United States District Court, S.D. West Virginia, Charleston
MEMORANDUM OPINION AND ORDER
T. COPENHAVER, JR. UNITED STATES DISTRICT JUDGE
is the motion to dismiss plaintiff s claims for negligence,
bad faith, consequential damages, attorney's fees and
costs, and other damages, filed by defendant Wright National
Flood Insurance Company on August 11, 2017.
civil action arises from a flood that occurred on June 23,
2016, causing damage to plaintiff John Collins' home.
Compl. ¶ 4. At the time of the flood, plaintiff's
home was insured with a "home owners/flood policy"
from defendant Wright National Flood Insurance
("Wright") that had been selected by defendant
First Community Bank, NA ("First Community").
See Id. at ¶ 6. Plaintiff alleges that Wright
wrongfully denied his insurance claim for damage to the first
floor of his home as a result of the flood. Id. at
¶ 8. Mr. Collins maintains that First Community
"negligently failed to secure a policy which adequately
covered plaintiff s home and collateral." Id.
at ¶ 11. He further asserts that Wright "failed to
properly insure the risk of loss, " engaged in bad
faith, and breached the insurance contract by failing to pay
damages. Id. at ¶¶ 12, 16-17. Based on
these allegations, Mr. Collins seeks damages for repairs,
clean up, and lost contents; expenses for displacement;
annoyance, aggravation, inconvenience, and loss of use
compensation; bad faith and compensatory damages;
attorney's fees, court costs, and all other relief to
which he is entitled. Id. at p. 3.
28, 2017, Mr. Collins brought this suit in the Circuit Court
of Nicholas County, West Virginia. With the consent of First
Community, Wright timely removed the action to this court on
August 4, 2017. Wright invokes this court's federal
question jurisdiction over the complaint because the
insurance policy in question is a Standard Flood Insurance
Policy issued by a Write-Your-Own Program insurance carrier
as part of the United States Government's National Flood
Insurance Program ("NFIP") pursuant to the National
Flood Insurance Act of 1968 ("NFIA"), as amended.
Notice of Removal p. 1, ¶ 2; 42 U.S.C. § 4001, et
seq.; see 44 C.F.R. § 62.23(f).
moves to dismiss plaintiff s claims for "negligence, bad
faith, consequential damages including relief for
displacement, loss of use, annoyance, aggravation and
inconvenience, attorney's fees and costs, and other
damages pursuant to state law" under Fed.R.Civ.P.
12(b)(6). Def.'s Mot. Dismiss at 1-2. These state law
claims, Wright asserts, are "preempted and barred under
federal statutory, regulatory, and common law."
Id. at 2. Wright does not, at this time, seek to
dismiss plaintiff s claim for breach of contract under the
Standard Flood Insurance Policy. Def.'s Reply at 2.
Rule of Civil Procedure 8(a)(2) requires that a pleading
"contain ... a short and plain statement of the claim
showing that the pleader is entitled to relief."
Correspondingly, Rule 12(b)(6) provides that a pleading may
be dismissed for a "failure to state a claim upon which
relief can be granted."
survive a motion to dismiss, a pleading must recite
"enough facts to state a claim to relief that is
plausible on its face." Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007); see also
Monroe v. City of Charlottesville, 579 F.3d 380, 386
(4th Cir. 2009) (quoting Giarratano v. Johnson, 521
F.3d 298, 302 (4th Cir. 2008)). In other words, the
"[f]actual allegations must be enough to raise a right
to relief above the speculative level."
Twombly, 550 U.S. at 555 (citation omitted);
see also Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) ("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."); Andrew v. Clark,
561 F.3d 261, 266 (4th Cir. 2009) (quoting Twombly,
550 U.S. at 555).
district court's evaluation of a motion to dismiss is
underlain by two principles. First, when considering a motion
to dismiss, the court "must accept as true all of the
factual allegations contained in the [pleading]."
Erickson v. Pardus, 551 U.S. 89, 94 (2007) (citation
omitted); see also Twombly, 550 U.S. at 555
("Factual allegations must be enough to raise a right to
relief above the speculative level, ... on the assumption
that all the allegations in the complaint are true (even if
doubtful in fact).") (citations omitted). In doing so,
factual allegations should be distinguished from "mere
conclusory statements, " which are not to be regarded as
true. Iqbal, 556 U.S. at 678 ("[T]he tenet that
a court must accept as true all of the allegations contained
in a complaint is inapplicable to legal conclusions.").
Second, the court must "draw all reasonable factual
inferences ... in the [nonmovant's] favor."
Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th
Cir. 1999); see also Jenkins v. McKeithen,
395 U.S. 411, 421 (1969) ("[T]he complaint is to be
liberally construed in favor of plaintiff.").
Federal Emergency Management Agency (FEMA) provides flood
insurance under the terms of the [NFIA]." 44 C.F.R. pt.
61 app. A(1), art I. Standard Flood Insurance Policies
"and all disputes arising from the handling of any claim
under the policy are governed exclusively by the flood
insurance regulations issued by FEMA, the [NFIA], and federal
common law." 44 C.F.R. pt. 61 app. A(1), art. IX.
"Federal law exclusively governs claims made on policies
issued under the [NFIP] and . . . disputes arising out of the
handling of those claims, thus preempting state law."
Woodson v. Allstate Ins. Co., 855 F.3d 628, 631 (4th
Cir. 2017). Courts have consistently held that there is no
basis for the recovery of any state law claim in cases
arising from a dispute under the NFIP. Id. at 637
("It is not surprising . . . that every other circuit to
have considered this issue has concluded that state-law
claims against write-your-own insurance providers are
preempted by federal law."); see e.g., Gallup v.
Omaha Prop. & Cas. Ins. Co., 434 F.3d 341, 344-45
(5th Cir. 2005); Wright v. Allstate Ins. Co., 415
F.3d 384, 389-90 (5th Cir. 2005); C.E.R. 1988, Inc. v.
Aetna Casualty and Surety Co., 386 F.3d 263, 268-72 (3d
Cir. 2004); Cliff v. Payco Gen. Am. Credits, Inc.,
363 F.3d 1113, 1122 (11th Cir. 2004); Gibson v. Am.
Bankers Ins. Co., 289 F.3d 943, 948-50 (6th Cir. 2002).
under a Standard Flood Insurance Policy is limited to costs
for repairing or replacing property damaged by "direct
physical loss by or from flood, " debris removal, loss
avoidance measures, and increased cost of compliance with a
state or local floodplan. 44 C.F.R. pt. 61, app A(1), art.
III. The NFIA permits policyholders to bring suit against
insurers for amounts due under the insurance contract. 42
U.S.C. § 4072; see Wright v. Allstate Ins. Co.,
500 F.3d 390, 394 (5th Cir. 2007). Consequential damages,
including attorney's fees, are not the type of loss that
is insured under the NFIP and are not recoverable in a suit
based on a breach of a Standard Flood Insurance Policy.
See Atlas Pallet, Inc. v. Gallagher, 725 F.2d 131,
139 (1st Cir. 1984); Moffett v. Computer Scis.
Corp., 457 F.Supp.2d 571, 589 (D. Md. 2006).
overwhelming weight of authority indicates that Mr.
Collins' state law claims are entirely preempted by
federal law. Furthermore, his recovery for his breach of
contract claim is limited to the relief allowed under the
Standard Flood Insurance Plan, and he cannot seek additional
damages for displacement, loss of use, ...