Weinbach v. Starwood Hotels and Resorts Worldwide, Inc.

Filing 46

MEMORANDUM AND ORDER IT IS HEREBY ORDERED that Defendant Starwood Hotels and Resorts Worldwide, Inc.s Motion for Judgment on the Pleadings as to Plaintiffs Negligence per se Claim in Plaintiffs Petition (ECF 25) is GRANTED; andIT IS FURTHER ORDERED that Count I of Plaintiffs Complaint is DISMISSED. 25 Signed by District Judge Jean C. Hamilton on 8/23/17. (CLA)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION

LANA WEINBACH,

Plaintiff,
vs.
STARWOOD HOTELS AND RESORTS
WORLDWIDE, INC.,
Defendant.

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Case No. 4:16CV783JCH

MEMORANDUM AND ORDER
This matter is before the court pursuant to Defendant Starwood Resorts Worldwide,
Inc.’s Motion for Judgment on the Pleadings as to Plaintiff’s Negligence per se Claim in
Plaintiff’s Petition (Motion for Judgment on the Pleadings). (ECF 25). The matter is fully
briefed and ready for disposition.
BACKGROUND
Defendant Starwood Hotels and Resorts Worldwide, Inc., (Starwood) removed this
matter from the Circuit Court of the County of St. Louis, Missouri, pursuant to 28 U.S.C. §§
1332, 1441, and 1446.
As relevant to the pending Motion, the allegations of Plaintiff Lana Weinbach’s
Complaint are as follows. Plaintiff is the daughter of Ben and Sarah Weinbach. Sarah Weinbach
died in 1977, and Ben Weinbach died in 2009. Plaintiff lived at 8720 West Kingsbury Avenue,
St. Louis, Missouri, with both of her parents prior to their deaths, and continued to live there
through the date the Complaint was filed.

During their lives, Ben and Sarah Weinbach

purchased shares of stock in ITT Corporation, which, after a merger, became shares of stock in

Starwood (the Starwood Shares). Ben and Sarah Weinbach purchased the Starwood Shares
jointly with Plaintiff. Upon her father’s death, Plaintiff became the sole owner of the Starwood
Shares. (ECF 1.1, ¶¶ 9-14).
Specifically, Plaintiff alleges that, in 2003, Starwood reported the Starwood Shares as
abandoned to the State Treasurer (the Treasurer), and that, prior to doing so, Starwood
“unquestionably knew the whereabouts of” Plaintiff and Ben Weinbach, and failed to “send any
communication of any type” to Plaintiff and Ben Weinbach regarding the Starwood Shares it
deemed abandoned. Plaintiff also alleges that as a result of a 2006 transaction between Starwood
and Host Hotels & Resorts, Inc., (Host), Plaintiff and Mr. Weinbach received shares in Host (the
Host Shares); that, at the time the transaction between Starwood and Host took place, Plaintiff’s
and Mr. Weinbach’s Starwood Shares were in the possession of the Treasurer; and that,
therefore, the Host Shares belonging to Plaintiff and Mr. Weinbach were delivered to the
Treasurer. Plaintiff also alleges that, in 2009, the Treasurer sold the Starwood Shares and the
Host Shares, and that neither Starwood nor the Treasurer published or mailed to Plaintiff or Ben
Weinbach notice prior to the Treasurer’s doing so. (ECF 1.1, ¶¶ 15-42).
Plaintiff alleges that Starwood’s conduct did not comply with the Missouri Uniform
Disposition of Unclaimed Property Act (MDUPA), Mo. Rev. Stat. §§ 447.500-447.595, because
“it did not make proper efforts to locate Ben Weinbach and [Plaintiff] and did not provide them
proper notice that it deemed their Starwood Shares to be abandoned and transferred to the
Treasurer.” Plaintiff alleges that because Starwood did not comply with the MDUPA’s notice
requirements, it is not entitled to be relieved from liability under MDUPA § 447.545.1.1 Finally,

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The Missouri Uniform Disposition of Unclaimed Property Act (MDUPA) § 447.545.1
provides: “Upon the payment or delivery of abandoned property, the state shall assume custody
and shall be responsible for the safekeeping thereof. Any person who pays or delivers
2

Plaintiff alleges that Starwood did not comply with the delivery requirement of MDUPA §
447.545.4,2 and is, therefore, not entitled to be relieved of liability under that statutory provision.
(ECF 1.1, ¶¶ 45-47).
In Count I, Negligence Per Se, Plaintiff alleges that Starwood had obligations under
MDUPA § 447.539.5,3 MDUPA § 447.503(11) (“reasonable and necessary diligence” is
consistent with “good business practice”; holders shall send notice regarding unclaimed property
first class mail, postage prepaid, and marked “Address Correction Requested”), and the Missouri
Code of State Regulations, 15 C.S.R. 50-3.070(3)(C) (requiring “[h]olders to exercise reasonable
and necessary diligence as is consistent with good business practice in attempting to locate
owners of abandoned property”), and that Starwood violated those obligations by “improperly
presuming the Starwood Shares were abandoned, and transferring them to the Treasurer, and by
abandoned property pursuant to sections 447.500 to 447.595 is relieved of all liability for any
claim which then exists or which thereafter may arise or be made in respect to the property.”
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As relevant, MDUPA § 447.545.4 provides:
The holder of any interest pursuant to section 447.520 evidenced only by the
stock records or membership records of the business association may deliver a
duplicate certificate to the treasurer. Upon such delivery, the holder . . . shall be
relieved from all liability of every kind to the person acquiring the original
certificate or the duplicate of such certificate issued to the treasurer, not to exceed
the liquidated value of the property on the date of delivery, or if unliquidated, the
market value of the property on the date of delivery.

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As relevant, MDUPA § 447.539.5 provides:
If the holder of property presumed abandoned pursuant to sections 447.500 to
447.595 knows the whereabouts of the owner, if the owner's claim has not been
barred by the statute of limitations, and the property involved is valued at fifty
dollars or more, the holder shall, before filing the annual report, communicate
with the owner and take necessary steps to prevent abandonment from being
presumed. The holder shall exercise such reasonable and necessary diligence as
is consistent with good business practice to ascertain the whereabouts of such
owner of property valued at fifty dollars or more within one year prior to
reporting the property to the state treasurer.
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its failure to communicate with Ben Weinbach and [Plaintiff] regarding the Shares and their
alleged abandonment.” Plaintiff further alleges that as a result of Starwood’s conduct she
“would still possess [the] Starwood Shares and the Host Shares or would have been in a position
to sell them at some previous time.” (ECF 1.1, ¶¶ 48-57). In Count II, Plaintiff alleges
Conversion. Only Count I is the subject of Defendant’s Motion for Judgment on the Pleadings.
JUDGMENT ON THE PLEADINGS STANDARD
The standard applicable to a motion for judgment on the pleadings is the same standard
used to address a motion to dismiss for failure to state a claim under Rule 12(b)(6) of the Federal
Rules of Civil Procedure. Ashley Cnty v. Pfizer, Inc., 552 F.3d 659, 665 (8th Cir. 2009) (citing
Westcott v. City of Omaha, 901 F.2d 1486, 1488 (8th Cir. 1990)). Rule 12(b)(6) “requires the
court to ‘accept as true all factual allegations set out in the complaint’ and to ‘construe the
complaint in the light most favorable to the plaintiff[], drawing all inferences in [the plaintiff’s]
favor.’” Ashley County, 552 F.3d at 665 (quoting Wishnatsky v. Rovner, 433 F.3d 608, 610 (8th
Cir. 2006)). “‘[W]ell-pleaded facts, not legal theories or conclusions, determine [the] adequacy
of [t]he complaint.’” Clemons v. Crawford, 585 F.3d. 1119, 1124 (8th Cir. 2009) (quoting Mattes
v. ABC Plastics, Inc., 323 F.3d 695, 698 (8th Cir. 2003) (internal citation omitted). “The facts
alleged in the complaint ‘must be enough to raise a right to relief above the speculative level.’”
Clemons, 585 F.3d. at 1124 (quoting Drobnak v. Andersen Corp., 561 F.3d 778, 783 (8th Cir.
2009) (internal citation omitted).
In a diversity case, such as the matter under consideration, a court must interpret the
applicable state law “‘in determining whether the elements of the [alleged] offenses have been
pled.’”

Ashley County, 552 F.3d at 665 (quoting Moses.com Sec., Inc. v. Comprehensive

Software Sys., Inc., 406 F.3d 1052, 1062 (8th Cir. 2005)).

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LEGAL FRAMEWORK FOR NEGLIGENCE PER SE
While “negligence in a particular situation depends on whether or not a reasonably
prudent person would have anticipated danger and provided against it,” “[n]egligence per se
arises where the legislature pronounces in a statute what the conduct of a reasonable person must
be, whether or not the common law would require similar conduct.” Lowdermilk v. Vescovo
Bldg. and Realty Co., Inc., 91 S.W.3d 617, 628 (Mo. Ct. App. 2002) (internal citations and
quotation marks omitted). When the legislature has done so, “the court [] adopts the statutory
standard of care to define the standard of conduct of the reasonable person.” Lowdermilk, 91
S.W.3d at 628 (citing Restatement Torts (Second) §§ 286, 288 (1965)). “Negligence per se ‘is a
form of ordinary negligence that results from the violation of a statute.’” Lowdermilk, 91
S.W.3d at 628 (quoting 57A Am. Jur. 2d Negligence § 727 (1989)). Where negligence per se is
applicable, “the jury is instructed on the statutory standard of care rather than the care of the
reasonable person.” Lowdermilk, 91 S.W.3d at 628 (citing Egenreither v. Carter, 23 S.W.3d
641, 643-45 (Mo. Ct. App. 2000)).
The four requirements necessary to establish a claim for negligence per se are:
1) a violation of a statute or ordinance; 2) the injured party must be within the
class of persons intended to be protected by the statute or ordinance; 3) the injury
complained of must be of the nature that the statute or ordinance was designed to
prevent; and 4) the violation of the statute or ordinance must be the proximate
cause of the injury.
Lowdermilk, 91 S.W.3d at 628 (quoting Bus. Men's Assur. Co. v. Graham, 891 S.W.2d 438, 455
(Mo. Ct. App. 1994)).
Prior to determining whether there is a violation of a statute, a court must first determine
whether the statute at issue is one “on which negligence per se may be premised.” Lowdermilk,
91 S.W.3d at 628. Negligence per se “is ordinarily based” on “the class of safety statutes.” Id.

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“‘Negligence per se is in effect a presumption that one who has violated a safety statute has
violated his legal duty to use due care.’” Id. (quoting 57A Am. Jur. 2d Negligence § 727
(1989)). The doctrine of negligence per se “traditionally” arises in cases where personal injury
and physical injury to property are involved. Lowdermilk, 91 S.W.3d at 628.
Upon determining whether the statute at issue may be the premise of negligence per se, a
court must consider “legislative intent,” and determine whether the statute was “intended to
replace the standard of care in a negligence action.” Id. at 629. In Lowdermilk, 91 S.W.2d at
628, the court stated that it was not aware of any Missouri case that “extended the negligence per
se doctrine to cases which involve damage to economic interests.”
The court also held, in Lowdermilk, 91 S.W.3d at 630, that where a statute fails to
provide a basis for negligence per se, a court need not address whether any of the remaining
requirements for negligence per se are satisfied. .
DISCUSSION
In its Motion for Judgment on the Pleadings, Starwood contends that Plaintiff’s
negligence per se claim is not cognizable because the legislature did not expressly or implicitly
intend “the MDUPA for use in a Private Cause of Action for Negligence per se.” (ECF 25 at 3).
Starwood also contends that Plaintiff’s negligence per se is not cognizable because the MDUPA
is not a safety statute. (ECF 25 at 5). Plaintiff argues that the MDUPA does create a private
cause of action; that Missouri law does not limit a claim for negligence per se to safety statutes;
and that, therefore, her claim of negligence per se is cognizable. (ECF 37).
Plaintiff’s Complaint alleges the first element of a cause of action for negligence per se;
she alleges that a statute, the MDUPA, has been violated. See Clemons, 585 F.3d. at 1124. The
Court must, therefore, consider the legislative intent of the MDUPA, to determine whether the

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MDUPA creates a private cause of action which replaces the common law standard of
negligence. See Lowdermilk, 91 S.W.3d at 628.
A statute does not create a private cause of action unless it appears by “express terms or
clear implication” to have been the legislative intent. Imperial Premium Fin., Inc. v. Northland
Ins. Co., 861 S.W.2d 596, 599 (Mo. Ct. App. 1993). Plaintiff has not suggested that the
MDUPA expressly creates a private cause of action to replace the common law standard for
negligence. Rather, relying on various provisions of the MDUPA, Plaintiff argues that the
MDUPA impliedly creates such a cause of action. Under Missouri law, “[a] private right of
action will not be implied [] when it does not promote or accomplish the primary goals of the
statute.” Imperial Premium, 861 S.W.2d at 599 (citing Shqeir v. Equifax, Inc., 636 S.W.2d 944,
948 (Mo. 1962) (en banc)). As for a statute’s implying a private cause of action, the Missouri
Supreme Court holds that, “[t]he creation of a private right of action by implication is not
favored, and the trend is away from judicial inferences that a statute's violation is personally
actionable.” Shqeir, 636 S.W.2d at 947.
In regard to the MDUPA’s implying a private right of action for negligence per se,
Plaintiff contends that, “[b]ecause the MDUPA defines the conduct of a reasonable person when
surrendering the property of another to the State, the violation of such conduct, as alleged [by
Plaintiff], gives rise to a claim for negligence per se.” Plaintiff also argues that the immunity
provided by MDUPA § 447.545.1 for “holders who properly transfer property pursuant to the
Act further supports the conclusion that it may serve a basis for negligence per se.” (ECF 37 at
4).
Indeed, MDUPA § 447.545.1 provides immunity to any person who pays or delivers
abandoned property pursuant to MDUPA §§ 447.500 to 447.595 and relieves such persons “of

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all liability for any claim” made in respect to the property. See n.1. Also, a standard of care
requiring “reasonable and necessary diligence” is established by MDUPA § 447.539.5. See n.3.
The statutory scheme of the MDUPA, however, also provides a means of enforcement. The
Treasurer “may impose a penalty . . . of up to twenty percent of the value of the property
returned to the owner by the [T]reasurer” when “the person holding the property presumed
abandoned failed to exercise such reasonable and necessary diligence as is consistent with good
business practices.” MDUPA § 447.539.7
Although Plaintiff argues that the statutory immunity provided by the MDUPA creates a
private cause of action, the Missouri Supreme Court’s decision in Shqeir, 636 S.W.2d at 948,
establishes otherwise. While the private cause of action at issue in Shqeir was not one for
negligence per se, the Missouri Supreme Court unequivocally held that, “[w]hen the Legislature
has established other means of enforcement, [Missouri does] not recognize a private civil action
unless such appears by clear implication to have been the legislative intent.” Id. The MDUPA
does provide “other means of enforcement” and does not provide “by clear implication” that it
was intended to create a private right of action.
Plaintiff contends that the “mere fact that a statute [such as the MDUPA] does not
explicitly or implicitly create a private right of action does not preclude a claim for negligence
per se where the statute establishes the standard of care by which [to] determine a defendant’s
negligence.” (ECF 37 at 5). In support of this argument, Plaintiff cites I.S. v. Washington
University, 2011 WL 2433585 (E.D. Mo. June 14, 2011) (unreported). Plaintiff’s reliance on
that case is misplaced, however, as the issue decided in Washington University, 2011 WL
2433585, at *1-5, was whether the matter should be remanded to the state court; the defendant
had removed the matter based on federal subject matter jurisdiction; the plaintiff’s state

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complaint alleged negligence per se regarding the defendant’s disclosure of his medical
condition; and the removing defendant asserted that the negligence per se claim was a “thinlydisguised attempt to bring a private cause of action for violation of the Health Insurance
Portability and Accountability Act (HIPAA), 42 U.S.C. §§ 1320d, et. al.” Acknowledging that
HIPAA was implicated in the plaintiff’s negligence per se claim, the court rejected the
defendant’s argument, declined to exercise supplemental jurisdiction, and remanded the case to
state court. Id. at *5.
The defendant in Washington University had also filed a motion to dismiss the plaintiff’s
negligence per se claim, on the basis that the court did not have subject matter jurisdiction.
There was no dispute that HIPPA did not expressly or implicitly create a private negligence per
se cause of action. Washington University, 2011 WL 2433585, at *1 (“There is no dispute that
HIPAA does not create a private cause of action, either via § 1983 or through an implied right of
action.” “Furthermore, there is no express provision establishing a private cause of action, or
any clear implication of Missouri legislative intent to recognize a private cause of action in
Missouri statutes regarding patients’ rights.”) (internal citations omitted).

The plaintiff

contended that he was “only referencing HIPAA in order to establish the standard of care by
which to adjudge whether defendant's acts were negligent.” Washington University, 2011 WL
2433585, at *2. The court, in Washington University, 2011 WL 2433585, at *2, held that the
complaint “may stand as a state claim for negligence per se despite its exclusive reliance upon
HIPAA,” but it did not reach the merits of the plaintiff’s negligence per se claim or the
defendant’s motion to dismiss because it remanded the matter. The court’s decision only held
that the claim for negligence per se did “not raise any compelling federal interest nor [was] a
substantial federal question presented.” Although HIPAA [was] clearly implicated in the claim

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for negligence per se, said claim [fell] within that broad class of state law claims based on federal
regulations in the state court.” Washington University, 2011 WL 2433585, at *5 (internal
quotation and citation omitted). As such, the Court finds that Washington University, 2011 WL
2433585, does not support Plaintiff’s argument that a statute does not preclude an action for
negligence per se, even though it does not explicitly or implicitly create such a right, if the
statute establishes a standard of care.
In regard to Plaintiff’s argument that negligence per se need not be based on a safety
statute, as stated above, negligence per se is “ordinarily” based on safety statutes. Lowdermilk,
91 S.W.3d at 628. The MDUPA is not a safety statute, as it does not address personal injury or
physical injury to property; it addresses economic interests. See id. In Lowdermilk, the court
noted that the plaintiff failed to provide authority to extend the “negligence per se doctrine to
cases which involve damage to economic interests.” 91 S.W.3d at 628. Plaintiff in the matter
under consideration, likewise, has failed to provide such authority to the Court. Notably, in
Lowdermilk, in the context of Missouri’s regulation of Real Estate Agents and Brokers, Mo. Rev.
Stat. §§ 339.710 et seq., the court considered, that Missouri cases have held that conduct “which
constitutes untrustworthy or improper fraudulent or dishonest dealing or demonstrates bad faith
or gross incompetence,” is not a basis for negligence per se. 91 S.W.3d at 629 (citing American
Mortg. Inv. Co. v. Hardin-Stockton, 671 S.W.2d 283, 294-95 (Mo. Ct. App. 1984)). See also
Bus. Men’s Assurance, 891 S.W.2d at 455-56 (Missouri statute regulating the practices of
construction professionals does not create a private cause of action for negligence per se because
the statute’s overall purpose was to protect persons who hire architects, engineers, or surveyors);
Imperial Premium Fin. Co. v. Northland Ins. Co., 861 S.W.2d 596 (Mo Ct. App. 1993) (Missouri
statute imposing criminal penalties on insurance companies for failure to return unearned

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premiums did not create a private negligence per se cause of action).
In conclusion, the Court finds that the MDUPA does not create a private cause of action
for negligence per se, and that, therefore, the Court need not address whether any of the
remaining requirements for negligence per se are satisfied. Lowdermilk, 91 S.W.3d at 630.
Accepting as true all factual allegations of Plaintiff’s Complaint, construing the Complaint in the
light most favorable to Plaintiff, and drawing all inferences in Plaintiff’s favor, the Court further
finds that Plaintiff has failed to sufficiently plead a cause of action for negligence per se, and
that, therefore, Starwood’s Motion for Judgment on the Pleadings should be granted. Clemons,
585 F.3d. at 1124; Ashley County, 552 F.3d at 665; Lowdermilk, 91 S.W.3d at 628-30.
CONCLUSION
For the reasons stated above, the Court finds that Starwood’s Motion for Judgment on the
Pleadings should be granted.
Accordingly,
IT IS HEREBY ORDERED that Defendant Starwood Hotels and Resorts Worldwide,
Inc.’s Motion for Judgment on the Pleadings as to Plaintiff’s Negligence per se Claim in
Plaintiff’s Petition (ECF 25) is GRANTED; and
IT IS FURTHER ORDERED that Count I of Plaintiff’s Complaint is DISMISSED.
Dated this 23rd Day of August 2017.

/s/ Jean C. Hamilton
UNITED STATES DISTRICT JUDGE

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