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Allstate Insurance Co. v. Auto Glass America, LLC

United States District Court, M.D. Florida, Orlando Division

September 30, 2019




         THIS CAUSE is before the Court on Defendants' Motion to Dismiss (“Motion, ” Doc. 22) and Plaintiffs' Response (Doc. 29). As set forth below, the Motion will be granted in part and denied in part.

         I. Background

         Plaintiffs are insurance companies that offer insurance policies for, among other things, automobiles. (Compl., Doc. 1, at 5). Through these insurance policies, Plaintiffs allege that they have contractual relationships with their insured customers. (Id. at 29). Defendant Auto Glass America, LLC, and its owner Charles Isaly, are alleged to be in the business of replacing automobile glass, including replacing damaged windshields. (Id. at 5).

         “Florida [law] requires that insurance companies, including Plaintiffs, cover repair or replacement of damaged windshields of their insureds who have comprehensive coverage, [and i]nsureds are not required to pay a deductible on these claims.”[1] Gov't Emps. Ins. Co. v. Clear Vision Windshield Repair, L.L.C., No. 6:16-cv-2077-Orl-28TBS, 2017 U.S. Dist. LEXIS 47353, at *2 (M.D. Fla. Mar. 29, 2017) (citing Fla. Stat. § 627.7288); (see also Doc. 1 at 8). The conflict between these parties results from these windshield replacements. (Doc. 1 at 2).

         Plaintiffs claim that Defendants “pressure” Plaintiffs' insured customers into hiring Defendants for windshield replacements.[2] (Id.). Defendants then allegedly obtain an assignment of benefits from Plaintiffs' insured customers “without the insureds' knowledge or consent.” (Id. at 4). Defendants, through the assignment of benefits, allegedly invoice Plaintiffs for the replacements, in accordance with Florida Statute § 627.7288, which provides that insured customers with comprehensive coverage do not have to pay for windshield replacements. (Id. at 2). Plaintiffs claim that these invoices are for “excessive and unreasonable amounts.” (Doc. 1 at 2). Plaintiffs assert that a typical windshield replacement done by other vendors in Florida cost an average of $350, whereas Defendants' invoices average $900. (Id. at 4). Plaintiffs also claim that in some of the replacement situations, windshield replacement was unnecessary because the damaged windshield could have been safely repaired at a lower cost. (Id.).

         Consequently, Plaintiffs have refused to pay Defendants more than what it believes are “the competitive and prevailing market rates for windshield replacements.” (Id.). As a result, Defendants have then purportedly “filed over 1, 400 lawsuits” against Plaintiffs to recover the “overages”-the difference between the invoice amount and Plaintiffs' payment. (Id.; see also Doc. Nos. 15, 16). At the time of the Complaint, Plaintiffs allege that “[t]he current amount of overages . . . exceeds $200, 000.” (Doc. 1 at 4). And Plaintiffs claim that they have “incurred litigation costs and fees in 2017 and 2018 alone exceeding $400, 000.” (Id. at 5).

         Plaintiffs filed the instant lawsuit, which asserts claims for tortious interference, violations of Florida's Deceptive and Unfair Trade Practices Act (“FDUTPA”), violations of Florida's Home Solicitation Sales Act (“FHSSA”), violations of the Federal Trade Commission's (“FTC”) Rule Concerning Cooling-off Period for Sales Made at Homes or at Certain Other Locations (“FTC Rule”), violations of the Florida Motor Vehicle Repair Act (“FMVRA”), and unjust enrichment. (See generally Doc. 1). Plaintiffs seek injunctive and declaratory relief and request actual damages. (Id.).

         Defendants move to dismiss the Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (Doc. 22 at 1). Pursuant to Rule 12(b)(1), Defendants assert what they characterize as a facial attack based on lack of Article III standing and a factual attack based on abstention grounds. (Id. at 3). Defendants also move to dismiss pursuant to Rule 12(b)(6) for failure to state a claim upon which relief can be granted. (Id. at 2).

         II. Rule 12(b)(1)

         A. Legal Standard

         Pursuant to Federal Rule of Civil Procedure 12(b)(1), a party may move to dismiss the claims against it for “lack of subject-matter jurisdiction.” “Attacks on subject matter jurisdiction . . . come in two forms: ‘facial attacks' and ‘factual attacks.'” Garcia v. Copenhaver, Bell & Assocs., M.D.'s, P.A., 104 F.3d 1256, 1260-61 (11th Cir. 1997) (quoting Lawrence v. Dunbar, 919 F.2d 1525, 1528-29 (11th Cir. 1990)). “Facial attacks challenge subject matter jurisdiction based on the allegations in the complaint, and the district court takes the allegations as true in deciding whether to grant the motion.” Morrison v. Amway Corp., 323 F.3d 920, 925 n.5 (11th Cir. 2003). “However, where a defendant raises a factual attack on subject matter jurisdiction, the district court may consider extrinsic evidence such as deposition testimony and affidavits.” Carmichael v. Kellogg, Brown & Root Servs., Inc., 572 F.3d 1271, 1279 (11th Cir. 2009). “When jurisdiction is properly challenged, a plaintiff has the burden of showing jurisdiction exists.” Kruse, Inc. v. Aqua Sun Invs., Inc., No. 6:07-cv-1367-Orl-19UAM, 2008 U.S. Dist. LEXIS 7066 (M.D. Fla. Jan. 31, 2008).

         B. Article III Standing Analysis

         Article III standing is a threshold inquiry, Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 94-95 (1998), so the Court will address it first. In order to bring a case in federal court, a plaintiff must establish standing under Article III of the United States Constitution. Lujan v. Defs. of Wildlife, 504 U.S. 555, 559-60 (1992). To establish Constitutional, or Article III, standing, a plaintiff must show: “1) that [it] personally has suffered an actual or prospective injury as a result of the putatively illegal conduct; 2) that the injury can be fairly traced to the challenged conduct; and 3) that the injury is likely to be redressed through court action.” Saladin v. City of Milledgeville, 812 F.2d 687, 690 (11th Cir. 1987).

         Defendants assert that Plaintiffs have failed to establish Article III standing because: Plaintiffs have not demonstrated that any of their claims fall within coverage of the consumer protection statutes upon which their claims are based; Plaintiffs have not established that they have suffered an injury-in-fact; and Plaintiffs have not shown a causal connection between the purported injury and the complained of conduct.

         To establish Article III standing, “it is not enough that a named plaintiff can establish a case or controversy between himself and the defendant by virtue of having standing as to just one of many claims he wishes to assert. Rather, each claim must be analyzed separately.” Griffin v. Dugger, 823 F.2d 1476, 1483 (11th Cir. 1987). Therefore, the Court proceeds to look at whether Plaintiffs have standing to bring each of the ten Counts they have asserted in the Complaint.[3]

         1.Counts II, III, IV, VII, and VIII-FDUTPA Claims

         Counts II, III, IV, VII, and VIII of Plaintiffs' Complaint are based on alleged violations of FDUTPA. FDUTPA makes illegal “[u]nfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices in the conduct of any trade or commerce.” Fla. Stat. § 501.204(1). “FDUTPA authorizes a private cause of action for actual damages by any ‘person' who has suffered a loss because of a defendant's violation of the statute.” State Farm Mut. Auto. Ins. Co. v. Feijoo, No. 1:18-cv-23329-KMM, 2019 U.S. Dist. LEXIS 93343, at *13 (S.D. Fla. June 3, 2019) (quoting Fla. Stat. § 501.211(2)). In 2001, the Florida Legislature amended FDUTPA's standing provision by replacing the word ‘consumer' with the word ‘person.' Id. “There is currently a split in authority regarding whether the 2001 amendment extended FDUTPA to non-consumers, ” and neither the Florida Supreme Court nor the Eleventh Circuit has resolved the split. Id. (collecting cases).

         Defendants assert that “Plaintiffs are not consumers involved in consumer transactions with [Defendants], ” and therefore are not covered by the protections of FDUTPA. (Doc. 22 at 5). Plaintiffs claim that the FDUTPA is not so limited. Plaintiffs are correct.

         At least three of Florida's District Courts of Appeal[4] have categorically held that “an entity [i]s not required to be a consumer in order to have standing to bring a FDUTPA claim.”[5] Feijoo, 2019 U.S. Dist. LEXIS 93343, at *14 (quoting Caribbean Cruise Line, Inc. v. Better Business Bureau of Palm Beach Cty., Inc., 169 So.3d 164, 169 (Fla. 4th DCA 2015) (collecting cases)); see also Envtl. Mfg. Sols., LLC v. Fluid Grp. Ltd., No. 6:18-cv-156-Orl-40KRS, 2018 U.S. Dist. LEXIS 131382, at *48-50 (M.D. Fla. May 9, 2018) (holding same). Absent a clear direction from the Florida Supreme Court on an issue, this Court is “bound to follow” decisions of the state's intermediate appellate courts unless there is some persuasive indication that the Florida Supreme Court would decide the issue differently. Nunez v. Geico Gen. Ins. Co., 685 F.3d 1205, 1210 (11th Cir. 2012) (citation omitted). Thus, Defendants' argument that Plaintiffs, as insurers, cannot be protected by FDUTPA fails.

         Defendants' arguments also fail regarding injury-in-fact and causal connection for the FDUTPA claims. An injury-in-fact is “‘an invasion of a legally protected interest' that is ‘concrete and particularized' and ‘actual or imminent, not conjectural or hypothetical.'” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1548 (2016) (quoting Lujan, 504 U.S. at 560). The injury must be “particularized, ” meaning it “must affect the plaintiff in a personal and individual way.” Id. (quoting Lujan, 504 U.S. at 560 n.1). Additionally, the injury must be “concrete, ” meaning “it must actually exist.” Id. The Supreme Court in Spokeo emphasized that a plaintiff cannot “allege a bare procedural violation, divorced from any concrete harm, and satisfy the injury-in-fact requirement of Article III.” Id. at 1549.

         Defendants argue that “the Complaint contains no allegations that any of [Defendants'] true consumer-customers sustained any damages, actual or otherwise, or were harmed by Defendants in any way.” (Doc. 22 at 9). Defendants miss the point. FDUTPA does not only protect consumers, as discussed above. Plaintiffs allege that they were injured by Defendants' actions in the following ways.[6] Plaintiffs claim that the average invoice for a windshield replacement done by Defendants is approximately $900, whereas the average for other glass vendors in Florida is approximately $350. Plaintiffs refusal to pay the full invoice amount has resulted in “overages” that Defendants are seeking from Plaintiffs, which exceed $200, 000. Plaintiffs also state in their Complaint that they have incurred litigation costs and fees resulting from Defendants' lawsuits against Plaintiffs seeking payment of the overages.

         While the costs of the instant lawsuit are not a cognizable injury sufficient to establish standing, Steel Co., 523 U.S. at 107-08, the underlying lawsuits (“over 1, 400” of them, (Doc. 1 at 4)) and associated expenses “exceeding $400, 000, ” (id. at 5), represent an actual concrete and particularized injury-in-fact. Sliwa v. Bright House Networks, LLC, No. 2:16-cv-235-FtM-29MRM, 2018 U.S. Dist. LEXIS 52509, at *9 (M.D. Fla. Mar. 29, 2018) (holding that “exposure to liability in [a] lawsuit constitutes a sufficient injury-in-fact”) (citing Yellow Pages Photos, Inc. v. Ziplocal, LP, 795 F.3d 1255, 1265 (11th Cir. 2015)). Plaintiffs have sufficiently alleged that they have been “expos[ed]” to liability in the underlying lawsuits. Id.

         And notably, even if the underlying lawsuits were not a cognizable injury-in-fact, Plaintiffs suggest that some of the windshield replacements were unnecessary in the first place and that “at least some of the damaged windshields could have been properly and safely repaired at a much lower cost.” (Doc. 1 at 4). Thus, Plaintiffs have alleged an injury in the form of overpaying for windshield replacements when they should have only had to pay for lower repair costs.

         Clearly, these purported injuries are fairly traceable to the alleged FDUTPA violations. Traceability is a “relatively modest” burden, Bennett v. Spear, 520 U.S. 154, 171 (1997), and “even harms that flow indirectly from the action in question can be said to be ‘fairly traceable' to that action for standing purposes.” Focus on the Family v. Pinellas Suncoast Transit Auth., 344 F.3d 1263, 1273 (11th Cir. 2003); see Lexmark Int'l, Inc. v. Static Control Components, Inc., 134 S.Ct. 1377, 1391 n. 6 (2014) (“Proximate causation is not a requirement of Article III standing, which requires only that the plaintiff's injury be fairly traceable to the defendant's conduct.”).

         The purpose of FDUTPA is to “protect the consuming public and legitimate business enterprises from those who engage in unfair methods of competition, or unconscionable, deceptive, or unfair acts or practices in the conduct of any trade or commerce.” Fla. Stat. § 501.202(2). Plaintiffs allege that Defendants' actions violated various provisions of FDUTPA. Plaintiffs then suggest that but for these actions, Plaintiffs' insured customers would either not have needed a windshield replacement-and would have only needed a repair-or would have had their windshield replaced at a lower cost. Additionally, Plaintiffs allege that but for these disputes about costs, Defendants would not have sued Plaintiffs for recovery of underpaid invoices. Thus, Plaintiffs have established the standing element of traceability.

         Defendants do not challenge the redressability element of standing, but that element is also met. “[A] favorable decision on the [FDUTPA] claim[s] will redress the injury to the extent Plaintiff recovers the monies it paid on the basis of [FDUTPA violations].” Deere Constr., LLC v. Cemex Constr. Materials Fla., LLC, 198 F.Supp.3d 1332, 1340 (S.D. Fla. 2016). Plaintiffs have established Article III standing on the FDUTPA claims, so they will not be dismissed on this basis.

         2. Counts V, VI, and X-Non-FDUTPA Claims

         As to Counts V, VI, and X, Defendants argue that if Plaintiffs lack standing under FDUTPA, then Plaintiffs also lack standing on the non-FDUTPA claims because those claims “are all premised on purported FDUTPA violations.” (Doc. 22 at 10). The Court finds this argument to be an ineffective attempt at getting these claims dismissed. While Counts VII and VIII do allege per se violations of FDUTPA as a result of the alleged non-FDUTPA statutory violations, Counts V, VI, and X allege stand-alone claims independent of FDUTPA and are adequately supported by alleged facts and legal authority. Count V is based on alleged violations of FHSSA and the FTC Rule, Count VI is based on alleged violations of FMVRA, and Count X is a common law claim for unjust enrichment. Defendants even admit that these are “stand-alone claims, ” (Doc. 22 at 10 n.10, 11, 12), but then fail to provide any argument supporting dismissal other than the vague assertion that the claims are premised on FDUTPA violations and therefore should be dismissed if Plaintiffs lack standing on the FDUTPA claims. (Doc. 22 at 10 n.10, 11, 12). Regardless, at a minimum, Plaintiffs have alleged the same injury-in-fact for Counts V, VI, and X as they have for the FDUTPA claims.[7] And, for traceability, Plaintiffs allege that if Defendants had not violated the underlying statutes, then Plaintiffs would not have suffered these injuries. As with the FDUTPA claims, Plaintiffs' injuries would be redressed with a payment of damages for monies lost resulting from the statutory violations. Accordingly, Plaintiffs have established Article III standing on the non-FDUTPA claims.

         III. Rule 12(b)(6)

         A. ...

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