Opinion
Case No. 3:22cv23640/MCR/HTC
2023-04-11
Robert D'AGOSTINO, Plaintiff, v. SAFECO INSURANCE COMPANY OF ILLINOIS, Defendant.
Daniel Jason Finelli, Daniel Mark Soloway, Soloway Law Firm, Pensacola, FL, for Plaintiff. Matthew John Lavisky, Jamie Combee Novaes, Butler Weihmuller Katz etc. LLP, Tampa, FL, Laura Labianca Puente, Conroy Simberg, Pensacola, FL, for Defendant.
Daniel Jason Finelli, Daniel Mark Soloway, Soloway Law Firm, Pensacola, FL, for Plaintiff. Matthew John Lavisky, Jamie Combee Novaes, Butler Weihmuller Katz etc. LLP, Tampa, FL, Laura Labianca Puente, Conroy Simberg, Pensacola, FL, for Defendant. ORDER M. CASEY RODGERS, UNITED STATES DISTRICT JUDGE
Plaintiff Robert D'Agostino filed this suit against Defendant Safeco Insurance Company of Illinois ("Safeco") in state court, seeking uninsured/underinsured motorist ("UM") benefits under a Florida policy and a Georgia policy (Counts I and II, respectively) and also asserting a statutory bad faith claim based on the Florida UM policy, see Fla. Stat. § 624.155(1)(b)(1) (Count III). Safeco removed the case to this Court on diversity grounds, see 28 U.S.C. § 1441(b), 1332(a), and then promptly filed a Motion to Dismiss Count Three (the bad faith claim) for failure to state a claim and also as premature and unripe, ECF No. 7. See Fed. R. Civ. P. 12(b)(1), 12(b)(6). Plaintiff acknowledges the bad faith claim is premature but opposes dismissal, requesting abatement instead. On careful consideration, the motion to dismiss will be granted.
Under Florida law, any person may bring a civil action against an insurer if damaged by the insurer's failure to attempt to settle a claim in good faith that, under all the circumstances, should have settled. Fla. Stat. § 624.155(1)(b)(1). The bad faith action does not accrue until the underlying issues of liability and damages have been resolved. See Blanchard v. State Farm Mut. Auto. Ins. Co., 575 So. 2d 1289, 1291 (Fla. 1991). Thus, to state a bad faith claim, plaintiff must allege: "(1) a determination of liability and (2) a judgment awarding damages in excess of the policy limits." Poltar v. LM Gen. Ins. Co., 473 F. Supp. 3d 1341, 1347 (M.D. Fla. 2020). Florida courts have routinely permitted the filing of premature bad faith claims with the underlying liability claim, subject to abatement, see Fridman v. Safeco Ins. Co. of Ill., 185 So. 3d 1214, 1229-30 (Fla. 2016) (confirming that abatement is an appropriate procedural device when a premature bad faith claim is brought before damages are determined), while also noting that the decision of whether to abate or dismiss rests in the sound discretion of the trial court, see Vanguard Fire & Cas. Co. v. Golmon, 955 So. 2d 591, 595 (Fla. 1st DCA 2006) (stating that "the trial court has authority to abate the statutory claims, rather than dismiss them, if it appears to the court that abatement would be in the interest of judicial economy"). Recently, however, federal courts have observed a trend in Florida's appellate courts "to dismiss the bad faith claim without prejudice, rather than abate it." So.-Owners Ins. Co. v. Galati Yacht Sales, LLC, No. 8:21-cv-2567-VMC-MRM, 2022 WL 3684649, at *3 (M.D. Fla. Aug. 25, 2022) (stating "the weight of authority from Florida's District Courts of Appeal and Supreme Court supports dismissal") (quoting Razaqyar v. Integon Nat'l Ins. Co., No. 8:20-cv-2444-VMC-CPT, 2020 WL 6591195, at *3 (M.D. Fla. Nov. 11, 2020)); see also Torres v. Safeco Ins. Co. of Ill., No. 8:21-cv-622, 2021 WL 1909694, *1 (M.D. Fla. May 12, 2021) (noting the Florida Supreme Court allows abatement but it does not require it).
In actions predicated on diversity jurisdiction, such as this one, the Court applies the substantive law of the forum state, i.e., in this case, Florida. See Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938).
The statute also includes a requirement that the insurer must receive 60 days' written notice of the violation as a condition precedent to suit. See Fla. Stat. § 624.155(3)(a).
District courts in the Eleventh Circuit have been divided on whether a bad faith claim should be dismissed without prejudice or, instead abated pending resolution of the underlying liability and damages issues. See generally Caycho v. Am. Sec. Ins. Co., No. 8:22cv2502-KKM-AEP, 668 F.Supp.3d 1251, 1255-56 (M.D. Fla. Apr. 6, 2023) (noting the split of authority). Notably, the undersigned has previously weighed in on the side of abatement, as opposed to dismissal, on grounds of judicial economy. See Tatum v. Progressive Select Ins. Co., No. 5:18cv165/MCR/GRJ, 2018 WL 7350669, at *1 (N.D. Fla. July 23, 2018); QBE Specialty Ins. Co. v. Scrap, Inc., 3:16cv212-MCR/EMT, 2016 WL 10393762, ECF No. 19 (N.D. Fla. Aug. 31, 2016). However, the undersigned is now persuaded by the more recent district court decisions observing that when this issue arises in federal court, it presents not merely a discretionary question of procedure but instead a question of jurisdiction. See Lewis v. Allied World Specialty Ins. Co., No. 20-cv-20677, 2023 WL 2770538, at *9 (S.D. Fla. Apr. 4, 2023) (collecting cases and noting dismissal on jurisdictional grounds "appears to be the majority view in federal courts around our Circuit").
Compare, e.g., Caycho v. Am. Sec. Ins. Co., No. 8:22cv2502-KKM-AEP, 668 F.Supp.3d 1251, 1255-56 (M.D. Fla. Apr. 6, 2023) (dismissing on jurisdictional grounds), and Lewis v. Allied World Specialty Ins. Co., No. 20-CV-20677, 2023 WL 2770538, at *9 (S.D. Fla. Apr. 4, 2023) (same), with Gianassi v. State Farm Mut. Auto. Ins. Co., 60 F. Supp. 3d 1267, 1271 (M.D. Fla. 2014) (finding abatement appropriate because it "offers at least the possibility of increased judicial efficiency for those bad faith claims that do become ripe"), and Certain Interested Underwriters at Lloyd's, London v. AXA Equitable Life Ins. Co., No. 10-62061-CV, 2013 WL 3892956, at *3 (S.D. Fla. July 26, 2013) (finding abatement to be the "more efficient alternative").
As explained by the Eleventh Circuit, "[t]he general rule is that a district judge's decision neither binds another district judge nor binds him, although a judge ought to give great weight to his own prior decisions." McGinley v. Houston, 361 F.3d 1328, 1331 (11th Cir. 2004). The undersigned does not lightly change course but finds the change warranted on this issue.
Under Article III, a district court's jurisdiction is limited to cases and controversies. U.S. Const. art. III § 2, see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 559-60, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). Within this textual jurisdictional boundary lies the prudential limitation of "ripeness." Nat'l Advert. Co. v. City of Miami, 402 F.3d 1335, 1339 (11th Cir. 2005); Digital Properties, Inc. v. City of Plantation, 121 F.3d 586, 591 (11th Cir. 1997) (concluding ripeness implicates the district court's subject matter jurisdiction). The inquiry into ripeness "focuses on whether the claim presented is of sufficient concreteness to evidence a ripeness for review." Nat'l Advert. Co., 402 F.3d at 1339 (internal quotations omitted). A claim that rests on "contingent future events that may not occur as anticipated, or indeed may not occur at all," is not ripe for adjudication. Texas v. United States, 523 U.S. 296, 300, 118 S.Ct. 1257, 140 L.Ed.2d 406 (1998). Here, the issues of liability and damages, which must be resolved in Plaintiff's favor before a bad faith claim arises, might not be resolved in Plaintiff's favor, and consequently, at this time, the claim remains contingent. Therefore, "dismissal of the premature bad faith claim comports with the constitutional limitation on the Court's jurisdiction because an unripe claim does not present a 'case or controversy.' " Keating v. Underwriters at Lloyds of London Syndicate 1458, No. 5:20cv111-TKW-MJF, 2020 WL 6385322, at *2 (N.D. Fla. May 11, 2020); see also Babilla v. Allstate Ins. Co., No. 620cv1434ORL37LRH, 2020 WL 6870610, at *1 (M.D. Fla. Aug. 27, 2020) (dismissing UM bad faith claim without prejudice as "unripe"); Gilbert v. State Farm Mut. Auto. Ins. Co., 95 F. Supp. 3d 1358, 1364 (M.D. Fla. 2015) (finding "no current and definite controversy in Count III before the court because Plaintiff's bad faith claim may never accrue").
Additionally, this decision is consistent with the Federal Rules of Civil Procedure requiring a pleading to include a short and plain statement showing that the pleader "is entitled to relief," Fed. R. Civ. P. 8(a)(2), which is not possible with regard to a bad faith claim that is not yet ripe. See, e.g., Lewis, 2023 WL 2770538, at *9 ("When in doubt, we should favor the outcome that does not risk running afoul of Article III of the Constitution or the Federal Rules of Civil Procedure.") (internal marks omitted); Keating, 2020 WL 6385322, at *2 (finding "dismissal better comports with the Federal Rules of Civil Procedure"). Finally, while having previously concluded that "judicial economy favors abatement pending resolution of the liability claim," QBE Specialty Ins., 2016 WL 10393762, at *1; accord., Gianassi v. State Farm Mut. Auto. Ins. Co., 60 F. Supp. 3d 1267, 1271 (M.D. Fla. 2014) (abatement offers "at least the possibility of increased judicial efficiency for those bad faith claims that do become ripe"), the undersigned now recognizes in this context that judicial economy cannot cure a jurisdictional deficiency, see Caycho, 668 F.Supp.3d at 1256 ("Federal courts are courts of limited jurisdiction, and no amount of judicial economy can override those limits.").
Furthermore, the undersigned is no longer convinced that there is any judicial efficiency to be gained by a stay, and there is no danger of inconsistent verdicts after Fridman, which clarified that the established amount of UM damages is a binding element of a bad faith claim. 185 So. 3d at 1221-30; see also Torres, 2021 WL 1909694, at *2. Indeed, as Safeco argues, under either procedure (abatement or dismissal), when the bad faith claim becomes ripe, it effectively begins a new proceeding, requiring different evidence. Thus, discouraging the practice of filing an unripe claim in federal court in fact does more to promote judicial efficiency. See generally Keating, 2020 WL 6385322, at *3 (noting "[p]arties should not be encouraged to file claims that may never ripen," and "a compelling argument can be made that judicial economy actually favors dismissal of premature bad faith claims").
Accordingly, Defendant's Motion to Dismiss Count Three, ECF No. 7, is GRANTED. The bad faith claim, Count Three, is DISMISSED without prejudice, and Defendant has fourteen (14) days to respond to the Complaint.
DONE AND ORDERED this 11th day of April 2023.