Maninder Chalal v. United Financial Casualty Company and Does 1–50

• Court: District Court, E.D. California
• Decided: September 30, 2025
• Docket: 2:25-cv-00037
• Status: Unknown

Opinion

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA 9 10 MANINDER CHALAL, individually,

11 Plaintiff, No. 2:25-cv-00037-TLN-SCR 12 v. 13 UNITED FINANCIAL CASUALTY ORDER COMPANY, and DOES 1–50, 14 Defendants. 15

16 17 This matter is before the Court on Defendant United Financial Casualty Company’s 18 (“Defendant”) Motion to Dismiss. (ECF No. 3.) Plaintiff Maninder Chalal (“Plaintiff”) filed an 19 opposition. (ECF No. 8.) Defendant filed a reply. (ECF No. 9.) For the reasons set forth below, 20 Defendant’s Motion to Dismiss is DENIED in part and GRANTED in part. 21 /// 22 /// 23 /// 24 /// 25 /// 26 /// 27 /// 28 /// 1 I. FACTUAL AND PROCEDURAL BACKGROUND 2 The instant action arises out of Defendant’s alleged lack of timeliness in tendering 3 payment under an insurance policy. (ECF No. 1-1.) On January 22, 2022,1 Plaintiff entered into 4 an insurance contract with Defendant which provided coverage for bodily injury claims. (Id. at 5 5.) On April 5, 2022, Plaintiff suffered injuries in a car accident. (Id.) On June 2, 2023, Plaintiff 6 submitted a policy limit settlement demand of $500,000 to cover expenses resulting from the 7 April 5, 2022, car accident. (Id.) Her demand included 381 pages of medical records 8 documenting her treatment since the accident until May 17, 2023, 28 pages of medical bills 9 amounting to about $170,000, and documentation outlining Plaintiff’s need for spinal surgery. 10 (Id.) 11 Plaintiff asserts she followed all material policy provisions and diligently provided all 12 requested medical documentation to Defendant. (Id.) However, “on multiple occasions,” 13 Plaintiff alleges Defendant requested irrelevant documentation, including information on past 14 medical treatments unrelated to her current claim. (Id. at 6.) Plaintiff alleges these requests were 15 “unnecessary” and contributed to significant delay in processing her claim. (Id.) Plaintiff asserts 16 there was urgency regarding her claim, which she stressed to Defendant, because she had a 17 scheduled surgery on September 6, 2023. (Id.) Finally, Plaintiff alleges Defendant made an 18 “unreasonably low initial settlement offer.” (Id. at 8.) 19 Defendant tendered the $500,000 policy limit to Plaintiff on January 3, 2024 –– seven 20 months after the initial demand was made. (Id. at 6.) Plaintiff alleges this delay in payment 21 caused her to incur “significant special damages, including but not limited to ongoing medical 22 expenses, emotional distress, and additional financial hardships.” (Id.) 23 Plaintiff filed the instant action in Sacramento Superior Court on November 19, 2024. 24 (See generally id.) Plaintiff alleges four causes of action: (1) Breach of Contract; (2) Breach of

25 1 The Court notes Plaintiff’s Complaint states that Plaintiff entered into the insurance contract on June 2, 2023. (ECF No. 1-1 at 5.) In contrast, Plaintiff’s opposition states that 26 Plaintiff entered into the insurance contract on January 22, 2022. (ECF No. 8 at 4.) As the auto 27 accident occurred in April 2022 and there appears to be no dispute as to coverage, the Court accepts the January 22, 2022 date as the date Plaintiff entered into the insurance contract. 28 1 the Implied Covenant of Good Faith and Fair Dealing (“implied covenant”); (3) Violation of the 2 California Insurance Code – Unfair Claims Practices; and (4) Negligent Infliction of Emotional 3 Distress. (Id.) Plaintiff also requests punitive damages and attorney’s fees. (Id. at 11.) On 4 January 2, 2025, Defendant removed the action to this Court (ECF No. 1) and then filed the 5 instant Motion to Dismiss on January 9, 2025 (ECF No. 3 at 1). 6 II. STANDARD OF LAW 7 A motion to dismiss for failure to state a claim upon which relief can be granted under 8 Federal Rule of Civil Procedure (“Rule”) 12(b)(6) tests the legal sufficiency of a complaint. 9 Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Rule 8(a) requires that a pleading contain a 10 “short and plain statement of the claim showing that the pleader is entitled to relief.” See 11 Ashcroft v. Iqbal, 556 U.S. 662, 677–78 (2009). Under notice pleading in federal court, the 12 complaint must “give the defendant fair notice of what the . . . claim is and the grounds upon 13 which it rests.” Bell Atlantic v. Twombly, 550 U.S. 544, 555 (2007) (internal quotations omitted). 14 “This simplified notice pleading standard relies on liberal discovery rules and summary judgment 15 motions to define disputed facts and issues and to dispose of unmeritorious claims.” Swierkiewicz 16 v. Sorema N.A., 534 U.S. 506, 512 (2002). 17 On a motion to dismiss, the factual allegations of the complaint must be accepted as true. 18 Cruz v. Beto, 405 U.S. 319, 322 (1972). A court is bound to give the plaintiff the benefit of every 19 reasonable inference drawn from the “well-pleaded” allegations of the complaint. Retail Clerks 20 Int’l Ass’n v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963). A plaintiff need not allege “‘specific 21 facts’ beyond those necessary to state his claim and the grounds showing entitlement to relief.” 22 Twombly, 550 U.S. at 570. 23 Nevertheless, a court “need not assume the truth of legal conclusions cast in the form of 24 factual allegations.” U.S. ex rel. Chunie v. Ringrose, 788 F.2d 638, 643 n.2 (9th Cir. 1986). 25 While Rule 8(a) does not require detailed factual allegations, “it demands more than an 26 unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678. A 27 pleading is insufficient if it offers mere “labels and conclusions” or “a formulaic recitation of the 28 elements of a cause of action.” Twombly, 550 U.S. at 555; see also Iqbal, 556 U.S. at 678 1 (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory 2 statements, do not suffice.”). Moreover, it is inappropriate to assume the plaintiff “can prove 3 facts that it has not alleged or that the defendants have violated the . . . laws in ways that have not 4 been alleged.” Associated Gen. Contractors of Cal., Inc. v. Cal. State Council of Carpenters, 459 5 U.S. 519, 526 (1983). 6 Ultimately, a court may not dismiss a complaint in which the plaintiff has alleged “enough 7 facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. “A claim 8 has facial plausibility when the plaintiff pleads factual content that allows the court to draw the 9 reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 10 678. While the plausibility requirement is not akin to a probability requirement, it demands more 11 than “a sheer possibility that a defendant has acted unlawfully.” Id. This plausibility inquiry is “a 12 context-specific task that requires the reviewing court to draw on its judicial experience and 13 common sense.” Id. at 679. 14 In ruling on a motion to dismiss, a court may only consider the complaint, any exhibits 15 thereto, and matters which may be judicially noticed pursuant to Federal Rule of Evidence 201. 16 See Mir v. Little Co. of Mary Hosp., 844 F.2d 646, 649 (9th Cir. 1988); Isuzu Motors Ltd. v. 17 Consumers Union of U.S., Inc., 12 F. Supp. 2d 1035, 1042 (C.D. Cal. 1998). 18 If a complaint fails to state a plausible claim, “a district court should grant leave to amend 19 even if no request to amend the pleading was made, unless it determines that the pleading could 20 not possibly be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1130 (9th 21 Cir. 2000) (en banc) (quoting Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995)). 22 III. ANALYSIS 23 A. Breach of Contract 24 Defendant argues Plaintiff cannot state a breach of contract claim because Defendant paid 25 the policy limits.2 (ECF No. 3-1 at 5.) In opposition, Plaintiff argues Defendant’s payment does 26

27 2 Defendant also argues without citation to authority that Plaintiff would have been required to incur the medical expenses for her back surgery regardless. Without more, the Court declines 28 to address this argument. 1 not negate her claim, because a delay in payment can constitute breach of contract under 2 California law. (ECF No. 8 at 6–7.) In reply, Defendant maintains its position that when an 3 insurance company pays the full policy limit, it cannot be held liable for breach of contract. (ECF 4 No. 9 at 3–4 (citing Harner v. USAA Gen. Indem. Co., 497 F. Supp. 3d 901, 909–10 (S.D. Cal. 5 2020)).) 6 Under California law, a claim for breach of contract includes four elements: that a contract 7 exists between the parties; that the plaintiff performed his contractual duties or was excused from 8 nonperformance; that the defendant breached those contractual duties; and that plaintiff's 9 damages were a result of the breach. Reichert v. Gen. Ins. Co., 68 Cal. 2d 822, 830 (1968). 10 While some courts in this circuit, such as Harner, have found there is no breach of 11 contract when an insurance company pays the full policy limit, others, including this Court, have 12 found otherwise. See e.g., Simmons v. Liberty Mut. Fire Ins. Co., No. 2:21-cv-02215-TLN-DMC, 13 2023 WL 5242671, at *8 (E.D. Cal. Aug. 15, 2023) (recognizing the split in district courts and 14 holding there was a triable issue of fact because unreasonable delay may constitute breach of 15 contract despite full payment under the policy). Here, it is unclear whether Plaintiff argues that 16 breach of the implied covenant due to unreasonable delay in tendering payment constitutes breach 17 of contract, or if the unreasonable delay itself, outside of an implied covenant claim, directly 18 constitutes breach of contract. (See ECF No. 8 at 6–8.) Regardless of which argument Plaintiff 19 relies on, the Court finds unreasonable delay in tendering payment, despite eventual payment of 20 the full policy limit, may constitute breach of contract. See Simmons, 2023 WL 5242671, at *8. 21 Accordingly, Defendant’s Motion to Dismiss Plaintiff’s Breach of Contract Claim is 22 DENIED. 23 B. Breach of the Implied Covenant of Good Faith and Fair Dealing 24 “Under California law, ‘insurance bad faith’ refers to a breach of the implied covenant of 25 good faith and fair dealing as that covenant applies to insurance policies.” Gentry v. State Farm 26 Mut. Auto. Ins. Co., 726 F. Supp. 2d 1160, 1166 (E.D. Cal. 2010). To succeed on an implied 27 covenant claim, the insured must show: (1) benefits due under the policy were withheld; and (2) 28 the reason for withholding benefits was unreasonable. Guebara v. Allstate Ins. Co., 237 F.3d 1 987, 992 (9th Cir. 2001). In the insurance context, a claim for breach of the implied covenant 2 may be brought as a tort, instead of in contract. Wilson v. 21st Century Ins. Co., 42 Cal. 4th 713, 3 720 (2007). 4 Defendant argues there cannot be a breach of the implied covenant because its 5 investigation and policy payment were not unreasonable or made in bad faith. (ECF No. 3-1 at 6 6.) Further, Defendant argues the genuine dispute doctrine precludes bad faith liability because 7 Defendant’s reasonable inquiry into the value of the claim explains the delay in payment and 8 request for further records. (Id. at 6–7.) 9 Plaintiff responds that the claim is actionable for two primary reasons. (ECF No. 8 at 8– 10 11.) First, Plaintiff argues the delay in payment was unreasonable because Defendant’s seven- 11 month investigation was too long and because Defendant requested unnecessary documentation 12 when Plaintiff had already submitted sufficient documentation. (Id. at 8.) Second, Plaintiff 13 argues the genuine dispute doctrine does not shield Defendant from liability because it does not 14 apply when the other party acts unreasonably and because there is no legitimate and reasonable 15 disagreement about coverage or the value of benefits. (Id. at 9–10.) 16 In reply, Defendant contends the delay was reasonable because its actions were to further 17 investigate the claim for which it paid the policy limits. (ECF No. 9 at 4 (citing Globe Indem. Co. 18 v. Superior Court, 6 Cal. App. 4th 725, 731 (1992)).) Further, Defendant maintains the genuine 19 dispute doctrine applies. (Id.) 20 The Court begins by addressing the parties’ unreasonableness arguments before turning to 21 the genuine dispute doctrine. 22 i. Unreasonable Delay 23 The California Supreme Court in Waller v. Truck Ins. Exch., Inc., makes clear that 24 “delayed payment based on inadequate or tardy investigations” may constitute breach of the 25 implied covenant. 11 Cal. 4th 1, 36 (1995). While there can be no unreasonable delay until the 26 insurer receives sufficient information to process a claim, see Kerrigan v. Allstate Ins. Co., 543 F. 27 Supp. 3d 843, 855 (C.D. Cal. 2021), there may be unreasonable delay when an insurer is in 28 receipt of “sufficient information to render a coverage determination.” See Lily 1993, Inc. v. 1 Spinnaker Ins. Co., No. 2:24-cv-10322-CAS(PDx), 2025 WL 417400, at *8 (C.D. Cal. Feb. 3, 2 2025). 3 Here, Defendant argues the time period it took to process the claim, including the request 4 for additional documentation was not unreasonable. (ECF No. 3-1 at 6; ECF No. 9 at 4.) 5 However, Plaintiff alleges in the Complaint that Defendant had in fact received adequate 6 documentation, did not require additional documentation to make a decision, and unreasonably 7 delayed tendering payment. (ECF No. 1-1 at 5). At this stage, the Court must accept that 8 Defendant received adequate information to process Plaintiff’s insurance claim. See Lily, 2025 9 WL 417400, at *8 (holding the plaintiffs had sufficiently pleaded unreasonable delay in their 10 claim for breach of the implied covenant because they alleged the defendant insurer had “received 11 sufficient information to render a coverage determination”). 12 Accordingly, Plaintiff has sufficiently pleaded facts to show unreasonable delay as a basis 13 for her breach of the implied covenant claim. 14 ii. Genuine Dispute Doctrine 15 Generally, an insurer who denies or delays payment of policy benefits where there is a 16 genuine dispute as to the existence or amount of coverage will not be liable for bad faith. Wilson, 17 42 Cal. 4th at 723. However, this genuine dispute rule “does not relieve an insurer from its 18 obligation to thoroughly and fairly investigate, process and evaluate the insured’s claim,” and “[a] 19 genuine dispute exists only where the insurer’s position is maintained in good faith and on 20 reasonable grounds.” Id. (emphasis in original). Specifically, the genuine dispute doctrine does 21 not shield an insurer from liability when “a jury could conclude that the insurer acted 22 unreasonably.” Id. at 724. 23 Defendant argues the genuine dispute doctrine bars Plaintiff’s claim because its conduct 24 was reasonable to request additional medical records under the circumstances. (ECF No. 3-1 at 25 7.) In opposition, Plaintiff contends again that Defendant’s actions were unreasonable, and the 26 genuine dispute doctrine only applies when there is a legitimate and reasonable disagreement 27 between the insurer and the insured. (ECF No. 8 at 9.) In reply, Defendant contends Plaintiff 28 admits in the Complaint that additional documents were provided to Defendant to allow it to 1 make an informed decision, and Defendant gave Plaintiff the benefit of the doubt when it 2 tendered the policy. (ECF No. 9 at 5.) 3 The Court finds the genuine dispute doctrine inapplicable at this time. As stated above, 4 Plaintiff has sufficiently pleaded facts to show Defendant’s conduct was unreasonable. 5 Additionally, when construing the allegations in the light most favorable to Plaintiff, it appears 6 Plaintiff alleges Defendant acted unreasonably after Plaintiff provided additional documentation 7 to Defendant. (ECF No. 1-1 at 5.) Moreover, without further explanation, it is unclear to the 8 Court how Defendant giving Plaintiff the “benefit of the doubt” demonstrates the genuine dispute 9 doctrine applies. In sum, the Court finds the genuine dispute doctrine inapplicable at this time 10 given Plaintiff’s allegations that Defendant acted unreasonably. 11 Defendant’s Motion to Dismiss Plaintiff’s implied covenant claim is DENIED.3 12 C. Violation of the California Insurance Code § 790.03 – Unfair Claims 13 Practices 14 Defendant argues this claim should be dismissed because there is no private right of action 15 under California Insurance Code § 790.03(h). (ECF No. 3-1 at 7–8 (citing Moradi-Shalal v. 16 Fireman’s Fund Ins. Cos., 46 Cal. 3d 287, 304 (1988); Rattan v. United Servs. Auto. Ass’n, 84 17 Cal. App. 4th 715, 724 (2000)).) In response, Plaintiff concedes this point. (ECF No. 8 at 11.) 18 Accordingly, Defendant’s Motion to Dismiss Plaintiff’s claim for violation of California 19 Insurance Code § 790.3 is GRANTED without leave to amend. See Moradi-Shalal, 46 Cal. 3d at 20 304 (no private right of action under § 790.03(h)). 21 D. Negligent Infliction of Emotional Distress 22 Defendant argues the Negligent Infliction of Emotional Distress (“NIED”) claim cannot 23 be brought because courts routinely disapprove of negligence claims brought by insureds against 24 insurers. (ECF No. 3-1 at 8–9.) Further, Defendant argues NIED cannot be brought as an 25 independent tort because it is only an element of damages for bad faith. (Id. at 9.) 26 3 Plaintiff does not explicitly state that her implied covenant claim is brought in tort instead 27 of in contract. But Plaintiff’s treatment of the claim aligns substantively with a tortious claim for breach of the implied covenant. Accordingly, the Court assumes that this claim was brought in 28 tort. 1 In opposition, Plaintiff argues California law does permit NIED claims by insureds against 2 insurers because of the “‘special relationship’ between an insurer and an insured that gives rise to 3 a heightened duty of good faith.” (ECF No. 8 at 11 (citing Williams v. Integon Nat’l Ins. Corp., 4 191 F. Supp. 3d 1126 (S.D. Cal. 2016)).) 5 In reply, Defendant concedes that insureds can bring NIED claims but argues Plaintiff’s 6 case does not fall into the “narrow exception” which allows plaintiffs to bring such a claim. (ECF 7 No. 9 at 6.) Defendant distinguishes Williams to show that NIED cannot be pleaded here because 8 Defendant did not accuse Plaintiff of fraud, nor did Defendant rely on a non-existing clause to 9 preclude payment of the policy limits. (Id. at 6–7.) Further, Defendant argues this cause of 10 action is a mere restatement of Plaintiff’s breach of contract and breach of the implied covenant 11 arguments. (Id. at 7.) 12 Insureds may bring a claim against their insurer for NIED under California law. See 13 Williams, 191 F. Supp. 3d at 1132–33. California courts have recognized a “special relationship” 14 between an insurer and an insured originating from the “special nature and purpose inherent in an 15 insurance contract.” Love v. Fire Ins. Exch., 221 Cal. App. 3d 1136, 1147 (1990). From this 16 special relationship, insurers have a heightened duty to act in good faith. Williams, 191 F. Supp. 17 3d at 1132–33 (citing Love, 221 Cal. App. 3d at 1147). Accordingly, where an insurer 18 mishandles a claim for policy benefits, the insurer may be liable to the insured for NIED. See 19 Williams, 191 F. Supp. 3d at 1132–33 (collecting cases). In California, NIED is a subset of 20 negligence. See Potter v. Firestone Tire & Rubber Co., 6 Cal. 4th 965, 984 (1993). To bring a 21 claim for NIED, a plaintiff must allege facts to show “(1) a legal duty to use due care; (2) a 22 breach of such duty; (3) legal cause; and (4) damages caused by the negligent breach.” Williams, 23 191 F. Supp. 3d at 1132 (citing Friedman v. Merck & Co., 107 Cal. App. 4th 454, 463 (2003)). 24 The Court finds Plaintiff has sufficiently pleaded a cause of action for NIED. First, 25 Defendant’s efforts in distinguishing Williams to show Plaintiff had not sufficiently pleaded facts 26 to allege Defendant mishandled her claim is inapposite. A Plaintiff is not required to allege facts 27 identical to Williams to bring an NIED claim but rather must simply plead allegations to support 28 the elements of the claim. 1 Second, while Plaintiff’s allegations barely surpass the required standard, Plaintiff 2 presents sufficient factual allegations to support each element of the tort. (ECF No. 1-1 at 10.) 3 Plaintiff has alleged facts to show Defendant mishandled her claim by alleging Defendant owed 4 her a duty through the implied covenant which it breached when Defendant delayed payment 5 causing emotional and financial hardship. (Id.) 6 Accordingly, Defendant’s Motion to Dismiss Plaintiff’s NIED claim is DENIED.4 7 E. Punitive Damages 8 Defendant argues punitive damages are unavailable because a breach of contract claim 9 cannot support punitive damages, and Plaintiff has not sufficiently pleaded a claim for tortious 10 breach of the implied covenant to support punitive damages. (ECF No. 3-1 at 9.) Further, 11 Defendant argues Plaintiff failed to allege Defendant acted with oppression, fraud, or malice 12 because the “allegations are nothing but bare bones allegations.” (Id. at 10.) 13 In opposition, Plaintiff argues Defendant’s conduct was sufficiently oppressive under 14 California Civil Code § 3294(a) because Defendant intentionally deprived her of “property and 15 contract rights” with “the purpose of minimizing its costs” to Plaintiff’s detriment “without regard 16 to the harm it would cause Plaintiff.” (ECF No. 8 at 12.) Plaintiff further argues Defendant’s 17 delay in tendering payment, despite its possession of all necessary documentation, created undue 18 emotional and financial hardship which constitutes “oppression” under the § 3294(a). (Id.) 19 In reply, Defendant maintains Plaintiff has not sufficiently pleaded facts to show 20 Defendant’s conduct meets the definition of oppression because Defendant never accused 21 Plaintiff of fraud, never relied on a non-existent clause to deny or delay payment, nor did 22 Defendant deny the claim. (ECF No. 9 at 7.) Further, Defendant argues it did not cause Plaintiff 23 financial hardship because Plaintiff would have been personally liable for the medical costs 24 regardless of when the payment was made. (Id. at 7–8.) 25 A request for punitive damages is available when a claim is brought for breach of a tort 26 obligation. Cal. Civ. Code § 3294(a). To recover punitive damages, the plaintiff must prove the 27 4 The Court does not consider Defendant’s duplicative claims argument because Defendant 28 does not provide caselaw by which the Court may evaluate the argument. (See ECF No. 9 at 8.) 1 defendant acted with “oppression, fraud, or malice.” Id. 2 Drawing all reasonable inferences in Plaintiff’s favor, the Court finds Plaintiff’s request 3 for punitive damages survives at this stage. First, while Defendant is correct that a breach of 4 contract claim cannot support punitive damages, the Court has determined that Plaintiff’s implied 5 covenant claim prevails, and this claim may support Plaintiff’s punitive damages request. 6 Applied Equip. Corp. v. Litton Saudi Arabia Ltd., 7 Cal. 4th 503, 516 (1994). Second, while 7 Plaintiff does not directly allege Defendant acted with oppression, fraud, or malice, the Court 8 finds the allegations allow for the inference that Defendant’s alleged delay in tendering payment 9 and the resulting emotional and financial hardship allow for the inference that Defendant acted 10 with “oppression.” See Kelley v. Corr. Corp. of Am., 750 F. Supp. 2d 1132, 1147 (E.D. Cal. 11 2010) (analyzing complaint “for any alleged facts from which fraudulent, malicious or oppressive 12 conduct could possibly be inferred”). Finally, Defendant’s argument that punitive damages are 13 not warranted because Plaintiff was personally liable for the medical costs are unpersuasive and 14 unsupported by caselaw. 15 Accordingly, Defendant’s Motion to Dismiss Plaintiff’s request for punitive damages is 16 DENIED. 17 F. Attorney’s Fees 18 Finally, Defendant argues Plaintiff cannot prove the elements to recover attorney’s fees 19 because Defendant acted reasonably and tendered payment. (ECF No. 3-1 at 11 (citing Brandt v. 20 Superior Court, 37 Cal. 3d 813, 817 (1985); Jordan v. Allstate Ins. Co., 148 Cal. App. 4th 1062, 21 1079–80 (2007)).) 22 In opposition, Plaintiff argues attorney’s fees can still be awarded, even where payment 23 was tendered, because Plaintiff had to retain counsel to ensure the payment would be made. 24 (ECF No. 8 at 12–13 (citing Brandt, 37 Cal. 3d; Cassim v. Allstate Ins. Co., 33 Cal. 4th 780 25 (2004)).) Notably, Plaintiff states that the fees she seeks “are not for proving bad faith per se, but 26 rather for the legal efforts to compel [Defendant] to honor its obligations under the policy in a 27 timely manner.” (Id. at 13.) 28 Defendant argues Plaintiff’s request must fail because Plaintiff conceded she was not 1 seeking attorney’s fees to prove bad faith and because the attorney’s fees have already been paid 2 through issuance of the policy limits. (ECF No. 9 at 8.) 3 The Court agrees with Plaintiff. In Brandt v. Superior Court, the California Supreme 4 Court held that when an insurer tortiously withholds policy benefits, the attorney’s fees 5 reasonably incurred by the insured to compel payment of those benefits are recoverable as an 6 element of damages. 37 Cal. 3d at 817. However, as the court later emphasized in Essex Ins. Co. 7 v. Five Star Dye House, Inc., such recovery is limited to fees incurred to obtain the policy benefits 8 and does not extend to fees related to other aspects of the litigation, such as punitive damages or 9 emotional distress claims. 38 Cal. 4th 1252, 1258 (2006). Further, “attorney fees expended to 10 obtain damages exceeding the policy limit or to recover other types of damages are not 11 recoverable as Brandt fees.” Id. 12 Should Plaintiff prevail in its claim that Defendant tortiously withheld payment of the 13 policy limit, Plaintiff would be entitled to recovery of her attorney’s fees incurred to compel that 14 payment. Accordingly, Defendant’s Motion to Dismiss Plaintiff’s request for attorney’s fees is 15 DENIED. 16 IV. CONCLUSION 17 For the foregoing reasons, the Court DENIES Defendant’s Motion to Dismiss (ECF 18 No. 3) on Plaintiff’s claims for breach of contract, breach of the implied covenant, NIED, 19 punitive damages and attorney’s fees. The Court GRANTS Defendant’s Motion to Dismiss on 20 Plaintiff’s claim under California Insurance Code § 790.03. 21 IT IS SO ORDERED. 22 DATE: September 29, 2025 23 24 25 26 27 28