Juarez et al v. Nationwide Property And Casualty Insurance Company et al, No. 4:2010cv02726 - Document 14 (S.D. Tex. 2010)
Court Description: MEMORANDUM AND ORDER granting 3 MOTION to Dismiss (Partial).(Signed by Judge Ewing Werlein, Jr) Parties notified.(kstrouse, )
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IN THE UNITED STATES D ISTRICT COURT FOR THE SOUTHERN D ISTRICT OF TEXAS HOU STON D IV ISION JOSE DE JESUS JUAREZ and MARIA RAMOS, Plaintiffs , CIVIL ACTION NO . H-10-2726 NATIONW IDE PROPERTY AND CASUALTY INSURANCE COMPANY , CUSTARD INSURANCE ADJUSTERS, INC ., KENT LEE STRICKLXND , and MELINDA MOLLY SEIGLER , Defendants . MEMORANDUM AND ORDER Pending is Defendants Nationw ide Property and Casualty Insurance Company's, Custard Insurance Adjusters, Inc.rs, Kent Lee Strickland 's, and Melinda Molly Dismissal Under Rule ( Document No. Seigler 's Motion for Partial of the Federal Rules of Civil Procedure , A fter having reviewed the motion , responses , and the applicable law , the Court concludes as follows . 1. Backqround This is a Hurricane Ike insurance dispute . Plaintiffs Jose de Jesus Juarez and Maria Ramos ( uplaintiffs') allege that their home ' Juarez et al v. Nationwide Property And Casualty Insurance Company et al Doc. 14 was severely damaged by the hurricane , including partial roof collapse and loss of several shingles x Document No. Dockets.Justia.com ex. 1 at Additionally , they allege ( Plaintiffs' Orig. Pet.). that water seeping from the damaged roof caused significant damage to the walls, insulation , flooring , electronics and app liances. Plaintiffs are the named insureds on their homeowner's insurance policy , issued by Defendant Nationw ide Insurance Company ( nNationwider) ' Property and Casualty Plaintiffs filed a claim with Nationwide, and Nationw ide assigned Defendant Custard Insurance Adjusters ( ucustard' to adjust the claim. Defendants Melinda ') 3 Molly Seigler l' 'seigler' and Kent Lee Strickland ( 'l nstrickland') ' were the individual adjusters who came to the property to inspect the damage and adjust the c1aim . Plaintiffs allege that Seigler 4 and Strickland performed perfunctory inspections of their property , spending only 10 or 15 minutes each, and did not climb up on the partially collapsed roof to assess the damage .s Plaintiffs bring this action against a11 Defendants for violations of the Texas Insurance Code , common law fraud, and conspiracy to commit fraud . Additionally , Plaintiffs assert that Nationwide breached the insurance contract and its duty good faith and fair dealing .6 non- Defendants move contractual claims, including consp iracy 2 Id . Id . at 5 . Id . Id . at 5. 6 Id . at 13-16 . 2 dismiss commit fraud , and claims under the Texas Insurance Code , against all Defendants, under Federal Rule of Civil Procedure 9( 7 Plaintiffs argue that b). they have met the standard set forth Rule 9 ( for the fraud b) claims , and that the other claims need not meet the exacting standard of Rule 9 ( b) Alternatively, Plaintiffs request leave to amend their pleadings order to comply with Rule 9( b). Rule 9 ( Standard b) A motion to dismiss for failure to plead with particularity as required by Rule 9 ( b) is treated as a Rule 12 ( 6) motion to b)( dismiss for failure to state a claim . Soectrum , Inc w 78 F. 3d 1015, 1017 ( 5th Cir . 1996); Camoa v. Nationwide Prop . and Cas . Ins . Co ., Civ . 3733469, at *1 ( D. Tex . Sept. S. Rule Lovelace v . Software No . 10-2707, 2010 WL 2010). requires that nE iln alleging fraud or mistake, a party must state w ith particularity the circumstances constituting fraud or mistake.' ' FED. 9( b). Although the exact pleading requirements for Rule 9( are case-specific, see Guidrv b) v . Bank of Laplace, 954 F.2d 288 ( 5th Cir . 1992), the Fifth Circuit 'requires that the plaintiff allege 'the particulars of ' time , place , and contents of the false representations,' as well as the identity of the person making the misrepresentation and what that person obtained thereby , otherwise referred to as the %who , Do cum en t N o . at what , when , where, and how ' of the alleged fraud .' ' U .S . ex rel. Willard v . Humana Health Plan of Tex ., Incw 336 F.3d 375, 384 ( 5th 2003) ( citations omitted). 111 . Discussion Fraud and Consoiracv to Comm it Fraud In their common law fraud claim , Plaintiffs allege : ! 49: Eac and e h very one of the representati ons, as described above, concerned material facts for the reason that absent such representations, Plaintiffs would not have acted as they did , and which Defendants Nationw ide, Custard , Strickland , and Seidler knew were false or made recklessly without any knowledge of their truth as a positive assertion . !50: The statements were made with the intention that they should be acted upon by Plaintiffs, who in turn acted in reliance upon the statements, thereby causing Plaintiffs to suffer injury and constituting common law fraud .8 Plaintiffs' pleading , however, specifies no representation or alleged misrepresentation that Plaintiffs claim to have relied upon or that caused them to 'act E as they did.' The petition fails to ' ) ' state the substance of any alleged misrepresentations constituting the alleged fraud , much less exactly NAo made them , Aow they were 8 D ocum ent No . ex . 1 at 12 . 4 made , ehen they were made , to wAom they were made , and wAere they were made . See Willard, 336 F .3d at 384 . Likewise , Plaintiffs ' claim of consp iracy to commit fraud is purely formulaic and conclusory , also failing to meet the require- ments of Rule 9( b) The motion to dismiss al1 allegations of fraud and conspiracy to commit fraud for failure to comply with Rule 9( b) is meritorious . B. Texas Insurance Code Claims Normally, ' rlule 9( 'E b)'s stringent pleading requirements should not be extended to causes of action not enumerated therein .' ' Am . Realtv Trust , Inc . v . Hamilton Lane Advisors, Inc ., 115 App' 662, 668 ( x 5th Cir. 2004) see also Kennard v . IndianaDolis Life Ins. Co., 420 F. Supp . 601, 609 ( . Tex. 2006) ( zd N D. Fish, ( citations omitted) ( holding that Rule 9( b) did not apply to pleadings for Texas Insurance Code claims when no separate fraud claims were alleged). However, when the fraud and misrepresentation claims are based on the same set of alleged facts , and no distinction is made between the claims, the Fifth Circu it has applied the heightened pleading requirements of Rule 9( b). See Benchmark Elec., Inc., v . J . Huber Corpw 343 F.3d 719, 723 ( M. 5th Cir. 2003)7 Williams v. WMX Techs., Incw F.3d 175, ( 5th Cir. 1997); see also Berrv v . Indianarolis Life Ins. Co ., 6O8 Supp . zd 785, 800 ( . . Tex . 2009) ( N D holding that the heightened 5 pleading standard of Rule 9 ( applied to Texas Insurance Code b) claims where the allegations of m isrepresentations were based on the same facts as the fraud claims). The question is whether the non-fraud claims are M so intertwined ' w ith the fraud averments that it is not possible to describe a simp le redaction to separate the two .' Kennard , 42O F . Supp .zd at 609 . ' Here, Plaintiffs ' Texas Insurance Code claims are a11 'inter' twined' with the general allegations of fraud and conspiracy ' commit fraud claims, all of which are found in the same conclusory nFacts' section of the petition . ' Plaintiffs' structure of its petition therefore precludes any nsimp le redaction to separate the two .' See Kennard , 420 F . Supp .zd at 609 . Accordingly , the motion ' to dismiss has merit , although Plaintiffs will be given an opportunity to replead their claims under the Texas Insurance Code and , as well , their claims fraud such claims can be made consistent with the requirements of Rules 11( and 9( b) b). IV . Order For the foregoing reasons, it is ORDERED that Defendants Nationwide Property and Casualty Insurance Company, Custard Insurance Adjusters, Inc., Kent Lee Strickland , and Melinda Dismissal Under Rule ( Document No. Molly Seigler 's Motion for Partial of the Federal Rules of Civ il Procedure , GRANTED, and 6 non-contractual claims shall be DISM ISSED without further Order of the Court unless Plaintiffs, within 14 days after the date of this Order, file a more definite statement in the form of an Amended Complaint that fully complies with Rules 9( b), and 11 ( 9 b). The Clerk will enter this Order , providing a correct copy to all parties of record . SIGNED at Houston , Texas, on this ay of December, 2010. < * EWI UNITED S * WERLEIN , JR . TES DISTRICT JUDGE 9 The Court observes that the attorneys for Plaintiffs in this case appear routinely and with no specificity to have alleged nfraud' and 'conspiracy to commit fraud' in case after case that ' ' ' the Court has now had opportunity to examine . The requirements of Rule 9 ( have been stated above and need not be repeated . b) The Court cautions Plaintiffs , however , that when siqninq a pleadinq in this Court, counsel also is makinq al1 of the reoresentations to the Court that are set out in Rule 11 ( . b)
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