SOUTHERN DISTRICT OF TEXAS DENIES INSURED’S MOTION TO REMAND AND DISMISSES LAWSUIT AGAINST THE ADJUSTER AND STATE FARM LLOYDS

Recently, Judge Harmon from the Southern District of Texas issued a 29 page opinion setting forth the appropriate pleading standard for the recent influx of poorly pleaded Texas hail claim cases. In Sara Dalton v. State Farm Lloyds and Stewart Brown, 4:12-cv-03004 (S.D. Tex., June 20, 2013), the Court denied an insured’s Motion to Remand and granted State Farm’s Motion to Dismiss for Failure to State a Claim. The insured sued State Farm for alleged damages caused by a January 2012 hail storm. State Farm removed the lawsuit on the basis of improper joinder of its adjuster, Stewart Brown and filed a 12(b)(6) Motion to Dismiss alleging that Plaintiff’s factual allegations against both State Farm and Stewart Brown were insufficient to satisfy the required pleadings standards.

Agreeing with State Farm, the Court noted that Plaintiff’s “bare-bones regurgitation of sections of the Texas Insurance Code have become all too common in first-party bad-faith litigation” and the insured’s petition offered no reasonable basis to predict that state law would allow recovery against the adjuster. As such, the Court noted that the allegations against the adjuster were minimal, and provided no facts and therefore failed to establish a plausible claim. More importantly, the Court affirmed its earlier decisions that concluded that when claims against an adjuster are identical to those against the insurer, the adjuster’s actions “are indistinguishable from [the insurer’s] actions’ and are insufficient to support a claim against the adjuster.” 

After dismissing the adjuster, the Court addressed State Farm’s Motion to Dismiss. The Court noted that Plaintiff’s bare-bones, conclusory, state court petition failed to meet the federal pleading standards under the Federal Rules of Civil Procedure 8 and 9(b). As such, the Court permitted the insured 20 days to cure her pleading deficiencies before the lawsuit is completely dismissed with prejudice.

[Editor’s Note: Martin, Disiere, Jefferson & Wisdom attorneys Chris Martin, Marilyn Cayce, and Raymond Kutch assisted in the preparation of State Farm’s briefing in this case. We congratulate State Farm on their successful motions.]