United States District Court, E.D. Pennsylvania
J. Pappert J.
Biela uses an oil-fired boiler to heat her home. The oil tank
ruptured spilling oil throughout her property. She sued
Westfield Insurance Company for breach of contract and bad
faith after Westfield denied her all-risk homeowner's
insurance claim. Westfield removed the case and moved to
dismiss Count II, the bad faith claim. For the reasons below,
the Court grants the motion with leave to file an amended
owns a single-family home that is equipped with an oil-fired
boiler. (Compl., ECF No. 1, Ex. 1, ¶¶ 12-14.) She
hired Carney Plumbing, Heating & Cooling Inc. to install
an above-ground oil tank on her property, (id.
¶¶ 5, 15-17), and subsequently contracted with
Moyer & Son Inc. to deliver the oil. (Id.
¶¶ 24, 26, 28.) On January 24, 2019, Moyer
delivered 190.4 gallons of oil to fill the 275-gallon tank.
(Id. ¶¶ 26-27.) While Moyer was filling
the tank, it “suddenly and accidentally tore apart,
cracked, or ruptured” causing an oil spill on
Biela's property. (Id. ¶¶ 28-29.) The
impact of the spill was expansive: it “migrated
underneath the basement concrete floor slab, ”
“entered two sump pumps, ” and was
“discharged” along the road that bordered the
property. (Id. ¶¶ 30-31.) As a result, the
home became uninhabitable and Biela was forced to vacate her
property. (Id. ¶¶ 34-35.)
the spill, Biela contacted Westfield seeking coverage for the
loss. See (id. ¶¶ 36-37). Biela
alleges that her policy covers oil spills and was active from
January 3, 2019 until January 3, 2020, but Westfield denied
the claim. See (id. ¶¶ 37-38;
42). Biela's Complaint, however, does not allege facts
regarding the terms of her insurance policy, when she
submitted a claim to Westfield, the investigation that
Westfield performed, or any communications between herself
and Westfield. Biela nonetheless claims that Westfield
“performed a substandard and hasty inspection of the
loss”; refused to provide additional living expenses
despite the fact that she paid for a policy that included
them; and “improperly denied” her claim.
(Id. ¶¶ 39-41.)
sued Westfield, Carney and Moyer in the Philadelphia County
Court of Common Pleas. See (Compl.). Once the latter
two non-diverse defendants were severed, Westfield removed
the lawsuit to this Court on the basis of diversity
jurisdiction. (Def.'s Notice of Removal, ECF No. 1.)
survive dismissal under Rule 12(b)(6) of the Federal Rules of
Civil Procedure, 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
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). A claim is facially plausible when the facts pled
“allow[ ] the court to draw the reasonable inference
that [a] defendant is liable for the misconduct
alleged.” Iqbal, 556 U.S. at 678.
“[W]here 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. at 679 (quoting Fed.R.Civ.P.
the complaint includes well-pleaded factual allegations, the
Court “should assume their veracity and then determine
whether they plausibly give rise to an entitlement to
relief.” Connelly v. Lane Const. Corp., 809
F.3d 780, 787 (3d Cir. 2016) (quoting Iqbal, 556
U.S. at 679). However, this “presumption of truth
attaches only to those allegations for which there is
sufficient factual matter to render them plausible on their
face.” Schuchardt v. President of the U.S.,
839 F.3d 336, 347 (3d Cir. 2016) (internal quotation and
citation omitted). “Conclusory assertions of fact and
legal conclusions are not entitled to the same
bad faith statute provides that a court may award interest,
punitive damages and attorneys' fees if it “finds
that the insurer has acted in bad faith toward the
insured.” 42 Pa. Con. Stat. § 8371. Although the
statute itself does not define “bad faith, ”
courts have defined the term as “any frivolous or
unfounded refusal to pay proceeds of a policy.”
Keefe v. Prudential Prop. & Cas. Ins. Co., 203
F.3d 218, 225 (3d Cir. 2000) (citation omitted). To recover
on a bad faith claim, a claimant is required to show by clear
and convincing evidence that: (1) the defendant insurer did
not have a reasonable basis for denying the policy benefits;
and (2) that the insurer knew or recklessly disregarded its
lack of reasonable basis when it denied the claim.
Rancosky v. Wash. Nat'l Ins. Co., 170
A.3d 364, 365 (Pa. 2017); Post v. St. Paul Travelers Ins.
Co., 691 F.3d 500, 522 (3d Cir. 2012) (citation
actions by an insurer can constitute bad faith, such as
“lack of investigation into the facts[ ] or a failure
to communicate with the insured.” Hamm v. Allstate
Prop. & Cas. Ins. Co., 908 F.Supp.2d 656, 669 (W.D.
Pa. 2012) (citation omitted); Corch Const. Co. v.
Assurance Co. of Am., No. 1250-C, 2003 WL 23473924 (Pa.
Commw. Ct. 2003) (Bad faith may occur “when an
insurance company makes an inadequate investigation or fails
to perform adequate legal research concerning a coverage
issue.”); see also Frog, Switch & Mfg. Co.,
Inc. v. Travelers Ins. Co., 193 F.3d 742, 751 n.9 (3d
Cir. 1999). Every bad faith claim is fact specific and
depends on the “conduct of the insurer vis à
vis the insured.” Condio v. Erie Ins.
Exch., 899 A.2d 1136, 1143 (Pa. Super. Ct. 2006) (citing
Williams v. Nationwide Mut. Ins. Co., 750 A.2d 881,
887 (Pa. Super. Ct. 2000)).
in this Circuit have routinely dismissed bad faith claims
reciting only “bare-bones” conclusory allegations
unsupported by facts sufficient to raise the claims to a
level of plausibility. See, e.g., Smith v. State
Farm Mut. Auto. Ins. Co., 506 Fed.Appx. 133, 136 (3d
Cir. 2012) (unpublished); Ream v. Nationwide Prop. &
Cas. Ins. Co., NAIC, No. 19-00768, 2019 WL 4254059, at
*2-5 (W.D. Pa. Sept. ...