Philippou et al v. American National Property and Casualty Company

Filing 23

MEMORANDUM OPINION AND ORDER that def's 19 MOTION TO DISMISS as to Count II is GRANTED, and plfs' claim for emotional distress is DISMISSED with prejudice; further ORDERING that plf's stipulation to the dismissal of counts IV (ne gligence), V (recklessness and wantonness), and VI (gross negligence) 10 , which the court construes as a motion to amend the complaint to remove those claims, is hereby GRANTED pursuant to Fed. R. Civ. R. 15(a)(2); This case will proceed henceforth only on plaintiffs' breach of contract (count I) and bad faith (count III) claims 1 . Signed by Honorable Judge Susan Russ Walker on 5/16/17. (Attachments: # 1 civil appeals checklist).(djy, )

IN THE DISTRICT COURT OF THE UNITED STATES
FOR THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DIVISION
PHILIP PHILIPPOU, et al.
Plaintiffs,
v.
AMERICAN NATIONAL PROPERTY &
CASUALTY COMPANY,
Defendant.

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CASE NO. 2:16-cv-695-SRW

MEMORANDUM OPINION AND ORDER
This matter is before the court on defendant’s motion to dismiss plaintiffs’ claim for
intentional infliction of emotional distress, which is set out in count II of the original
complaint. (Doc. 19). Plaintiff filed a response to the motion (Doc. 21) and defendant
replied (Doc. 22). Upon review of the motion and the record, the court concludes that the
motion is due to be granted.
MOTION TO DISMISS STANDARD
A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint against the
legal standard set forth in Rule 8, which requires “a short and plain statement of the claim
showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). In evaluating a motion
to dismiss pursuant to Rule 12(b)(6), the court must take “the factual allegations in the
complaint as true and construe them in the light most favorable to the plaintiff.” Pielage
v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). However, “the tenet that a court must
accept as true all of the allegations contained in a complaint is inapplicable to legal

conclusions.” Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). “[A] plaintiff’s obligation to
provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and
conclusions, and a formulaic recitation of the elements of a cause of action will not do.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).
“To survive a motion to dismiss, a complaint must contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is plausible on its face.’” Iqbal, 556 U.S. at
678 (quoting Twombly, 550 U.S. at 570). “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 663 (alteration in original)
(citation omitted). “[F]acial plausibility” exists “when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). The standard also “calls for
enough facts to raise a reasonable expectation that discovery will reveal evidence” of the
claim. Twombly, 550 U.S. at 556. While the complaint need not set out “detailed factual
allegations,” it must provide sufficient factual amplification “to raise a right to relief above
the speculative level.” Id. at 555.
“So, when the allegations in a complaint, however true, could not raise a claim of
entitlement to relief, ‘this basic deficiency should … be exposed at the point of minimum
expenditure of time and money by the parties and the court.’” Twombly, 550 U.S. at 558
(quoting 5 Wright & Miller § 1216, at 233–34) (quoting, in turn, Daves v. Hawaiian
Dredging Co., 114 F. Supp. 643, 645 (D. Haw. 1953))). “[O]nly a complaint that states a

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plausible claim for relief survives a motion to dismiss.” Iqbal, 556 U.S. at 679 (citing
Twombly, 550 U.S. at 556).
BACKGROUND
Plaintiffs commenced this action based upon an insurance contract on their
residential property. (Doc. 1 at 2). The complaint alleges claims against defendant, the
insurer, for breach of contract (count I); intentional infliction of emotional distress or
“outrage” (count II); bad faith (count III); negligence (count IV); recklessness and
wantonness (count V); and gross negligence (count VI). (Doc. 1 at 4–6). Defendant filed
a motion to dismiss the claims for intentional infliction of emotional distress, negligence,
recklessness and wantonness, and gross negligence. (Doc. 6 at 2). In response, plaintiffs
stipulated to the dismissal of counts IV, V and VI and requested leave to amend their count
II claim for intentional infliction of emotional distress. (Doc. 10). The court granted leave
to amend (Doc. 13) and plaintiffs filed an amended claim for intentional infliction of
emotional distress (Doc. 15). Defendant’s motion to dismiss count II followed. (Doc. 19).
In their amendment to count II, plaintiffs allege that “because their home was
damaged to the point of being uninhabitable … the claim under their insurance policy with
the Defendant is tied to matters of mental concern.” (Doc. 15 at 1). They contend that “the
conduct and/or methods used by Defendant through its employees[,] agents and
representatives were so barbaric and beyond such decency, it was foreseeable by its actions
to cause mental anguish.” (Doc. 15 at 1). The conduct complained of includes defendant’s
alleged refusal to cooperate in settling plaintiffs’ claim, “fraud by representing the
condition caused by the events to be pre-existing thus causing further delays,” “[r]efusing

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to timely pay additional living expenses,” and “[b]reaching the insurance contract between
the parties by … failing and refusing to pay benefits thereunder as to reasonably result in
mental anguish.” (Doc. 15 at 2).
Defendant’s motion to dismiss contends that these facts are insufficient to establish
a claim for intentional infliction of emotional distress. (Doc. 19 at 2). Plaintiffs’ response
maintains that defendant breached the insurance contract and thereby inflicted emotional
distress, and that Alabama law recognizes an intentional infliction of emotional distress
theory of liability under breach of contract claims. (Doc. 21 at 3). The court finds that,
based upon the bare assertions in the amended complaint, plaintiffs have not alleged a
factual basis for a claim of intentional infliction of emotional distress that is sufficient to
survive a motion to dismiss. The claim is due to be dismissed.
DISCUSSION
The Supreme Court of Alabama recognizes the tort of outrage, but has stated that
“[t]he tort of outrage is an extremely limited cause of action. It is so limited that this Court
has recognized it in regard to only three kinds of conduct: (1) wrongful conduct in the
family-burial context, (2) barbaric methods employed to coerce an insurance settlement,
and (3) egregious sexual harassment.” Little v. Robinson, 72 So. 3d 1168, 1172 (Ala. 2011)
(quoting Potts v. Hayes, 771 So. 2d 462, 465 (Ala. 2000) (internal quotation marks and
citations omitted)). The Alabama Supreme Court has cautioned that recovery is not meant
to be limited only to these three circumstances, but also emphasized that “[i]t is clear …
that the tort of outrage is viable only when the conduct is so outrageous in character and so
extreme in degree as to go beyond all possible bounds of decency, and to be regarded as

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atrocious and utterly intolerable in a civilized society.” Id. at 1173 (quoting Horne v. TGM
Assocs., L.P., 56 So. 3d 615, 631 (Ala. 2010) (internal quotation marks omitted)).
To recover based on a claim of intentional infliction of emotional distress, “a
plaintiff must demonstrate that the defendant’s conduct ‘(1) was intentional or reckless; (2)
was extreme and outrageous; and (3) caused emotional distress so severe that no reasonable
person could be expected to endure it.’” Id. at 1172 (internal citation omitted). The
“minimum threshold that a defendant must cross in order to commit outrageous conduct”
in the insurance context includes “a concerted pattern of delays in order to cause distress
to [the plaintiff] and to pressure him into accepting a settlement.” State Farm Auto Ins.
Co. v. Morris, 612 So. 2d 440, 443 (Ala. 1993). Even when a delay in payment causes a
plaintiff concern about a financial condition, absent a showing of improper motive or intent
to cause severe emotional distress, the conduct is not sufficient to demonstrate outrageous
conduct. Id.
Plaintiffs’ sole claim of outrageous behavior by defendant is the statement that
defendant’s conduct was “so barbaric and beyond such decency, it was foreseeable by its
actions to cause mental anguish.” (Doc. 15 at 1). This statement is little more than a
formulaic recitation of the type of conduct that must be shown in order to recover for
outrage, without supporting factual allegations. However, vague and conclusory
allegations are not sufficient to support a claim of outrage. See Iqbal, 556 U.S. at 678 (“A
pleading that offers ‘labels and conclusions’ or ‘a formulaic recitation of the elements of a
cause of action will not do.’”) (citing Twombly, 550 U.S. at 555); Watters v. Harsco Metals,
No. 2:14-CV-00483, 2014 WL 3401456, at *11 (N.D. Ala. Jul. 11, 2014) (denying a claim

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for outrage as too vague when it was based upon assertions of “a ‘harsh and unreasonable’
performance standard, humiliation, embarrassment, and harsher discipline practices …
[causing] ‘extreme emotional distress by conduct which was unreasonable, unwarranted
and outrageous’”); Little, 72 So. 3d at 1173 (“nothing in the record indicates the nature,
extent, context or egregiousness of [the] alleged racial comments”). Similarly, plaintiffs’
allegation of emotional distress consists only of a conclusory statement that defendant’s
conduct “reasonably resulted in their mental anguish.” (Doc. 15 at 2). This type of
conclusory allegation is insufficient to make the required showing of improper motive or
intent to cause severe emotional distress, or to allege facts necessary to establish distress
that was “so severe that no reasonable person could be expected to endure it. See State
Farm, supra, 612 So. 2d at 443; Carter v. Countrywide Home Loans Inc., No. 3:10CV503,
2010 WL 4269149, at *8 (M.D. Ala. 2010) (deciding that plaintiffs could not “state a claim
for outrageous conduct simply by making conclusory allegations” that they had suffered
“emotional pain and suffering, [and] depression”).
Nothing in plaintiffs’ amended complaint details the type of behavior plaintiffs were
subjected to beyond delays in payment of the insurance claim. Delay or refusal to pay on
an insurance claim is not sufficient by itself to demonstrate barbaric conduct. See Soti v.
Lowe’s Home Centers, Inc., 906 So. 2d 916 (Ala. 2005) (noting that a “failure to authorize
a referral alone does not amount to conduct so outrageous in character and so extreme in
degree as to go beyond all possible decency, and to be regarded as atrocious and utterly
intolerable in a civilized society”) (citing ITT Specialty Risk Servs. v. Barr, 842 So. 2d 638,
645 (Ala. 2002) (internal quotation marks omitted)); Gibson v. So. Guaranty Ins. Co., 623

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So. 2d 1065, 1067 (Ala. 1993) (finding that ordinary delays, misunderstandings, and
breakdowns in communication are not sufficient to demonstrate outrageous conduct).
CONCLUSION
For the foregoing reasons, it is ORDERED that defendant’s motion to dismiss (Doc.
19) as to count II is GRANTED, and plaintiffs’ claim for emotional distress is DISMISSED
with prejudice. It is further
ORDERED that plaintiffs’ stipulation to the dismissal of counts IV (negligence), V
(recklessness and wantonness), and VI (gross negligence) (Doc. 10), which the court
construes as a motion to amend the complaint to remove those claims, is hereby GRANTED
pursuant to Fed. R. Civ. R. 15(a)(2). This case will proceed henceforth only on plaintiffs’
breach of contract (count I) and bad faith (count III) claims. (Doc. 1).
DONE, on this the 16th day of May, 2017.
/s/ Susan Russ Walker
Susan Russ Walker
Chief United States Magistrate Judge

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