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Leonard Puggi v. Allstate Property and

July 21, 2011


The opinion of the court was delivered by: Genee.k. Pratter, J.



Allstate Property and Casualty Insurance Company ("Allstate") issued an automobile insurance contract to Plaintiff Leonard Puggi. Mr. Puggi claims that following a car accident, Allstate failed to make and/or unreasonably delayed making the payments owed to him under the insurance contract. Mr. Puggi alleges three counts in his Complaint: Breach of Contract (Count I), Bad Faith (Count II), and a violation of Pennsylvania's Unfair Trade Practices and Consumer Protection Law ("UTPCPL") (Count III). Allstate moves to dismiss Counts I and III, and for the reasons that follow, the Motion is denied in part with respect to Count I and granted in part without prejudice with respect to Count III.

Statement of Facts

Mr. Puggi commenced this suit against Allstate seeking recovery of unpaid policy limits regarding a December 13, 2005 car accident that left him physically injured. *fn1 The insurance contract carried a $100,000 policy limit for Underinsured Motorist ("UIM") coverage and a $100,000 Policy Limit for Medical Expenses as of August 9, 2005. Compl., Ex. A (Auto. Policy Declarations). Following his car accident, Mr. Puggi's attorney sent Allstate a letter, dated May 20, 2009, giving notice that the other motorist in the accident had only $50,000 of bodily injury liability coverage, and reporting that the motorist's insurer, State Farm Insurance Company, had offered $45,000 to Mr. Puggi for his alleged damages. Id. ¶ 14, Ex. B. Mr. Puggi's attorney further demanded payment of the remaining amount available under the Allstate UIM policy limits. Compl. ¶ 16, Ex. B. Mr. Puggi alleges that despite his cooperation with all of Allstate's requests made in response to his UIM benefits claim, including the furnishing of all medical records and necessary permissions to view his file, Allstate failed to honor the claim, including for separate medical expenses that are owed to him. Id. ¶¶ 7, 33, 38, 40.

Count I of Mr. Puggi's Complaint is a breach of contract claim for Allstate's failure to indemnify his losses under the insurance contract, and/or for an unreasonable delay in making these payments. Id. ¶ 47. Count II alleges that Allstate's failure to pay and/or unreasonable delay in making payments constitutes bad faith under Pennsylvania law. Id. ¶ 49. In Count III, Mr. Puggi alleges that Allstate's conduct and actions constitute unfair and deceptive practices under the Unfair Trade Practices and Consumer Protection Law ("UTPCPL"). Id. ¶ 51. Because Allstate does not challenge Count II, only the efficacy of Counts I and III are at issue here.

Standard of Review

A Rule 12(b)(6) motion to dismiss tests the sufficiency of a complaint. Conley v. Gibson , 355 U.S. 41, 45-46 (1957). Rule 8 of the Federal Rules of Civil Procedure requires only "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. 8(a)(2), 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 Conley , 355 U.S. at 47). While a complaint need not contain detailed factual allegations, the plaintiff must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. (citations omitted). Specifically, "[f]actual allegations must be enough to raise a right to relief above the speculative level . . . ." Id. (citations omitted).
In making such a determination, courts "must only consider those facts alleged in the complaint and accept all of those allegations as true." ALA, Inc. v. CCAIR, Inc. , 29 F.3d 855, 859 (3d Cir. 1994) (citing Hishon v. King & Spalding , 467 U.S. 69, 73 (1984)); see also Twombly , 550 U.S. at 555 (stating that courts must assume that "all the allegations in the complaint are true (even if doubtful in fact)"). The Court must also accept as true all reasonable inferences that may be drawn from the allegations, and view those facts and inferences in the light most favorable to the non-moving party. Rocks v. Philadelphia , 868 F.2d 644, 645 (3d Cir. 1989). The Court, however, need not accept as true "unsupported conclusions and unwarranted inferences," Doug Grant, Inc. v. Greate Bay Casino Corp. , 232 F.3d 173, 183-84 (3d Cir. 2000) (citing City of Pittsburgh v. West Penn Power Co. , 147 F.3d 256, 263 n.13 (3d Cir. 1998)), or the plaintiff's "bald assertions" or "legal conclusions," Morse v. Lower Merion Sch. Dist ., 132 F.3d 902, 906 (3d Cir. 1997).
To evaluate a motion to dismiss, the Court may consider the allegations contained in the complaint, exhibits attached to the complaint, matters of public record and records of which the Court may take judicial notice. See Tellabs, Inc. v. Makor Issues & Rts. , 551 U.S. 308, 322-23 (2007); Pension Benefit Guar. Corp. v. White Consol. Indus. , 998 F.2d 1192, 1196 (3d Cir. 1993). However, the Court is otherwise constrained to the facts alleged in the complaint. Discussion

A. Count I: Breach of Contract

Allstate has raised insufficient grounds for this Court to dismiss Count I. Allstate argues that the breach of contract claim should be dismissed because it has already paid Mr. Puggi the full $100,000 UIM policy limits owed to him, thus fully discharging Allstate's obligations under the contract. Def.'s Mot. at 10. Mr. Puggi, in his response, does not contest this assertion. *fn2

Nonetheless, Allstate's argument does not provide a sufficient basis for granting a motion to dismiss. Allstate's assertion that it paid Mr. Puggi's claim is an affirmative defense, which does not provide a basis for a Rule 12(b)(6) motion. See In Re Adams Golf , 381 F.3d 267, 277 (3d Cir. 2004) ("[A]n affirmative defense may not be used to dismiss a plaintiff's complaint under Rule 12(b)(6)."); Johnson v. Resources for Human Dev., Inc. , 860 F. Supp. 218, 221 (E.D. Pa. 1994) ("[A]n affirmative defense will not ...

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