Opinion
CASE NO. 02-81164-CIV-MIDDLEBROOKS/VITUNAC
May 16, 2003
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS
Introduction
THIS CAUSE comes before the Court upon Defendant New York Life Insurance Company's Motion to Dismiss the Complaint (DE #2). The Court has reviewed the Record and is fully informed in the premises.
Plaintiff brought her claim on behalf of a class of individuals who were allegedly injured by Defendant. She sues Defendant, the underwriter for a group health insurance policy issued to the American Veterinary Medical Association Group Health and Life Insurance Trust, a trust domiciled in Illinois and established by the American Veterinary Medical Association. Plaintiff claims that a violation of Fla. Stat. § 627.6515 causes the group health insurance policy to forfeit its out-of-state exemption from Florida governance. In addition, Plaintiff alleges that the violation results in Defendant having a breached a contract with her, and provides cause for a declaratory judgment and injunctive relief.
Plaintiff purchased major medical coverage as a certificate holder under her group policy on or about August 1, 1999. At the time of her coverage, there were three premium rating groups: Standard, Standard Plus, and Standard Plus 20. Defendant states that because of her health history, Plaintiff was in the Standard Plus 20 category (i.e. with an initial premium rate that was 20% higher than the standard premium rate). Various insurance plans were offered; Plaintiff chose "Plan C," which provided for a $500 annual deductible.
In April, 2001, Plaintiff received notice from the AVMA trustees that the trustees had approved a rate adjustment for its major medical plans. Defendant claims that because of claim expenses and increasing costs, the standard rate for all major medical plans increased (including the Standard Plus and Standard Plus 20 premium rate groups). Such increases resulted in the Standard Plus class becoming 15% above standard, and the Standard Plus 20 class becoming 50% above standard.
Defendant states that premiums for the group policy at issue are "experience rated," meaning that the premiums charged to certificate holders like Plaintiff under the group policy are based on the claims experience of AVMA members and their families — and no other outside groups. Any premiums received in excess of those required to pay claims and otherwise operate the insurance program are returned to the policy holder, i.e. AVMA Trust, for the benefit of the participants in the form of lower costs or improved coverage. Nine non-salaried trustees, all veterinarians and AVMA members like Plaintiff, supervise the insurance program, approve rate increases, and provide its overall direction.
Plaintiff argues that these rate increases were discriminatory, as based on "claims history/health status," and are actionable as a breach of contract, capable of declaratory relief. Plaintiff states that Defendant forfeited the policy exemption from Florida governance, rendering the policy subject to portions of Part VII of Chapter 627 of Title XXXVII of the Florida Statutes.
Standard of Review
A motion to dismiss is appropriate when it is demonstrated "beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102 (1957). For the purpose of the motion to dismiss, the complaint is construed in the light most favorable to the plaintiff, and all facts alleged by the plaintiff are accepted as true. Hishon v. King Spaulding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232-33, 81 L.Ed.2d 59 (1984). Regardless of the alleged facts, however, a court may dismiss a complaint on a dispositive issue of law. Marshall County Bd. of Educ. v. Marshall County Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993).
Discussion
Defendant argues that both of Plaintiffs claims should be dismissed because the statutes in question do not afford Plaintiff a private right of action. The Florida Statutes provide that:
(1) Any person may bring a civil action against an insurer when such person is damaged:
(a) by a violation of any of the following provisions by the insurer:
1. Section 626.9541(1)(i), (o), or (x)
2. Section 626.9551;
3. Section 626.9705;
4. Section 626.9706;
5. Section 626.9707; or
6. Section 627.7283.
(b) By commission of any of the following acts by the insurer:
1. Not attempting in good faith to settle claims which, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward the insured and with due regard for her or his interests;
2. Making claims payments to insureds or beneficiaries not accompanied by a statement setting forth the coverage under which payments are being made; or
3. Except as to liability coverage, failing to promptly settle claims, when the obligation to settle a claim has become reasonably clear, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage. . . .See FLA. STAT. ANN. 624.155 (2003). Defendant relies heavily on the above provision, stating that because it is entitled "Civil Remedy," and appears in the "General Provisions" section of the Insurance Code, the Florida Legislature has provided a statutory right of action only for the violations of selected statutes within the Insurance Code and for certain violations of during the claims-settlement process.
The Eleventh Circuit has consistently refused to read a private right of action into state laws where state courts and legislatures have not done so. Farlow v. Union Cent. Life Ins. Co., 874 F.2d 791, 795 (11th Cir. 1989) (stating that federal courts are generally "reluctant to read private rights of action in state laws where state courts and state legislators have not done so"); Swerhun v. Guardian Life Ins. Co. of America, 979 F.2d 195 (11th Cir. 1992) (refusing to read a private right of action into a Florida Statute regulating health care); Keehn v. Carolina Cas. Ins. Co., 758 F.2d 1522 (11th Cir. 1985) (finding no private right of action existed for a violation of a provision of the Florida Insurance Code); see also Tatum v. Bokofsky, 842 F. Supp. 521, 525 (S.D. Fla. 1994) (holding that clear and specific evidence of legislative intent to create a private right of action is necessary for federal courts to find a private right of action in state law).
Nothing in the Complaint states that Plaintiffs claims relate to any of the statutes enumerated in § 624.155. Plaintiff states that Defendant violated "several Florida statutes, including, but not limited to" §§ 627.6515 ("Out-of-state groups"); 627.6675 ("Conversion on termination of eligibility"); 627.6571 ("Guaranteed renewability of coverage")-none of which appear in § 624.155. Plaintiff does not indicate whether Defendant actually violated any of the provisions actually mentioned in § 624.155. In addition, § 624.155(5) states, "[t]his section shall not be construed to authorize a class action against an insurer. . . ." Plaintiffs attempt to bring a class action based on a violation of the Florida Statutes is clearly misguided.
As no private right of action arises under the Florida Statutes that Plaintiff relies on in her Complaint, she fails to state causes of action under both Counts of the Complaint. Accordingly, it is
ORDERED AND ADJUDGED that Defendant's Motion to Dismiss the Complaint (DE #2) is hereby GRANTED, and Plaintiffs Complaint is DISMISSED WITHOUT PREJUDICE. In the event that Plaintiff wishes to file an Amended Complaint, it shall be filed no later than Friday, June 6, 2003.