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Date: 08-19-2022

Case Style:

USAA Casualty Insurance v. Linda Scobee, et al.

Case Number: 4:21-cv-00779

Judge: Jean C. Hamilton

Court: United States District Court for the Eastern District of Missouri (St. Louis County)

Plaintiff's Attorney: Jean-Paul Assouad, John A. Little, Jr. and Michael D. Mulvaney

Defendant's Attorney:

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Description: St. Louis, Missouri civil litigation lawyer represented Defendants who were sued by Plaintiff on seeking a declaratory judgment relating to coverage.

On April 4, 2015, Michael Scobee, a resident of Missouri, was riding his motorcycle when he was struck by an automobile driven by William C. Norris, who was a resident of Kentucky at the time of the collision. Mr. Scobee was seriously injured in the crash, and his medical expenses totaled over $900,000.00. The collision occurred in Jefferson County, Kentucky, and Mr. Scobee was treated for his injuries at the University of Louisville Hospital. At the time of the accident, Mr. Norris was insured under an automobile policy issued by USAA in Kentucky.

Michael Scobee and his wife Linda Scobee sued Mr. Norris in the Western District of Kentucky, and served USAA with a copy of the lawsuit they had filed against its insured on December 7, 2015. Soon thereafter, the Scobees learned that Mr. Norris had moved to Missouri, and they chose to dismiss the Kentucky case and refiled their claims in the Circuit Court of St. Louis County, Missouri, on May 2, 2016. Mr. Norris died on September 16, 2018, and an attorney was appointed defendant ad litem for purposes of the lawsuit. However, approximately one week before trial in the matter, Mr. Norris's wife Lauren Norris was substituted as defendant ad litem. USAA was never a party to the Missouri action.

On September 27, 2019, a jury returned a verdict of $6,500,000.00 for Michael Scobee and $500,000.00 for Linda Scobee. Following trial, USAA sent a letter to the Scobees stating that it was “offering payment of the $100,000.00 policy limits as full satisfaction of the judgment,” asserting that $100,000.00 was all it need pay “due to the nature of the obligations of a defendant ad litem under Missouri law.” Defendant ad litem, Lauren Norris, sought to have the judgment amended downwards to limit the damages to only those covered by liability insurance pursuant to Mo. Rev. Stat. § 537.021. The trial court denied her motion, and upon appeal, the Missouri Court of Appeals also denied her request, construing her request as pertaining to issues of insurance coverage and collections that were not before the court in the Scobees's tort action. See Scobee v. Norris, 620 S.W.3d 262, 266 (Mo.Ct.App. 2021). The Missouri Supreme Court subsequently denied the parties' application for transfer on May 4, 2021. Id. USAA then filed a Motion for Leave to Deposit Money [$100,000.00] in the Registry of the Court and for the Court to Enter Satisfaction of Judgment, which the trial court denied on June 21, 2021. Id.

On June 28, 2021, USAA filed the instant action for declaratory judgment, naming the Scobees and Lauren Norris as Defendants, and seeking declarations from the Court on two counts: (i) that the Scobees's recovery is limited under Mo. Rev. Stat. § 537.021 to the proceeds available under the Policy, which contains a limit of liability of $100,000.00, and (ii) that there is no possibility of recovery by Defendants in excess of the stated Policy limits, including by a claim for bad faith. Plaintiff asserts that under Missouri law, a third party may not pursue a direct action for bad faith failure to settle against an insurer absent an assignment from the insured, and no insured under the Policy ever assigned a bad faith claim to the Scobees. Plaintiff additionally argues that under Missouri law, a defendant ad litem may not assert claims that belong to Mr. Norris's estate, and Lauren Norris has no claim for bad faith that could be assigned to the Scobees.

Approximately three months after Plaintiff filed this declaratory action, the Scobees filed a bad faith claim in the Circuit Court of Franklin County, Kentucky, alleging that USAA had violated Kentucky's Unfair Claims Settlement Practices Act by failing to settle the underlying lawsuit between the Scobees and Norrises. Doc. [13-1]. Defendants then filed their motion to dismiss the instant action before this Court, arguing that it should be dismissed because (i) the Eastern District of Missouri is not the proper forum for the action; (ii) the case presents issues identical to those already decided by Missouri state court; (iii) Count II of the action seeks an improper advisory opinion; and (iv) allowing the case to proceed would interfere with the Scobees's bad faith claim that they wished to pursue in Kentucky.
USAA Cas. Ins. v. Scobee (E.D. Mo. 2022)

* * *

Young v. City of St. Charles, 244 F.3d 623, 627 (8th Cir. 2001) (citing Neitzke v. Williams, 490 U.S. 319, 326-27 (1989)). A pleading is deficient and may be dismissed under Rule 12(b)(6) if a plaintiff fails “to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). Rule 12(b)(6) is read in conjunction with Rule 8(a), which requires “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). To survive a motion to dismiss for failure to state a claim, a plaintiff's allegations 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 Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Rule 8 “does not require ‘detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Id. (quoting Twombly, 550 U.S. at 555).

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.” Id. (citing Twombly, 550 U.S. at 556). “The plausibility standard is not akin to a ‘probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. (quoting Twombly, 550 U.S. at 556). The complaint “must contain either direct or inferential allegations respecting all the material elements necessary to sustain recovery under some viable legal theory,” and “enough fact[s] to raise a reasonable expectation that discovery will reveal evidence of [each element].” Twombly, 550 U.S. at 562. The reviewing court must accept the plaintiff's factual allegations as true and construe them in the plaintiff's favor, but it is not required to accept the legal conclusions that plaintiff draws from the facts alleged. Iqbal, 556 U.S. at 678; Retro Television Network, Inc. v. Luken Commc'ns, LLC, 696 F.3d 766, 768-69 (8th Cir. 2012). A court must “draw on its judicial experience and common sense,” and consider the plausibility of the plaintiff's claim as a whole, not the plausibility of each individual allegation.

Zoltek Corp. v. Structural Polymer Grp., 592 F.3d 893, 896 n.4 (8th Cir. 2010) (quoting Iqbal, 556 U.S. at 679).
USAA Cas. Ins. v. Scobee (E.D. Mo. 2022)

Outcome: Accordingly, IT IS HEREBY ORDERED that Defendants' Motion to Dismiss Plaintiff's Amended Complaint is denied.

Plaintiff's Experts:

Defendant's Experts:


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