The opinion of the court was delivered by: J. Michael Seabright United States District Judge
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS COUNTS THREE AND FIVE OF THE COMPLAINT, AND GRANTING LEAVE TO AMEND
In this diversity action, Plaintiff Sharon Hamby ("Plaintiff") seeks recovery for breach of contract (Counts One and Two), violations of Washington statutory law (Counts Three and Five), common law insurance bad faith (Count Four), and repudiation (Count Six). Defendant Ohio National Life Assurance Corporation ("Defendant") has moved to dismiss Counts Three and Five, raising a conflicts-of-law issue. Defendant contends that Hawaii -- not Washington -- law should apply because, under the applicable test, Hawaii has the most significant relationship to the dispute and thus has a stronger interest in having its laws applied. See, e.g., Mikelson v. United Svcs. Auto. Ass'n, 107 Haw. 192, 198, 111 P.3d 601, 607 (2005).
Based on the following, the Motion is GRANTED. Plaintiff, however, is granted leave to amend to allege violations of Hawaii law in place of Washington law.
Defendant, an insurance company with its principal place of business in Ohio, issued two disability insurance policies to Plaintiff, one in 1991 and the other in 1994. Doc. No. 1, Pl.'s Compl. ¶¶ 3, 6, 7. Both policies were purchased and issued in the state of Washington. Id. ¶ 4. In 1998, Plaintiff made a disability benefits claim, on the basis that she had developed several permanent medical conditions. Id. ¶¶ 8, 10. Defendant accepted the claim and paid benefits to Plaintiff through February 20, 2011. Id. ¶ 9. Defendant moved to Hawaii in approximately 2007. On March 21, 2011, while Plaintiff was a Hawaii resident,*fn1 Defendant notified Plaintiff that it was denying her further benefits in a letter mailed to her Hawaii address. Id. Ex. 3.
Plaintiff filed this action on March 1, 2012. Counts Three and Five of the Complaint allege violations of Washington statutory law -- Count Three alleges a violation of Washington's Insurance Fair Conduct Act, and Count Five alleges a violation of Washington's Consumer Protection Act.
On April 10, 2012, Defendant filed its Motion to Dismiss, asserting that Counts Three and Five fail to state claims because they are based on Washington law. Because Plaintiff is a Hawaii resident (and was when Plaintiff's disability benefits were terminated), Defendant asserts that Hawaii law -- not Washington law -- should apply, and therefore Counts Three and Five fail to state claims. On May 23, 2012, Plaintiff filed her Opposition, and Defendant filed a Reply on May 29, 2012. After a status conference on June 6, 2012, the parties filed Supplemental Memoranda on June 15, 2012. A hearing was held on June 27, 2012.
Federal Rule of Civil Procedure 12(b)(6) permits a motion to dismiss a claim for "failure to state a claim upon which relief can be granted[.]"
"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)); see also Weber v. Dep't of Veterans Affairs, 521 F.3d 1061, 1065 (9th Cir. 2008). This tenet -- that the court must accept as true all of the allegations contained in the complaint -- "is inapplicable to legal conclusions." Iqbal, 556 U.S. at 678. Accordingly, "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citing Twombly, 550 U.S.at 555). Rather, "[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 ...