Ridolfi v. State Farm Mut. Auto. Ins. Co.

146 F.Supp.3d 619

Tracey T. Ridolfi, Plaintiff

v.State Farm Mutual Automobile Insurance Company, Defendant

No. 1:15-cv-00859

United States District Court, M.D. Pennsylvania.

Filed November 19, 2015

Steven R. Snyder, Steven R. Snyder, Attorney at Law, Harrisburg, PA, for Plaintiff.

Eamon C. Merrigan, Lori C. Miller, Goldberg Miller & Rubin, PC, Philadelphia, PA, for Defendant.

MEMORANDUM

Judge Kane

Before the Court is Defendant State Farm Mutual Automobile Insurance Company (“State Farm”)'s motion to dismiss Plaintiff's claims for bad faith, breach of duty of good faith and fair dealing, violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), and violation of the Pennsylvania Motor Vehicle Financial Responsibility Law (“MVFRL”). (Doc. No. 8.)¹ Also before the Court is Plaintiff's motion to schedule oral argument on State Farm's 12(b)(6) motion to dismiss. (Doc. No. 13.) The Court has jurisdiction over Plaintiff's claims pursuant to 28 U.S.C. § 1332 and 28 U.S.C. § 1441, and therefore, Pennsylvania law applies. For the reasons that follow, the Court will grant State Farm's motion to dismiss and deny Plaintiff's motion to schedule oral argument.

I. BACKGROUND²

On or about October 26, 2008, Plaintiff was involved in an automobile accident with Nancy Koller, now deceased, who failed to stop at a red traffic light and crashed into Plaintiff's car, causing her serious injuries. (Doc. No. 5 ¶ 5.) At the time of the accident, Plaintiff and her husband owned two automobiles, including the one she was driving, which were insured under a policy of automobile insurance issued by Defendant. (Id. ¶ 6.) The insurance policy on both vehicles was a “full tort” policy and included “stacking coverage,” which provided for an increase in the amount of uninsured or underinsured coverage by the number of vehicles insured by Defendant. (Id. ¶ 8.)

Following the accident, Plaintiff filed claims with Nancy Koller's insurance company, Liberty Mutual, and her own insurer, Defendant, for the damage to her vehicle and for her medical coverage. (Id. ¶ 9.) On or about September 15, 2014, Plaintiff settled with Liberty Mutual for an undisclosed sum and continued to pursue a claim with Defendant for unpaid medical bills and ongoing treatment, pain and suffering. (Id. ¶ 11.)

Plaintiff alleges that on or about August 28, 2013, Plaintiff's attorney wrote to Defendant requesting the amount of her policy limits for both vehicles. (Id. ¶ 12.) Plaintiff alleges that on or about September 20, 2013, Defendant responded to Plaintiff's attorney in writing, stating that the policy limits for the automobile insurance policies in effect at the time of the accident for uninsured/underinsured motorist coverage were $50,000/$100,000. (Id. ¶ 13.) After receiving the letter from Defendant, Plaintiff alleges that Plaintiff's attorney obtained her legal file from her lawsuit against Liberty Mutual. (Id. ¶ 14.) Upon receiving Plaintiff's legal file, Plaintiff's attorney found a document contained therein indicating that her uninsured/underinsured motorist policy limits were not $50,000/$100,000, as Defendant had reported in its September 20, 2013 letter, but were in fact $100,000/$300,000, respectively. (Id. ¶ 17.)

Plaintiff further alleges that throughout her litigation with Liberty Mutual, beginning in 2010, she has tried unsuccessfully to settle her claim with Defendant; however, she alleges that Defendant has “continuously and systematically prolonged its investigation in such a manner designed to delay and evade the settlement of Plaintiff's claim, including making ongoing requests for information from physicians who Plaintiff was never treated by and other inquiries which are irrelevant and duplicative.” (Id. ¶ 18.)

On April 14, 2015, Plaintiff filed a civil action in the Court of Common Pleas of York County, Pennsylvania, arising out of Defendant's actions as described above. The complaint asserted claims of insurer bad faith, breach of the duty of good faith and fair dealing, breach of contract, violation of the UTPCPL, and violation of the MVFRL. On May 4, 2015, Defendant removed the action to this Court on the grounds that complete diversity existed between the parties. (Doc. No. 1.) On May 8, 2015, Defendant filed a motion to dismiss for failure to state a claim. (Doc. No. 4.) Rather than oppose Defendant's motion, Plaintiff instead filed an amended complaint on May 21, 2015, as permitted by Federal Rule of Civil Procedure 15. (Doc. No. 5.) On June 4, 2015, Defendant filed the instant motion to dismiss Plaintiff's claims of bad faith, violation of the UTPCPL, and violation of the MVFRL (Doc. No. 8), and a supporting memorandum of law. (Doc. No. 9.) As noted above, Plaintiff's contractual claim is not addressed in the present motion. The motion is now fully briefed and ripe for disposition.

II. LEGAL STANDARD

A motion filed under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of a complaint's factual allegations. Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief,” in order to “give the defendant fair notice of what the... claim is and the grounds upon which it rests.” Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotation marks omitted) (interpreting Fed. R. Civ. P. 8(a) ). Generally, a court considering a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) must determine whether the complaint contains sufficient factual matter, accepted as true, to “state a claim to relief that is plausible on its face.” Iqbal , 556 U.S. at 678, 129 S.Ct. 1937.

Consistent with the Supreme Court's rulings in Twombly and Iqbal , the Third Circuit requires district courts to engage in a two-part analysis when reviewing a Rule 12(b)(6) motion: (1) first, a court should separate the factual and legal conclusions of a claim, accepting well-pleaded factual matter and disregarding legal conclusions; (2) second, a court should determine whether the remaining well-pled facts sufficiently demonstrate that a plaintiff has a “plausible claim for relief.” Fowler v. UPMC Shadyside , 578 F.3d 203, 210–11 (3d Cir.2009) (quoting Iqbal , 556 U.S. at 679, 129 S.Ct. 1937 ). Facial plausibility exists when the plaintiff pleads factual content “that allows the court to draw a reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (internal citations omitted). “Where a complaint pleads facts that are ‘merely consistent with’ a defendant's liability, it ‘stops short of the line between possibility and plausibility of ‘entitlement to relief.’ ' ” Id. (quoting Twombly , 550 U.S. at 557, 127 S.Ct. 1955 ).

In conducting its analysis, a court must accept all well-pleaded factual allegations in the complaint as true for purposes of determining whether the complaint states a plausible claim for relief, and must view the factual allegations in the light most favorable to the plaintiff. Phillips v. Cnty. of Allegheny , 515 F.3d 224, 231 (3d Cir.2008). In this regard, a court may “consider only the allegations in the complaint, exhibits attached to the complaint, matters of public record, and documents that form the basis of a claim.” Lum v. Bank of America , 361 F.3d 217, 221 n. 3 (3d Cir.2004).

The court's determination on a Rule 12(b)(6) review is not whether the non-moving party “will ultimately prevail,” but whether that party is “entitled to offer evidence to support the claims.” United States ex rel. Wilkins v. United Health Grp., Inc. , 659 F.3d 295, 302 (3d Cir.2011) (internal citations omitted). The court's analysis is a context-specific task requiring the court “to draw on its judicial experience and common sense.” Iqbal , 556 U.S. at 663–64, 129 S.Ct. 1937.

III. DISCUSSION

As noted above, Defendant seeks dismissal of Plaintiff's claims of bad faith, violation of the UTPCPL, and violation of the MVFRL.

A. Bad Faith

Plaintiff alleges that Defendant's actions constituted bad faith in violation of Pennsylvania's bad faith statute, 42 Pa.C.S.A. § 8371 et seq. (Doc. No. 5 ¶¶ 21-33.) In its motion to dismiss, Defendant argues that Plaintiff's allegations of bad faith are conclusory and boilerplate assertions that fall short of the standard set by Twombly , and as such, should be dismissed for failure to state a claim for which relief can be granted.

Pennsylvania courts have defined bad faith as “any frivolous or unfounded refusal to pay proceeds of a policy; it is not necessary that such refusal be fraudulent. For purposes of an action against an insurer for failure to pay a claim, such conduct imports a dishonest purpose and means a breach of a known duty (i.e. good faith and fair dealing), through some motive of self-interest or ill will; mere negligence or bad judgment is not bad faith.” Morrison v. Mountain Laurel Assur. Co. , 748 A.2d 689, 691 (Pa.Super.Ct.2000) (citations omitted). Therefore, a plaintiff must “show [1] that the defendant did not have a reasonable basis for denying benefits under the policy and [2] that defendant knew or recklessly disregarded its lack of reasonable basis in denying the claim.” UPMC Health Sys. v. Metro. Life Ins. Co. , 391 F.3d 497, 505 (3d Cir.2004) (quoting Terletsky v. Prudential Prop. and Cas. Ins. Co. , 437 Pa.Super. 108, 649 A.2d 680, 688 (1994) ).

Courts have also recognized the potential existence of bad faith in situations where there has not been an outright refusal to pay benefits, such as a lack of investigation, failure to communicate with an insured, or delay. See Frog, Switch & Mfg. Co., Inc. v. Travelers Ins. Co. , 193 F.3d 742, 751 n. 9 (3d Cir.1999) ; Wiener v. Banner Life Ins. Co. , No. 2–1351, 2003 U.S. Dist. LEXIS 4957, at *19–20 (E.D.Pa. Feb. 28, 2003). In the case of an allegation of bad faith delay, a plaintiff must allege that...