occidental Life Ins. Co., 513 P.2d 353, 360 (Cal. 1973) (“It is generally held that an

insurer has a right to know all that the applicant for insurance knows regarding the

state of his health and medical history.”). The record shows that Ms. Hadajyan made

misrepresentations when filing out her application and when she failed to notify

American General of changes to her answers after certain medical appointments and

tests. For example, the application asked whether Ms. Hadajyan had “been advised

to see a specialist,” had “a pending medical appointment,” and had “any test results

pending.” Ms. Hadajyan answered “No” to each of these questions. But Ms.

Hadajyan’s medical records reveal a May 2018 doctor’s appointment and a

subsequent June 2018 abdominal ultrasound showing that she was indeed “advised

to see a specialist.” Also, Ms. Hadajyan did not notify American General of a

November 2018 appointment with her primary care physician or a November 2018

CT scan. These omissions rendered inaccurate Ms. Hadajyan’s answers that she had

no pending appointments or test results. See Cal. Ins. Code § 330.

Contrary to the Darbinyans’ argument, the district court did not draw

inferences in favor of American General. The May and June 2018 medical records

3 22-56149 are convincing evidence that Ms. Hadajyan was advised to see a specialist, and the

Darbinyans did not “produce evidence” to raise a genuine dispute of this fact. See

Sonner v. Schwabe N. Am., Inc., 911 F.3d 989, 992 (9th Cir. 2018). Further, the

application required that Ms. Hadajyan notify American General “of any changes in

the statements or answers given in the application between the time of application

and delivery of any policy.” Ms. Hadajyan’s failure to do so rendered her answers

about pending medical appointments and test results untruthful notwithstanding her

belief that the November 2018 appointments were not “material changes to her

health” or that she was otherwise in “good health.”

The district court also correctly determined that these misrepresentations were

material to American General’s decision to issue Ms. Hadajyan’s policy. See Cal.

Ins. Code §§ 334, 360. American General’s specific questions about Ms. Hadajyan’s

pending medical appointments, test results, and specialty referrals were prima facie

“proof that it deemed the answers material.” Cohen v. Penn Mut. Life Ins. Co., 312

P.2d 241, 244 (Cal. 1957); see also Thompson, 513 P.2d at 360 (“The fact that the

insurer has demanded answers to specific questions in an application for insurance

is in itself usually sufficient to establish materiality as a matter of law.”). Moreover,

American General introduced evidence that “truthful disclosure” by Ms. Hadajyan

would have changed its underwriting decision. See Holz Rubber Co., Inc. v. Am.

Star Ins. Co., 533 P.2d 1055, 1064 (Cal. 1975). Even if “the trier of fact is not

4 22-56149 required to believe the ‘post mortem’ testimony of an insurer’s agents that insurance

would have been refused had the true facts been disclosed,” Thompson, 513 P.2d at

360, American General’s declaration and supporting evidence “satisfied the

elements of section 334” of California’s Insurance Code. Nieto v. Blue Shield of

Cal. Life & Health Ins. Co., 103 Cal. Rptr. 3d 906, 920 (Cal. Ct. App. 2010). Further,

the Darbinyans’ proffered expert declaration only referenced the May and June 2018

appointments and not the November 2018 appointments, so was insufficient to create

a genuine dispute as to whether American General would have declined to issue the

policy had it known Ms. Hadajyan’s “true and complete health history.”

Finally, the Darbinyans’ argument that American General acted in bad faith

is unavailing. American General asserted that, considering the “totality” of Ms.

Hadajyan’s medical records, it would have declined to issue the policy based on

information that existed “before the Policy was issued and/or delivered.” The

Darbinyans do not raise a genuine dispute of this fact. Sonner, 911 F.3d at 992.

3. The Darbinyans’ raise three issues regarding the district court’s jury

instructions, each of which fails. We review a district court’s formulation of civil

jury instructions for abuse of discretion, Smith v. City & Cnty. of Honolulu, 887 F.3d

944, 951 (9th Cir. 2018), but review de novo “whether the challenged instruction

correctly states the law.” Wilkerson v. Wheeler, 772 F.3d 834, 838 (9th Cir. 2014).

Jury instructions that improperly allocate the burden of proof “would be errors at

5 22-56149 law” and are reviewed de novo. Snapp v. United Transp. Union, 889 F.3d 1088,

1094-95 (9th Cir. 2018).

First, the district court correctly placed the burden of proof on American

General to show that Ms. Hadajyan was “aware of her material misrepresentations.”

Instruction No. 17 plainly stated that “American General must prove . . . [t]hat

Hasmik Hadajyan understood the questions on the application.”

Second, the district court properly declined to “specifically list” which of Ms.

Hadajyan’s answers on the life insurance application constituted misrepresentations.

The specific misrepresentations made by Ms. Hadajyan were not at issue before the

jury; the triable issues centered on Ms. Hadajyan’s possible language barrier and

whether Armen Barsegyan—who had helped Ms. Hadajyan fill out the application—

acted as an agent of American General when he spoke to Karo Darbinyan on

November 27. The court’s decision was therefore not “misleading” and was

unrelated to either party’s “theory of the case.”

Third, the district court accurately instructed the jury on the law of agency.

Contrary to the Darbinyans’ argument, the district court did not determine that Mr.

Barsegyan was American General’s agent at all times. The district court explicitly

held at summary judgment that there were disputes of fact whether Mr. Barsegyan

“was acting as an agent of American General when he made the call to Karo

Darbinyan” because “Mr. Barsegyan testified that in addition to American General,

6 22-56149 he was an appointed agent for ‘lots of companies.’” Accordingly, the district court

properly instructed the jury that it should “focus on the specific act or acts of Armen

. . . which the Darbinyans are seeking to attribute to American General.”

The judgment of the district court is AFFIRMED.

7 22-56149