Leavitt v. United Servs. Auto. Ass'n

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ALLAN M. LEAVITT,^[1] Plaintiff, v. UNITED SERVICES AUTOMOBILE ASSOCIATION, GEICO INDEMNITY COMPANY, and THE COMMERCE INSURANCE COMPANY, INC., Defendants.

Civil Action No. 4:23-cv-11341-IT

United States District Court, D. Massachusetts

January 19, 2024

MEMORANDUM & ORDER

Indira Talwani, United States District Judge

Pending before the court in this putative class action are Motions to Dismiss [Doc. Nos. 31, 53, 56] Plaintiff Allan Leavitt's Complaint [Doc. No. 1] brought by the United Services Automobile Association (“USAA”), GEICO Indemnity Company (“GEICO”), and The Commerce Insurance Company (“Commerce,” and collectively “Defendants”). Also pending are GEICO's and USAA's Motions for Sanctions [Doc. Nos. 58, 89] and Plaintiff's Motions for Sanctions [Doc. Nos 72, 87, 118, 123]. For the following reasons, Defendants' Motions to Dismiss are GRANTED for lack of subject matter jurisdiction and for failure to state a claim, GEICO's and USAA's Motions for Sanctions are GRANTED, and Plaintiff's Motions for Sanctions are DENIED.

I. BACKGROUND

This action follows litigation commenced in 2013 in state court and in 2020 in this court.^[2]

A. The 2013 State Court Action

This court has previously set forth the factual background and the procedural history of the state court proceedings (the “2013 State Court Action”) and incorporates that discussion by reference here. See Leavitt v. United Servs. Auto. Ass'n, No. 1:20-cv-12130-IT, 2021 WL 3025863, at *1-5 (D. Mass. July 16, 2021), aff'd, No. 21-1561, 2022 WL 2355473 (1st Cir. Apr. 7, 2022), cert. denied, 143 S.Ct. 201, 214 L.Ed.2d 76 (2022). The state court action concluded with the United States Supreme Court denying Leavitt's petition for writ of certiorari. Leavitt v. Phillips, et al., 140 S.Ct. 1216 (2020).

B. The 2020 Federal Court Action

On November 30, 2020, Leavitt filed a federal action (“2020 Federal Court Action”) in the District of Massachusetts. On February 11, 2021, Leavitt filed an Amended Complaint against the same Defendants named here (USAA, GEICO, and Commerce) and others. Am. Compl. (“2021 Complaint”), No. 20-cv-12130, Doc. No. 17.

Leavitt's 2021 Complaint demanded in Count I that the court issue a declaratory judgment that: (i) Mass. Gen. Laws ch. 90, §§ 3 and 34A “require[] non-resident motor vehicle owners to ‘maintain' Massachusetts PIP ‘provisions' as part of their ‘policy of liability insurance,'” and that (ii) “policies of liability insurance issued by ‘GEICO' and USAA provide Massachusetts PIP ‘protection.'” Id. ¶ 32 (emphasis in original). The 2021 Complaint also asserted claims for breach of contract against GEICO and USAA (counts II-III); fraud, conspiracy, and misrepresentation against GEICO, USAA, Commerce, and others (Count VIII); negligent, willful, wanton, and intentional interference with contractual relations against GEICO, USAA, Commerce, and others (Count IX); aiding and abetting suppression of his rights against GEICO, USAA, Commerce, and others (Count X); breach of fiduciary duty against GEICO and USAA (Count XI); breach of fiduciary duty and aiding and abetting against unnamed J. Does, GEICO, and USAA (Count XIII); and RICO violations against all defendants (Count XIV). Id. ¶¶ 38-102. The 2021 Complaint also sought specific performance against GEICO and USAA (Count XV). Id. ¶¶ 103-11.

GEICO, USAA, Commerce, and the other defendants filed motions to dismiss the 2021 Complaint. This court granted the motions, finding that the 2021 Complaint was based upon the same underlying events at issue in the 2013 State Court Action, Leavitt, 2021 WL 3025863, at *5, and that “[u]nder the Rooker-Feldman doctrine, this court does not have jurisdiction to revisit substantially the same issues already decided by the Superior Court and the Appeals Court,” id. at *8. This court reasoned that it made no difference that Plaintiff added claims about “a vast conspiracy with the state courts to deny him access to justice” because the Rooker-Feldman doctrine was “not contingent upon an identity between the issues actually litigated in the prior state-court proceedings and the issues proffered in the subsequent federal suit.” Id. Instead, “the critical datum is whether the plaintiff's federal suit is, in effect, an end-run around a final statecourt judgment.” Id. (quoting Klimowicz v. Deutsche Bank, 907 F.3d 61, 66-67 (1st Cir. 2018)). This court further noted that “Leavitt has had his day in court and has exhausted all the review to which he is entitled.” Id.

Leavitt appealed and, after a “careful review of the record,” the First Circuit affirmed “for substantially the reasons set forth in the district court's July 16, 2021 decision.” Leavitt v. United Servs. Auto. Ass'n, No. 21-1561, 2022 WL 2355473, at *1 (1st Cir. Apr. 7, 2022). The First Circuit concluded that Plaintiff's “contentions on appeal, including his contention that the Rooker-Feldman doctrine does not bar his federal court suit due to the inclusion of non-identical claims and/or additional parties, are unconvincing.” Id. The Supreme Court denied certiorari. Leavitt v. United Servs. Auto. Ass'n, 143 S.Ct. 201 (2022).

C. The Present Action

On June 15, 2023, Leavitt initiated the action now before the court. See generally Compl. (“2023 Complaint”) [Doc. No. 1]. The 2023 Complaint is fashioned as a class action with one putative class representative, Leavitt. It asserts the following claims: Declaratory Judgment (Count I), id. ¶¶ 19-25; Breach of Contract (Count II), id. ¶¶ 27-28; Fraud and Civil Conspiracy (Count III), id. ¶¶ 32-33; Interference with Contractual Relations (Count IV), id. ¶¶ 36-40; Aiding and Abetting (Count V), id. ¶¶ 41-45; Breach of Fiduciary Duty (Count VI), id. ¶ 48; RICO violations (Count VII), id. ¶¶ 50-58; and Specific Performance (Count VIII), id. ¶ 60.

All Defendants moved to dismiss the complaint. USAA moved to dismiss the complaint for lack of subject matter jurisdiction due to res judicata, the Rooker-Feldman doctrine, and lack of Article III standing, and for failure to state a claim. Mot. to Dismiss [Doc. No. 31], Mem. in Support [Doc. No. 32]; see also Fed.R.Civ.P. 12(b)(1), (6). Commerce moved to dismiss for similar reasons and the additional reason that Leavitt's Complaint did not contain a short and plain statement of the claim, warranting dismissal under Rule 8(a)(2) of the Federal Rules of Civil Procedure. Am. Mot. To Dismiss [Doc. No. 53], Mem. in Support [Doc. No. 52]; see also Fed. R. Civ. P. 8(a)(2). GEICO also moved to dismiss for similar reasons. Mot. to Dismiss [Doc. No. 56], Mem. in Support [Doc. No. 57]. Leavitt has opposed all three motions. Opps. [Doc. Nos. 40, 68, 70].

Parties on both sides have filed motions for sanctions. GEICO moved for sanctions based on Leavitt's filing of the complaint. Mot. for Sanctions [Doc. No. 58]; Mem. in Support [Doc. No. 59]. Leavitt has opposed this motion, Opp. [Doc. No. 71], and has filed three motions for sanctions against GEICO: [First] Motion for Sanctions against GEICO (“Leavitt's First Sanctions Motion against GEICO”) [Doc. No. 72]; Second Motion for Sanctions against GEICO (“Leavitt's Second Sanctions Motion against GEICO”) [Doc. No. 87]; Third Motion for Sanctions against GEICO (“Leavitt's Third Sanctions Motion against GEICO”) [Doc. No. 123]. In support of these motions, Leavitt argues that GEICO's Motion to Dismiss and Motion for Sanctions are “clearly frivolous” and were filed “with no good-faith basis.” See generally Memo. ISO Mot. for Sanctions Against GEICO 14-15 [Doc. No. 73]; Memo. ISO Mot. for Sanctions Against GEICO 14-15 [Doc. No. 88]; Memo. ISO Mot. for Sanctions Against GEICO 14-15 [Doc. No. 124]. GEICO has opposed each motion. Opps. [Doc. Nos. 79, 94, 131].

Meanwhile, USAA also moved for sanctions based on Leavitt's complaint. Mot. for Sanctions [Doc. No. 89]; Mem. in Support [Doc. No. 90]. Leavitt has opposed this motion, Opp. [Doc. No. 91], and has filed a Motion for Sanctions against Defendant USAA (“Leavitt's Sanctions Motion against USAA”) [Doc. No. 118]. Leavitt's motion does not seem to be targeted at a particular pleading, although Leavitt argues that USAA's Motion for Sanctions should be denied. Memo. ISO Motion for Sanctions Against USAA 1, 20 [Doc. No. 119]. USAA has opposed this motion. Response [Doc. No. 125].

II. STANDARD OF REVIEW

A. Lack of Subject Matter Jurisdiction

“Rule 12(b)(1) is the proper vehicle for challenging a court's subject matter jurisdiction.” Valentin v. Hospital Bella Vista, 254 F.3d 358, 362-63 (1st Cir. 2001). A motion to dismiss for lack of constitutional standing is properly brought as a challenge to the court's subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1). See Katz v. Pershing, LLC, 672 F.3d 64, 70 (1st Cir. 2012). Federal courts are courts of limited jurisdiction, so federal jurisdiction is never presumed. Viqueira v. First Bank, 140 F.3d 12, 16 (1st Cir. 1998). The party asserting jurisdiction has the burden of demonstrating the existence of federal jurisdiction. Id. On a motion to dismiss, the court should treat all well-pleaded facts as true and provide the plaintiff the benefit of all reasonable inferences. Fothergill v. United States, 566 F.3d 248, 251 (1st Cir. 2009). Dismissal is appropriate only when the facts alleged in the complaint, taken as true, do not support a finding of federal subject matter jurisdiction. Id. A challenge to the court's subject matter jurisdiction must be addressed before addressing the merits of a case. See Acosta-Ramirez v. Banco Popular de Puerto Rico, 712 F.3d 14, 18 (1st Cir. 2013).

B. Failure to State a Claim

In evaluating a motion to dismiss for failure to state a claim the court assumes “the truth of all well-pleaded facts” and draws “all reasonable...