Ballesteros v. Garrison Prop. & Cas. Ins. Co.

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CHRISTOPHER BALLESTEROS, Plaintiff, v. GARRISON PROPERTY AND CASUALTY INSURANCE COMPANY, et al., Defendants.

No. 2:23-cv-00135-GMN-DJA

United States District Court, D. Nevada

April 27, 2023

ORDER

GLORIA M. NAVARRO, DISTRICT JUDGE UNITED STATES DISTRICT COURT

Pending before the Court is Defendant Garrison Property and Casualty Insurance Company's (“Defendant's”) Motion to Dismiss, (ECF No. 8). Plaintiff Christopher Ballesteros (“Plaintiff”) filed a Response, (ECF No. 10), to which Defendant filed a Reply, (ECF No. 16).

For the reasons discussed below, the Court GRANTS in part and DENIES in part Defendant's Motion to Dismiss.

I. BACKGROUND

This case arises from injuries Plaintiff sustained in an accident with a third-party driver in April 2021. As a result of the collision, Plaintiff suffered damage to his vehicle and physical injury, including “sprains/strains of the cervical, thoracic, and lumbar spine, right shoulder sprain headaches, and permanent whole person impairment to his cervical and thoracic spine and right shoulder.” (Am Compl. ¶ 14, Ex. B to Pet. Removal, ECF No. 1-2).

Following the collision, Plaintiff made a demand to the third-party driver's insurer for the policy limits to provide partial coverage for his injuries. (Id. ¶ 15, Ex. B to Pet. Removal). Because Plaintiff's medical expenses and future surgical recommendations exceeded the third-party driver's policy limits, Plaintiff also made a claim for benefits under his policy, Number 032284859R71019 (the “Policy”), to Defendant. (Id. ¶ 6, 16, Ex. B to Pet. Removal). On May 12, 2021, Defendant was contacted by Plaintiff's counsel, who requested a “claim evaluation as well as payments of any benefits owed under the Policy. (Id. ¶ 17, Ex. B to Pet. Removal). That same day, Defendant acknowledged receipt of the claim. (Id. ¶ 18, Ex. B to Pet. Removal).

On November 22, 2021, Plaintiff sent Defendant further documentation of his injuries and again requested payment of benefits owed under the Policy. (Id. ¶ 19, Ex. B to Pet. Removal). Plaintiff alleges that rather than investigate Plaintiff's claims, “as it is obligated to do under the Policy and Nevada law,” Defendant informed him that “it would not begin reviewing his claim until he provided written confirmation of the at-fault driver's policy limits and an affidavit of no additional insurance for the at-fault driver.” (Id. ¶ 20, Ex. B to Pet. Removal). Plaintiff contends that the Policy contains no condition which requires this information prior to Defendant instituting an investigation. (Id. ¶ 21, Ex. B to Pet. Removal). Instead, Plaintiff asserts that Defendant had an “independent obligation to investigate, evaluate, and resolve” Plaintiff's claims without regard to the conduct of the third-party driver's insurer. (Id. ¶ 22, Ex. B to Pet. Removal).

In January 2022, Defendant made an offer to settle Plaintiff's claim, which Plaintiff alleges was unreasonable because the offer “was based on an inadequate and incomplete investigation of his” claim” since Defendant solely relied on the opinion of its internal claim handlers rather than medical professionals. (Id. ¶¶ 23-25, Ex. B to Pet. Removal). In response to this purportedly unreasonable settlement offer, Plaintiff hired Kevin Nozawa (“Doctor Nozawa”), a Board Certified Independent Medical Examiner and Certified Life Care Planner, to perform an independent medical examination in March 2022. (Id. ¶ 26, Ex. B to Pet. Removal). Plaintiff provided Defendant with Doctor Nozawa's evaluation on April 7, 2022, and again requested that Defendant consider all the provided medical evidence and opinion in evaluating his claim. (Id. ¶ 29, Ex. B to Pet. Removal). According to Plaintiff, however, on April 18, 2022, Defendant wrote to Plaintiff's counsel reiterating its earlier settlement offer without addressing Doctor Nozawa's report. (Id. ¶ 30, Ex. B to Pet. Removal).

On June 15, 2022, Defendant wrote to Plaintiff's counsel stating it had received his “demand” and was “currently in the process of evaluating it.” (Id. ¶ 31, Ex. B to Pet. Removal). Two days later, Defendant sent another letter conveying its unchanged settlement offer. (Id. ¶ 32, Ex. B to Pet. Removal). Plaintiff alleges that to Dated: (1) Defendant has not provided any contractual or factual basis for its valuation of his claim; (2) not paid him any benefits under the Policy; (3) and not addressed, either to accept or refute Doctor Nozawa's findings. (Id. ¶¶ 33-35, Ex. B to Pet. Removal).

Plaintiff subsequently filed suit in the Eighth Judicial District Court of Nevada. (See generally Compl., Ex. A to Pet. Removal, ECF No. 1-1). Plaintiff then filed an Amended Complaint, alleging claims for: (1) declaratory relief; (2) breach of contract; (3) tortious breach of the implied covenant of good faith and fair dealing; and (4) breach of statutory duties under NRS § 686A.310. (Am. Compl. ¶¶ 38-60, Ex. B to Pet. Removal). Defendant then removed to this Court based on diversity jurisdiction, (see generally Pet. Removal, ECF No. 1), and filed the instant Motion to Dismiss, (ECF No. 8). The Court discusses Defendant's Motion to Dismiss below.

II. LEGAL STANDARD

Dismissal is appropriate under Rule 12(b)(6) where a pleader fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A pleading must give fair notice of a legally cognizable claim and the grounds on which it rests, and although a court must take all factual allegations as true, legal conclusions couched as factual allegations are insufficient. Twombly, 550 U.S. at 555. Accordingly, Rule 12(b)(6) requires “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Id. “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. This standard “asks for more than a sheer possibility that a defendant has acted unlawfully.” Id.

“Generally, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion.” Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555 n.19 (9th Cir. 1990). “However, material which is properly submitted as part of the complaint may be considered.” Id. Similarly, “documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading, may be considered in ruling on a Rule 12(b)(6) motion to dismiss.” Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994). On a motion to dismiss, a court may also take judicial notice of “matters of public record.” Mack v. S. Bay Beer Distrib., 798 F.2d 1279, 1282 (9th Cir. 1986). Otherwise, if a court considers materials outside of the pleadings, the motion to dismiss is converted into a motion for summary judgment. Fed.R.Civ.P. 12(d).

If the court grants a motion to dismiss for failure to state a claim, leave to amend should be granted unless it is clear that the deficiencies of the complaint cannot be cured by amendment. DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992). Pursuant to Rule 15(a), the court should “freely” give leave to amend “when justice so requires,” and in the absence of a reason such as “undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed undue prejudice to the opposing party by virtue of allowance of the amendment, futility of the amendment, etc.” Foman v. Davis, 371 U.S. 178, 182 (1962).

III. DISCUSSION

As stated, Plaintiff's Amended Complaint asserts the following claims: (1) declaratory relief; (2) breach of contract; (3) tortious breach of the implied covenant of good faith and fair dealing; and (4) breach of statutory duties under NRS § 686A.310. (Am. Compl. ¶¶ 38-60, Ex. B to Pet. Removal). By the instant Motion to Dismiss, however, Defendant only moves to dismiss Plaintiff's causes of action for declaratory relief, tortious breach of the implied covenant of good faith and fair dealing, and breach of statutory duties under NRS § 686A.310. (Mot. Dismiss (“MTD”) 1:24-2:5). The Court discusses these claims below, beginning with Plaintiff's declaratory relief claim.

A. Declaratory Relief

Plaintiff's declaratory relief claim seeks declarations that: “(1) [Defendant] failed to pay Plaintiff benefits in accordance with the terms of [the Policy] and within Nevada law; (2) [Defendant's] conduct violated Nevada law; and (3) [Defendant's] misrepresentations to Plaintiff constituted a deceptive trade practice within Nevada law.” (Resp. 12:3-6, ECF No. 10) (citing Am. Compl. ¶¶ 39-41, Ex. B to Pet. Removal). Defendant maintains that Plaintiff's claim for declaratory relief is redundant and unnecessary because it essentially asks the Court to determine the parties' rights under the Policy as it relates Plaintiff's remaining causes of action. (MTD 7:7-8:13). The Court agrees.

The “declaratory relief statute should not be used for the purpose of anticipating and determining an issue which can be determined in the main action, but is instead most appropriate when it would be beneficial to make any early determination of coverage under the policy.” Rosas v. GEICO Cas. Co., 365 F.Supp.3d 1123, 1127 (D. Nev. 2019) (quotation omitted). Declaratory relief claims that are duplicative of a plaintiff's other claims are subject to dismissal....