522 F.3d 1127 (10th Cir. 2008), 07-1219, Van Zanen v. Qwest Wireless, L.L.C.

Docket Nº:07-1219.
Citation:522 F.3d 1127
Party Name:Patrick VAN ZANEN; Vicki Van Zanen, Plaintiffs-Appellants, v. QWEST WIRELESS, L.L.C., a Delaware corporation; Qwest Services Corporation, a Colorado corporation; Qwest Communications International, Inc., a Delaware corporation, Defendants-Appellees.
Case Date:April 18, 2008
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit
 
FREE EXCERPT

Page 1127

522 F.3d 1127 (10th Cir. 2008)

Patrick VAN ZANEN; Vicki Van Zanen, Plaintiffs-Appellants,

v.

QWEST WIRELESS, L.L.C., a Delaware corporation; Qwest Services Corporation, a Colorado corporation; Qwest Communications International, Inc., a Delaware corporation, Defendants-Appellees.

No. 07-1219.

United States Court of Appeals, Tenth Circuit.

April 18, 2008

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO, D.C. NO. 06-cv-2546-LTB.

Page 1128

Jerry C. Bonnett (Francis J. Balint, Jr. and Kathryn A. Jann with him on the briefs), of Bonnett, Fairbourn, Friedman & Balint, P.C., Phoenix, AZ, for Plaintiffs - Appellants.

Christopher J. Koenigs (Michael B. Carroll with him on the brief), of Sherman & Howard, L.L.C., Denver, Colorado, for Defendants-Appellees.

Before HARTZ, McKAY and KELLY, Circuit Judges.

HARTZ, Circuit Judge.

Plaintiffs Patrick and Vicki Van Zanen appeal the dismissal of their claim for unjust enrichment against Qwest Wireless, LLC; Qwest Services Corporation; and Qwest Communications International, Inc. (collectively, Qwest). The Van Zanens, who are Arizona residents, allege that Qwest has acted as an unlicensed seller of insurance in violation of the laws of Arizona and 13 other states where it markets and sells handset insurance to its wireless customers. They assert that Qwest has been unjustly enriched by its receipt of sales commissions in violation of the licensing statutes and seek to recover the portion of the handset-insurance premium

Page 1129

that compensates Qwest for its sales efforts. The district court, after determining that the Arizona licensing statute provides no private right of action, ruled that the Van Zanens had not stated a claim for unjust enrichment on their own behalf. Because violation of a licensing statute, without more, is generally insufficient to support an unjust-enrichment claim against one who has performed as promised, we affirm the dismissal.

I. BACKGROUND

On review of a dismissal for failure to state a claim, we accept the allegations of the complaint as true. Sutton v. Utah State Sch. for Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir. 1999). According to the complaint, the Van Zanens purchased handset insurance from Qwest in May 2005 and had continued to subscribe to it until the complaint was filed. Qwest, which is not licensed to sell or solicit insurance in any of the 14 states in which it operates, markets and sells the handset insurance to its customers. The insurance policy itself is administered and underwritten by a third party, lock/line, LLC. Customers are billed for the insurance through Qwest, and Qwest retains a portion of the monthly payments as compensation for its sales efforts.

In December 2006 the Van Zanens filed suit in the United States District Court for the District of Colorado, alleging that Qwest's sales of the handset insurance violate the licensing laws of Arizona and 13 other states. They sought certification of the suit as a class action. Pleading implied statutory causes of action and common-law unjust enrichment, they prayed for an injunction against Qwest, a declaration that Qwest's conduct is unlawful, the imposition of a constructive trust on Qwest's share of the insurance payments, and disgorgement of that share.

The parties agreed that Arizona law governed the Van Zanens' statutory claim on their own behalf. Section 282 of the Arizona insurance code prohibits selling, soliciting, or negotiating insurance without a license. Ariz. Rev. Stat. Ann. § 20-282 (2001). Section 298 of that code prohibits receiving commissions without a license. Id. § 20-298(B). The only remedy explicitly provided by the statute is administrative recourse: if the director of insurance believes that a violation is occurring or is about to occur, the director may order the violator to cease and desist or may file a complaint to enjoin the violation. See id. § 20-292.

The district court first examined the Arizona licensing statute and decided that it implies no private right of action. Van Zanen v. Qwest Wireless, L.L.C., No. 06-cr-02546-LTB-PAC, 2007 WL 1160010, at *2-5 (D. Colo. April 19, 2007). Turning to the unjust-enrichment claim, the court held that the Van Zanens had not stated a claim for unjust enrichment because they had suffered "no detriment, expense, or impoverishment." Id. at *6. Rather, the court said, the Van Zanens "obtained a valuable product for which they bargained and which they intend to keep." Id. Because the Van Zanens had failed to state any proper claims on their own behalf, the court dismissed the class-action claims as well. Id. The Van Zanens appeal only the ruling on unjust enrichment.

II. DISCUSSION

We review de novo the dismissal of a complaint on a Rule 12(b)(6) motion for failure to state a claim. Sutton, 173 F.3d at 1236. We will affirm...

To continue reading

FREE SIGN UP