M-SHOT LLC, a Utah limited liability company; Moonship LLC, a Utah dba; and Devon Stanfield, an individual v. Liberty Mutual Insurance Agency, a corporation formed under the laws of Massachusetts; and Ohio Security Insurance Company, a corporation domiciled in New Hampshire

Summary

The United States District Court for the District of Utah partially granted and partially denied defendants’ motion to dismiss claims arising from an insurance dispute. The court dismissed claims by Moonship LLC and Devon Stanfield for lack of standing, dismissed all claims against Liberty Mutual Insurance Agency, and dismissed statutory unfair-claims-settlement-practices claims because the cited Utah statutes do not create a private cause of action. The dismissals were without prejudice, while the claim for breach of the implied covenant of good faith and fair dealing was allowed to proceed.

Holdings

1. Plaintiffs plausibly stated a claim for breach of the implied covenant because allegations that Defendants continued investigating the claim for an extended period, failed to resolve it promptly, and continued requesting information supported a reasonable inference of inadequate claims handling.
2. Utah Code sections 31A-26-303 and 31A-26-301 do not create private causes of action, so Plaintiffs' statutory unfair-claims-settlement causes of action had to be dismissed.
3. Moonship LLC and Devon Stanfield lacked standing to assert contractual claims under the policy because the policy identified M-Shot as the only named insured and did not identify either Moonship or Stanfield as a contracting party or intended third-party beneficiary.
4. All claims against Liberty Mutual Insurance Agency were dismissed because the policy identified Ohio Security Insurance Company as the insurer and did not plausibly allege that Liberty Mutual was a party to the insurance contract.

Questions Presented

1. Whether Plaintiffs plausibly alleged a breach of the implied covenant of good faith and fair dealing based on Defendants' allegedly delayed investigation and resolution of the insurance claim.
2. Whether Utah Code sections 31A-26-303 and 31A-26-301 create private causes of action for unfair claims settlement practices.
3. Whether Devon Stanfield and Moonship LLC had standing to assert claims under the insurance policy when the policy identified M-Shot as the named insured and did not identify them as parties or intended third-party beneficiaries.
4. Whether Liberty Mutual Insurance Agency could be liable under the policy when the policy identified Ohio Security Insurance Company as the insurer and did not show that Liberty Mutual was a contracting party.

Disposition

other