UPMC et al v. CBIZ, INC. et al

Filing 72

MEMORANDUM OPINION AND ORDER denying #12 Motion to Dismiss. Thus, pursuant to Federal Rule of Civil Procedure 12(a)(4)(A), Defendants shall file an answer on or before 10/20/2017, and as more fully stated in said Memorandum Opinion and Order. Signed by Judge Kim R. Gibson on 9/29/2017. (dlg)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
UPMC d/b/a UNIVERSITY OF
PITTSBURGH MEDICAL CENTER, and
UPMC ALTOONA f/k/a ALTOONA
REGIONAL HEALTH SYSTEM,
Plaintiffs,
v.
CBIZ, INC., CBIZ BENEFITS &
INSURANCES SERVICES, INC., and
JON S. KETZNER,
Defendants.

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Case No. 3:16-cv-204
JUDGE KIM R. GIBSON

MEMORANDUM OPINION
I.

Introduction
Pending before the Court is the Motion to Dismiss (ECF No. 12) filed by Defendants CBIZ,

Inc., CBIZ Benefits & Insurance Services, Inc., and Jon S. Ketzner (collectively “CBIZ”). CBIZ’s
Motion asks the Court to dismiss the entirety of Plaintiffs’ Complaint for failure to state a claim
upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6).
This case arises from Plaintiff UPMC’s acquisition of Plaintiff Altoona Regional Health
System—an acquisition which, according to Plaintiffs, came with a $132.5 million surprise in the
form of CBIZ’s negligent understatement of Altoona Regional Health System’s pension plan
liabilities. For the reasons that follow, CBIZ’s Motion to Dismiss will be DENIED.
II.

Relevant Procedural History
On September 16, 2016, UPMC and UPMC Altoona, formerly known as Altoona Regional

Health System (“Altoona”), filed their three-count Complaint (ECF No. 1) with the Court, alleging

claims of (1) professional negligence, (2) breach of contract, and (3) negligent misrepresentation
against CBIZ. On November 23, 2016, CBIZ filed the present Motion to Dismiss (ECF No. 12) and
its accompanying Brief in Support (ECF No. 13). UPMC and Altoona filed their Opposition to
Defendants’ Motion to Dismiss on January 4, 2017 (ECF No. 29), followed by CBIZ’s Reply in
Support of Their Motion to Dismiss on February 2, 2017 (ECF No. 32), UPMC and Altoona’s
Supplemental Memorandum in Opposition to Defendants’ Motion to Dismiss on April 10, 2017
(ECF No. 45), and, finally, CBIZ’s Response to Plaintiffs’ Supplemental Brief on April 17, 2017
(ECF No. 46).
III.

Factual Allegations Set Forth in the Complaint
The following facts, which the Court accepts as true in deciding CBIZ’s Motion to Dismiss,

are alleged in the Complaint (ECF No. 1).
UPMC owns and operates nonprofit healthcare facilities in and around Pittsburgh,
Pennsylvania and is the parent and supporting organization for numerous other nonprofit
healthcare providers throughout the Commonwealth. (ECF No. 1 ¶ 1.) Altoona Regional Health
System operated healthcare facilities in Altoona, Pennsylvania and the surrounding area. (Id. ¶
2.)
Until July 1, 2013, Altoona Regional Hospital operated two noncontributory defined
benefit pension plans covering all employees who met certain eligibility requirements (“the
Plans”). (Id. ¶¶ 3, 16.) On July 1, 2013, UPMC acquired Altoona Regional Health System and
renamed it “UPMC Altoona.” (Id. ¶ 3.) As part of this transaction, UPMC acquired all of
Altoona’s assets and liabilities, including the Plans. (Id. ¶ 3.) Shortly thereafter, Altoona merged

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the two Plans and, on December 31, 2014, UPMC merged the now-singular Altoona Plan into
UPMC’s pension benefit plan. (Id. ¶ 16.)
From approximately 2002 through February 2015, Altoona engaged CBIZ to provide
actuarial evaluation services for the Plans for a substantial fee. (Id. ¶¶ 10, 23.) These services,
which CBIZ represented itself to Altoona as being experienced, qualified, and capable of
providing, included (1) the calculation of benefits owed for purposes of funding the Plans in
compliance with ERISA requirements and for the determination of premiums owed to the
Pension Benefit Guaranty Corporation (“PBGC”); (2) valuing the Projected Benefit Obligation
expense under Generally Accepted Accounting Principles (“GAAP”) for the purpose of including
the pension plan expenses in Altoona’s financial statements; (3) certifying the Plans’ funded
ratios; (4) preparing required filing such as schedules to the Plans’ annual Form 5500s to its
regulators; and (5) certifying the Plans’ PBGC premium filings. (Id. ¶¶ 22, 24.)
Defendant Jon S. Ketzner, a CBIZ, Inc. and CBIZ B&I, Inc. employee until January 1, 2015,
was the “lead and sole actuary” engaged to value the obligations and liabilities on the Plans. (Id.
¶ 7.) Ketzner is an Enrolled Actuary, a Member of the American Academy of Actuaries, a Fellow
of the Conference of Consulting Actuaries, and a Member of the American Society of Pension
Professional and Actuaries’ College of Pension Actuaries. (Id.) Accordingly, he is bound to follow
and uphold actuarial standards of professional conduct and competence. (Id.)
However, according to the Complaint, from at least July 2008 through February 2015,
CBIZ and Ketzner failed to adhere to these actuarial standards of practice and, consequently,
undervalued the Plans’ liabilities for funding, compliance, and accounting purposes. (Id. ¶ 29.)
Allegedly, CBIZ admits to committing three substantial mistakes in its valuation that understated

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the liabilities under the Plan by at least $132.5 million. (Id. ¶¶ 32-33.) Until March 2015, this
undervaluation was undisclosed, unknown, and unknowable by Altoona and UPMC because the
undervaluation was the result of erroneous assumptions and methodologies undisclosed in the
reports produced by CBIZ. (Id. ¶ 31.) In early March 2015, Alvin Winters, another CBIZ actuary
who began reviewing the Altoona valuation upon Ketzner’s retirement in early 2015, discovered
and disclosed the serious errors in Ketzner’s assumptions and methodology. (Id.)
The Complaint specifically identifies two injuries that Altoona suffered from CBIZ’s
alleged errors. First, had CBIZ valued the Plans properly, the Plans would have mandatorily
“frozen”—one plan on October 1, 2011 and the other plan on October 1, 2012—due to insufficient
funding, and no new benefits would have accrued to any participants. (Id. ¶ 34.) Second, UPMC
and Altoona “may” be required to pay excise taxes, penalties, interest, and back premiums to the
Internal Revenue Service (“IRS”) and the PBGC. (Id. ¶¶ 57-59.) 1 Additionally, the Complaint
states that UPMC suffered damages of at least $142 million dollars when it acquired Altoona’s
unexpectedly high pension liabilities. (Id. ¶ 76.)
IV.

Jurisdiction and Venue
UPMC is a Pennsylvania nonprofit corporation with its principal place of business in

Pittsburgh, Pennsylvania.

(ECF No. 1 ¶ 1.) Altoona is likewise a Pennsylvania nonprofit

corporation, with its principal place of business in Altoona, Pennsylvania. (Id. ¶ 2.) Plaintiffs
allege that CBIZ, Inc. is a Delaware corporation with its principal place of business in Cleveland,

A number of other factual allegations, especially pertaining to facts relevant to the elements of the tort of
negligent misrepresentation, are discussed in greater detail when relevant in the Court’s discussion infra.

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Ohio, that CBIZ B&I is a Missouri corporation, 2 and that Ketzner resides in Maryland. 3 (Id. ¶¶ 47.) Plaintiffs seek damages “in an amount no less than” $142 million. (Id. at 18.) Thus, this case
is between citizens of different states and the amount in controversy exceeds $75,000. This Court,
therefore, has subject-matter jurisdiction over plaintiffs’ claims under 28 U.S.C. § 1332(a)(1). And
because a substantial part of the alleged events giving rise to Plaintiffs’ claims occurred within
the Western District of Pennsylvania, venue is proper in this district under 28 U.S.C. § 1391(b)(2).
V.

Standard of Review
A complaint may be dismissed under Federal Rule of Civil Rule 12(b)(6) for “failure to

state a claim upon which relief can be granted.” Connelly v. Lane Const. Corp., 809 F.3d 780, 786
(3d Cir. 2016). But detailed pleading is not generally required. Id. The Rules demand only “a
short and plain statement of the claim showing that the pleader is entitled to relief” in order to
give the defendant fair notice of what the claim is and the grounds upon which it rests. Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Fed. R. Civ. P. 8(a)(2)).
Under the pleading regime established by Twombly and Iqbal, a court reviewing the
sufficiency of a complaint must take three steps. 4 First, the court must “tak[e] note of the elements
[the] plaintiff must plead to state a claim.” Ashcroft v. Iqbal, 556 U.S. 662, 675 (2009). Second, the

Plaintiffs have not alleged the location of CBIZ B&I’s principal place of business. The Court does not now
raise the issue of lack of subject matter jurisdiction sua sponte. However, Plaintiffs are encouraged to enter
CBIZ B&I’s principal place of business on the record.
3 Presumably, Ketzner’s residence in Maryland also means that he is domiciled in and, thus, a citizen of
Maryland.
4 Although Iqbal described the process as a “two-pronged approach,” Iqbal, 556 U.S. at 679, the Supreme
Court noted the elements of the pertinent claim before proceeding with that approach, id. at 675–79. Thus,
the Third Circuit has described the process as a three-step approach. See Connelly, 809 F.3d at 787; Burtch
v. Milberg Factors, Inc., 662 F.3d 212, 221 n.4 (3d Cir.2011) (citing Santiago v. Warminster Township, 629 F.3d
121, 130 (2010)).
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court should identify allegations that, “because they are no more than conclusions, are not
entitled to the assumption of truth.” Id. at 679; see also Burtch v. Milberg Factors, Inc., 662 F.3d 212,
224 (3d Cir. 2011) (quoting Santiago v. Warminster Twp., 629 F.3d 121, 131 (2010)) (“Mere
restatements of the elements of a claim are not entitled to the assumption of truth.”). Finally,
“[w]hen there are well-pleaded factual allegations, [the] court should assume their veracity and
then determine whether they plausibly give rise to an entitlement to relief.” Iqbal, 556 U.S. at 679.
“A claim has facial plausibility when the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.; see
also Connelly, 809 F.3d at 786. Ultimately, the plausibility determination is “a context-specific task
that requires the reviewing court to draw on its judicial experience and common sense.” Iqbal,
556 U.S. at 679.
VI.

Discussion
CBIZ has moved to dismiss the Complaint in its entirety based on three primary

arguments: (1) Count 1 and Count 2 should be dismissed for failure to allege damages, (2) Count
1 should be dismissed because Pennsylvania law does not recognize a claim for professional
negligence against actuaries, and (3) Count 3 should be dismissed for failure to allege “any” of
the essential elements of a negligent misrepresentation claim. (ECF No. 13.) The Court will
address each of CBIZ’s three theories in turn.
A.

Count 1 and Count 2 Will Not Be Dismissed for Failure to Allege Damages
1. CBIZ’s Argument

In Count 1 and Count 2 of the Complaint, Altoona—and only Altoona—brings claims of
negligence and breach of contract against CBIZ. (ECF No. 1 at 15-16.) CBIZ responds by arguing

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that “[b]oth counts should be dismissed for failure to allege damages, because Altoona benefited
by UPMC’s assumption of the alleged $123 million 5 pension obligation.” (ECF No. 13 at 6.) Citing
a number of cases—most of which are merely persuasive and all of which are distinguishable,
CBIZ argues that, in both contract and tort claims, damages must be offset by any benefits
conferred on the plaintiff. (Id. at 6-7.) CBIZ further contends that this is precisely the situation
alleged by the Complaint, i.e., any alleged harms suffered by Altoona was fully assumed by
UPMC, so Altoona itself was not injured. (Id.)
In fact, CBIZ goes one step further and posits the theory that, not only was Altoona not
injured, but Altoona actually received a “windfall.” (Id. at 7.) CBIZ argues that, as pleaded in the
Complaint, Altoona benefited from CBIZ’s alleged negligence and breach of contract because
UPMC likely would not have acquired Altoona or would have negotiated a less favorable deal
for Altoona had UPMC been aware of the full pension obligation. (Id.) In essence, CBIZ suggests
that it actually did Altoona a favor by allegedly performing severely flawed calculations because
Altoona was able to transfer all of its pension liabilities to an unwitting UPMC—a transfer which
would not have occurred, at least on the terms on which it did, unless CBIZ’s flawed evaluations
had concealed the true extent of Altoona’s pension liabilities. (Id.)
In response to Altoona’s allegation of damages in the form of excise taxes, penalties,
interest, and back premiums to the IRS and the PBGC (ECF No. 1 ¶¶ 57-59), CBIZ suggests that

CBIZ’s brief repeatedly states that the error in the actuarial evaluation is $123 million. (ECF No.13 at 4, 6,
7.) However, the Complaint alleges that the amount of the error was $132.5 million in the final year that
CBIZ provided actuarial valuation services, i.e., 2014. (ECF No. 1 ¶¶ 11, 33.) While this disagreement of
$9.5 million is scarcely important for resolving CBIZ’s Motion to Dismiss, the Court will assume the truth
of the amount alleged in the Complaint because the Court must assume the veracity of the allegations of
the Complaint for the purposes of a motion to dismiss. Iqbal, 556 U.S. at 679.

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these allegations amount to nothing more than potential future damages that are too speculative
to make out a cognizable claim. (ECF No. 13 at 7.) Moreover, CBIZ argues that, even if these
potential future damages are not overly speculative, UPMC also alleges that it assumed “the
anticipated regulatory burden (and the additional penalties, interest and back premiums),” so
Altoona itself suffered no harm. (Id.) Accordingly, CBIZ concludes that Count 1 and Count 2
should be dismissed for failure to allege damages.
2. The Applicable Standard
However, as Altoona points out (ECF No. 29 at 10), CBIZ misinterprets the relevant
Pennsylvania law regarding “benefits” caused by defendants’ misconduct and asks the Court to
impose a more onerous pleading standard than that required by the Federal Rules of Civil
Procedure and case law.
While neither party laid out the elements of either a professional negligence or a breach
of contract claim under Pennsylvania law in their extensive briefs, CBIZ’s argument amounts to
an assertion that the Complaint fails to include sufficient factual allegations such that the Court
can reasonably infer that Altoona suffered actual harm—an essential element of both Count 1 and
Count 2. See King v. Canon Hill Veterinary Clinic, Inc., No. 644 WDA 2015, 2016 WL 2647686, at *2
(Pa. Super. Ct. May, 10 2016) (quoting French v. Commonwealth Associates, Inc., 980 A.2d 623, 63041 (Pa. Super. Ct. 2009)) (providing the elements for a claim of professional negligence under
Pennsylvania law); Meyer, Darragh, Buckler, Bebenek & Eck, P.L.L.C. v. Law Firm of Malone
Middleman, P.C., 137 A.3d 1247, 1258 (Pa. 2016) (citing J.F. Walker Co., Inc. v. Excalibur Oil Grp.,

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Inc., 792 A.2d 1268, 1272 (Pa. Super. Ct. 2002)) (providing the elements of a breach of contract
claim under Pennsylvania law). 6
The crux of this damages dispute is the applicability of the Restatement (Second) of Torts
§ 920 (Am. Law Inst. 1979) (“Section 920”). See Ellis v. Sherman, 515 A.2d 1327, 1329 (Pa. 1986)
(recognizing this section as applicable in Pennsylvania tort actions); Gorski v. Smith, 812 A.2d 683,
709 (Pa. Super. Ct. 2002) (same). Unsurprisingly, CBIZ believes that Section 920 dictates that the
Complaint has failed to allege damages, and Altoona believes that Section 920 does not apply. 7
The Court agrees with Altoona.
In its entirety, Section 920 states:
When the defendant’s tortious conduct has caused harm to the plaintiff or to his
property and in so doing has conferred a special benefit to the interest of the
plaintiff that was harmed, the value of the benefit conferred is considered in
mitigation of damages, to the extent that this is equitable.
Restatement (Second) of Torts § 920. The direct language of Section 920 requires that the “special
benefit” be both conferred by the defendant and that the benefit directly relate to the harm caused
by the defendant’s tortious conduct. See id.; see also id. §920 cmt. d (“Under the rule stated in this
Section to justify a diminution of damages the benefit must result from the tortious conduct.”).
Furthermore, Section 920’s plain text requires that the Court consider the equity of reducing
damages by a benefit. See Restatement (Second) of Torts § 920; id § 920 cmt. f.

In Plaintiffs’ Supplemental Memorandum, Altoona states that CBIZ is raising an affirmative defense of
mitigation of damages for which CBIZ bears the burden of proof. (ECF No. 45 at 5.) However, the Court
agrees that CBIZ’s argument is more fundamental, i.e., CBIZ contends that Altoona has not alleged facts
sufficient to show damages at all. (ECF No. 46 at 4-5.)
7 The parties’ arguments on damages and Section 920 appear in all five briefs. (ECF Nos. 13, 29, 32, 45, 46.)
6

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3. CBIZ Did Not Confer a Benefit on Altoona
While CBIZ argues that it benefited Altoona by creating the illusion of a rosier pension
obligation, therein encouraging or inducing UPMC to acquire Altoona, CBIZ did not “confer[] a
special benefit to the interest of the plaintiff that was harmed.” Id. § 920. To the contrary, UPMC
unwittingly conferred the benefit on Altoona—not CBIZ. CBIZ may have authored inaccurate
reports on Altoona’s pension obligations, but CBIZ’s flawed calculations did not confer an
offsetting benefit on Altoona.

UPMC and its decision to fully assume Altoona’s pension

obligations conferred the benefit.
Although Pennsylvania case law is relatively scarce on Section 920, the Pennsylvania
Superior Court has offered guidance in a case in which the appellants made a nearly identical
argument to that made by CBIZ here. See Gorski, 812 A.2d at 709-10. And, as with the appellants’
argument in Gorski, CBIZ’s argument is unavailing. Id. In Gorski, Caesar Gorski and Saranne
Gorski (“the Gorskis”) brought an action against their attorney and his law firm (“the appellants”)
for negligence and breach of contract relating to the preparation and negotiation of a land sales
agreement. See id. at 688-90. A jury found the appellants to have been negligent in representing
the Gorskis in their negotiation of the land sales agreement and in the litigation that followed
against the potential buyer. Id. at 690. On appeal, the appellants raised a number of arguments,
including that the Gorskis suffered no actual harm. Id. at 708.
The Superior Court summarized the appellants’ argument as follows:
In Appellants’ next issue they contend that the Gorskis did not suffer actual
damages as a result of their breach of contract and negligence. Appellants posit
that not only did the Gorskis not suffer damages but Appellants maintain that, in
fact, the reverse occurred and that the Gorskis actually profited by the malpractice.
Appellants calculate that the Gorskis ultimately received approximately $260,000

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more than they would have originally as the result of the malpractice. Appellants
theory is apparently based on the fact that the Gorskis eventually sold the subject
property for 1.4 million dollars and paid lacobucci $425,000. Thus, by Appellants
view, the Gorskis netted $975,000. Had the Gorskis sold the property to lacobucci
to begin with, Appellants reason, the Gorskis would have received a mere
$710,000, what the contract price called for. Hence, because of this apparent
“windfall,” Appellants maintain that the Gorskis are not entitled to recovery since
they cannot show actual damages.
Id. at 708-09. The Superior Court proceeded to identify Section 920 as the applicable articulation
of the “benefit rule” and concluded that “this section does not apply when the tortious conduct
of the defendant did not directly confer on the plaintiff a ‘special benefit.’” Id. at 709 (citing
Restatement (Second) of Torts § 920 cmt. d; id. § 920, illus. 9).
In rejecting the appellants’ argument under the “benefit rule,” the Superior Court
explained:
In the case at bar, the actions which the jury found constituted breach of contract
and legal malpractice did not directly confer any benefit on the property held by
the Gorskis, nor did those actions directly result in any increase in the value of the
Gorskis property. Any increase in the selling price of the property was the result
of the sewer authority’s subsequent correction of the infiltration and capacity
problem. That action, however, did not relieve the Gorskis of their liability to
lacobucci under the terms of the original land sales agreement. The amounts
which the Gorskis were forced to pay lacobucci were direct financial losses
sustained by them and those losses unquestionably diminished the net amount
which they eventually realized from the subsequent sale of the property.
Id. at 709-10. Likewise, in the present case, CBIZ’s alleged breach of contract and negligence did
not directly confer any benefit on Altoona or its pension obligations.

CBIZ’s alleged

miscalculations certainly did not reduce the pension liability or otherwise lessen that burden.
Rather, much like the sewer authority’s subsequent correction of the infiltration and capacity
problem in Gorskis, see id., UPMC—not CBIZ—relieved the pension liabilities from Altoona and
conferred the benefit. See Restatement (Second) of Torts § 920, illus. 8. Therefore, Section 920

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does not eliminate the damages alleged by Altoona, 8 at least at this early stage in the proceedings,
because Section 920 and Gorski require that CBIZ have directly conferred the benefit.
CBIZ cites numerous cases to support its proposition that the “benefit rule” should apply
to nullify any harm Altoona suffered. (ECF No. 13 at 6-7.) However, these authorities are largely
non-binding authority that do not apply Pennsylvania law and, unlike Gorski, are all inapposite.
See LaSalle Talman Bank, F.S.B. v. United States, 317 F.3d 1363, 1371-72 (Fed. Cir. 2003) (applying
federal law to allow mitigation of damages when a contract was breached in good faith by the
defendant’s adherence to a newly-passed federal statute and the plaintiff mitigated damages
through a substitute transaction and emphasizing that this mitigation cannot be too remote and
is “limited to profits directly due to the action in mitigation”); Fishman Org., Inc. v. Frick Transfer,
Inc., 564 F. App’x 649, 651 (3d Cir. 2014) (disallowing credit for rent paid when the plaintiff used
the rented space for which he paid the rent); S&K Sales Co. v. Nike, Inc., 816 F.2d 843, 852-53 (2d
Cir. 1987) (applying New York law to allow mitigation for expenses of doing business to be
deducted from lost profits and requiring that the benefit “have accrued to the plaintiff because of
the breach”); Blum v. Witco Chem. Corp., 829 F.2d 367, 373 (3d Cir. 1987) (allowing the recovery of
front pay while noting that, under the ADEA, a greatly increased salary from subsequent
employment could offset loss of pension benefits); Fariss v. Lynchburg Foundry, 769 F.2d 958, 96768 (4th Cir. 1985) (holding that, in an ADEA case, the plaintiff’s claims for back wages and life
insurance premiums were fully offset by a lump sum he received from his employer at

Specifically, the Complaint alleges damages in the form of (1) the cost of a $132.5 million understatement
of the pension obligation; (2) an immediately due $60 million higher payment in 2014 than the $6.6 million
that had been budgeted based on CBIZ’s valuation; (3) the added liabilities that Altoona incurred when the
statutorily-required “freeze” on the Plans was not triggered due to CBIZ’s miscalculations; and (4)
penalties, interest, and premiums to the IRS and PBGC. (ECF No. 1 ¶¶ 14, 31, 33-34, 57-50.)
8

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termination); Brown v. Medtronic, Inc., 619 F. Supp. 2d 646, 650 (D. Minn. 2009) (allowing
mitigation in an ERISA case where the defendant’s breach of fiduciary duty through an
investment in artificially inflated stock actually resulted in a gain because the stock was sold by
the plaintiff for a gain at the artificially inflated price); In re Boston Sci. Corp. ERISA Litig., 254
F.R.D. 24, 32 (D. Mass. 2008) (same).
4. The Court Will Not Make a Determination of the Equity of Mitigation at this
Early Stage
Beyond failing to satisfy Section 920’s requirement that the defendant must directly
confer the offsetting benefit as part of the same conduct, CBIZ glosses over the final condition of
the Restatement. Section 920 requires that the Court consider mitigation damages “to the extent
that it is equitable.” Gorski, 812 A.2d at 709 (quoting Restatement (Second) of Torts § 920). The
Court will not make an equitable determination to eliminate well-pleaded damages alleged to be
in excess of $142 million at the motion to dismiss stage.
CBIZ argues that the Restatement’s reference to equity is intended only to limit the
plaintiff’s recovery and prevent windfall to the plaintiff—not to benefit the plaintiff. (ECF No. 32
at 3.) CBIZ finds some support in Comment f of Section 920, but chooses to quote, out of context,
only those portions of the comment’s text that support its view. Read in its entirety,9 Comment f

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In its entirety, the relevant comment reads:
f. Equitable considerations. The rule stated in this Section is limited by the general principle
underlying the assessment of damages in tort cases, which is that an injured person is
entitled to be placed as nearly as possible in the position he would have occupied had it
not been for the plaintiff’s tort. This principle is intended primarily to restrict the injured
person’s recovery to the harm that he actually incurred and not to permit the tortfeasor to
force a benefit on him against his will. Thus, when a person has land or chattels that he
has devoted to a particular purpose, he is entitled to continue to use them for that purpose,
and the person who interferes with the use is not entitled to have damages mitigated by
the fact that he has added to their market value. In these cases the good faith, and

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does not state that equitable considerations must be used only to the detriment of plaintiffs. To
the contrary, the comment emphasizes that officious intermeddlers who increase the market
value of another’s property through tortious conduct are generally still liable to the owner if the
owner has acted reasonably in restoring the property to its original condition, even if that original
condition is of less monetary value. See Restatement (Second) of Torts § 920 cmt. f. Comment f
does endorse the basic tort principle that meritorious plaintiffs should be placed in the position
they would have occupied had it not been for the defendant’s wrongdoing, but it certainly does
not suggest that the Court should disregard well-pleaded allegations of damages at the motion
to dismiss stage based on equitable considerations. See id. Accordingly, the Court is not
endorsing an “over-recovery” or windfall for Altoona; the Court is simply recognizing that the
Complaint includes sufficient factual allegations for the Court to reasonably infer that Altoona
suffered harm.
5. The Allegations of Fine and Penalty Damages Are Not Too Speculative
As discussed supra Part VI.A.1, CBIZ also argues that Altoona’s allegations of damages
regarding excise taxes, penalties, interest, and back premiums to the IRS and the PBGC (ECF No.
1 ¶¶ 57-59) are too speculative to make out a cognizable claim. (ECF No. 13 at 7.) CBIZ
specifically observes that the Complaint states that these penalties “may” occur in the future.
(ECF No. 46 at 2; ECF No. 1 ¶¶ 57-59.)

reasonableness of the attitudes, of the parties are factors in determining the measure of
recovery. Thus unless the plaintiff is capricious or spiteful and the defendant has acted by
mistake, so that his conduct was not knowingly tortious, the damages may not be
diminished by the fact that the defendant's interference has increased the monetary value
of the property. On the contrary, if the owner has acted reasonably in restoring the
property to its original condition, he may recover the cost of doing so.
Restatement (Second) of Torts § 920 cmt. f (internal citations omitted).

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Under Pennsylvania law, “damages are considered speculative only if there is uncertainty
concerning the existence of damages rather than the ability to precisely calculate the amount or
value of damages.” City of Philadelphia, Bd. of Pensions and Retirement v. Clayton, 987 A.2d 1255,
1262 (Pa. Commw. Ct. 2009) (quoting Pa. State Univ./PMA Ins. Grp. v. Workers’ Comp. Appeal Bd.
(Hensal), 911 A.2d 225, 233 (Pa. Commw. Ct. 2006)). The test of whether damages are remote or
speculative “deals with the more basic question of whether there are identifiable damages.”
Wachovia Bank, N.A. v. Ferretti, 935 A.2d 565, 572 (Pa. Super. Ct. 2007) (citing Rizzo v. Haines, 555
A.2d 58, 68 (Pa. 1989)).
In the present case, while CBIZ may be correct that the Complaint’s allegations as to the
additional fines and penalties are not a picture of perfect clarity, they need not be. Altoona’s
allegations of additional fines and penalties need only possess sufficient factual content to allow
the Court to draw the reasonable inference that the defendant is liable. See Iqbal, 556 U.S. at 679;
Connelly, 809 F.3d at 786. These allegations accomplish this threshold requirement.
As Altoona explained in its Opposition to Defendants’ Motion to Dismiss, “[t]he
Complaint states that UPMC and Altoona ‘may’ be required to make these payments as opposed
to ‘will,’ because the exact amount that UPMC and Altoona will be required to pay is pending
action by the IRS and possibly also the PBGC.” (ECF No. 29 at 4, n.5.) Although the level of
clarity captured in this explanation would have been best served within the Complaint itself, this
explanation nevertheless comports with the Court’s interpretation of these allegations of
additional fines and penalties when taking into account the context of these of allegations in the
Complaint and the totality of the allegations of the Complaint. Each of the relevant paragraphs
in the Complaint that discuss these damages regarding additional fines and penalties states that

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the damages “could exceed” a given number (ECF No. 1 ¶¶ 57-59), supporting an interpretation
of the Complaint that its expressions of uncertainty relate to the amount, not whether the
damages are identifiable. See Wachovia, 935 A.2d at 572 (citing Rizzo, 555 A.2d at 68). Therefore,
the Complaint’s allegations as to additional fines and penalties owed to the IRS and PBGC are
not speculative and will not be dismissed at this stage.
In addition, CBIZ argues that, regardless of whether these potential future damages are
speculative, UPMC also assumed “the anticipated regulatory burden (and the additional
penalties, interest and back premiums)”; thus, once again, Altoona itself suffered no harm. (ECF
No. 13 at 7.) This line of argument fails for the same reasons discussed above. See supra Part
VI.A.1-4.
6. The Breach of Contract Claim
Thus far, the majority of the Court’s discussion has focused on Section 920 and the “benefit
rule” as defined by Section 920 of the Restatement (Second) of Torts. Yet, Count 2, which CBIZ
has moved to dismiss on the same basis, is a claim for breach of contract. Because the identical
standard applies under Pennsylvania law for both Count 1 and Count 2, the Court reaches the
same result and rejects CBIZ’s claim that the Complaint failed to allege damages.
In Gorski, the Gorskis brought a breach of contract and professional negligence claim. See
Gorski, 812 A.2d at 709. Rather than performing two separate analyses, the Pennsylvania Superior
Court proceeded through a single Section 920 analysis for both the breach of contract claim and
the negligence claim. After completing this unified analysis, the Superior Court dismissed the
appellants’ request for mitigation as to both the breach of contract claim and the negligence claim
on the basis that the misconduct did not directly confer any benefit on the property held by the

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Gorskis. Id. Here, the Court’s negligence analysis above serves this same dual purpose to
conclude that the Complaint sufficiently alleges damages for breach of contract and negligence.
B.

Count 1 Will Not Be Dismissed Because the Court Predicts that the
Pennsylvania Supreme Court Would Permit Professional Negligence Claims
Against Actuaries
1. Overview

In Count 1 of the Complaint, Altoona brings a professional negligence claim against CBIZ.
CBIZ challenges this count by contending that, under Pennsylvania law, professional negligence
actions can be maintained against only certain licensed professionals. (ECF No. 13 at 15.) CBIZ
further suggests that this class of eligible defendants is limited to only those professions explicitly
listed in Pennsylvania Rule of Civil Procedure No. 1042.1 (“Rule 1042.1”). From that premise,
CBIZ’s argument is simple: actuaries are not one of the thirteen professions listed in Rule 1042.1,
and, thus, actuaries—like CBIZ—cannot be subject to professional negligence actions under
Pennsylvania law.
While CBIZ has admittedly identified some non-binding authority to support this
contention, many other authorities take the opposing view. Neither the parties’ extensive briefs
nor the Court’s own research has identified case law from the Third Circuit or the Pennsylvania
Supreme Court squarely addressing the effect of Rule 1042.1. Despite the lack of guidance from
the Pennsylvania Supreme Court and lack of consensus in federal district courts in the Third
Circuit, the Court finds the rationale articulated by those courts viewing Rule 1042.1 as a nonexhaustive list and a procedural rule to be more compelling. The Court interprets the language
and context of Rule 1042.1 to provide a procedural mechanism for professional negligence claims
brought against the thirteen professions listed therein—not a substantive bar to prevent the

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pursuit of claims against professions not included within the Rule—and concludes that case law
from the Pennsylvania Superior Court prompts such a conclusion. Consequently, the Court will
not dismiss Count 1 because the Court predicts that the Pennsylvania Supreme Court would
permit a professional negligence claim to proceed against an actuary.
2. The Four-Step Approach to Interpreting Undecided State Law
When interpreting state law, federal courts must follow the state’s highest court. Ill. Nat’l
Ins. Co. v. Wyndham Worldwide Operations, Inc., 653 F.3d 225, 231 (3d Cir. 2011). If that state’s
highest court has not provided guidance, federal courts must predict how that highest court
would resolve the issue. Id. (citing Canal Ins. Co. v. Underwriters at Lloyd's London, 435 F.3d 431,
436 (3d Cir. 2006)). To do so, federal courts must take into consideration: (1) what that state’s
highest court has said in related areas, (2) the decisional law of the state intermediate courts, (3)
federal cases interpreting state law, and (4) decisions from other jurisdictions that have discussed
the issue. Id. (citing Werwinski v. Ford Motor Co., 286 F.3d 661, 675 (3d Cir. 2002)). “Although
lower state court decisions are not controlling on an issue on which the highest court of the state
has not spoken, federal courts must attribute significant weight to these decisions in the absence
of any indication that the highest state court would rule otherwise.” Id. (quoting Wisniewski v.
Johns–Manville Corp., 759 F.2d 271, 273–74 (3d Cir. 1985)).
In following this four-step approach, the Court predicts that the Pennsylvania Supreme
Court would hold that Rule 1042.1 does not preclude professional negligence claims against
actuaries and would permit such a claim to proceed.

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3. The Effect of Pennsylvania Rule of Civil Procedure 1042.1
i.

Pennsylvania State Court Decisions 10

Beginning with state court decisions, the Pennsylvania Supreme Court has not decided
whether Rule 1042.1 constitutes an exhaustive list of those professions for which a professional
negligence cause of action is available. However, at least two Pennsylvania Supreme Court
decisions, two Pennsylvania Superior Court decisions, and two Pennsylvania Court of Common
Pleas decisions point toward the conclusion that Rule 1042.1 does not substantively restrict
professional negligence claims to those thirteen professions listed within the Rule.
In regard to the two aforementioned Pennsylvania Supreme Court decisions, both of these
cases relate to the procedural nature of Rule 1042.1. See Bruno v. Erie Ins. Co., 106 A.3d 48 (Pa.
2014); Womer v. Hilliker, 908 A.2d 269 (Pa. 2006). These cases and the procedural nature of Rule
1042.1 will be discussed infra Part VI.B.3.iii.
In regard to intermediate appellate court decisions, the Pennsylvania Superior Court has
allowed professional negligence claims to proceed against insurance agents in at least two cases.
See Pressley v. Travelers Property Cas. Corp., 817 A.2d 1131, 1138 (Pa. Super. Ct. 2003); Wisniski v.
Brown & Brown Ins. Co. of Pa., 852 A.2d 1206, 1212 (Pa. Super. Ct. 2004), vacated and remanded on
other grounds, 887 A.2d 1238, 1238 (Pa. 2005). Insurance agents are not enumerated on the thirteenprofession list in Rule 1042.1. See Pa. R. Civ. P. No. 1042.1. Thus, these two decisions suggest that
at least two panels of the Pennsylvania Superior Court do not view Rule 1042.1 as an exhaustive
and substantive rule.

This section combines the first two steps of the four-step approach articulated by the Third Circuit. See
Ill. Nat’l., 653 F.3d at 231.
10

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However, the strength of this inference may be somewhat weakened because neither
Pressley nor Wisniski mention Rule 1042.1, and the Rule is not expressly considered in either
opinion. See Pressley, 817 A.2d at 1138; Wisniski, 852 A.2d at 1212. Instead, the Pressley court cites
to the Restatement (Second) of Torts § 299A (Am. Law. Inst. 1965) and, with little discussion,
concludes that the defendant is subject to a professional negligence action with the appropriate
professional standard of care because he is a “licensed insurance agent.” Pressley, 817 A.2d at
1138. While the discussion is brief, the insurance agent’s licensure appears to be key to the
Superior Court’s decision. Id. The Presley court also noted that consumers look at insurance
agents as possessing expertise in a complicated area and reasonably rely on the representations
of insurance agents as experts. Id. at 1140. Likewise, the Wisniski court allowed a professional
negligence claim to proceed against an insurance agent. Wisniski, 852 A.2d at 1212. Wisniski
simply cites to Pressley and provides no other analysis. Id. Therefore, while the weight of these
two cases is reduced due to their silence on Rule 1042.1, both cases permitted a professional
negligence claim against an “unlisted” profession to proceed without any indication that such a
claim is problematic, disfavored, or disallowed.
Lastly, in regard to Pennsylvania county courts, the Lackawanna County Court of
Common Pleas—applying Pressley, Wisnicki, and the Restatement—allowed a claim to proceed
against an insurance agency and applied a professional standard of care. See Ratchford v. Florey
Ins. Co., No. 00-CIV-2121, 2005 WL 3106478, at *9 (Pa. Ct. Com. Pls. Mar. 8, 2005). The Allegheny
County Court of Common Pleas—pre-Pressley and pre-Wisniski—faced the issue of whether a

professional negligence claim is cognizable against a computer consultant. See Rapidigm, Inc. v.

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ATM Mgmt. Servs., LLC, 63 Pa. D. & C.4th 234, 241-42 (Pa. Ct. Com. Pls. 2003). The Rapidigm
court wrote:
To date, the Pennsylvania courts have allowed professional negligence actions to
be maintained only against certain licensed professionals. However, the parties did
not cite and the research of my staff did not produce any Pennsylvania appellate
court case law that addresses the issue of whether a professional negligence action
should be restricted [to exclude computer consultants].
Id. (footnote omitted). While the court cited to Rule 1042.1, it did not consider whether the Rule
constitutes an exhaustive list. Id. at 241 n.4. Instead, the Court looked to Restatement (Second)
of Torts § 299A and concluded that computer consultants, at least in 2003, could not be subject to
professional negligence claims because “[c]ontract law provides sufficient protection to
customers/clients of service provides whose services are capable of being evaluated through the
guarantee of a defined outcome. Id. at 244. In reaching this decision, the Ratchford court cited a
number of decisions from other jurisdictions that looked to the Restatement for guidance and,
because these cases were not applying Pennsylvania law, did not consider Pennsylvania Rule of
Civil Procedure Rule 1042.1.
In sum, to the extent that Pennsylvania state decisions provide guidance, they suggest
that the Rule 1042.1 list cannot truly be exclusive because claims can be brought against the
“unlisted” profession of insurance agents and that the Restatement provides guidance as to those
areas that constitute a “profession.”
ii. Federal Court Decisions 11
a. Federal Decisions Holding that Rule 1042.1 is an Exclusive List

This section performs “step three.” See Ill. Nat’l., 653 F.3d at 231. In the present case, the Court does not
perform “step four” of the Illinois National approach because Rule 1042.1 is a Pennsylvania-specific rule of
civil procedure on which decisions from other states’ courts, if any exist, would naturally have little
bearing.
11

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CBIZ’s briefs and the Court’s independent research have unearthed at least five federal
district court opinions from the Third Circuit which hold that Rule 1042.1 is an exhaustive and
exclusive list that precludes professional negligence claims against all professions not listed
therein. 12 However, the Court’s review of these five cases reveals that none of these cases offers
significant analysis. In fact, all of these cases appear to assume, without explanation, that Rule
1042.1, despite being within the Pennsylvania Rules of Civil Procedure and not including any
language to suggest that it is exhaustive, is a substantive rule that precludes all professional
negligence claims except for those brought against the thirteen professions listed in the Rule.
Moreover, those cases that include citations to bolster their conclusion about the effect of Rule
1042.1 simply cite to earlier federal cases that provided minimal explanation or analysis. None
of these cases acknowledge the Superior Court’s decisions in Pressley or Wisniski. The Court will
examine each of these decisions in chronological order.
First, the Eastern District of Pennsylvania granted a motion to dismiss in regard to a
professional negligence action brought against providers of estate, asset, and tax planning advice.
Gilmour v. Bohmueller, No. Civ. A. 04-2535, 2005 WL 241181, at *16 (E.D. Pa. Jan. 27, 2005). Without
any explanation or discussion, the Gilmour court concluded that Rule 1042.1 “can be maintained
only against persons licensed in Pennsylvania or another state” who fall into one of the thirteen
categories of Rule 1042.1. Id. The court’s only citation for this proposition is Rule 1042.1 itself.
Id. Because the plaintiff’s complaint did not allege that the defendants were one of these thirteen
licensed professionals, the court dismissed the professional negligence claim. Id.

Three of these decisions arise from the U.S. District Court for the Eastern District of Pennsylvania, one
arises from the Middle District of Pennsylvania, and one arises from the Western District of Pennsylvania.
12

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Second, the Eastern District of Pennsylvania denied a motion to dismiss a professional
negligence claim against attorneys. In re Am. Inv’rs Life Ins. Co. Annuity Mktg. & Sales Practices
Litig., MDL Docket No. 1712, 2007 WL 2541216, at *32 (E.D. Pa. Aug. 29, 2007). In American
Investors, whether the defendant attorneys were within the scope of Rule 1042.1 was not at issue
because “attorney at law” is one of the thirteen listed professions in Rule 1042.1. Id. The issue
before the court was whether the attorneys were within a professional relationship with the
clients such that a professional negligence claim was viable. Id. However, as part of this
discussion, the American Investors court states, in passing, that professional negligence claims can
be brought against only the thirteen professions listed in Rule 1042.1. Id. As in Gilmour, the court
cites only to Rule 1042.1 and provides no reasoning or analysis for this conclusion.
Third, the Western District of Pennsylvania held that a real estate property manager
cannot be subject to a professional negligence claim under Pennsylvania law because that
profession is not included within Rule 1042.1. Greenwood Land Co. v. Omnicare, Inc., Civil Action
No. 09-686, 2011 WL 33027, at *4 (W.D. Pa. Jan. 5, 2011). As with Gilmour and American Investors,
the Greenwood court does not acknowledge the Pennsylvania Superior Court’s decisions in
Pressley or Wisiski, consider that Rule 1042.1 may be a procedural rule, or perform any analysis
except to conclude that real estate property managers are not on the Rule 1042.1 list. See id. Unlike
the prior federal cases, Greenwood does cite to the Allegheny County Court of Common Plea’s
2003 decision in Rapidigm. Id. The Greenwood court references footnote 4 of Rapidigm—which
appears to be the only authority to support the Greenwood court’s decision other than citations to
Rule 1042.1 itself. The Greenwood court quotes Rapidigm: “‘The Rules of Civil Procedure governing
professional liability actions are applicable to attorneys and other persons who are licensed

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pursuant to an Act of Assembly. Pa R. Civ. P. 1042.1.’” Id. (quoting Rapidigm, 63 Pa. D. & C.4th
at 242 n.4). From this quotation, the Greenwood court concludes that professional negligence
claims can be brought against only the thirteen enumerated professions. Id. However, this Court
determines that this quotation from Rapidigm conveys a much more modest proposition; this
quotation simply states that the portions of the Pennsylvania Rules of Civil Procedure governing
professional liability are applicable to those thirteen professions. Rapidigm does not assert that
professional negligence claims may be brought only against the listed professions; it explains that
certain procedural rules that follow Rule 1042.1 apply only to negligence claims brought against
those thirteen professions. See Rapidigm, 63 Pa. D. & C.4th at 242.
Fourth, the Eastern District of Pennsylvania twice-dismissed a professional negligence
claim against an insurance broker. See Hirsch v. Schiff Benefits Grp., LLC, Civil Action No. 10-2574,
2011 WL 1166127, at *4 (E.D. Pa. Mar. 28, 2011) (dismissing the professional negligence claim in
the original complaint); Hirsch v. Schiff Benefits Grp., LLC, Civil Action No. 10-2574, 2011 WL
2471535, at *4 (E.D. Pa. June 21, 2011) (dismissing the virtually identical claim in the amended
complaint). The Hirsch court simply cited to Gilmour and Greenwood without performing any
independent analysis, see Hirsch, 2011 WL 1166127, at *4, and stated that Rule 1042.1 “set[s] forth
an exhaustive list of licensed professionals” against whom a plaintiff may bring a negligence
action, Hirsch, 2011 WL 2471535, at *4.
Finally, the Middle District of Pennsylvania dismissed a professional negligence claim
against correctional officers. See Hatten v. Bledsoe, Civil Action No. 1:13-CV-00209, 2014 WL
5473571, at *8 (M.D. Pa. Aug. 4, 2014). The Hatten court cited only American Investors and provided

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no other explanation or analysis for why Rule 1042.1 acts as a substantive bar to professional
negligence claims against all professions not include therein.
In sum, none of these cases provided compelling rationale for their stance on Rule 1042.1
such that they persuade the Court to deviate from its own interpretation of the rule, the weight
of the state cases cited supra and infra, and the reasoning of the federal decisions taking the
opposing view discussed next.
b. Federal Decisions Holding That Rule 1042.1 is Not an Exclusive
List and Allowing Professional Negligence Claims Against
“Unlisted” Professions to Proceed
A number of decisions by federal district courts within the Third Circuit have permitted
professional negligence claims to proceed against professions not included within the Rule 1042.1
list. Looking first to decisions by the Eastern District of Pennsylvania, the Court has identified at
least three relevant cases.
First, in granting a motion to remand in a case involving a professional negligence claim
against an insurance company, the Eastern District of Pennsylvania, in dicta, observed that
Pennsylvania courts have allowed professional negligence claims against insurance agents and
applied Restatement (Second) of Torts §299A in such cases. See PNC Bank v. AmerUs Life Ins. Co.,
No. Civ. A. 04-5015, 2005 WL 226075, at *1 (Pa. E.D. Jan. 31, 2005) (citing Pressley, 817 A.2d at 1138;
Wisniski, 852 A.2d at 1212).
Second, in partially denying the defendant’s motion for summary judgment, the Eastern
District of Pennsylvania permitted two counts of professional negligence to proceed against an
actuary and his employer. See I.B.E.W. Local Union 380 Pension Fund v. Buck Consultants, Civil
Action No. 03-4932, 2008 WL 269476, at *6 (E.D. Pa. Jan. 30, 2008). The opinion repeatedly labels

-25-

the defendants as actuaries and never indicates that the defendants are accountants or any of the
other thirteen professions listed in Rule 1042.1. Id. Despite these striking similarities to the
present case, the persuasive value of I.B.E.W. is somewhat diminished because the defendants
evidently did not raise and the court did not consider or even reference Rule 1042.1 or whether
an actuary could be subject to a professional negligence claim under Pennsylvania law. The basic
viability of a professional negligence claim against an actuary is not challenged. Instead, the issue
considered in I.B.E.W. is whether the actuaries breached their professional standard of care and
proximately caused the harm. Id.
Third, in a more recent decision, the Eastern District of Pennsylvania provided a lengthier,
but still relatively brief, analysis as to the professions subject to professional negligence claims
under Pennsylvania law. See Chetty Holdings, Inc. v. NorthMarq Capital, LLC, No. Civ. A. 11-4640,
2013 WL 1721733, at *7 (E.D. Pa. Apr. 22, 2013), aff’d, 556 F. App’x 118 (3d Cir. 2014). In deciding
whether a complaint alleged sufficient facts to show that the defendants—providers of
commercial real estate financing and brokerage services—owed a duty to the plaintiffs for the
purposes of a negligence claim, the court wrote:
I find convincing, however, plaintiffs’ argument that [the defendants] were subject
to a duty as licensed professionals pursuant to Section 299A of the Restatement
(Second) of Torts . . . . Swantek v. Prudential Property & Casualty Insurance Co., 48
Pa. D. & C.3d 42 (Pa. Ct. Com. Pl., Erie Cnty. 1988), a case cited by plaintiffs and
which held that Section 299A imposed a duty of care on insurance agents, supports
the imposition of a duty on defendants. In Swantek, the Court noted that “in order
to sell insurance in [Pennsylvania], [an insurance] agent must obtain a license, and
if he or she does not, then the agent who continues to sell insurance without a
license is subject to certain sanctions including a monetary penalty.” Id. at 46. In
reaching its holding that Section 299A imposed a duty on insurance agents, the
Court remarked that “[i]t is obvious from the statutes that the commonwealth
deems an insurance agent to be a professional skilled in the business of insurance
matters.” Id. at 47. Plaintiffs have alleged that [the defendants] were subject to

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similar licensing requirements in Pennsylvania for their conduct as mortgage
brokers. Defendants have not argued that they were exempt from the cited
licensing requirements. Accordingly, I find that plaintiffs have sufficiently alleged
that defendants owed them a duty to “to exercise the skill and knowledge
normally possessed by members of [their] profession or trade in good standing in
similar communities.” Restatement (Second) of Torts § 299A.
Id. (footnote omitted). Thus, based on Swantek and the Restatement, the Eastern District of
Pennsylvania denied defendants’ motion for summary judgment as to the professional
negligence claims against the mortgage brokers because of their licensure under state law. The
court did not refer to Rule 1042.1 or any decisions other than Swantek in making this
determination.
Beyond these relatively brief discussions of the issue in opinions by the Eastern District of
Pennsylvania, one opinion authored by Judge Mannion of the Middle District of Pennsylvania
and one opinion authored by Judge Cohill of the Western District of Pennsylvania provide
considerably more extensive analysis. See Hults v. Allstate Septic System, LLP, Civil Action No.
4:06-0541, 2007 WL 2253509, at *6 (M.D. Pa. Aug. 3, 2007); Sherman v. John Brown Ins. Agency, Inc.,
38 F. Supp. 3d 658, 664 (W.D. Pa. 2014). The Court finds the analysis and rationale articulated by
these two opinions to be particularly thorough and persuasive as to the effect of Rule 1042.1.
In Hults, the defendant—a limited liability partnership that designed, inspected, installed,
and repaired septic systems—moved for summary judgment with respect to, among other claims,
a professional negligence claim. Hults, 2007 WL 2253509, at *1-*3. The defendant argued that it
cannot be subject to a professional negligence claim because it is “an unlicensed service provider”
that does not fall within the “traditionally recognized and specifically enumerated licensed

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professionals” of Rule 1042.1. Id. at *6.

Judge Mannion did not agree with the defendant’s

assessment. Id.
For the purposes of the present case, the Hults court made two key observations. First,
the court looked at the actual text of Rule 1042.1 and concluded:
Upon review, the scope of Pa.R.C.P. 1042.1 provides that “[t]he rules of this
chapter govern a civil action in which a professional liability claim is asserted
against a licensed professional.” It does not provide that a professional negligence
claim cannot be maintained against an individual not enumerated in that Rule, but
only that the Rule will be applied in those cases where a professional liability claim
is asserted against one of the licensed professionals listed.
Id. Second, the Hults court reviewed Section 299A of the Restatement (Second) of Torts
and noted:
[T]he list of “professions” contained in § 299A are the same as those enumerated
in Pa.R.C.P. 1042.1. However, § 299A also applies to certain “skilled trades,”
which are noted to include airplane pilots, precision machinists, electricians,
carpenters, blacksmiths, and plumbers. With the exception of airplane pilots, who
are regulated and licensed under federal law, the remaining “skilled trades” are
not required to be licensed under Pennsylvania state law. See Purdon's
Pennsylvania Statutes and Consolidated Statutes Annotated, Title 63, Professions
and Occupations (State Licensed). In fact, the requirements of each of the skilled
trades are regulated by municipal law, which may or may not require licensing.
Therefore, the court finds that it is not necessary that [the defendant] be licensed
in order to be subject to a claim based upon § 299A. Section § 299A simply
provides the standard duty of care applicable in a business setting.
Id. The Court agrees with these conclusions and the accompanying analysis by the Hults court.
In Sherman, a building contractor filed, among other claims, a professional negligence
claim against insurance agencies and their employees. Sherman, 38 F. Supp. 3d at 660. The
defendants moved to dismiss on the exact same theory raised by CBIZ in the present case.
Namely, the defendants asserted that Rule 1042.1 is an exclusive list of enumerated professionals

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against whom professional liability actions may be initiated and, because insurance agencies and
brokers are not on the list, the plaintiff’s claim is not cognizable. Id. at 663.
Judge Cohill, citing Pressley and Rapidigm, concluded that Rule 1042.1 “only imposes the
requirement of obtaining a certificate of merit when bringing a professional liability claim against
one of the professional listed under the rule” and does not speak to a plaintiff’s ability to bring a
professional negligence claim in accordance with Restatement (Second) of Torts §299A. Id. Judge
Cohill denied the defendant’s motion to dismiss and directly stated, “[I]nsurance brokers or
agents not being listed under Rule 1042 is not dispositive of Plaintiff’s ability to bring a
professional negligence claim against Defendants.”

Id.

The Court agrees with Sherman’s

reasoning and conclusion. 13
iii. Rule 1042.1 is a Procedural Rule
Hults and Sherman, unlike all of the contrary decisions, persuasively conclude that Rule
1042.1 is a procedural rule that requires certain procedures to be followed when filing a
professional negligence claim against the listed profession. See Hults, 2007 WL 2253509, at *6;
Sherman, 38 F. Supp. 3d at 663. As discussed supra, the Court agrees with this conclusion and the
accompanying rationale, but the Court also offers a few additional reasons beyond those offered

The Court also recognizes Chief Judge Conti’s decisions rejecting the validity of a professional negligence
claim brought against non-engineers who installed a sprinkler system. Ins. Co. of Greater N.Y. v. Fire Fighters
Sales & Servs. Co., 93 Fed. R. Serv. 3d 638 (W.D. Pa. 2015); Ins. Co. of Greater N.Y. v. Fire Fighter Sales & Servs.
Co., 120 F. Supp. 3d 449 (W.D. Pa. 2015). These two opinions do not address Rule 1042.1, instead focusing
on the gist of the action doctrine and on the factual issue of whether a professional engineer was involved
or was required by law to be involved in the design or installation of the sprinkler system. These opinions
cite favorably to Sherman, Hult, and Rapidigm. See Ins. Co., 93 Fed. R. Serv. 3d at 397-98; Ins. Co., 120 F. Supp.
3d at 462-63.
13

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by Hults and Sherman to show that Rule 1042.1 does not substantively bar claims by those
professions not included with its thirteen-profession list.
First, the language and context of Rule 1042.1 prompts this conclusion. Rule 1042.1,
appropriately entitled “Professional Liability Actions. Scope. Definition,” defines terms and
establishes the scope of the chapter’s rules regarding professional liability claims. Pa. R. Civ. P.
No. 1042.1(a). The list of thirteen professions within Rule 1024.1 is a basic scope and definition
provision; it details those professions to which the remaining rules in the chapter apply. See Pa.
R. Civ. P. No. 1042.1(c) (“As used in this chapter, ‘licensed professional’ means…”). Nothing in
the text of the Rule states that it is an exhaustive list, nor does the Rule indicate or imply that it
acts as a substantive bar to professional negligence claims for “unlisted” professions. Moreover,
the provisions within the Pennsylvania Rules of Civil Procedure that follow Rule 1042.1 and use
the definitions provided therein are unmistakably procedural requirements. See Pa. R. Civ. P.
No. 1042.2 (requiring that complaints identify each defendant in a professional liability claim and
providing a suggested template for complaints); Pa. R. Civ. P. No. 1042.3 (requiring that a
certificate of merit be filed within 60 days of the filing of the complaint); Pa. R. Civ. P. No. 1042.4
(requiring that responsive pleadings be filed according to Rule 1026 or within 20 days after service
of the certificate of merit, whichever is later); Pa. R. Civ. P. No. 1042.5 (stating that discovery
cannot be sought prior to the filing of the certificate of merit without leave of court); Pa. R. Civ.
P. No. 1042.6-1042.7 (providing non pros procedures in the event that a certificate of merit is not
filed); Pa. R. Civ. P. No. 1042.8 (allowing for 20 days to file a corrected certificate of merit in the
event of noncompliance); Pa. R. Civ. P. No. 1042.9 (providing for sanctions for noncompliance);
Pa. R. Civ. P. No. 1042.10-1042.12 (providing suggested forms for the certificate of merit, non pros

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filings, and non pros judgments). All of these provisions to which the definitions established in
Rule 1042.1 apply are clearly procedural in nature. 14
Furthermore, the Court also recognizes the broader context of Rule 1042.1 as a rule within
the Pennsylvania Rules of Civil Procedure. While such a label is not determinative, the Court
considers this context to be a relevant consideration. This categorization is particularly relevant
because, contrary to CBIZ’s claim, 15 the Pennsylvania Supreme Court—with the assistance and
advice of the Civil Procedural Rules Committee established by the Pennsylvania Supreme
Court—promulgates the Pennsylvania Rules of Civil Procedure. See Pa. Const. art. 5, § 10
(establishing the Pennsylvania Supreme Court’s rule-making authority); 42 Pa. Cons. Stat. § 1722;
Womer, 908 A.2d at 275-76 (stating that “we,” i.e., the Pennsylvania Supreme Court, adopted
Rules 1042.1-1042.8 in accordance with the court’s rule-making authority). Given that the Court’s
task is to predict how the Pennsylvania Supreme Court would decide the present issue, the
Pennsylvania Supreme Court’s categorization of a rule as procedural bears some weight.
Consequently, the language and context of Rule 1042.1 makes the procedural nature of Rule
1042.1’s thirteen-profession list evident to the Court.
Second, a recent decision by the Pennsylvania Supreme Court strongly prompts the
Court’s conclusion as to Rule 1042.1. In Bruno v. Erie Insurance Company, the plaintiffs filed a
professional negligence claim against engineers hired by Erie Insurance Company for allegedly

The Pennsylvania Supreme Court discussed the origins and purpose of this set of rules in a 2006 decision.
See Womer, 908 A.2d at 275-76. The court made it clear that the primary purpose of the court’s promulgation
of these rules was to require a certificate of merit in hopes of creating an orderly procedure to dispose of
non-meritorious professional liability claims early in the life the case. Id.
15 CBIZ’s Reply in Support of Their Motion to Dismiss argues that the Court should “accept the legislature’s
judgment as to which professions are subject to tort claims for economic damages” as represented in Rule
1042.1 and should “trust the legislature’s judgment over Altoona’s.” (ECF No. 32 at 2-3) (emphasis added).
14

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representing that mold in the plaintiffs’ home was harmless. 16 Bruno v. Erie Ins. Co., 106 A.3d 48,
50, 71-72 (Pa. 2014). The defendants argued that, because the plaintiffs did not file a certificate of
merit as provided for by Rule 1042.3, the plaintiffs claim must be dismissed. Id. To resolve this
dispute, the Pennsylvania Supreme Court delved into a thorough analysis of Rule 1042.1 and
Rule 1042.3. Id. The Bruno court eventually concludes that the certificate of merit need not have
been filed because the plaintiffs were not patients or clients of the engineers (because Erie
Insurance Company hired the engineers) and that Rule 1042.1 limits the requirement of filing a
certificate of merit to only those professional liability claims which are asserted “by or on behalf
of a patient or client of the licensed professional.” Id. (citing Pa. R. Civ. P. No. 1042.1).
While this specific holding is of little importance to the present case, Bruno offers
important guidance on Rule 1042.1 through its result and discussion. As an initial matter, the
language of Bruno makes it clear that the Pennsylvania Supreme Court views Rule 1042.1 as a
procedural rule, not a rule with substantive force to bar claims. See id.
More importantly, the Bruno court established that professional negligence claims can
proceed even if they fall outside of the scope of Rule 1042.1. Rule 1042.1 begins by stating: “The
rules of this chapter govern a civil action in which a professional liability claim is asserted by or
on behalf of a patient or client of the licensed professional against.” Pa. R. Civ. P. No. 1042.1(a)
(footnote omitted). The claim in Bruno fell outside of the scope of this provision because the
plaintiffs were not, as required by Rule 1042.1(a), patients or clients of the engineer. See Bruno,
106 A.2d at 70-71. Nevertheless, the Pennsylvania Supreme Court allowed the claim to proceed.

16

Engineers are on the Rule 1042.1 list. See Pa. R. Civ. P. No. 1042.1(c)(vi).

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Id. This suggests that, under Pennsylvania law, professional negligence claims that fall outside
the scope of Rule 1042.1—such as professional negligence claims brought by non-patients/nonclients or against “unlisted” professions—are not barred simply because they do not fit within
the scope of these procedural rules. 17
4. Actuaries, Including CBIZ, Constitute a Profession Subject to Professional
Negligence Claims Under Pennsylvania Common Law
Now that the Court has established that Rule 1042.1 is not a preclusive list, the Court must
assess whether actuaries are professionals subject to professional negligence claims under the
operative common law. All of the cases cited supra that went beyond Rule 1042.1 looked to
Restatement (Second) of Torts § 299A (Am. Law. Inst. 1965) (“Section 299A”) for guidance as to
those jobs that constitute a “profession” for the purposes of professional liability claims. See, e.g.,
Pressley, 817 A.2d at 1138; Wisniski, 852 A.2d at 1212; Sherman, 38 F. Supp. 3d at 664-65; Hults, 2007
WL 2253509, at *6. The Court will do likewise and concludes that an actuary, including CBIZ,
constitutes a professional for the purposes of a professional negligence claim.
Section 299A reads:
Unless he represents that he has greater or less skill or knowledge, one who
undertakes to render services in the practice of a profession or trade is required to
exercise the skill and knowledge normally possessed by members of that
profession or trade in good standing in similar communities.
In CBIZ’s Reply in Support of Their Motion to Dismiss, CBIZ, without citation, asserts that the
“exhaustive list” interpretation of Rule 1042.1 is the majority view. (ECF No. 32 at 2-3.) CBIZ also argues
that this so-called majority view promotes good public policy by furthering contracts as guarantees of
sufficient performance and is better law. (Id.) The Courts’ research found a lack of consensus in case law
on this issue; however, as the cases cited above suggest, if anything, CBIZ’s position would appear to be
the minority view. As for considerations of public policy, the Court relies on its interpretation of the
language of Rule 1042.1 and the guidance of the case law cited above. However, the Court fails to see how
allowing actuaries to be immune from negligence suits is good policy, especially given that accountants
and other similar professions with similarly complex responsibilities are subject to professional negligence
claims and must adhere to professional standards of care.
17

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Restatement (Second) of Torts § 299A. This test establishes the standard of care that applies to
professionals. More important here, Comment b to Section 299A provides:
b. Profession or trade. This Section is thus a special application of the rule stated in
§ 299. It applies to any person who undertakes to render services to another in the
practice of a profession, such as that of physician or surgeon, dentist, pharmacist,
oculist, attorney, accountant, or engineer. It applies also to any person who
undertakes to render services to others in the practice of a skilled trade, such as
that of airplane pilot, precision machinist, electrician, carpenter, blacksmith, or
plumber. This Section states the minimum skill and knowledge which the actor
undertakes to exercise, and therefore to have. If he has in fact greater skill than
that common to the profession or trade, he is required to exercise that skill, as
stated in § 299, Comment e.
Id. § 299A cmt. b.
Clearly, an actuary falls within the scope of this rule due to the specialized skill, education,
and certification/licensure of the profession. The Complaint unequivocally alleges the complexity
and expertise required to be an actuary; the specialized skill, education, and certification
possessed by Ketzner; and the existence of professional standards of competence and care within
the actuarial profession. (ECF No.1 ¶ 7) (stating that Ketzner is an Enrolled Actuary, a Member
of the American Academy of Actuaries, a Fellow of the Conference of Consulting Actuaries, and
a Member of the American Society of Pension Professional and Actuaries’ College of Pension
Actuaries who is bound to follow and uphold actuarial standards of professional conduct and
competence). The U.S. Supreme Court, albeit in a substantially different context, has discussed
the expertise required to be an actuary and the difficulty and importance of their calculations.
Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Trust for S. Cal., 508 U.S. 602, 632 (1993).
The U.S. Supreme Court went so far as to directly state that “actuaries are trained professionals
subject to regulatory standards.” Id. (citing 29 U.S.C. §§ 1241, 1242; 26 U.S.C. § 7701(a) (35)).

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Even in the five federal cases discussed supra Part VI.B.3.ii.a that viewed Rule 1042.1 as an
exhaustive list with substantive effect, the professions in all but one of these cases varied
significantly from an actuary. See Gilmour, 2005 WL 241181, at *16 (claim against provider of asset
advice was dismissed); Am. Inv’rs, 2007 WL 2541216, at *32 (claim against attorney was not
dismissed); Greenwood, 2011 WL 33027, at *4 (claim against real estate property manager was
dismissed); Hatten, 2014 WL 5473571, at *8 (claim against correctional officer was dismissed).
Hirsch dismissed a professional liability claim against an insurance broker—the only one of these
five federal cases to dismiss a claim against a defendant with some form of licensure. See Hirsch,
2011 WL 1166127, at *4. However, the Court finds it significant that, in contrast, the Pennsylvania
Superior Court has twice allowed professional liability claims to proceed against insurance
agents, see Pressley, 817 A.2d at 1138; Wisniski, 852 A.2d at 1212, and the Sherman court allowed a
professional negligence claim to proceed against an insurance broker, Sherman, 38 F. Supp. 3d at
664-65.
From a functional approach, actuarial services and auditing services performed by
accountants have been held to be professional services subject to professional negligence claims.
See Koken v. Steinberg, 825 A.2d 723, 725 (Pa. 2003) (allowing a professional negligence claim
against an accounting firm that was performing actuarial and auditing services to proceed); 18

UPMC’s Brief in Opposition to Defendants’ Motion to Dismiss asserts that Koken v. Steinberg, 825 A.2d
723 (Pa. 2003) allowed “a claim for professional negligence in the performance of actuarial services to
proceed.” (ECF No. 29 at 13.) This statement is true, but, without clarification, it overstates this case’s
significance. In Koken, the defendant was Deloitte & Touched, L.L.P.—a defendant that does not pose even
a potential conflict with Rule 1042.1 because accountants are one of the thirteen professions listed in Rule
1042.1. Koken, 825 A.2d at 725. Accordingly, the Pennsylvania Supreme Court never cited to Rule 1042.1
or discussed Rule 1042.1’s potential role as a substantive and exhaustive list. Instead, the issue in Koken
was whether professional negligence and other claims could be brought against Deloitte by the Insurance
Commissioner of the Commonwealth of Pennsylvania on behalf of the policyholders and creditors despite
18

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Tekman v. Berkowitz, 639 F. App’x 801, 804 (3d Cir. 2016) (same); Avangard Financial Group, Inc. v.
Raich Ende Malter & Co., LLP, 2015 WL 1808549 (E.D. Pa. Apr. 17, 2015) (same); see also I.B.E.W.,
2008 WL 269476, at *6 (allowing a professional negligence claim to proceed against an actuary
and his employer, albeit without the “professional” nature of actuaries being raised or
considered). Although accountants are on the Rule 1024.1 list, limiting the import of these cases,
Koken, Tekman, and Avangard still stand for the proposition that actuaries perform “professional”
tasks comparable to those performed by the “professional” job of an accountant.
Looking at the theory underlying professional negligence actions, the Rapidigm court
concluded:
The apparent purpose of professional negligence actions is to provide protection
to those service providers who are not likely to be guaranteeing the outcome of
their services. Ordinarily, the lawyer, the physician, and the accountant are not
guaranteeing a result that can be described in a contract. Instead, they are
agreeing to exercise skill and knowledge normally possessed by members of the
profession in an effort to achieve goals for the clients that cannot be guaranteed.
The expert testimony at trial is not based on whether or not the goals were
achieved but rather whether appropriate skill and knowledge was exercised.
Rapidigm, 63 Pa. D. & C.4th at 243. Applying this “contractual sufficiency” approach, the Court
views contract law as insufficient protection for those relying on the services of actuaries.
Reviewing the many cases from other jurisdictions cited by Rapidigm, see id. at 244-47, the Court
notes that the level of formal training, expertise, trust, and professional standards of conduct of
actuaries aligns very closely with that of accountants and other such professions.

the Insurance Commissioner not being in privity with Deloitte. Id. at 726. The Pennsylvania Supreme
Court allowed this claim to proceed because Article V of the Insurance Department Act specifically allows
an insurance regulator to represent the interests of policyholders and creditors. See id. (citing 40 P.S. §§
221.1-221.63). Therefore, Koken has some significance in demonstrating that actuarial services are
professional in nature, but Koken cannot fairly be taken to mean that the Pennsylvania Supreme Court held
that professional negligence claims may be brought against professions not listed in Rule 1042.1.

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In regard to the Rapidigm court’s view that “[c]ontract law provides sufficient protection
to customers/clients of service providers whose services are capable of being evaluated through
the guarantee of a defined outcome,” id., the Court generally agrees. However, this “outcomeguarantee” approach should not be overstated. The “outcome” of a professional’s services is
certainly evidence of whether that professional adhered to professional standards. For example,
a fatality following a routine surgery or a dismissal with prejudice of a meritorious cause of action
would be relevant evidence of a surgeon or an attorney’s negligence or demonstrate the harm
suffered by the plaintiff. The “outcome” of an inaccurate accounting, audit, tax calculation, or
financial plan performed by a certified public accountant would be evidence of whether that
accountant adhered to professional standards because such a flawed “outcome” would generally
be unexpected if professional norms were followed. The evidentiary value of a “bad” outcome
does not mean that a professional negligence claim against an actuary is “capable of being
evaluated through the guarantee of a defined outcome.” See id.
No decisions located by the parties or the Court have questioned whether accountants are
“professionals” subject to professional negligence claims. The Court does not believe that
contract law adequately protects those who use the services of actuaries any more than it does for
the clients of accountants. Likewise, the Court does not believe that actuarial services are
“capable of being evaluated through the guarantee of a defined outcome,” id., any more than the
services of accountants, doctors, or attorneys. Just like accountants and members of other
professions, actuaries must adhere to professional standards by exercising the skill and
knowledge normally possessed by members of a profession in performing their services. The key

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is not whether certain outcomes or goals were achieved, but whether the actuary complied with
the professional standard of care and caused harm because of the failure to do so.
In sum, under Section 299A and the most germane case law, the Court finds that actuaries
are “professionals” for the purpose of a professional negligence action under Pennsylvania law.
Because the Complaint sufficiently alleges that Ketzner is an actuary who negligently performed
work within the scope of that profession, the Court denies CBIZ’s motion to dismiss Count 1 of
the Complaint.
C.

Count 3 Will Not Be Dismissed for Failure to Allege Duty and Justifiable
Reliance
1. Overview

CBIZ argues that UPMC’s claim of negligent misrepresentation in Count 3 should be
dismissed under the economic loss doctrine. (ECF No. 13 at 9.)
The economic loss doctrine “provides that no cause of action exists for negligence that
results solely in economic damages unaccompanied by physical or property damage.” Brand
Mktg. Grp. LLC v. Intertek Testing Servs., 801 F.3d 347, 354 (3d Cir. 2015) (quoting Adams v. Copper
Beach Townhome Cmtys., L.P., 816 A.2d 301, 305 (Pa. Super. Ct. 2003)). Notwithstanding this
general rule, the Pennsylvania Supreme Court has recognized an exception specifically for
negligent misrepresentation claims. See Bilt-Rite Contractors, Inc. v. Architectural Studio, 866 A.2d
270 (Pa. 2005). In Bilt-Rite, the court expressly adopted the Restatement (Second) of Torts § 552
(Am. Law. Inst. 1977) (“Section 552”). Bilt-Rite, 866 A.2d at 287. Section 552 provides:
(1) One who, in the course of his business . . . supplies false information for the
guidance of others in their business transactions, is subject to liability for
pecuniary loss caused to them by their justifiable reliance upon the

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information, if he fails to exercise reasonable care or competence in obtaining
or communicating the information.
(2) [This liability] is limited to loss suffered
(a) by the person or one of a limited group of persons for whose benefit
and guidance he intends to supply the information or knows that the
recipient intends to supply it; and
(b) through reliance upon it in a transaction that he intends the
information to influence or knows that the recipient so intends or in a
substantially similar transaction.
Restatement (Second) of Torts § 552.
CBIZ acknowledges this Bilt-Rite exception to the economic loss doctrine, but asserts that
UPMC has failed to satisfy any of the elements to this “narrowly restricted” exception. (ECF No.
13 at 9.) In particular, CBIZ believes that UPMC has failed to allege that CBIZ owed a duty to
UPMC and that CBIZ failed to allege justifiable reliance. The Court, however, disagrees because
the Complaint adequately alleges facts to satisfy all of the elements necessary to sustain a
negligent misrepresentation claim falling under the exception to the economic loss doctrine.
2. Duty
i.

The Parties’ Arguments

UPMC—not Altoona—asserts Count 3 against CBIZ. Therefore, because the Complaint
does not allege that UPMC was in privity with CBIZ at the time of the alleged negligent
misrepresentation, CBIZ argues that UPMC is a third party to which CBIZ did not owe a duty, as
required by Section 552. (ECF No. 13 at 10.)
The parties do not disagree that CBIZ must owe a duty to UPMC in order for UPMC to
succeed on a negligent misrepresentation claim. However, the parties’ briefs extensively disagree

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as to what is required to establish a duty and whether the Complaint’s allegations meet the
relevant standard. (ECF No. 13 at 10-16; ECF No. 29 at 16-18; ECF No. 32 at 4-10; ECF No. 45 at
2-4; ECF No. 46 at 1-4.) To summarize the parties’ lengthy arguments on this matter, CBIZ
interprets Bilt-Rite and Section 552 to require that a complaint allege that a professional-defendant
had “actual knowledge”/“manifest awareness” of reliance by the third-party plaintiff on the
information provided by the professional-defendant. (ECF No. 13 at 10-16; ECF No. 32 at 4-10;
ECF No. 46 at 1-4.) UPMC, on the other hand, argues that a lesser standard applies under which
“liability is imposed under § 552(2) upon an information supplier like CBIZ to anyone in a
foreseeable class of persons, whose reliance upon the information supplied is also foreseeable.”
(ECF No. 29 at 14.) The proper standard lies somewhere in between these two interpretations,
albeit likely closer to CBIZ’s formulation.
ii. The Restatement’s Standard and its Application to the Present Case
The appropriate standard is addressed by Section 552(2) and Comment h to Section 552.
See Bilt-Rite, 866 A.2d at 275 (quoting Comment h). Section 552(2)(a) makes it clear that a plaintiff
in a negligent misrepresentation case must be a “person or one of a limited group of persons for
whose benefit and guidance [the defendant] intends to supply the information or knows that the
recipient intends to supply it.” Restatement (Second) of Torts § 552(2)(a). The Complaint’s
allegations satisfy this requirement.
On this point, the Complaint alleges that:
(1) “[U]pon information and belief, CBIZ and Ketzner . . . were aware of Altoona’s
financial position and were further aware that Altoona was looking for a
financial partner, such as UPMC.” (ECF No. 1 ¶ 37.)

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(2) “Upon information and belief, both before and during the due diligence
period, defendants were aware that UPMC, or other entities focused on a
transaction with Altoona, would rely and did rely on CBIZ’s GAAP
Valuations.” (Id. ¶ 50.)
(3) “Defendants knew that UPMC relied on the actuarial valuation report
prepared for the plan year ending June 30, 2012, certified as accurate by
Defendant Ketzner on September 17, 2012, before the Altoona acquisition, in
evaluating the Altoona Plans’ benefit obligations and liabilities.” (Id. ¶ 28.)
CBIZ disputes that these are sufficient allegations by arguing that they are mere
conclusory allegations and points out that the Complaint, dealing in nothing more than rumors,
refers to the “word on the street” being that Altoona was interested in being acquired and would
be “doing something with somebody.” 19 (ECF No. 1 ¶ 38.) However, the totality of the allegations
in the Complaint and the reasonable inferences therefrom sufficiently state that CBIZ knew that
Altoona was seeking to be acquired by UPMC or another similarly positioned entity and that
Altoona would give CBIZ’s reports to UPMC or another similarly positioned entity to assess
Altoona’s pension liabilities in the acquisition process.
At the motion-to-dismiss stage, the Court must accept all factual allegations in the
Complaint and draw all inferences from the alleged facts in the light most favorable to the nonmoving party. Phillips v. County of Allegheny, 515 F.3d 224, 228 (3d Cir. 2008) (citing Worldcom,

The Court notes that the Complaint’s allegation that Ketzner was the “lead and sole actuary” for
Altoona’s Plans for at least 13 years (ECF No. 1 ¶ 7) leads to the reasonable inference that UPMC’s
allegations of CBIZ and Ketzner’s awareness have more basis than simply “word on the street” and are
more than mere conclusory allegations.

19

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Inc. v. Graphnet, Inc., 343 F.3d 651, 653 (3d Cir. 2003)). Here, although the Complaint may
reference “word on the street” and might theoretically fail under some higher standard of
pleading, the Complaint nevertheless presents sufficient factual content for the Court to draw the
reasonable inference that UPMC was a “person or one of a limited group of persons for whose
benefit and guidance [the defendant] intends to supply the information or knows that the
recipient intends to supply it.” Restatement (Second) of Torts § 552(2)(a).
Comment h to Section 552 further confirms this conclusion. Comment h discusses this
issue at great length. 20 Most relevant here, Comment h makes it clear that CBIZ need not have

20

In its entirety, Comment h reads:
h. Persons for whose guidance the information is supplied. The rule stated in this Section
subjects the negligent supplier of misinformation to liability only to those persons for
whose benefit and guidance it is supplied. In this particular his liability is somewhat more
narrowly restricted than that of the maker of a fraudulent representation (see § 531), which
extends to any person whom the maker of the representation has reason to expect to act in
reliance upon it.
Under this Section, as in the case of the fraudulent misrepresentation (see § 531), it is not
necessary that the maker should have any particular person in mind as the intended, or
even the probable, recipient of the information. In other words, it is not required that the
person who is to become the plaintiff be identified or known to the defendant as an
individual when the information is supplied. It is enough that the maker of the
representation intends it to reach and influence either a particular person or persons,
known to him, or a group or class of persons, distinct from the much larger class who
might reasonably be expected sooner or later to have access to the information and
foreseeably to take some action in reliance upon it. It is enough, likewise, that the maker
of the representation knows that his recipient intends to transmit the information to a
similar person, persons or group. It is sufficient, in other words, insofar as the plaintiff's
identity is concerned, that the maker supplies the information for repetition to a certain
group or class of persons and that the plaintiff proves to be one of them, even though the
maker never had heard of him by name when the information was given. It is not enough
that the maker merely knows of the ever-present possibility of repetition to anyone, and
the possibility of action in reliance upon it, on the part of anyone to whom it may be
repeated.
Even when the maker is informed of the identity of a definite person to whom the recipient
intends to transmit the information, the circumstances may justify a finding that the name
and identity of that person was regarded by the maker, and by the recipient, as important

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known that UPMC was the intended or probable recipient of CBIZ’s report. Id. § 552 cmt. h.
Knowledge that Altoona sought an acquisition partner and intended to provide CBIZ’s report to
that partner is clearly sufficient. As just shown via quotation, the Complaint adequately alleges
such knowledge.
iii. “Actual Knowledge” vs. “Reasonable Foreseeability”
The heart of the parties’ dispute, at least in their early briefs, is whether Pennsylvania law
uses an “actual knowledge” standard or “reasonable foreseeability” standard to gauge the
existence of duty for the purposes of a third-party negligent misrepresentation claim. Supporting
UPMC’s reasonable foreseeability argument to some extent, the Pennsylvania Supreme Court
once-summarized, without correction, a lower court’s discussion of Bilt-Rite by writing that the
Bilt-Rite court “recognized that [a professional] may be found professionally liable to third parties
when it is foreseeable that the information [the professional] provide[s] to a client will be used

only because the person in question was one of a group whom the information was
intended to reach and for whose guidance it was being supplied. In many situations the
identity of the person for whose guidance the information is supplied is of no moment to
the person who supplies it, although the number and character of the persons to be reached
and influenced, and the nature and extent of the transaction for which guidance is
furnished may be vitally important. This is true because the risk of liability to which the
supplier subjects himself by undertaking to give the information, while it may not be
affected by the identity of the person for whose guidance the information is given, is vitally
affected by the number and character of the persons, and particularly the nature and extent
of the proposed transaction. On the other hand, the circumstances may frequently show
that the identity of the person for whose guidance the information is given is regarded by
the person supplying it, and by the recipient, as important and material; and therefore the
person giving the information understands that his liability is to be restricted to the named
person and to him only. Thus when the information is procured for transmission to a
named or otherwise described person, whether the maker is liable to another, to whom in
substitution the information is transmitted in order to influence his conduct in an
otherwise identical transaction, depends upon whether it is understood between the one
giving the information and the one bringing about its transmission, that it is to be given to
the named individual and to him only.
Restatement (Second) of Torts § 552 cmt. h.

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and relied on by the third party.” Bruno, 106 A.3d at 55 (citing Bilt-Rite, 866 A.2d at 286). If taken
as a pronouncement of applicable law going forward, rather than passing dictum summarizing a
lower court’s soon-to-be-reversed opinion, this remark by the Bruno court would likely be an
articulation of a lower and broader standard than that given by Section 552 and by Bilt-Rite itself. 21
However, this potential deviation from Section 552 and Bilt-Rite in Bruno is of little consequence
in the present case.
Even if the Court fully endorsed CBIZ’s “actual knowledge” standard, the Complaint’s
allegations are sufficient under this higher standard because the Complaint alleges that CBIZ was
aware that Altoona sought an acquisition partner, like UPMC, and that UPMC or an equivalent
entity would and did rely on CBIZ’s reports. (ECF No. ¶¶ 28, 37, 50.) The Complaint’s
articulation of CBIZ’s knowledge is not perfect, but it is sufficient under federal pleading
standards. Additionally, at least based on the potential implication of Bruno, the Pennsylvania
Supreme Court may view its own pronouncements in Bilt-Rite to mean “that [a professional] may
be found professionally liable to third parties when it is foreseeable that the information [the
professional] provide[s] to a client will be used and relied on by the third party.” Bruno, 106 A.3d
at 55 (citing Bilt-Rite, 866 A.2d at 286). The Complaint’s allegations also satisfy this lower
standard.

The Court observes that language in Bilt-Rite could arguably be construed to promote a reasonable
foreseeability standard. In adopting Section 552, the Pennsylvania Supreme Court explained:
Accordingly, we hereby adopt Section 552 as the law in Pennsylvania in cases where
information is negligently supplied by one in the business of supplying information, such
as an architect or design professional, and where it is foreseeable that the information will
be used and relied upon by third persons, even if the third parties have no direct
contractual relationship with the supplier of information.
Bilt-Rite, 866 A.2d at 287 (emphasis added). Yet, Section 552 and the entirety of Bilt-Rite does not overtly
endorse a reasonable foreseeability approach as to the existence of a professional’s duty to third parties.
21

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Regardless of potential ambiguity in the exact parameters and outer limits of Bilt-Rite and
Section 552, a comparison of the allegations made in the complaint in Bilt-Rite—which the
Pennsylvania Supreme Court held to be sufficient—to the allegations of UPMC’s Complaint in
the present case leaves little doubt as to whether the Complaint satisfies Pennsylvania’s
substantive law regarding the duty required for a negligent misrepresentation claim. In the
second-to-last paragraph of Bilt-Rite, the Pennsylvania Supreme Court wrote:
Accepting the allegations in Bilt–Rite’s complaint as true for purposes of the
demurrer, TAS provided plans and specifications for the school project to the
school district with full knowledge that those plans and specifications would be
included in a bid package supplied to prospective bidders, and relied upon by
those bidders. Bilt–Rite received the plans from the school district and, according
to its complaint, relied upon them in calculating its bid, suffering economic
damage as a result of alleged misrepresentations in the plans. This case falls
precisely within the framework of Section 552, and therefore, it is cognizable under
Pennsylvania law.
Bilt-Rite, 866 A.2d at 288. Likewise, accepting the allegations of UPMC’s Complaint as true for
the purposes CBIZ’s Motion to Dismiss, CBIZ provided its valuations and reports on the pension
plans to Altoona with knowledge that UPMC or a similarly positioned entity would be provided
with its valuations and reports and rely upon them in the acquisition process.22 The Complaint
may not perfectly present the source of CBIZ’s knowledge or a clear timeline of when CBIZ
acquired this knowledge, but, when all reasonable inferences from the alleged facts are made in
the light most favorable to UPMC, see Phillips, 515 F.3d at 338, the Complaint sufficiently alleges
duty under Bilt-Rite.

The Court also notes that, unlike in Bilt-Rite where Pennsylvania’s fact pleading standard applied, the
less stringent, federal notice pleading standard as clarified in Twombly and Iqbal applies in the present case.
22

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3. Justifiable Reliance
i.

CBIZ’s Argument and the Basic Standard for Justifiable Reliance

CBIZ next argues that a negligent misrepresentation claim requires “justifiable reliance”
and that UPMC has failed to allege that it was reasonable for UPMC to rely on CBIZ’s report for
the purposes of acquiring Altoona. (ECF No. 13 at 16.) In support of this argument, CBIZ
contends that a so-called “disclaimer” on its report made it unreasonable for UPMC to rely on its
report and that the Complaint failed to allege “specific facts demonstrating that [UPMC]
exercised the due diligence that a reasonable person under all the circumstances would have
exercised to protects [its] interests.” (ECF No. 13 at 18.)
The Court agrees that Pennsylvania law requires that UPMC allege that it acted in
justifiable reliance upon CBIZ’s misrepresentation. See Bilt-Rite, 866 A.2d 270, 273 n.1; Bortz v.
Noon, 729 A.2d 555, 561 (Pa. 1999); Luther v. Kia Motors America, Inc., 676 F. Supp. 2d 408, 418-19
(W.D. Pa. 2009). The Court also agrees that, to be “justifiable,” reliance upon the representation
of another must be reasonable. See Porreco v. Porreco, 811 A.2d 566, 570 (Pa. 2002) (citing In re
Allegheny Int’l, Inc., 954 F.2d 167, 178 (3d Cir. 1992)). However, the Court disagrees with CBIZ’s
claim that the Complaint’s allegations fail to meet this standard for justifiable reliance.
ii. Application of this Standard to the Allegations of the Complaint
The Complaint clearly alleges that UPMC relied on CBIZ’s report—a report that CBIZ
certified as a full and fair disclosure of the pension plans’ actuarial position that was prepared
using reasonable methods and assumptions. (ECF No. ¶¶ 27, 28, 50.) The Complaint also clearly
alleges the extensive credentials of Ketzner, that Ketzner had performed actuarial services on
Altoona’s pension plans for at least 13 years, and that CBIZ represented itself as experienced,

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qualified, and capable of providing the requested actuarial services and valuations. (Id. ¶¶ 7, 22,
24.) With these allegations, the Complaint easily and directly establishes that UPMC relied on
the accuracy of the report in its acquisition of Altoona and that such reliance was reasonable
because of CBIZ and Ketzner’s expertise, experience, and assurances to Altoona.
Additionally, in deciding whether reliance on an alleged misrepresentation is justified,
the Pennsylvania Supreme Court puts particular weight on whether the recipient knew or should
have known that information supplied was false. Porreco, 811 A.2d at 570 (citing Scaife Co. v.
Rockwell-Standard Corp., 285 A.2d 451 (Pa. 1971)). The Complaint specifically addresses this
consideration, alleging that CBIZ did not disclose Ketzner’s underlying mistaken assumptions
until March 2015 and that “[n]either Altoona nor UPMC could have discovered the errors because
those errors were the result of erroneous assumptions and methodologies undisclosed in the
GAAP and Funding Reports prepared by Defendants.” (ECF No. 1 ¶¶ 31-32.) These allegations
demonstrate that UPMC neither knew nor should have known that CBIZ’s reports were
inaccurate.
In essence, the Complaints alleges that UPMC relied on reports authored by an
experienced and well-credentialed actuary who had worked for Altoona, seemingly without
issue, for at least 13 years and who was employed by a large professional services corporation
with numerous subsidiaries—all of which represented themselves as experienced, qualified, and
capable in the actuarial valuation of pension benefit plans and neither of which gave any
indication that the reports were inaccurate, untrustworthy, or based on mistaken underlying
assumptions. (See ECF No. 1 ¶¶ 4-5, 7, 10, 22, 24, 27-28, 50.) Despite CBIZ, perhaps somewhat
surprisingly, arguing that it was unjustifiable and unreasonable as a matter of law for UPMC to

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rely on CBIZ’s own work product, the Court easily holds that the Complaint adequately alleges
that UPMC relied on the report and that such reliance was justifiable and reasonable.
iii. The “Disclaimer”
In an effort to detract from the reasonableness of UPMC’s reliance on CBIZ’s report, CBIZ
attempts to construe a purported notation on the first page of the report that “CBIZ had prepared
the Report ‘for the purposes of fulfilling the employer [Altoona] financial accounting
requirements’” as a disclaimer. (ECF 13 at 17.) CBIZ argues that, under the Restatement and
assorted case law, this notation qualifies as a disclaimer, making it unreasonable as a matter of
law to rely on the report for anything other than the report’s specifically stated purpose. (Id.)
CBIZ seeks to narrow the reasonable application of its report such that “[a]ny reliance by UPMC
as a non-employer third party in a single year for its own different purpose was at its own risk.”
(Id. at 18.)
As a threshold issue, the Court must determine whether it can properly consider this
“disclaimer” at all. The “disclaimer” statement is not included with or attached to the Complaint.
Instead, CBIZ first referenced the “disclaimer” in its Brief in Support of Motion to Dismiss (ECF
No. 13 at 13-16) and, then, included what CBIZ purports to be this “disclaimer” as an attachment
to its brief (ECF No. 13-1 at 3). As a general matter, a district court ruling on a motion to dismiss
may not consider matters extraneous to the pleadings. In re Burlington Coat Factory Securities
Litigation, 114 F.3d 1410, 1426 (3d Cir. 1997) (citing Angelastro v. Prudential-Bache Securities, Inc.,
764 F.2d 939, 944 (3d Cir. 1985)). “However, an exception to the general rule is that a ‘document
integral to or explicitly relied upon in the complaint’ may be considered ‘without converting the
motion to dismiss into one for summary judgment.’” Schmidt v. Skolas, 770 F.3d 241, 249 (3d Cir.

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2014) (quoting Burlington, 114 F.3d at 1426). “The rationale underlying this exception is that the
primary problem raised by looking to documents outside the complaint—lack of notice to the
plaintiff—is dissipated ‘[w]here the plaintiff has actual notice . . . and has relied upon these
documents in framing the complaint.” Id. (quoting Burlington, 114 F.3d at 1426). “[W]hat is
critical is whether the claims in the complaint are ‘based’ on an extrinsic document and not merely
whether the extrinsic document was explicitly cited.” Id. (quoting Burlington, 144 F.3d at 1426).
In the present case, neither party briefed or otherwise discussed the Court’s ability to consider
CBIZ’s attachments.

Yet, because the Court views CBIZ’s report to be “integral to” the

Complaint, the Court will consider the “disclaimer” contained within CBIZ’s attachment to its
brief.
This purported “disclaimer” fails to undermine the reasonableness of UPMC’s reliance,
primarily because, as UPMC points out, this “disclaimer” is not a disclaimer at all. Unlike those
non-binding cases cited by CBIZ, which contain unequivocal statements of limitation for specific
purposes, the “disclaimer” simply states that the report was prepared “for the purposes of
fulfilling the employer financial accounting requirements.” (ECF No. 13-1 at 3.) It does not
contain any words of limitations or indicate that the report can be used “solely” or “only” for a
particular purpose. Cf. Ellis v. Grant Thornton LLP, 530 F.3d 280, 285 (4th Cir. 2008) (directly
stating that the report “should not be used by third parties for any other purpose”); SC&E Admin.
Servs., Inc. v. Deloitte, No. A-05-CA-929-SS, 2006 WL 6747974, at *10 (W.D. Tex. July 25, 2006)
(directly stating that the report is “solely for the use of, and only to be relied upon by” the
defendant). When all reasonable inferences from the alleged facts are made in the light most
favorable to UPMC, see Phillips, 515 F.3d at 338, this broad and generic statement that the report

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is for “financial accounting requirements” scarcely makes it unreasonable to rely on the report to
judge the extent of the pension liabilities for which the report was created to calculate.
In fact, when the entire “disclaimer” is read in the light most favorable to UPMC, it has
quite the opposite effect of that CBIZ seeks to attribute to it. The “disclaimer,” which appears to
be signed and dated by Ketzner, is entitled “Actuary’s Disclosure Statement.” (ECF No. 13-1 at
3.) It states that the report’s actuarial computations comply with appropriate GAAP standards,
indicates that Ketzner is competent to perform those calculations, and confirms that CBIZ has no
financial interest in Altoona. (ECF No. 13-1 at 3.) If anything, under federal pleading standards,
this “disclaimer” would make it more reasonable for UPMC to rely on the report.
iv. “Due Diligence”
Lastly, CBIZ argues that “UPMC must set forth ‘specific facts demonstrating that [it]
exercised the due diligence that a reasonable person under all the circumstances would have
exercised to protect [its] own interests.’” (ECF No. 13 at 18) (quoting Fulton Fin. Advisors, Nat.
Ass’n v. NatCity Investments, Inc., Civil Action No. 09-4855, 2013 WL 5635977, at *13 (E.D. Pa. Oct.
15, 2013)). Because UPMC is a sophisticated party with hospital acquisition experience, CBIZ
contends that it was unreasonable for UPMC to rely on CBIZ’s report in determining Altoona’s
pension obligation. (Id.) In essence, CBIZ takes the position that UPMC acted unreasonably as a
matter of law because UPMC chose to trust CBIZ’s calculations as to Altoona’s pension liabilities
rather than independently investigating and calculating Altoona’s pension liability. The Court
does not find this argument compelling.
To the contrary, the Court agrees with UPMC that, if the Court accepted CBIZ’s
argument, Section 552 and Bilt-Rite would be rendered a virtual nullity. If it is considered

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unreasonable as a matter of law for a third party to rely on a professional’s services and work
product under these allegations, then Section 552 and Bilt-Rite’s extension of liability to third
parties would be nothing more than an illusion. The Court also agrees with UPMC that the cases
cited by CBIZ are, by in large, simply persuasive authorities and are distinguishable because of
higher pleading standards, different procedural posture, or dissimilar facts. 23 (See ECF No. 29 at
21-22.)
CBIZ asks the Court to impose a “due diligence” requirement on UPMC. But, neither
Section 552 nor Bilt-Rite use the term “due diligence.” “Due diligence” could be viewed as
nothing more than a reasonableness requirement, which Section 552 and Bilt-Rite clearly require
in the form of justifiable reliance. Yet, depending on the context and precise usage of the term,
“due diligence” can take on different meanings and impose a higher affirmative duty of thorough
investigation. 24

CBIZ’s definition of “due diligence” would evidently require that UPMC

In particular, CBIZ emphasizes the Pennsylvania Supreme Court’s decision in Porreco, 811 A.2d 566 at
571-72. CBIZ represents that Porreco stands for the proposition that, even for unsophisticated parties, it is
unreasonable to rely on valuations by opposing parties. (ECF No. 13 at 19.) Yet, the holding in Porreco was
in a different factual and legal context; the Porreco court held that a wife’s reliance on her husband’s
misrepresentation of the value of her engagement ring was not reasonable for the purposes of determining
whether their prenuptial agreement could be voided under the contract theory of fraudulent
misrepresentation when the wife had possession of the ring when the prenuptial agreement was made and
had sufficient opportunity to obtain an appraisal. See id. Even beyond this distinction, the Porreco court
specifically stated that “[w]e find [the wife’s] failure to do this simple investigation to be unreasonable.” Id.
at 572 (emphasis added). The simple investigation of appraising a single engagement ring which was fully
within the wife’s possession pales in comparison to the complex recalculation of an acquisition target’s
multimillion dollar pension obligations that were allegedly miscalculated from at least July 1, 2008 through
February 2015. (ECF No. 1 ¶ 11.) The Court also notes that Porreco inspired great disagreement among the
Pennsylvania Supreme Court Justices; three justices authored concurring opinions and three justices
dissented.
24 See Diligence, Black’s Law Dictionary (10th ed. 2014) (“due diligence (18c) 1. The diligence reasonably
expected from, and ordinarily exercised by, a person who seeks to satisfy a legal requirement or to
discharge an obligation. — Also termed reasonable diligence; common diligence. 2. Corporations & securities. A
prospective buyer’s or broker’s investigation and analysis of a target company, a piece of property, or a
newly issued security. A failure to exercise due diligence may sometimes result in liability, as when a
23

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independently recalculate and perform all of Altoona’s actuarial valuations without any
meaningful reliance on CBIZ’s 13 years (at minimum) of valuations of Altoona’s pension
obligations. While the Court will not embark on a linguistic or semantic inquiry into “due
diligence,” for the purposes of Section 552 and the relevant case law, the diligence that is “due”
is defined as acting reasonably under the circumstances. And, as discussed supra, the Complaint
sufficiently alleges that UPMC’s reliance on the report was reasonable under the circumstances.
Ultimately, “the issue of whether reliance on a representation is reasonable (or justifiable)
is generally a question of fact that should be presented to the jury.” Luther, 2008 WL 2397331, at
*4 (quoting Dilworth v. Metro. Life Ins. Co., 418 F.3d 345, 354 (3d Cir. 2005); Trans v. Metro. Life. Ins.
Co., 408 F.3d 130, 139 (3d Cir. 2005)). Reasonableness of reliance is “rarely susceptible of summary
disposition.” Williams Controls, Inc. v. Parente, Randolph, Orlando, Carey & Associates, 39 F. Supp.
2d 517 (M.D. Pa. 1999) (quoting In re Atlantic Fin. Management, Inc. Sec. Litig., 718 F. Supp. 1003,
1008 (D. Mass. 1988)). The present case is not one of these rare instances, and Count 3 will not be
dismissed for failure to allege duty or justifiable reliance.
VII.

Conclusion
Count 1 and Count 2 will not be dismissed because the Complaint sufficiently alleges

damages. Count 2 will not be dismissed because the Complaint pleads a cognizable cause of
action of professional negligence by an actuary. Count 3 will not be dismissed because the
Complaint adequately alleges duty and justifiable reliance.

broker recommends a security without first investigating it adequately. 3. Criminal law. The prosecutorial
burden of meeting all speedy-trial requirements in bringing a criminal defendant to justice.”).

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In sum, the presumptively true factual allegations of the Complaint plausibly give rise to
entitlement to relief on all three counts. Thus, Defendants’ Motion to Dismiss (ECF. No. 12) will
be denied in its entirety
A corresponding order follows.

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IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
UPMC d/b/a UNIVERSITY OF
PITTSBURGH MEDICAL CENTER, and
UPMC ALTOONA f/k/a ALTOONA
REGIONAL HEALTH SYSTEM,

)
)
)
)

Case No. 3:16-cv-204
JUDGE KIM R. GIBSON

)

Plaintiffs,

)
)

)

~

)

CBIZ, INC., CBIZ BENEFITS &
INSURANCES SERVICES, INC., and
JON S. KETZNER,

)

)
)
)

Defendants.

)
ORDER

NOW, this 29th day of September 2017, upon consideration of Defendants' Motion to
Dismiss (ECF No. 12) and all briefs filed by the parties, and for the reasons set forth in the
accompanying Memorandum Opinion, it is HEREBY ORDERED that Defendants' Motion to
Dismiss is DENIED. Thus, pursuant to Federal Rule of Civil Procedure 12(a)(4)(A), Defendants
shall file an answer on or before October 20, 2017.

BY THE COURT:

KIM R. GIBSON
UNITED STATES DISTRICT JUDGE