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 IN THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

JOHN WILKES, :

: No. 1:05-cv-586

Plaintiff, :

: Judge Jones

v. :

:

STATE FARM INSURANCE :

COMPANIES, :

 :

Defendant. :

MEMORANDUM AND ORDER

July 15, 2005

THE BACKGROUND OF THIS ORDER IS AS FOLLOWS:

Pending before the Court is a Motion to Dismiss Plaintiff’s Complaint (Rec.

Doc. 3) filed by Defendant State Farm Insurance Companies (“State Farm” or

“Defendant”). Plaintiff John Wilkes (“Wilkes” or “Plaintiff”) has filed a timely

response and the Motion is now ripe for our review. 

For the following reasons, we will grant Defendant’s Motion in part and

deny it in part, and we will permit the Plaintiff to file an amended complaint.

STANDARD OF REVIEW:

In considering a motion to dismiss, a court must accept the veracity of a

plaintiff's allegations. See Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); see also

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 We note that neither party submitted this figure in their submissions related to

Defendant’s Motion to Dismiss. Rather, it was gleaned from Defendant’s statement in the Joint

Case Management Plan. (See Rec. Doc. 8). 

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White v. Napoleon, 897 F.2d 103, 106 (3d Cir. 1990). In Nami v. Fauver, 82 F.3d

63, 65 (3d Cir. 1996), our Court of Appeals for the Third Circuit added that in

considering a motion to dismiss based on a failure to state a claim argument, a

court should "not inquire whether the plaintiffs will ultimately prevail, only

whether they are entitled to offer evidence to support their claims." Furthermore,

"a complaint should not be dismissed for failure to state a claim unless it appears

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 (1957);

see also District Council 47 v. Bradley, 795 F.2d 310 (3d Cir. 1986). 

STATEMENT OF FACTS:

This action stems from a renters’ insurance policy (the “Policy”) that the

Plaintiff purchased to cover his rental residence in Dickson City, Pennsylvania. On

November 29, 2003 the furnace in Plaintiff’s apartment allegedly “blew back” a

significant amount of soot, debris, and “other noxious and poisonous materials”

throughout his apartment. (Cmplt. ¶ 5). Immediately, Wilkes initiated a claim on

the Policy with the Defendant. 

In response to Plaintiff’s claim, State Farm paid $3580.64.1

 However,

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Plaintiff alleges that he has made additional claims against the Policy that have not

been reimbursed. Among them are a claim that Defendant has failed to reimburse

Plaintiff for: “personal property [] damage[, and ...] respiratory and skin problems.” 

Additionally, Plaintiff alleges that Defendant failed to reimburse certain expenses

related to Plaintiff’s move from his apartment because of lingering effects from the

“blow back.” 

On September 23, 2004, a State Farm representative visited Wilkes’

apartment to investigate the damage, and on October 5, 2004 Wilkes submitted to

State Farm an “opinion from a treating physician” stating that to remain in the

apartment would be hazardous to his health. (Cmplt. ¶ 11). State Farm has not

countered any of this evidence in its Motion.

After State Farm refused to reimburse these expenses, Plaintiff filed suit in

the Lackawanna County Court of Common Pleas on February 22, 2005. 

Subsequently, Defendant removed the case to this court, pursuant to 28 U.S.C. §

1446(b). Diversity jurisdiction is proper in this Court pursuant to 28 U.S.C. §

1332.

DISCUSSION:

In its Motion, Defendant contends that Plaintiff’s complaint should be

dismissed for three reasons: (1) that Plaintiff has failed to state a claim for breach

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 Defendant states, without any precedential or statutory support, that "it should be

incumbent upon the moving party to attach the insurance contract and/or at least set forth

sufficiently the policy language at issue." (Br. Supp. Mot. Dismiss at 3-4). While we agree that

it might be prudent for a plaintiff to submit a contract when bringing a contract action, we are

equally as unable as the Defendant to find case law mandating such a submission. Further,

Federal Rule of Civil Procedure 10(c), which governs attachments to a complaint and other

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of contract, (2) that Plaintiff has failed to state a valid claim for bad faith; and (3)

that Plaintiff has failed to state a valid claim for intentional infliction of emotional

distress. 

It is undisputed that the Policy was delivered to the Wilkes at his apartment

in Pennsylvania. We thus apply Pennsylvania law to this action, because

Pennsylvania’s choice of law rules provide that courts apply the insurance laws of

the state in which the policy was delivered. See Frog, Switch & Mfg. Co. v.

Travelers Ins. Co., 193 F.3d 742, 746 (3d Cir. 1999). 

We will now proceed to address each of State Farm’s contentions in turn. 

A. Breach of Contract Claim

Defendant contends that Plaintiff has failed to state a cognizable claim for

breach of contract. To satisfy its burden of pleading in a breach of contract claim,

a plaintiff must, at a minimum, plead facts establishing: (1) the existence of a

contract, including its essential terms; (2) a breach of contract; and, (3) resultant

damages. J.F. Walker Co., Inc. v. Excalibur Oil Grp., Inc., 792 A.2d 1269, 1272

(Pa.Super. Ct. 2002).2

 Our inquiry under this test may cease at the first prong, as

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pleadings, is a permissive rather than mandatory rule. 2 James Wm. Moore et al., Moore's

Federal Practice § 10.05[4] (3d ed. 1999)(citing United States v. Vernon, 108 F.R.D. 741, 742

(D.Fla. 1986)(no dismissal when plaintiff failed to attach contract sued upon)). We do not agree

that such an attachment is necessary, although it is no doubt useful for all parties to be able to

refer to the contract in resolving the dispute.

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Plaintiff’s complaint fails to state any of the contract’s (or in this case, the

Policy’s) essential terms. Until we can see the essential terms of the insurance

contract, we cannot evaluate whether Plaintiff has stated a valid cause of action for

breach of contract. Therefore, we will allow the Plaintiff twenty (20) days to

amend his complaint to show the “essential terms” of his insurance contract with

the Defendant that establish a breach of contract. 

While as noted there exists no strict requirement that the insurance contract

be attached to a complaint sounding in breach, at minimum Plaintiff is cautioned

that it is necessary for him to recite within his amended pleading those provisions

of the contact which he alleges have been breached by Defendant. Failure to do so

will necessarily result in the dismissal of this count upon an appropriate renewal of

the Defendant’s Motion to Dismiss.

B. Bad Faith Claim

 Defendant next moves to dismiss Plaintiff’s bad faith claim. Although no

cause of action exists at common law for a bad faith claim against an insurer, in

1990 Pennsylvania enacted 42 Pa. Cons. Stat. § 8371, which states:

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In an action arising under an insurance policy, if the court finds that

the insurer has acted in bad faith toward the insured, the court may

take all of the following actions:

(1) Award interest on the amount of the claim from the date

the claim was made by the insured in an amount equal to

the prime rate of interest plus 3%.

(2) Award punitive damages against the insurer.

(3) Assess court costs and attorney fees against the insurer.

(emphasis added). This statute was intended to mirror the Pennsylvania Supreme

Court’s opinion in D’Ambrosio v. Pennsylvania Nat’l Mut. Casualty Ins. Co., 431

A.2d 966 (Pa. 1981). The Pennsylvania courts, in defining “bad faith,” have

adopted the definition found in Black’s Law Dictionary for this phrase:

"Bad faith" on part of insurer is any frivolous or unfounded refusal to

pay proceeds of a policy; it is not necessary that such refusal be

fraudulent. For purposes of an action against an insurer for failure to

pay a claim, such conduct imports a dishonest purpose and means a

breach of a known duty (i.e., good faith and fair dealing), through

some motive of self-interest or ill will; mere negligence or bad

judgment is not bad faith. 

Terletsky v. Prudential Property and Casualty Ins. Co., 649 A.2d 680, 688 (Pa.

Super. Ct. 1994)(quoting Black's Law Dictionary 139 (6th ed.1990)). The party

attempting to prove bad faith, in this case Wilkes, must do so by “clear and

convincing” evidence. Cowden v. Aetna Cas. & Sur. Co., 134 A.2d 223, 229 (Pa.

1957)(“bad faith must be proven by clear and convincing evidence and not merely

insinuated”). Therefore, the obvious question before the Court is whether

Defendant’s actions in not settling Plaintiff’s claims “breach[ed] a known duty”

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where done in a malicious manner that went beyond “mere negligence or bad

judgment.” MGA Ins. Co. v. Bakos, 699 A.2d 751, 754-55 (Pa. Super Ct. 1997). 

To determine whether bad faith exists, we apply a two part test. See Klinger

v. State Farm Mut. Auto. Ins. Co., 115 F.3d 230, 233 (3d Cir. 1997)(citing

Terletsky v. Prudential Property & Cas. Ins. Co., 649 A.2d 680, 688 (Pa. Super. Ct.

1995). Both elements of the Terletsky test must be satisfied by clear and

convincing evidence: “(1) whether the insurer lacked a reasonable basis for

denying benefits; and (2) whether the insurer knew or recklessly disregarded its

lack of reasonable basis in denying the claim.” Id.; see also Keefe v. Prudential

Property & Cas. Ins. Co., 203 F.3d 218, 225 (3d Cir. 2000).

Based on the allegations in the complaint, we believe that both prongs of this

test have been satisfied. First, Plaintiff alleges that he both sent State Farm

documentation from a physician of his illness and its relationship to the “blow

back.” Second, Plaintiff also alleges that a claims representative of Defendant

examined the subject apartment. Despite these events, State Farm rejected

Plaintiff’s claim for reasons not apparent from the record before us. What we do

know, however, is that Plaintiff has alleged that this denial was in violation of the

bad faith statute. At minimum, Wilkes alleges that State Farm disregarded his

doctor’s notice that he had suffered illness as a result of the “blow back.” This

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 In fact, there is an ongoing dispute as to whether this tort exists at all in Pennsylvania

law. See Hoy v. Angelone, 720 A.2d 745, 753-54 n.10 (Pa.1998). Like so many other courts,

we conclude that it is not necessary for us to resolve this dispute in the case sub judice. See, e.g.,

Reeves v. Middletown Athletic Ass'n, 866 A.2d 1115 (Pa. Super. Ct. 2004).

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satisfies the requirements under the federal rules to state a claim upon which relief

may be granted if in fact State Farm disregarded Wilkes’ doctor’s note. From the

allegations, it is possible that State Farm lacked a reasonable basis if it had no

evidence to counter the doctor’s note. As such, we cannot dismiss the bad faith

claim at this early juncture.

It is important to note that the discovery process may reveal that Defendant

had a reasonable basis for denying benefits. Moreover, proving bad faith can be an

arduous task, and one which requires the development of specific facts. 

Accordingly, it is simply improvident for the Court to deny Plaintiff the right to

further litigate his bad faith claim, no matter how difficult his burden may be. 

C. Intentional Infliction of Emotional Distress

Finally, Defendant moves to dismiss Plaintiff’s claim for intentional

infliction of emotional distress. Claims for intentional infliction of emotional

distress have rarely been permitted to proceed in Pennsylvania.3

 As a panel of the

Superior Court recently explained, this tort is only cognizable:

‘[W]here the conduct has been so outrageous in character, and so

extreme in degree, as to go beyond all possible bounds of decency,

and to be regarded as atrocious, and utterly intolerable in a

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civilized society.’ Generally, ‘the case is one in which the recitation

of the facts to an average member of the community would arouse his

resentment against the actor, and lead him to exclaim, 'outrageous'.’ 

Id.

Baselice v. Franciscan Friars Assumption BVM Province, Inc., – A.2d –, 2005 WL

1538998, *8 (Pa. Super. Ct. July 1.,2005)(quoting Strickland v. University of

Scranton, 700 A.2d 979, 987 (Pa. Super. Ct. 1997))(emphasis added). At first, it

may appear that this is a jury question, and thus not subject to dismissal at this

stage of the proceeding. However, Pennsylvania courts have long held that an

initial review of this factual question by the court is appropriate. Johnson v.

Caparelli, 625 A.2d 668, 671 (Pa. 1993)(“With regard to the element of

outrageousness, it is for the court to determine in the first instance whether the

defendant's conduct may reasonably be regarded as so extreme and outrageous to

permit recovery.”). Notably, a plaintiff must allege some sort of physical harm

suffered as a result of the Defendant’s infliction of emotional distress. Fewell v.

Besner, 664 A.2d 577, 582 (Pa. 1995). 

It is clear to us that even assuming that Plaintiff prevails in his bad faith

claim, it will not provide an appropriate predicate for this tort:

It has not been enough that the defendant has acted with an intent

which is tortious or even criminal, or that he has intended to inflict

emotional distress, or even that his conduct has been characterized by

'malice,' or a degree of aggravation which would entitle the plaintiff to

punitive damages for another tort.

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Comment d., Restatement (Second) of Torts § 46; see, e.g., Kazatsky v. King

David Memorial Park Inc., 527 A.2d 988, 991 (Pa. 1987). Plaintiff has simply

stated in his complaint that “State Farm has intentionally and/or recklessly inflicted

extreme emotional distress.” (Cmplt. ¶ 23). He neither states how the Defendant’s

conduct was “atrocious” or “utterly intolerable” nor states what physical harm he

suffered as a result of this alleged distress. Rather, it appears to us that Plaintiff’s

counsel determined, through a degree of inspiration and creativity, that an

additional claim for intentional infliction of emotional distress ought to be added to

the mix. While we admire such creativity, we can envision no circumstances

where this tort would be occasioned by a denial of an insurance claim.

We therefore find that Plaintiff has failed to allege an appropriate claim for

intentional infliction of emotional distress, and we will thus grant Defendant’s

Motion to Dismiss as it pertains to Count III of Plaintiff’s complaint.

THEREFORE, IT IS HEREBY ORDERED THAT:

1. Defendant’s Motion to Dismiss (Rec. Doc. 3) is GRANTED to the

extent that Count III of Plaintiff’s complaint, alleging intentional

infliction of emotional distress, is DISMISSED with prejudice.

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2. Defendant’s Motion to Dismiss (Rec. Doc. 3) is DENIED in all other

respects.

3. Plaintiff shall have twenty (20) days to amend Count I of his

complaint so that at minimum it states the essential terms of the

contract that the Defendant is alleged to have breached.

4. At the expiration of these twenty (20) days or the filing by the

Plaintiff of an amended complaint, Defendant shall file either a

renewed motion to dismiss Count I or an answer, in accordance with

the Federal Rules of Civil Procedure.

S/ John E. Jones III 

John E. Jones III

United States District Judge

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