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Kane v. United Services Automobile Association

United States District Court, S.D. California

September 25, 2019

RUSSELL KANE, Plaintiff,
v.
UNITED SERVICES AUTOMOBILE ASSOCIATION, and, DOES 1 TO 50, Defendant.

          ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S AMENDED MOTION FOR SUMMARY JUDGMENT [DOC. NO. 22]

          JOHN A. HOUSTON, UNITED STATES DISTRICT JUDGE

         PROCEDURAL BACKGROUND

         Plaintiff, Russell Kane, originally filed a complaint in Superior Court on November 27, 2017, asserting claims for breach of the implied covenant of good faith and fair dealing, negligent infliction of emotional distress and intentional infliction of emotional distress. Plaintiff names United Services Automobile Association (“USAA”) and Does 1 through 50 as defendants. Plaintiff alleges he was severely injured in an automobile accident on August 15, 2013 and opened an Underinsured Motorist (“UIM”) claim with Defendant, with whom he had entered into a contract for insurance, and Defendant refused to make an attempt to settle the claim, and fraudulently and maliciously withheld benefits due under the policy. Complaint ¶¶ 11, 16, 25, 48, 51, 56 (Doc. No. 1-2).

         Defendant removed the action to federal court on December 28, 2017, and later, filed a motion to dismiss the second cause of action for negligent infliction of emotional distress and third cause of action for intentional infliction of emotional distress. Finding Plaintiff sufficiently alleges severe emotional distress, the Court denied the motion as to the claim for negligent infliction of emotional distress. The Court granted the motion to dismiss the claim for intentional infliction of emotional distress after determining Plaintiff’s allegations of intentional conduct were conclusory. Plaintiff was provided an opportunity to amend the claim but did not do so. As such, the third cause of action was dismissed.

         On December 10, 2018, Defendant filed a motion for summary judgment, or in the alternative, partial summary judgment. Later, Defendant filed an amended motion for summary judgment. Plaintiff filed an opposition and Defendant filed a reply. The parties appeared before this Court for a hearing on the motion after which the Court took the matter under submission.

         FACTUAL BACKGROUND

         On August 15, 2013, Plaintiff was involved in a motor vehicle accident with another driver who was determined to be at fault for the accident. Jones Decl. ¶ 6, 7 (Doc. No. 22-4). Following his settlement with the other driver for his insurance policy limit of $30, 000, Plaintiff filed a claim for underinsured motorist bodily injury benefits pursuant to an automobile policy issued by Defendant to Plaintiff. Jones Dec. ¶ 9; Kane Decl. ¶ 6 (Doc. No. 25). Plaintiff sent demand letters dated March 25, 2015 and June 11, 2015 to Defendant seeking the policy limits.[1] Jones Decl. ¶¶ 12, 16; Kane Decl. ¶ 7 (Doc. No. 24).

         Plaintiff demanded binding arbitration and received an award of $30, 800 minus set off for disability payments on November 11, 2016, which was later reduced by the arbitrator to $25, 700.01 on December 22, 2016. Jones Decl. ¶ 18; Levy Decl. ¶ 6 (Doc. No. 22-3)[2]; Laqua Decl. ¶¶ 23, 25 Exhs. 12, 14 (Doc. No. 22-2). Defendant issued payment of $25, 700.01 to Plaintiff on January 9, 2017. Laqua Decl. ¶26, Exh. 15.

         LEGAL STANDARD

         Summary judgment is properly granted when “there is no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). Entry of summary judgment is appropriate “against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The party moving for summary judgment bears the initial burden of establishing an absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. Where the party moving for summary judgment does not bear the burden of proof at trial, as here, it may show that no genuine issue of material fact exists by demonstrating that “there is an absence of evidence to support the non-moving party’s case.” Id. at 325. The moving party is not required to produce evidence showing the absence of a genuine issue of material fact, nor is it required to offer evidence negating the non-moving party’s claim. Lujan v. National Wildlife Fed’n, 497 U.S. 871, 885 (1990); United Steelworkers v. Phelps Dodge Corp., 865 F.2d 1539, 1542 (9th Cir. 1989). “Rather, the motion may, and should, be granted so long as whatever is before the District Court demonstrates that the standard for the entry of judgment, as set forth in Rule 56(c), is satisfied.” Lujan, 497 U.S. at 885 (quoting Celotex, 477 U.S. at 323).

         Once the moving party meets the requirements of Rule 56, the burden shifts to the party resisting the motion, who “must set forth specific facts showing that there is a genuine issue for trial.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986). Without specific facts to support the conclusion, a bald assertion of the “ultimate fact” is insufficient. See Schneider v. TRW, Inc., 938 F.2d 986, 990-91 (9th Cir. 1991). A material fact is one that is relevant to an element of a claim or defense and the existence of which might affect the outcome of the suit. The materiality of a fact is thus determined by the substantive law governing the claim or defense. Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment. T.W. Electrical Service, Inc. v. Pacific Electrical Contractors Ass’n, 809 F.2d 626, 630 (9th Cir. 1987) (citing Anderson, 477 U.S. at 248).

         When making this determination, the court must view all inferences drawn from the underlying facts in the light most favorable to the nonmoving party. See Matsushita, 475 U.S. at 587. “Credibility determinations, the weighing of evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge, [when] ... ruling on a motion for summary judgment.” Anderson, 477 U.S. at 255.

         DISCUSSION

         Defendant argues Plaintiff’s causes of action for breach of the implied covenant of good faith and fair dealing, and negligent infliction of emotional distress fail as a matter of law. Defendant also argues there is no evidence to support the claim for punitive damages. Plaintiff opposes the motion.

         I. Breach of the Implied Covenant of Good Faith ...


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