Siler v. CSAA Gen. Ins. Co.

SANDRA SILER, Plaintiff v. CSAA GENERAL INSURANCE COMPANY Defendant

CIVIL ACTION NO. 3:20-96

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF PENNSYLVANIA

February 11, 2021

(JUDGE MANNION)

MEMORANDUM

Presently before the court is the defendant CSAA General Insurance Company's motion to dismiss for failure to state a claim. (Doc. 7). Also before the court is a motion for leave to file an amended complaint filed by the plaintiff Sandra Siler. (Doc. 39). For the reasons set forth below, CSAA's motion to dismiss will be GRANTED and Siler's motion to amend will be DENIED.

I. BACKGROUND

On January 17, 2020, CSAA removed this action to this court. (Doc. 1). The action involved an accident that occurred on November 2, 2017, wherein Siler was driving her 2009 Suzuki SX4, which was insured under an automobile policy issued by CSAA.

Siler filed a claim with CSAA. The value of the vehicle was determined to be $5,654.57 and, after subtracting the $500.00 deductible, CSAA issued a final payment of $5,242.55 to Siler "based on the vehicle's market value just before the loss." (Doc. 1-1, at 81). CSAA's settlement letter indicated that the "[m]arket value represents the dollar amount you could expect to receive if you sold the vehicle in the marketplace prior to the incident." (Doc. 1-1, at 81). That amount did not include title fees, title lien fees, registration fees, county fees, or safety and emissions inspection fees, which are mandatory fees necessary to replace a vehicle in Pennsylvania. In the "Coverage for Damage to Your Auto" section of Siler's policy, it stated that CSAA would "pay for direct and accidental loss to 'your covered auto' . . . minus any applicable deductible shown in the Declarations." (Doc. 1-2, at 37). Under the "Limit of Liability" section, it stated that that CSAA's limit of liability is the lowest of: (1) "Actual cash value of the stolen or damaged property"; or (2) "Amount necessary to repair or replace the property with other property of like kind and quality." (Doc. 1-1, at 44). Actual Cash Value ("ACV") is not defined in the policy.

Siler brings this action on behalf of herself and other putative class members, alleging that CSAA systematically underpaid policyholders by refusing to pay for title, title lien, registration, county, and safety andemissions inspection fees on all total loss vehicles when calculating ACV. She alleges these fees are "mandatory, unavoidable fees" that are "incontrovertibly part of the costs to replace a total loss vehicle." (Doc. 1-1, at 5). CSAA's refusal to pay them, Siler alleges, is a breach of CSAA's insurance policies, which requires them to pay ACV on total loss claims. She seeks both repayment of the costs and fees that should have been calculated in the ACVs and injunctive relief.

On February 19, 2020, CSAA filed a motion to dismiss. (Doc. 7). Siler filed a brief in opposition on March 26, 2020. (Doc. 25). CSAA has filed a reply brief. (Doc. 26).

On July 15, 2020, Siler filed a notice of supplemental authority, alerting the court to a recent similar case in the Middle District of Florida.¹ (Doc. 28). On July 20, 2020, CSAA filed its own notice of supplemental authority, attaching two cases which, it contended, presented identical circumstances as the underlying case.² (Doc. 29).

On July 22, 2020, Siler filed a "response" to CSAA's supplemental authority, objecting to CSAA's representation that the two cases presented "identical circumstances." (Doc. 30). Siler argued that policy language in the two cases is materially different than the policy here since, unlike in those cases, her policy does not define ACV. Siler additionally attached yet another case.³

CSAA filed a letter the following day objecting to Siler's response arguing that there is no authority for such a filing in the Local Rules. (Doc. 31). Although Local Rule 7.36 permits a party to file a notice of supplemental authority, the rule expressly provides that it "must not include any argument," such as that included in Siler's response. M.D.Pa.L.R. 7.36.CSAA subsequently filed three more notices of supplemental authority. (Doc. 32; Doc. 33; Doc. 36).⁴

On September 24, 2020, Siler filed a motion for leave to file an amended complaint, (Doc. 39), and a brief in support, (Doc. 40). CSAA filed a brief in opposition. (Doc. 47).

CSAA also filed three more notices of supplemental authority, (Doc. 41; Doc. 45; Doc. 49).⁵ Siler filed two more "Responses" to the notices ofsupplemental authority, attempting to distinguish the cases. (Doc. 44; Doc. 50). CSAA responded with two letters reiterating that such filings were inappropriate under the Local Rules and this time requested that the responses be stricken. (Doc. 46; Doc. 51).

II. STANDARD

A. Motion to Dismiss

CSAA's motion to dismiss is brought pursuant to Federal Rule of Civil Procedure 12(b)(6), which provides for the dismissal of a complaint, in whole or in part, if the plaintiff fails to state a claim upon which relief can be granted. In deciding a defendant's motion, the court must read the complaint in the light most favorable to the plaintiff and all well-pleaded, material allegations in the complaint must be taken as true. Estelle v. Gamble, 429 U.S. 97 (1976). However, the court need not accept inferences drawn by the plaintiff if they are unsupported by the facts as set forth in the complaint. See California Pub. Employee Ret. Sys. v. The Chubb Corp., 394 F.3d 126, 143 (3d Cir. 2004). The court also need not accept legal conclusions set forth as factual allegations. Bell Atlantic Corp. v. Twombly, 550 U.S. 554, 555 (2007).

In deciding a motion to dismiss, the court should generally consider only the allegations contained in the complaint, the exhibits attached to the complaint, matters of public record, and "undisputably authentic" documents which the plaintiff has identified as the basis of his claim. See Pension Benefit Guarantee Corp. v. White Consolidated Industries, Inc., 998 F.2d 1192, 1196 (3d Cir. 1993).

Additionally, the court should generally grant leave to amend a complaint before dismissing it as merely deficient. See, e.g., Fletcher-Harlee Corp. v. Pote Concrete Contractors, Inc., 482 F.3d 247, 252 (3d Cir. 2007); Grayson v. Mayview State Hosp., 293 F.3d 103, 108 (3d Cir. 2002); Shane v. Fauver, 213 F.3d 113, 116-17 (3d Cir.2000). "Dismissal without leave to amend is justified only on the grounds of bad faith, undue delay, prejudice, or futility." Alston v. Parker, 363 F.3d 229, 236 (3d Cir. 2004).

B. Motion for Leave to Amend

Pursuant to Federal Rule of Civil Procedure 15, a party must seek to amend where, as here, 21 days have passed since the service of the opposing party's responsive pleading. Fed.R.Civ.P.15(a)(2). Although the court "should freely give leave when justice so requires," id., amendment is not automatic. See Dover Steel Co., Inc. v. Hartford Accident and Indent.,151 F.R.D. 570, 574 (E.D.Pa. 1993). Leave to amend should be granted absent a showing of "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 the allowance of the amendment, futility of amendment, etc." Forman v. Davis, 371 U.S. 178, 182 (1962).

"Amendment of the complaint is futile if the amendment will not cure the deficiency in the original [pleading] or if the amended [pleading] cannot withstand a renewed motion to dismiss." Jablonski v. Pan Am. World Airways, Inc., 863 F.2d 289, 292 (3d Cir. 1988). Additionally, if the proposed amendment "is frivolous or advances a claim or defense that is legally insufficient on its face, the court may deny leave to amend." Harrison Beverage Co. v. Dribeck Importers, Inc., 133 F.R.D. 463, 468 (D.N.J. 1990).

Where a plaintiff's amended complaint seeks merely to "bring mostly the same claims" as asserted previously, particularly if they were previously dismissed, leave to amend may be denied. Juan v. Sanchez, 339 Fed.App'x 182, 187 (3d Cir. 2009).

III. DISCUSSION

A. Motion to Dismiss

In its motion to dismiss, CSAA argues that Siler fails to state a breach of contract claim for at least two reasons. First, CSAA argues that based upon the express language of the policy, ACV does not mean replacement value of the vehicle. CSAA emphasizes that the policy states its liability is limited to the lower of either ACV of the damaged property or the amount necessary to repair or replace the damaged property. If ACV had the same meaning as "replacement costs," then, CSAA argues, the language limiting liability to the lower of one or the either would make no sense.

CSAA argues that Pennsylvania courts have confirmed this fact. Although Siler contends that Pennsylvania law has consistently been interpreted to mean "repair or replacement costs less depreciation," (Doc. 1-1, at 7), CSAA argues that this point ignores the "intent of the parties as manifested by the language of the written instrument." (Doc. 8, at 12) (quoting Madison Const. Co. v. Harleysville Mut. Ins. Co., 557 Pa. 595 (Pa. 1999)). CSAA cites Kane v. State Farm Fire & Cas. Co, 841 A.2d 1038, 1045 (Pa.Super. 2003), wherein Pennsylvania's Superior Court noted that, under Pennsylvania law, "actual cash value [is] not the same as market value, which would incorporate depreciation, but rather was akin toreplacement cost." Kane also noted, however, that "explicit policy language may avoid" that definition. Id. at 1047. That, CSAA maintains, was the scenario in Kane where insurance policies at issue contained "qualifying language indicating that 'actual cash value' will be the proffered compensation where the insured does not repair or replace the damage." Id. at 1049. As a result of that policy language, Kane held that ACV could not mean replacement value because "such interpretation would make the remaining policy language nonsensical." Id. Thus, under those polices, "actual cash value [could] not also mean replacement value." Id....