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Andrea S. Mclaren, Cnm v. Aig Domestic Claims

March 30, 2012

ANDREA S. MCLAREN, CNM, PLAINTIFF
v.
AIG DOMESTIC CLAIMS, INC., DEFENDANT



The opinion of the court was delivered by: James Knoll Gardner, United States District Judge

OPINION

This matter is before the court on Defendant AIG Domestic Claims, Inc.'s Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6), which motion was filed on November 30, 2010, together with the Brief of Defendant AIG Domestic Claims, Inc. in Support of Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6). Defendant's motion to dismiss and brief in support were reinstated on March 14, 2011. *fn1

-JKG Document 23 Filed 03/30/12 Page 2 of 33

On December 21, 2010, the Brief of Plaintiff Andrea S. McLaren, CNM in Opposition to Defendant AIG Domestic Claims, Inc.'s Motion to Dismiss Pursuant to F.R.C.P. 12(b)6) was filed. Plaintiff's brief was reinstated March 14, 2011.

On January 14, 2011, the Reply Brief of Defendant AIG Domestic Claims, Inc. in Further Support of Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6) was filed. Defendant's reply brief was reinstated on March 14, 2011. Hence this Opinion.

SUMMARY OF DECISION

For the following reasons, I grant defendant's motion to dismiss plaintiff's plaintiff's bad faith claim in Count I and breach of contract claim in Count II. Because I grant defendant's motion to dismiss with respect to both counts in plaintiff's Second Amended Complaint, plaintiff's Second Amended Complaint is dismissed with prejudice. *fn2

JURISDICTION

Jurisdiction in this case is based upon diversity of citizenship of the parties pursuant to 28 U.S.C. § 1332.

VENUE

Venue is proper pursuant to 28 U.S.C. § 1391(a)(2) because a substantial part of the events giving rise to plaintiff's claims allegedly occurred in Lehigh County, Pennsylvania, which is located within this judicial district.

PROCEDURAL HISTORY

Plaintiff Andrea S. McLaren, CNM instituted this action by filing her Complaint on August 20, 2010. Defendant AIG Domestic Claims, Inc. ("AIG") filed a motion to dismiss the Complaint on October 26, 2010. *fn3

On November 11, 2010, Ms. McLaren filed her Amended Complaint. AIG filed a motion to dismiss plaintiff's Amended Complaint on November 30, 2010. Ms. McLaren filed her brief in opposition to AIG's motion to dismiss the amended complaint on December 21, 2010. AIG filed its reply brief in support of its motion to dismiss the amended complaint on January 14, 2011.

On February 14, 2011, based upon deficiencies in the jurisdictional averments in plaintiff's Amended Complaint, I issued an Order granting plaintiff until March 4, 2011 to file a second amended pleading for the limited purpose of remedying the deficiencies identified by that Order. The Order granting Plaintiff McLaren leave to file a second amended complaint also dismissed AIG's then-pending motion to dismiss the Amended Complaint without prejudice to seek reinstatement of the motion to dismiss if plaintiff filed a second amended complaint establishing subject matter jurisdiction. *fn4

On March 1, 2011, plaintiff filed her Second Amended Complaint, which properly plead subject matter jurisdiction based on diversity of citizenship. AIG moved reinstate its November 30, 2011 motion to dismiss on March 10, 2011.

On March 14, 2011, I issued an Order reinstating AIG's motion to dismiss and the parties' earlier briefing on that motion. Upon reinstatement of AIG's motion to dismiss and brief in support, Plaintiff McLaren's brief in opposition, and AIG's reply brief in support of dismissal, AIG's motion to dismiss Plaintiff McLaren's Second Amended Complaint became ripe for disposition. Hence this Opinion.

STANDARD OF REVIEW

A claim may be dismissed under Federal Rule of Civil Procedure 12(b)(6) for "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6). A Rule 12(b)(6) motion requires the court to examine the sufficiency of the complaint. Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 102, 2 L.Ed.2d 80, 84 (1957) (abrogated in other respects by Bell Atlantic Corporation v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)).

Generally, in ruling on a motion to dismiss, the court relies on the complaint, attached exhibits, and matters of public record, including other judicial proceedings. Sands v. McCormick, 502 F.3d 263, 268 (3d Cir. 2008).

Except as provided in Federal Rule of Civil Procedure 9, a complaint is sufficient if it complies with Rule 8(a)(2), which requires "a short and plain statement of the claim showing that the pleader is entitled to relief."

Fed.R.Civ.P. 8(a)(2). Rule 8(a)(2) "[does] not require heightened fact pleading of specifics, but only enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570, 127 S.Ct. at 1974, 167 L.Ed.2d at 949. *fn5

In determining whether a plaintiff's complaint is sufficient, the court must "accept all factual allegations as true, construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading, the plaintiff may be entitled to relief." Fowler, 578 F.3d at 210 (quoting Phillips v. County of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008)).

Although "conclusory or 'bare-bones' allegations will [not] survive a motion to dismiss," Fowler, 578 F.3d at 210, "a complaint may not be dismissed merely because it appears unlikely that the plaintiff can prove those facts or will ultimately prevail on the merits." Phillips, 515 F.3d at 231. Nonetheless, to survive a 12(b)(6) motion, the complaint must provide "enough facts to raise a reasonable expectation that discovery will reveal evidence of the necessary element[s]." Id. (quoting Twombly, 550 U.S. at 556, 127 S.Ct. at 1965, 167 L.Ed.2d at 940) (internal quotation omitted).

The court is required to conduct a two-part analysis when considering a Rule 12(b)(6) motion. First, the factual matters averred in the complaint, and any attached exhibits, should be separated from legal conclusions asserted therein. Fowler, 578 F.3d at 210. Any facts pled must be taken as true, and any legal conclusions asserted may be disregarded. Id. at 210-211.

Second, the court must determine whether those factual matters averred are sufficient to show that the plaintiff has a "plausible claim for relief." Id. at 211 (quoting Iqbal, __ U.S. at __, 129 S.Ct. at 1950, 178 L.Ed.2d at 884).

Ultimately, this two-part analysis is "context-specific" and requires the court to draw on "its judicial experience and common sense" to determine if the facts pled in the complaint have "nudged [plaintiff's] claims" over the line from "[merely] conceivable [or possible] to plausible." Iqbal, __ U.S. at __, 129 S.Ct. at 1950-1951, 178 L.Ed.2d at 884-885 (internal quotations omitted).

A well-pleaded complaint may not be dismissed simply because "it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely." Twombly, 550 U.S. at 556, 127 S.Ct. at 1965, 167 L.Ed.2d at 940-941.

FACTS

Based upon the averments in plaintiff's Second Amended Complaint, which I must accept as true under the foregoing standard of review when considering a motion to dismiss, the pertinent facts are as follows.

Plaintiff Andrea S. McLaren is a certified nurse midwife ("CNM"). Ms. McLaren is a citizen of Pennsylvania and resides in Stroudsburg, Pennsylvania. *fn6

Defendant AIG Domestic Claims, Inc. ("AIG") is a Delaware corporation with its principle place of business in Jersey City, New Jersey. *fn7 AIG is a wholly-owned subsidiary of the National Union Fire Insurance Company of Pittsburgh, PA ("National Union"). *fn8

Plaintiff avers that AIG acts on behalf of National Union when claims are filed against National Union's insureds, and that AIG is National Union's "agent, subsidiary, or alter ego." *fn9

Specifically, Ms. McLaren avers that AIG is responsible for assigning defense counsel for National Union's insureds when a claim covered by a National Union policy is brought against the insured, and for otherwise administering and evaluating all such claims. Plaintiff avers that AIG has the authority to negotiate all settlements of claims under National Union policies, including the Policy at issue. *fn10

Plaintiff McLaren's Insurance Policy In April 2004, Ms. McLaren's former insurer stopped writing medical malpractice insurance, so she sought new professional liability coverage. *fn11 In July 2004, Ms. McLaren submitted an application for insurance coverage on a pre-printed form she obtained from the American College of Nurse Midwifes ("ACNM"). The name "National Union Fire Insurance Company of Pittsburgh, PA" appeared at the top of the application form. *fn12

After submitting that application form, plaintiff McLaren received a "Certificate of Liability Insurance" from Contemporary Insurance Services, an ...


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