RONALD GOLD, INDIVIDUALLY AND ON BEHALFOF ALL OTHERS SIMILARLY SITUATED
JOHN ROWLAND ET AL.
October 17, 2016
Robbin Greenspan, with whom were Matthew T. Wax-Krell and
Andrew W. Krevolin, for the appellants (named plaintiff et
K. Levin, pro hac vice, with whom were Patrick M. Fahey and
Craig A. Hoover, pro hac vice, and, on the brief, Charles L.
Howard and Peter R. Bisio, pro hac vice, for the appellees
(defendant Anthem, Inc., et al.).
Palmer, Eveleigh, McDonald, Espinosa and Robinson, Js.
certified class action, which arises from a dispute over the
proceeds of the 2001 demutualization of the defendant Anthem
Insurance Companies, Inc. (Anthem Insurance), comes before
this court for the second time. The plaintiffs are a class of
state employees and retirees who, at the time of the
demutualization, were enrolled in an Anthem Insurance group
health care insurance plan. They contend that their
participation in that plan entitled them to membership in
Anthem Insurance and a share of the demutualization proceeds,
and that Anthem Insurance and the other insurance company
defendants; see part I E of this opinion; breached their
contractual obligations by not paying the plaintiffs for
their membership interests and instead distributing their
share of the proceeds to the defendant state of Connecticut.
The first time we considered this case, we concluded that all
of the plaintiffs' claims against the named defendant,
John Rowland, the former governor of Connecticut, and the
state were barred by the doctrine of sovereign immunity or
otherwise should have been dismissed. See Gold v.
Rowland, 296 Conn. 186, 205, 209-11, 994 A.2d 106
(2010). Following our decision and a subsequent trial to the
court of the plaintiffs' breach of contract claims
against the remaining defendants, the trial court,
Bright, J., rendered judgment for those defendants.
On appeal, the plaintiffs contend that the trial court
incorrectly concluded that the relevant contract provisions
were ambiguous and improperly consulted extrinsic evidence to
determine their meaning. Finding no error, we affirm the
trial court's judgment.
AND PROCEDURAL HISTORY
with the complete factual record, as detailed in the trial
court's memorandum of decision, is presumed. The relevant
facts, as found by the trial court or stipulated to by the
parties, and procedural history may be briefly summarized as
of Anthem Insurance and Blue Cross and Blue Shield of
dispute between the parties arises from three principal
transactions and two group health care insurance policies.
The first occurred on July 31, 1997, when Anthem Insurance, a
mutual insurance company organized under Indiana law, merged
with Blue Cross and Blue Shield of Connecticut, Inc. (Blue
Cross), a mutual insurance company organized under
Connecticut law. The merger was executed pursuant to a
November, 1996 agreement to merge, which included as
attachments a plan and joint agreement of merger, a proposed
form of Anthem Insurance's third amended and restated
articles of incorporation (1997 articles), and a form group
guaranty health care insurance policy and certificate of
membership (guaranty policy). Under the plan and joint
agreement of merger, Anthem Insurance was designated as the
company that would survive the merger. Three months prior to
the merger, in April, 1997, the directors and members of
Anthem Insurance formally adopted the 1997 articles.
Following the merger, Anthem Insurance, through its
subsidiary, the defendant Anthem East, Inc., continued the
former Blue Cross operations under the auspices of the
defendant Anthem Health Plans, Inc., doing business as Anthem
Blue Cross and Blue Shield of Connecticut (New CT-Blue).
to their merger, the two mutual insurance companies took
different approaches to membership. Under Anthem
Insurance's premerger membership rules, each employee or
individual holder of a certificate of coverage under a fully
insured group health care insurance policy was an individual
member and owner of Anthem Insurance. The employer,
membership organization, or other group that procured the
group coverage was not an owner member.
Blue Cross' premerger bylaws, by contrast, the employers
were the owner members. Each employer was considered one
policyholder and would designate a representative to act on
behalf of the group for voting purposes. Individual employees
who had been issued insurance certificates were not
considered to be voting members with equity rights.
Health Care Insurance Policies
the merger, the state held two Blue Cross group health care
insurance policies relevant to the present
dispute. The first, known as Care Plus, provided
Medicare supplement group health care insurance for retired
state employees and their dependents. The state closed
enrollment in Care Plus to new members in 1994 but permitted
enrolled members to retain their coverage. The Office of the
Comptroller was designated as the voting member for that
policy. In connection with the merger, New CT-Blue delivered
a guaranty policy for Care Plus to the Office of the
second plan originated as a Blue Cross health care insurance
policy that was offered to state employees and non-Care Plus
state retirees prior to 1993. In 1993, the state converted
this policy to a self-funded, administrative services only
contract with Blue Cross (ASO agreement). It is undisputed
that the ASO agreement, as administered by Blue Cross after
1993, was not an insurance policy. Both Care Plus and the ASO
agreement were active in 1997 when Anthem Insurance and Blue
Cross merged, and they remained in effect through the first
half of 1999.
30, 1999, the state terminated the self-funded ASO agreement
and instead entered into a new, fully insured group health
care insurance policy from New CT-Blue (1999 group policy).
Under the 1999 group policy, New CT-Blue began providing
health care insurance benefits to substantially the same
group of state employees and retirees who had been covered
under the ASO agreement.
following year, in July, 2000, the state also terminated the
Care Plus plan. At that time, Care Plus covered 512 state
retirees. Those retirees were given the option of enrolling
in the 1999 group policy or in any of the other health care
insurance plans available to state retirees. Unless they
opted out, Care Plus members were, by default, enrolled in
the 1999 group policy without a lapse in coverage.
Approximately 456 of the 512 former Care Plus retirees
ultimately were enrolled in the 1999 group policy without any
lapse in coverage.
of Anthem Insurance
second key transaction that gave rise to the present dispute
occurred on June 18, 2001, when Anthem Insurance's board
of directors approved a plan to convert from a mutual
insurance company to a stock corporation under Indiana
Under the plan of conversion, upon the effective date of the
demutualization, all of the outstanding capital stock of
Anthem Insurance would be issued to the defendant Anthem,
Inc., and eligible members of Anthem Insurance would become
entitled to receive stock in Anthem, Inc., or cash, in
exchange for the extinguishment of their membership interests
in Anthem Insurance. The plan of conversion defined an
eligible member as ‘‘a [p]erson who (a) is a
[s]tatutory [m]ember of Anthem Insurance on the [a]doption
[d]ate [June 18, 2001] and continues to be a [s]tatutory
[m]ember of Anthem Insurance on the [e]ffective [d]ate
[November 2, 2001], and (b) has had continuous health care
benefits coverage with the same company during the period
between those two dates under any [p]olicy or [p]olicies
without a break of more than one day.'' During the
relevant period from June 18 through November 2, 2001
(eligibility period), the plaintiffs continuously held
certificates of coverage under the 1999 group policy.
third relevant transaction occurred between late 2001 and
early 2002, when Anthem Insurance distributed more than 1.6
million shares of stock in Anthem, Inc., to the state, on the
basis of its determination that the state-and not the
individual state employees and retirees-was the eligible
member under the 1999 group policy. Thereafter, the state
sold the stock for $93, 768, 950, transferred the proceeds to
the general fund; see Public Acts, Spec. Sess., May, 2002,
No. 02-1, § 39; and spent them. Gold v.
Rowland, supra, 296 Conn. 193-94. Anthem Insurance
made no distribution to the individual state employees and
retirees under the 1999 group policy.
time of the demutualization, the state received notice
thereof and was given the option to receive its share of the
proceeds in stock or cash. There is no evidence that
individual enrollees in the 1999 group policy received notice
of the demutualization. However, public hearings concerning
the demutualization were held before the Indiana Department
January, 2002, the named plaintiff, Ronald Gold, a state
employee, brought this action on his own behalf and on behalf
of all others similarly situated, against the defendants,
former Governor Rowland, the state, Anthem, Inc., New
CT-Blue, Anthem East, Inc., and Anthem
Insurance. Gold initially filed a two count inter
pleader action alleging that, pursuant to the plan of
conversion, he and other similarly situated state employees
enrolled in the 1999 group policy were entitled to receive
the 1.6 million shares of Anthem, Inc., stock that the
insurance company defendants had issued to the state. In a
second amended complaint, Gold claimed a right to the funds
under various theories sounding in unjust enrichment,
constructive trust, resulting trust, conversion of property,
breach of duty, and unconstitutional takings and procedural
due process violations.
former Governor Rowland and the state filed a motion to
dismiss Gold's claims against them, arguing, among other
things, that the claims were barred by the doctrine of
sovereign immunity. The trial court, Sheldon,
J., concluded that Gold's common-law claims were
barred by sovereign immunity and dismissed those claims.
However, the court denied the motion to dismiss Gold's
inter pleader and state constitutional takings claims. On
appeal, this court concluded that all of Gold's claims
against former Governor Rowland and the state should have
been dismissed. See id., 223.
the return of the case to the Superior Court, Gold filed the
operative fourth amended com-plaint,  and Lois O'Connor, a
former state employee who retired in 1997, was added as a
plaintiff. In 2011, the case was assigned to the court,
Bright, J. Class certification was granted to the
group of state employees and retirees who continuously held a
certificate of coverage under the 1999 group policy or who
had continuous health care insurance coverage under that
policy during the eligibility period but did not receive
compensation as a result of the demutualization.
2013, the plaintiffs and the insurance company defendants
filed separate motions for summary judgment, each side
claiming that the contract documents that governed the
demutualization process and Anthem Insurance's
relationship with the state and state employees required that
judgment as a matter of law be rendered in their favor. The
court denied the motions, concluding that the contract
language regarding the distribution of demutualization
proceeds was ambiguous and, therefore, that it was necessary to
consult extrinsic evidence of the parties' intent, and
that there were genuine issues of material fact that needed
to be resolved at trial.
court bifurcated the proceedings, and the case proceeded to
trial before the court solely on the issue of liability. The
court heard testimony from a number of attorneys and other
witnesses who were involved with the transactions at issue.
Following the trial, the court issued a thoughtful and
comprehensive memorandum of decision in which it concluded
that (1) the various merger documents were all part and
parcel of the same transaction, (2) when construed together,
those documents are ambiguous with respect to the
plaintiffs' entitlement to membership in Anthem Insurance
and a share of the demutualization proceeds, and (3) the
extrinsic evidence conclusively supported the insurance
company defendants' interpretation of the merger
documents, pursuant to which the state, rather than the
plaintiffs, was the member entitled to the group's share
of the demutualization proceeds. Consistent with these
conclusions, the trial court rendered judgment in favor of
the insurance company defendants.
plaintiffs timely appealed to the Appellate Court, and we
transferred the appeal to this court pursuant to General
Statutes § 51-199 (c) and Practice Book § 65-1. On
appeal, the plaintiffs contend that the 1997 articles
unambiguously entitled them to the demutualization proceeds
arising from the 1999 group policy and that the trial court
improperly considered extrinsic evidence of the meaning of
the relevant contract provisions. Consistent with this
contention, they further claim that they are entitled to
judgment as a matter of law. Additional facts will be set
forth as necessary.
begin our analysis of the plaintiffs' claim by setting
forth the standard of review and governing legal principles.
‘‘When the language of a contract is ambiguous,
the determination of the parties' intent is a question of
fact . . . . [When] there is definitive contract language,
[however] the determination of what the parties intended by
their contractual commitments is a question of law. . . . It
is implicit in this rule that the determination as to whether
contractual language is plain and unambiguous is itself a
question of law subject to plenary
review.'' (Citations omitted; internal quotation
marks omitted.) Cruz v. Visual Perceptions,
LLC, 311 Conn. 93, 101-102, 84 A.3d 828 (2014).
the parties have agreed that Indiana law governs the 1997
articles and other documents at issue in this case, we apply
the law of that state. See, e.g., Hottle v. BDO
Seidman, LLP, 268 Conn. 694, 706, 846 A.2d 862 (2004).
Under Indiana law, ‘‘[t]he ultimate goal of any
contract interpretation is to determine the intent of the
parties at the time that they made the agreement. . . .
[Indiana courts] begin with the plain language of the
contract, reading it in context and, whenever possible,
construing it so as to render each word, phrase, and term
meaningful, unambiguous, and harmonious with the
whole.'' (Citation omitted.) Citi Mortgage,
Inc. v. Barabas, 975 N.E.2d 805, 813
(Ind. 2012). ‘‘Unless the terms of a contract are
ambiguous, they will be given their plain and ordinary
meaning.'' Centennial Mortgage, Inc.
v. Blumenfeld, 745 N.E.2d 268, 273-74 (Ind.
contract is ambiguous if a reasonable person would find the
contract subject to more than one interpretation.''
(Internal quotation marks omitted.) Citi-Mortgage,
Inc. v. Barabas, supra, 975 N.E.2d
813. ‘‘The terms of a contract are not ambiguous
merely because controversy exists between the parties
concerning the proper interpretation of terms.''
Centennial Mortgage, Inc. v.
Blumenfeld, supra, 745 N.E.2d 274.
[a court] find[s] ambiguous terms or provisions in the
contract, [it] will construe them to determine and give
effect to the intent of the parties at the time they entered
into the contract.'' (Internal quotation marks
omitted.) Citi Mortgage, Inc. v.
Barabas, supra, 975 N.E.2d 813. ‘‘If . .
. any terms of a [contract] are ambiguous, then the parties
may introduce extrinsic evidence of its meaning, and
interpretation of that term becomes a question of fact . . .
.'' Beradi v. Hardware
Wholesalers, Inc., 625 N.E.2d 1259, 1261 (Ind. App.
1993). In such case, the finder of fact may consider any
relevant extrinsic evidence of the parties' intent. See
University of Southern Indiana Foundation v.
Baker, 843 N.E.2d 528, 535 (Ind. 2006). This
includes the circumstances surrounding the drafting of the
agreement; see Grant v. North River Ins.
Co., 453 F.Supp. 1361, 1366 (N.D. Ind. 1978); statements
made between the parties; see Washburn-Crosby Milling
Co. v. Brown, 56 Ind.App. 104, 109,
104 N.E. 997 (1914); testimony or affidavits from attorneys
who drafted the agreement; see University of Southern
Indiana Foundation v. Baker, supra, 535; the
conduct of the parties to the contract after it was formed;
see Peterson v. First State Bank, 737
N.E.2d 1226, 1229-30 (Ind. App. 2000); Pierce
v. Yochum, 164 Ind.App. 443, 451, 330
N.E.2d 102 (1975); and subsequently prepared documents that
reflect the parties' courseof performance. See Tender
Loving Care Management, Inc. v.
Sherls, 14 N.E.3d 67, 72-73 (Ind. App. 2014).
event that review of extrinsic evidence of the parties'
intent fails to resolve a contractual ambiguity, Indiana
courts then apply the doctrine of contra profer-entem,
pursuant to which such ambiguities are construed against the
drafter. See Indiana-Kentucky Electric Corp.
v. Green, 476 N.E.2d 141, 146 (Ind. App.
1985). This doctrine is used only as a tie breaker, however,
after all other rules of construction have been applied and
all indicia of the parties' intent have been exhausted.
See id.; see also Bradley v. Western
& Southern Financial Group, Docket No. 2:05 CV 39,
2005 WL 2709282, *7 (N.D. Ind. October 20, 2005)
(‘‘the application of contra proferentem is
premature in situations [in which] there has not yet been any
attempt to resolve the ambiguity through the ordinary
interpretive guides-namely, a consideration of the extrinsic
evidence'' [internal quotation marks omitted]);
Bradley v. Western & Southern Financial
Group, supra, *7 (explaining that, if doctrine of contra
proferentem were applied at outset upon finding of ambiguity,
then rule allowing for consideration of extrinsic evidence to
interpret ambiguous contracts would be meaningless).
is black letter law that ‘‘a contract is
considered as a whole so as to give effect to all its
provisions without narrowly concentrating [on] some clause or
language taken out of context.'' Keystone Square
Shopping Center Co. v. Marsh Supermarkets,
Inc., 459 N.E.2d 420, 422 (Ind. App. 1984). In addition,
documents that are part of the ‘‘same transaction
or subject matter will be construed together in determining
the intent underlying the contracts.'' Noble
Roman's, Inc. v. Ward, 760 N.E.2d
1132, 1138 (Ind. App. 2002); see also State ex rel. Keith
v. Common Council, 138 Ind. 455, 461, 37 N.E.
1041 (1894) (contemporaneous writings so interrelated as to
be deemed ‘‘ ‘part and parcel of the same
contract' '' may be read as one); Salcedo
v. Toepp, 696 N.E.2d 426, 435 (Ind. App. 1998)
(‘‘[i]n the absence of anything to indicate a
contrary intention, writings executed at the same time and
relating to the same transaction [or subject matter] will be
construed together in determining the contract'').
‘‘Moreover, [as] long as two or more instruments
are part of the same transaction, different execution times
will not prohibit [the] instruments from being construed
together.'' Centennial Mortgage, Inc.
v. Blumenfeld, supra, 745 N.E.2d 275; see
also Gold v. Cedarview Management Corp.,
950 N.E.2d 739, 743 (Ind. App. 2011). The contemporaneous
document doctrine may even beapplied when the documents at
issue involve different parties, although caution must be
exercised under those circumstances, and the determination
that the documents constitute a sin- gle agreement must be
made on a case-by-case basis. Compare Lily, Inc.
v. Silco, LLC, 997 N.E.2d 1055, 1068-69
(Ind. App. 2013) (applying doctrine even though only one
entity was party to all three agreements at issue), transfer
denied, 6 N.E.3d 950 (Ind. 2014), and Roberts v.
Vonnegut, 58 Ind.App. 142, 146-49, 104 N.E. 321
(1914) (construing contract executed between
corporation's principal shareholders together with
creditors' extension agreement), with Yessenow
v. Hudson, Docket No. 2:08-CV-353 (PPS), 2012
WL 2990643, *6-*7 (N.D. Ind. July 19, 2012) (declining to
apply contemporaneous document doctrine when indemnification
agreement at issue contained integration clause, was signed
on different date than merger documents were, and was not
necessary condition of completing merger), and Murat
v. South Bend Lodge No. 235 of the Benevolent &
Protective Order of Elks, 893 N.E.2d 753, 757-58 (Ind.
App. 2008) (declining to apply contemporaneous document
doctrine because deeds at issue served different purposes and
did not cross-reference each other, and there was no evidence
that parties intended them to form unitary contract),
transfer denied, 915 N.E.2d 989 (Ind. 2009); see also
Beradi v. Hardware Wholesalers, Inc.,
supra, 625 N.E.2d 1261-63 (construing together documents
signed by various corporate officers in both their individual
and representative capacities); Gilmore v.
Century Bank & Trust Co., 20 Mass.App. 49, 56,
477 N.E.2d 1069 (1985) (factors influencing whether different
instruments should be read together as components of single
transaction include ‘‘simultaneity of execution,
identity of subject matter and parties, cross-referencing,
and interdependency of provisions'').
courts have applied these principles in the context of
construing articles of incorporation in tandem with other
corporate organizational documents. See, e.g., Bay Colony
Civic Corp. v. Pearl Gasper Trust, 984
N.E.2d 231, 235 (Ind. App. 2013); Heritage Lake Property
Owners Assn., Inc. v. York, 859 N.E.2d
763, 765-66 (Ind. App. 2007); National Board of Examiners
for Osteopathic Physicians & Surgeons, Inc.
v. American Osteopathic Assn., 645 N.E.2d
608, 617 (Ind. App. 1994). This reflects the principle that
‘‘[t]he relation between a corporation and its
stockholders is one of contract in which the articles of
incorporation, [bylaws], provisions of the stock certificate,
and pertinent statutes are embodied.''Scott
v. Anderson Newspapers, Inc., 477 N.E.2d 553,
558 (Ind. App. 1985).
these principles in mind, we turn our attention to the
present dispute. The plaintiffs argue that (1) the 1997
articles represent the entirety of the relevant agreement,
and (2) those articles unambiguously provide that the
plaintiffs were members of Anthem Insurance who were entitled
to a share of the demutualization proceeds. Because the
relevant contractual language is unambiguous, the plaintiffs
further contend, the trial court improperly considered
extrinsic evidence of the parties' intent. The insurance
company defendants respond that the relevant agreement
encompasses not only the 1997 articles but also the other
merger documents. The insurance company defendants further
maintain that the 1997 articles, both standing alone and when
read in conjunction with the other merger documents, are
ambiguous with respect to the plaintiffs' membership
status and entitlement to demutualization proceeds. The
insurance company defendants therefore contend that the trial
court properly looked to extrinsic evidence to resolve this
agree with the insurance company defendants that the 1997
articles and the other merger documents are part and parcel
of the same transaction and that, when read together, they
are ambiguous as to the plaintiffs' eligibility for
membership in Anthem Insurance and their entitlement to a
share of the demutualization proceeds relating to the 1999
group policy. Accordingly, we conclude that the trial
court properly consulted extrinsic evidence of their meaning.
the Merger Documents Were Part and Parcel of a Single
first consider whether the trial court correctly concluded
that the 1997 articles were ‘‘part and parcel of
the merger transaction'' and, therefore, that it was
appropriate to construe those articles in tandem with the
other merger documents. As we previously noted, Indiana
courts consider a number of factors when applying the
contemporaneous document doctrine. These include (1) whether
the documents were executed at the same time and by the same
parties, (2) whether they address the same matter or
transaction, (3) whether they reference or incorporate one
another, (4) whether the execution of each document or
fulfillment of the promises contained therein is a
precondition for that of the others, and (5) whether the
documents purport on their face to be fully integrated
agreements. In the present case, most if not all of these
factors favor construing the 1997 articles and the other
merger documents as components of a single agreement.
there is little doubt that the 1997 articles and the other
merger documents all were drafted in conjunction with the
same transaction, namely, the 1997 merger between Anthem
Insurance and Blue Cross. Indeed, the plaintiffs concede as
much in their primary appellate brief: ‘‘In
connection with the proposed merger, [Anthem
Insurance's] attorney . . . drafted the agreement to
merge . . . the plan and joint agreement of merger . . . the
guaranty policies . . . and the  . . . articles . . .
.'' (Citations omitted; emphasis added.) Notably, the
plaintiffs also acknowledge that the membership rules
contained in Anthem Insurance's existing articles of
incorporation needed to be revised in order to facilitate the
merger with Blue Cross.
the 1997 articles and the other merger documents contain
multiple references to each other. Section 7.6 (b) of the
1997 articles provides in relevant part that, following a
merger, former members of a qualified mutual insurer shall
‘‘become members of [Anthem Insurance] pursuant
to, and shall be entitled to receive guaranty insurance
policies/membership certificates . . . . Each such guaranty
insurance policy/membership certificate shall continue in
effect and confer membership and other rights . . .
.'' Section 8.5 then lays out the
‘‘[r]ights of [m]embers with [g]uaranty
[p]oli-cies'' in the event that Anthem Insurance were
ever to demutualize. That section provides in relevant part:
‘‘Any member of [Anthem Insurance] who has an
individual guaranty insurance policy of [Anthem Insurance] or
a certificate of membership issued under a group guaranty
insurance policy . . . shall be entitled, upon any . . .
demutualization . . . of [Anthem Insurance] . . . to
distributions in the form of cash, securities or other
assets, and other membership and other rights and privileges
. . . .'' It is clear, then, that the 1997 articles
envision that guaranty policies, such as those that were
attached to the agreement to merge and subsequently provided
to Blue Cross members, are the mechanism by which Blue Cross
group policyholders were converted into members of the merged
entity and invested with proprietary rights in the event of a