Johnson v. Geico Casualty Co.

269 F.R.D. 406, 2010 U.S. Dist. LEXIS 68801, 2010 WL 2720790
CourtDistrict Court, D. Delaware
DecidedJuly 9, 2010
DocketC.A. No. 06-408-JJF
StatusPublished
Cited by5 cases

This text of 269 F.R.D. 406 (Johnson v. Geico Casualty Co.) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Johnson v. Geico Casualty Co., 269 F.R.D. 406, 2010 U.S. Dist. LEXIS 68801, 2010 WL 2720790 (D. Del. 2010).

Opinion

MEMORANDUM OPINION

FARNAN, District Judge.

Presently before the Court are several motions pertaining to discovery disputes: (1) Motion For Order To Show Cause And Sanctions Against Berkshire Hathaway, Inc. (D.I. 193) filed by Plaintiffs Sharon Anderson and Kerry Johnson; (2) Motion For Protective Order (D.I. 256) filed by Defendants GEICO Indemnity Company and Government Employees Insurance Company; and (3) Motion To Compel Defendants’ Production Of Documents (D.I. 286) filed by Plaintiffs Sharon Anderson and Kerry Johnson. Also before the Court is a Rule 12(b)(1) Motion To Dismiss For Lack Of Standing and Rule 12(b)(6) Motion To Dismiss For Failure To State A Claim (D.I. 318) filed by Defendant GEICO Corporation, and a Motion To Stay Order Pending Appeal (D.I. 331) filed by Defendants Government Employees Insurance Company, GEICO Indemnity Company, and GEICO Corporation.

I. Background

Plaintiffs Kerry Johnson and Sharon Anderson (collectively, “Plaintiffs”) initially filed this class action suit on behalf of themselves and all others similarly situated in the Superior Court for the State of Delaware in and for New Castle County; it was subsequently removed to this Court on June 27, 2006. (D.I. 1.) The factual background relevant to this action has been fully set forth in the Court’s previous Memorandum Opinions. Plowever, a few salient procedural items bear repeating here.

[408]*408In a Memorandum Opinion and Order issued on December 11, 2009 (D.I. 314, 315), the Court granted Plaintiffs’ Motion For Leave To Amend First Amended Complaint. The Second Amended Class Action Complaint (D.I. 316) added GEICO Corporation as an additional defendant, added a Count VII for tortuous interference with contractual relations, and added a claim for injunctive relief. The Second Amended Class Action Complaint also amended the proposed class definitions, and supplemented the causes of action with additional facts. Also in its December 11, 2009 Memorandum Opinion and Order, the Court granted Defendants’ Rule 12(b)(1) Motion To Dismiss For Lack Of Standing, dismissing GEICO Casualty Company (“GEICO Casualty”) and GEICO General Insurance Company (“GEICO General”) as defendants. Accordingly, the following claims remain against Defendants GEICO Indemnity Company (“GEICO Indemnity”), Government Employees Insurance Company, and GEICO Corporation (collectively, “Defendants”): Count I, declaratory judgment that Defendants violated 21 Del. C. § 2118 and breached their automobile contracts with Plaintiffs; Count II, breach of contract; Count III, bad faith breach of contract; Count IV, breach of the duty of fair dealing; Count V, common law fraud; Count VI, consumer fraud in violation of 6 Del. C. § 2513; and Count VII, tortuous interference with contractual relations.

On December 30, 2009, the Court granted in part and denied in part the parties’ motions regarding class certification. (D.I. 321.) Specifically, the Court certified the Passive Modality Class, with Ms. Anderson as class representative, to pursue a class action suit against Defendants as to Counts III, IV, and VI. (Id.) The Court certified the Geographic Reduction Class, with Ms. Anderson as class representative, to pursue a class action suit against Defendants as to Counts III, IV, and VI. (Id.)

II. Defendants’ Rule 12(b)(1) Motion To Dismiss For Lack Of Standing and Rule 12(b)(6) Motion To Dismiss For Failure To State A Claim (D.I. 318)

A. Parties’ Contentions

By their Motion To Dismiss, Defendants first claim that Plaintiffs lack standing against GEICO Corporation, and therefore, that GEICO Corporation should be dismissed as a defendant to this action. (D.I. 319.) Defendants note that while the Second Amended Class Action Complaint (D.I. 316) alleges that Ms. Anderson was a named insured of Government Employees Insurance Company, and that Mr. Johnson was a named insured of GEICO Indemnity Company, it only alleges that GEICO Corporation “is a holding company whose affiliates are personal lines property and casualty insurers.” (Id. at 2.) Defendants contend that, as a holding company, GEICO Corporation does not issue insurance policies or engage in handling PIP claims in Delaware, and further, that there is no allegation that either Plaintiff is in contractual privity with GEICO Corporation. (Id. at 3—4.) As a result, Defendants contend that Plaintiffs’ alleged injuries are not traceable to GEICO Corporation, and that GEICO Corporation should be dismissed for the same reasons former Defendants GEICO Casualty and GEICO General were dismissed.1 (Id.) Alternatively, Defendants contend that the Second Amended Complaint does not state a plausible claim for relief against GEICO Corporation, and does not make any allegation connecting GEICO Corporation to Plaintiffs’ injuries. (Id. at 6-7.)

Plaintiffs contend that the Second Amended Complaint states a claim against GEICO [409]*409Corporation upon which relief can be granted, and that the allegations in the Second Amended Complaint and evidence in record demonstrates that Plaintiffs have standing against GEICO Corporation. (D.I. 327, at 7.) Plaintiffs contend that the record shows that GEICO Corporation “actively participates in, if not controls, the management and strategies implemented by [GEICO Indemnity and Government Employees Insurance Company].” (Id. at 5.) Plaintiffs contend that GEI-CO Corporation is integrally linked to GEI-CO Indemnity and Government Employees Insurance Company in that GEICO Corporation regularly receives management reports documenting, inter alia, claims handling systems and cost-containment efforts. (Id.) Specifically, Plaintiffs point to representations about GEICO Corporation made by Berkshire Hathaway, Inc. (“Berkshire”), Defendants’ parent company, to the Securities and Exchange Commission, and financial statements that demonstrate that GEICO Corporation provides “advisory services” to GEICO Indemnity and Government Employees Insurance Company. (Id. at 7.) Further, Plaintiffs contend that standing is not lacking merely because Plaintiffs are not in contractual privity with GEICO Corporation because not all claims are premised on contractual privity. (Id.)

B. Legal Standard

1. Rule 12(b)(1)

Pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure, the Court may dismiss a complaint for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). Motions brought under Rule 12(b)(1) may present either a facial challenge or a factual challenge to the Court’s subject matter jurisdiction. Gould Elecs. Inc. v. U.S., 220 F.3d 169, 176 (3d Cir.2000) (citing Mortensen v. First Fed. Sav. and Loan Ass’n, 549 F.2d 884, 891 (3d Cir.1977)). If the motion presents a factual attack, the Court may consider evidence outside the pleadings, id., including affidavits, depositions, and testimony, to resolve factual issues bearing on jurisdiction. Gotha v. U.S., 115 F.3d 176, 179 (3d Cir. 1997).

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269 F.R.D. 406, 2010 U.S. Dist. LEXIS 68801, 2010 WL 2720790, Counsel Stack Legal Research, https://law.counselstack.com/opinion/johnson-v-geico-casualty-co-ded-2010.