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Calloway v. MetLife Securities, Inc.

United States District Court, N.D. Alabama, Eastern Division

October 10, 2018




         Plaintiffs allege Defendant MetLife Securities, Inc. (“MSI”) is responsible for a fraud perpetrated by its agent Bryan Anderson. The action is before the court on Defendant's motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). (Doc. 30). The court concludes that Defendant's motion is due to be granted.


         This action arises from Plaintiffs' sixteen-year-old interactions with Anderson, a former employee of Defendant. In early 2002, after her husband's death, Plaintiffs' mother, Fran Waldrup, was contacted by Bryan Anderson who informed Fran that her husband's life insurance policy required the equal division of the proceeds between Fran and Plaintiffs. (Doc. 29 (“Compl.”) at 5). Anderson told her that Plaintiffs' father “had likely made a mistake and that the funds were likely supposed to have been left to her alone.” (Id.) Faced with the possibility of a jarring change in lifestyle, Fran called Plaintiffs to relay to them what she had been told by Anderson. (Id. at 5-6). Shortly thereafter, in about March 2002, Plaintiffs met with Anderson and Fran to discuss the situation. (Id. at 6). Anderson repeated his belief that Plaintiffs' father had meant to leave the insurance proceeds to Fran alone and that he “had simply made a mistake filling out the beneficiary form.” (Id.) He went further, suggesting that the tax rate would be higher if Plaintiffs kept their portion of the proceeds. (Id.) He proposed that Plaintiffs give their portions of the policy to Fran so that the tax rate would be less and she could place the money in her MSI account which would allow Anderson to manage the money. (Id.) Plaintiffs agreed to Anderson's plan. (Id.)

         A short time later, on April 18, 2002, the funds from the life insurance policy were deposited in Plaintiffs' accounts. (Id.) On May 8, 2002, Plaintiffs and Fran met with Anderson to make the transfers of funds from Plaintiffs' accounts to Fran. (Id. at 6-7). They did so by writing personal checks for the portion they had received from the policy. Anderson told Plaintiffs to write “Gift” on the memorandum line of each check. (Id. at 7). A total of $186, 246.00 was transferred to Fran's accounts. (Id.) During the meeting, Plaintiff Tanisha Waldrup Pike suggested to her mother that the money could be used to pay off the mortgage on Fran's home. Anderson discouraged that, saying that “paying off the house sooner would not truly help Fran as much as being able to access the money and having it grow by investing it.” (Id.)

         Plaintiffs met with Anderson and Fran again in about February or March 2004. (Id. at 7). Before the meeting, Fran told Plaintiffs that Anderson had put her money in a “fool proof” real estate investment and that she was guaranteed a 100% return on the investment. (Id.) According to Anderson, the investment was “hush-hush” and was made available on an exclusive basis. (Id.)

         Anderson proceeded to use the money as part of a massive Ponzi scheme for which he was arrested, charged, and convicted in 2015. (Id. at 8). Fran lost all of the money by 2010.[1] (Id. at 9).

         In 2016, fourteen years after the first meeting with Anderson, Plaintiff Calloway read an article online about the Ponzi scheme and realized that Fran had been swindled. (Id. at 8). Further, she believed that Plaintiffs had been duped by Anderson into giving away the proceeds of their father's life insurance policy. (Id.) In response to this belief, Plaintiffs filed this action against MSI as Anderson's former employer. (Doc. 1). Plaintiffs filed an amended complaint on August 7, 2018. (Doc. 29). On August 21, 2018, Defendant moved to dismiss the amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. 30).


         To survive a motion to dismiss, a pleading must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2) & 12(b)(6). “[T]he pleading standard described by Rule 8 does not required detailed factual allegations, but it demands more than an unadorned, the defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662 (2009). It is insufficient to simply recite the elements of a cause of action or make conclusory allegations. See Id. Mere naked assertions devoid of factual support do not satisfy the requirements of Rule 8. See id.

         To avoid dismissal, “a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Id. A complaint meets this standard “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. Thus, the complaint must establish more than the mere possibility that a defendant has acted unlawfully. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In the end, this inquiry is a “context specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id.


         Plaintiffs' complaint contains multiple counts. Plaintiffs have alleged the following claims: (1) failure to supervise and investigate, (2) breach of fiduciary duty, (3) breach of contract, (4) “common law claims” of intentional and negligent misrepresentation, unjust enrichment and breach of the duty of good faith and fair dealing, and (5) fraud. (Doc 29. at 9-17). Defendant contends that various grounds exist for dismissing each claim. Some contentions apply to every claim and others apply to only certain claims. They will be addressed below.

         A. ...

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