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Hunter v. Riley

United States District Court, S.D. West Virginia, Charleston

January 12, 2018

MICHAEL D. RILEY, individually and in his official capacity as Commissioner of Insurance for West Virginia, and in his official capacity as a Committee Member of the National Association of Insurance Commissioners, Defendant.


          Dwane L. Tinsley, United States Magistrate Judge.

         This matter is assigned to the Honorable John T. Copenhaver, Jr., United States District Judge, and it is referred to the undersigned United States Magistrate Judge for submission of proposed findings and a recommendation for disposition, pursuant to 28 U.S.C. § 636(b)(1)(B). Pending before the court is Defendant Riley's Renewed Motion to Dismiss (ECF No. 39), which is undisputed.

         On April 20, 2015, the plaintiff, Chase Carmen Hunter (“Hunter”), filed, inter alia, a Verified Petition for Declaratory Judgment and Permanent Injunction (hereinafter “Complaint”) (ECF No. 2), contending that her non-resident West Virginia insurance license was improperly revoked after her licenses were allegedly revoked in at least two other states. Hunter seeks a declaratory judgment declaring that her West Virginia license is active and valid and an order permanently enjoining the defendant from violating state and federal law. Hunter contends that she has no other adequate remedy at law.

         This is the second civil action filed by Hunter in this court concerning the allegations contained in her Complaint, and one of many similar cases filed in federal courts around the country. (ECF No. 40 at 3) (listing other cases). Hunter voluntarily dismissed her first civil action filed in this court pursuant to Rule 41(a)(1)(A) on April 16, 2015. Notice of Dismissal, ECF No. 16, Hunter v. Riley, No. 2:14-cv-26978 (S.D. W.Va., Apr. 16, 2015). Then, on April 20, 2015, she filed the instant civil action, in which she seeks to prohibit the West Virginia Insurance Commissioner from taking adverse action against her West Virginia insurance license.[1]

         On September 30, 2016, Judge Copenhaver entered a Memorandum Opinion and Order (ECF No. 33) adopting the undersigned's Proposed Findings and Recommendation (“PF&R”) and dismissing the claims against the West Virginia Office of the Insurance Commissioner (“WVOIC”), with prejudice, but recommitting this matter to the undersigned for a determination of the status of the administrative proceedings surrounding Hunter's West Virginia insurance license and further consideration of whether abstention under Younger v. Harris, 401 U.S. 37 (1971), should apply to the claims against defendant Riley. Hunter later filed untimely objections to the PF&R (ECF No. 34), which were overruled by Judge Copenhaver on July 10, 2017 (ECF No. 45).

         On March 14, 2017, defendant Riley filed a Renewed Motion to Dismiss (ECF No. 39) and a Memorandum of Law in support thereof (ECF No. 40). The motion documents assert that, although the administrative proceedings concerning Hunter's West Virginia insurance license had been stayed upon the filing of her first lawsuit in this court, on September 2, 2016, the WVOIC sent Hunter a Notice of Hearing scheduling a hearing on October 5, 2016, at 9:30 a.m., pursuant to her request to appeal the decision not to renew her non-resident producer license under West Virginia Code § 33-12-24(c). (ECF No. 39, Ex. 1).[2] The September 6, 2016 Notice of Hearing was sent via certified mail to the address listed for Hunter on the NAIC State License Report at that time, which appears to be in Walnut, California, as well as to Hunter's business address in West Springfield, Massachusetts, and to an e-mail address, (Id.) The U.S. Postal Service provided a return receipt indicating that the certified mail sent to the Walnut, California address had been signed for by a “Justin De La Torre” (signature not completely legible) on September 6, 2016. (ECF No. 39, Ex. 2).

         However, Hunter failed to appear at the hearing on October 5, 2016. Nevertheless, the WVOIC presented evidence to Hearing Examiner Mark W. Carbone on the issue of whether the denial of Hunter's renewal application was reasonable. (ECF No. 39, Ex. 3). The Hearing Examiner ultimately found that the WVOIC had demonstrated substantial evidence to justify the decision to decline renewal of Hunter's non-resident producer license, pursuant to W.Va. Code §§ 33-12-24(b)(1), (b)(2), (b)(9), and (b)(10), and that such decision was reasonable. (Id. at 8-14). Thus, on October 2o, 2016, defendant Riley entered a Final Order adopting the Recommended Decision of the Hearing Examiner, including the findings of fact and conclusions of law therein. (ECF No. 39, Ex. 4).

         According to the defendant's motion documents, the Final Order was sent by certified mail to Hunter's address listed on the NAIC State Licensing Report in Walnut, California. A return receipt indicated that “Justin De La Torre” also signed for this certified mail on October 31, 2016. (ECF No. 39, Ex. 5). Exhibit 5 to the defendant's Motion to Dismiss also indicates that a certified mail return receipt for mail sent to Hunter's West Springfield, Massachusetts address was signed for by “Justin De La Torre” on November 3, 2016. (Id.) Pursuant to W.Va. Code § 33-2-14, Hunter had 30 days to appeal the Commissioner's Final Order to the Circuit Court of Kanawha County, which she apparently failed to do.

         However, while the state administrative proceedings were pending, and during the time in which Hunter could have pursued judicial review of the administrative decision in the West Virginia state courts, she filed an improvident interlocutory appeal of Judge Copenhaver's September 30, 2016 Memorandum Opinion and Order in the United States Court of Appeals for the Fourth Circuit. (ECF No. 35). The interlocutory appeal was dismissed for lack of jurisdiction by the Fourth Circuit on April 27, 2017. Hunter v. Riley, No. 16-2260 (4th Cir. Apr. 27, 2017). (ECF No. 41).

         Defendant Riley's Renewed Motion to Dismiss maintains that Younger abstention should prevent this federal court from exercising jurisdiction over Hunter's Complaint in this matter. (ECF No. 40 at 7-11). The Renewed Motion to Dismiss further asserts that, even if this court could exercise jurisdiction over Hunter's claims, the Complaint fails to state a claim upon which relief can be granted and defendant Riley is entitled to qualified immunity thereon because he was acting in the scope of his authority in the exercise of a discretionary function as Insurance Commissioner and Hunter cannot demonstrate that his actions violated a clearly established constitutional right or other federal law, or that he acted maliciously, fraudulently or oppressively. (Id. at 11-15).

         Hunter failed to file any response to the Renewed Motion to Dismiss. Thus, the undersigned will treat the motion as unopposed.


         Defendant Riley has filed a Motion to Dismiss (ECF No. 22), asserting this federal court should decline to exercise jurisdiction and dismiss this matter pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. The motion further asserts that Hunter's Complaint fails to state any plausible claim upon which relief can be granted and, thus, the Complaint should be dismissed under Rule 12(b)(6) of the Federal Rules of Civil Procedure. In Bell Atlantic Corp v. Twombly, 550 U.S. 544, 570 (2007), the Supreme Court observed that a case should be dismissed for failure to state a claim upon which relief can be granted if, viewing the well-pleaded factual allegations in the complaint as true, and in the light most favorable to the plaintiff, the complaint does not contain “enough facts to state a claim to relief that is plausible on its face.” While the complaint need not assert “detailed factual allegations, ” it must contain “more than labels and conclusions” or a “formulaic recitation of the elements of a cause of action.” Id. at 555.

         The Supreme Court elaborated on its holding in Twombly in Ashcroft v. Iqbal, 556 U.S. 662 (2009), a ...

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