Thaxton v. GEICO Advantage Insurance Company

District Court, D. New Mexico·Decided February 24, 2022·No. 1:18-cv-00306·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW MEXICO __________________

MICHAEL THAXTON, on behalf of himself and all others similarly situated,

Plaintiff,

vs. No. 1:18-cv-00306-KWR-KK

GEICO ADVANTAGE INSURANCE COMPANY, GOVERNMENT EMPLOYEES INSURANCE COMPANY, GEICO GENERAL INSURANCE COMPANY, GEICO INDEMNITY COMPANY, GEICO CASUALTY COMPANY, GEICO CHOICE INSURANCE COMPANY, GEICO COUNTY MUTUAL, and GEICO SECURE INSURANCE COMPANY,

Defendants.

MEMORANDUM OPINION AND ORDER

THIS MATTER comes before the Court upon a Motion to Dismiss Pursuant to Fed. R. Civ. P. 12(b)(1) (Doc. 55) filed by Government Employees Insurance Company, Geico General Insurance Company, Geico Indemnity Company, Geico Casualty Company, Geico Choice Insurance Company, Geico County Mutual, and Geico Secure Insurance Company. Having reviewed the parties’ pleadings and the applicable law, the Court finds that Defendants’ Motion to Dismiss is well-taken and, therefore, is GRANTED. As explained below, Plaintiff lacks Article III standing as to the claims asserted against seven out of eight Defendants – i.e., all aside from GEICO Advantage Insurance Company. The claims against these defendants are dismissed without prejudice for lack of subject matter jurisdiction. BACKGROUND This is a putative class action involving underinsured motorist coverage. On August 16, 2017, Plaintiff was injured in an automobile collision with another driver. Doc. 1 at ¶¶ 11-18. The tortfeasor carried minimum limits of liability coverage, that is, $25,000 per person and $50,000 per occurrence. Plaintiff received the full extent of liability coverage carried by the tortfeasor, but that coverage was insufficient to fully compensate Plaintiff for his damages. Doc.

1 at ¶ 21. Therefore, Plaintiff alleges that the tortfeasor was an underinsured motorist at the time of the collision. Doc. 1 at ¶ 20. At the time of the collision Plaintiff was insured by one of the defendants.1 He had purchased uninsured and underinsured motorist coverage in the amount of $25,000 per person and $50,000 per occurrence. He alleges he paid a premium for that coverage. Id. at ¶¶ 19-20, 22, 30, 37, 40. Plaintiff alleges that Defendants failed to inform him that a purchase of 25/50 UIM coverage, when triggered by a crash with a tortfeasor who has 25/50 bodily injury liability limits, would result in payment of a premium for which no payment of benefits would occur. Id. at ¶¶ 29, 32-33, 38, 41-43. Plaintiff also alleges that Defendants failed to inform him that New Mexico’s

offset law drastically diminishes payment of benefits arising from a covered occurrence under his policy. Id. Finally, Defendants allegedly misrepresented to Plaintiff that he would benefit form 25/50 UIM coverage when it knew or should nave know, pursuant to New Mexico law, that coverage was meaningless. Id. at ¶¶ 26, 29, 31, 33, 38, 41-43, 62-63, 68, 79, 82. When Plaintiff requested that Defendant GEICO Advantage provide him with the UIM benefits for which he paid a premium, Defendant GEICO Advantage denied his claim. Id. at ¶¶ 34-35, 39.

1 Plaintiff generally refers to the Defendants together in his complaint. It appears that GEICO Advantage Insurance Company issued the relevant policy and denied the Plaintiff’s claim. Doc. 1 at ¶36; Doc. 1 at 25 (letter from Defendant GEICO Advantage Insurance Company denying coverage) Plaintiff subsequently filed this putative class action, asserting the following claims: Count I: Negligence; Count II: Violations of the Unfair Trade Practices Act (N.M.S.A.1978, Section 57- 12-2) (“UPA”); Count III: Violations of the Unfair Insurance Practices Act (N.M.S.A.1978, §§ 59A– 16–1 et seq.) (“UIPA”); Count IV: Breach of Contract and claim for Motorist Coverage Count V: Breach of Contract and Covenant of Good Faith and Fair Dealing; Count VI: Injunctive Relief; Count VII: Declaratory Judgment; and Count VIII: Punitive Damages.

Doc. 1. The putative class consisting of the following: All persons (and their heirs, executors, administrators, successors, and assigns) who, in the prior six years from the date of filing of this complaint, were a policyholder and/or insured, of a Motor Vehicle Policy issued by Defendants where that policy did not and does not provide underinsured coverage paid for by the policyholder, and sold and solicited by Defendants, due to the application of an offset as set forth in NMSA 66-5-301, otherwise known as the New Mexico offset law or being a "difference state".

Doc. 1 at ¶ 49. DISCUSSION Seven out of eight defendants in this case move to dismiss the claims against them, asserting that Plaintiff lacks Article III standing. They assert that Plaintiff lacks Article III standing because they did not insure Plaintiff and did not deny Plaintiff’s claim for underinsured motorist coverage. Plaintiff asserts that he has standing to assert claims against these non-insuring Defendants, because they were part of a joint venture with his insurer, Defendant GEICO Advantage. The Court concludes that Plaintiff has failed to show that the seven non-insuring Defendants were part of a joint venture with Defendant GEICO Advantage, and therefore Plaintiff has failed to establish Article III standing. Because Article III standing is a jurisdictional issue, the Court dismisses the claims against the non-insuring Defendants for lack of subject matter jurisdiction. I. Plaintiff does not have Article III standing as to the seven non-insuring Defendants. The seven non-insuring Defendants assert that Plaintiff failed to show he has standing under Article III. The Court agrees and concludes that Plaintiff failed to show (1) an injury in fact or (2) causation, and therefore failed to establish standing. Article III of the Constitution limits the jurisdiction of federal courts to cases and

controversies. U.S. Const. art. III, § 2, cl. 1; Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 471 (1982). The case or controversy limitation requires that a plaintiff have standing. Lujan v. Defenders of Wildlife, 504 U.S. 555, 559–61 (1992). A plaintiff bears the burden of establishing the elements of standing. Defenders of Wildlife, 504 U.S. at 559–61. A plaintiff has standing when (1) he has suffered an injury in fact, (2) there is a causal connection between the injury and the conduct complained of, and (3) it is likely that the injury will be redressed by a favorable judicial decision. Defenders of Wildlife, 504 U.S. at 559–61. An “injury in fact” is an invasion of a legally protected interest that is concrete,

particularized, and actual or imminent, not conjectural or hypothetical. Id. These three elements of standing are “an indispensable part of the plaintiff’s case,” and thus the plaintiff must support each element “with the manner and degree of evidence required at the successive stages of the litigation.” Id. Because injury-in-fact is a constitutional requirement, Congress “cannot erase Article III’s standing requirements by statutorily granting the right to sue to a plaintiff who would not otherwise have standing.” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547–48 (2016) (citations omitted) (“Article III standing requires a concrete injury even in the context of a statutory violation”). The non-insuring Defendants move to dismiss Plaintiff’s claims against them under Rule 12(b)(1).

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Thaxton v. GEICO Advantage Insurance Company, (D.N.M. 2022).

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