Arvon v. Liberty Mutual Fire Insurance Company

Filing 85

MEMORANDUM OPINION. Signed by Magistrate Judge Beth P. Gesner on 3/1/2019. (bmhs, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
*
BIEJAN ARVON,
*
Plaintiff,
*
v.

Civil No.: BPG-17-2022
*

LIBERTY MUTUAL FIRE INSURANCE CO.,
*
Defendant/Third-Party Plaintiff,
*
v.
*
MARC SELDIN ROSEN, ESQ. and
THE LAW OFFICES OF MARC
SELDIN ROSEN, LLC,

*
*

Third-Party Defendants.
*
*

*

*

*

*

*
*
*
*
MEMORANDUM OPINION

*

*

*

*

*

Currently pending before the court are third-party defendants Marc Seldin Rosen, Esq., and
the Law Offices of Marc Seldin Rosen’s (“Rosen”) Motion to Dismiss Third-Party Complaint
(“Motion to Dismiss”) (ECF No. 70), Liberty Mutual Fire Insurance Company’s (“Liberty” or
“defendant’s”) Opposition to Motion to Dismiss the Third-Party Complaint (“Opposition”) (ECF
No. 71), and Rosen’s Reply in Support of Rosen’s Motion to Dismiss Third-Party Complaint
(“Reply”) (ECF No. 74). The issues are fully briefed, and no hearing is necessary. Loc. R. 105.6.
For the reasons stated below, Rosen’s Motion to Dismiss (ECF No. 70) is granted in part and
denied in part.

1

I.

BACKGROUND
This case arises out of a car accident that occurred on July 8, 2011 between plaintiff and

two individuals, Alireza Gol (“Gol”) and Hamed Khodaparasti Dehboneh (“Khodaparasti”). (ECF
No. 2 at 3). Plaintiff was taken from the scene by medical professionals without exchanging
information with the other individuals. (ECF No. 2 at 2). After the accident, plaintiff was
contacted by defendant, ostensibly on behalf of one of its insureds, Puya Shakiba (“Shakiba”),
who, unbeknownst to plaintiff, was not involved in the accident. Id. Plaintiff alleged that he “was
led to believe through many written communications by [defendant] that Mr. Shakiba was the
insured party at fault.” Id. Plaintiff further alleged that defendant paid for plaintiff’s property
damage claims under Shakiba’s name, requested plaintiff’s medical records on Shakiba’s behalf,
“repeatedly identified Mr. Shakiba as the responsible insured,” and “repeatedly offer[ed] to
negotiate a settlement on behalf of Mr. Shakiba” without ever mentioning Gol or Khodaparasti.
(ECF No. 2 at 2–3). Plaintiff also alleged that his counsel, Marc Rosen, attempted to negotiate a
settlement with defendant, but defendant’s misrepresentations continued in its conversations with
Rosen, and defendant “delayed in responding to Rosen’s demands in order to allow the limitations
period to pass.” (ECF No. 70-1 at 3).
Plaintiff filed suit against Shakiba in the Baltimore County Circuit Court before the
expiration of the statute of limitations. Id. After the statute of limitations expired, however,
defendant allegedly “disclosed for the first time that the wrong person had been named in their
previous communications and in [plaintiff’s] Complaint.” Id. Defendant identified the driver of
the vehicle as Gol, and the owner and passenger of the vehicle as Khodaparasti. Id. Shakiba, the
roommate of Gol and Khodaparasti, was not involved in the accident. (ECF No. 2 at 2). Plaintiff
filed an amended complaint adding Gol and Khodaparasti as defendants, but all defendants were

2

granted summary judgment. (ECF No. 70-1 at 3). Plaintiff appealed to the Maryland Court of
Special Appeals, arguing that his amended complaint related back to his original complaint, and
that he was misled by false representations made by Liberty, in an effort to delay him from
correcting the named defendants until after the limitations period passed. (ECF No. 24 at 5–8).
The Court of Special Appeals affirmed the Circuit Court’s decision and held that summary
judgment was proper as to Shakiba because he was not involved in the accident and therefore
breached no duty he owed the plaintiff. (ECF No. 10-3 at 6). The court also held that summary
judgment was proper as to Gol and Khodaparasti based on the expiration of the statute of
limitations. (ECF No. 10-3 at 7). Applying the doctrine of equitable tolling, the court held that
plaintiff’s limitations period was not tolled because the plaintiff failed to exercise reasonable care
and due diligence by not obtaining the police report from the accident, which identified Gol and
Khodaparasti as the responsible parties. (ECF No. 10-3 at 9–10). Regardless of whether Liberty’s
conduct was intentional or mistaken, the court noted that plaintiff had access to the necessary
information and Liberty was under no duty to tell plaintiff who to sue. Id.
Plaintiff then filed the present lawsuit against defendant alleging both negligent and
intentional misrepresentation. (ECF No. 2 at 8–10). Defendant sought leave to file a third-party
complaint against plaintiff’s former attorney, Rosen, alleging that any injury suffered by the
plaintiff was due to the negligent acts and/or omissions of Rosen, as plaintiff’s attorney, in failing
to obtain the police report from the underlying accident which would have identified the driver of
the other vehicle. (ECF No. 40-1 at 1–6). This request was granted (ECF No. 50), and defendant
filed a third-party complaint against Marc Seldin Rosen, Esq., and the Law Offices of Marc Seldin
Rosen (“Rosen”) (ECF No. 51).

This third-party complaint contains two counts seeking

3

indemnification and contribution from Rosen in the event that defendant is held liable. Id. at 6–7.
Rosen then filed the instant motion to dismiss. (ECF No. 70).
II.

STANDARD OF REVIEW
The purpose of a motion to dismiss for failure to state a claim under Federal Rule of Civil

Procedure 12(b)(6) is to test the legal sufficiency of a complaint. Edwards v. City of Goldsboro,
178 F.3d 231, 243 (4th Cir. 1999). When ruling on such a motion, the court must “accept[] all
well-pleaded allegations in the plaintiff’s complaint as true” and “draw[] all reasonable factual
inferences from those facts in the plaintiff’s favor.”1 Id. at 244. Nonetheless, “[t]he mere recital
of elements of a cause of action, supported only by conclusory statements, is not sufficient to
survive a motion made pursuant to Rule 12(b)(6).” Walters v. McMahen, 684 F.3d 435, 439 (4th
Cir. 2012) (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). Rather, “a complaint must contain
sufficient factual matter . . . to state a claim to relief that is plausible on its face.” Ashcroft, 556
U.S. at 678 (internal citation and quotation marks omitted). A plaintiff satisfies this standard not
by forecasting evidence sufficient to prove the elements of the claim, but by alleging sufficient
facts to establish those elements. Walters, 684 F.3d at 439. Accordingly, “while a plaintiff does
not need to demonstrate in a complaint that the right to relief is ‘probable,’ the complaint must
advance the plaintiff’s claim ‘across the line from conceivable to plausible.’” Id. (citing Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
III.

DISCUSSION
A.

Count I—Indemnification

The parties agree that “[a] party may be entitled to receive indemnification where his own
conduct, although negligent, is considered to be passive or secondary.” Pyramid Condo. Ass’n v.

Here, “plaintiff” refers to defendant, as defendant has filed a third-party complaint against Rosen as a third-party
plaintiff. (ECF No. 51).
1

4

Morgan, 606 F. Supp. 592, 596 (D. Md. 1985). “The determination of whether a tortfeasor's
negligence is active or passive must be made by referring to the plaintiff's complaint against the
defendant seeking to implead the third party.” Id. (citing Tesch v. United States, 546 F. Supp. 526,
529 (E.D. Pa. 1982)). “If the plaintiff's complaint alleges conduct by the third-party plaintiff that
would constitute active negligence, or if it is clear from the circumstances revealed by the
plaintiff's complaint that the defendant's (third-party plaintiff) liability would only arise, if at all,
from proof of active negligence, there is no basis for an indemnity claim and dismissal of the claim
is appropriate.” Id. (citations omitted).
Rosen argues that defendant’s claim for indemnification fails because indemnification is
only available for passive negligence and plaintiff’s claims against defendant allege active
negligence. (ECF No. 70-1 at 4). Specifically, Rosen argues that plaintiff alleges “a series of
active steps by [defendant] to wrongfully identify Puya Shakiba as the driver of the vehicle,
including: communicating with [plaintiff] on his behalf, requesting medical records, settling a
property damage claim on behalf of Shakiba, and repeatedly identifying Shakiba as the only party
of interest to the dispute.” (ECF No. 70-1 at 6 (citing ECF No. 2 at ¶¶ 5–16)). Defendant argues
that it is entitled to indemnification because plaintiff alleged facts as to defendant’s conduct that
could be considered passive, specifically, that defendant failed to correct misstatements made by
Rosen regarding Shakiba’s participation in the accident. (ECF No. 71 at 11). Defendant further
argues that Rosen’s actions and his related duties to his client “differ substantially to those of
[defendant], and should be considered active negligence.” Id. at 12.
Here, it is clear from the complaint that plaintiff alleges conduct by the third-party plaintiff
that would constitute active negligence. This court addressed a similar situation in Renick et al.
v. Sperau et al., Civil No. CCB-12-1627, 2013 WL 1314417 (D. Md. Mar. 29, 2013). There, the

5

plaintiffs bought a house that contained lead paint hazards from the defendants and sued the
defendants for violations of the Residential Lead-Based Paint Hazard Reduction Act
(“RLPHRA”), intentional misrepresentation, and negligent misrepresentation, based on
defendants’ initialing of affirmative statements “and thereby affirmatively representing that no
lead paint hazards existed in the house.” Id. at *6. The defendants then filed a third-party
complaint, seeking indemnity from their realtor and its agent as third-party defendants. Id. at *1.
The court granted the third-party defendants’ motion to dismiss, finding that, for the plaintiffs to
succeed on any of their counts, the defendants “must be found to have committed active
negligence,” and “a reasonable jury could not determine that [defendants] were only passively
negligent and grant indemnity” to defendants on that basis. Id. Similarly, here, plaintiff alleges
that defendant made “many misrepresentations of fact pertaining to the identity of its insured
driver, including its settlement of the property damage claim in the name of someone other than
the driver at fault.” (ECF No. 2 at ¶ 27). Accordingly, as in Renick, plaintiff alleges that defendant
committed active negligence, rather than passive negligence.
Defendant’s additional arguments that indemnification is proper are without merit. While
plaintiff has “alleged that [defendant] failed to correct misstatements made by [Rosen] regarding
Mr. Shakiba’s participation in the accident,” as noted by defendant (ECF No. 71 at 11), this
occurred after defendant allegedly made affirmative misrepresentations of fact. Accordingly, for
the trier of fact to determine that defendant was passively negligent by failing to correct these
misstatements, it would have to first find that defendant was actively negligent by making the
misstatements, which would preclude defendant from receiving indemnity from Rosen. Defendant
also argues that Rosen’s actions should be considered active negligence because “Mr. Rosen’s
actions and the related duties Mr. Rosen held towards his client differ substantially to those of

6

Liberty.” (ECF No. 71 at 12). This argument fails, however, because plaintiff alleges that
defendant’s negligence was active, rather than passive, so defendant is not entitled to
indemnification regardless of the active/passive nature of Rosen’s alleged negligence.
Accordingly, Count I of the third-party complaint fails as a matter of law and is dismissed.
B.

Count II—Contribution

As noted by the parties, the Maryland Uniform Contribution Among Joint Tort-Feasors
Act (“UCATA”), Md. Code. Ann., Cts. & Jud. Proc. §§ 3-1401 et seq., provides for contribution
among joint tort-feasors. Md. Code. Ann., Cts. & Jud. Proc. § 3-1402(a). “Joint tort-feasors are
‘two or more persons jointly or severally liable in tort for the same injury to person or property,
whether or not judgment has been recovered against all or some of them.’” Renick et al., 2013
WL 1314417 at *6 (quoting Md. Code. Ann., Cts. & Jud. Proc. § 3-1401(c)). The right to
contribution applies “when joint tort-feasors are held liable and one tort-feasor has paid more than
her pro rata share of the damages.” Id. (citing Lerman v. Heeman, 701 A.2d 426, 445–46 (Md.
1997)). This right applies even though “the liability of each wrongdoer may rest on a different
ground.” Id. (citing Fischbach & Moore Int’l Corp. v. Crane Barge R-14, 476 F. Supp. 282, 287
(D. Md. 1979)).
Here, defendant has alleged in its third-party complaint (ECF No. 51) that, if defendant is
found liable to plaintiff, then Rosen is liable to defendant “for contributions in that the claimed
damages were caused by the actions and inactions of [Rosen] under [the UCATA].” (ECF No. 51
at 8). Defendant specifically alleges that Rosen “failed to make appropriate, reasonable, and
specific inquiries as to the identity of the driver of the motor vehicle involved in the [a]ccident and
the identity of the owner of said motor vehicle.” (ECF No. 51 at 5). Defendant further alleges that
Rosen failed to “name as defendants the driver of the motor vehicle involved in the [a]ccident or

7

the owner of said motor vehicle,” and that said failure “caused and/or contributed to the injuries
that [plaintiff] is seeking in this case.” (ECF No. 51 at 5–6).
Rosen argues that defendant’s contribution claim “fails as a matter of law because
[plaintiff] cannot succeed against [defendant] without also defeating the allegations against
Rosen.” (ECF No. 70-1 at 7). Specifically, Rosen argues that plaintiff must “demonstrate that he
and Rosen reasonably or justifiably relied on [defendant’s] misrepresentations” to prevail on his
claims against defendant for negligent and intentional misrepresentations. Id. at 8. On the other
hand, Rosen argues, for defendant to succeed on its claim against Rosen for contribution, defendant
must demonstrate that Rosen did not act reasonably or justifiably. Id. Thus, Rosen argues, “it is
impossible for both [defendant] and Rosen to be liable for the same injury to [plaintiff].” Id. at 9.
Defendant argues that its claim is proper because a fact-finder could find that plaintiff was misled
by defendant, but that Rosen was “liable over to [defendant] for successful claims related to the
same damages.” (ECF No. 71 at 16). Defendant further argues that there may be a potential
scenario where both defendant and Rosen are liable to plaintiff, noting that plaintiff “appears to
contend that [defendant] misrepresented the identity of the driver to him prior to the time he was
represented by Mr. Rosen.” Id. at 17. Defendant also urges the court to reject Rosen’s argument
at this time, given that the court “does not presently have the benefit of knowing the nature and
timing of putative misrepresentations, the specific acts undertaken in reliance, and what Mr. Rosen
did or did not do to fulfill his own duties to his client.” Id.
Here, defendant’s third-party complaint offers sufficient facts to state a claim to relief that
is plausible on its face, specifically, that Rosen is also liable to plaintiff for failing to properly
identify the driver. Further, as noted by defendant, it is not impossible for both defendant and
Rosen to be liable for the same injury to plaintiff. In plaintiff’s complaint, plaintiff states that he

8

retained counsel after defendant misinformed him regarding the identity of the driver and that,
thereafter, Rosen received similar misinformation and relied on the same. (ECF No. 2 at 4). A
trier of fact could find that defendant misrepresented the identity of the driver to plaintiff before
plaintiff retained counsel and that plaintiff reasonably relied on that misrepresentation, but that,
after he was retained, Rosen negligently failed to independently identify the driver and thus
contributed to plaintiff’s injuries. Therefore, defendant’s contribution claim “state[s] a claim to
relief that is plausible on its face.” Ashcroft, 556 U.S. at 678.
Defendant’s claim for contribution fails as a matter of law, however, to the extent that it
seeks contribution for intentional acts. As noted by Rosen, the UCATA only allows contribution
“between negligent tortfeasors.” (ECF No. 70-1 at 10 (quoting Parler & Wobber v. Miles &
Stockbridge, 756 A.2d 526, 534 (Md. 2000)). Accordingly, defendant may seek contribution from
Rosen in the event that defendant is found liable on plaintiff’s claim of negligent
misrepresentation. If, on the other hand, defendant is found liable on plaintiff’s claim of intentional
misrepresentation, defendant may not seek contribution from Rosen. To be found liable on the
claim of intentional misrepresentation, the trier of fact must find that defendant “made a false
misrepresentation to the plaintiff” and “the misrepresentation was made for the purpose of
defrauding the plaintiff.” Kilcos Painting Co., Inc. v. Saffo Contractors, Inc., No. RDB-15-2505,
2018 WL 3432043 at *13 (D. Md. July 16, 2018) (quoting On Site Pers., LLC v. C-Care, LLC, et
al., No. JFM-13-03700, 2015 WL 2129685 at *13 (D. Md. May 6, 2015)). Accordingly, if
defendant is found liable for intentional misrepresentation, defendant would not be a “negligent
tortfeasor.”

9

Based on the foregoing, if defendant is found liable solely on plaintiff’s claim of negligent
misrepresentation, defendant may be able to claim a right of contribution from Rosen. Rosen’s
motion to dismiss is denied as to defendant’s contribution claim.
IV.

CONCLUSION
For the foregoing reasons, Rosen’s Motion to Dismiss (ECF No. 70) is GRANTED in part

and DENIED in part. A separate order will be issued.

March 1, 2019

/s/
Beth P. Gesner
Chief United States Magistrate Judge

10