The opinion of the court was delivered by: Anita B. Brody, J.
On October 1, 2008, Plaintiffs Lynne Azarchi-Steinhauser and Karen Azarchi ("Plaintiffs") filed a Second Amended Complaint against Defendants Alliance-One Inc. d/b/a/ Computer Services Corporation ("Alliance") and Protective Life Insurance Co. ("PLIC")*fn1 alleging five counts: 1) Breach of Contract; 2) Bad Faith; 3) Unjust Enrichment; 4) Breach of Good Faith and Fair Dealing; and 5) Agency. On November 12, 2008, Alliance filed a Motion to Dismiss Plaintiffs' Second Amended Complaint (Docket #27). On December 3, 2008, Plaintiffs filed a Cross Motion for Leave to Amend and File a Third Amended Complaint in opposition to Alliance's Motion to Dismiss (Docket #29).
Alliance moves to dismiss Counts I-V of Plaintiffs' Second Amended Complaint. In their Cross Motion for Leave to File a Third Amended Complaint, Plaintiffs withdraw Counts I-IV of the Second Amended Complaint as they pertain to Alliance, conceding that they cannot state a claim under these counts.*fn2 Plaintiffs, however, continue to assert Count V, labeled "Agency," against Alliance. In addition, Plaintiffs assert for the first time a claim for negligent misrepresentation (Count V of the Proposed Third Amended Complaint) against Alliance and PLIC. In their Reply to the Motion to Amend (Docket #30), Alliance opposes Plaintiffs' continued assertion of the agency claim as well as the inclusion of the negligent misrepresentation claim.
For the reasons stated below, the Court will grant Alliance's Motion to Dismiss and deny Plaintiffs' Motion to File a Third Amended Complaint as to all claims against Alliance.
Plaintiffs are the co-trustees of the Arthur Azarchi Irrevocable Trust ("the Trust"). On or about March 13, 2003, the Trust purchased two life insurance policies-No. FK5231068 ("Policy One") and No. FK3215386 ("Policy Two")-from Chase, insuring the life of Arthur Azarchi ("Mr. Azarchi"). Each policy provided a one million dollar death benefit to the beneficiary, which was the Trust. Chase was subsequently purchased by PLIC. Since the date of purchase, the Trust, as the policy owner, has paid the annual premium amounts of $21,640 and $34,320 on Policy One and Policy Two respectively.
On March 28, 2007, without noticing he had not signed his check, Mr. Azarchi mailed payment in the amount of $55,960 for the premiums due on both policies. Mr. Azarchi subsequently received notice from Chase and/or Alliance informing him Policy One had entered its "grace" period. Mr. Azarchi then sent another check for $34,320 to cover the premium for Policy One. In April 2007, Mr. Azarchi received a letter on PLIC letterhead. Prior to receiving this letter, Mr. Azarchi had no prior contact with PLIC and was unaware that PLIC was the successor in interest to Chase. The letter informed Mr. Azarchi that his check of $34,320 had been returned by the bank for reasons stated as "other." Mr. Azarchi then checked his bank account and saw a debit in the amount of the initial check of $55,960. Based on this, Mr. Azarchi believed that both premiums had been paid. As a result of the letter Mr. Azarchi received in April, he "began a long series of phone calls to the Client Services Department at the number listed on the correspondence," which "[u]pon information and belief was and is operated by Alliance, PLIC's agent..." (Pl.'s Cross Mot. for Leave to file Third Amend. Compl., Ex. E. ("Third Amend. Compl.") ¶23). During these phone conversations, Mr. Azarchi learned that "Chase was no longer his life insurance company as they had recently been bought by PLIC." (Id. at ¶ 25.) Each of the individuals from Alliance whom Mr. Azarchi spoke with told him that they would look into the situation and get back to him, but his phone calls were never returned. (Id.)
On July 3, 2007, Mr. Azarchi received another letter from PLIC and/or Alliance indicating that his premium for Policy One ($34,320) would lapse if it was not paid by July 23, 2007. Mr. Azarchi then contacted PLIC's customer services department, "which, upon information and belief was and is operated by CSC, PLIC's agent, servant, and/or representative, on numerous occasions, which provided no insight or clarification regarding the return of the checks or any change in the underwriter of these policies." ¶26 During one of his calls to the customer service department, Mr. Azarchi was placed in contact with a representative identified as Mr. Fritz who requested that Mr. Azarchi send another check in the amount of $34,320. Mr. Azarchi sent a check in that amount via Federal Express to a lockbox located in Columbus, GA, as instructed by Mr. Fritz. On July 20, 2007, PLIC and/or Alliance received this check. A week later, Mr Azarchi received a third letter from PLIC and/or Alliance requesting a check for $34,320.*fn4
On or about July 26, 2007, Mr. Azarchi received written notification that Chase had been acquired by PLIC. Mr. Azarchi called Mr. Fritz again to inquire about his policies. Mr. Fritz advised him that "he would look into the matter and contact Mr. Azarchi." ¶32. Receiving no word from Mr. Fritz, Mr. Azarchi contacted Mr. Fritz on August 28, 2007 and was informed that PLIC would renew Policy One but not Policy Two.*fn5 Mr. Azarchi continued to make calls to PLIC and/or Alliance regarding his policies but was ultimately informed that PLIC was not reinstating Policy Two.
Plaintiffs allege that "[a]t all material times and without limitation, CSC acted as the agent, servant, and/or representative for and on behalf of Chase and/or PLIC acting within the scope of its employment and authority."*fn6 ¶56. Furthermore, Plaintiffs claim that "as a direct and proximate result of the wrongful actions by CSC, Plaintiffs have been damaged in an amount equal to the benefits associated with [Policy Two] in the amount of $1,000,000.00." ¶57.
A. Motion to Dismiss Standard
Alliance has moved to dismiss Plaintiffs' Second Amended Complaint for failure to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6). In deciding a motion to dismiss pursuant to Rule 12(b)(6), a court must "accept all factual allegations as true, construe the complaint in light most favorable to the plaintiff, and determine whether, under a reasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008). To withstand a motion to dismiss under Rule 12(b)(6), "factual allegations must be enough to raise a right to relief above the speculative level." Id. at 234. This standard "simply calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of the ...