Toyota - Matrix :: 2009 - Engine Seized And Died

We purchased a certified pre-owned 2009 Toyota Matrix (S--AWD) in January 2012, with approx 17K miles (a lease turn in). We purchased a platinum vehicle service plan that covers the car through 2017 or 100K miles. We had the oil changed at 22K miles (May 2012) per the recommended 5K miles at a private garage, not a Toyota dealer. This place had done work on my previous vehicle, a 1994 Corolla, for 6 years and had proven to be reliable and trustworthy, in my opinion.

Last Friday, my husband was driving our daughter to daycare, and 5 miles from our home, the oil and engine lights came on in close succession, and the engine seized and died. We had roadside assistance through the warranty, and it was towed to the nearest Toyota dealer, which is not the one we purchased the vehicle at. They informed me that the car had no oil filter and that therefore nothing that happened to the car was covered under warranty, and said it was clearly the fault of whomever had changed the oil.

Problem: The oil had been changed 4 months, and 4K miles before this happened.Problem: There is no evidence of an oil leak in our garage, our driveway, the driveway at my workplace: There is no evidence of a catastrophic oil dump along the 5 mile route before the car died: We cannot find an oil filter along this path either, we have been along it on bicycle looking in the weeds

So the car was in our garage with no oil leaking at 6:45 am, and somehow ended up out of oil, with no filter, in 5 miles, by 7 am. The car had been driving fine--I am the one who usually drives it. I actually drove it 80 miles on Tuesday b.c I had forgotten my laptop at home and had to make the trip to and from work twice (22 miles one way). Then my husband had Weds-Fri off and it was driven 12 miles to and from daycare on Weds and Thurs, and the 5 miles on Friday before it died. No lights were on when I drove it Tuesday, and he says no lights were on before the point that it died.

The guy who changed the oil says the he cannot see how they are at fault, b.c there is no way the car could go so far and so long with an improperly installed filter (it is the screw in style filter, not a cartridge), and that if it were loose, as soon as the seal was broken, oil would spray everywhere. He went and looked at the car at the dealer, and looked at the spot where the car broke down and said there is not enough oil there. There is about enough in spots that would cover an area around a foot in diameter. Toyota says it could have been a slow leak if it was not screwed on right--but where is the evidence for an oil leak? Shouldn't the oil light have gone off previously if oil was low? The oil change guy says there's no way there would be a slow leak, the oil would have all dumped out and killed the engine long before the filter somehow fell off. He keeps asking me where is the oil, and where is the filter? Which I would love to have the answers to those questions, but I don't. He says unless I can produce the filter to show it is the one he put in, and that it is banged up to show it came off the car, he won't pursue an insurance claim. Toyota says it sounds weird but since he is the last one that touched the car, it's his fault. Right now we are in the middle and it is looking like we are going to be stuck with the bill for a new engine.