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Signal Mutual Indemnity Association, Ltd. v. Dignity Health

United States District Court, N.D. California

July 19, 2016

DIGNITY HEALTH, et al., Defendants.



         Plaintiff Signal Mutual Indemnity Association, Ltd. is a group self-insurer that secures and discharges its members’ liabilities under the Longshore and Harbor Workers’ Compensation Act (“LHWCA”). Defendants include Dignity Health St. Francis Memorial Hospital, Dr. Clement Jones, and Dr. David Cohen.

         Pending before the Court is Defendants’ motion to dismiss the complaint under Federal Rules of Civil Procedure 12(b)(1), 12(b)(6), and 12(e). Dkt. No. 13. After reviewing the materials submitted by the parties, hearing oral argument, and considering the issues raised in both, the Court GRANTS Defendants’ motion with leave to amend.

         I. BACKGROUND

         Decedent Dwayne Washington was a longshoreman employee at the Port of Oakland working for Total Terminals International, Inc. Dkt. No. 1, ¶ 9. In August 2012, decedent suffered a work-related injury while operating a sidepick. Id. at ¶ 10. Plaintiff is Total Terminal International’s insurer; pursuant to the LHWCA, [1] Plaintiff has been paying worker’s compensation benefits to decedent since his injury. Id. at ¶ 11. In May 2014, decedent had disc- replacement surgery at Defendant Dignity Health Hospital; Defendant Dr. Cohen performed the surgery and Defendants Dr. Cohen, Dr. Jones, and hospital staff performed the post-operative care. Id. at ¶¶ 12-14. On the third post-operative day, decedent died. Id. at ¶ 15. The complaint alleges that “preventable medical error” was the cause of death. Id. at ¶ 17.

         Following the injury, decedent filed a state court action against Marine Terminal Corporation (the owner of the sidepick) for its alleged negligence in causing the injury. After his death, decedent’s heirs amended the state action to include medical malpractice and wrongful death against MTC and the defendant health care providers.

         Plaintiff filed this lawsuit in federal court against Defendants on August 20, 2015. The complaint alleges that “[b]ut for the negligence and conduct of Defendants, . . . Plaintiff would not have been required to pay compensation to Decedent’s heirs, pursuant to the terms of the LHWCA.” Id. at ¶ 18. The complaint alleges two causes of action: (1) negligence, and (2) implied equitable indemnity and subrogation.


         A. Federal Rule of Civil Procedure 12(b)(1)

         To invoke a federal court’s subject-matter jurisdiction, a plaintiff needs to provide only “a short and plain statement of the grounds for the court’s jurisdiction.” Fed.R.Civ.P. 8(a)(1). “The plaintiff must allege facts, not mere legal conclusions, in compliance with the pleading standards established by” Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009). Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2014).

         Federal Rule of Civil Procedure 12(b)(1) allows a party to challenge a federal court’s jurisdiction over the subject matter of the complaint. As the party invoking the jurisdiction, the Plaintiff bears the burden of establishing that the Court has the requisite subject matter jurisdiction to grant the relief requested. See Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). A complaint will be dismissed if, looking at the complaint as a whole, it appears to lack federal jurisdiction either “facially” or “factually.” See Thornhill Publ’g Co., Inc. v. Gen. Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir. 1979).

         “In a facial attack, the challenger asserts that the allegations contained in a complaint are insufficient on their face to invoke federal jurisdiction.” Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). “By contrast, in a factual attack, the challenger disputes the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction.” Id.

         B. Federal Rule of Civil Procedure 12(b)(6)

         A defendant may move to dismiss a complaint for failing to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6). “Dismissal under Rule 12(b)(6) is appropriate only where the complaint lacks a cognizable legal theory or sufficient facts to support a cognizable legal theory.” Mendiondo v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1104 (9th Cir. 2008). To survive a Rule 12(b)(6) motion, a plaintiff must plead “enough facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. A claim is facially plausible when a 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.

         In reviewing the plausibility of a complaint, courts “accept factual allegations in the complaint as true and construe the pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Nonetheless, Courts do not “accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead Scis. Secs. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008) (internal quotation marks omitted).

         C. Federal Rule of Civil Procedure 12(e)

         Federal Rule of Civil Procedure 12(e) permits a party to “move for a more definite statement of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response.” “A Rule 12(e) motion is proper only where the complaint is so indefinite that the defendant cannot ascertain the nature of the claim being asserted and therefore cannot reasonably be expected to frame a proper response.” Gregory Vill. Partners, L.P. v. Chevron U.S.A., Inc., 805 F.Supp.2d 888, 896 (N.D. Cal. 2011) (internal quotation ...

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