Grimmer v. Costco Wholesale Corp.
| Decision Date | 27 September 2013 |
| Docket Number | Case No. 2:13-cv-00075-REB |
| Parties | NICOLE GRIMMER, Plaintiff, v. COSTCO WHOLESALE CORP., Defendant. |
| Court | U.S. District Court — District of Idaho |
Pending before the Court is Defendant's Motion to Dismiss (Dkt. 3) and Motion to Strike (Dkt. 14). Having considered the briefing and counsels' oral arguments, and otherwise being fully advised, this motion to dismiss is granted for the reasons explained below.
Plaintiff Nicole Grimmer ("Grimmer") believes that her brother Patrick Curtis should not have been fired by Defendant Costco on November 27, 2010, for allegedly being intoxicated at work. She contends that she was damaged as a result of that firing, allegedly because it led to Curtis discontinuing premium payments on a life insurance policy of which she was a beneficiary.1 Curtis stopped paying premiums about January 1,2012, approximately 13 months after his firing on November 27, 2010. Compl. ¶¶ 7-11, 16, 22, 28. Approximately eight months later, and almost two years after he lost his job at Costco, Curtis passed away. Id. at ¶ 2.
Grimmer argues that Costco did not follow its own policy for handling suspected workplace intoxication when firing Curtis and that, had Costco not fired Curtis, the life insurance policy would have remained in place at the time of his death. Grimmer alleges she was the named beneficiary on that policy. Compl. ¶ 27, 33. Her claim for relief alleges "wrongful interference with prospective economic advantage". Compl., p. 7. Costco has moved to dismiss, arguing that Grimmer's Complaint fails to state a claim for relief.
The Court is first faced with a preliminary issue - whether the Court must convert the motion into one for summary judgment because of the submission of evidence from outside the pleading record, or instead should strike Grimmer's affidavits in support of her opposition brief. Costco argues that the materials should be stricken because they were not referenced in the Complaint and because "basic fairness requires that the motion to dismiss not be converted to one for summary judgment." Mot. Strike, p. 2 (Dkt. 14-1).
When ruling on a motion to dismiss, the court must normally convert a Rule 12(b)(6) motion into one for summary judgment under Rule 56 if the court considers evidence outside of the pleadings. United States v. Ritchie, 342 F.3d 903, 907 (9th Cir. 2003). However, a court may consider certain materials, such as documents attached to the complaint, documents incorporated by reference in the complaint, or matters of judicial notice, without converting the motion to dismiss into a motion for summary judgment. Id. at 908.
"[D]ocuments whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading, may be considered in ruling on a Rule 12(b)(6) motion to dismiss." Branch v. Tunnell, 14 F.3d 449, 453 (9th Cir. 1994). Federal Rule of Evidence 201 also allows for the court to take judicial notice of a fact that is not subject to reasonable dispute where, as here, the fact "can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Fed. R. Evid. 201(b) (2). See also Reyn's Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n. 6 (9th Cir. 2006); Allen v. United Financial Mortg. Corp., 660 F.Supp.2d 1089, 1093 (N.D.Cal. 2009) ().
Grimmer's Affidavit attaches several documents, including an "Employee Agreement" pertaining to Curtis, through which (Grimmer argues) Costco provided Curtis various benefits of employment, including a life insurance policy paid for by Costco. Compl., ¶ 6 (Dkt. 1-1). She contends that the Employment Agreement required a "confirmation test" before an employee could be terminated for alcohol use on the job. Id. at p.2, ¶ 8. A second appended document - the Costco Drug and Alcohol Free Workplace Policy - is not specifically referred to in her Complaint, but Grimmer does discuss it in the context of her claim.
At the hearing on these motions, the Court said it likely would consider the Employee Agreement and the Workplace Policy document because, even though not attached to the Complaint, the two documents were an intrinsic part of the factual background related to Curtis's employment at Costco, and there was no genuine dispute as to their authenticity. The other documents appended to the Grimmer Affidavit, however, are not appropriate matters for the record of a Rule 12(b) motion. Accordingly, the motion to strike is granted as to those documents, and they will not be considered by the Court.
A motion to dismiss for failure to state a claim challenges the legal sufficiency of the claims stated in the complaint. Conservation Force v. Salazar, 646 F.3d 1240, 1242(9th Cir. 2011). To sufficiently state a claim to relief and survive a 12(b)(6) motion, the pleading "does not need detailed factual allegations," however, the "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Mere "labels and conclusions" or a "formulaic recitation of the elements of a cause of action will not do." Id. Rather, there must be "enough facts to state a claim to relief that is plausible on its face." Id. at 570. In other words, the complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
In light of Twombly and Iqbal, the Ninth Circuit summarized the governing standard as follows: "In sum, for a complaint to survive a motion to dismiss, the nonconclusory factual content, and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief." Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009). Apart from factual insufficiency, a complaint is also subject to dismissal under Rule 12(b)(6) where it lacks a cognizable legal theory, Balistreri v. Pacifica Police Dept., 901 F.2d 696, 699 (9th Cir. 1990), or where the allegations on their face "show that relief is barred for some legal reason." Jones v. Bock, 549 U.S. 199, 215 (2007).
In deciding whether to grant a motion to dismiss, the court must accept as true all well-pleaded factual allegations in the pleading under attack. Iqbal, 556 U.S. at 663. A court is not, however, "required to accept as true allegations that are merely conclusory,unwarranted deductions of fact, or unreasonable inferences." Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).
Although Idaho courts interpret interference with contract and interference with economic expectancy as "nearly identical" torts, Khurana v. North Cent. Dist. Health Dep't, 2012 WL 1288746, *10 (D.Idaho 2012) (quoting Highland Enterprises, Inc. v. Barker, 986 P.2d 996, 1004 (Idaho 1999)), the tort pled in this case does not require Grimmer to be a party to the Employee Agreement through which Curtis obtained his life insurance benefit.2 Grimmer's counsel confirmed at the hearing, and in his response brief, that Grimmer raises only a claim for wrongful interference with economic advantage. See Pl.'s Mem., p. 3 (Dkt. 10); compare Def.'s Mem., pp. 6-7 (Dkt. 3-1).
In order to proceed on that claim, Grimmer must sufficiently allege the following elements:
(1) the existence of a valid economic expectancy; (2) knowledge of the expectancy on the part of the interferer; (3) intentional interference inducing termination of the expectancy; (4) the interference was wrongful by some measure beyond the fact of the interference itself; and (5) resulting damage to the plaintiff whose expectancy has been disrupted.
Zoellner v. St. Luke's Reg'l Med. Ctr., No. 1:11-cv00382-EJL, 2013 WL 1314079 (D. Idaho Mar. 31, 2013) (citation and internal quotation marks omitted). The elements, andthe challenges raised to each, will be discussed below as needed in order to decide the motion.
(1) the existence of a valid economic expectancy
Grimmer argues that, as the sole beneficiary of Curtis's life insurance policy, she had a valid economic expectancy to the proceeds of such a policy upon Curtis's death. Pl.'s Mem., p. 4 (Dkt. 10). She contends that "but for the wrongful interference" of Costco (presumably in terminating Curtis's employment), she would have received the cash proceeds of that life insurance policy. Id. Costco argues that her status in that regard is too attenuated, and subject to change, to permit her to plausibly argue that such an expectancy exists. Nonetheless, in the template of a Rule 12(b) motion, the allegation that she has an economic expectancy in a life insurance policy of which she had been the sole beneficiary at the time the policy lapsed, is not beyond the realm of plausibility, and Costco's argument as directed to this element is not persuasive. The Court reaches that conclusion even recognizing that Curtis could have changed his beneficiary at any time.3 He did not do so before the policy lapsed for non-payment, and the prospect of a changed beneficiary is always a possibility, particularly in regard to a life insurance contract, because of its nature.4 But, such a change did not occur here, nor is there any evidencethat Curtis had ever named anyone other than his sister as the beneficiary of the insurance policy. Hence, the allegations upon this particular element of the claim rise above the level of speculation. See Bell, 550 U.S. at 555.
(2) knowledge of the expectancy on the part of the interferer
As to the second element, Grimmer argues that Costco had knowledge of her economic expectancy because it sent Curtis a letter notifying him that his life insurance policy was "po...
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