Painsolvers Inc v. State Farm Mut. Auto. Ins. Co.

• Decision Date: 22 January 2010
• Docket Number: Civil No. 09-00429 ACK-KSC.
• Citation: 685 F.Supp.2d 1123
• Parties: PAINSOLVERS, INC., Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an entity, form unknown; Does 1-30, Defendant.
• Court: U.S. District Court — District of Hawaii

685 F.Supp.2d 1123

PAINSOLVERS, INC., Plaintiff,

v.STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an entity, form unknown; Does 1-30, Defendant.

Civil No. 09-00429 ACK-KSC.

United States District Court, D. Hawai'i.

Decided: Jan. 22, 2010.

COPYRIGHT MATERIAL OMITTED

Stephen M. Shaw, Honolulu, HI, for Plaintiff.

David R. Harada-Stone, Patricia K Wall, Richard B. Miller, Tom Petrus &amp Miller, LLC, Honolulu, HI, for Defendant.

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS COUNTS ONE THROUGH SIX AND COUNT NINE OF THE FIRST AMENDED COMPLAINT AND (2) DENYING PLAINTIFF'S CROSS MOTION FOR SUMMARY JUDGMENT AND ADJUDICATION OR PRELIMINARY INJUNCTION

ALAN C. KAY, Senior District Judge.

PROCEDURAL BACKGROUND

On May 20, 2009, Plaintiff Painsolvers Inc., a professional corporation authorized to provide personal injury protection ("PIP") benefits to claimants in the state of Hawai'i, filed a complaint against Defendant, State Farm Mutual Automobile Insurance Company ("State Farm") in the Circuit Court of the First Circuit in Hawai'i alleging that State Farm had failed to pay two claims for PIP benefits. On July 14, 2009, Defendant State Farm filed a motion to dismiss Painsolvers' complaint in state court. On September 4, 2009, Plaintiff filed a First Amended Complaint alleging that State Farm had refused to pay over twelve (12) PIP benefit claims and added claims for trade libel or disparagement and slander, as well as an additional prayer for general, special, and punitive damages.¹ First Am. Compl. ¶¶ 7-8, 4047, fifth prayer for relief (hereinafter "Compl.")

On September 11, 2009, Defendant State Farm removed the case to this Court pursuant to 28 U.S.C. §§ 1441 and 1446. The Court has original jurisdiction over this case pursuant to 28 U.S.C. § 1332 (diversity of citizenship). On September 18, 2009 Defendant moved to dismiss Counts One through Six and Count Nine of Plaintiffs First Amended Complaint for failure to state a claim. On November 30, 2009 Plaintiff opposed Defendant's Motion to Dismiss and filed a Counter Motion for Summary Judgment and Adjudication or Preliminary Injunction. On January 05, 2010, Defendant filed a memorandum combining its reply in support of its motion to dismiss and its opposition to Plaintiffs counter motion for summary judgment and adjudication or preliminary injunction. On January 11, 2010, Plaintiff filed its reply memorandum in support of its counter motion for summary judgment and adjudication or preliminary injunction.

FACTUAL BACKGROUND²

At relevant times, Plaintiff, Painsolvers, Inc., was a professional corporation authorized to provide personal injury protection ("PIP") benefits to claimants covered by motor vehicle insurance policies in the State of Hawai'i. Compl. ¶ 1. Defendant, State Farm Mutual Automobile Insurance Company, is an insurance company organized under the laws of the State of Illinois, with its principal place of business in Bloomington, Illinois, and is authorized to transact business in Hawai'i. Compl. ¶ 2; Notice of Removal ¶ 1. Plaintiff Painsolvers, Inc., alleges it submitted over twelve (12) PIP claims on forms approved by an agency of the United States government (CMS-1500, Health Insurance Claim Form) to Defendant State Farm.³ Compl. ¶¶ 7-8. Plaintiff alleges that State Farm has not paid these claims and continues to refuse payment on these claims. Id. Plaintiff alleges that the claims, interest, costs, and attorney's fees exceed $10,000.00. Compl. ¶ 8. For at least two of the claims, State Farm alleges that it properly requested additional information from Plaintiff in order to process the claims and that Plaintiff has not provided the requested information. Mot. to Dismiss at 2. Plaintiff alleges that "Defendants are ignoring information on the claim forms and attachments which is sufficient to pay the claims." Compl. ¶12. Plaintiffs First Amended Complaint is divided into three "Claims:" (1) "First Claim—For Payment of Claims, Interest, Costs and Attorney's Fees" (Compl. at 3); (2) "Second ClaimTrade Libel or Disparagement" (Compl. at 7) and; (3) "Third Claim—Slander" (Compl. at 8.) Within the "First Claim, " Plaintiff lists nine "counts." Defendant moves to dismiss only counts one through six and count nine of the "First Claim."

STANDARD

I. Motion to Dismiss for Failure to State a Claim

Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)") permits dismissal of a complaint that fails "to state a claim upon which relief can be granted." Under Rule 12(b)(6), review is generally limited to the contents of the complaint. Sprewell v Golden State Warriors, 266 F.3d 979, 988 (9th Cir.2001); Campanelli v. Bockrath, 100 F.3d 1476, 1479 (9th Cir.1996). Courts may also "consider certain materials—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." United States v. Ritchie, 342 F.3d 903, 908 (9th Cir.2003). Documents whose contents are alleged in a complaint and whose authenticity are not questioned by any party may also be considered in ruling on a Rule 12(b)(6) motion to dismiss. See Branch v. Tunnell, 14 F.3d 449, 453-54 (9th Cir. 1994).

On a Rule 12(b)(6) motion to dismiss, all allegations of material fact are taken as true and construed in the light most favorable to the nonmoving party. Fed'n of African Am. Contractors v. City of Oakland, 96 F.3d 1204, 1207 (9th Cir.1996). However, conclusory allegations of law, unwarranted deductions of fact, and unreasonable inferences are insufficient to defeat a motion to dismiss. See Sprewell, 266 F.3d at 988; Nat'l Assoc. for the Advancement of Psychoanalysis v. Cal. Bd. of Psychology, 228 F.3d 1043, 1049 (9th Cir.2000); In re Syntex Corp. Sec. Litig., 95 F.3d 922, 926 (9th Cir.1996). Moreover, the court need not accept as true allegations that contradict matters properly subject to judicial notice or allegations contradicting the exhibits attached to the complaint. Sprewell, 266 F.3d at 988.

As the Ninth Circuit has stated, "[t]he issue is not whether a plaintiff's success on the merits is likely but rather whether the claimant is entitled to proceed beyond the threshold in attempting to establish his claims." De La Cruz v. Tormey, 582 F.2d 45, 48 (9th Cir.), cert, denied, 441 U.S. 965, 99 S.Ct. 2416, 60 L.Ed.2d 1072 (1979). The court must determine whether or not it appears to a certainty under existing law that no relief can be granted under any set of facts that might be proved in support of a plaintiff's claims. Id.

In summary, to survive a Rule 12(b)(6) motion to dismiss, "[fjactual allegations must be enough to raise a right to relief above the speculative level... on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Bell ML Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1965, 167 L.Ed.2d 929 (2007) (internal citations and quotations omitted). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations... a plaintiff's obligation to provide the 'grounds' of his 'entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. at 1964 (internal citations and quotations omitted). Dismissal is appropriate under Rule 12(b)(6) if the facts alleged do not state a claim that is "plausible on its face." Id. at 1973.

II. Motion for Summary Judgment

The purpose of summary judgment is to identify and dispose of factually unsupported claims and defenses. See Celotex Corp. v. Catrett, All U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is therefore appropriate if the "pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). "A fact is 'material' when, under the governing substantive law, it could affect the outcome of the case. A 'genuine issue' of material fact arises if 'the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Thrifty Oil Co. v. Bank of Am Nat'l Trust & Sav. Ass'n, 322 F.3d 1039, 1046 (9th Cir.2003) (quoting Anderson v. Liberty Lobby, Inc., All U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)) (citation omitted).⁴ Conversely, where the evidence could not lead a rational trier of fact to find for the nonmoving party, no genuine issue exists for trial. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 415 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

The moving party has the burden of persuading the court as to the absence of a genuine issue of material fact. Celotex All U.S. at 323, 106 S.Ct. 2548; Miller v. Glenn Miller Prod., Inc., 454 F.3d 975, 987 (9th Cir.2006) The moving party may do so with affirmative evidence or by " 'showing'—that is pointing out to the district court—that there is an absence of evidence to support the nonmoving party's case." Celotex, All U.S. at 325, 106 S.Ct. 2548.⁵Once the moving party satisfies its burden, the nonmoving party cannot simply rest on the pleadings or argue that any disagreement or "metaphysical doubt" about a material issue of fact precludes summary judgment. See id. at 323, 106 S.Ct. 2548; Matsushita Elec, 475 U.S. at 586, 106 S.Ct. 1348; Cal. Arch. Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir.1987).⁶ The nonmoving party must instead set forth "significant probative evidence" in support of its position. T.W. Elec. Serv. v. Pac Elec. ContractorsAss'n, 809 F.2d 626, 630 (9th Cir.1987). Summary judgment will thus be granted against a party who fails to demonstrate facts sufficient to establish an element essential to his case when that party will ultimately bear the burden of proof at trial. See Celotex, All U.S. at 322, 106 S.Ct....