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Bierman Family Farm, LLC v. United Farm Family Insurance Co.

United States District Court, D. Maryland

July 13, 2017

BIERMAN FAMILY FARM, LLC./ KING MULCH/KING FARMS, Plaintiff(s),
v.
UNITED FARM FAMILY INSURANCE COMPANY, Defendant.

          MEMORANDUM

          A. David Copperthite United States Magistrate Judge.

         This Memorandum Opinion addresses the Motion to Dismiss Claim of Bad Faith (ECF No. 17) filed by Defendant United Farm Family Insurance Company ("Defendant") against Plaintiffs Bierman Family Farm, LLC, King Mulch, and King Farms (collectively, "Plaintiffs"). On January 3, 2017, Plaintiffs filed suit in the Circuit Court for Harford County against Defendant alleging one count of breach of contract for failure to fully pay the amounts due under an insurance contract between Plaintiff Bierman and Defendant United Farm Family Insurance Company. ECF No. 2 (hereinafter "the Complaint").[1] On January 22, 2017, Defendant filed a Motion to Dismiss Claim of Bad Faith (hereinafter "the Motion to Dismiss"). ECF No. 17. On February 22, 2017. Plaintiffs filed an opposition to Defendant's Motion to Dismiss. ECF No. 19. On March 1. 2017, Defendant filed a reply to Plaintiffs' opposition. ECF No. 21.

         This matter is now fully briefed.[2] Upon review of Defendant's Motion to Dismiss, Plaintiffs' Response, and Defendant's Reply, the Court finds no hearing is necessary. See Local Rule 105.6. For the reasons stated herein, the Court GRANTS Defendant's Motion to Dismiss Claim of Bad Faith.

         I. Factual Background

         This lawsuit arises out of Defendant United Farm Family's denial of Plaintiff Bierman's insurance claim for the alleged damage to a storage building on the property located at 33819 Market Street, Pokomoke City, Maryland 21851 (hereinafter "the Property"). On or about October 13, 2015, Plaintiff Bierman and Defendant entered into a contract of insurance (Policy No. 1913G1126) (hereinafter "the Policy") providing coverage on the Property for the time period from November 17, 2015 through November 17. 2016. ECF No. 17-2. The Policy provided for a maximum coverage of $200, 000 for the storage building located at the Property. In addition to that maximum, the Policy provided for up to $10, 000 for debris removal and up to $10, 000 for law and ordinance coverage.[3] Id.

         On April 10, 2016, "the Property sustained a fire loss" ECF No. 2 at 2. As a result, Plaintiffs "made a claim with the Defendant for the resulting property damage by way of Claim Number 19-G-3A9171" claiming costs in excess of the $200, 000 policy limit for replacement of the Property as well as estimates in excess of $10, 000 for debris removal. Id. at 3. Thereafter. Defendant partially denied Plaintiffs claim, paying $105, 000 or one half of the total coverage for damage and debris removal at the Property based on the application of a Vacancy and Unoccupancy Clause contained in the Policy.[4]

         Plaintiffs' Complaint alleges a single count of breach of contract for failure to fully pay the amounts due under the Policy. Specifically, Plaintiffs contend that, "[Defendant] improperly applied a 50% vacancy penalty, even though the Storage Building was not vacant under the definitions of the policy." Id. The Complaint seeks $220, 000 in damages with interests and costs for the alleged breach as well as a declaratory judgment of Defendant's bad faith. ECF No. 2. Defendant now moves to dismiss the claim of bad faith outlined in paragraph 19 of the Complaint for failure to state a claim. ECF No. 17.

         II. Standard of Review

         "The purpose of a Rule 12(b)(6) motion [to dismiss] is to test the sufficiency of a complaint." McBurney v. Cuccinelli, 616 F.3d 393, 408 (4th Cir. 2010) (internal citation omitted). To survive a Rule 12(b)(6) motion, a complaint must satisfy the pleading standard articulated in Fed.R.Civ.P. 8(a)(2), which requires a "short and plain statement of the claim showing that the pleader is entitled to relief." The purpose of the rule is to provide the defendant with "fair notice" of the claim and the "grounds" for entitlement to relief. Bell All. Corp. v. Twombly, 550 U.S. 544, 555-56 & n.3 (2007). That showing must consist of more than "a formulaic recitation of the elements of a cause of action" or "naked assertion[s] devoid of further factual enhancement." Ashcroft v. Iubal. 556 U.S. 662, 678 (2009) (internal citations omitted); see Painter's Mill Grille. LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013).

         To survive a Rule 12(b)(6) motion to dismiss, a complaint must set forth "a claim to relief that is plausible on its face." Ashcrofi v. Iqbal, 556 U.S. 662, 678 (2009); Bell All. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). When ruling on a motion to dismiss under Fed.R.Civ.P. 12(b)(6), a court is required to "accept the well-pled allegations of the complaint as true" and "construe the facts and reasonable inferences derived therefrom in the light most favorable to the plaintiff." Ibarra v. United States, 120 F.3d 474, 474 (4th Cir. 1997); see also Nemet Chevrolet, Ltd. v. Consumeraffairs.com. Inc., 591 F.3d 250, 255 (4th Cir. 2009) ("in evaluating a 12(b)(6) motion to dismiss, a court accepts all well-pled facts as true and construes these facts in the light most favorable to the plaintiff in weighing the legal sufficiency of the complaint."). However, the court need not accept unsupported or conclusory factual allegations. United Black Firefighters v. Hirst, 604 F.2d 844. 847 (4th Cir. 1979); see also Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009). Nor must it accept legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 678. Thus, dismissal is appropriate where "accepting as true the well-pled facts in the complaint and viewing them in the light most favorable to the plaintiff, the plaintiff is unable to 'state a claim to relief that is plausible on its face" Brockington v. Boykins. 637 F.3d 503, 505-06 (4th Cir. 2011) (citing Twombly, 550 U.S. at 570)).

         In sum, to survive a motion to dismiss, the factual allegations of a complaint "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)." Twombly, 550 U.S. at 555 (internal citations omitted). Thus, a complaint must contain sufficient factual detail to "nudge [Plaintiffs'] claims across the line from conceivable to plausible." Twombly, 550 U.S. at 570. If the "well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct." the complaint has not shown that "'the pleader is entitled to relief."' Iqbul 556 U.S. at 679 (citing Fed.R.Civ.P. 8(a)(2)).

         III. Discussion

         a. Plaintiffs' Argument that Defendant's Motion to Dismiss Has Been Waived

         This Court first addresses Plaintiffs' claim that Defendant's Motion to Dismiss has been waived. Plaintiffs argue that a motion to dismiss is not proper at this stage and should have been raised prior to the filing of ...


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