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Deluca v. Progressive Advanced Insurance Co.

United States District Court, M.D. Pennsylvania

November 6, 2019

COLLEEN DELUCA, Plaintiff
v.
PROGRESSIVE ADVANCED INSURANCE COMPANY, Defendant

          MEMORANDUM

          JAMES M. MUNLEY, JUDGE.

         Before the court for disposition is Defendant Progressive Advanced Insurance Company's (hereinafter “defendant”) motion to dismiss Count II of plaintiff's complaint. The parties have briefed their respective positions and the matter is ripe for disposition.

         Background

         Plaintiff Colleen Deluca owned a Saab automobile covered under a policy of automobile insurance issued by defendant. (Doc. 1-1, Compl. ¶ 4). On August 28, 2017, plaintiff was involved in an automobile accident in Fairview Township, Luzerne County, Pennsylvania. (Id. ¶ 7-8). A vehicle turned in front of plaintiff's vehicle suddenly and without warning and then fled the scene. (Id. ¶ 8). The accident was solely caused by the unidentified driver of this vehicle. (Id. ¶ 9). The accident caused the following injuries in plaintiff: concussion, head and neck injury, back and spine injury, sleeplessness, headaches, loss of memory, extreme pain and suffering and soft-tissue injuries throughout her body. (Id. ¶ 16). She suffered, inter alia, pain, discomfort, frustration, and embarrassment, which is expected to continue for an indefinite time into the future. (Id. ¶ 10). She received medical treatment for her injuries and will need future medical treatment. (Id. ¶ 11).

         Plaintiff's automobile insurance policy provided uninsured motorist (hereinafter “UM”) coverage of $300, 000.00. (Id. ¶ 17). Defendant has refused to pay plaintiff these benefits. (Id. ¶ 21). Accordingly, plaintiff filed the instant two-count complaint. Count I is a cause of action for breach of insurance contract and Count II is a cause of action for insurance bad faith pursuant to 42 Pa. Cons. Stat. Ann. § 8371 (hereinafter “section 8371”). Defendant has moved to dismiss Count II pursuant to Federal Rule of Civil Procedure 12(b)(6), bringing the case to its present posture.

         Jurisdiction

         The court has jurisdiction pursuant to the diversity statute, 28 U.S.C. § 1332. Plaintiff is a citizen of Pennsylvania. (Doc. 1, Notice of Removal ¶ 5). Defendant is a citizen of Ohio. (Id. ¶ 8). Defendant Progressive Insurance is incorporated under the laws of the State of Ohio with its principal place of business in Mayfield Village, Ohio. (Id. ¶ 7) Additionally, the amount in controversy exceeds $75, 000. Because complete diversity of citizenship exists among the parties and the amount in controversy exceeds $75, 000, the court has jurisdiction over this case. See 28 U.S.C. § 1332 (“district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, and is between . . . citizens of different states[.]:”); 28 U.S.C. § 1441 (A defendant can generally move a state court civil action to federal court if the federal court would have had original jurisdiction to address the matter pursuant to the diversity jurisdiction statute). As a federal court sitting in diversity, the substantive law of Pennsylvania shall apply to the instant case. Chamberlain v. Giampapa, 210 F.3d 154, 158 (3d Cir. 2000) (citing Erie R.R. v. Tomkins, 304 U.S. 64, 78 (1938)).

         Legal Standard

         Defendant filed its motion to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The court tests the sufficiency of the complaint's allegations when considering a Rule 12(b)(6) motion. All well-pleaded allegations of the complaint must be viewed as true and in the light most favorable to the non-movant to determine whether, “‘under any reasonable reading of the pleadings, the plaintiff may be entitled to relief.'” Colburn v. Upper Darby Twp., 838 F.2d 663, 665-66 (3d Cir. 1988) (quoting Estate of Bailey by Oare v. Cnty. of York, 768 F.2d 503, 506 (3d Cir. 1985)). The plaintiff must describe “‘enough facts to raise a reasonable expectation that discovery will reveal evidence of' [each] necessary element” of the claims alleged in the complaint. Phillips v. Cnty. of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)). Moreover, the plaintiff must allege facts that “justify moving the case beyond the pleadings to the next stage of litigation.” Id. at 234-35. In evaluating the sufficiency of a complaint the court may also consider “matters of public record, orders, exhibits attached to the complaint and items appearing in the record of the case.” Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1384 n.2 (3d Cir. 1994) (citations omitted). The court does not have to accept legal conclusions or unwarranted factual inferences. See Curay-Cramer v. Ursuline Acad. of Wilmington, Del., Inc., 450 F.3d 130, 133 (3d Cir. 2006) (citing Morse v. Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir. 1997)).

         The federal rules require only that plaintiff provide “a short and plain statement of the claim showing that the pleader is entitled to relief, ” a standard which “does not require detailed factual allegations, ” but a plaintiff must make “a showing, rather than a blanket assertion, of entitlement to relief that rises above the speculative level.” McTernan v. N.Y.C., 564 F.3d 636, 646 (3d Cir. 2009) (citations and internal quotations and quotation marks omitted). The “complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570). Such “facial plausibility” exists “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 556). “[T]he factual detail in a complaint [cannot be] so undeveloped that it does not provide a defendant the type of notice of claim which is contemplated by Rule 8.” Phillips, 515 F.3d at 232 (citation omitted). “Though a complaint ‘does not need detailed factual allegations, . . . a formulaic recitation of the elements of a cause of action will not do.'” DelRio-Mocci v. Connolly Props., Inc., 672 F.3d 241, 245 (3d Cir. 2012) (quoting Twombly, 550 U.S. at 555).

         Discussion

         Section 8371 authorizes recovery for an insurance company's bad faith towards an insured. It provides for several remedies upon a finding of bad faith: (1) an award of “interest on the amount of the claim” at a rate equal to “the prime rate of interest plus 3%”; (2) an award of “punitive damages against the insurer”; and/or (3) an assessment of “court costs and attorney fees against the insurer.” Pennsylvania courts have adopted the following definition of “bad faith” on the part of an insurer:

[A]ny frivolous or unfounded refusal to pay proceeds of a policy; it is not necessary that such refusal be fraudulent. For purposes of an action against an insurer for failure to pay a claim, such conduct imports a dishonest purpose and means a breach of a known duty

(i.e., good faith and fair dealing), through some motive of self-interest or ill will; mere negligence or bad judgment is not bad faith. Perkins v. State Farm Ins. Co., 589 F.Supp.2d 559, 562 (M.D. Pa. 2008) (citing Terletsky v. Prudential Prop. & Cas. Ins. Co., 649 A.2d 680, 688 (Pa. Super. Ct. 1994) (quoting Black's Law Dictionary 139 (6th ed. 1990)) (citations omitted); see also Nw. Mut. Life Ins. Co. v. Babayan, 430 F.3d 121, 137 (3d Cir. 2005) (predicting the ...


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