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Silcox v. State Farm Mutual Automobile Insurance Co.

United States District Court, S.D. California

December 22, 2014

MADELINE SILCOX, as successor-in-interest to the Estate of Philip Silcox, individually and on behalf of all others similarly situated, Plaintiffs,



Presently before the Court is Defendant State Farm Mutual Automobile Insurance Company's (hereinafter referred to as "State Farm") motion to dismiss and/or strike portions of Plaintiff Madeline Silcox's ("Plaintiff") complaint. (Doc. No. 4.) For the reasons set forth below, State Farm's motion to dismiss and/or strike is GRANTED IN PART and DENIED IN PART.


On or about August 25, 2000, Philip Silcox ("Philip") purchased an insurance policy (policy number HLF271485553, and hereinafter referred to as the "Policy") from State Farm to provide long-term care insurance with Philip Silcox as the insured. (Doc. 1-1, ¶ 17.) The Policy covers expenses incurred if the insured requires "Qualified Long-Term Care" in a "Long-Term Care Facility." ( Id. ¶ 18.) "Qualified Long-Term Care" is defined in the Policy as "necessary diagnostic, preventive, therapeutic, curing, treating, mitigating, and rehabilitative services and Maintenance or Personal Services which are required by a Chronically Ill. individual, and are provided pursuant to a Plan of Care prescribed by a Licensed Health Care Practitioner." ( Id. ) The Policy defines "Long-Term Care Facility" as a facility that is "engaged primarily in providing Long-Term Care and related services to inpatients in one location and is licensed and accredited by the appropriate agency to provide such care if required by the state where it is located." (Doc. No. 1-1, ¶ 18, Doc. No. 4-3, p. 8.)

Plaintiff alleges that Philip relied upon State Farm's representations and sales presentation in deciding to purchase long-term care insurance from State Farm. (Doc. No. 1-1, ¶ 19.) Specifically, Plaintiff alleges that Philip purchased the Policy from State Farm because of State Farm's representations that the Policy was a "Qualified Long-Term Insurance Contract" as defined by the Internal Revenue Code of 1986 and other-wise complied with federal and state law. ( Id. ¶ 20.) After purchasing the Policy, Philip complied with and performed all obligations under the Policy, including the payment of all required premiums. ( Id. ¶ 21.)

On or around July 30, 2012, Philip was admitted to a licensed Residential Care Facility, ActiveCare, which is located in San Diego County. ( Id. ¶¶ 22, 23.) Plaintiff alleges that ActiveCare is a "Long-Term Care Facility" as defined by California law and provides "Qualified Long-Term Care" as defined in the Policy. ( Id. ¶¶ 24, 25.) After being admitted to ActiveCare, Philip timely requested benefits under the terms of the Policy. ( Id. ¶ 26.) In response, State Farm sent Philip a written denial of the full benefits under the Policy on September 4, 2012. ( Id. ¶ 27.) Plaintiff alleges that the denial of full policy benefits was due to State Farm's false representation that the licensure of ActiveCare fell within the Home and Community-Based Benefit under the terms of the Policy. ( Id. ) Accordingly, State Farm paid eighty percent of Philip's long-term care charges at ActiveCare. ( Id. ¶ 27.) Thereafter, State Farm continued to pay eighty percent of the monthly long-term care charges incurred by Philip leaving Plaintiff and or Philip to pay the remaining twenty percent. ( Id. ¶ 28.) The monthly charges for Philip's long-term care was $4, 800 per month, of which State Farm paid $3, 839.92, leaving an unpaid monthly amount of $960.08. ( Id. ) Philip remained at ActiveCare from July 2012 until he passed away in August 2014. ( Id. ¶ 5.) Plaintiff alleges approximately $23, 000 in policy benefits as damages. ( Id. ¶ 14.)

On August 29, 2014, Plaintiff filed a class action complaint in San Diego Superior Court alleging claims for violation of California's Unfair Competition Law (Bus. & Prof. Code § 17200, et. seq.), False Advertising Law (Bus. & Prof. Code § 17500, et. seq.), breach of contract, breach of the implied covenant of good faith and fair dealing, intentional misrepresentation, and negligent misrepresentation. ( See Doc. No. 1-1.) Plaintiff asserts the first and second causes of action for violation of the Unfair Competition Law ("UCL") and False Advertising Law ("FAL") on behalf of class plaintiffs, and the remaining causes of action individually. On October 3, 2014, [1] State Farm removed the case to federal district court under the Class Action Fairness Act. ( See Doc. No. 1.) On October 10, 2014, State Farm filed the instant motion to dismiss and/or strike portions of Plaintiff's complaint. (Doc. No. 4.) State Farm moves to dismiss the unfair competition, false advertising, and misrepresentation causes of action for failure to state a claim. State Farm also requests the Court strike or dismiss the class definitions set forth in Plaintiff's complaint and Plaintiff's request for damages in connection with the UCL and FAL claims.



A motion to dismiss pursuant to Rule 12(b)(6) tests the legal sufficiency of the claims asserted in the complaint. Fed.R.Civ.P. 12(b)(6); Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). When ruling on a motion to dismiss under Rule 12(b)(6), the court must accept all factual allegations pleaded in the complaint as true, and must construe them and draw all reasonable inferences from them in favor of the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). In doing so however, the court is not bound to accept legal conclusions as true. Ashcroft v. Iqbal, 556 U.S. 662, 664 (2009).

A complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). In the context of a Rule 12(b)(6) motion to dismiss, this means a complaint need not contain detailed factual allegations; rather, the complaint must plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 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." Iqbal, 556 U.S. at 678. "The plausibility standard is not akin to a probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. "Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief." Id. (quoting Twombly, 550 U.S. at 557) (internal citations omitted). As a result, it is not proper for a court to assume a plaintiff can prove facts not alleged in the complaint or that a defendant has violated the law in ways that have not been alleged. Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 U.S. 519, 526 (1983).

Further, complaints alleging fraud must satisfy the heightened pleading standard of Rule 9(b). Rule 9(b) requires that in all averments of fraud or mistake, the circumstances constituting that fraud or mistake should be stated with particularity. Fed.R.Civ.P. 9(b). Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally. Id. Particularity under 9(b) requires the plaintiff to plead the "who, what, when, where, and how" of the misconduct alleged. Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009.); see also Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)). Regardless of the title given to a particular claim, allegations grounded in fraud are subject to Rule 9(b)'s pleading requirements. Vess, 317 F.3d at 1103-04.


A. Request For Judicial Notice

Filed concurrently with the instant motion, State Farm filed a request for judicial notice pursuant to Federal Rule of Evidence 201. (Doc. No. 4-2.) State Farm requests the Court take judicial notice of the Policy issued to Philip along with Philip's application for insurance coverage. ( Id. at 2.) "A district court ruling on a motion to dismiss may consider a document the authenticity of which is not contested, and upon which the plaintiff's complaint necessarily relies." Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir. 1998), superseded by statute on other grounds as recognized in Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 681 (9th Cir. 2006); Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005). Further, when ruling on a Rule 12(b)(6) motion to dismiss, courts may consider material properly subject to judicial notice without converting the motion into one for summary judgment. Barron v. Reich, 13 F.3d 1370, 1377 (9th Cir. 1994).

Plaintiff's claims arise out of the contract entered into between State Farm and Plaintiff as evidenced by the Policy. To prevail, Plaintiff is required to show, at least in part, that benefits were due under the terms of the Policy and such benefits were wrongfully withheld by State Farm. Further, Plaintiff does not dispute the authenticity of the Policy or the application for insurance completed by Philip, and frequently references the Policy in both the complaint and opposition to State Farm's motion. ...

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