Summary
The Eastern District of California denied Plaintiffs’ motion to remand and granted Allstate Insurance Company of California’s motion to dismiss. The Court held that AICCA was fraudulently joined because it was not a party to the insurance policy and could not be liable for the asserted contract, bad-faith, or negligence claims on the allegations and evidence presented. AICCA was dismissed without leave to amend, and the case proceeded against Allstate Insurance Company.
Holdings
- Allstate Insurance Company of California was fraudulently joined because Plaintiffs could not establish any viable claim against it under the theories presented; its citizenship therefore did not defeat complete diversity.
- An entity that is not a party to the insurance contract cannot be liable for breach of that contract or breach of the implied covenant of good faith and fair dealing arising from the contract.
- Plaintiffs failed to establish a viable negligence claim against Allstate Insurance Company of California based on a conclusory assertion that agents or other persons working on its behalf may have negligently investigated or mishandled the claim.
- The motion to remand was denied, and Allstate Insurance Company of California was dismissed without leave to amend.
Questions Presented
- Whether Allstate Insurance Company of California was fraudulently joined so that its California citizenship could be disregarded for purposes of diversity jurisdiction.
- Whether Plaintiffs could state breach-of-contract or insurance bad-faith claims against an entity that was not a party to the insurance policy.
- Whether Plaintiffs could state a negligence claim against Allstate Insurance Company of California based on the alleged conduct of agents or others who investigated and handled the insurance claim.
- Whether Allstate Insurance Company of California should be dismissed without leave to amend.
Disposition
other
Cases Cited (21)
- Lew v. Moss, 797 F.2d 747, 749 (9th Cir. 1986)(followed)
- Resnik v. La Paz Guest Ranch, 289 F.2d 814, 819 (9th Cir. 1961)(followed)
- Strotek Corp. v. Air Transp. Ass'n of Am., 300 F.3d 1129, 1131 (9th Cir. 2002)(followed)
- Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992)(followed)
- Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996)(followed)
- Johnson v. Columbia Prop. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006)(followed)
- Weight v. Active Network, Inc., 29 F. Supp. 3d 1289, 1292 (S.D. Cal. 2014)(followed)
- Kroske v. U.S. Bank Corp., 432 F.3d 976, 980 (9th Cir. 2005)(followed)
- Singer v. State Farm Mut. Auto. Ins. Co., 116 F.3d 373, 376 (9th Cir. 1997)(followed)
- Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996)(followed)
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Court Document
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