Reese v. Progressive Direct Ins. Co.
| Decision Date | 10 February 2023 |
| Docket Number | Civil Action 22-cv-10539-ADB |
| Parties | JESSICA REESE and DAVID MONCADA, on behalf of themselves and all others similarly situated, Plaintiffs, v. PROGRESSIVE DIRECT INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — District of Massachusetts |
MEMORANDUM AND ORDER GRANTING MOTION TO DISMISS
In this putative class action, Jessica Reese (“Reese”) and David Moncada (“Moncada,” collectively “Plaintiffs”) bring suit against Progressive Direct Insurance Company (“Defendant”), alleging breach of contract, violations of Mass. Gen. Laws ch. 93A and Mass. Gen. Laws ch. 176D, § 3(9)(c), (d), (f), and (n), and requesting declaratory judgment. [ECF No. 9 (“Am. Compl”) ¶¶ 107-94]. Pending before the Court is Defendant's motion to dismiss the complaint for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6). [ECF No. 16].
For the reasons set forth below, Defendant's motion to dismiss [ECF No. 16], is GRANTED.
The following relevant facts are taken primarily from the amended complaint, which the Court assumes to be true when considering a motion to dismiss. Ruivo v. Wells Fargo Bank, N.A., 766 F.3d 87, 90 (1st Cir. 2014). The Court also considers the Massachusetts Automobile Insurance Policy 2016 Edition, [ECF No. 18-1], because the document's authenticity is not disputed and it is central to resolving Plaintiffs' claims. Barry v. UMass Mem'l Med. Ctr., Inc., 245 F.Supp.3d 323, 324 n.1 (D. Mass. 2017) (citing Curran v. Cousins, 509 F.3d 36, 44 (1st Cir. 2007); see also Clorox Co. P. R. v. Proctor & Gamble Com. Co., 228 F.3d 24, 32 (1st Cir. 2000) () (internal citations and quotation marks omitted).
The alleged facts underlying this action are quite limited. On October 24, 2019, Reese's vehicle was damaged in a collision with one of Defendant's insureds. . Following the accident, Defendant determined that its insured's insurance policy (the “2016 Standard Policy”), covered the loss. [Id. ¶ 9]. Subsequently, on September 28, 2020, Moncada's vehicle was involved in a separate motor vehicle collision, which was caused by the negligence of another of Defendant's insureds. [Id. ¶¶ 50-51, 53]. After the crash, Defendant again determined that the insured's policy, also the 2016 Standard Policy, covered the loss. [Id. ¶ 56].
The relevant provision of the 2016 Standard Policy, Part 4 (“Damage to Someone Else's Property”), provides as follows:
Under this Part, we will pay damages to someone else whose auto or other property is damaged in an accident. The damages we will pay are the amounts that person is legally entitled to collect for property damage through a court judgment or settlement. We will pay only if you or a household member is legally responsible for the accident. We will also pay if someone else using your auto with your consent is legally responsible for the accident. Damages include any applicable sales tax and the costs resulting from the loss of use of the damaged property. The amount we will pay does not include compensation for physical damage to your auto or towing or recovery of your auto or any decreased value or intangible loss claimed to result from the property damage unless otherwise required by law.
[ECF No. 18-1 at 10]. The policy also provides, in the “Legal Action Against Us” subsection of the “General Provisions and Exclusions” section:
We may not be sued for payment under . . . Damage to Someone Else's Property (Part 4) . . . until the obligation to pay, of a person seeking or entitled coverage . . ., is finally determined by judgment after trial against that person, or by written agreement between that person, the claimant, and us. No one will have the right to make us a party to a lawsuit to determine the liability of a person seeking or entitled to coverage.
Defendant made payments to Plaintiffs under Part 4 of the Policy, [ ], but did not pay Plaintiffs for the “inherent diminished value” (“IDV”) of their vehicles as a result of the accidents, [id. ¶¶ 26, 37-39, 73, 84-86]. IDV accounts for the fact that a vehicle that has been involved in a collision and suffered damage is worth less on the resale market than a comparable vehicle that has not suffered damage, even after that damage is repaired. [Id. ¶ 20]. Reese and Moncada thereafter filed requests for their vehicles' IDV on, respectively, March 2 and March 22, 2021, [id. ¶¶ 10, 57-58], which Defendant denied, [id. ¶¶ 37, 73].
Reese filed the initial complaint in Essex Country Superior Court on March 10, 2022, [ECF No. 1 ¶ 1], and Defendant removed the case to this Court on April 12, 2022, [id. at 1]. On June 17, 2022, Reese and Moncada filed the amended complaint, which added Moncada as a plaintiff and brought additional claims. [Am. Compl.]. Defendant moved to dismiss the amended complaint on August 26, 2022, [ECF No. 16], and Plaintiffs opposed the motion on September 9, 2022, [ECF No. 19].
On a motion to dismiss for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6), the Court must accept as true all well-pled facts, analyze those facts in the light most favorable to the plaintiffs, and draw all reasonable inferences from those facts in favor of the plaintiffs. United States ex rel. Hutcheson v. Blackstone Med., Inc., 647 F.3d 377, 383 (1st Cir. 2011). Additionally, “a court may not look beyond the facts alleged in the complaint, documents incorporated by reference therein and facts susceptible to judicial notice.” MIT Fed. Credit Union v. Cordisco, 470 F.Supp.3d 81, 84 (D. Mass. 2020) (citing Haley v. City of Boston, 657 F.3d 39, 46 (1st Cir. 2011)).
A complaint “must provide ‘a short and plain statement of the claim showing that the pleader is entitled to relief,'” Cardigan Mountain Sch. v. N.H. Ins. Co., 787 F.3d 82, 84 (1st Cir. 2015) (quoting Fed.R.Civ.P. 8(a)(2)), and must “set forth factual allegations, either direct or inferential, respecting each material element necessary to sustain recovery under some actionable legal theory,” Gooley v. Mobil Oil Corp., 851 F.2d 513, 515 (1st Cir. 1988). Although detailed factual allegations are not required, a complaint must set forth “more than labels and conclusions,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007), and “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Rather, a complaint “must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Id. (quoting Twombly, 550 U.S. at 570).
As courts in this District and the Commonwealth have acknowledged, “[t]he interpretation of an insurance policy is a question of law.” Merullo v. Amica Mutual Ins. Co., No. 22-cv-10410, 2022 WL 17417717, *2 (D. Mass. Dec. 5, 2022) appeal docketed, No. 231005 (1st Cir. Jan. 3, 2023) (quoting Mass. Insurers Insolvency Fund v. Premier Ins. Co., 869 N.E.29 576, 581 (Mass. 2007)). In construing an insurance policy, we must first consider “the actual language of the policies, given its plain and ordinary meaning.” Clark Sch. for Creative Learning, Inc. v. Phila. Indem. Ins. Co., 734 F.3d 51, 55 (1st Cir. 2013) (quoting Brazas Sporting Arms, Inc. v. Am. Empire Surplus Lines Ins. Co., 220 F.3d 1, 4 (1st Cir. 2000)). “A policy of insurance whose provisions are plainly and definitely expressed in appropriate language must be enforced in accordance with its terms.” Clark Sch. for Creative Learning, Inc., 734 F.3d at 55 (quoting Cody v. Conn. Gen. Life Ins. Co., 439 N.E.2d 234, 237 (Mass. 1982)). In interpreting the contract, the Court is “guided by ‘what an objectively reasonable insured, reading the relevant policy language, would expect to be covered.'” McGilloway v. Safety Ins. Co., 174 N.E.3d 1191, 1196 (Mass. 2021) (quoting Hazen Paper Co. v. U.S. Fid. & Guar. Co., 555 N.E.2d 576, 583 (Mass. 1990)).
Despite the plain terms of the relevant policy language excluding third-party recovery of IDV claims, Plaintiffs allege that Defendant is nonetheless liable for such claims. [ECF No. 19 at 4-10]. The Court disagrees. Although the Massachusetts Supreme Judicial Court (“SJC”) has previously interpreted a Massachusetts standard insurance policy that did not explicitly exclude recovery for IDV damages to provide for such damages, see McGilloway, 174 N.E.3d at 1197, the standard insurance policy at issue here expressly excludes IDV damages. Compare [ECF No. 18-1 at 10] with McGilloway, 174 N.E.3d at 1199. Specifically, the last sentence of the first paragraph of Part 4 of the 2016 Standard Policy states that “[t]he amount we will pay does not include compensation for . . . any decreased value or intangible loss claimed to result from the property damage unless otherwise required by law.” [ECF No. 18-1 at 10]. The Court finds that the policy's plain language is unambiguous and concludes that the policy does not provide for third-party recovery of IDV damages. Accord Merullo, 2022 WL 17417717 at *2-3.
Plaintiffs argue that notwithstanding the policy's express exclusion of coverage for IDV damages, Mass. Gen. Laws ch. 90, § 34O mandates such coverage. “Massachusetts requires automobile insurers to use standard policies.” Martins v. Vt. Mutual Ins. Co., 411 F.Supp.3d 166 169 (D. Mass. 2019) (citing Colby...
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