IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO DANNIE FAIL, SCOTT BUCHHOLZ, CHRISTIAN ANDERSONN, JOHN ZONTA,

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1 Civil Action Number: IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO DANNIE FAIL, SCOTT BUCHHOLZ, CHRISTIAN ANDERSONN, JOHN ZONTA, STACEY TRUAX, TIMOTHY MELSON, SCOTT PHILBRICK, JEDADIAH ZILLMER Plaintiffs, vs. THE UNITED STATES OF AMERICA, Defendant COMPLAINT AND JURY DEMAND COME NOW Plaintiffs FAIL, BUCHHOLZ, ANDERSON, ZONTA, TRUAX, MELSON, PHILBRICK, ZILLMER, by and through their attorneys William Muhr and Associates and L. Dan Rector, and allege as follows: I. INTRODUCTION AND JURISDICTION 1. Plaintiffs DANNIE FAIL, SCOTT BUCHHOLZ, CHRISTIAN ANDERSONN, JOHN ZONTA, STACEY TRUAX, TIMOTHY MELSON, SCOTT PHILBRICK, and JEDADIAH ZILLMER are citizens of the United States and served in the United States Army at all times pertinent hereto.

2 2. This is an action in contract for disability benefits that the United States Army failed to provide to FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER under the terms of the Servicemembers Group Life Insurance Traumatic Injury Protection Program (hereafter TGSLI ). 3. The Defendant is the United States of America, acting by and through the Department of the Army, an agency of the United States government. 4. FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER brings this action against Defendant The United States of America based upon a failure of the United States Department of Army (hereafter Army or the Defendant) to pay benefits owed to FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER under the TGSLI program. 5. This Court has jurisdiction over the parties under 38 USC 1975, as well as under the terms of the TSGLI program, as any member who receives an adverse TSGLI decision may obtain judicial review in any United States District Court of competent jurisdiction. 6. In addition, even if administrative reviews were required of TSGLI applicants prior to initiating a lawsuit, doing so would be futile because it is certain that a TSGLI claim will be summarily denied on appeal for the reasons stated herein. 7. Venue is proper in this district because the Plaintiffs are a resident of the State of Colorado. II. FACTUAL ALLEGATIONS 8. All allegations contained in the previous paragraphs are incorporated herein by reference.

3 9. The Servicemembers Group Life Insurance Traumatic Injury Protection Program, also known as TSGLI, is a rider to the SGLI policy that provides a payment for service members injured as the result of a traumatic event. 10. TSGLI coverage was added to SGLI policies effective December 1, After Dec. 1, 2005, all service members covered by SGLI are eligible for TSGLI coverage, regardless of where their qualifying traumatic injury occurred. In addition, a retroactive program that covers service members who sustained a qualifying traumatic injury while supporting Operation Enduring Freedom (OEF), Operation Iraqi Freedom (OIF), or while on orders in a Combat Zone Tax Exclusion (CZTE) area from Oct. 7, 2001, through Nov. 30, For service members who suffer a qualifying loss as a result of a traumatic injury event, the Defendant will pay between $25,000 and $100,000, depending on the severity of the qualifying loss. 12. The benefit is paid to the member, someone acting on the member s behalf if the member is incompetent, or the members SGLI beneficiary if the member is deceased. 13. All members covered under SGLI who experienced a traumatic event that directly results in a traumatic injury causing a scheduled loss defined under the program are eligible for TSGLI payment. 14. Losses must meet the TSGLI standard in order to be eligible for a benefit payment. There are 9 categories of losses covered as follows: 1) Sensory Losses 2) Burns 3) Paralysis 4) Amputation

4 5) Limb Salvage 6) Facial Reconstruction 7) Activities of Daily Living 8) Inpatient Hospitalization 9) Coma/TBI combined with another injury 15. If a member submits an application for benefits, a medical professional must sign a Part B form to certify the medical information provided. In so doing, a medical professional certifies that the applicant meets the TSGLI criteria stated above. In FAIL S case, one medical professional certified his individual claim. In BUCHHOLZ S case, one medical professional certified his individual claim. In ANDERSONN S case, one medical professional certified his individual claim. In ZONTA S case, one medical professional certified his individual claim. In TRUAX S case, one medical professional certified his individual claim. In MELSON S case, one medical professional certified his individual claim. In PHILBRICK S case, one medical professional certified his individual claim. In ZILLMER S case, one medical professional certified his individual claim. 16. At all times pertinent hereto, FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER was eligible for TSGLI benefits through his status as a servicemember of the Army. 17. FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER were diagnosed with traumatic injuries that entitled each individual named to benefits under the Schedule of Benefits, insofar as, FAIL,

5 BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER met the guidelines for a TSGLI claim based upon multiple coverage criteria pursuant to a traumatic injury that occurred: 18. On or about January 31, 2012, FAIL submitted an application for TSGLI indicating that FAIL met the criteria for TSGLI benefits. On or about October 6, 2011, BUCHHOLZ submitted an application for TSGLI indicating that BUCHHOLZ met the criteria for TSGLI benefits. On or about August/September 2011, ANDERSONN submitted an application for TSGLI benefits, supported then and thereafter by a Part B form signed by medical professionals, indicating that ANDERSONN met the criteria for TSGLI benefits. On or about May 6, 2011, ZONTA submitted an application for TSGLI benefits, supported then and thereafter by a Part B form signed by medical professionals, indicating that ZONTA met the criteria for TSGLI benefits. On or about March 30, 2011, TRUAX submitted an application for TSGLI indicating that TRUAX met the criteria for TSGLI benefits. On or about July/August 2011, MELSON submitted an application for TSGLI indicating that MELSON met the criteria for TSGLI benefits.

6 On or about November 2011, PHILBRICK submitted an application for TSGLI indicating that PHILBRICK met the criteria for TSGLI benefits. On or about June 29, 2011, ZILLMER submitted an application for TSGLI indicating that ZILLMER met the criteria for TSGLI benefits. 19. Thereafter, FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER received a letter denying them benefits, stating that each did not meet the standards for loss of under the TSGLI Schedule of Losses. 20. The defendant has standardized the practices of denying claims in a manner that is arbitrary, unsupported by its own guidelines, and contrary to law. 21. The defendant has uniformly denied FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER s claim for TSGLI benefits because, among other reasons, it adds a criterion negating ADL coverage where there can be adaptive behavior to accomplish the activity, even though the adaptive standard is not contained in the manual or guidelines. 22. The defendant systemically and regularly fails to certify claims for benefits even though the Plaintiff(s) met the contractual and legal criteria with respective individual application. 23. The defendant is uniformly violating its own guidelines for denying claims by failing to provide Loss Codes or otherwise adequately advise the applicant of the reason for a denial. The defendant is violating its own procedures by failing to notify claimants of their right to pursue legal remedy in Federal Court.

7 24. FAIL, BUCHHOLZ, ANDERSONN, ZONTA, TRUAX, MELSON, PHILBRICK, and ZILLMER has suffered damages in the form of denial of proscribed benefits due under the TSGLI the following claims for relief are presented. III. CLAIMS FOR RELIEF 25. All allegations contained in the previous paragraphs are incorporated herein by reference. 26. The Plaintiffs herein asserts claims for breach of contract that include: a. Failing to pay benefits under the TSGLI program, as outlined elsewhere herein; b. Failing to identify reasons under the applicable guidelines, including omission of loss codes or adequate information upon which decisions are made; c. Adding additional unauthorized criteria for TSGLI claims. IV. PRAYER FOR RELIEF WHEREFORE, the Plaintiffs pray that this Court award the following relief: a. Award Plaintiffs contractual benefits that are formulaic in nature in an amount to be determined by the court; b. Award Plaintiffs interest, costs, and attorneys fees, as provided by statute. c. Award Attorney fees as provides by statute and code, including under The Equal Access to Justice Act, 5 U.S.C. 504; 28 U.S.C d. Grant such other relief as the Court deems just and proper. Plaintiff(s) request a trial on all allegations named Respectfully submitted, By: /s/ L. Dan Rector L. Dan Rector, Atty. No. 7568

8 L. Dan Rector, Attorney at Law 217 E. Fillmore St. Colorado Springs, CO (719) Kim Everette, Atty. No William Muhr, Attorneys & Counselors at Law, LLP Attorney for the Plaintiffs 7035 Campus Park Drive Colorado Springs, CO Phone Number: (719) FAX Number: (719) Plaintiff s address: DANNIE FAIL 3914 N Academy Blvd Apt 308 Colorado Springs, CO SCOTT BUCHHOLZ 123 Mayhaw St Deridder, LA70634 CHRISTIAN ANDERSONN 7132 Landmark Dr Springhill, FL JOHN ZONTA 6270 Portage Rd De Forest, WI STACEY TRUAX 1014 Prairie Ridge Trail Pflugerville, TX TIMOTHY MELSON 765 Golden Eagle Drive Conway, SC SCOTT PHILBRICK 3835 NE Park Drive Kansas City, MO JEDADIAH ZILLMER 1607 N. Regal Street

9 Spokane, WA 99207