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Arvon v. Liberty Mutual Fire Insurance Co.

United States District Court, D. Maryland

September 6, 2019

BIEJAN ARVON, Plaintiff,
LIBERTY MUTUAL FIRE INSURANCE CO. Defendant/Third-Party Plaintiff,


          Beth P. Gesner Chief United States Magistrate Judge.

         Currently pending is defendant/third-party plaintiff Liberty Mutual Fire Insurance Company's (“defendant”) Motion for Summary Judgment as to Counts II and III of Plaintiff Arvon's Complaint (“Motion”) (ECF No. 99), plaintiff Biejan Arvon's (“plaintiff”) Response in Opposition to Defendant/Third-Party Plaintiff Liberty Mutual Fire Insurance Company's Motion for Summary Judgment (“Opposition”) (ECF No. 113), and defendant's Reply to Plaintiff Arvon's Opposition to Motion for Summary Judgment (“Reply”) (ECF No. 117).[1] The issues are fully briefed, and no hearing is necessary. Loc. R. 105.6. For the reasons stated below, defendant's Motion (ECF No. 99) is GRANTED.

         I. BACKGROUND

         On July 8, 2011, plaintiff was driving a vehicle owned by Ethel Mae Campbell (“Ms. Campbell”), a customer of plaintiff's automobile repair shop, with her permission, when he was rear-ended by Alireza Gol (“Mr. Gol”). (ECF No. 99-1 at 7). Mr. Gol was operating a vehicle owned by Hamed Khodaparasti Dehboneh (“Mr. Khodaparasti”), with Mr. Khodaparasti's permission. (Id. at 7). Mr. Khodaparasti was also a passenger in the vehicle at the time of the accident. (ECF No. 113 at 2). Prior to the accident, Mr. Khodaparasti, “a recent immigrant to the United States, with no credit or employment history, obtained the assistance of his friend and roommate Puya Shakiba to purchase the vehicle and obtain insurance for the vehicle through Liberty Mutual Insurance Company.” (ECF No. 99-1 at 7). Mr. Khodaparasti and Puya Shakiba (“Mr. Shakiba”) purchased the insurance policy through S.M. Mirjifari, a sales representative for defendant, “with whom Mr. Shakiba was acquainted through weekend pickup soccer games.” (Id.)

         On July 10, 2011, “someone called [defendant's] Claims Call Center and reported the accident on behalf of Messrs. Khodaparasti and Gol, both of whom did not speak English.” (ECF No. 99-1 at 8). On July 11, 2011, plaintiff's bodily injury claim was assigned to claims representative Vermeka Lang (“Ms. Lang”), who spoke with Mr. Gol or Mr. Khodaparasti, who informed her about the details of the incident.[2] (Id.; ECF No. 113 at 4). Ms. Lang also spoke with someone at plaintiff's house who advised that plaintiff was in the hospital. (ECF No. 99-1 at 8). That same day, Senior Claims Representative Christine Fletcher (“Ms. Fletcher”) completed her bodily injury coverage analysis of the claim. (ECF No. 99-1 at 8). Defendant then accepted coverage for the accident and found that “Mr. Gol was covered under the policy as a permissive user” and that “Mr. Gol was one hundred percent at fault; and accepted liability for the accident.” (Id. at 9). On July 8, 2011, defendant issued payment for the repair of Ms. Campbell's car. (Id.) On July 13, 2011, Ms. Lang spoke to plaintiff, who was still in the hospital, about his accident and his injuries. (Id.) Similarly, on July 20, 2011, defendant issued payment for the repair of Mr. Khodaparasti's car. (Id.) Plaintiff's bodily injury claim remained unresolved, however, and as of December 5, 2011, Ms. Fletcher assumed the handling of this claim.[3] (Id.) Ms. Lang and Ms. Fletcher sent several letters to plaintiff regarding his claim between 2011 and 2013. (Id. at 10). Each of these letters included a subject line that stated “Insured: Puya Shakiba.” (Id.)

         On August 30, 2013, Ms. Fletcher called plaintiff and spoke to his wife, who advised that plaintiff had retained counsel. (Id.) On September 16, 2013, Marc Seldin Rosen (“Mr. Rosen”) “faxed a letter of representation to Ms. Fletcher, advising that he was collecting Mr. Arvon's medical records and would be in a position to discuss resolution soon.” (Id. at 11). Ms. Fletcher left messages for Mr. Rosen on October 2 and 22, 2013, to discuss the status of the case. (Id.) Ms. Fletcher also sent a letter to Mr. Rosen requesting an update on November 26, 2013. (Id.) This letter also bore the subject line “Insured: Puya Shakiba.” (Id.) Ms. Fletcher left Mr. Rosen another message on January 6, 2014, as did her colleague, Larry Connor, on February 7, 2014. (Id. at 11- 12). Ms. Fletcher reached Mr. Rosen by telephone on March 26, 2014, and Mr. Rosen advised that he would be sending a demand package soon. (Id. at 12). On May 9, 2014, Ms. Fletcher sent Mr. Rosen another letter, with the same subject line, asking when she could expect the demand package. (Id.)

         On June 2, 2014, Mr. Rosen sent a demand letter, with the subject line “Your Insured: Puya Shakiba.” (Id.) In this letter, Mr. Rosen stated “[a]s you know, your insured, Puya Shakiba, rear ended Mr. Arvon on July 8, 2011.” (ECF No. 113 at 4-5 (quoting ECF No. 113-9 at 2)). This demand letter was received by defendant by June 5, 2014 and marked as “organized and reviewed by June 12, 2014.” (Id. at 16). Ms. Fletcher also viewed the claim file on June 6, 2014. (Id. at 4- 5). On June 23, 2014, Mr. Rosen filed suit in the Baltimore County Circuit Court, and emailed Ms. Fletcher on June 27, 2014 to inform her that he had filed suit, but that he did not want to serve it, if doing so was unnecessary. (Id. at 5-6). The complaint in that case named Puya Shakiba as the defendant, and Mr. Rosen's June 27 email included a subject line “Biejan Arvon v. Puya Shakiba . . . .” (ECF No. 99-1 at 12). Ms. Fletcher did not respond to this email, and Mr. Rosen emailed her again on July 2, 2014, to let her know that he had sent out the lawsuit for service of process. (ECF No. 113 at 6). Ms. Fletcher responded that same day, stating “that she ‘did receive [the] demand package,' but had not ‘had time to complete the evaluation.'” (Id. (quoting ECF No. 113-15 at 2)). On July 15, 2014, Mr. Shakiba contacted defendant's Claim Call Center advising that he had been served with a lawsuit, and Ms. Fletcher sent the suit papers to defendant's Staff Counsel Jonathan Stebenne's office. (ECF No. 99-1 at 13). At some point, “Ms. Fletcher ‘noticed that there was an issue with who was named in the lawsuit' and ‘told [her] manager about it.'” (ECF No. 113 at 6 (quoting ECF No. 113-8 at 5)). Finally, on July 28, 2014, Mr. Rosen emailed Ms. Fletcher again, advising that he had effected service and asking whether they would be able to resolve the claim. (ECF No. 99-1 at 13).

         “On July 29, 2014, Shakiba filed his Answer to the Complaint, denying liability for the accident.” Arvon v. Shakiba, No. 2719, 2017 WL 1592555, at *2 (Md. Ct. Spec. App. May 1, 2017). “It was at this time that in-house counsel for Liberty Mutual disclosed to appellant that the actual driver was Gol and the owner was [Khodaparasti].”[4] Id. On August 4, 2014, plaintiff filed an amended complaint adding Mr. Gol and Mr. Khodaparasti as defendants. Id. Thereafter, the court granted summary judgment in Mr. Gol and Mr. Khodaparasti's favor, as they were not sued before the statute of limitations expired. Id. The court also granted summary judgment in Mr. Shakiba's favor, finding that Mr. Shakiba had no involvement in the accident. Id. The Court of Special Appeals upheld the trial court's dismissal, finding that “Shakiba's involvement in the case stems exclusively from the fact that his insurer, Liberty Mutual, mistakenly identified him as the party at fault.”[5] Id. The court further concluded that the statute of limitations period was not tolled under the doctrine of equitable tolling because the plaintiff, through Mr. Rosen, “failed to exercise the due diligence required for equitable tolling to be applied.” Id. at *3. Specifically, the court noted, there was a police report that identified Mr. Gol and Mr. Khodaparasti, but plaintiff “made no effort to review it and sue the correct parties prior to the expiration of the statute of limitations.” Id. The court also noted that plaintiff's “claims regarding misrepresentations and bad faith may be more properly aimed at Liberty Mutual in another forum.” Id. at *4. Plaintiff then filed the present lawsuit against defendant alleging both negligent and intentional misrepresentation.[6] (ECF No. 2 at 8-10). Defendant filed a third-party complaint against plaintiff's attorney, Marc Seldin Rosen, and his law firm, the Law Offices of Marc Seldin Rosen, seeking indemnification and contribution for all sums that may be adjudged against defendant, in favor of plaintiff. (ECF No. 51). Defendant's indemnification claim was dismissed by the court, however, after Mr. Rosen filed a motion to dismiss, as was defendant's claim for contribution based on plaintiff's intentional misrepresentation claim. (ECF No. 85). Defendant's claim for contribution from Mr. Rosen based on plaintiff's negligent misrepresentation claim remains. (Id.) Defendant now asks the court to grant summary judgment for defendant on both of plaintiff's counts. (ECF No. 99 at 1).


         Summary judgment is appropriate when “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). A genuine dispute remains “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is properly considered “material” only if it might affect the outcome of the case under the governing law. Id. The party moving for summary judgment has the burden of demonstrating the absence of any genuine issue of material fact. Fed.R.Civ.P. 56(a); Pulliam Inv. Co., Inc. v. Cameo Props., 810 F.2d 1282, 1286 (4th Cir. 1987). On those issues for which the nonmoving party will have the burden of proof, however, it is his or her responsibility to oppose the motion for summary judgment with affidavits or other admissible evidence specified in Federal Rule of Civil Procedure 56. Fed.R.Civ.P. 56(c); Mitchell v. Data Gen. Corp., 12 F.3d 1310, 1315-16 (4th Cir. 1993). If a party fails to make a showing sufficient to establish the existence of an essential element on which that party will bear the burden of proof at trial, summary judgment is proper. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).

         When reviewing a motion for summary judgment, the court does not evaluate whether the evidence favors the moving or nonmoving party, but considers whether a fair-minded jury could return a verdict for the nonmoving party on the evidence presented. Anderson, 477 U.S. at 252. In undertaking this inquiry, the court views all facts and makes all reasonable inferences in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). The nonmoving party, however, may not rest on its pleadings, but must show that specific, material facts exist to create a genuine, triable issue. Celotex, 477 U.S. at 324. A “scintilla” of evidence in favor of the nonmoving party, however, is insufficient to prevent an award of summary judgment. Anderson, 477 U.S. at 252. Further, “mere speculation” by the nonmoving party or the “building of one inference upon another” cannot create a genuine issue of material fact. Cox v. Cty. of Prince William, 249 F.3d 295, 299-300 (4th Cir. 2001). Summary judgment should be denied only where a court concludes that a reasonable jury could find in favor of the nonmoving party. Anderson, 477 U.S. at 252.


         In Count II of his Complaint (ECF No. 2), plaintiff alleges that defendant made “many misrepresentations of fact pertaining to the identity of its insured driver, including its settlement of the property damage claim in the name of someone other than the driver at fault, ” which plaintiff alleges were “assertions of fact that were false.” (ECF No. 2 at ¶ 27). Plaintiff further alleges that these misrepresentations were made “with the intention that [p]laintiff would rely on the same and that “[d]efendant knew that plaintiff would [and did] rely on the false assertions, statements, and actions and that the consequence of such reliance would cause damage to [p]laintiff's legal right to compensatory damages through direct action against the at fault driver for the occurrence referenced herein.” (Id. at ¶¶ 28-29). Plaintiff states that, “by justifiably relying on [d]efendant's misrepresentations, ” he was damaged significantly, as he “lost the ability to win compensation directly from the driver at fault; he was forced to undergo lengthy and protracted litigation to exhaust his civil remedies against the parties perceived to be at fault; he was denied recovery of compensatory damages, and such damages remain due and owing.” (Id. at ¶ 31).

         Similarly, in Count III of his Complaint, plaintiff alleges that defendant “asserted many false misrepresentations of fact” to plaintiff and that defendant both “knew that its misrepresentations of fact were false” and “made the false misrepresentations for the purpose of defrauding [p]laintiff.” (ECF No. 2 at ¶¶ 33-35). Plaintiff further alleges that defendant “anticipated that [p]laintiff would rely on its misunderstanding of events based on [d]efendant's many misrepresentations, ” that “[p]laintiff did, in fact, reasonably rely on the [d]efendant's misrepresentations to his substantial detriment, ” and that “[p]laintiff's reliance was justifiable.” (Id. at ¶¶ 36-37). Finally, plaintiff alleges, “[a]s a direct and proximate consequence of [d]efendant's fraud, [p]laintiff sustained significant damages for which [d]efendant is responsible.” (Id. at ¶ 38).

         To prevail on a claim of negligent misrepresentation, a plaintiff must establish, by a preponderance of the evidence, that:

(1) the defendant, owing a duty of care to the plaintiff, negligently asserts a false statement;
(2) the defendant intends that his statement will be acted upon by the plaintiff;
(3) the defendant has knowledge that the plaintiff will probably rely on the statement, which, if erroneous, will cause loss or injury;
(4) the plaintiff, justifiably, takes action in reliance on the ...

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