Kenyon et al v. Singh et al

Filing 37

ORDER denying defendants' 31 motion to dismiss...see order for specifics. Signed by Honorable Joe Heaton on 11/13/2017. (cla)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
TRACI KENYON, et al.,
Plaintiffs,
vs.
GAGANDEEP SINGH et al.,
Defendants.

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NO. CIV-17-0458-HE

ORDER
Plaintiffs Traci and Tony Kenyon filed this action in state court against defendants
Gagandeep Singh, Azad Singh, Amrik Singh, Wilshire Insurance Company (“Wilshire”),
and IAT Insurance Group (“IAT”).

The claims arise out of a 2016 traffic accident in

Pottawatomie County, Oklahoma. Defendants removed the case to this court and plaintiffs
have since filed amended complaints. The second amended complaint (“complaint”)
asserts negligence, negligent entrustment, and gross negligence claims. 1 Defendants
Wilshire and IAT have filed a motion to dismiss the claims against them. [Doc. #31].
When considering whether claims should be dismissed under Fed.R.Civ.P. 12(b)(6),
the court accepts all well-pleaded factual allegations of the complaint as true and views
them in the light most favorable to the nonmoving party. S.E.C. v. Shields, 744 F.3d 633,
640 (10th Cir. 2014). To survive the motion, the complaint must allege “enough facts to
state a claim to relief that is plausible on its face” and “raise a right to relief above the
speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007). In other

1

Plaintiffs appear to assume “gross negligence” is a separate claim.

words, the facts alleged in the complaint must allow the court to infer the defendant’s
liability. Shields, 744 F.3d at 640 (citing Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)).
The Twombly/Iqbal pleading standard “is a middle ground between heightened fact
pleading, which is expressly rejected, and allowing complaints that are no more than labels
and conclusions or a formulaic recitation of the elements of a cause of action, which the
Court stated will not do.” Id. at 640–41 (quoting Khalik v. United Air Lines, 671 F.3d
1188, 1191 (10th Cir. 2012)).
The complaint alleges that Wilshire and IAT are the liability insurers for the other
defendants, who are alleged to be “motor carriers” for purposes of the claims at issue here.
Wilshire and IAT argue for dismissal of the claims against them on the basis that the
complaint does not allege a basis for a direct action. They correctly note that Oklahoma
does not ordinarily authorize direct actions against an insurer. See Daigle v. Hamilton, 782
P.2d 1379, 1383 (Okla. 1989). However, that general rule is subject to the statutory
exception set out in 47 Okla. Stat. § 230.30, which authorizes a direct action where the
Oklahoma Corporation Commission has issued a license to the motor carrier involved and
the carrier has filed a liability insurance policy with the Commission. 2 This court has

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47 OKLA. STAT. § 230.30, provides in pertinent part:
A. No license shall be issued by the Commission to any carrier until after the carrier
shall have filed with the Commission a liability insurance policy or bond covering
public liability and property damage ... and the liability and property damage
insurance policy or bond shall bind the obligor thereunder to make compensation
for injuries to, or death of, persons, and loss or damage to property, resulting from
the operation of any carrier for which the carrier is legally liable. A copy of the
policy or bond shall be filed with the Commission, and, after judgment against the

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concluded that those conditions are not satisfied merely by showing registration via the
Single State Registration System applicable to interstate carriers, but that a plaintiff must
ultimately show the obtaining of a license from the Commission and the filing of the
liability policy with it. Green v. ACE Am. Ins. Co., No. CIV-07-1377, 2008 WL 4372871
at *2-3 (W.D. Okla. Sept. 19, 2008). 3 So the question becomes whether the complaint
sufficiently alleges these elements and hence a basis for a direct action against the moving
defendants.
Wilshire and IAT argue that plaintiffs have not made, and cannot make, the
necessary showing because the claimed grounds for the statutory exception are inconsistent
with the carrier’s filings elsewhere. They ask that the court decide the issue based on taking
judicial notice of filings in other states. The court declines to do so and concludes it is
premature to resolve here any factual issues that may exist. Rather, the question now is the
sufficiency of the complaint’s allegations.
The complaint alleges, on information and belief, that the motor carrier defendants
“operate under licenses/permits with the Oklahoma Corporation Commission” and that
they “did obtain and file proof of insurance with the OCC.” These factual allegations are
sufficient to state a basis for invoking the statutory exception and hence a basis for a direct

carrier for any damage, the injured party may maintain an action upon the policy
or bond to recover the same, and shall be a proper party to maintain such action.
3

Plaintiffs argue the court should reconsider its view of the reach of the statute in light of
contrary results reached by some Oklahoma trial courts. However, in the absence of more specific
guidance from the Oklahoma appellate courts, the court is unpersuaded that its view as stated in
Green is wrong.

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claim against Wilshire and IAT. If further proceedings establish that, in light of the filings
elsewhere or otherwise, plaintiffs lacked a good faith basis for their “information and
belief” allegations, that may have eventual consequences for plaintiffs. But that possibility
does not warrant dismissal now, where the issue is the facial sufficiency of the facts pleaded
in the complaint.
In any event, the complaint sufficiently alleges a basis for a direct claim against
Wilshire and IAT based on 47 OKLA. STAT. §230.30. Their motion to dismiss [Doc. #31]
is therefore DENIED.
IT IS SO ORDERED.
Dated this 13th day of November, 2017.

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