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Jones v. Colorado Casualty Insurance Co.

United States District Court, Ninth Circuit

September 4, 2013

Anthony Jones, Plaintiff,
v.
Colorado Casualty Insurance Co.; Trudy A. Spratta, XYZ Corps.; John Does 1-26, Defendants.

ORDER

JAMES A. TEILBORG, Senior District Judge.

Pending before the Court is Co-Defendant Trudy Spratta's ("Defendant" or "Spratta") Motion to Dismiss Plaintiff's claims against her. (Doc. 8). Plaintiff has filed a Response (Doc. 10) and Spratta has filed a Reply (Doc. 11). The parties have requested oral argument on the pending motion, however, because both the parties submitted memoranda discussing the law and evidence in support of their positions, because the Court has addressed this exact issue recently in Young v. Colorado Casualty Group, Inc., CV-12-2302-PHX-JAT, 2013 WL 840618 (D. Ariz. Mar. 6, 2013), and because oral argument would not have aided the Court's decisional process, the Court will not grant oral argument concerning this matter. See e.g., Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998); Lake at Las Vegas Investors Grp., Inc. v. P. Dev. Malibu Corp., 933 F.2d 724, 729 (9th Cir. 1991). The Court grants Spratta's motion for the following reasons.

I. BACKGROUND

Plaintiff Anthony Jones suffered an on-the-job injury and filed a claim with Defendant Colorado Casualty Insurance Company ("Colorado Casualty") for worker's compensation benefits. Spratta handled Jones' worker's compensation claim as Colorado Casualty's claims adjuster. Although he eventually received at least some of the benefits to which he was entitled, Jones experienced a great deal of difficulty working with Colorado Casualty.

Jones brought this action in Arizona state court by filing a complaint (the "Complaint") alleging a breach of the duty of good faith and fair dealing that resulted in wrongfully denied and unreasonably delayed benefit payments. (Doc. 1-1). Jones named Colorado Casualty and Trudy Spratta as defendants, as well as several fictitious John Does and XYZ Corporations. ( Id. at 2-4). Colorado Casualty removed the action to this Court based on diversity of the parties. (Doc. 1).

The Complaint Jones filed alleges three claims for relief. The first claim is alleged only against Colorado Casualty for breach of the duty of good faith and fair dealing. (Doc. 1-1 at 8-10). The second claim is alleged only against Spratta for aiding and abetting Colorado Casualty's breach of the duty of good faith and fair dealing. ( Id. at 10-11). The third claim[1] alleges both Defendants are liable for punitive damages. ( Id. at 11-12). The Complaint alleges Colorado Casualty is vicariously liable for the acts of its employees or agents such as Spratta, and that Colorado Casualty is directly liable for a breach of the duty of good faith and fair dealing. ( Id. at 3-4, 8-10). As for Spratta, the Complaint alleges only that she is "personally liable for her own acts and omissions insofar as she aided and abetted Defendant COLORADO CASUALTY in its violations of the Arizona Worker' [sic] Compensation Act and the duties of good faith and fair dealing owed to Mr. Jones." ( Id. at 4). The only factual allegations in the Complaint are that an adequate investigation was not conducted and that Jones' claims for payment were delayed and denied without any reasonable basis. ( Id. at 5-7).

Spratta filed the pending Rule 12(b)(6) Motion to Dismiss. (Doc. 8). Spratta argues she should be dismissed from this lawsuit because her actions are the sole basis for Plaintiff's claims against Colorado Casualty, and she took those actions as Colorado Casualty's agent. Even if Colorado Casualty breached its duty of good faith and fair dealing via Spratta's actions, she argues, one actor performing one set of actions cannot simultaneously form the basis for both primary and secondary liability. In other words, Spratta argues one cannot aid and abet one's self.

II. ANAYSIS

A. Federal Pleading Requirements

The Court may dismiss a complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) for two reasons: (1) lack of a cognizable legal theory; or (2) insufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990). To survive a 12(b)(6) motion for failure to state a claim, a complaint must meet the requirements of Federal Rule of Civil Procedure 8(a)(2). Rule 8(a)(2) requires a "short and plain statement of the claim showing that the pleader is entitled to relief, " so that the defendant has "fair notice of what the... claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).

Although a complaint attacked for failure to state a claim does not need detailed factual allegations, the pleader's obligation to provide the grounds for relief requires "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555 (internal citations omitted). Rule 8(a)(2) "requires a showing, ' rather than a blanket assertion, of entitlement to relief. Without some factual allegation in the complaint, it is hard to see how a claimant could satisfy the requirement of providing not only fair notice' of the nature of the claim, but also grounds' on which the claim rests." Id. (citing 5 C. Wright & A. Miller, Federal Practice and Procedure ยง1202, pp. 94, 95 (3d ed. 2004)). Thus, Rule 8's pleading standard demands more than "an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 555).

In deciding a motion to dismiss under Rule 12(b)(6), the Court must construe the facts alleged in the complaint in the light most favorable to the drafter of the complaint and the Court must accept all well-pleaded factual allegations as true. See Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000). Nonetheless, the Court does not have to accept as true a legal conclusion couched as a factual allegation. Papasan v. Allain, 478 U.S. 265, 286 (1986).

B. A Secondary Act is Required to Aid and Abet a Primary Act

In his first claim, Plaintiff alleges Colorado Casualty breached its duty of good faith and fair dealing via the actions of Spratta, who was acting as Colorado Casualty's claims adjuster. For purposes of this Motion, the Court accepts that allegation as true. His second claim alleges that Spratta, in her individual capacity, aided and abetted Colorado Casualty in breaching its duty of good faith and fair dealing to Jones. In order to state a claim against Spratta, ...


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