Facts Needed To Sue An Insurance Adjuster

When suing an insurance adjuster, it is necessary to articulate facts that show an adjuster did something wrong. This is illustrated in this 2018, U.S. District Court, Northern District, Dallas Division, opinion styled, Recovery Resource Counsel v. ACE American Insurance Company, et al.

Recovery Resource Counsel (RRC) alleges it suffered wind and hail damage to its insurer ACE. ACE hired Kirn to investigate the claim, who in turn hired Douglas Structure repair. Douglas Structure subsequently issued a report that RRC’s property had not sustained any damage and the claim was denied. RRC sued for breach of contract and various violations of the Texas Insurance Code.

The lawsuit was filed in State Court and ACE had the case removed to Federal Court where ACE claimed the case against Kirn was sued for the purposes of defeating diversity jurisdiction and was thus, an improper joinder.

The courts use a Rule 12(b)(6) type of analysis to determine whether or not there has been an improper joinder. To survive a Rule 12(b)(6) analysis a complaint must have contained enough facts to state a claim to relief that is plausible on its face. RRC must plead factual content that allows the court to draw reasonable inference that Kirn is liable for the misconduct alleged. RRC must provide more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level.

RRC’s petition contains only three paragraphs of factual allegations. RRC asserts it had an insurance policy, that it made a claim on the policy, and that, “upon information and belief, Kirn hired Douglas Structure” to investigate its claim “because it was known that it would issue a report on which the claim could be denied.” RRC’s only remaining assertion is that Douglas Structure did indeed issue a report, based on which ACE denied the claim. The rest of RRC’s petition merely recites the elements of each alleged cause of action, along with a conclusory assertion that Kirn is liable for each one. RRC’s threadbare recitals of the elements of its claims, supported by mere conclusory statements, do not suffice to state a claim under Rule 12(b)(6).

The Court granted Kirn’s motion to dismiss.