Meighan v. Transguard Ins. Co. of Am., Inc., No. C 13–3024–MWB.

CourtUnited States District Courts. 8th Circuit. Northern District of Iowa
Writing for the CourtMARK W. BENNETT
Citation978 F.Supp.2d 974
PartiesMichael J. MEIGHAN, Plaintiff, v. TRANSGUARD INSURANCE COMPANY OF AMERICA, INC., and Transguard General Agency, Inc., Defendants.
Docket NumberNo. C 13–3024–MWB.
Decision Date11 October 2013

978 F.Supp.2d 974

Michael J. MEIGHAN, Plaintiff,
v.
TRANSGUARD INSURANCE COMPANY OF AMERICA, INC., and Transguard General Agency, Inc., Defendants.

No. C 13–3024–MWB.

United States District Court,
N.D. Iowa,
Central Division.

Oct. 11, 2013.


[978 F.Supp.2d 975]


Jackie D. Armstrong, Travis Michael Armbrust, Brown, Kinsey & Funkhouse, PLC, Mason City, IA, for Plaintiff.

Benjamin R. Merrill, Michael Shelby Jones, Patterson Law Firm, Des Moines, IA, for Defendants.


MEMORANDUM OPINION AND ORDER REGARDING DEFENDANT TGA'S MOTION TO DISMISS THE PLAINTIFF'S AMENDED COMPLAINT

MARK W. BENNETT, District Judge.
TABLE OF CONTENTS

I.

INTRODUCTION

975
A.

Meighan's Original Complaint

975
B.

Meighan's Amended Complaint

977
C.

TGA's Motion To Dismiss The Amended Complaint

977


II.

LEGAL ANALYSIS

978
A.

TGA's Challenges To Personal Jurisdiction, Sufficiency Of Process, And Service Of Process

978
B.

TGA's Challenge To The Statement Of Claims

979
1.

Applicable Standards For Dismissal Pursuant To Rule 12(b)(6)

979
2.

Analysis

980
a.

Matters outside the pleadings

980
b.

Plausibility of Meighan's allegations of joint wrongdoing

980
C.

Another Opportunity To Replead Claims

982


III.

CONCLUSION

983

Can an insured remedy his failure to allege any wrongful conduct at all by a defendant insurance agency, on claims of breach of contract and bad faith denial of claims, by the simple expedient of filing an amended complaint that alleges that the defendant insurer and defendant insurance agency individually and jointly engaged in the wrongful conduct at issue and are “jointly and severally liable” for it, and then changing all of the former references to a single defendant to mean both defendants “collectively”? I think not.

I. INTRODUCTION
A. Meighan's Original Complaint

In his original Complaint (docket no. 2), filed May 10, 2013, plaintiff Michael J. Meighan, an independent contractor who drove semi-tractor-trailers for Mid–Seven Transportation, Inc., asserted claims of breach of contract (Count I) and bad faith denials of occupational injury insurance coverage (Count II) against defendants TransGuard Insurance Company of America, Inc., which he identified as “Transguard,” and TransGuard Agency, Inc., which he identified as “TGA.” Meighan

[978 F.Supp.2d 976]

alleged that both Transguard and TGA are incorporated and have their principal places of business out-of-state, so jurisdiction was based on diversity of citizenship. Meighan alleged that he purchased the insurance policy in question, insured by Transguard, through the National Association of Independent Truckers (NAIT), which is the group policy holder, and TGA, as Transguard's authorized agent. The original Complaint expressly alleged misconduct by Transguard, but the only references to TGA in the pleading of the claims were indirect ones that Defendants had no reasonable basis for denying Meighan's claim when the December 1, 2011 notice was issued,” and that Defendants knew or had reason to know on December 1, 2011, that their denial was without a reasonable basis.” Complaint, ¶¶ 34–35 (emphasis added). The insurance contract at issue was not attached to Meighan's original Complaint.

Transguard filed an Answer (docket no. 7) to Meighan's original Complaint on July 31, 2013, denying Meighan's claims and asserting certain affirmative defenses, but did not move to dismiss on the basis of any of these affirmative defenses. On July 22, 2013, however, TGA filed a Motion To Dismiss (docket no. 6), asserting lack of personal jurisdiction, insufficient process, insufficient service of process, and failure to state a claim upon which relief can be granted pursuant to Rule 12(b)(2), (b)(4), (b)(5), and (b)(6) of the Federal Rules of Civil Procedure, respectively. In support of dismissal for lack of personal jurisdiction, TGA asserted that it does not have the necessary contacts with Iowa to support either general or specific personal jurisdiction. In support of dismissal for failure to state a claim, TGA argued that it did not issue the policy in question and that Meighan had alleged that Transguard breached the policy and denied benefits in bad faith, but had not alleged any breach of obligations by TGA as the insurance agency. In support of dismissal for insufficient process and insufficient service of process, TGA argued that, because Meighan had not alleged any tort or contract claim against it, service on the Iowa Secretary of State pursuant to IOWA CODE § 617.3 was not proper service on TGA. TGA attached an Affidavit of its Assistant Vice President in support of its motion, averring that TGA lacks contacts with Iowa, and excerpts of insurance documents for Meighan's occupational accident insurance.

On August 5, 2013, in response to TGA's Motion To Dismiss, Meighan filed an Amended Complaint (docket no. 8), as a matter of course, pursuant to Rule 15(a)(1)(B) of the Federal Rules of Civil Procedure, “to allege that the above named Defendants [identified as Transguard and TGA] individually and jointly breached the contract described herein, denied benefits in bad faith, and intentionally inflicted emotional distress upon Meighan.” Amended Complaint, unnumbered second paragraph. On August 5, 2013, Meighan also filed his Resistance (docket no. 9) to TGA's Motion To Dismiss the original Complaint. In his Resistance, Meighan asserted that he had cured any deficiencies in his original Complaint by filing his Amended Complaint, which he contended included allegations that both defendants are responsible parties under all counts and causes of action. Meighan attached various documents to his Resistance to TGA's Motion To Dismiss, consisting of documents received with his insurance policy, the entire policy, and a corporate family tree of companies owned by Peter R. Kellogg, including Transguard, TGA, and NAIT.

Whether or not Meighan's Amended Complaint actually cures the deficiencies in his original Complaint, I find that

[978 F.Supp.2d 977]

Meighan's filing of the Amended Complaint and TGA's filing of a Motion To Dismiss Plaintiff's Amended Complaint (docket no. 10) moot TGA's original Motion To Dismiss. Therefore, TGA's July 22, 2013, Motion To Dismiss (docket no. 6) is denied as moot.

B. Meighan's Amended Complaint

As mentioned above, Meighan filed his Amended Complaint (docket no. 8) in an attempt to remedy the deficiencies in his original Complaint identified in TGA's Motion To Dismiss. More specifically, after identifying the two defendants, the Amended Complaint adds the following allegations:

3. ... Hereinafter both TransGuard General Agency, Inc. and TransGuard Insurance Company of America, Inc. are referred to collectively as “TransGuard” or “Defendant(s).”

* * *

6. TransGuard has continuous and systematic contacts within the state of Iowa in that it has numerous, ongoing contractual relationships with residents of the state of Iowa.

7. This Court has specific jurisdiction of the causes of action alleged in this Complaint.

Amended Complaint, ¶¶ 3, 6–7. Thereafter, all allegations that formerly identified only one defendant by name or “defendants” have been replaced with “TransGuard” or “Defendants,” meaning both TransGuard Insurance Company (which I will now call TGIC) and TGA. Meighan has also added the following to the “Factual Allegations Common To All Claims”:


19. TransGuard General Agency, Inc. and TransGuard Insurance Company of America, Inc. assumed joint and several responsibility for the payment of insurance benefits and administration of the Policy.

* * *

22. TransGuard General Agency, Inc. and TransGuard Insurance Company of America, Inc. each used the name “TransGuard” to represent their respective corporate identities to the public.

Amended Complaint, ¶¶ 19, 22. Meighan also added an allegation that some portions of his insurance premiums were “comingled” with the assets of Peter R. Kellogg, the shareholder in various private companies, including TGIC and TGA. Meighan's Amended Complaint also adds a third claim, for intentional infliction of emotional distress, based on allegations that a representative of the defendants, who was employed by “IAT Group,” intimidated and attempted to bully Meighan into retracting his claim for benefits. Amended Complaint, Count III.


Meighan did not attach the insurance contract in question to the Amended Complaint, either. The Amended Complaint does refer to Exhibit 2 to Meighan's Resistance to TGA's Motion To Dismiss, however, which Meighan alleges shows private companies, including TGIC, TGA, NAIT, and IAT, in which Peter R. Kellogg is the sole shareholder.

On August 19, 2013, TGIC filed its Answer (docket no. 11) to Meighan's Amended Complaint, again denying Meighan's breach-of-contract and bad-faith claims and adding a denial of his claim of intentional infliction of emotional distress, and again asserting various affirmative defenses. TGIC again did not file any motion to dismiss. TGA, however, once again moved to dismiss Meighan's Amended Complaint.

C. TGA's Motion To Dismiss The Amended Complaint

On August 19, 2013, TGA filed its Motion To Dismiss Plaintiff's Amended Complaint (docket no. 10), asserting essentially the same grounds for dismissal of Meighan's

[978 F.Supp.2d 978]

breach-of-contract and bad-faith claims that it had asserted as to Meighan's original Complaint, thus, denying that Meighan had cured the deficiencies in the pleading of those claims against TGA. TGA's Motion To Dismiss Plaintiff's Amended Complaint adds arguments that emotional distress is not a particularly likely result or natural and probable consequence of ordinary insurance contracts, that emotional distress damages are not available in the context of the denial of insurance benefits, and that Meighan seeks emotional distress damages on the basis of actions of an investigator not employed by TGA. TGA attached no exhibits to its Motion To Dismiss Plaintiff's Amended Complaint, but incorporated by reference materials that it had attached to its original Motion To Dismiss.

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  • De Britto Bucco v. W. Iowa Tech Cmty. Coll., C21-4001-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 16 Agosto 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. Trans Guard Ins. Co. of Am., 978 F.Supp.2d 974, 982 (N.D. Iowa 2013). IV. ANALYSIS Defendants' various motions make similar arguments as to why plaintiffs' claims should be dismissed. As such......
  • Bucco v. W. Iowa Tech Cmty. Coll., C21-4001-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 16 Agosto 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013).IV. ANALYSISDefendants’ various motions make similar arguments as to why plaintiffs’ claims should be dismissed. As such......
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    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 18 Mayo 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013). Rule 12(e) allows a party to move for a more definite statement "of a pleading to which a responsive pleading is allowe......
  • Iowa Voter Alliance v. Black Hawk Cnty., C20-2078-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 27 Enero 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013).IV. DISCUSSIONThe counties argue that plaintiffs (1) lack standing to bring suit and (2) have failed to state any claim ......
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28 cases
  • De Britto Bucco v. W. Iowa Tech Cmty. Coll., C21-4001-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 16 Agosto 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. Trans Guard Ins. Co. of Am., 978 F.Supp.2d 974, 982 (N.D. Iowa 2013). IV. ANALYSIS Defendants' various motions make similar arguments as to why plaintiffs' claims should be dismissed. As such......
  • Bucco v. W. Iowa Tech Cmty. Coll., C21-4001-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 16 Agosto 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013).IV. ANALYSISDefendants’ various motions make similar arguments as to why plaintiffs’ claims should be dismissed. As such......
  • Weems Indus., Inc. v. Teknor Apex Co., C20-108-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 18 Mayo 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013). Rule 12(e) allows a party to move for a more definite statement "of a pleading to which a responsive pleading is allowe......
  • Iowa Voter Alliance v. Black Hawk Cnty., C20-2078-LTS
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • 27 Enero 2021
    ...as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile. Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013).IV. DISCUSSIONThe counties argue that plaintiffs (1) lack standing to bring suit and (2) have failed to state any claim ......
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