United States District Court, D. Hawaii, Seattle
JULIA WIECK, on behalf of herself and all others similarly situated, Plaintiff,
CIT BANK, N.A.; FINANCIAL FREEDOM; SEATTLE SPECIALTY INSURANCE SERVICES, INC.; CERTAIN UNDERWRITERS OF LLOYD'S, LONDON; and GREAT LAKES REINSURANCE UK, PLC, Defendants.
ORDER GRANTING IN PART AND DENYING IN PART MOTIONS TO
DISMISS PLAINTIFF'S SECOND AMENDED COMPLAINT, ECF NOS.
123, 124 & 125
Michael Seabright Chief United States District Judge.
March 30, 2018, this court issued a comprehensive decision
(“the March 30th Order”) that granted in part and
denied in part several motions to dismiss the First Amended
Complaint (“FAC”) in this putative class action,
which arises out of lender-placed (or
“forced-placed”) hurricane insurance on reverse
mortgages. See ECF No. 96; Wieck v. CIT Grp.,
Inc., 308 F.Supp.3d 1093 (D.
2018). The March 30th Order determined that some of Plaintiff
Julia Wieck's (“Plaintiff” or
“Wieck”) claims - certain non-preempted breach of
contract, and unfair or deceptive trade practices allegations
- survived the motions to dismiss, but the Order dismissed
other claims. The court granted Plaintiff leave to file a
Second Amended Complaint (“SAC”) solely to
attempt to rectify pleading deficiencies with the claims that
were dismissed without prejudice as explained in the March
30th Order. Accordingly, Plaintiff filed a SAC on May 11,
2018, ECF No. 104, and Defendants now move to dismiss the
repleaded claims. ECF Nos. 123, 124 & 125. Based on the
following, the Motions are GRANTED in part and DENIED in
the March 30th Order comprehensively set forth the factual
and legal background (at least as to Wieck's
claims), the instant Order does not repeat that
background, and the court presumes a detailed familiarity
with that prior Order. This Order picks up where the March
30th Order left off, and only discusses new allegations in
the SAC as necessary to address the present Motions. The
court otherwise relies on the March 30th Order for the
background and context for the Motions. See Wieck,
308 F.Supp.3d at 1098-1104.
Similar to the FAC, the SAC alleges the following Counts:
• Count One (Breach of Contract) against Defendants
Financial Freedom and CIT Bank, N.A. (collectively sometimes
referred to as “CIT”).
• Count Two (Breach of Implied Covenant of Good Faith
and Fair Dealing) against Financial Freedom.
• Count Three (Violations of Hawaii Revised Statute
(“HRS”) § 480-2) against Financial Freedom.
• Count Four (Violations of HRS § 480-2) against
Defendants Certain Underwriters of Lloyd's, London
(“Lloyd's”); Great Lakes Reinsurance (UK),
PLC (“Great Lakes”); Seattle Specialty Insurance
Services, Inc. (“Seattle Specialty”); and
National General Lender Services, Inc., (“National
• Count Five (Tortious Interference with a Business
Relationship) against Lloyd's, Great Lakes, Seattle
Specialty, and National General, (construed as a claim for
tortious interference with contract under Hawaii law).
• Count Six (Violations of the Racketeering Influenced
and Corrupt Organizations Act (“RICO”), 18 U.S.C.
§ 1962(c)) against all Defendants.
• Count Seven (Violation of RICO, 18 U.S.C. §
1962(d) (conspiracy)) against all Defendants.
See ECF No. 104. Unlike the FAC, the SAC no longer
alleges a violation of the Truth in Lending Act
(“TILA”), 15 U.S.C. §§ 1601 et seq.,
against Financial Freedom and CIT (a claim that the March
30th Order dismissed without prejudice).
Motion to Dismiss challenges aspects of Counts One, Two,
Three, Six and Seven. ECF No. 123. Seattle Specialty and
National General's Motion to Dismiss challenges the
addition of National General as a Defendant, and Counts Five,
Six, and Seven. ECF No. 124. Similarly, Lloyd's and Great
Lakes challenge aspects of the SAC's additional
allegations in Count Four, as well as Counts Five, Six, and
Seven. ECF No. 125. Plaintiff filed an omnibus Opposition on
August 3, 2018. ECF No. 145. Replies were filed on August 17,
2018. ECF Nos. 147, 148 & 150. The court heard the
Motions on September 10, 2018. ECF No. 156.
STANDARD OF REVIEW
Rule of Civil Procedure 12(b)(6) permits a motion to dismiss
for “failure to state a claim upon which relief can be
granted[.]” A Rule 12(b)(6) dismissal is proper when
there is either a “‘lack of a cognizable legal
theory or the absence of sufficient facts
alleged.'” UMG Recordings, Inc. v. Shelter
Capital Partners, LLC, 718 F.3d 1006, 1014 (9th Cir.
2013) (quoting Balistreri v. Pacifica Police
Dep't, 901 F.2d 696, 699 (9th Cir. 1990)).
a plaintiff need not identify the legal theories that are the
basis of a pleading, see Johnson v. City of Shelby,
Mississippi, 135 S.Ct. 346, 346 (2014) (per curiam), a
plaintiff must nonetheless allege “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 Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). This tenet
- that the court must accept as true all of the allegations
contained in the complaint - “is inapplicable to legal
conclusions.” Id. 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); see also Starr v. Baca, 652 F.3d 1202,
1216 (9th Cir. 2011) (“[A]llegations in a complaint or
counterclaim may not simply recite the elements of a cause of
action, but must contain sufficient allegations of underlying
facts to give fair notice and to enable the opposing party to
defend itself effectively.”).
“[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
(citing Twombly, 550 U.S. at 556). In other words,
“the factual allegations that are taken as true must
plausibly suggest an entitlement to relief, such that it is
not unfair to require the opposing party to be subjected to
the expense of discovery and continued litigation.”
Starr, 652 F.3d at 1216. Factual allegations that
only permit the court to infer “the mere possibility of
misconduct” do not show that the pleader is entitled to
relief as required by Rule 8. Iqbal, 556 U.S. at