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Moss v. Provident Life and Accident Insurance Co.

November 19, 2009


The opinion of the court was delivered by: Hon. Dana M. Sabraw United States District Judge


This matter comes before the Court on Defendant Provident Life and Accident Insurance Company's ("Provident") motion to dismiss Plaintiff's Third Amended Complaint ("TAC"). Defendant filed its motion on September 28, 2009, Plaintiff filed his opposition on November 6, 2009, and Defendant filed its reply on November 13, 2009. For the reasons discussed below, the Court denies Defendant's motion.


In 1982, Plaintiff contracted for two disability policies with Defendant, Policy Nos. 6-PC-495853 and 6-PC-486115. (TAC at ¶ 2.) Plaintiff also contracted for Social Insurance Substitute Benefit Riders ("Riders") on each policy. (Id. at ¶ 6.) Plaintiff paid the premiums in 1982 and 1983, and in 1984, he became disabled. (Id. at ¶ 4.) Plaintiff submitted a claim in 1984, and Defendant began paying benefits on both policies, and continues to pay benefits today. (Id. at ¶ 5.)

On September 6, 2006, Defendant realized that it had failed to pay Plaintiff any benefits under the Riders. (Id. at ¶ 10.) It notified Plaintiff of the mistake, and sent the benefits owed, but only under Policy Number 6-PC-495853. (Id.) Until this time, Plaintiff believed that he was receiving all benefits under both policies, including the Riders. (Id. at ¶ 51.)

Plaintiff thereafter contacted Defendant demanding payment of benefits under the Rider for Policy Number 6-PC-486115. (Id. at ¶ 12.) On February 8, 2008, Defendant sent Plaintiff a letter disputing the existence of this Rider, and informing Plaintiff that he had 180 days to appeal this "claim decision." (Id. at ¶ 13; TAC, Ex. 3.)

Plaintiff filed an appeal in April 2008. (TAC at ¶ 15.) In addition to the appeal, Plaintiff submitted his application for the Rider, his canceled check for the 1982 premium for the Rider, and the Rider Policy. (Id.) On September 18, 2008, Defendant sent a field representative, Richard S. Gaume, to interview Plaintiff. (Id. at ¶ 43.) Plaintiff provided Mr. Gaume with the same documents he provided previously to Defendant. (Id.) In his report of that meeting, Mr. Gaume stated: "Dr. Moss feels that he has shown us that he did take out the SIS rider coverage with policy 115, but we can not validate that because our documents are misplaced." (Id. at ¶ 44; TAC, Ex. 11.) On November 18, 2008, Defendant sent Plaintiff a letter confirming its position that Plaintiff did not purchase a Rider on Policy Number 6-PC-486115, and denying Plaintiff's appeal. (TAC at ¶ 45, Ex. 4.)

Shortly thereafter, Plaintiff filed the present case.


Defendant argues Plaintiff's claims are time-barred according to statute and contract. Plaintiff disagrees. He asserts he is entitled to the benefits of the delayed discovery doctrine. He also contends the statute of limitations on his bad faith claim and his intentional infliction of emotional distress claim did not begin to run until Defendant denied his appeal on November 18, 2008. Plaintiff also asserts Defendant is equitably estopped from relying on the contractual limitation provision.

A. Standard of Review

In two recent opinions, the Supreme Court established a more stringent standard of review for 12(b)(6) motions. See Ashcroft v. Iqbal, ___ U.S. ___, 129 S.Ct. 1937 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). To survive a motion to dismiss under this new standard, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Iqbal, 129 S.Ct. at 1949 (citing Twombly, 550 U.S. at 570). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556).

"Determining whether a complaint states a plausible claim for relief will ... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 1950 (citing Iqbal v. Hasty, 490 F.3d 143, 157-58 (2d Cir. 2007)). In Iqbal, the Court began this task "by identifying the allegations in the complaint that are not entitled to the assumption of truth." Id. at 1951. It then considered "the factual ...

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