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Canal Insurance Co. v. INA Trucking, LLC

United States District Court, M.D. Alabama, Southern Division

March 10, 2017

CANAL INSURANCE COMPANY, Plaintiff,
v.
INA TRUCKING, LLC, et al., Defendants.

          RECOMMENDATION OF THE MAGISTRATE JUDGE[1]

          Susan Russ Walker United States Magistrate Judge.

         Plaintiff Canal Insurance Company ("plaintiff or "Canal") commenced this lawsuit against defendants INA Trucking, LLC ("INA Trucking"); Joshua Allen Davis; and M.B.P., a minor, by and through her father, Huey Atlas Pittman. (Doc. 1). The plaintiff seeks a declaratory judgment pursuant to the Declaratory Judgment Act, 28 U.S.C. § 2201 et seq., regarding its duties under an insurance policy to provide defense or indemnity to defendants INA Trucking and Davis in a separate lawsuit that is pending in the Circuit Court of Crenshaw County, Alabama styled as M.B., a minor who sues by and through her father, Huey Alan Pittman v. INA Trucking, LLC and Joshua Allen Davis, Civil Action Number 24-CV-2015-900052.00 ("the underlying action"). In the instant case, defendant M.B.P. filed a counterclaim for declaratory judgment against the plaintiff; specifically, M.B.P. requests a declaration that plaintiff "is required to satisfy any judgment obtained by M.B.P." in the underlying action. (Doc. 13 at 8). In other words, M.B.P. brings a duty to indemnify counterclaim against Canal.

         This matter is before the court on (1) a motion to dismiss M.B.P.'s counterclaim filed by the plaintiff (Doc. 19); (2) a motion to dismiss plaintiffs complaint and M.B.P. 's counterclaim or, in the alternative, to stay these proceedings filed by M.B.P. (Doc. 33 at 2); (3) a motion to dismiss filed by defendant Davis (Doc. 28); and (4) a motion to stay as to plaintiffs duty to indemnify claim filed by Canal (Doc. 40).[2] M.B.P. 's motion to dismiss is analyzed under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). The remaining motions to dismiss are brought pursuant to Federal Rule of Civil Procedure 12(b)(6). By order entered on April 19, 2016, U.S. District Judge Myron H. Thompson referred this case to the undersigned for action or recommendation on all pretrial matters. (Doc. 32). See 28 U.S.C. § 636(b); Fed.R.Civ.P. 72(b). For the reasons discussed below, the undersigned Magistrate Judge recommends that plaintiffs motion to dismiss is due to be granted, plaintiffs motion to stay its duty to indemnify claim is due to be denied as moot, M.B.P. 's motions are due to be denied except that the motion to dismiss is due to be granted as to plaintiffs duty to indemnify claim, and defendant Davis' motion to dismiss is due to be denied.

         STANDARDS OF REVIEW

         I. Federal Rule of Civil Procedure 12(b)(6)

         A Rule 12(b)(6) motion to dismiss tests the sufficiency of the Complaint against the legal standard set forth in Rule 8: "a short and plain statement of the claim showing that the pleader is entitled to relief" Fed.R.Civ.P. 8(a)(2).

         In evaluating a motion to dismiss pursuant to Rule 12(b)(6), the court must take "the factual allegations in the complaint as true and construe them in the light most favorable to the plaintiff." Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). However, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions." Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). "[A] plaintiffs obligation to provide the 'grounds' of his ' entitle[ment] to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." BellAtl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).

         "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). "Determining whether a complaint states a plausible claim for relief [is] ... a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 663 (alteration in original) (citation omitted). "[F]acial plausibility" exists "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 556). The standard also "calls for enough facts to raise a reasonable expectation that discovery will reveal evidence" of the claim. Twombly, 550 U.S. at 556. While the complaint need not set out "detailed factual allegations, " it must provide sufficient factual amplification "to raise a right to relief above the speculative level." Id. at 555.

         "So, when the allegations in a complaint, however true, could not raise a claim of entitlement to relief, 'this basic deficiency should ... be exposed at the point of minimum expenditure of time and money by the parties and the court.'" Twombly, 550 U.S. 558 (quoting 5 Wight & Miller § 1216, at 233-34 (quoting, in turn, Daves v. Hawaiian Dredging Co., 114 F.Supp. 643, 645 (D. Haw. 1953)). "[O]nly a complaint that states a plausible claim for relief survives a motion to dismiss." Iqbal, 556 U.S. at 679 (citing Twombly, 550 U.S. at 556).

In keeping with these principles a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth. While legal conclusions can provide the framework of a complaint, they must be supported by factual allegations. When there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.

Iqbal, 556 U.S. at 679.

         II. Federal Rule of Civil Procedure 12(b)(1)

         The Rule 12(b)(1) standard of review was summarized in Greenwell v. University of Alabama Bd. of Trustees, 2012 WL 3637768 (N.D. Ala. Aug. 22, 2012). The court explained:

Challenges to subject-matter jurisdiction under Rule 12(b)(1) of the Federal Rules of Civil Procedure can exist in two substantially different forms: facial attacks and factual attacks. Sinaltrainal v. Coca-Cola Co., 578 F.3d 1252, 1260 (11th Cir. 2009). When presented with a facial attack on the complaint, the court determines whether the complaint has sufficiently alleged subject-matter jurisdiction. Sinaltrainal, 578 F.3d at 1260. The court proceeds as if it were evaluating a Rule 12(b)(6) motion; that is, it views the complaint in the light most favorable to the plaintiff and accepts all well-pled facts alleged in the complaint as true. Id.
On the other hand, factual attacks question "the existence of subject matter jurisdiction in fact, irrespective of the pleadings, and matters outside the pleadings, such as testimony and affidavits, are considered." Id. (citing Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th Cir. 1990)). When a court is confronted with a factual attack, the standard of review diverges considerably:
[T]he trial court may proceed as it never could under 12(b)(6) or Fed.R.Civ.P. 56. Because at issue in a factual 12(b)(1) motion is the trial court's jurisdiction-its very power to hear the case-there is substantial authority that the trial court is free to weigh the evidence and satisfy itself as to the existence of its power to hear the case. In short, no presumptive truthfulness attaches to plaintiffs allegations, and the existence of disputed material facts will not preclude the trial court from evaluating for itself the merits of jurisdictional claims.
Lawrence, 919 F.2d at 1529 (citing Williamson v. Tucker, 645 F.2d 404, 412 (5th Cir.), cert, denied, 454 U.S. 897 (1981)). When a district court has pending before it both a 12(b)(1) motion and a 12(b)(6) motion, the generally preferable approach, if the 12(b)(1) motion essentially challenges the existence of a federal cause of action, is for the court to find jurisdiction and then decide the 12(b)(6) motion. Jones v. State of Ga., 725 F.2d 622, 623 (11th Cir. 1984).

Greenwell at *5 (alterations in original); see also McCoy v. Mallinckrodt Pharm., Inc., 2016 WL 1544732, at *2 (M.D. Ala. Mar. 23, 2016), report and recommendation adopted, 2016 WL 1465967 (M.D. Ala. Apr. 14, 2016) (quoting Greenwell standard of review).

         The challenge before the court is a facial challenge - i.e., M.B.P. challenges the ripeness of plaintiff s duty to indemnify claim based on the allegations of the complaint. (Doc. 1 at 3 (plaintiff asserts that the underlying action is ongoing and that the matter of indemnity is unsettled)).[3]

         BACKGROUND AND PROCEDURAL HISTORY

         Mr. Pittman, acting on behalf of M.B.P., commenced the underlying action against INA Trucking and Mr. Davis on September 8, 2015. (Doc. 1 at 3; Doc. 1-1). In that action, Pittman alleges, inter alia, that, "[o]n or about July 12, 2015, " his daughter, M.B.P., "was a front seat passenger of a tractor trailer truck operated by ... Joshua Allen Davis" and owned by INA Trucking. (Doc. 1-1 at 3). Pittman asserts that Davis, while acting as an agent or employee of INA Trucking, "caused the vehicle he was operating to leave the roadway and strike a culvert." (Id.). After the collision, Davis allegedly "left the scene." (Id.). Pittman avers that M.B.P. "sustained a skull fracture and various other injuries ...


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