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Lawrence Cross v. State Farm Insurance Company

October 17, 2011


The opinion of the court was delivered by: Thomas J. McAVOY, Senior United States District Judge



Plaintiff Lawrence Cross ("Plaintiff") commenced this action pro se, asserting claims arising from an injury he suffered on October 2, 2007 "when a 2004 Toyota Camry Solara suddenly and unexpectedly accelerated striking plaintiff." See 2nd Am. Compl. ¶ 11, dkt. # 36. Plaintiff's claims against Toyota Motor Corp. and Toyota Sales, U.S.A., Inc. have been severed from his claims against State Farm Mutual Automobile Insurance Company ("State Farm")*fn1 and transferred to the Central District of California by the United States Judicial Panel on Multidistrict Litigation. See 04/26/11 JPMDL Order, dkt. # 26. In a June 7, 2011 Decision & Order, dkt. # 20,*fn2 the Court granted State Farm's motion to dismiss three of Plaintiff's five claims against it, as well as Plaintiff's demand for punitive damages. Id. In doing so, the Court granted Plaintiff leave to re-plead his claims against State Farm. Id.

Plaintiff thereafter filed a Second Amended Complaint in which he alleges, inter alia,*fn3 multiple causes of action against State Farm including his demand for punitive damages. See 2nd Am. Compl., dkt. # 36. Presently before the Court is State Farm's motion to dismiss the majority of these claims and the demand for punitive damages. See Motion, dkt. # 44. Plaintiff has opposed the motion and requests leave to amend his complaint a third time. See Opp., dkt. # 57. State Farm has filed a reply to Plaintiff's opposition and has opposed Plaintiff's request to file a third amended complaint. See Reply, dkt. # 58. For the reasons that follow, State Farm's motion is granted, and Plaintiff's request to file a third amended complaint is denied.


"Federal Rule of Civil Procedure 8(a)(2) requires only 'a short and plain statement of the claim showing that the pleader is entitled to relief,' in order to 'give the defendant fair notice of what the . . . claim is and the grounds upon which it rests.'" Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955, 1964 (2007)(quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S. Ct. 99 (1957)). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations . . . a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id. at 1964-65. "Factual allegations must be enough to raise a right to relief above the speculative level. . . on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Id. at 1965. "'[T]he pleading must contain something more . . . than . . . a statement of facts that merely creates a suspicion [of] a legally cognizable right of action.'" Id. at 1965 (quoting 5 C. Wright & A. Miller, Federal Practice and Procedure § 1216, pp. 235-236 (3d ed. 2004)). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009)(quoting Twombly, 550 U.S. at 570). A complaint does not suffice "if it tenders naked assertions devoid of further factual enhancement." Ashcroft, 129 S. Ct. at 1949. Legal conclusions must be supported by factual allegations. Iqbal, at 1950. "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. at 1949. "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." Id. "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. 557) (internal quotations omitted). Although a court must liberally construe the allegations in a complaint drafted by a pro se litigant, see e.g.Boddie v. Schnieder, 105 F.3d 857, 860 (2d Cir. 1997), a pro se litigant is not excused from these pleadings requirements. Liberality in interpreting the pleadings "does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions. . . . [O]nly a complaint that states a plausible claim for relief survives a motion to dismiss." Iqbal, at 1950.


a. Breach of Covenant of Good Faith and Fair Dealing

Plaintiff alleges a breach of the covenant of good faith and fair dealing against State Farm. 2nd Am. Compl. ¶¶ 34-38. The allegations underlying this claim are essentially the same as those alleged in the same claim in the Amended Complaint. In dismissing this claim previously, the Court wrote:

[T]he [covenant of good faith and fair dealing] is implied in every contract and, therefore, the claim is duplicative of the breach of contract claim . . . . R.I. Island House, LLC v. North Town Phase II Houses, Inc., 51 A.D.3d 890, 896 (2d Dep't 2008); Grazioli v. Encompass Ins. Co., 40 A.D.3d 696, 697 (3d Dep't 2007); see also Paterra v. Nationwide Mut. Fire Ins. Co., 38 A.D.3d 511, 512-513 (2d Dep't 2007)(claim predicated on alleged breach of implied duty of good faith is duplicative of breach of contract claim). Moreover, an independent claim that an insurer breached the implied covenant of good faith and fair dealing cannot be sustained unless there is an underlying, independent tort sufficient to support a claim that the insurer engaged in egregious conduct directed to Plaintiff and which was part of a pattern directed to the public generally. See New York Univ. v Continental Ins. Co., 87 N.Y.2d 308, 319-20 (1995); Fabrizio v. Erie Ins. Co., 2009 U.S. Dist. LEXIS 13344, at *12 (N.D.N.Y. 2009). 6/7/11 Dec. & Ord., pp. 2-3.

All of the allegations against State Farm in the Second Amended Complaint concern State Farm's handling of the insurance policy under which Plaintiff claims benefit. Plaintiff has not asserted specific conduct separate and apart from the handling of the insurance policy, nor has he asserted plausible claims of egregious conduct directed to Plaintiff and which was part of a pattern directed to the public generally. Therefore, the motion to dismiss the breach of the covenant of good faith and fair dealing claim, 2nd Am. Compl. ¶¶ 34-38, is granted. Plaintiff's challenge to State Farm's decision to deny coverage can be litigated in the context of Plaintiff's breach of contract claim, 2nd Am. Compl., ¶ 40, which is not challenged on this motion.

b. Punitive Damages

Plaintiff again seeks punitive damages as part of his breach of contract claim. See 2nd Am. Compl., ¶ 41. He also presents an independent claim for punitive damages based upon State Farm's "delays in handling, responding, paying, and conduct in general" related to his policy claims. 2nd Am. Compl. ¶ 80; see id. ¶¶ 75-84. As the Court explained previously:

Under New York law, punitive damages are not recoverable unless such damages are "necessary to deter defendant and others like it from engaging in conduct that may be characterized as 'gross' and 'morally reprehensible,' and of 'such wanton dishonesty as to imply a criminal indifference to civil obligations.'" New York Univ., 87 N.Y.2d at 316. Thus, to recover punitive damages, the plaintiff must allege an "egregious tort directed at the public at large." Steinhardt Group, Inc. v. Citicorp, 272 A.D.2d 255, 257 (1st Dep't 2000); see International Plaza Assoc., L.P. v. Lacher, 63 AD3d 527, 528 (1st Dep't 2009 (Punitive damages are not recoverable in a breach of contract action in which no public rights are alleged to be involved.); Goldsmith Motors Corp. v. Chemical Bank, 41 A.D.3d 648, 649 (2d Dep't 2007) (no punitive damages where wrong complained of was essentially private, not public); Fulton v. Allstate ...

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