United States District Court, W.D. Pennsylvania
JOY FLOWERS CONTI, Chief District Judge.
Pending before the court is a motion to dismiss (ECF No. 5) filed by defendants Metropolitan Life Insurance Company and Metlife, Inc. (collectively "Metlife"). On February 12, 2015, Metlife removed this action from state court. (ECF No. 1.) The complaint filed by plaintiff Lori Hajdu ("plaintiff") seeks damages for breach of contract, violation of the Pennsylvania insurance bad faith statute, and equitable estoppel. On April 9, 2015, the court held a hearing on this matter. For the reasons set forth below, the court will grant the motion to dismiss.
II. Facts as Alleged in the Complaint
The following facts, set forth in the complaint, are accepted as true for purposes of resolving the motion to dismiss. Plaintiff's husband, William Hajdu, died in 2012. (Compl. ¶ 2, ECF No. 1-2.) William Hajdu worked for the United States Department of Defense for more than twenty years. (Compl. ¶ 7.) William Hajdu elected to participate in the Federal Employee Group Life Insurance ("FEGLI") program. (Compl. ¶ 8.) The FEGLI program was administered by Metlife. (Compl. ¶ 6.) Under the terms of the FEGLI program, William Hajdu selected three coverage options: Basic coverage, which provides a death benefit equal to the insured's annual salary, rounded to the nearest thousand dollars plus $2, 000; Option A, which provides an additional death benefit of $10, 000; and Option B, which provides an additional death benefit of one to five times the insured's annual salary, rounded to the nearest thousand dollars. (Compl. ¶ 10.) William Hajdu selected Option B coverage of twice his annual salary. (Id. ) Plaintiff was the beneficiary of the life insurance policy. (Compl. ¶ 9.)
On September 30, 2010, William Hajdu separated from federal service with the Department of Defense. (Compl. ¶ 11.) William Hajdu continued to be covered by the FEGLI policy after separating from federal service, and his life insurance premiums were deducted from his retirement annuity. (Compl. ¶ 13.)
On January 31, 2011, William Hajdu commenced employment with the Defense Contract Management Agency. (Compl. ¶ 15.) William Hajdu enrolled in the FEGLI program and selected coverage identical to his coverage from his employment with the Department of Defense. (Compl. ¶ 16.) Premiums for this coverage were deducted from his pay. (Id. ) William Hajdu requested that deductions from his retirement annuity cease, but this request was not acted upon until after his death. Until the time of his death, premium payments were deducted both from his retirement annuity and his salary. (Compl. ¶ 18.)
After William Hajdu died, plaintiff submitted applications for life insurance benefits under both the annuitant policy and the employmee policy to Metlife. (Compl. ¶ 21.) On February 13, 2013, Metlife paid life insurance benefits of $231, 155.07 to plaintiff. This benefit was for the FEGLI policy for William Hajdu's employment with the Defense Contract Management Agency and was based upon William Hajdu's annual rate of pay at the time of death. (Compl. ¶ 22.) On May 15, 2013, Metlife refused to pay benefits in the amount of $226, 000 due under the FEGLI policy for William Hajdu's retirement from the Department of Defense. (Compl. ¶ 23.) Metlife tendered to plaintiff a refund of $2, 615.70 for premiums collected from William Hajdu's retirement annuity from January 31, 2011, to December 27, 2012. (Compl. ¶ 24.)
Metlife asserts that the refund discharged its obligations under the retirement FEGLI policy. Plaintiff asserts that Metlife's failure to pay the $226, 000 death benefit breached the terms of the insurance policy, violated state and federal law, and constituted bad faith under 42 PA. CONS. STAT. § 8371.
III. Standard of Review
A motion to dismiss tests the legal sufficiency of the complaint. Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d Cir. 1993). The court primarily considers the allegations of the complaint, but the court may also consider "matters incorporated by reference or integral to the claim, items subject to judicial notice, matters of public record, orders, items appearing in the record of the case, and exhibits attached to the complaint whose authenticity is unquestioned." 5B CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1357 (3d ed. 2004); see Pryor v. Nat'l Collegiate Athletic Ass'n, 288 F.3d 548, 560 (3d Cir. 2002) ("Documents that the defendant attaches to the motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to the claim; as such they may be considered by the court.'" (quoting FEDERAL PROCEDURE § 62:508 (Lawyers' ed. 1996))).
In deciding a motion to dismiss, the court is not opining on whether the plaintiff will be likely to prevail on the merits; rather, when considering a motion to dismiss, the court accepts as true all well-pleaded factual allegations in the complaint and views them in a light most favorable to the plaintiff. U.S. Express Lines Ltd. v. Higgins, 281 F.3d 383, 388 (3d Cir. 2002). While a complaint does not need detailed factual allegations to survive a Federal Rule of Civil Procedure 12(b)(6) motion to dismiss, a complaint must provide more than labels and conclusions. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). A "formulaic recitation of the elements of a cause of action will not do." Id. "Factual allegations must be enough to raise a right to relief above the speculative level" and "sufficient to state a claim for relief that is plausible on its face." Id. "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." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556).
The plausibility standard is not akin to a "probability requirement, " but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts that are "merely consistent with" a defendant's liability, it "stops short of the line between possibility and plausibility of entitlement to relief.'" Id. (quoting Twombly, 550 U.S. at 556-57) (internal citation omitted). Two working principles underlie Twombly. Id. First, with respect to mere conclusory statements, a court need not accept as true all the allegations contained in a complaint. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citing Twombly, 550 U.S. at 555). Second, to survive a motion to dismiss, a claim must state a plausible claim for relief. Id. at 679. "Determining 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." Id. "But 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 show[n]'-that the pleader is entitled to relief.'" Id. (quoting FED. R. CIV. P. 8(a)(2)). A court considering a motion to dismiss may begin by identifying pleadings that are not entitled to the assumption of truth because they are mere conclusions.
While legal conclusions can provide the framework of the 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.