Demente v. Geico Gen. Ins. Co.
| Decision Date | 15 February 2018 |
| Docket Number | No. CIV 17-0321 JB/JHR,CIV 17-0321 JB/JHR |
| Parties | JAMES O. DEMENTE, Plaintiff, v. GEICO GENERAL INSURANCE COMPANY; VICTORIA DILUCENTE; ANTHONY DILUCENTE; and- DERICA DUNN-GROSS, Defendants. |
| Court | U.S. District Court — District of New Mexico |
THIS MATTER comes before the Court on: (i) Defendant Derica Dunn-Gross' Second Motion to Dismiss for Insufficient Process, filed April 18, 2017 (Doc. 12) ("Service of Process MTD"); and (ii) Defendant GEICO General Insurance Company's Motion to Dismiss with Prejudice Under Rule 12(b) and Memorandum in Support Thereof, filed April 21, 2017 (Doc. 13)("MTD"). The Court held a hearing on July 27, 2017. The primary issues are: (i) whether the Court should dismiss Plaintiff James Demente's claims against Defendant Derica Dunn-Gross, because Demente's summons on Dunn-Gross lacked the United States District Court of New Mexico's name, the time within which Dunn-Gross must appear and defend, the Clerk of the Court's signature, and the District of New Mexico's seal; and (ii) whether Demente's settlement with Defendants Victoria Dilucente and Anthony Dilucente precludes Demente's claims under the Unfair Insurance Practice Act ("UIPA"), N.M. Stat. Ann. §§ 59a-16-1 to 30, against GEICO Insurance. The Court concludes that Demente's summons on Dunn-Gross was defective under rule 4(a) of the Federal Rules of Civil Procedure. Nevertheless, the Court, in its discretion, may grant a party additional time to effect proper service and the Court does so here. The Court also concludes that, under Hovet v. Allstate Ins. Co., 2004-NMSC-010, ¶ 26, 89 P.3d 69, 76-77, Demente's UIPA claim is precluded. The Court, therefore, grants the MTD.
The Court takes the facts from the Complaint for Damages Resulting from Personal Injury, Insurance Bad Faith, Violations of the New Mexico Unfair Trade Practices Act and Punitive Damages, filed May 13, 2016, in Demente v. Dilucente, D-1329-CV-2016-00743, (Thirteenth Judicial District Court, County of Sandoval, State of New Mexico), filed in federal court on March 8, 2017 (Doc. 1)("Complaint"). As the Court must, it accepts the Complaint's factual allegations as true for the purposes of a motion to dismiss. See Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). The Court may also consider facts judicially noticed on a motion to dismiss without converting the motion into one for summary judgment. See Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 322 (2007)("[C]ourts must consider the complaint in its entirety, as well as . . . matters of which a court may take judicial notice."); S.E.C. v. Goldstone, 952 F. Supp. 2d 1060, 1191 (D.N.M. 2013)(Browning, J.).
On August 7, 2014, Demente was driving his vehicle in Rio Rancho, New Mexico. See Complaint ¶ 6, at 2. As he approached NM 528 from Sara Road, the intersection's light changed from green to yellow. See Complaint ¶ 7, at 2. Demente attempted to clear the intersection before the light turned red, but, before he could, A. Dilucente turned his 1993 Ford vehicle in front of Demente. See Complaint ¶¶ 3, 8, at 1-2. The two cars collided. See Complaint ¶ 8, at 2. At the scene, A. Dilucente accepted responsibility for driver inattention and failure to yield the right of way. See Complaint ¶ 10, at 2.
Subsequently, Demente attempted several times to resolve an insurance claim against V. Dilucente -- the 1993 Ford vehicle's owner. See Complaint ¶¶ 2, 12, at 1-2. GEICO Insurance -- V. Dilucente's insurance provider -- covers $100,000.00 per occurrence in property damage and bodily injury for an accident involving V. Dilucente's vehicle. See Complaint ¶ 22, at 4. GEICO Insurance made several different requests for Demente's medical records and for other information to evaluate Demente's claim. See Complaint ¶ 13, 23 at 3-4. Demente promptly and accurately responded to each GEICO Insurance request. See Complaint ¶ 13, at 3.
Demente filed his complaint in the Thirteenth Judicial District Court, County of Sandoval, State of New Mexico. See Complaint ¶ 1, at 1. Demente sued the Dilucentes for negligence, and he sued GEICO Insurance and its agent, Dunn-Gross, under the UIPA. See Complaint ¶¶ 17-24, at 3-5.1 GEICO Insurance moved to bifurcate the action and stay the suit as to it pursuant to Martinez v. Reid, 2002-NMSC-015, ¶ 29, 46 P.3d 1237, 1244. See Defendant Geico General Insurance Company's Unopposed Motion to Bifurcate and Stay, filed August 24, 2016, in Demente v. Dilucente, D-1329-CV-2016-00743 (Thirteenth Judicial District Court, County of Sandoval, State of New Mexico), filed in federal court on April 5, 2017 (Doc. 11)("Stay and Bifurcation Motion"). The state court granted the Stay and Bifurcation Motion which would remain in effect until the underlying negligence cause of action against the Dilucentes was resolved. See Order Granting Defendant Geico General Insurance Company's Unopposed Motion to Bifurcate and Stay, filed September 7, 2016, in Demente v. Dilucente, D-1329-CV-2016-00743 (Thirteenth Judicial District Court, County of Sandoval, State of New Mexico), filed in federal court on April 5, 2017 (Doc. 11).
Dunn-Gross subsequently moved to dismiss Demente's claim for insufficiency of service of process. See Defendant Derica Dunn-Gross's Motion to Dismiss for Insufficiency of Service of Process, filed November 14, 2016, in Demente v. Dilucente, D-1329-CV-2016-00743 (Thirteenth Judicial District Court, County of Sandoval, State of New Mexico), filed in federal court on April 5, 2017 (Doc. 11)("Dunn-Gross MTD"). Dunn-Gross argues that, under the New Mexico Rules of Civil Procedure, Demente failed to properly serve her, because: (i) Demente did not serve her at a location where she was found after she had refused to accept service personally; (ii) Demente did not serve her at her home; (iii) Demente did not mail her a copy of the summons and complaint via first class mail to her home or to her workplace; and (iv) Demente's attempt to serve her through an executive secretary at GEICO Insurance was insufficient, because GEICO Insurance's executive secretary was not authorized to accept service on Dunn-Gross' behalf. See Dunn-Gross MTD at 3.
After Dunn-Gross filed the Dunn-Gross MTD, Demente settled his negligence claims against the Dilucentes. See MTD ¶ 6, at 2. The state court dismissed those claims with prejudice, but left unresolved those "claims filed against Geico General Insurance Company in relation to . . . insurance bad faith, unfair trade practices, unfair insurance practices, and punitive damages." Stipulated Order of Partial Dismissal With Prejudice at 1, filed February 24, 2017, in Demente v. Dilucente, D-1329-CV-2016-00743 (Thirteenth Judicial District Court, County of Sandoval, State of New Mexico), filed in federal court on April 5, 2017 (Doc. 11)("StateOrder"). GEICO Insurance subsequently removed the case to federal court. See Notice of Removal at 1, filed March 8, 2017 (Doc. 1)("Notice of Removal").2
Dunn-Gross argues that Demente's attempt to serve her after removal is defective, so the Court lacks personal jurisdiction over her. See Service of Process MTD at 3. She contends that the summons is defective in five ways. See Service of Process MTD at 3-4. First, the summons did not contain the federal court's name. See Service of Process MTD at 3-4 (citing Fed. R. Civ. P. 4(a)(1)(A); Fed. R. Civ. P. 12(b)(4)). Second, the summons does not refer to theFederal Rules of Civil Procedure. See Service of Process MTD at 4. Third, it does not contain the time that Dunn-Gross needs to appear to defend herself. See Service of Process MTD at 4. Fourth, the summons does not bear the District of New Mexico's seal. See Service of Process MTD at 4. Fifth, and finally, the Clerk of the Court did not sign the summons. See Service of Process MTD at 4.
Dunn-Gross also argues that the Court should dismiss the Complaint, because Dunn-Gross was not served within ninety days of the Complaint's filing. See Service of Process MTD at 4 (citing Fed. R. Civ. P. 4(m)). According to Dunn-Gross, Demente first attempted to serve Dunn-Gross five months after he filed the Complaint -- albeit, while the Complaint was pending in state court -- and then attempted to serve Dunn-Gross once the case was removed to federal court -- eleven months after he filed his Complaint. See Service of Process MTD at 4. Dunn-Gross concludes that Demente has not shown good cause for his delay in serving Dunn-Gross, so the Court should dismiss the Complaint. See Service of Process MTD at 4-5.
GEICO Insurance argues that the Court should dismiss the UIPA claims, because, under Hovet v. Allstate, 2004-NMSC-010, ¶ 26, 89 P.3d 69, 76-77, a third party claimant does not have a cause of action under N.M. Stat. Ann. 59A-16-20 "unless and until there has been a judicial determination of the insured's fault." MTD at 4. According to GEICO Insurance, Hovet v. Allstate precludes Demente's claim, because "the parties settled." MTD at 4 (citing Hovet v. Allstate, 2004-NMSC-010, ¶ 26, 89 P.3d at 76-77). Moreover, according to GEICO Insurance, the claim is precluded, because Demente stipulated to dismissal of those claims before a judicial determination of A. Dilucente's fault. See MTD at 5.
Demente responds to the MTD. See Plaintiff's Response to Defendant's Geico's Motion to Dismiss with Prejudice Under Rule 12(b) and Request that Defendant be Compelled to Comply with the Terms of the Order it Submitted on September 7, 2016 for Bifurcation and Stay in the Thirteenth Judicial District Court (Document No. 13) at 1, filed May 12, 2017 (Doc. 15)("MTD Response"). Demente argues that GEICO Insurance is liable under N.M. Stat. Ann. § 59A-16-20, which requires insurers to "attempt in good faith to effectuate prompt, fair and equitable settlements of an insured's claims in which liability has become...
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