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Peterson v. USAA Life Insurance Co.

United States District Court, D. Colorado

March 22, 2018

ERIN PETERSON, Plaintiff,
v.
USAA LIFE INSURANCE COMPANY, Defendant.

          ORDER DENYING DEFENDANT'S MOTION TO DISMISS

          CHRISTINE M. ARGUELLO United States District Judge

         This matter is before the Court on Defendant's Motion to Dismiss (Doc. # 21) Plaintiff's Complaint (Doc. # 12) pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons discussed herein, Defendant's Motion to Dismiss is denied.

         I. BACKGROUND

         Plaintiff, Lt. Col (ret.) Erin Peterson, is the widow of Theodore Bobkowski, who had applied for a life insurance policy from Defendant with $1, 000, 000.00 in coverage. (Doc. # 12 ¶¶ 11, 14.) The policy was issued with an effective date of September 21, 2015. (Id. at ¶ 14.) On October 22, 2016, a little over one year after obtaining the Policy, Mr. Bobkowski unexpectedly died. (Id. at ¶ 17.)

         Plaintiff, as the named beneficiary on the Policy, submitted a claim to Defendant on the insurance policy. (Doc. # 21 at 2.) Defendant subsequently denied the claim and refused to pay benefits, on grounds that Plaintiff and Mr. Bobkowski allegedly misrepresented a medical condition. (Id. at ¶ 20.) Plaintiff brought this lawsuit asserting claims against Defendant for breach of contract, bad faith breach of contract, and violation of the Colorado Consumer Protection Act (“CCPA”). (Doc. # 21 at 2.) Defendant removed the suit to Federal court. (Doc. # 1.)

         II. STANDARD OF REVIEW

         Defendant's Motion to Dismiss seeks dismissal of only the CCPA claim pursuant to Federal Rule of Civil Procedure 12(b)(6). Rule12(b)(6) provides that a defendant may move to dismiss for “failure to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). In reviewing a motion to dismiss, a court takes all well-pleaded allegations in the plaintiff's complaint as true and construe the allegations in the light most favorable to the plaintiff. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Khalik v. United Air Lines, 671 F.3d 1188, 1190 (10th Cir. 2012).

         “The court's function on a Rule 12(b)(6) motion is not to weigh potential evidence that the parties might present at trial, but to assess whether the plaintiff's complaint alone is legally sufficient to state a claim for which relief may be granted.” Miller v. Glanz, 948 F.2d 1562, 1565 (10th Cir. 1991). A claim should not be dismissed if it contains “enough facts to state a claim to relief that is plausible on its face.” Ridge at Red Hawk, L.L.C. v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007) (quoting Twombly, 550 U.S. at 570). Plausibility, in the context of a motion to dismiss, means that the plaintiff pled facts which allow “the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). If the allegations state a plausible claim for relief, such claim survives the motion to dismiss. Id.

         III. ANALYSIS

         Defendant moves to dismiss Plaintiff's CCPA claim because it does not meet two required elements for a CCPA claim: (1) that USAA Life engaged in a deceptive or unfair trade practice, and (2) that its alleged conduct significantly impacts the public. (Doc. # 21 at 1.) First, with respect to whether Defendant engaged in a deceptive or unfair trade practice, Defendant contends that Plaintiff failed to allege with particularity Defendant's unfair or deceptive trade practice as required by the CCPA and by Rule 9(b). (Id. at 6.) Second, Defendant contends that Plaintiff has not pled the necessary “significant public impact” required for a CCPA claim. (Id. at 7.)

         A. PARTICULARITY OF PLAINTIFF'S CLAIM OF DECEPTIVE OR UNFAIR TRADE PRACTICES

         1. Applicable Law

         The CCPA was “enacted to regulate commercial activities and practices, which because of their nature may prove injurious, offensive, or dangerous to the public.” Rhino Linings USA, Inc. v. Rocky Mountain Rhino Lining, Inc., 62 P.3d 142, 146 (Colo. 2003). It is “intended to deter and punish deceptive trade practices committed by business in dealing with the public.” Showpiece Homes Corp. v. Assurance Co. of America, 38 P.3d 47, 51 (Colo. 2001). The CCPA is liberally construed to serve its broad purpose and scope. Hall v. Walter, 969 P.2d 224, 230 (Colo.1998).

         A CCPA claim-like any allegation of fraud or mistake-must be pled with particularity pursuant to Federal Rule of Civil Procedure 9(b). Fed.R.Civ.P. 9(b). The purpose of the heightened pleadings under Rule 9(b) is to put Defendant on notice, so that it may prepare its case. Healthone of Denver, Inc. v. UnitedHealth Grp., Inc., 805 F.Supp. 2d. 1115, 1121 (D. Colo. 2011). To satisfy this requirement, the court requires a complaint alleging fraud to “set forth the time, place and contents of the false representation, the identity of the party making the false statements and the consequences thereof.” In re Edmonds,924 F.2d 176, 180 (10th Cir.1991). Rule 9(b) is read in conjunction with Rule 8, “which calls for pleadings to be simple, concise, and direct.” Schwartz v. Celestial ...


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