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Team Toyota Realty, LLC v. New Hampshire Insurance Co.

United States District Court, M.D. Louisiana

May 14, 2019

TEAM TOYOTA REALTY, LLC
v.
NEW HAMPSHIRE INSURANCE COMPANY ET AL.

          RULING AND ORDER

          BRIAN A. JACKSON JUDGE

         The Administrator of the Federal Emergency Management Agency (FEMA) moves to dismiss Team Toyota Realty, LLC's claims for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1). For the reasons that follow, the Motion to Dismiss (Doc. 13) is GRANTED.

         I. BACKGROUND

         This is a dispute over payment of Team Toyotas claims under Standard Flood Insurance Policies issued by a write-your-own insurer under the National Flood Insurance Program. (Doc. 1).

         Team Toyota owns property in Baton Rouge, Louisiana that it uses for a car dealership. (Doc. 1 at ¶ 7). New Hampshire Insurance Company issued Team Toyota two Standard Flood Insurance Policies covering the property. (Id. at ¶ 8). One policy covered Team Toyota's new car building; the other covered its used car building. (Id. at ¶ 8). Both buildings suffered flood damage in August 2016. (Id. at ¶¶ 9-10).

         Pointing to the policies, Team Toyota submitted flood-loss claims to New Hampshire Insurance Company. (Id. at ¶ 11). New Hampshire Insurance Company denied $97, 038.66 of the $230, 733.75 loss Team Toyota claimed under the policy covering the used car building. (Id. at ¶ 15). Team Toyota appealed the partial denial to FEMA, and FEMA affirmed. (Id. at ¶¶ 16-17). New Hampshire Insurance Company denied $15, 718.1 of the $930, 483.49 loss Team Toyota claimed under the policy covering the new car building. (Id. at ¶ 24).

         Dissatisfied with these decisions, Team Toyota sued FEMA and New Hampshire Insurance Company for breach of contract and breach of the implied covenant of good faith and fair dealing. (Id. at ¶¶ 29-43).

         FEMA moves to dismiss Team Toyota's claims for lack of subject-matter jurisdiction. (Doc. 13). FEMA argues that it is not a proper defendant because it did not issue Team Toyota's Standard Flood Insurance Policies; New Hampshire Insurance Company, as a write-your-own insurer, did. (Doc. 13-1). FEMA also argues that it enjoys sovereign immunity as a federal agency and that the limited waiver set out in 42 U.S.C. § 4072 does not apply. (Id.).

         Team Toyota opposes. (Doc. 14). It admits that New Hampshire Insurance Company issued the policies and adjusted the claims, but it speculates that FEMA "may have played a role in the rejection of Team Toyota's claims." (Id. at p. 2). It does not argue that FEMA "disallowed" its claims under 42 U.S.C. § 4072. (Id. at pp. 1-4).

         II. LEGAL STANDARD

         This Courtis a court of limited jurisdiction. See Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Because Team Toyota invokes that jurisdiction, it bears the burden of proving it. See Glass v. Paxton, 900 F.3d 233, 238 (5th Cir. 2018). In determining its jurisdiction, the Court may consider "(1) the complaint alone, (2) the complaint supplemented by undisputed facts evidenced in the record, or (3) the complaint supplemented by undisputed facts plus the [C]ourt's resolution of disputed facts." Carroll v. Abide, 788 F.3d 502, 504 (5th Cir. 2015) (citation omitted).

         III. DISCUSSION

         A. FEMA is Not a Proper Defendant

         Congress created the National Flood Insurance Program when it enacted the National Flood Insurance Act. See 42 U.S.C. § 4001. FEMA administers the National Flood Insurance Program. See 42 U.S.C. § 4011(a). As administrator of that program, FEMA created another-the Write Your Own (WYO) program. See 42 C.F.R. §§ 62.23-62.24. The WYO program allows a private insurer, like New Hampshire Insurance Company, to issue a Standard Flood Insurance Policy in its own name. See 44 C.F.R. § 62.23. FEMA dictates the terms of such policies, 44 ...


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