Jenkins, et al v. State Farm Fire and Casualty Company, Inc.
MEMORANDUM OPINION AND ORDER directing that the Defendant's 4 Motion for Partial Dismissal is GRANTED, and Plaintiff's fraud claim (Doc. 1 , Ex. 1, at 9-10) is DISMISSED with prejudice. Signed by Chief Judge William Keith Watkins on 8/4/11. (scn, )
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
and CRAIG JENKINS,
) CASE NO. 2:11-CV-350-WKW [WO]
STATE FARM FIRE AND CASUALTY )
MEMORANDUM OPINION AND ORDER
This action arises out of a dispute about a damaged swimming pool and a
homeowner’s insurance policy. Before the court is a motion to dismiss the fraud
count of the Complaint (Doc. # 4), filed by Defendant State Farm Fire and Casualty
Company (“State Farm”). Plaintiff Marcella Jenkins (“Mrs. Jenkins”) filed a response
brief (Doc. # 7), to which State Farm filed a reply (Doc. # 10). Craig Jenkins (“Mr.
Jenkins”), also a party to the homeowner’s insurance policy, was previously joined as
a plaintiff by court order (Doc. # 11). Following that order and a subsequent show
cause order, Mr. Jenkins appeared in this action and adopted Mrs. Jenkins’s Complaint
and response in opposition to the motion to dismiss.1 (Doc. # 13.) For the reasons
that follow, State Farm’s motion to dismiss the fraud count is due to be granted.
Therefore, the claims in the Complaint are referred to as belonging collectively to Mr.
and Mrs. Jenkins.
I. JURISDICTION AND VENUE
State Farm removed this case to federal court on May 6, 2011, and Mrs. Jenkins
did not timely challenge the removal. (Doc. # 1.) Subject matter jurisdiction is
exercised pursuant to 28 U.S.C. §1332(a). Personal jurisdiction and venue are not
contested, and there are adequate allegations of both.
II. STANDARD OF REVIEW
A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint against
the legal standard set forth in Rule 8: “a short and plain statement of the claim
showing that the pleader is entitled to relief,” Fed. R. Civ. P. 8(a)(2). In ruling on a
motion to dismiss, courts “must accept the well pleaded facts as true and resolve them
in the light most favorable to the plaintiff.” Paradise Divers, Inc. v. Upmal, 402 F.3d
1087, 1089 (11th Cir. 2005) (citation and internal quotation marks omitted); see also
Watts v. Fla. Int’l Univ., 495 F.3d 1289, 1295 (11th Cir. 2007) (“We have held many
times when discussing a Rule 12(b)(6) motion to dismiss, that the pleadings are
construed broadly, and that the allegations in the complaint are viewed in the light
most favorable to the plaintiff.” (internal citations and quotation marks omitted)).
To survive Rule 12(b)(6) scrutiny, however, “a complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible
on its face.’” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atl. Corp.
v. Twombly, 550 U.S. 544, 570 (2007)). “Determining whether a complaint states a
plausible claim for relief [is] . . . a context-specific task that requires the reviewing
court to draw on its judicial experience and common sense.” Id. at 1950 (citation
omitted). If there are “enough fact[s] to raise a reasonable expectation that discovery
will reveal evidence” to support the claim, there are “plausible” grounds for recovery,
and a motion to dismiss should be denied. Twombly, 550 U.S. at 556. The claim can
proceed “even if it strikes a savvy judge that actual proof of those facts is improbable,
and that a recovery is very remote and unlikely.” Id. (citation and internal quotation
Mr. and Mrs. Jenkins, Alabama citizens, bring breach-of-contract, fraud, and
bad faith claims against State Farm. (Doc. # 1, Ex. A, 8-11 (“Compl.”).) Only their
fraud claim is at issue on this motion.
State Farm issued Mr. and Mrs. Jenkins a homeowner’s insurance policy (the
“Policy”) that was effective from September 23, 2009 to September 23, 2010.
(Compl. ¶ 3.) The Policy provided homeowner’s insurance coverage for their home,
as well as the outer extensions and surrounding areas of the home. (Compl. ¶ 3.)
On or about June 30, 2010, a pipe connected to Mr. and Mrs. Jenkins’s
swimming pool burst, flooding the area surrounding the home and garden with water.
(Compl. ¶ 4.) The burst pipe also caused substantial damage to the pool’s liner and
other components. (Compl. ¶ 4.) In early July 2010, Mr. and Mrs. Jenkins filed a
claim with State Farm seeking compensation for the loss resulting from the damaged
pipe, to include damage to their home, land, swimming pool “apparatus,” and other
items. (Compl. ¶ 5.) Following their claim, and at the request of State Farm, multiple
companies came to the property to inspect the damage resulting from the damaged
pipe. (Compl. ¶ 6.) The companies’ inspections found that the damage to their pool
was caused by a sudden bursting of a pipe connected to the pool. (Compl. ¶ 7.) Mr.
and Mrs. Jenkins complied with every request from State Farm in connection with
processing their claim. (Compl. ¶ 7.) However, State Farm refused “to process a
valid claim.” (Compl. ¶ 8, 12.)
Mr. and Mrs. Jenkins’s claims are that State Farm is liable for: (1) breach of
contract (Compl. ¶ 12); (2) fraud (Compl. ¶ 14); and (3) failure to act in good faith
(Compl. ¶ 16). They also seek declaratory relief stating that they have “a right to be
compensated for covered loss or damage to [their] property pursuant to the terms and
conditions of said policy.” (Compl. ¶ 10.) They seek compensatory and punitive
damages, attorney’s fees, and costs. (Compl. 11.) A jury trial is also demanded.
State Farm contends that Mr. and Mrs. Jenkins’s fraud claim is due to be
dismissed because it was not pleaded with sufficient particularity in compliance with
Rule 9(b) of the Federal Rules of Civil Procedure, and because their fraud claim fails
as a matter of law. (Doc. # 4, 3-6; Doc. # 10, 2-3.) Mr. and Mrs. Jenkins respond that
they have sufficiently pled a fraud claim under Alabama law, and that Alabama
pleading requirements, not federal pleading requirements, control. (Doc. # 7, 1-3.)
Because their fraud claim sounds in fraud in the performance of a contract, it is due
to be dismissed under Alabama law.
A claim of ordinary fraud is in fact a claim of fraudulent misrepresentation.
U.S. Diagnostic, Inc. v. Shelby Radiology, P.C., 793 So. 2d 714, 720-21 (Ala. 2000),
overruled on other grounds by Bruce v. Cole, 854 So. 2d 47, 58 (Ala. 2003). The
elements of a fraudulent misrepresentation claim are: (1) a false representation;
(2) concerning a material fact; (3) plaintiff’s reliance on the false representation; and
(4) actual injury resulting from that reliance. See Consol. Constr. Co. of Ala. v. Metal
Bldg. Components, L.P., 961 So. 2d 820, 825 (Ala. 2007). However, “[a] mere failure
to perform a contract obligation is not a tort, and it furnishes no foundation for an
action on the case.” C & C Prods., Inc. v. Premier Indus. Corp., 275 So. 2d 124, 130
(Ala. 1974). In Brown-Marx Assocs., Ltd. v. Emigrant Savs. Bank, 703 F.2d 1361
(11th Cir. 1983), applying Alabama law, the Eleventh Circuit similarly explained that
a “[f]ailure to perform a promise is not of itself adequate evidence of intent to support
an action for fraud. A mere breach of a contractual provision is not sufficient to
support a charge of fraud.” Id. at 1370-71; see also Dickinson v. Land Developers
Constr. Co., 882 So. 2d 291, 303-06 (Ala. 2003) (Houston, J., concurring) (“[I]t is
clear that to assert a fraud claim that stems from the same general facts as one’s
breach-of-contract claim, the fraud claim must be based on representations
independent from the promises in the contract and must independently satisfy the
elements of fraud.” (emphasis omitted)).
In their response to State Farm’s motion to dismiss, Mr. and Mrs. Jenkins
describe the fraud claim:
[T]he Defendant falsely misrepresented to [Mr. and] Mrs. Jenkins that if [they]
purchased a homeowner policy and paid [their] premiums (both of which are
material facts), [they] would be financially compensated for any loss or damage
to [their] real and personal property that is covered under the terms and
conditions of [their] insurance policy, and that a valid claim, once filed with
State Farm, would yield this result. This misrepresentation was reasonably
relied upon by [Mr. and] Mrs. Jenkins in September 2009 (the beginning of the
policy in question) and [they] subsequently paid multiple insurance premiums,
much to [their] financial detriment, only to not have a valid insurance claim
processed and adjusted by the Defendant that would have and should have
resulted in coverage under the policy.
(Doc. # 7, at 2-3 (emphasis added).) Mr. and Mrs. Jenkins’s fraud claim is solely
premised on State Farm’s promise to perform under the contract, to financially
compensate them for any loss or damage to their property under certain conditions,
and State Farm’s subsequent breach of that promise by not processing and paying a
valid claim. Thus, State Farm’s fraud in the performance of the contract does not, in
and of itself, give rise to a fraud claim, unless “there is damage due to fraud that is
separate from damages that may result from any subsequent contractual breach.”
Dickinson, 882 So. 2d at 305 (internal citation and quotations marks omitted).
However, the fraud claim does not allege any damage separate from the damage
resulting from State Farm’s alleged breach of the insurance contract. Accordingly,
Mr. and Mrs. Jenkins’s fraud claim fails as a matter of law. Therefore, the court need
not address the sufficiency of their fraud pleadings under the Federal Rules of Civil
Finally, based on the documents attached to the Jenkins’s Complaint and their
remaining allegations, it would likely be futile to allow amendment of their fraud
It is ORDERED that Defendant’s Motion for Partial Dismissal (Doc. # 4) is
GRANTED, and Plaintiffs’ fraud claim (Doc. # 1, Ex. 1, at 9-10) is DISMISSED with
DONE this 4th day of August, 2011.
/s/ W. Keith Watkins
CHIEF UNITED STATES DISTRICT JUDGE
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