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El Cajon Luxury Cars, Inc., Dba Bob Baker Lexus, A California Corporation v. Tokio Marine & Nichido Fire Insurance Co.

November 8, 2011

EL CAJON LUXURY CARS, INC., DBA BOB BAKER LEXUS, A CALIFORNIA CORPORATION,
PLAINTIFF,
v.
TOKIO MARINE & NICHIDO FIRE INSURANCE CO., LTD., DEFENDANT.



The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS COMPLAINT (ECF No.7)

Presently before the Court is Defendant Tokio Marine and Nichido Fire Insurance Co., Ltd.'s ("Defendant" or "Tokio Marine") motion to dismiss complaint. (Mot. to Dismiss, ECF No. 7) Also before the Court is Plaintiff El Cajon Luxury Cars, Inc., dba Bob Baker Lexus's ("Plaintiff" or "Bob Barker Lexus") response in opposition, (Resp. in Opp'n. ECF No. 10), and Defendant's reply, (Reply in Supp., ECF No. 11).*fn1 Having considered the parties' arguments and the law, the Court GRANTS Defendant's motion to dismiss.

BACKGROUND

The present case arises out of the same unfortunate factual circumstances this Court summarized in its February 1, 2011 Order in the related case, National Union Fire Insurance Co. v. Tokio Marine & Nichido Fire Insurance Co., Ltd., 2011 U.S. Dist. LEXIS 9555 (S.D. Cal. Feb. 1, 2011):

On August 28, 2009, a Lexus vehicle loaned to Mark Saylor by Bob Baker Lexus allegedly experienced sudden unintended acceleration, causing the vehicle to crash and killing all four occupants. Six months later, the heirs of the decedents filed a wrongful death complaint against Bob Baker Lexus and several Toyota entities.

Out of this wrongful death suit, several relevant parties emerged-all of them insurance companies. [National Union] insures Bob Baker Lexus. [Tokio Marine] issued several polices to Toyota Motor North America. Hartford Casualty Insurance Company issued a policy to Bob Baker Lexus and is currently defending the company in the underlying wrongful death action.

Id. at *1--2 (citations omitted). Relevant here, the underlying action "includes allegations that Bob Barker Lexus breached its duty of care . . . regarding the maintenance, care and servicing of the vehicle." (Compl. ¶ 11, ECF No. 1)

After the underlying action was filed, Plaintiff provided notice of the action to Defendant, seeking defense and indemnification pursuant to the Tokio Marine insurance policies. (Id. ¶ 21) Although prior to the filing of the underlying action "a lawyer writing on behalf of Tokio Marine stated, 'At this point there is no suit and therefore no duty to defend . . . We believe that Hartford and Tokio Marine will have to share in the defense of Bob Baker Lexus in this matter if and when suit is filed,'" (Id. ¶ 20 (ellipsis in original)), "Tokio Marine declined coverage, including any defense obligation," (Id. ¶ 22). As a result, Plaintiff filed the instant complaint on June 7, 2011, seeking declaratory relief regarding Defendant's duty to defend, and asserting claims of breach of contract and breach of the implied covenant of good faith and fair dealing. (Compl., ECF No. 1)

On July 5, 2011, Defendant filed a motion to dismiss Plaintiff's entire complaint pursuant to Rule 12(b)(6). (Mot to Dismiss, ECF No. 7). Plaintiff filed an opposition on August 4, 2011, (Resp. in Opp'n, ECF No. 10) and Defendant replied on August 11, 2011, (Reply in Supp., ECF No. 11). The hearing set for the motion to dismiss on October 27, 2011 was thereafter vacated, and the matter was taken under submission on the papers.

LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(6) permits a party to raise by motion the defense that the complaint "fail[s] to state a claim upon which relief can be granted," generally referred to as a motion to dismiss. The Court evaluates whether a complaint states a cognizable legal theory and sufficient facts in light of Federal Rule of Civil Procedure 8(a), which requires a "short and plain statement of the claim showing that the pleader is entitled to relief." Although Rule 8 "does not require 'detailed factual allegations,' . . . it [does] demand[] more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, - US - , 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In other words, "a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] 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 (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Iqbal, 129 S. Ct. at 1949 (citing Twombly, 550 U.S. at 557).

"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Id. (quoting Twombly, 550 U.S. at 570); see also Fed. R. Civ. P. 12(b)(6). A claim is facially plausible when the facts pled "allow[] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). That is not to say that the claim must be probable, but there must be "more than a sheer possibility that a defendant has acted unlawfully." Id. Facts "'merely consistent with' a defendant's liability" fall short of a plausible entitlement to relief. Id. (quoting Twombly, 550 U.S. at 557). Further, the Court need not accept as true "legal conclusions" contained in the complaint. Id. This review requires context-specific analysis involving the Court's "judicial experience and common sense." Id. at 1950 (citation omitted). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not 'show[n]'-'that the pleader is entitled to relief.'" Id. Moreover, "for a complaint to be dismissed because the allegations give rise to an affirmative defense[,] the defense clearly must appear on the face of the pleading." McCalden v. Ca. Library Ass'n, 955 F.2d 1214, 1219 (9th Cir. 1990).

Where a motion to dismiss is granted, "leave to amend should be granted 'unless the court determines that the allegation of other facts consistent with the challenged pleading could not possibly cure the deficiency.'" DeSoto v. Yellow Freight Sys., Inc., 957 F.2d 655, 658 (9th Cir. 1992) (quoting Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1401 (9th Cir. 1986)). In other words, where leave to amend ...


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