Trustmark Ins. Co. v. C&k Mkt. Inc

• Decision Date: 10 February 2011
• Docket Number: No. CV 10-465-MO,CV 10-465-MO
• Court: U.S. District Court — District of Oregon
• Parties: TRUSTMARK INSURANCE COMPANY, an Illinois corporation, Plaintiff, v. C&K MARKET, INC., an Oregon corporation, Defendant.

TRUSTMARK INSURANCE COMPANY, an Illinois corporation, Plaintiff,

v.C&K MARKET, INC., an Oregon corporation, Defendant.

No. CV 10-465-MO

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

Dated: February 10, 2011

OPINION AND ORDER

MOSMAN, J.,

Trustmark Insurance Company ("Trustmark") moves to strike an affirmative defense pled by C&K Market, Inc. ("C&K") in this insurance dispute. C&K purchased stop-loss insurance from Trustmark through a policy that required 80% participation in the plan. Trustmark brought this action to rescind the contract because this 80% threshold has not been met. In its answer C&K pled seventeen affirmative defenses with little or no supporting facts. The question before the court is whether the plausibility standard announced in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007), and Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949-50 (2009), applies to affirmative defenses. I hold that it does not.

DISCUSSION

Before Twombly, pleading standards in a complaint were governed by Conley v. Gibson, 355 U.S. 41 (1957). In Wyshak v. City National Bank, 607 F.2d 824, 827 (9th Cir. 1979) (per curiam), the standard used in Conley was extended to affirmative defenses. Twombly announced

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a new pleading standard for complaints, the plausibility standard, but did not discuss affirmative defenses. 550 U.S. at 570. Some district courts have extended Twombly to affirmative defenses, and some have not. Compare Peterson v. Acumed, LLC, No. CV-10-586, 2010 WL 5158542 at *3 (D. Or. Dec. 14, 2010) (applying Twombly to affirmative defenses); Barnes v. AT & T Pension Ben. Plan-Nonbargained Program, 718 F. Supp. 2d 1167, 1171 (N.D. Cal. 2010) (same); Hayne v. Green Ford Sales, Inc., 263 F.R.D. 647, 649-52 (D. Kan. 2009) (same), with First Nat'l Ins. Co. of Am. v. Camps Servs, Ltd., No. 08-cv-12805, 2009 WL 22861, at *2 (E.D. Mich. Jan. 5, 2009) (declining to extend Twombly to affirmative defenses); Romantine v. CH2M Hill Eng'rs, Inc., No. 09-973, 2009 WL 3417469, at *1 (W.D. Pa. Oct. 23, 2009) (same).

While I recognize that the state of the law may be shifting, I remain bound by current Ninth Circuit precedent. Until Wyshak is overruled I am bound to follow it. Therefore, I decline to extend the plausibility pleading requirements of Twombly to affirmative defenses. I find that affirmative defense #15 meets the notice requirement of Wyshak, so I DENY Trustmark's Motion to Strike affirmative defense #15.

DATED this 10th day of February, 2011.

MICHAEL W. MOSMAN

United States District Court