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Gunning v. Prudential Insurance Co.

United States District Court, Third Circuit

October 7, 2013

SEAN GUNNING, as Administrator of the Estate of RUTH SHARON PARKER-GUNNING, Plaintiff,
v.
PRUDENTIAL INSURANCE COMPANY, Defendant.

MEMORANDUM OPINION

JEFFREY L. SCHMEHL, District Judge.

This matter involves a claim against Defendant insurance company for failure to pay the proceeds of a life insurance policy. There are two motions pending before the Court: Defendant's Motion to Dismiss Plaintiffs Complaint (Docket No. 10) and Plaintiffs Motion to Amend Plaintiffs Complaint (Docket No. 15). Both motions have been responded to, and are ready for decision. For reasons set forth below, I will grant Defendant's Motion to Dismiss, and allow Plaintiff twenty (20) days to file an Amended Complaint setting forth any claims Plaintiff may have under ERISA. Further, I deny Plaintiffs Motion to Amend the Complaint, as it seeks to add additional counts that are also preempted by ERISA.

I. INTRODUCTION

Plaintiff is the administrator of the estate of his late wife, Ruth Sharon Parker-Gunning ("Gunning"). Gunning was found dead after ingesting excessive amounts of prescribed pain medication. (Compl., ¶¶ 1, 5.) Gunning, as a former employee of U.S. Airways, was insured under a group life insurance policy issued by Prudential. (Compl., ¶ 3.) Prudential denied Plaintiff accidental death benefits under the group life policy due to the fact that its policy did not cover a loss resulting from suicide. (See Compl., Ex. A.) The medical examiner's report in this matter lists Gunning's cause of death as "acute prescription drug overdose." (Compl., ¶ 5.) Plaintiff alleges that Gunning's death was accidental. (Compl., ¶¶ 11.)

Prudential removed this case from the Philadelphia County Court of Common Pleas on July 9, 2013, and on July 31, 2013, Prudential filed a motion to dismiss Plaintiffs Complaint. Plaintiffs Complaint contains claims for breach of contract in Count I and "punitive damages" in Count II. (Compl., ¶¶ 15-16, 18-19.) The punitive damages count alleges that Prudential acted in "total bad faith" by drawing a conclusion of suicide from Gunning's overdose. (Compl., ¶ 19.) Thereafter, on August 30, 2013, Plaintiff filed a Motion to Amend the Complaint, seeking to file an Amended Complaint that contained the same breach of contract and punitive damages/bad faith claims as the original Complaint, together with new claims for violation of 42 Pa.C.S. § 8371 (Insurance Company Bad Faith) (Count III) and Statutory Bad Faith (Count IV). (See Am. Compl.)

II. STANDARD OF REVIEW

A Rule 12(b)(6) motion to dismiss 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)). In determining whether a 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 (citing 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 Rule 12(b)(6) motion, the complaint must provide "enough facts to raise a reasonable expectation that discovery will reveal evidence of the necessary element." Id. at 234 (quoting Twombly , 550 U.S. at 556, 127 S.Ct. at 1965, 167 L.Ed.2d at 940) (internal quotations omitted).

III. DISCUSSION

Prudential seeks to dismiss Plaintiffs Complaint on the grounds that it contains state law claims that are preempted by the Employee Retirement Security Act of 1974. ("ERISA"), 29 U.S.C. §§ 1001 et seq. (2005). Further, Prudential opposes Plaintiffs Motion to Amend the Complaint, as it argues that the amendment merely seeks to add more counts that are preempted by ERISA.

A. ERISA

As discussed above, this matter involves a dispute over death benefits under a policy of life insurance issued by Prudential and offered to employees of U.S. Airways. The first issue is whether or not this is an employee benefit plan governed by ERISA. ERISA defines an "employee welfare benefit plan" as:

[A]ny plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, or program was established or is maintained for the purpose of providing for its participants or their found that suits brought against insurance companies for denial of benefits "even when the claim is couched in terms of common law negligence or breach of contract, " are preempted by ERISA. Id . As the plan in question is an ERIS A plan, and Plaintiff's breach of contract claim is for benefits allegedly due under this plan, Plaintiff's claim for breach of contract is expressly preempted by ERISA and must be dismissed.

Plaintiff's Complaint also contains a claim for punitive damages due to Defendant's bad faith refusal to pay death benefits. Plaintiff does not specifically cite Pennsylvania's bad faith statute in this count of his complaint (42 Pa.C.S. § 8371); rather, he states that Defendant's refusal to pay benefits "totally lacks any merit whatsoever, thus is baseless, arbitrary and in bad faith." (Compl. ¶ 18.) Plaintiff further states that Defendant owed Plaintiff's decedent a "fiduciary duty of good faith and fair dealing and ...


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