Opinion
CASE NO. 02-81164-CIV-MIDDLEBROOKS/VITUNAC
February 24, 2004
ORDER
THIS CAUSE comes before the Court upon Defendant New York Life Insurance Company's Motion to Dismiss (DE 42), filed September 12, 2003. Plaintiff filed a Response (DE 45) on October 20, 2003. Defendant's Reply (DE 46) was filed on October 29, 2003. The Court has reviewed the Record and is fully informed in the premises.
Plaintiff brought a class action claim in state court in December 2002. Defendant subsequently removed the case to this Court (DE 1) and shortly thereafter filed a Motion to Dismiss (DE 2). On May 16, 2003, this Court granted Defendant's Motion to Dismiss Without Prejudice (DE 28) allowing Plaintiff the opportunity to file again should she choose to do so. On June 4, 2003, Plaintiff filed an Amended Class Action Complaint (DE 29). Defendant again filed a Motion to Dismiss (DE 30) on June 13, 2003. After the matter was fully briefed, the Court once again granted in part Defendant's Motion to Dismiss (DE 40) on August 11, 2003. Plaintiff filed a Second Amended Complaint (DE 41) on August 29, 2003. Predictably, Defendant filed a Motion to Dismiss (DE 42), which is the Motion now before the Court.
Despite suggestions by the Court and this being the second complaint filed in federal court, Plaintiff continues to bring her class action pursuant to the Florida Rules of Civil Procedure. Plaintiff cites as her reason for doing so that she respectfully disagrees with this Court's Order denying Plaintiff's Motion to Remand, but that it is "respectfully submitted that this Court will apply Fed. Rule 23 in its judicial labors pertaining to this case," Response ¶ 26. Regardless of Plaintiff's agreement or disagreement with the Court's ruling, the case is currently in federal court and accordingly, the Federal Rules of Civil Procedure govern. FED. R. CIV. P. 81(c)), As suggested in the Court's previous Order, "Plaintiff is strongly advised to conduct at least a cursory review of the Federal Rules of Civil Procedure." August 2003 Order at 2 n. 1. The cursory review was not meant to be merely for one's edification. The Federal Rules of Civil Procedure are applicable and should be employed.
Defendant moved to have Plaintiff's Complaint dismissed with prejudice. The Court granted in part dismissing Plaintiff's Complaint without prejudice. August 2003 Order at 4.
In the Court's Order dismissing Plaintiff's Complaint, the Court found that "[a]s no private right of action arises under the Florida Statutes that Plaintiff relies on in her Complaint, she fails to state causes of action under both Counts of the Complaint." May 2003 Order at 5. In the Court's Order dismissing Plaintiff's Amended Complaint, the Court once again cautioned Plaintiff "of the limitation on private rights of action imposed by the Florida Statutes." August 2003 Order at 4. Defendant's Response once again argues that Plaintiff pleads statutory violations that convey no private right of action. Mot. at 6.
Defendant also states that Plaintiff's Complaint cannot state a claim for breach of contract based on a violation of Fla. Stat. § 627.65625 because Defendant is exempt from compliance with this section, however this argument misses Plaintiff's point. Plaintiff alleges that Defendant is not exempt from compliance with Fla. Stat. § 627.65625 based on Defendant's alleged non-compliance with § 627.6515, which for purposes of the motion to dismiss the Court accepts as true.
The facts of the case remain substantially similar to those discussed in the Court's previous orders. However, Plaintiff's pleading has become more detailed. Plaintiff's Second Amended Complaint includes the same counts as in her Amended Complaint, Count I, Beach of Contract, and Count II, Declaratory Judgment. Essentially, Plaintiff claims that because Defendant has violated Fla. Stat. § 627.6515, it has forfeited its out-of-state exemption of Florida governance and therefore must comply with all applicable Florida Statutes. Plaintiff's breach of contract claim alleges that Defendant "violated several Florida Statutes including, but not limited to: Fla. Stat. § 627.6515; Fla. Stat. § 627.6675; Fla. Stat § 627.6571; and Fla. Stat. § 627.65625" all of which she alleges are incorporated into her insurance contract and give rise to her breach of contract claim. Comp. ¶ 25. Plaintiff alleges that as a result of said breach Plaintiff, and other members of the class, suffered monetary loss. Comp. ¶ 26. Count II of Plaintiff's Complaint, seeks a declaratory judgment declaring that Defendant is in violation of Fla. Stat. § 627.6515 and thereby must comply with all applicable portions of Part VII of the Florida Insurance Code. Comp. at 11. Plaintiff further seeks an order that Defendant's "differential premium increases of Standard Plus and Standard Plus 20 insured based on claims history and/or health status violated Florida law." Comp. at 11.
Defendant moves pursuant to FED. R. CIV. P. 8(a)(2), 12(b)(6), and 41(b) to dismiss Plaintiff's claims. Defendant once again argues that no private right of action arises under the Florida Statutes relied upon by Plaintiff. Mot. at 1. Defendants assert that Fla. Stat. § 624.155 enumerates certain statues within Florida's Insurance Code for which there is a private right of action when violated. The statutes relied upon by Plaintiff are not included in that list and therefore are not actionable. Mot. at 6. Defendant further argues that Plaintiff has no standing to bring this action for the following reasons: Plaintiff's coverage remains in force; Plaintiff has not alleged that her rates were raised more than anyone else's in her rating class; and Plaintiff has not alleged an injury in fact from any of the alleged statutory violations. Mot. at 2, 7.
Defendant also notes that even if Plaintiff were entitled to bring a claim pursuant to Fla. Sta. § 624.155, her action cannot be a class action pursuant to Fla. Stat. § 624.155(5). Mot. at 6 fn. 4. The Court finds no need to address this issue as Plaintiff is not bringing her claim pursuant to Fla. Stat. § 624.155.
Plaintiff's Response states that Plaintiff was indeed mindful of the "Court's admonition" in its Order Granting in Part Defendant's Motion to Dismiss Plaintiff's Amended Complaint and accordingly listed various statutory violations in the Second Amended Complaint. Response ¶ 4. Plaintiff alleges that Defendant has breached Plaintiff's contract by violating several Florida Statutes which are by Florida common law incorporated into Plaintiff's contract, including but not limited to Fla. Stat. § 627.6515, Fla. Stat. § 627.6675, Fla. Stat. § 627.6571, and Fla. Stat. § 627.65625. Compl. ¶ 25.
A motion to dismiss is appropriate when it is demonstrated "beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102 (1957). For the purpose of the motion to dismiss, the complaint is construed in the light most favorable to the plaintiff, and all facts alleged by the plaintiff are accepted as true. Hishon v. King Spaulding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232-33, 81 L.Ed.2d 59 (1984). Regardless of the alleged facts, however, a court may dismiss a complaint on a dispositive issue of law. Marshall County Bd. of Educ. v. Marshall County Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993). The issue before the Court is one of law. Accepting Plaintiff's factual allegations as true, does the Plaintiff have a cause of action upon which to seek relief?
The cause of action Plaintiff alleges is a breach of contract. However, a necessary element of the Court's analysis was to evaluate Plaintiff's claim as a private right of action. Accordingly, the Court fulfilled its duty to determine if Plaintiff could obtain relief on any possible theory. See Brooks v. Blue Cross and Blue Shield of Fla., Inc., 116 F.3d 1364, 1369 (11th Cir. 1997).
Plaintiff's pleading has become more detailed, but the legal and factual basis of her Complaint remains the same. The listing of specific statutes does not cure the fact that Plaintiff does not have a legal basis on which to bring her claim. Plaintiff argues that the lack of a private right of action is not dispositive where Florida Statutes are incorporated into Plaintiff's contract with Defendant and accordingly such statutory violations give rise to a breach of contract claim pursuant to Florida common law. The dispositive issue before the Court is if Florida common law supports Plaintiff's argument.
Plaintiff cites numerous state law cases for the proposition that a statute in effect at the time an insurance contract is entered into is a part of the contract. Response ¶ 13-14. In deciding questions of state law, the Court is bound by the determinations of state courts. See Keehn v. Carolina Cas. Ins. Co., 758 F.2d 1522, 1524 (11th Cir. 1985) (citing Hall v. Wainwright, 493 F.2d 37 (5th Cir. 1974)). None of the cases cited by Plaintiff hold that the violation of a statute in effect at the time a contract was entered can be brought as a breach of contract claim. Some of the cases cited by Plaintiff looked to state insurance statutes for definitions of certain terms necessary in contract interpretation. Poole v. Travelers Ins. Co., 179 So. 138 (Fla. 1937); Grant v. State Farm Fire and Cas. Co., 638 So.2d 936 (Fla. 1994). Another case cited by Plaintiff holds that an insured was entitled to broader coverage than the insurer asserted was applicable based on an insurer's failure to include statutorily required language allowing a policy to exclude certain coverage. Gov't Employees Ins. Co. v. Douglas, 654 So.2d 118 (Fla. 1995). Plaintiff also cites a case which held that where an insurance contract included a statute of limitations which allowed an insurer not to pay claims after a certain period conflicted with the mandatory time provisions of a statute, the policy's limitation was invalid. State Farm Mut. Auto. Ins. Co. v. Swearingen, 590 So.2d 506, 508 (Fla. Dist Ct. App. 1991). These cases are not precisely on point. The parties in the present action are not disputing the interpretation of a specific term in their contract or the scope of the contract's coverage.
Plaintiff does cite a Florida Supreme Court case which addresses an issue more analogous to Plaintiff's claim than those discussed above. State Farm Fire and Cas. Co. v. Palma, 629 So.2d 830 (Fla. 1993). In Palma, the issue before the Court was the applicability of a Florida Statute which provided that attorney's fees be paid by an insurer when an insured prevailed on a judgment or appeal. Id. at 832. The Court decided that the statute was applicable where the parties were litigating the issue of entitlement to fees. Id. at 833. Admittedly, the Palma case goes beyond looking to statutes for definitions in contract interpretation or to determine the scope of an insurance contract's coverage. The Court in Palma determined if a statute applied to a particular factual scenario. Palma does not stand for the proposition that any statutory violation of the insurance code can be actionable as a breach of contract claim.
Plaintiff's factual claim is that Defendant has violated various state statutes. Factually, Plaintiff's claim is similar to two Eleventh Circuit cases where the Eleventh Circuit refused to read a private right of action into state laws where state courts and legislatures have not done so. See Swerhun v. Guardian Life Ins. Co. of Am., 979 F.2d 195 (11th Cir. 1992) (refusing to read a private right of action into a Florida Statute regulating health care); See also Keehn v. Carolina Cas. Ins. Co., 758 F.2d 1522 (11th Cir. 1985) (finding plaintiff had no private cause of action for violations of Florida's Unfair Insurance Trade Practices Act by statute's own terms or by incorporation into an insurance contract). In Swerhun and Keehn, the plaintiffs brought a breach of contract claim. Swerhun, 979 F.2d at 198; Keehn, 758 F.2d at 1524. The plaintiff in Keehn brought a cause of action alleging that Defendant violated Florida's Unfair Insurance Trade Practices Act ("UITPA"). See Keehn, 758 F.2d at 1523. In Keehn, the Eleventh Circuit rejected the argument that a plaintiff could bring a breach of contract claim for a violation of UITPA. Id. at 1525. In doing so, the Court considered the statutory scheme of the UITPA as a whole and found that the UITPA intended to provide only an administrative remedy for violations thereof. Id. The UITPA included a section which read in pertinent part "Civil Liability — The provisions of this part [Part VIII, UITPA] are cumulative to rights under the general civil and common law, and no action of the [Insurance] department shall abrogate such rights to damages or other relief in any court." Keehn, 758 F.2d at 1523 (citing Fla. Stat. § 626.9631 (1977)). The section of the Florida Insurance Code at issue in the present case contains a similar provision for civil remedies. Fla. Stat. § 624.155 (2003). Plaintiff argues that Fla. Stat. § 624.155 does not preclude her cause of action. Plaintiff points to Fla. Stat. § 624.155(8) which states in relevant part "[t]he civil remedy specified in this section does not preempt any other remedy or cause of action provided for pursuant to any other statute or pursuant to the common law of this statute . . . " Assuming arguendo, a common law breach of contract claim for statutory violations can be brought pursuant to Florida law, this language does not indicate any legislative intent to preserve such a claim while also providing a civil remedy for the enumerated statutory violations. See Auto-Owners Ins. Co. v. Conquest, 658 So.2d 928 (Fla. 1995) (stating "[s]ection 624.155 is the mechanism by which a person may bring a civil suit against an insurer who violates the Insurance Code . . .) (emphasis added). The Court does not find legal support for Plaintiff's argument or any indication that the legislature intended to allow for such a cause of action.
The issue before the Court in Conquest is the definition of "any person" in Fla. Stat. § 624.155. Conquest, 658 So.2d at 929. The Court did note that it had already decided that Fla. Stat. § 624.155 provided remedies for first party actions. Id. (citing State Farm Mutual Auto. Ins. Co. v. Laforet, 658 So.2d 55 (Fla. 1995)). Interestingly, the Plaintiff in Laforet brought a claim pursuant to Fla. Stat. § 624.155 instead of a breach of contract claim.
Plaintiff's counsel asserts that they are involved in similar litigation where defendant insurers have argued there is no private right of action and Florida circuit judges have rejected this argument. Plaintiff's counsel refers to two cases in particular, Wallant and Addison. Wallant v. Freedom Life Ins. Co. of Am., Case No. CA 01-07648-AD in the Fifteenth Judicial Circuit in and for Palm Beach County, Florida and Addison v. American Medical Security, 2002 WL 1454102 (Fla.Cir.Ct. 2002). Neither case, as Plaintiff correctly points out, is binding precedent on the Court. Furthermore, the Wallant litigation is still pending. It is in the class certification stage. Plaintiff attached the Addison opinion from the Florida Circuit Court which found liability against a defendant insurer for statutory violations. P1. Response Exh. B.6. Given the reluctance to find private rights of action for statutory violations absent clear legislative intent to do so, the Court is reluctant do so based upon one state trial court opinion.
While the Court is bound by the liberal pleading standards at the motion to dismiss stage of litigation, "bald assertions and conclusions of law will not defeat a properly supported motion to dismiss." Ham v. Don Mealy Imports, Inc., 285 F. Supp.2d 1297, 1301 (M.D. Fla. 2003) (citing Leeds v. Metlz, 85 F.3d 51 (2d Cir. 1996)). Pursuant to FED. R. CIV. P. 12(b)(6) a claim can be dismissed on a dispositive issue of law. Burger King Corp. v. Holder, 844 F. Supp. 1528, 1529 (S.D. Fla. 1993) ( citing Neitzke v. Williams, 400 U.S. 319, 325 (1989)). Courts are generally reluctant to grant a dismissal on a FED. R. CIV. P. 12(b)(6) motion. However, the Court allowed Plaintiff two chances to amend, both times informing Plaintiff of her Complaint's deficiency. See Friedlander v. Nims, 755 F.2d 810, 813 (11th Cir. 1985). Plaintiff has had ample opportunity to cure the deficiency of her Complaint and yet the deficiency is still present. Plaintiff cannot go forward on a legal basis for which there is no clear support.
Based on the foregoing, it is hereby
ORDERED AND ADJUDGED that
1. Defendant's Motion to Dismiss with Prejudice Plaintiff's Second Amended Complaint (DE 42) is GRANTED;
2. Plaintiff's Second Amended Complaint is DISMISSED WITH PREJUDICE;
3. The Clerk of Court shall CLOSE this case; and
4. All pending motions are DENIED as MOOT.
Including the Parties' Unopposed Motion to Stay Pretrial Deadlines (DE 47).
DONE AND ORDERED.