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Hickman v. State Farm Property & Casualty Ins. Co.

United States District Court, W.D. Kentucky

November 29, 2017



          Charles R. Simpson III, Senior Judge

         This matter is before the court on motion of Plaintiffs Roderick and Amelia Hickman for leave to file an amended complaint pursuant to Fed.R.Civ.P. 15(a)(2). (DN 24.) The court will GRANT IN PART and DENY IN PART the motion.

         I. BACKGROUND

         At all times relevant to their claim, Plaintiffs Roderick and Amelia Hickman (“the Hickmans”), husband and wife, were insured under a renter's policy issued by Defendant State Farm Fire and Casualty Company (“State Farm”) that provided, in part, coverage for property loss or damage caused by both fire and theft. (Compl., DN 1-1, ¶ 7.) Plaintiffs allege that in March of 2016, a theft was committed at the location subject to this policy. (Id., ¶ 10.) Plaintiffs further allege that Roderick Hickman made a timely claim under the policy in the amount of approximately $56, 340.00. (Id., ¶ 11.)

         State Farm denied the Hickmans's claim, stating that the Hickmans had violated the “Concealment or Fraud” conditions of their insurance contract. (DN 26, Exh. 1.) State Farm explained, by letter to the Hickmans's attorney, that coverage was denied because an investigation into the Plaintiffs' claim “revealed they intentionally made material misrepresentations, gave false statements and/or fraudulent statements, all with the intent to conceal or misrepresent material facts and circumstances with this loss.” (Id.)

         In response, the Hickmans filed a Complaint in Jefferson Circuit Court claiming breach of contract, bad faith and unfair claims practices. (Compl., DN 1-1.) State Farm removed the action to this court on the basis of diversity jurisdiction. (DN 1.) Plaintiffs now seek leave to file an amended complaint to add counts for a Kentucky Consumer Protection Act (KCPA) violation, declaratory judgment, defamation, and punitive damages. (Pl.'s Mot. Am. Compl., DN 24.)


         A court should freely grant leave to amend a pleading when justice so requires. Fed.R.Civ.P. 15(a)(2). A district court may deny a motion to amend where there is “undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.” Foman v. Davis, 371 U.S. 178, 182 (1962).

         Defendant State Farm has no objection to Plaintiffs filing an amended complaint containing KCPA, declaratory judgment, and punitive damages counts. Furthermore, the court is not aware of any basis for denial, considering the abovementioned factors articulated in Foman, or for any other reason. Therefore, the court will grant Plaintiffs' motion to amend the complaint to add counts for the KCPA claim, declaratory judgment, and punitive damages.

         State Farm does, however, object to Plaintiffs adding a claim for defamation on the grounds that this amendment would be futile. A proposed amendment is deemed to be futile if the amendment could not withstand a Rule 12(b)(6) motion to dismiss. Thiokol Corp. v. Department of Treasury, State of Mich., Revenue Div., 987 F.2d 376, 382 (6th Cir. 1993). 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 At. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). While a complaint need not contain detailed factual allegations, it “requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555.

         Even accepting Plaintiffs' factual allegations as true, the court finds that a defamation claim could not survive a 12(b)(6) motion to dismiss and therefore adding the count of defamation would be futile. Defendant argues, and the court agrees, that Plaintiffs have failed to allege facts sufficient to meet the elements of a common law defamation claim. In Kentucky, defamation consists of four elements:

(a) a false and defamatory statement concerning another; (b) an unprivileged publication to a third party; (c) fault amounting at least to negligence on the part of the publisher; and (d) either actionability of the statement irrespective of special harm or the existence of special harm caused by the publication.

Toler v. Süd-Chemie, Inc., 458 S.W.3d 276, 282 (Ky. 2014) (citing Restatement (Second) of Torts ยง 558 (1977)). State Farm argues that the Hickmans's tendered amended complaint, attached to their motion for leave to file an amended complaint, does not sufficiently allege the second element of ...

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