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Rodgers v. Lincoln Benefit Life Co.

United States District Court, W.D. Pennsylvania, Pittsburgh.

September 30, 2019

WILLIAM L. RODGERS, Plaintiff,
v.
LINCOLN BENEFIT LIFE COMPANY, ROBERT MARTINI, MARTINI FINANCIAL SERVICES, LLC, Defendants,

          OPINION

          Marilyn J. Horan United States District Judge

         Plaintiff, William L. Rodgers ("Rodgers"), brings the within action against Defendants, Lincoln Benefit Life Company, Robert Martini, and Martini Financial Services, LLC (collectively "Defendants") for Negligent Misrepresentation (Count I) and Violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (Count II) based upon Rodgers' purchase of a life insurance policy from the Defendants. (ECF No. 1-2).

         Pending before the Court are Defendants' Motions for Judgment on the Pleadings, pursuant to Fed.R.Civ.P. 12(c), wherein Defendants contend that Rodgers' claims are barred by the applicable statutes of limitations. Rodgers has responded, in part, by requesting the Court to convert Defendants' Motions to Dismiss into Motions for Summary Judgment. Upon consideration of Rodgers' Complaint (ECF No. 1-2); Defendants, Robert Martini and Martini Financial Services, LLC's ("Martini"), and Defendant, Lincoln Benefit Life Company's (Lincoln Benefit"), respective Answers (ECF Nos, 10 and 12); Martini's and Lincoln Benefit's respective Motions for Judgment on the Pleadings and Briefs in Support (ECF Nos. 27, 28, 29 and 30); Rodgers' Motion to Convert to Summary Judgment and Brief in Support (ECF Nos. 34 and 35); Rodgers' Responses and Reply Briefs to Martini's and Lincoln Benefit's respective Motions for Judgment on the Pleadings (ECF Nos. 36, 37, 38, and 39); Lincoln Benefit's and Martini's respective Reply Briefs to Rodgers' Opposition to Motions for Judgment on the Pleadings (ECF Nos. 44 and 46); Lincoln Benefit's and Martini's respective Responses to Rodgers' Motion to Convert to Summary Judgment (ECF Nos. 45 and 47); Rodgers' Replies to Lincoln Benefit's and Martini's respective Responses to Rodgers' Motion to Convert to Summary Judgment (ECF No. 48 and 49); and for the following reasons, Rodgers' Motion to Convert to Summary Judgment will be GRANTED, and Martini and Lincoln Benefit's Motions for Judgment on the Pleadings, as converted to and considered as Motions for Summary Judgment, will be GRANTED.

         I. Background

         On February 28, 2019, Rodgers filed this action in the Butler County Court of Common Pleas. (ECF No. 1). Lincoln Benefit removed the case on March 29, 2019. Id. In November 1999, Rodgers purchased a Lincoln Benefit Universal Life policy (the "Policy"), from Martini, which provided a $500, 000 death benefit. (ECF No. 1-2 at ¶¶ 12, 14). Rodgers, upon advice of Martini, transferred $20, 000 to Lincoln Benefit so that the return on the investment would pay for the policy. Id. at ¶ 13 On October 6, 2004, Rodgers received correspondence from Lincoln Benefit requesting a premium payment in the amount of $40, 000. Id. at ¶ 16. Martini informed Rodgers that the stock market had not produced enough return on the initial $20, 000 investment to pay for the policy premiums. Id. at ¶ 17. Martini advised that Rodgers' could instead make a $600.00 per month premium payment in order to keep the policy in effect. Id. at ¶ 18. Thereafter, from November 2004 through June 2016, Rodgers paid $600.00 per month to Lincoln Benefit. Id., at ¶ 19. On April 6, 2016, Lincoln Benefit advised that the Policy would be terminated if Rodgers did not pay $4, 072.14. Id. at ¶ 21. On April 15, 2016, Martini again advised Rodgers that the investments had failed to "keep up," and the cost to continue to maintain the Policy would increase to $ 1, 241.50 per month. Id. at ¶ 23. In June 2016, Rodgers stopped paying the $600 per month, and he never paid the requested $1, 241.50 per month. Id. at ¶ 29 Accordingly, on July 6, 2016, he received notice that his policy would terminate unless he paid Lincoln Benefit $3, 958.96. Id. at ¶ 30.

         Following the close of pleadings, Lincoln Benefit and Martini filed their Motions for Judgment on the Pleadings, arguing that claims are barred by the respective statutes of limitations. In response to Defendants' Motions for Judgment on the Pleadings, Rodgers' submitted an affidavit, which he asks the Court to consider by converting the Motions for Judgment on the Pleadings to Motions for Summary Judgment. In his Affidavit, Rodgers reaffirms the averments from his Complaint, and adds his reasoning to explain why he did not file his Complaint until 2019. In his affidavit, Rodgers asserts that he trusted Martini and that he considered the shortfall in the policy funding to be an honest mistake until January 18, 2018, when he, through legal research, realized that he may have legal claims against Martini and Liberty Benefit. (ECF No. 35-1).

         II. Discussion

         a. DefenseMotions for Judgment on the Pleadings

         Federal Rule of Civil Procedure 12(c) provides that "after the pleadings are closed - but early enough not to delay trial - a party may move for judgment on the pleadings." Fed.R.Civ.P. 12(c). Judgment on the pleadings is appropriate only when the movant "clearly establishes that no material issue of fact remains to be resolved and that he is entitled to judgment as a matter of law." Minnesota Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir. 2008) (internal quotations and citations omitted). When ruling on a motion for judgment on the pleadings, a court generally cannot consider matters outside of the pleadings. In re Burlington Coat Factory Sec, Litig, 114 F.3d 1410, 1426 (3d Cir. 1997). There is "no material difference in the applicable legal standards" for a motion for judgment on the pleadings under Rule 12(c) and a motion to dismiss under Rule 12(b)(6). Spruill v. Gillis, 372 F.3d 218, 223 n.2 (3d Cir. 2004).

         In deciding a motion to dismiss under Rule 12(b)(6), and similarly a motion for judgment on the pleadings, 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." Phillips v, Cty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008) (quoting Pinker v. Roche Holdings Ltd, 292 F.3d 361, 374 n.7 (3d Cir. 2002)). To survive dismissal, a complaint must allege facts sufficient to "raise a right to relief above the speculative level." Bell Atl Corp. v. Twombly, 550 U.S. 544, 555 (2007). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In order to determine the sufficiency of a complaint under Twombly and Iqbal, a court must engage in the following analysis: First, the court must take note of the elements a plaintiff must plead to state a claim. Second, the court should identify allegations that, because they are no more than conclusions, are not entitled to the assumption of truth. Finally, where there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement for relief. Connelly v. Steel Valley Sch Dist, 706 F.3d 209, 212 (3d Cir. 2013) (quoting Burtch v. Milberg Factors, Inc., 662 F.3d 212, 221 (3d Cir. 2011)).

         Defendants contend that Rodgers' claims for negligent misrepresentation and Unfair Trade Practices and Consumer Protection Law (UTPCPL) are barred by the applicable statutes of limitations. A two-year statute of limitation applies to Rodgers' negligent misrepresentation and professional negligence claims. 42 Pa. Cons. Stat. Ann. 5524(7); Cooper v. Sirota, 37 Fed.Appx. 46, 48 (3d Cir. 2002). A UTPCPL claim is subject to a 6-year statute of limitations under 42 Pa.C.S.A. § 5527; Morse v. Fisher Asset Mgmt., LLC, 2019 PA Super 78, 206 A.3d 521, 526 (2019). "A party may raise a statute of limitations defense in a Rule 12(c) motion if its application is apparent on the face of the complaint." United States v. Cephalon, Inc., 159 F.Supp.3d 550, 558 n.7 (E.D. Pa. 2016).

Federal Rule of Civil Procedure 8 does not require that a complaint anticipate or overcome affirmative defenses such as the untimeliness of a claim; thus, a complaint does not fail to state a claim simply because it omits facts that would defeat a statute of limitations defense. Consistent with this rule, a defendant may raise the statute of limitations as a defense in a Rule 12(b)(6) motion only if it is apparent on the face of the complaint that the claims are not time-barred. If the bar is not apparent on the face of the complaint, then it may not afford the basis for a dismissal of the complaint under Rule 12(b)(6). Federal courts have applied this same rule in the context of a motion for judgment on the pleadings.

Germinaro v. Fid. Nat'l Title Ins. Co., 107 F.Supp.3d 439, 449 (W.D. Pa. 2015) (cleaned up) (citing and quoting Schmidt v. Skolas, 770 F.3d 241, 248-49 (3d Cir. 2014)).

         According to the Complaint and Answer, without Rodgers' affidavit, Rodgers' claims of negligent misrepresentation and unfair trade practices stem from Lincoln Benefit and Martini's alleged misrepresentation about funding for the Policy and about the potential for future imposition and increase in premium payments to maintain the Policy. On the face of the Complaint, Rodgers pleads that in 2004 he was informed of the shortfall and that he needed to pay and did pay additional $600 monthly payments towards premium shortfalls from 2004. From his Complaint as of 2004, Rodgers knew that funding shortfalls had occurred and that monthly premium payments were necessary as a result. He pleads that he made the monthly payments to maintain the Policy for twelve years. He did not file any lawsuit until the present complaint, which he filed in February 2019. Said filing was fifteen years after he first knew that his 1999 Policy purchase payment of $20, 000 did not cover the accruing premiums, which was contrary to the Defendant's representation. Accordingly, from the face of the Complaint, all claims in the Complaint were filed beyond the two-year statute of limitations for ...


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