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Liberty Mutual Fire Insurance Co. v. Bernhard MCC, LLC

United States District Court, E.D. Louisiana

February 20, 2019

LIBERTY MUTUAL FIRE INSURANCE COMPANY
v.
BERNHARD MCC, LLC, ET AL.

         SECTION "F"

          ORDER AND REASONS

          MARTIN L. C. FELDMAN UNITED STATES DISTRICT JUDGE

         Before the Court are two motions: (1) Reliance Worldwide Corporation's Rule 12(b)(6) motion to dismiss the plaintiff's petition; and (2) the plaintiff's motion for leave to amend its complaint. For the reasons that follow, the defendant's motion to dismiss the plaintiff's petition is GRANTED, but the dismissal is without prejudice; and the plaintiff's motion for leave to amend its complaint is likewise GRANTED.

         Background

         This litigation stems from a water intrusion that damaged the ACE Hotel in New Orleans.

         On August 13, 2017, several ACE Hotel rooms and their contents were allegedly damaged when a water pipe or fitting ruptured.[1] Liberty Mutual Fire Insurance Company issued a policy of property insurance in favor of the ACE Hotel at 600 Carondelet Street. The policy obliges Liberty Mutual to pay proceeds for any losses attributable to water damage. Claiming that the failure of certain pipe fittings caused the August 13 water intrusion, Liberty Mutual Fire Insurance Company sued, in state court, Reliance Worldwide Corporation (the pipe fitting manufacturer), Bernhard MCC, LLC (the pipe fitting installer and servicer), as well as Reliance Worldwide Corporation's insurer, ABC Insurance Company, Inc., and Bernhard MCC, LLC's insurer, The Travelers Indemnity Company. Liberty Mutual, which is subrogated to the rights of ACE, seeks to recover the $162, 558 in property damage it paid plus court costs and expert fees.

         Bernhard MCC, LLC answered the plaintiff's complaint and filed a crossclaim against Reliance Worldwide Corporation, alleging that RWC's plumbing fittings (called Sharkbite Push-fit Connection Systems) were unreasonably dangerous in construction or composition, unreasonably dangerous in design, unreasonably dangerous in the failure to conform to express warranties, and that RWC failed or insufficiently warned that the design would (and did) cause damage; all theories of relief arising under the Louisiana Products Liability Act.

         RWC removed the lawsuit to this Court, invoking the Court's diversity jurisdiction. RWC now moves to dismiss the plaintiff's original petition for failure to state a claim and, in response, the plaintiff now moves to amend its complaint.

         I.

         A.

         Rule 12(b)(6) allows a party to move for dismissal of a complaint for failure to state a claim upon which relief can be granted. Under Rule 8(a)(2) of the Federal Rules of Civil Procedure, a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009) (citing Fed. R. Civ. Proc. 8). "[T]he pleading standard Rule 8 announces does not require 'detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Id. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

         Thus, in considering a Rule 12(b)(6) motion, the Court "accepts 'all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff.'" See Martin K. Eby Constr. Co. v. Dall. Area Rapid Transit, 369 F.3d 464 (5th Cir. 2004) (quoting Jones v. Greninger, 188 F.3d 322, 324 (5th Cir. 1999)). But, in deciding whether dismissal is warranted, the Court will not accept conclusory allegations in the complaint as true. Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982)). Indeed, the Court must first identify allegations that are conclusory and thus not entitled to the assumption of truth. Iqbal, 556 U.S. at 678-79. A corollary: legal conclusions "must be supported by factual allegations." Id. at 678. Assuming the veracity of the well-pleaded factual allegations, the Court must then determine "whether they plausibly give rise to an entitlement to relief." Id. at 679.

         "Factual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Twombly, 550 U.S. at 555 (citations and footnote omitted). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. "Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief." Id. at 678 (internal quotations omitted) (citing Twombly, 550 U.S. at 557). "[A] plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief'" thus "requires more than labels and conclusions, and a formulaic ...


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