Halloum v. Black diamond/federal Insurance Co

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

AMMAR HALLOUM, Petitioner,

v.

THE INDUSTRIAL COMMISSION OF ARIZONA, Respondent,

BLACK DIAMOND NETWORKS LLC, Respondent Employer,

FEDERAL INSURANCE CO, Respondent Carrier.

No. 1 CA-IC 26-0009
FILED 09-10-2026

Special Action - Industrial Commission
ICA Claim No. 20233470497
Carrier Claim No. 40523050481
The Honorable Rachel C. Morgan, Administrative Law Judge

AFFIRMED

COUNSEL

Ammar Joe Halloum, Mesa
Petitioner

Industrial Commission of Arizona, Phoenix
By Afshan Peimani
Counsel for Respondent

Ritsema Law, Phoenix
By Meghann E. Fawcett
Counsel for Respondent Employer and Insurance Carrier

MEMORANDUM DECISION

Judge James B. Morse Jr. delivered the decision of the Court, in which
Presiding Judge Andrew J. Becke and Judge Samuel A. Thumma1 joined.

M O R S E, Judge:

¶1 The Industrial Commission of Arizona ("ICA") found Ammar
Halloum failed to prove claims of bad faith and unfair claim processing.
For the reasons below, we affirm.

FACTS AND PROCEDURAL BACKGROUND

¶2 Halloum was injured at work when he fell headfirst into a
gate at the bottom of some stairs. The facts and history relevant to
compensability are set forth in Halloum v. Industrial Commission, 1 CA-IC 25-
0006, 2026 WL 195718 (Ariz. App. Jan. 26, 2026) (mem. decision). A security
camera captured the event. He filed a workers' compensation claim which
the ICA found to be non-compensable because the fall was intentional. In
a prior special action, we affirmed. Id. at *2, ¶ 12.

¶3 Along with his claim for compensation, Halloum filed claims
of bad faith and unfair claim processing concerning the handling of his
compensation claim by his employer Black Diamond Networks, LLC, and
its carrier Federal Insurance Co. (collectively "respondents"). Among other
things, Halloum alleges that respondents failed to investigate the claim
adequately and accept or deny the claim in a timely manner. We view the

1 Judge Samuel A. Thumma was on the panel assigned to this case
until retiring effective August 28, 2026. Arizona Supreme Court Chief
Justice Ann A. Scott Timmer appointed Judge Thumma to continue to serve
on the Court through December 31, 2026 to resolve those cases in which he
previously participated, like this case. See Arizona Supreme Court
Administrative Order 2026-124.

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evidence in the light most favorable to upholding an award. Avila v. Indus.
Comm'n, 219 Ariz. 56, 57, ¶ 2 (App. 2008).

¶4 After his fall on November 29, 2023, Halloum was taken by
ambulance to an emergency room and later admitted to the hospital for
observation. He was hospitalized and then in a rehabilitation facility until
December 15, 2023, when he was discharged to his home.

¶5 On December 11, 2023, his wife filed an injury report with the
ICA seeking compensation for Halloum and using a signature line stating:
"not able to sign due to medical condition." On December 14, 2023, the ICA
claims division asked for resubmission of the claim because it required a
signature and the employer's complete business address. Meanwhile, on
December 11, 2023, Black Diamond filed an employer's injury report, noting
"[i]nsufficient [i]nfo" to identify the injury or the part of the body injured.
On December 18, 2023, Halloum filed another injury report, this time signed
by his wife. The report stated, "I was told that my husband Ammar Joe
Halloum fell [off] the stairs and hit his head . . . ." On January 3, 2024, the
ICA sent notice of the claim to the carrier.

¶6 Apart from this formal contact with the ICA, on December 8,
2023, Halloum's wife emailed Black Diamond's Human Resources ("HR")
asking if Halloum's medical care would be covered by workers'
compensation. HR responded on December 11, 2023, giving her the
insurance policy number and letting her know the hospital had been given
the same information. On December 12, 2023, the carrier's third-party
claims administrator copied Halloum's wife on an email that provided a
claim number and the name and phone number of the assigned claims
adjustor.2 The email also provided an email address to send relevant
documents (the "correct claims email").

¶7 Halloum's wife then began emailing materials to a different
email address than provided to her on December 12, 2023 (the "incorrect
claims email"). Halloum later said the claims administrator gave his wife
the incorrect claims email when she called the claims administrator. She
continued to email the incorrect claims email through the end of December
2023.

¶8 In the meantime, the carrier's private investigator tried to get
a release for Halloum's medical records to investigate the claim. She

2 Hereinafter, this decision refers to both the administrator and the
carrier as "carrier" unless clarity requires distinction.

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contacted the Halloums by phone and email, offering to come to their house
to help fill out and sign the necessary paperwork. The Halloums declined
to meet with the investigator because, as Halloum later testified, they did
not know her and did not "know if she [was] an impostor."

¶9 On January 2, 2024, Halloum's wife began emailing materials
to the correct claims email. Her email asked whether the carrier sent the
investigator and whether this was the proper process. As noted above, the
ICA sent notice of the claim to the carrier on January 3, 2024. This triggered
the statutory 21-day deadline for the carrier to accept or deny the claim. See
A.R.S. § 23-1061(M) (requiring generally if a carrier does not accept or deny
a claim within 21 days of official notice by the ICA, the carrier must
immediately pay compensation as if the claim is accepted until it issues a
denial notice).

¶10 On January 8, 2024, an in-house investigator named David
emailed the Halloums saying the third-party investigator had been trying
to reach them to get a medical-record authorization. The email listed
David's email address in several places. The earliest response to David in
the record is an email from Halloum's wife dated January 17, 2024.
Halloum's wife responded to David's email by emailing the correct claims
email but did not email David's email address. This email purports to
respond to a voice mail "Dave" left saying that Halloum's wife needed to
sign a medical-record release. In the email, Halloum's wife asked him to
"mail" her the form, which she would sign and "mail" back to him. She
asked him to fill out as much of the form as he could for her. She also
continued to complain that the adjustor was not replying to her emails.
Finally, Halloum's wife acknowledged she had received "messages" from
the third-party investigator, but she noted the investigator did not have a
"prior referral" from the carrier and "did not specify" the forms she wanted
Halloum's wife to sign.

¶11 The final email in the record is an email from Halloum's wife
dated January 30, 2024, addressed to both the incorrect and correct claims
emails but not David's email address. She said she had not received the
form to sign or a reply to her January 17 email. She also noted there had
been no "worker's compensation" payments sent. She said she was left with
no choice but to hire an attorney.

¶12 On February 2, 2024, Halloum filed a complaint alleging bad
faith and unfair claim processing under A.R.S. § 23-930 ("unfair processing"
claim). The same day, he filed a request for investigation of unpaid benefits
under A.R.S. § 23-1061(J) ("(J) investigation request").

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¶13 On February 12, 2024, 40 days after receiving the notice of the
claim, respondents issued a notice-of-claim status denying the claim
without notation. Halloum requested a hearing to challenge the denial. At
that point, the ICA had already set a hearing for April 2024 to consider
Halloum's unfair processing claim and (J) investigation request. While
preparing for the hearing, the parties disagreed about whether to
consolidate the compensability hearing with the other claims. On April 1,
2024, respondents paid Halloum the A.R.S. § 23-1061(M) penalty, paying
him compensation as if the claim had been accepted from January 3, 2024,
through February 12, 2024. The hearing date was moved to July 2024.

¶14 At the start of the hearing in July 2024, the ALJ noted the
unfair processing claim and (J) investigation request "ha[d] been resolved
because the [respondents] paid the penalty benefits, and so the only issue
before me is the compensability of the claim." Halloum was present and
represented by counsel. No party objected to the ALJ's characterization,
and the hearing addressed only the compensability issue.

¶15 After the ALJ denied compensability and affirmed the denial
on review in March 2025, the claims division issued a decision in May 2025
stating it had investigated the unfair processing claim filed February 2024
and found no grounds supporting the claim. Halloum, who was now
representing himself, filed a timely request for a hearing. The ICA then
held a hearing at which only Halloum testified.

¶16 Halloum testified that his memory about the timing of the
events was not good. His wife had been acting for him during December
2023 and January 2024 because he was not mentally able to do so. He
acknowledged receiving the December email providing the contact
information and identities of the carrier and the adjustor. He insisted that
someone at the carrier gave his wife the incorrect claims email over the
phone. That was the address his wife emailed until early January, when
she began emailing the correct claims email. He acknowledged he received
text messages in early January from the third-party investigator. He also
acknowledged he did not sign a medical-records release until mid-February
and that respondents did not have his medical records until late February.
He also testified he had no outstanding bills for medical services between
January 3, 2024 and February 12, 2024.

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¶17 The parties filed post-hearing memoranda arguing their
respective positions.3 Halloum argued many failures by respondents,
including failure to investigate the claim promptly before denying it, failure
to cover his medical expenses from December 8, 2023, through January 12,
2024, and "untimely claim denial." Respondents' memorandum contended
the carrier had made reasonable efforts to obtain medical records and
particularly noted the untimely denial had already been addressed with the
payment of the penalty under A.R.S. § 23-1061(M).

¶18 The ALJ was not persuaded respondents had committed bad
faith or unfair claim processing. She found the carrier "exercised due
diligence" and "attempted to obtain a signed medical authorization," the
third-party investigator "properly identified" herself, and Halloum "did not
fully cooperate." She also found the untimely denial of compensability had
been properly addressed by the penalty payment, the carrier had not
intentionally misled Halloum, and there was no unreasonable delay in
processing the claim. Thus, the ALJ denied Halloum's complaints. After
Halloum timely requested administrative review, the ALJ affirmed denial
of the claim.

¶19 Halloum then brought this statutory special action review.
We have jurisdiction under A.R.S. §§ 12-120.21(B) and 23-951(A).

DISCUSSION

¶20 Halloum makes many contentions in his opening brief.4 One
contention concerns medical evidence that was relevant to the

3 Halloum did not cite or invoke his (J) investigation request at the
hearing or in his post-hearing argument, so we consider that claim
abandoned and waived on appeal. Stephens v. Indus. Comm'n, 114 Ariz. 92,
94 (App. 1977) (holding this Court will not consider on review an issue not
raised to the ICA when there was opportunity to do so).

4 We grant in part respondents' motion to strike Halloum's reply brief
because it contains portions not responsive to the answering brief. See
ARCAP 13(c) (confining the reply brief to rebuttal of the answering brief).
The section entitled "Point-By-Point Response to Respondents' Arguments"
begins on page 16 of the reply brief. Before and after that section, Halloum
restates arguments from the opening brief. We therefore strike the reply
brief except for the point-by-point response section, leaving pages 16
through 28 of the reply brief for our consideration. Sholes v. Fernando, 228

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compensability hearing but is not relevant here. Another reargues a ruling
by the Chief ALJ denying his motion for a change of judge. That order is
not on review here. Halloum also raises factual arguments to support
claims that fall outside the legal definitions of bad faith and unfair claim
processing as defined in Ariz. Admin. Code ("A.A.C.") R20-5-128. The
majority of Halloum's contentions are simply re-arguments of the facts,
urging this Court for a different factual outcome. But we do not weigh or
re-weigh evidence. Lawless v. Indus. Comm'n, 260 Ariz. 64, 70, ¶ 27 (App.
2025).

¶21 The ICA defined unfair claim processing and bad faith under
A.A.C. R20-5-128. See A.R.S. § 23-930(E) (requiring that an ICA rule must
define those terms). Bad faith includes unreasonably delaying benefit
payments or treatment authorization, unreasonably underpaying or
terminating benefits, and intentionally misleading a claimant about
workers' compensation law. A.A.C. R20-5-128(A)(2)–(5). Unfair claim
processing practices include issuing a notice-of-claim status without
adequate supporting information, unreasonably failing to acknowledge
communications from a claimant, and failing to act reasonably and
promptly upon receiving communications from a claimant. A.A.C. R20-5-
128(B)(1)–(3).5 These rules promote one of the purposes of the workers'
compensation system: providing expeditious compensation. Special Events
Serv., Inc. v. Indus. Comm'n, 228 Ariz. 332, 335–36, ¶ 13 (App. 2011).

¶22 Halloum had the burden of proving his claims. Spears v.
Indus. Comm'n, 20 Ariz. App. 406, 407 (1973). To prevail under a claim of
bad faith, he must show respondents unreasonably delayed, terminated, or
underpaid his benefits. These circumstances each require a compensable
claim. Because Halloum neither received nor was entitled to compensation
benefits, he could not legally show bad faith.

Ariz. 455, 457, ¶ 2 n.2 (App. 2011) (holding this Court may disregard
portions of brief not compliant with ARCAP 13).
We also have not considered the documents in the "appendix" to the
reply brief because they are not stamped as having been received by the
ICA. We confine our review to the hearing record. See A.R.S. § 23-943(E)
(limiting the ALJ's administrative review to the hearing record); Israel v.
Indus. Comm'n, 137 Ariz. 124, 127 (App. 1983) (holding this Court may only
review matters that the ALJ could consider on administrative review).

5 The other definitions in A.A.C. R20-5-128(A) and (B) do not apply to
Halloum’s circumstances.

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¶23 To prevail under a claim of unfair claim processing, Halloum
needed to show that the denial notice lacked adequate supporting
information, that respondents unreasonably failed to acknowledge
communication from him or the ICA, or that respondents failed to
reasonably and promptly respond to communications from the ICA or
Halloum. A.A.C. R20-5-128(B)(1)–(3). Any other allegation by Halloum is
outside the definition of and cannot legally support a claim for unfair claim
processing.

¶24 We defer to the ALJ's factual findings when reviewing ICA
awards. Avila, 219 Ariz. at 57, ¶ 2. The ALJ has the primary responsibility
to resolve conflicts in the evidence. Kaibab Indus. v. Indus. Comm'n, 196 Ariz.
601, 609, ¶ 25 (App. 2000) (holding the reviewing court is bound by ALJ's
resolution of conflicting testimony when reasonable evidence supports the
ALJ's conclusion). We also presume the ICA, in making an award,
considered all relevant evidence. Carranza v. Indus. Comm'n, 22 Ariz. App.
547, 550 (1974). We defer to the ALJ's resolution of conflicting evidence and
affirm the ALJ's findings if any reasonable theory of the evidence supports
them. Perry v. Indus. Comm'n, 112 Ariz. 397, 398–99 (1975).

¶25 Here, ample evidence supports the ICA's conclusions that the
carrier was diligent in attempting to obtain a medical records release and
Halloum was not cooperative. The miscommunications between the
parties are unfortunate but not a matter of unresponsiveness or neglect by
the carrier. The evidence supports the ICA's conclusion that the carrier
acted reasonably under the circumstances. The carrier took responsibility
for the untimely denial by paying the penalty, and the evidence supports
the ICA's conclusion that the carrier did not need to do anything more.

CONCLUSION

¶26 We affirm.

MATTHEW J. MARTIN • Clerk of the Court
FILED: JR

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