United States District Court, M.D. Louisiana
ERIC GRAHAM ET AL.
REPUBLIC FIRE AND CASUAL INSURANCE COMPANY ET AL.
RULING AND ORDER
A. JACKSON UNITED STATES DISTRICT COURT.
the Court is the Motion for Judgment on the Pleadings (Doc.
16) by Defendant American Bankers Insurance Company of
Florida ("American Bankers"), seeking the dismissal
of all claims filed by Plaintiffs Eric Graham and Caroline
Graham ("Plaintiffs"). For the reasons explained
herein, the Motion for Judgment on the Pleadings (Doc. 16) is
DENIED IN PART and GRANTED IN PART.
reside in Baton Rouge, Louisiana. (Doc. 21 at p. 1) Their
home is characterized by a pier and beam construction with
crawl spaces underneath. (Id.) American Bankers
issued Plaintiffs a flood insurance policy on their home from
May 16, 2016 to May 17, 2017. (Doc. 1-1 at p. 4) Republic
Fire and Casualty Insurance Company ("Republic"), a
codefendant in this case, is an insurance company which
issued Plaintiffs a homeowner's insurance policy on their
home from August 2, 2016 to August 2, 2017. (Id.)
Bankers issued Plaintiffs' flood insurance policy under
the National Flood Insurance Program ("NFIP"),
which Congress created pursuant to the National Flood
Insurance Act ("NFIA") of 1968. (Doc. 16-1 at p.
2). The NFIP allows an individual to purchase a Standard
Flood Insurance Policy ("SFIP") either directly
from the Federal Emergency Management Agency
("FEMA") or from private insurance companies.
(Id. at 3). These private insurance companies are
known as "Write Your Own" ("WYO")
carriers and are authorized by federal regulation to sell
SFIPs under their own names. (Id.) The terms of an
SFIP are standardized and codified in the federal
regulations. 44 C.F.R. pt.61, app. A(1). As such, all flood
insurance policies issued by WYO companies, including
American Bankers, are identical to the terms of the SFIP.
(Doc. 16-1 at p. 3) The United States Treasury pays out all
SFIP claims as well as the costs involved in the adjustment
of such claims. (Id.)
assert that Baton Rouge suffered historic flooding and
moisture due to heavy rainfall starting on August 12, 2016.
(Doc. 1-1 at p. 5) During this flood, surface water allegedly
accumulated underneath their home. (Doc. 21 at p. 1) On or
about August 21, 2016 the original wood floods in
Plaintiffs' home allegedly began to buckle, which
resulted in warped floors rising over five inches in certain
locations. (Id.) Plaintiffs claim that on or about
September 2, 2016, they timely noticed both American Bankers
and Republic. (Doc. 1-1 at p. 5) American Bankers denied
Plaintiffs' claim for damages to the floor because its
investigation did not "identify evidence of a general
condition of flood, nor direct flood damage to their
home." (Id.) Plaintiffs appealed American
Bankers' decision to FEMA, which denied their claim on
the same basis. (Id.) In contrast, Republic denied
Plaintiffs coverage because the damaged appeared to result
from "high moisture levels from flood or surface
water" beneath the home. (Id.) Plaintiffs then
sued both American Bankers and Republic for breach of
contract and violation of Louisiana bad faith insurance
statutes. (Doc. 1-1 at p. 8)
standard for deciding a Rule 12(c) motion is the same as a
Rule 12(b)(6) motion to dismiss." Guidry v. Am. Pub.
Life Ins. Co., 512 F.3d 177, 180 (5th Cir. 2007). 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.'" In re Great
Lakes Dredge & Dock Co. LLC, 624 F.3d 201, 209 (5th Cir.
2010) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009)). "In deciding whether the complaint states a
valid claim for relief, [courts] accept all well-pleaded
facts as true and construe the complaint in the light most
favorable to the plaintiff." Id. (citing
Doe v. Myspace, Inc., 528 F.3d 413, 418 (5th Cir.
2008). Courts, however, will not accept as true
"conclusory allegations, unwarranted factual inferences,
or legal conclusions." Id. (quoting, Ferrer
v. Chevron Corp., 484 F.3d 776, 780 (5th Cir. 2007)). A
court may grant a motion for judgment on the pleadings only
if "there are no disputed issues of material fact and
only questions of law remain." Brittan Communications
Intern. Corp. v. Sw. Bell Tel. Co., 313 F.3d 899,
904 (5th Cir. 2002).
Breach of Contract Claim
Plaintiffs' Allegation Regarding the Occurrence of a
Bankers argues that Plaintiffs have not sufficiently alleged
that they experienced a flood that damaged their floors,
which precludes the SFIP from covering their loss. (Doc. 16-1
at p. 8) The Court disagrees. The SFIP defines
"flood" as the "partial or complete inundation
of two or more acres of normally dry land area or of two or
more properties from . . . unusual and rapid accumulation or
runoff of surface waters from any source." (Doc. 16-1 at
p. 6). Plaintiffs allege that East Baton Rouge Parish
experienced historic flooding from August 12 to August 14,
2016. (Doc. 1-1 at p. 5). American Bankers correctly points
out that this alone is not sufficient to allege a claim of
flooding specific to Plaintiffs' property. (Doc. 16-1 at
p. 9). However, Plaintiffs also allege that during this
event, surface water accumulated under their house and in
their yard. (Id.) Moreover, while Plaintiffs do not
specifically allege that the surface water covered two or
more properties or acres of land, the Court finds that it is
not required to do so under the federal pleading standard.
(Id.) As Plaintiffs correctly point out, the Federal
Rules of Civil Procedure utilize a "simplified notice
pleading standard" that "relies on liberal
discovery rules." Twombly, 550 at 585. "A complaint
need not set out detailed factual allegations."
Id. at 555. Thus, the Court finds Plaintiffs'
alleged facts sufficient to state a plausible claim that
flooding occurred on their property.
because American Bankers denies the occurrence of a flood, it
is a disputed material fact that cannot be resolved at this
stage in the litigation. (Doc. 10 at p. 3) The Court must
allow discovery to proceed on the extent of the accumulation