Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-alsd-1_06-cv-00360/USCOURTS-alsd-1_06-cv-00360-0/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1332 Diversity-Declaratory Judgement

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IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ALABAMA

SOUTHERN DIVISION

RICHARD PREIS, et al., )

 )

Plaintiffs, )

 )

v. ) CIVIL ACTION 06-0360-WS-C

 )

LEXINGTON INSURANCE COMPANY, )

et al., )

 )

Defendants. )

ORDER

This matter is before the Court on the motion of defendants T&B, Ltd., d/b/a Thames,

Batre, Mattei, Beville and Ison (“T&B”) and Allen Ladd (collectively, “the Agents”) to dismiss. 

(Doc. 19). The parties have filed briefs in support of their respective positions, (Docs. 20, 26,

35, 46, 50), and the motion is ripe for resolution. After carefully considering the foregoing

materials, the Court concludes that the motion is due to be granted, with leave to amend. 

The complaint purports to allege causes of action against the Agents for negligence, 

misrepresentation and negligent misrepresentation. (Doc. 3 at 12-13). The Agents argue that the

latter two claims fail to state a claim upon which relief can be granted because they fail to plead

fraud with the particularity demanded by Rule 9(b). 

“The particularity rule serves an important purpose in fraud actions by alerting

defendants to the precise misconduct with which they are charged and protecting defendants

against spurious charges of immoral and fraudulent behavior.” Durham v. Business Management

Associates, 847 F.2d 1505, 1511 (11th Cir. 1988); see also Friedlander v. Nims, 755 F.2d 810,

813 n.3 (11th Cir. 1985)(Rule 9(b)’s “clear intent is to eliminate fraud actions when all facts are

learned through discovery after the complaint is filed.”). Rule 9(b) challenges must be gauged in

light of the purposes the rule is designed to fulfill and not simply by an abstract fastidiousness. 

Moreover, “[t]he application of the rule must not abrogate the concept of notice pleading.” 

Durham v. Business Management Associates, 847 F.2d at 1511; accord Friedlander v. Nims,

755 F.2d at 813 n.3 (“[A] court considering a motion to dismiss for failure to plead fraud with

particularity should always be careful to harmonize the directives of rule 9(b) with the broader

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The Agents and/or the co-defendant insurer presumably know or can readily identify

when the policy was purchased. That is sufficient to fulfill the purposes of Rule 9(b) without

doing violence to the broader policy of notice pleading. The Agents can scarcely demand the

plaintiffs to provide a date they do not know, especially when the plaintiffs provide the Agents

sufficient information for them to identify the date from their own knowledge or records. 

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policy of notice pleading.”).

Rule 9(b) is satisfied if the complaint sets forth (1) precisely what statements 

were made in what documents or oral representations or what omissions were 

made, and (2) the time and place of each such statement and the person responsible 

for making (or, in the case of omissions, not making) same, and (3) the content of 

such statements and the manner in which they misled the plaintiff, and (4) what 

the defendants obtained as a consequence of the fraud.

Ziemba v. Cascade International, Inc., 256 F.3d 1194, 1202 (11th Cir. 2001)(internal quotes

omitted). The Agents identify the “elements omitted” as the time and place of the alleged

misrepresentations, the person making them on behalf of T&B, and the “means of

communication” employed (including particular document or telephone conversation). (Doc. 20

at 5-6; Doc. 35 at 2-3). The Agents make no challenge to the third and fourth portions of

Ziemba. 

The plaintiffs do not argue that their complaint satisfies the first two portions of Ziemba. 

Instead, they attempt to amplify their allegations in brief. With respect to the person making the

misrepresentations, they identify Ladd. (Doc. 46, ¶¶ 6, 8). With respect to the mode of

communication, they identify the telephone. (Id., ¶ 6). With respect to the time of the

misrepresentations, they point to the period “immediately prior” to their purchase of the subject

policy. (Id., ¶ 8).1 With respect to place, the complaint already alleges that the representations

occurred while he was in the Middle District of Alabama. (Doc. 3, ¶ 5). 

The Agents, while challenging other aspects of the plaintiffs’ response, do not suggest

that the information provided therein would fail to satisfy Rule 9(b) if incorporated within the

complaint. (Doc. 50). Accordingly, the Court concludes that, while the complaint as filed does

not satisfy Rule 9(b), an amended complaint that incorporated the information contained in the

plaintiffs’ briefing would do so. The plaintiffs have requested the opportunity to amend. (Doc.

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46 at 6).

For the reasons set forth above, the Agents’ motion to dismiss for failure to comply with

Rule 9(b) is granted. The plaintiffs’ claims against the Agents for misrepresentation and

negligent misrepresentation are dismissed, subject to the right of the plaintiffs to file and serve,

on or before August 29, 2006, an amended complaint satisfying Rule 9(b). 

DONE and ORDERED this 15th day of August, 2006.

s/ WILLIAM H. STEELE

UNITED STATES DISTRICT JUDGE

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