Bad Faith Complaint Dismissed for Conclusory Allegations; But Leave to Amend Granted

In the case of Amica Mut. Ins. Co. v. Das, No. 18-1613, 2018 WL 6435332 (E.D. Pa. Dec. 1, 2018 Jones, J.), the Eastern Federal District Court of Pennsylvania granted a carrier’s Motion to Dismiss a claim for bad faith in a case arising out of a declaratory judgment dispute over whether the injured party was a “resident relative” under an automobile insurance policy.  

The court noted that, in the context of a Motion to Dismiss a bad faith claim, the party bringing the bad faith claim must describe who, what, where, when, and how the alleged bad faith conduct occurred.  

The court reaffirmed the well-settled rule of law that carriers do not act in bad faith simply by investigating claims to protect the carrier’s interests during litigation, unless there is some evidence of dishonest purpose shown.

In this case, the pleadings were found to be conclusory and lacking in details to support the bad faith claim.  

More specifically, the court found that the bad faith claim was not supported by any fact that explained how the alleged bad faith conduct occurred.   The court stated that there were no particular facts alleged to show how the carrier lacked a reasonable basis in its interpretation, administration, or investigation of the claim for UIM benefits.  The general, conclusory allegations that the carrier “unreasonably investigated” the claim were not supported by any facts indicating how the carrier’s handling procedures were deficient.

Moreover, the claims of alleged delays failed to set forth the specific dates of any acts or omissions that could show that the delays were allegedly unreasonable. 

The court also found no specific facts were alleged to support the assertions of obstructive tactics utilized by the carrier to allegedly force an inadequate settlement.  

Despite granting the Motion to Dismiss, the court did grant leave to the insured to file an amended pleading.  

Anyone wishing to review this decision online, may click this LINK.  The companion Order can be viewed HERE.

I send thanks to Attorney Lee Applebaum of the Philadelphia law firm of Fineman, Krekstein & Harris and the writer of the excellent Pennsylvania and New Jersey Insurance Bad Faith Case Law Blog for bringing this case to my attention.