Hogan v. Provident Life and Acc. Ins. Co.
| Decision Date | 15 October 2009 |
| Docket Number | Case No. 6:08-cv-1897-Orl-19KRS. |
| Citation | 665 F.Supp.2d 1273 |
| Parties | Ronnie HOGAN, Plaintiff, v. PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, and Unum Group Corporation, Defendants. |
| Court | U.S. District Court — Middle District of Florida |
Mark A. Nation, The Nation Law Firm, Longwood, FL, for Plaintiff.
Timon V. Sullivan, Wm. Jere Tolton, III, Ogden & Sullivan, PA, Tampa, FL, for Defendants.
This case comes before the Court on the following:
1. Consolidated Motion to Dismiss First Amended Complaint for Failure to State a Claim or, in the Alternative, Motion for Judgment on the Pleadings by Defendants Provident Life and Accident Insurance Company and Unum Group Corporation (Doc. No. 46, filed Aug. 17, 2009); and
2. Response to Motion to Dismiss by Plaintiff Ronnie Hogan (Doc. No. 49, filed Sept. 10, 2009).
This action, brought in federal court pursuant to its diversity jurisdiction, concerns the Long Term Disability Insurance Policy which covered the Plaintiff and was provided by Defendant Provident Life and Accident Insurance Company ("Provident"). (Doc. No. 42, filed Nov. 10, 2008, ¶ 4.) In October of 2001, Defendant Provident began paying Plaintiff Hogan long term disability benefits. (Id. ¶ 6.) Provident discontinued payments to Hogan on or about February 29, 2004. (Id. ¶ 9.) On August 27, 2006, Hogan sued Provident for reimbursement of past due disability payments. (Id. ¶ 10.) Provident answered Hogan's complaint, claiming that he was no longer disabled and therefore no longer entitled to disability benefits under the policy. (Id. ¶ 11.) On June 27, 2007, Hogan submitted a Civil Remedy Notice of Insurer Violation to the Florida Department of Financial Services as required by statute. (Id. ¶ 12.) In response, Provident again stated that Hogan was no longer disabled and thus not entitled to benefits under the policy. (Id. ¶ 13.) Nevertheless, on January 30, 2008, Provident confessed judgment and paid the benefits demanded by Hogan. (Id. ¶ 15.)
Defendant Unum Group Corporation (f.k.a. Unumprovident) ("Unum") has been the holding company of Provident since 1999. (Id. ¶ 5.) Plaintiff Hogan alleges that Provident utilized not only its own employees, but also Unum's employees, to adjust, review, evaluate, handle, approve, and deny his disability insurance benefits. (Id. ¶ 6.) Additionally, Hogan alleges that Unum was the actual or apparent agent of Provident. (Id. ¶ 7.)
Plaintiff initially filed a Complaint against Defendant Provident asserting five counts: (1) violation of § 624.155(1)(b)(1), Florida Statutes, (2008), due to Provident's failure to attempt in good faith to settle claims; (2) violation of § 626.9541(1)(e)(1), Florida Statutes, for the knowing making, dissemination, and delivery of false statements; (3) violation of § 626.9541(1)(i)(2), Florida Statutes, for making material misrepresentations to Plaintiff to effect settlement on less favorable terms than those provided in the policy; (4) violation of § 626.9541(1)(i)(3), Florida Statutes, due to Provident's general business practice of mishandling claims; and (5) breach of fiduciary duty. (Doc. No. 1 at 3-10.)
Provident moved to dismiss the Complaint for failure to state a claim and to strike the prayer for punitive damages. (Doc. No. 25.) Hogan opposed this Motion except with regard to Count II which he voluntarily dismissed with prejudice. (Doc. Nos. 31, 33.) Hogan also moved for leave to amend the Complaint to add another defendant. (Doc. No. 37.) Provident opposed this Motion, claiming that leave to amend should be denied as futile. (Doc. No. 40.) The Court dismissed Counts I, III, IV, and V without prejudice, dismissed Count II with prejudice, and granted Plaintiff's Motion to Amend Complaint. (Doc. No. 41, filed July 20, 2009, at 13-14, 2009 WL 2169850.)
Plaintiff Hogan then filed an Amended Complaint against both Defendants Provident and Unum asserting eight counts: (1) violation of § 624.155(1)(b)(1), Florida Statutes, by Provident for failing to attempt in good faith to settle Plaintiff's claims; (2) violation of § 626.9541(1)(i)(2), Florida Statutes, by Provident for making material misrepresentations to Plaintiff to effect a settlement on less favorable terms than those provided in the policy; (3) violation of § 626.9541(1)(i)(3), Florida Statutes, by Provident for its general business practice of mishandling claims; (4) breach of fiduciary duty by Unum; (5) aiding and abetting Unum's breach of fiduciary duty by Provident; (6) common law fraud by Unum with Provident vicariously liable for such fraud; (7) negligence by Unum with Provident vicariously liable for such negligence; and (8) conspiracy to commit the statutory violations in Counts I—III by Unum. Plaintiff also claimed punitive damages in each count. (Doc. No. 42.) Defendants now move to dismiss the Amended Complaint for failure to state a claim upon which relief can be granted or, alternatively, for a judgment on the pleadings. (Doc. No. 46.) Plaintiff opposes dismissal. (Doc. No. 49.)
When ruling on a motion to dismiss for failure to state a claim upon which relief may be granted under Federal Rule of Civil Procedure 12(b)(6), a court must limit its consideration to the complaint, the written instruments attached to it as exhibits, "documents incorporated into the complaint by reference, and matters of which a court may take judicial notice." Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 323, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007); GSW, Inc. v. Long County, Ga., 999 F.2d 1508, 1510 (11th Cir.1993). In determining the merits of the motion, a court must "accept all factual allegations in the complaint as true." Tellabs, Inc., 551 U.S. at 323, 127 S.Ct. 2499. However, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions." Ashcroft v. Iqbal, ___ U.S. ___, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009). Thus, "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)).
Once a court "identif[ies] pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth," the court must next determine whether the well-pled facts "`state a claim to relief that is plausible on its face.'" Id. at 1949-50 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. at 1949 (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). "Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 1950 (citation omitted). As the United States Supreme Court explained:
The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully. 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. at 1949 (quotation marks and internal citations omitted) (quoting Twombly, 550 U.S. at 557, 127 S.Ct. 1955). On a Rule 12(b)(6) motion to dismiss, when a court considers the range of possible interpretations of the defendant's alleged conduct, if the "more likely explanations" involve lawful, non-actionable behavior, the court should find that the plaintiff's claim is not plausible. Id. at 1950-51.
When there are no material facts in dispute, judgment may be rendered by considering the substance of the pleadings and any judicially noticed facts. Horsley v. Rivera, 292 F.3d 695, 700 (11th Cir. 2002). Judgment on the pleadings is granted for the defendant only if "the plaintiff would not be entitled to relief under any set of facts that could be proved consistent with the allegations." Id.
Defendants move to dismiss the Amended Complaint for the following reasons: (1) Plaintiff fails to plead sufficient facts in Counts I, II, III, VII, and VIII and fails to plead Counts II, III, VI, and VIII with particularity pursuant to Rule 9(b) of the Federal Rules of Civil Procedure; (2) Plaintiff's common law causes of action in Counts IV and V are not recognized under Florida law; (3) Counts IV—VIII are duplicative of the statutory bad faith claims in Counts I—III; and (4) Plaintiff fails to plead sufficient facts in his claims for punitive damages.2
Hogan claims under Count I that Provident failed to attempt "in good faith to settle [Hogan's] claims when, under the circumstances, it could have and should have done so, had it acted fairly and honestly toward [Hogan], and with due regard for his interests," in violation of § 624.155(1)(b)(1), Florida Statutes. (Doc. No. 42 at 7-8.) Under Florida law, a first party's ability to bring a bad faith claim against an insurer is a right created by statute. Allstate Indem. Co. v. Ruiz, 899 So.2d 1121, 1125-26 (Fla.2005); State Farm Mut. v. Laforet, 658 So.2d 55, 63 (Fla.1995). The applicable statute, § 624.155, Florida Statutes, (2009), provides in pertinent part:
(1) Any person may bring a civil action against an insurer when such person is damaged: ...
(b) By the commission of any of the following acts by the insurer:
1. Not attempting in good faith to settle claims when, under all the...
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