Whitney v. Esurance Insurance Company et al
Filing
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ORDER granting 9 Defendants' Motion to Dismiss for Fraudulent Joinder; denying as moot 10 Plaintiff's Motion to Remand. Signed by Judge James I. Cohn on 8/7/2013. (npd)
IUNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO.: 13-61329-CIV-COHN/SELTZER
WENDY WHITNEY, a Florida resident,
Plaintiff,
vs.
ESURANCE INSURANCE COMPANY, a foreign
corporation and LISA REYNOLDS, a Florida
resident,
Defendants.
_______________________________________/
ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS FOR FRAUDULENT
JOINDER AND DENYING AS MOOT PLAINTIFF’S MOTION TO REMAND
THIS CAUSE is before the Court upon Defendants, Esurance Insurance
Company and Lisa Reynolds’, Motion to Dismiss for Fraudulent Joinder [DE 9]
(“Motion”). The Court has carefully considered the Motion, Plaintiff’s Response [DE 11]
(“Response”), Defendants’ Reply [DE 18] (“Reply”), the record in the case, and is
otherwise fully advised in the premises.
I. BACKGROUND
Plaintiff Wendy Whitney (“Plaintiff”) filed this action against Defendants Esurance
Insurance Company (“Esurance”) and Lisa Reynolds (“Reynolds”) (collectively
“Defendants”) on April 25, 2013, in the Circuit Court of the Seventeenth Judicial Circuit
in and for Broward County. Defendant Esurance removed the case to this Court on
June 14, 2013. Notice of Removal [DE 1]. According to the Complaint, Plaintiff had an
automobile liability insurance policy with Esurance containing bodily injury policy limits
of $250,000 per person/$500,000 per accident. Compl. [DE 1-1] ¶ 5. On December
31, 2008, Plaintiff was in an accident with Manos Milien wherein he sustained “serious,
catastrophic personal injuries and paralysis.” Id. ¶ 6. Plaintiff contends that Esurance
“failed to timely tender [her] available coverage to Manos Milien.” Id. ¶ 13. Reynolds
“negligently misrepresented” to Plaintiff that she would timely tender the $250,000
policy limits to Manos Milien, but failed to do so. Id. ¶ 14. As a result, Manos Milien
filed suit against Plaintiff and obtained a judgment of $31,445,000.00 against her. Id.
¶¶ 15-16. A judgment of $212,375.98 in costs was also entered against Plaintiff. Id. ¶
18. Plaintiff contends that Esurance breached its good faith duties to her. Id. ¶¶ 23-26.
Additionally, Plaintiff alleges that Reynolds, the claims adjuster, made negligent
misrepresentations to her regarding the investigation, handling, and settlement of
Manos Milien’s claim. Id. ¶¶27-33. Defendants have moved to dismiss the Complaint
as to Reynolds on the grounds that Reynolds was fraudulently joined in this matter.
Plaintiff opposes the Motion.
II. DISCUSSION
“To establish fraudulent joinder, ‘the removing party has the burden of proving
[by clear and convincing evidence] that either: (1) there is no possibility the plaintiff can
establish a cause of action against the resident defendant; or (2) the plaintiff has
fraudulently pled jurisdictional facts to bring the resident defendant into state court.’”
Stillwell v. Allstate Ins. Co., 663 F.3d 1329, 1332 (11th Cir. 2011) (quoting Crowe v.
Coleman, 113 F.3d 1536, 1538 (11th Cir. 1997)). This burden is a “heavy one.” Id.
(internal quotation marks omitted). To defeat a fraudulent joinder claim, the complaint
need only present “a possibility of stating a valid cause of action.” Id. at 1333 (quoting
Triggs v. John Crump Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir.1998)). “[T]he district
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court must evaluate factual allegations in the light most favorable to the plaintiff and
resolve any uncertainties about the applicable law in the plaintiff's favor.” Pacheco de
Perez v. AT&T Co., 139 F.3d 1368, 1380 (11th Cir. 1998). If the court finds that the
non-diverse defendant was fraudulently joined, “the federal court must dismiss the
non-diverse defendant and deny any motion to remand the matter back to state court.”
Florence v. Crescent Res., LLC, 484 F.3d 1293, 1297 (11th Cir. 2007) (citations
omitted).
Here, Defendants allege that Reynolds was fraudulently joined to this action to
defeat this Court’s diversity jurisdiction. Motion at 2. Specifically, Defendants contend
that Reynolds’ joinder was fraudulent because “there is no possibility that the [sic] she
can establish a viable cause of action as to Defendant Reynolds.” Id. at 5. In support
of this argument, Defendants contend that Plaintiff cannot assert a bad faith claim
against Reynolds because “Florida’s bad faith law sets forth a duty that is owed by an
insurer to its insured, not a duty that is owed by an insurance adjuster to the insured.”
Id. at 7. Defendants further argue that Florida law does not recognize a cause of action
for negligent misrepresentation against insurance adjusters. Id. at 12-13. In
opposition, Plaintiff states that she is not asserting a bad faith claim against Reynolds.
Response at 4.1 Instead, Plaintiff contends that “she has sufficiently plead with factual
allegations the elements of a cause of action for negligent misrepresentation against
REYNOLDS.” Id. For the reasons discussed below, the Court agrees with Defendants
that Plaintiff cannot establish a claim for negligent misrepresentation against Reynolds.
1
Accordingly, the Court will not address whether Plaintiff may state a bad
faith claim against Reynolds.
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The Complaint is clear that it brings a negligent misrepresentation claim against
Reynolds. See, e.g., Compl. ¶¶ 27, 28, 31, 35. “Florida law does not recognize a
cause of action by an insured against an independent insurance adjuster in simple
negligence.” King v. Nat’l Sec. Fire & Cas. Co., 656 So.2d 1338, 1339 (Fla. Dist. Ct.
App. 1995). As explained by the Fourth District Court of Appeal, an insurance adjuster
“does not owe a duty to the insured unless the insured is suing for an intentional tort.”
Id. Applying King, this Court has previously found that an insured cannot state a valid
claim for negligence against insurance adjusters assigned to its claim. Fontainebleau
Gardens Condo. Ass'n, Inc. v. Pac. Ins. Co., Ltd., 768 F. Supp. 2d 1271, 1275 (S.D.
Fla. 2011); see also Kuhlman v. Crawford & Co., No. 01-6036-CIV, 2002 WL
34368089, at *3 (S.D. Fla. Jan. 23, 2002) (“[T]his Court concludes that none of these
common law torts based upon a breach of duty are available in Florida against an
insurance adjustor.”).
Plaintiff criticizes this Court’s holdings in Fontainebleau Gardens Condo. Ass'n,
Inc. v. Pac. Ins. Co., Ltd. and Kuhlman v. Crawford & Co., by arguing that these cases
misapplied King. Response at 7. Plaintiff argues King’s holding was limited solely to
independent adjusters, not employee adjusters like Reynolds. Id. The Court is not
persuaded. If the Court were to accept Plaintiff’s interpretation of King, Florida law
would permit greater liability against employee adjusters than independent adjusters.
As Defendants point out, however, this is an absurd result. See Reply at 6. There is no
basis for the Court to conclude that Florida law treats independent and employee
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adjusters differently, especially when neither are in privity of contract with the insured.2
Finally, the Court rejects Plaintiff’s reliance on case law discussing general
agency principals to support that she may assert a negligent misrepresentation claim
against Reynolds. See Response at 5-6. Florida has developed a specific body of
insurance law. As discussed above, Florida case law has rejected negligence claims
against insurance adjusters in precisely these circumstances. Accordingly, because
Plaintiff cannot establish a claim against Reynolds, the Court finds that she was
fraudulently joined in this matter, will grant the Motion and dismiss all claims against
Reynolds, and deny Plaintiff’s motion to remand as moot. See Dumas v. ACCC Ins.
Co., 349 F. App’ x 489, 492 (11th Cir. 2009) (affirming district court dismissal of
insurance adjuster defendant and denial of motion to remand where under Georgia law,
insurance adjuster did not owe insured an independent duty to act in good faith).
III. CONCLUSION
Based on the foregoing, it is ORDERED AND ADJUDGED as follows:
1.
Defendants, Esurance Insurance Company and Lisa Reynolds’, Motion to
Dismiss for Fraudulent Joinder [DE 9] is GRANTED;
2
Plaintiff appears to assert that because Reynolds was Esurance’s
employee, she was in privity with Plaintiff. See Response at 8. The Court disagrees.
“Under Florida law, ‘a person making or purporting to make a contract with another as
agent for a disclosed principal does not become a party to the contract.’” Stallworth v.
Hartford Ins. Co., No. 3:06cv89/MCR/EMT, 2006 WL 2711597, at *7 (N.D. Fla. Sept.
19, 2006) (quoting Philip Schwartz, Inc. v. Gold Coast Graphics, Inc., 623 So. 2d 819,
820 (Fla. Dist. Ct. App. 1993)). Here, there are no allegations in the Complaint which
support that Reynolds was a party to the insurance contract or even participated in the
drafting of Plaintiff’s insurance contract. Thus, there is zero basis for Plaintiff to assert
that she was in privity with Reynolds.
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2.
Plaintiff’s claims against Defendant Lisa Reynolds are hereby DISMISSED WITH
PREJUDICE for fraudulent joinder; and
3.
Plaintiff’s Motion to Remand [DE 10] is DENIED as MOOT.
DONE AND ORDERED in Chambers at Fort Lauderdale, Broward County,
Florida, this 7th day of August, 2013.
Copies provided to counsel of record via CM/ECF.
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