United States District Court, W.D. Pennsylvania
MEMORANDUM OPINION AND ORDER OF COURT
TERRENCE F. McVERRY, District Judge.
Pending before the Court is the MOTION TO DISMISS COUNTERCLAIM (ECF No. 25) filed by Defendants Deborah J. Hewitt-Jackson and Richard C. Jackson (collectively, "the Jacksons") with brief in support (ECF No. 26); and their partial MOTION TO DISMISS Count One of the Complaint (ECF No. 29) with brief in support (ECF No. 29). Plaintiff, The Prudential Insurance Company of America ("Prudential"), filed a brief in opposition (ECF No. 43); D.R.J., a minor, by and through his natural mother and guardian Karen Wood, also filed a response in opposition (ECF No. 45).
The motions are now ripe for disposition. For the reasons that follow, the Court will deny the Jacksons partial motion to dismiss Count One and grant their motion to dismiss the "counterclaim."
The parties, counsel, and the Court are familiar with the background of this case and, therefore, the Court will not recite the facts at length. The following is a brief recitation of those matters relevant to the issues presently before the Court.
This action concerns the life insurance proceeds that Prudential paid to the Jacksons in the amount of $1, 318, 0000.00 as a consequence of the death of their son, Richard J. Jackson, (the "Death Benefits"). Jackson (the "Decedent") was insured under a Group Contract issued by Prudential to his employer, Motorola Solutions, Inc.; Xerox HR Solutions, LLC served as the third-party administrator ("TPA") for the plan, which is subject to the Employee Retirement Income Security Act ("ERISA").
After Decedent passed away on August 25, 2012 as a result of injuries he sustained in a traffic accident, the TPA notified Prudential of the claim. Roughly a week later, TPA sent a follow-up correspondence to Prudential in which it made reference to Decedent having a minor son and requested that Prudential mail copies of the "claim packet" to the Jacksons.
The Jacksons executed the Preferential Beneficiary's Statements, listing themselves as the highest class of beneficiaries of the Decedent and returned the forms to Prudential. Relevant here, the Group Contract provides that any insurance payable on the insured's life shall be paid to the designated beneficiary, or if no beneficiary has been designated to the first of the following: the insured's "(a) surviving spouse or Civil Union Partner; (b) surviving child(ren) in equal shares; (c) surviving parents in equal shares; (d) surviving siblings in equal shares; (e) estate." (ECF No. 1-2 at 48). By all accounts, it appears that Decedent did not designate a beneficiary.
Following receipt of the Jacksons' forms, Prudential processed payment to them based on their status representation(s). The TPA proceeded to question Prudential regarding why payment was made to the Jacksons rather than to the Decedent's minor child, D.R.J. Prudential soon investigated the possibility that D.R.J. was the highest surviving beneficiary and ultimately received a birth certificate from Karen Wood which listed Decedent as D.R.J.'s father. Prudential thereafter requested that the Jacksons either return the funds or place them in an escrow account. The Jacksons apparently refused and continued to spend the Death Benefits. This lawsuit followed.
Prudential initiated this action on June 7, 2013 in which it alleges claims for insurance fraud in violation of 18 Pa. Cons. Stat. Ann. § 4117(a)(2) at Count One and unjust enrichment under the ERISA at Count Two, as well as a request for interpleader relief under 29 U.S.C. § 1132(a) at Count Three. Prudential names D.R.J., by and through his natural mother and guardian, as a party to its request for interpleader relief. In response, Counsel for D.R.J./Wood filed a responsive pleading in which he includes a "counterclaim, " averring that the Jacksons have committed fraud when they filed a life insurance claim for the Death Benefits and denied the existence of D.R.J. As relief, Counsel requests that the Court "fashion an appropriate remedy to reimburse Karen Wood for all expense and legal fees she will pay until this action is completed." (ECF No. 12 at 10). The Jacksons filed a Motion to Dismiss the Counterclaim (ECF No. 25) with brief in support (ECF No. 26) and an Answer to Counterclaim (ECF No. 27).
The Court directed the parties to respond in its Memorandum Order dated January 31, 2014. Moreover, as to D.R.J., the Court noted that "it will be important to address the perceived shortcomings of the pleading as outlined in the motion to dismiss to ensure that the claim is plausible' in compliance with the federal pleading standard set forth and explained in Twombly and Iqbal as well as the heightened pleading standard required for fraud claims pursuant to Rule 9." All parties timely complied with this briefing schedule. Accordingly, the motions are now ripe for disposition.
II. Standard of Review
A motion to dismiss pursuant to Rule 12(b)(6) challenges the legal sufficiency of a complaint, which may be dismissed for the "failure to state a claim upon which relief can be granted." Fed.R.Civ.P. 12(b)(6) Upon review of a motion to dismiss, the Court must accept all well-pleaded facts and allegations, and must draw all reasonable inferences therefrom in favor of the plaintiff. Burtch v. Milberg Factors, Inc. , 662 F.3d 212, 220 (3d Cir. 2011), cert. denied , 132 S.Ct. 1861 (2012) (citing In re Ins. Brokerage Antitrust Litig. , 618 F.3d 300, 314 (3d Cir. 2010)). However, as the Supreme Court of the United States has made clear in Bell Atlantic Corp. v. Twombly , such "[f]actual allegations must be enough to raise a right to relief above the speculative level." 550 U.S. 554, 555 (2007).
The Supreme Court later refined this approach in Ashcroft v. Iqbal , emphasizing the requirement that a complaint must state a plausible claim for relief in order to survive a motion to dismiss. 556 U.S. 662, 678 (2009). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly , 550 U.S. at 555). Nevertheless, "the plausibility standard is not akin to a probability requirement, '" but ...