Pleading Bad Faith

Bad Faith insurance claims require specific pleading in Federal Court.  This is illustrated in the Northern District of Texas, Fort Worth Division, opinion styled, Charlotte R. Carroll v. State Farm Mutual Automobile Insurance Company.

Carroll alleges:

The plaintiff filed a claim with the defendant under her insurance policy after a severe blow out on the expressway.  After several weeks of getting the run  around, the defendant deceived the plaintiff into believing a check they mailed to her in the amount of $3496.94 would completely pay for all covered repairs to the plaintiffs vehicle.  Which was more than far from the truth.

After being confronted by their deceit, the defendant took full responsibility for their actions, but then later refused to pay for the necessary covered repairs to the plaintiffs vehicle.

As a result of the defendants refusal to pay for the covered repairs, she had no other option but to turn her vehicle over to her finance company, resulting in a repossession on her credit, and a bill for the balance remaining after her vehicle was publicly auctioned.

Plaintiff seeks to recover $128,076.00 “including damages, penalties, costs, expenses, etc.”

State Farm alleges Carroll has not pleaded any facts upon which a plausible claim to relief can be granted.

Rule 8(a)(2) of the Federal Rules of Civil Procedure provides, in a general way, the applicable standard of pleading.  It requires that a complaint contain “a short and plain statement of the claim claim showing that the pleader is entitled to relief” in order to give the defendant fair notice of what the claim is and the grounds upon which it rests.  Although a complaint need not contain detailed factual allegations, the “showing” contemplated by Rule 8 requires the plaintiff to do more than simply allege legal conclusions or recite the elements of a cause of action.

To allege a plausible right to relief, the facts pleaded must suggest liability; allegations that are merely consistent with unlawful conduct are insufficient.  In other words, where the facts pleaded do no more than permit the court to infer the possibility of misconduct, the complaint has not shown that the pleader is entitled to relief.

As the Fifth Circuit has explained: “Where the complaint is devoid of facts that would put the defendant on notice as to what conduct supports the claims, the complaint fails to satisfy the requirement of notice pleading.”

This opinion then pointed out how Carrol had not satisfied any of the “bad faith” pleading requirements.

This Court dismissed all the “bad faith” allegations but left standing contract allegations.  Then the Court ordered Carroll to explain, in detail, how the alleged damages of $128,076.00 were being calculated.