In Re William J. French, et al.

In 1996 Congress enacted Internal Revenue Code (“Code”) Subchapter C—Long-Term Care Services and Contracts, which entitles purchasers of Qualified Long-Term Care Insurance (“QLTCI”) Contracts to receive federal income tax benefits if their contracts comply with the Code. To prevent economic discrimi­ nation against QLTCI policyowners, the Code limits an issuer to one QLTCI policyowner class. In violation of that term, Defendants below (“NML”) created numerous classes and used, and continues to use, them to profit from discriminatory rate increases it imposed on its QLTCI policyowners. Petitioners detailed these facts and the governing law in a Motion for Partial Summary Judgment (“PSJ Mo­ tion”) filed on July 15, 2021. In response, on July 21, 2021, NML filed a motion to hold the PSJ Motion in abeyance (“Abeyance Motion”). Two days later, on July 23, the court granted the Abeyance Motion, de­ nied and dismissed the PSJ Motion sua sponte and without decision, and prohibited Petitioners from fil­ ing a similar dispositive motion until it decided a pending dilatory motion previously filed by NML. The question presented is whether the District Court exceeded its authority and clearly abused its discre­ tion by ordering that the PSJ Motion, which confirms that NML’s Scheme invalidated its purported QLTCI Contracts, be denied and dismissed, permitting the Scheme to continue undisturbed.