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Rosario v. J.D. Eckman

September 14, 2010

ARCADIO ROSARIO, JR., PLAINTIFF,
v.
J.D. ECKMAN, INC., MARK ECKMAN, RICHARD WITTLENGER, CONTINENTAL CASUALTY COMPANY AND CNA FINANCIAL COMPANY, DEFENDANTS.



The opinion of the court was delivered by: Henry S. Perkin United States Magistrate Judge

MEMORANDUM

Before the Court is the Motion to Dismiss Plaintiff's Amended Complaint filed by Defendants Continental Casualty Company ("CCC") and CNA Financial Company ("CNA") (collectively "Moving Defendants") (Dkt. No. 16). For the reasons that follow, the Motion will be granted.

I. BACKGROUND AND PROCEDURAL HISTORY.

On February 23, 2004, the Plaintiff, Arcadio Rosario ("Mr. Rosario") susatined an injury during his employment with Defendant J.D. Eckman, Inc. (Am. Compl., ¶¶ 15, 17.) At the time of Mr. Rosario's injury, Defendant CCC was the workers' compensation carrier for Defendant J.D. Eckman, Inc. (Am. Compl., ¶ 18.) On January 16, 2008, Mr. Rosario executed a "Compromise and Release Agreement by Stipulation to Section 449 of the Workers' Compensation Act." (Am. Compl., Ex., B.) Defendant CCC then issued a check to Plaintiff in the amount of $120,000 in full satisfaction of its obligations in the Release. (Id., ¶ 25(a).) On September 28, 2009, the Plaintiff, Arcadio Rosario ("Mr. Rosario") filed a ten-count Complaint against his former employer, J.D. Eckman, Inc., the company's owner and President, Mark Eckman, and the company's safety director, Richard Wittlenger, alleging violations of the Age Discrimination in Employment ("ADEA") (Count I), violations of Title VII of the Civil Rights Act of 1964 ("Title VII")(Count II), violations of the Americans with Disabilities Act ("ADA")(Count III), violations of 42 U.S.C. section 1981 ("Section 1981")(Count IV), violations of the Pennsylvania Human Relations Act ("PHRA")(Count V), breach of contract (Count VI), breach of the covenant of good faith and fair dealings (Count VII), intentional or reckless misrepresentation of fact (Count VIII), intentional infliction of emotional distress (Count IX) and wrongful discharge (Count X). This case was originally assigned to the Honorable Lawrence F. Stengel, and the parties consented to the exercise of jurisdiction by a Magistrate Judge on March 1, 2010. Judge Stengel entered a March 1, 2010 Order pursuant to 28 U.S.C. section 636(c) and Federal Rule of Civil Procedure 73 referring this case to the undersigned for resolution.

An April 6, 2010 Scheduling Conference pursuant to Federal Rule of Civil Procedure 16 was conducted and an Order was issued allowing Mr. Rosario additional time to file an Amended Complaint. Mr. Rosario's Amended Complaint against CNA Financial Company, Continental Casualty Company, Mark Eckman, J.D. Eckman, Inc. and Richard Wittlenger was filed on May 5, 2010.*fn1 On May 10, 2010, Defendants Mark Eckman, J.D. Eckman, Inc. and Richard Wittlenger filed their Response to the Amended Complaint. On June 6, 2010, the Moving Defendants filed a Motion to Dismiss Count VI (breach of contract), Count VII (breach of the covenant of good faith and fair dealing) and Count VIII (intentional or negligent misrepresentation) of the Amended Complaint. Mr. Rosario responded to the Motion to Dismiss on June 24, 2010, and CCC filed a brief in opposition to Mr. Rosario's Motion to Amend the Complaint to Add CNA Financial Corporation as a Defendant on July 7, 2010. On July 23, 2010, this Court ordered the Moving Defendants to file a Reply brief to Mr. Rosario's Response, and a short extension of time was granted until August 6, 2010. On August 10, 2010, Mr. Rosario filed a consent Motion for Leave to File a Sur-Reply, which was granted on August 16, 2010, and Mr. Rosario was ordered to file the Sur-Reply on or before August 20, 2010. On August 17, 2010, Mr. Rosario's verbal Motion for Extension was granted, and Mr. Rosario's Sur-Reply was filed on August 23, 2010.

II. STANDARD

A motion to dismiss under Rule 12 (b)(6) of the Federal Rules of Civil Procedure examines the legal sufficiency of the complaint. Conley v. Gibson, 355 U.S. 41, 45-46 (1957). The motion to dismiss standard has been the subject of recent examination, culminating with the United States Supreme Court opinion Ashcroft v. Iqbal, 129 S.Ct. 1927 (2009). Following Iqbal, "threadbare recitals of the elements of a cause of action supported by mere conclusory statements do not suffice" to defeat a Rule 12 (b)(6) motion to dismiss. Id. at 1949; see also Bell Atlantic v. Twombly, 550 U.S. 544 (2007). The Third Circuit Court of Appeals applied the principles of Iqbal in Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009), and articulated a two-part analysis that district courts in this Circuit must conduct in evaluating whether allegations in a complaint survive a 12 (b)(6) motion to dismiss.

First, the factual and legal elements of a claim should be separated, meaning "a District Court must accept all of the complaint's well-pleaded facts as true, but may disregard legal conclusions." Id. at 210-11. Second, the Court must determine whether the facts alleged in the complaint demonstrate that the plaintiff has a "plausible claim for relief." Id. at 211. A complaint must do more than allege a plaintiff's entitlement to relief, it must "show" such an entitlement with its facts. Id. (citing Phillips v. County of Allegheny, 515 F.3d 224, 234-35 (3d Cir. 2008)). "Where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not 'shown' that the pleader is entitled to relief." Iqbal, 129 S.Ct. at 1950; Jones v. ABN Amro Mortg. Group, Inc., 606 F.3d 119, 123 (3d Cir. 2010). The Supreme Court explained that deciding whether a "complaint states a plausible claim for relief will . . . be a context specific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal, 129 S.Ct. at 1950. "While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id.

III. DISCUSSION

A. The Claims Against the Moving Defendants

In the Amended Complaint, Mr. Rosario asserts pendent claims for breach of contract (Count VI), breach of the covenant of good faith and fair dealings (Count VII), and intentional or negligent misrepresentation (Count VIII) against J.D. Eckman, Inc., Continental Casualty Company and CNA Financial Company d/b/a CNA. Mr. Rosario contends that he compromised and released his worker's compensation benefits for a sum less than "the settlement value" and he was misled and induced to compromise and release his benefits by the Moving Defendants and the other Defendants. The Moving Defendants seek dismissal of these claims because they contend that the exclusivity and immunity provisions of the Pennsylvania Worker's Compensation Act ("the Act") bars these claims. Mr. Rosario argues, in response, that:

The exclusivity provisions of the Act regard work claims for injury or death. The plaintiff's claims are claims in contract that fall outside of the Act. Plaintiff does not attempt to litigate or relitigate his work injury of February 2004. The claims plead against the CNA Defendants are purely contract claims for breach of contract (Count VI), breach of covenant of good faith and fair dealing arising from the fraudulent misrepresentation (Count VII) and claims for misrepresentation that induced the plaintiff to enter into the Compromise and Release Agreement under false pretenses (Count VIII).

In particular, the Pennsylvania Supreme Court held that claims for fraudulent misrepresentation were not barred by the exclusive remedy provision of the Act. Martin v. Lancaster Battery Company, Inc., 530 Pa. 11, 606 A.2d 444.

The moving defendants mention the Martin case but conveniently disregard and minimize its impact, significance and holding. Instead, the moving defendants mistakenly relies on the lower court holding of Santiago v. Pennsylvania National Mutual Casualty Ins. Co., 418 Pa. Super. 178, 613 A.2d 1235 (1992). The Pennsylvania Superior Court in Santiago applied the exclusivity provision under the Act to Santiago's ...


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