United States District Court, D. South Dakota, Southern Division
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS AND DENYING PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT
LAWRENCE L. PIERSOL, UNITED STATES DISTRICT JUDGE.
Before the Court are cross-motions submitted by Plaintiff Lori Peterson and Defendants (collectively, 'Travelers"). Travelers has moved, pursuant to Federal Rules of Civil Procedure 12(b)(6), to dismiss the Complaint for failure to state a claim. Primarily, Travelers argues that a Commercial Policy (the Policy) issued by Defendant Charter Oak Fire Insurance Company ("Charter Oak") to Billion Empire Motors ("Billion") does not offer coverage to Peterson Alternatively, it argues that even if the Policy does insure Peterson, she failed to notify Travelers per the Policy's requirement. In moving for summary judgment, Peterson requests the Court hold that she was an insured under the Policy and that she was not contractually obligated to notify Travelers of her claim. For the following reasons, Travelers' Motion to Dismiss is granted. Additionally, Peterson's Motion for Partial Summary Judgment is denied.
Peterson was injured in an automobile accident in September 2008 in Minnehaha County, South Dakota. Prior to the accident, Peterson was on a trip from Custer, South Dakota and was the driver o f a "loaner" vehicle, a "2006 Chrysler PT Cruiser, " registered to Billion d/b/a Billion Chrysler-Jeep-Mazda. The passenger in the vehicle, Laura Dziadek, has alleged in a separate action that the accident was caused, at least in part, by Peterson's negligence. All parties have denied liability for the accident. Submissions contained in the record include an accident report that was prepared by police officers responding to the accident. It is undisputed, however, that Peterson herself did not formally notify Travelers of the accident.
At the time of the accident, Peterson had primary coverage under Progressive Northern Insurance Company in the amount of $ 100, 000. The vehicle Peterson was operating as insured under the Policy with Charter Oak. The Policy also named various other affiliates d/b/a 'Travelers". Under the Policy, Travelers agreed to provide insurance through Charter Oak as the named insurer. Based on the Policy, Peterson alleges that she is owed $5, 000 in medical payments as a result of the accident involving the loaned vehicle per the "Common Policy Declarations" (the Declarations).
Charter Oak conducted an investigation after receiving notice of potential loss from Billion's broker in January 2009. Thereafter, Charter Oak contacted Peterson that same month. Charter Oak also contacted Progressive Insurance and was informed of Peterson's $ 100, 000 policy. After Charter Oak commenced its investigation, Peterson, in February 2009, contacted a 'Technical Specialist, " Faith Styles (Styles), in Naperville, Illinois, to inquire about coverage under the Policy. In response, Styles informed Peterson that she was not covered under the Policy and, therefore, was not eligible for medical payments resulting from the accident. As a result, Peterson did not continue her pursuit of medical payments under the Policy until this action was filed on September 12, 2014.
The Federal Rules of Civil Procedure provides that summary judgment shall be entered if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). In ruling on a motion for summary judgment, the Court is required to view the facts in the light most favorable to the non-moving party and must give that party the benefit of all reasonable inferences to be drawn from the underlying facts. AgriStor Leasing v. Farrow, 826 F.2d 732, 734 (8th Cir. 1987). The moving party bears the burden of showing both the absence o fa genuine issue of material fact and its entitlement to judgment as a matter of law. Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986);Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87(1986).
Once the moving party has met its burden, the non-moving party may not rest on the allegations o fits pleadings but must set forth specific facts, by affidavit or other evidence, showing that a genuine issue of material fact exists. Fed.R.Civ.P. 56(e); Anderson, 477 U.S. at 257; City of Mt. Pleasant v. Associated Elec. Co-op., Inc., 838 F.2d 268, 273-74 (8th Cir. 1988). Rule 56(c) "mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial" Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
Failure to State a Claim
In considering a motion under Federal Rule of Civil Procedure 12(b)(6), the factual allegations of a complaint are assumed true and construed in favor of the plaintiff, "even if it strikes a savvy judge that actual proof of those facts is improbable." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556(2007), cited in Data Mfg., Inc. v. United Parcel Serv., Inc., 557 F.3d 849, 851 (8th Cir. 2009). "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 'entitlement to 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). The complaint must allege facts, which, when taken as true, raise more than a speculative right to relief. Id. (internal citations omitted); Benton v. Merrill Lynch &Co., Inc., 524 F.3d 866, 870 (8th Cir. 2008). Although a plaintiff in defending a motion under Rule 12(b)(6) need not provide specific facts in support of its allegations, see Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam), it must include sufficient factual information to provide the grounds on which her claim rests, and to raise a right to relief above a speculative level. Twombly, 550 U.S. at 555-556 & n. 3. Although Federal Rule of Civil Procedure 8 may not require "detailed factual allegations, " it "demands more than an unadorned, the-defendant-unlawtully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). What is demanded to survive a motion to dismiss is facial plausibility. Id. Determining whether a claim has facial plausibility is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679.
I. IS PETERSON A COVERED INSURED UNDER THE INSURANCE POLICY?
The parties agree, as they must, that since this is a federal diversity action, South Dakota substantive law applies. See Bell v. Allstate Life Ins. Co., 160F.3d 452, 455 (8th Cir. 1998) ("State law controls the construction of insurance ...