Winkler et al v. The Hartford Financial Services Group, Inc.

Filing 16

ORDER Granting 5 Motion for a More Definite Statement and Denying in Part and Granting in Part, without Prejudice, 4 Motion to Dismiss. As no Defendants remain, the Clerk of the Court is directed to close this case. Signed by Chief Judge Roger L. Hunt on 5/3/11. (Copies have been distributed pursuant to the NEF - ASB)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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***

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DONALD WINKLER, individually, and
CLAUDIA WINKLER, individually,

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)
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Plaintiffs,
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vs.
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THE HARTFORD FINANCIAL SERVICES )
GROUP, INC., a corporation; DOES I through )
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X, inclusive; and ROE CORPORATIONS I
through X, inclusive,
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Defendants.
)
_______________________________________)

Case No.: 2:10-cv-02222-RLH-LRL
ORDER
(Motion to Dismiss–#4, Motion for
More Definite Statement–#5)

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Before the Court is Defendant The Hartford Financial Services Group, Inc.’s

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Motion to Dismiss (#4, filed Dec. 21, 2010). The Court has also considered Plaintiffs Donald and

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Claudia Winklers’ Opposition (#8, filed Jan. 10, 2011), and Defendant’s Reply (#11, filed Jan. 19,

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2011).
Also before the Court is Defendant’s Motion for More Definite Statement (#5, filed

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De. 21, 2010). The Court has also considered Plaintiffs’ Opposition (#8, filed Jan. 10, 2011), and

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Defendant’s Reply (#11, filed Jan. 19, 2011).

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BACKGROUND

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This dispute arises from Property & Casualty Insurance Company of Hartford’s

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(“The Hartford”) denial of Donald Winkler’s insurance claim. The following facts are as alleged

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by Plaintiffs unless otherwise noted. In February 2009, Donald Winkler was rear ended while

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driving on the I-15 freeway by an under insured motorist, one Curtis Pastian. Mr. Winkler

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suffered injuries and incurred more than $231,000,00 in medical expenses and will likely require

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future treatment as well. The Winklers had previously purchased an insurance policy from The

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Hartford, which included under insured motorist (“UIM”) coverage. After Pastian’s insurer paid

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out the $50,000.00 policy limit to the Winklers, the Winklers made a UIM claim to The Hartford.

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The Hartford has not offered to settle the claim, nor has it paid out any benefits on the claim.

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On October 8, 2010, the Winklers filed suit in the Eighth Judicial District Court of

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the State of Nevada alleging (1) breach of contract, (2) violation of Nevada’s Unfair Claims

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Practices Act, (3) breach of the covenant of good faith and fair dealing, and (4) an unnamed claim

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appearing to be loss of consortium. Though the Winklers have not served Defendant, Defendant

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removed the case to this Court based on diversity jurisdiction. Now before the Court are a motion

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to dismiss and a motion for a more definite statement. The motion to dismiss seeks dismissal of

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all claims except for the breach of contract claim. For the reasons discussed below, the Court

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grants the motion to dismiss in part and denies it in part and grants the motion for a more definite

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statement.

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DISCUSSION
I.

Motion to Dismiss
A.

Legal Standard

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A court may dismiss a plaintiff’s complaint for “failure to state a claim upon which

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relief can be granted.” Fed. R. Civ. P. 12(b)(6). A properly pled complaint must provide “a short

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and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P.

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8(a)(2); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). While Rule 8 does not require

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detailed factual allegations, it demands “more than labels and conclusions” or a “formulaic

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recitation of the elements of a cause of action.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009)

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(citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). “Factual allegations must be enough to rise

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above the speculative level.” Twombly, 550 U.S. at 555. Thus, to survive a motion to dismiss, a

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complaint must contain sufficient factual matter to “state a claim to relief that is plausible on its

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face.” Iqbal, 129 S. Ct. at 1949 (internal citation omitted).

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In Iqbal, the Supreme Court recently clarified the two-step approach district courts

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are to apply when considering motions to dismiss. First, a district court must accept as true all

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well-pled factual allegations in the complaint; however, legal conclusions are not entitled to the

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assumption of truth. Id. at 1950. Mere recitals of the elements of a cause of action, supported

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only by conclusory statements, do not suffice. Id. at 1949. Second, a district court must consider

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whether the factual allegations in the complaint allege a plausible claim for relief. Id. at 1950. A

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claim is facially plausible when the plaintiff’s complaint alleges facts that allows the court to draw

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a reasonable inference that the defendant is liable for the alleged misconduct. Id. at 1949. Where

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the complaint does not permit the court to infer more than the mere possibility of misconduct, the

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complaint has “alleged—but not shown—that the pleader is entitled to relief.” Id. (internal

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quotation marks omitted). When the claims in a complaint have not crossed the line from

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conceivable to plausible, plaintiff’s complaint must be dismissed. Twombly, 550 U.S. at 570.

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Also, “documents ‘whose contents are alleged in a complaint and whose

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authenticity no party questions, but which are not physically attached’” to the pleading, may be

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considered in ruling on a Rule 12(b)(6) motion to dismiss. In re Silicon Graphics Inc. Sec. Litig.,

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183 F.3d 970, 986 (9th Cir. 2002) (superseded by statute on other grounds) (quoting Branch v.

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Tunnell, 14 F.3d 449, 454 (9th Cir. 1994)). Therefore, the Court may consider the Winklers’

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insurance policy attached to Defendant’s motion (#4, Ex. A, Insurance Policy) as the complaint

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alleges the policy and no party questions its authenticity.

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B.

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Timing
The Winklers first contend that both of these motions are premature as they have

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yet to serve the Defendant with the complaint and, more specifically to the motion to dismiss,

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have not yet conducted the discovery necessary “to enable them to articulate the facts necessary to

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establish their claims for relief.” (Dkt. #8, Opp. 3:10.) Both of these arguments are without merit.

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By appearing, Defendants have waived service of process. Also, plaintiffs are required to plead

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facts establishing a plausible claim, not mere recitations of the elements of a cause of action,

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before they conduct discovery. Therefore, these motions are timely.

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C.

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Correct Parties
Defendant The Hartford Financial Services Group, Inc. argues that it is incorrectly

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named as the Defendant in this case and that the policy issuer was actually Property & Casualty

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Insurance Company of Hartford, also known as The Hartford. A perfunctory review of the

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insurance policy demonstrates that this is clearly the case, (Dkt. #4, Mot. Ex. A, Insurance Policy),

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and the Winklers do not dispute that they named the wrong party. This matter has been resolved

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by a stipulation to substitute the correct party and the issue is moot.

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D.

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Violation of Nevada’s Unfair Claims Practices Act
The Winklers do not allege any facts supporting a claim under Nevada’s Unfair

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Claims Practices Act and do not even specify which portion of the act they allege Defendant

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violated. The Winklers merely allege that Defendant violated it with actual and/or implied

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knowledge. This is insufficient as a matter of law as it pleads no facts whatsoever. Plaintiffs

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claim that they require discovery to adequately plead this claim is unavailing. Filing a complaint

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“does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.”

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Iqbal, 129 S. Ct at 1950. Therefore, the Court dismisses this claim.

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E.

Breach of the Covenant of Good Faith and Fair Dealing (Bad Faith)
The Winklers state a claim for breach of the covenant of good faith and fair

dealing. “An insurer acts in bad faith and breaches the covenant of good faith and fair dealing that
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exists in every contract when it refuses, without proper cause, to compensate [an] insured for a

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loss covered by the policy.” Gary G. Day Constr. Co. v. Clarendon Am. Ins. Co., 459 F. Supp. 2d

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1039, 1052 (D. Nev. 2006) citing Pemberton v. Farmers Ins. Exch., 858 P.2d 380, 382 (1993).

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Further, the insurance company must deny benefits “unreasonably and with knowledge that there

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is no reasonable basis for its conduct.” Guar. Nat’l Ins. Co. v. Potter, 912 P.2d 267, 272 (Nev.

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1996). The Court finds that the Winklers claim is plausible and, therefore, shall not dismiss the

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claim.

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F.

Loss of Consortium

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The Court finds that the Winklers have not stated a claim for loss of consortium.

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The Winklers merely repeat the elements for a claim for loss of consortium rather than pleading

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facts. This is insufficient under Iqbal and Twombly. Further, it is unclear how the denial,

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wrongful or not, of insurance benefits would cause loss of consortium. It seems that the car

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accident would have caused the loss of consortium for which the insurance policy may require

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The Hartford to compensate Mrs. Winkler, not that The Hartfords denial of benefits physically

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harmed Mr. Winkler causing the loss of consortium. For these reasons, the Court dismisses this

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claim.

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G.

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Punitive Damages
Defendant argues that the Winklers cannot obtain punitive damages and therefore

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the Court should dismiss the claim for punitive damages. However, the Winklers have not

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asserted a claim for punitive damages, they merely seek punitive damages in their prayer for

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relief. As such, it is premature to make a determination on the punitive damages issue.

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H.

Leave to Amend

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In their response to the motions, the Winklers requested that the Court grant them

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leave to amend their complaint. However, they did not attach a proposed amended complaint as

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required by Local Rule 15-1. Thus the Court denies the request. Of course, the Court would

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consider a timely motion seeking leave to amend with an accompanying proposed amended

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complaint correcting the errors laid out above.

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II.

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Motion for More Definite Statement
A.

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Legal Standard
A motion for a more definite statement should not be granted unless the pleading is

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“so vague or ambiguous that a party cannot reasonably be required to frame a responsive

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pleading.” Fed. R. Civ. P. 12(e). This liberal standard is consistent with Rule 8(a) which allows

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pleadings that contain a “short and plain statement of the claim.” Motions made under Rule 12(e)

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are disfavored and rarely granted because of the minimal pleading requirements of the Federal

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Rules. Sagan v. Apple Computer, Inc., 874 F. Supp. 1072, 1077 (C.D. Cal. 1994) (citing In re

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American Int’l Airways, Inc., 66 B.R. 642, 645 (E.D. Pa. 1986)).

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B.

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Analysis
Though motions for a more definite statement are disfavored because of the

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minimal pleading standards of Rule 8, they are sometimes necessary. Here, the Winklers refer to

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American Family insurance polices and an otherwise unidentified Ms. Polito who apparently had a

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$15,000.00 insurance. These references don’t make sense in the context of the Winklers

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complaint. It seems likely that Ms. Polito was somehow involved in the accident, but this is mere

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speculation as the complaint only states that she had an insurance policy without explaining who

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she is or how she relates to the Winklers claims. The Complaint also refers to both Donald and

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Claudia Winkler as a singular plaintiff. The Complaint then states that “Plaintiff” was involved in

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a collision making it unclear whether one or both of them were in the car accident even though

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other filings make it appear that only Mr. Winkler was in the car at the time of the accident. Also,

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it seems likely that the Winklers’ counsel merely typed in American Family when meaning to

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refer to The Hartford, but this too is unclear. Therefore, the Court orders the Winklers to clarify

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these issues if they decide to seek leave to amend.

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CONCLUSION

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Accordingly, and for good cause appearing,

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IT IS HEREBY ORDERED that Defendant’s Motion for a More Definite (#5)

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Statement is GRANTED.
IT IS FURTHER ORDERED that Defendant’s Motion to Dismiss (#4) is DENIED
in part and GRANTED in part, without prejudice, as follows:
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and the claim for loss of consortium are dismissed.
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The claims for violation of Nevada’s Unfair Claims Practices Act

The claims for breach of contract and breach of the covenant of
good faith and fair dealing remain.

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Defendant The Hartford Financial Services Group, Inc. is dismissed
by stipulation of the parties.

As no Defendants remain, the Clerk of the Court is directed to close this case.
Dated: May 3, 2011.

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____________________________________
ROGER L. HUNT
Chief United States District Judge

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