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Perloff v. Transamerica Life Insurance Co.

United States District Court, E.D. Pennsylvania

August 13, 2019



          Rufe, J.

         Plaintiff Sally Perloff, the owner of a life insurance policy, and Plaintiff Neil Perloff, her husband and the insured, filed suit against Defendant Transamerica Life Insurance Company (“Transamerica”). Both Plaintiffs asserted claims of invasion of privacy and negligent infliction of emotional distress (“NIED claim”). Sally Perloff individually asserted claims of breach of contract and breach of fiduciary duty, and Neil Perloff individually brought a claim for loss of consortium. Transamerica has moved to dismiss for failure to state a claim. For the reasons that follow, the motion will be granted in part and denied in part.

         I. BACKGROUND

         The following facts alleged in the Complaint are assumed to be true for purposes of the motion to dismiss. Sally Perloff owned a life insurance policy for her husband Neil Perloff, which was issued by Transamerica, an Iowa-based corporation that conducts business in Pennsylvania.[1] In March 2017, Plaintiffs sold their home in Fort Washington, Pennsylvania and moved to Boynton Beach, Florida.[2] After moving, they notified Transamerica of their new address.[3] On July 17, 2017, Transamerica mailed a “lapse notice” for failure to pay the premiums on the policy to the Plaintiffs' son Brandon Perloff, and the same notice was also sent to Plaintiffs' home in Florida.[4] Plaintiffs contend that their son was not previously aware of the policy, and they were concerned that after receiving the mailing from Transamerica, he would share that information with his three brothers (all four siblings were alternate beneficiaries of the policy).[5] Plaintiffs were upset about the potential for their family and friends to learn about the lapse in payments, and were worried that if they were to make any changes to the policy now, it would cause “irreparable” family conflict.[6]

         Plaintiffs initially filed suit in Philadelphia Court of Common Pleas. Transamerica removed the case to this Court, based on diversity jurisdiction, and has now moved to dismiss for failure to state any claims.


         To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a plaintiff must plead “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged”[7] and “enough facts to raise a reasonable expectation that discovery will reveal evidence of the necessary element” of a claim.[8] The question is not whether the plaintiff ultimately will prevail, but whether the complaint is “sufficient to cross the federal court's threshold.”[9]

         In evaluating a challenged complaint, a 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 of the complaint, the plaintiff may be entitled to relief.”[10] Although the court must draw all reasonable inferences from the allegations in favor of the plaintiff, [11] it “need not accept as true unsupported conclusions and unwarranted inferences, ”[12] or the plaintiff's bald assertions or legal conclusions.[13]

         III. DISCUSSION[14]

         A. Breach of Contract

         Plaintiff Sally Perloff brings a breach of contract claim against Transamerica based on the Privacy Statement that Transamerica allegedly provided with the policy.[15] Transamerica argues that the Privacy Statement is not sufficiently definite to form a contract, but was solely a “general statement[]” or “unilateral corporate statement[].”[16] Transamerica further contends that Sally Perloff “has failed to point to any provision of the Policy that Transamerica breached.”[17]

         While widely published, vague corporate mission statements are not sufficient to support a breach of contract action;[18] policy statements that include specific and definite promises may be sufficient to support such an action.[19] To that end, Plaintiff Sally Perloff has alleged that the contents of the Privacy Statement “were included in, and made an integral part [] of the Policy or Contract of Insurance either expressly or by implication, ”[20] and that Transamerica, through its Privacy Statement, “promised and assured” that it would maintain the privacy and confidentiality of its Policyowners and Insureds.[21] The Court does not determine at this time whether the disclosure at issue potentially violated the Privacy Statement, or whether that Statement was part of the contract, only that Plaintiff Sally Perloff has alleged that Transamerica breached its obligations of privacy and confidentiality included in this Privacy Statement. Transamerica's motion to dismiss this claim will be denied at this time.[22]

         B. Invasion of Privacy

         Pennsylvania courts[23] have adopted section 652D of the Restatement (Second) of Torts, titled “Publicity Given to Private Life, ” the elements of which are: (1) publicity, given to (2) private facts, (3) which would be highly offensive to a reasonable person and (4) is not of legitimate concern to the public.”[24] To satisfy the “publicity” element, a matter must be made public through communication to either the general public or enough people that the matter is “substantially certain” to become public knowledge.[25] Pennsylvania courts have found that disclosure of private facts to one person[26] or a small group of people does not meet this standard.[27] Here, the information at issue was disclosed only to one person, and Plaintiffs' belief that “current technological advances” and their son's “extreme extroversion” might result in the disclosure of the information to others, does not make the information “substantially certain” to become public knowledge.[28]

         Plaintiffs also urge the Court to adopt a “special relationship” exception to the publicity requirement, in which disclosure made to a small group of people with a special relationship to a plaintiff constitutes publicity. However, the Pennsylvania Supreme Court has expressly chosen not to adopt the exception.[29] Thus, Plaintiffs' invasion of privacy claim will be dismissed with prejudice.

         C. NIED

         As Plaintiffs appear to concede, the three traditional theories for establishing NIED- where one (1) suffers a physical injury which causes emotional distress; (2) is in the “zone of danger”; or (3) witnesses an accident causing serious injury to a close family member-are inapplicable here. Some intermediate Pennsylvania courts have held that a claim of NIED may arise from a breach of a duty in a special relationship “where it is foreseeable that [such a breach] would result in emotional harm so extreme that a reasonable person should not be expected to endure the resulting distress.”[30] “It is a close question whether the Pennsylvania Supreme Court will ever rule that a claim for NIED may be based on the breach of a special relationship.”[31]Even assuming, for purposes of the motion to dismiss, that this type of claim is recognized under Pennsylvania law, it would not apply to the circumstances of this case.

         The type of relationship on which such an NIED claim may be premised occurs where a defendant has assumed an express or implied duty that encompasses a plaintiff's emotional well-being, such as a doctor and patient, or a decedent's family and a funeral home.[32] The relationship between an insurer and a beneficiary or insured person does not encompass the insured person's emotional well-being.[33] Plaintiffs argue that an insurance contract is “personal in nature and … so coupled with matters of mental concern and solicitude, or with the sensibilities of the policyowner for whom the duty is owed, that a breach of that duty will necessarily or reasonably result in mental distress[.]”[34] But it is not enough to allege that the relationship involved personal information; it must be the type of relationship where the plaintiff has put his emotional well-being in the defendant's hands. The Court will not extend this limited concept to encompass the relationship between insurer and insured. Thus, the Plaintiffs' claim of NIED will be dismissed with prejudice.

         D. Breach of Fiduciary Duty

         Sally Perloff also asserts that Transamerica breached a fiduciary duty arising from their contractual relationship. In response, Transamerica argues that Sally Perloff has not ...

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