Insurance Law Attorneys

Fort Worth insurance law attorneys need to be aware of an opinion issued by the United States District Court in Houston.
The style of the case is, Landing Council of Co-Owners v. Federal Insurance Company.
Here is some relevant information:
Landing Counsel filed suit against Federal and the insurance agent, Higginbotham. Federal and Higginbotham had the case removed to federal court and Higginbotham sought to have the case against him dismissed because the lawsuit did not sufficiently spell out why he was being sued.
Landing Counsel argued that the case should be remanded back to the state court and tried to amend their pleadings to better spell out the reasons for suing Higginbotham.
This court denied the remand and granted the motion to dismiss as to Higginbotham.
Federal argued that the only reason Higginbotham was sued was to defeat “diversity jurisdiction” in an effort to defeat removal to federal court and pointed out, as did Higginbotham, that the pleading did not sufficiently spell out a claim against Higginbotham.
In analyzing the pleading the court noted that Landing Counsel, in it’s original pleading and later in an amended pleading, failed to plausibly state its claims against Higginbotham or failed to allege its claims with sufficient particularity for the claims requiring particularity.
First, while there is a general allegation that a valid contract for insurance exists between the Council “and Defendants,” it is clear from the factual allegations in the complaint that the policy was issued by Federal and Higginbotham merely sold the policy. Thus, there is no contract alleged between Higginbotham and the Council; the Council failed to state a claim for breach of contract against Higginbotham.
Second, the alleged wrong contained within the complaint is the denial of coverage, and there is no indication that Higginbotham, which has been identified in the complaint as the producer, had anything to do with this denial. Thus, while the Council states generally that “Defendants” breached their fiduciary duty by denying coverage, “Defendants” have been unjustly enriched, and “Defendants” had a duty to provide legal defense and insurance coverage, it appears that the Council is merely improperly lumping Higginbotham in with the insurer in its list of legal causes of action without providing any factual basis for Higginbotham’s individual responsibility.
Third, the fraud, fraud in the inducement, and negligent misrepresentation claims are not stated with enough particularity to satisfy Rule 9(b). For instance, in order to be in compliance with Rule 9(b), a plaintiff must specify the statements contended to be fraudulent. The Council states generally that “Defendant’s representative made one or more material misrepresentation(s) regarding the extent of coverage provided.” This allegation does not indicate what specific statement or statements were fraudulent. The allegation for the negligent misrepresentation claim provides slightly more information, as it indicates that “Defendant’s representative (1) made a representation to Plaintiff that it would be covered for Directors liability in acts by members and owners of the condominium property,” but the Council does not explain why this statement was a misrepresentation. The Council simply has not sufficiently alleged the who, what, when, where, and how that is required to satisfy Rule 9(b).
Fourth, the Texas Insurance Code, negligence, and breach of the duty of good faith and fair dealing claims are premised on failing to timely provide coverage mandated by the insurance policy, failing to timely settle or defend the claim, rejecting the claim, or otherwise mishandling the claim. Since Higginbotham merely sold the policy, it could not be liable for any of these alleged actions. Finally, Higginbotham could not be liable for “malice” because it is not a cause of action in Texas.
As can be seen from this case, only an experienced Insurance Law Attorney should be handling a claim against an insurance company.