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Smith v. Zurich American Insurance Company

United States District Court, E.D. Missouri, Eastern Division

November 28, 2016

ROGER L. SMITH, Plaintiff,



         This matter comes before the Court on Defendant Zurich American Insurance Company's Motion to Dismiss or, in the alternative, Motion to Strike Certain Portions of Plaintiff's Second Amended Complaint. [ECF No. 29].

         I. BACKGROUND

         A. Procedural Background

         Plaintiff Roger L. Smith (“Plaintiff”) initiated this lawsuit by filing a Petition in the Circuit Court of St. Louis County. [ECF No. 1; No. 3]. On February 11, 2016, Defendant Zurich American Insurance (“Defendant Zurich”) removed this matter to this Court. [ECF No. 1; No. 4]. On July 25, 2016, Defendant Zurich filed a Motion to Dismiss, or, in the alternative, a Motion to Strike Certain Portions of Plaintiff's Amended Complaint. [ECF No. 29]. In addition to a response to the Motion, Plaintiff filed a Motion for Leave to File Second Amended Complaint on August 25, 2016, which this Court granted on August 29, 2016. [ECF No. 35; No. 37]. Plaintiff's Second Amended Complaint was filed on August 30, 2016. [ECF No. 38]. Because the Second Amended Complaint did not resolve the issues in the Motion to Dismiss, the Court allowed Defendant Zurich to assert its Motion to Dismiss against the Second Amended Complaint without re-briefing the issues.

         B. Factual Background

         This lawsuit arises out of an alleged failure of Defendant Zurich to disperse an underinsured motorist payment to Plaintiff under a comprehensive insurance coverage plan provided to Plaintiff's employer, TJX Companies, Inc. (“TJX”). This lawsuit further arises out of Defendant Zurich's alleged failure to properly notice Travelers Companies (“Defendant Travelers”), Federal Insurance Company (“Defendant Federal”), and American Insurance Company (“Defendant American Insurance Company”) of their alleged duty, as excess coverage carriers, to compensate Plaintiff for his injuries pursuant to Plaintiff's employer's commercial umbrella insurance policy agreement with Defendant Zurich. The following facts are accepted as true by this Court. Great Rivers Habitat Alliance v. Fed. Emergency Mgmt. Agency, 615 F.3d 958, 988 (8th Cir. 2010).

         For several years before December 21, 2010, Plaintiff was employed by TJX, where he served as a top-tier management executive. [ECF No. 31, pgs. 1, 2]. As an executive with TJX, Plaintiff was compensated, in part, with a comprehensive package of benefits. [ECF No. 31, pg. 2]. Among these benefits are “significant thresholds of insurance policy coverage” for motor vehicle accidents involving executive employees, while in the course and scope of their employment. [ECF No. 31, pg. 2]. These benefits were provided and described under TJX's “Total Rewards Benefits.” [ECF No. 31, pg. 2]. Plaintiff's TJX Total Rewards account number is 990566406. [ECF No. 31, pg. 2].

         On December 21, 2010, in St. Louis County, Missouri, Plaintiff was involved in a motor vehicle accident. [ECF No. 31, pg. 1]. Plaintiff's motor vehicle was struck by Marc Smith, an underinsured motorist, when he crossed into Plaintiff's traffic lane. [ECF No. 31, pg. 1; No. 38, pg. 3]. The motor vehicle Plaintiff was operating at the time of the accident was owned and insured by TJX. [ECF No. 31, pgs. 1, 4]. At the time of the accident, Defendant Zurich was TJX's insurance company. [ECF No. 31, pg. 4]. Plaintiff and Marc Smith subsequently settled their disputed claim for $25, 000, which was the policy limit of Marc Smith's liability insurance policy. [ECF No. 31, pg. 1]. At some point after the accident, Plaintiff received a worker's compensation settlement from TJX. [ECF No. 31, pg. 4].

         As a result of the accident, Plaintiff incurred actual and lost wages in excess of $2 million, actual and future medical bills in excess of $800, 000, as well as pain and suffering. [ECF No. 38, pg. 4]. As a result of these costs, further compensation was needed to cover the medical expenses. [ECF No. 31, pg. 5].

         Defendant Zurich asserts its underinsured motorist insurance coverage (“UIM”) with TJX has a policy limit of $25, 000, and when Plaintiff and Marc Smith settled, for $25, 000, Defendant Zurich's obligation was voided. [ECF No. 38, pg. 4]. However, Plaintiff contends Defendant Zurich was required, under the policy, to notify Defendants Travelers, Federal and American Insurance (“Defendants”), as excess carriers under the umbrella insurance policy, that Plaintiff had exceeded the $25, 000 limit and requested them compensate Plaintiff. [ECF. 38, pg. 4]. Plaintiff further contends because Plaintiff's medical expenses exceeded $25, 000, which was the limit under Defendant Zurich's policy coverage, and because Plaintiff properly notified Defendant Zurich Plaintiff's expenses exceeded $25, 000, Defendant Zurich failed to satisfy the terms and conditions of its insurance policy and failed to trigger excess carriers' policies (co-defendants) after Plaintiff notified Defendant Zurich. [ECF No. 38, pg. 4].

         C. Plaintiff's Counts Against Defendants

         Plaintiff contends, in Count One, Defendant Zurich breached its contractual obligation to Plaintiff by either not properly tendering Plaintiff's claims to Defendant Travelers, Defendant Federal and Defendant American Insurance Company, or by failing to satisfy its contractual obligations to Plaintiff by cooperating in Defendants Travelers', Federal's and Defendant American Insurance Company's reasonable investigation of Plaintiff's insurance claim pursuant to the insurance contracts Plaintiff had with Defendant Zurich and/or TJX. [ECF. No. 38, pg. 5]. In Count Two, Plaintiff contends Defendant Zurich breached its duty of good faith and fair dealing by vexatiously, knowingly and wantonly refusing to pay Plaintiff's equitable demands without reason or cause to do so. [ECF No. 38, pgs. 5, 6]. Finally, Plaintiff contends, in Counts Three, Four and Five, Defendants Travelers, Federal and American Insurance Company breached their respective contractual obligations with Plaintiff or TJX to pay sums if Plaintiff's damages exceeded the policy limits set forth in Defendant Zurich's policy [ECF No. 38, pgs. 6-8].


         A. ...

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