UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

 

CREDITORS INSURANCE 

PURCHASING GROUP, 

 Plaintiff-Appellant, 

v. 

JOHN D. DOAK, Commissioner of 

Insurance, 

 Defendant-Appellee. 

No. 13-6189 

(D.C. No. 5:12-CV-01046-F) 

(W.D. Okla.)

 

ORDER AND JUDGMENT*

 

Before PHILLIPS, McKAY, and ANDERSON, Circuit Judge. 

 

 Creditors’ Insurance Purchasing Group (CIPG) appeals from the district 

court’s order dismissing under Federal Rule of Civil Procedure 12(b)(6) its action 

against John D. Doak, Oklahoma Commissioner of Insurance. The sole issue 

presented on appeal is whether CIPG stated a plausible claim for declaratory relief 

that collateral protection insurance (CPI) is liability insurance under the definition set 

 

* After examining the briefs and appellate record, this panel has determined 

unanimously that oral argument would not materially assist the determination of this 

appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore 

ordered submitted without oral argument. This order and judgment is not binding 

precedent, except under the doctrines of law of the case, res judicata, and collateral 

estoppel. It may be cited, however, for its persuasive value consistent with 

Fed. R. App. P. 32.1 and 10th Cir. R. 32.1. 

FILED 

United States Court of Appeals 

Tenth Circuit 

July 14, 2014

Elisabeth A. Shumaker 

Clerk of Court
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out in the Liability Risk Retention Act of 1986 (LRRA), 15 U.S.C. §§ 3901-3906. 

We agree with the district court that CIPG did not state a plausible claim, and we 

therefore affirm the dismissal. 

I. BACKGROUND 

 CIPG is a risk purchasing group (RPG) under the LRRA.1

 The members of 

CIPG consist of “Buy Here, Pay Here” used car dealers/creditors, who purchase CPI 

to cover similar exposures. CPI protects the used car dealers/creditors from loss 

when their collateral—the car sold—is damaged or destroyed. See, e.g., Doe v. 

Norwest Bank Minn., N.A., 107 F.3d 1297, 1300 (8th Cir. 1997) (stating that bank’s 

CPI program included umbrella policy covering bank’s interest in collateral and 

coverage is similar to comprehensive and collision coverage, because coverage is 

limited to smaller of damage to collateral or balance due on loan). CIPG purchased 

CPI for this exposure for its members from a risk retention group (RRG).2

 

CIPG and Mr. Doak informally disputed whether CPI is liability insurance 

under the LRRA. They failed to resolve the issue, and CIPG brought suit. In its 

second amended complaint, CIPG sought a declaratory judgment that CPI is liability 

 

1

 The LRRA defines a purchasing group as a group of members with similar 

businesses in terms of the liability to which they are exposed and who purchase 

liability insurance for the group “to cover their similar or related liability exposure.” 

15 U.S.C. § 3901(a)(5)(A)-(C). 

2

 The LRRA defines RRG as “any corporation or other limited liability 

association . . . whose primary activity consists of assuming and spreading all, or any 

portion, of the liability exposure of its group members.” 15 U.S.C. § 3901(a)(4)(A). 
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insurance under the LRRA. Mr. Doak moved to dismiss under Rule 12(b)(6), 

asserting that CIPG did not plead facts showing that CPI covers legal risk for 

damages to others under the LRRA. The district court granted the motion, finding 

that CPI is not liability insurance under the LRRA because CIPG failed to allege 

facts showing that CPI protects the used car dealers/creditors from “legal liability for 

damages” to others as the LRRA requires, 15 U.S.C. § 3901(a)(2). 

II. ANALYSIS 

 We review de novo a district court’s dismissal under Rule 12(b)(6), accepting 

“as true all well-pleaded factual allegations in the complaint and view[ing] them in 

the light most favorable to [the non-movant].” SEC v. Shields, 744 F.3d 633, 640 

(10th Cir. 2014) (internal quotation marks omitted). “To survive a motion to dismiss, 

a complaint must contain sufficient factual matter, accepted as true, to state a claim 

to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) 

(internal quotation marks omitted). Also, “[w]e review the district court’s 

interpretation of a federal statute de novo.” United States ex rel. Sikkenga v. Regence 

Bluecross Blueshield of Utah, 472 F.3d 702, 710 (10th Cir. 2006) (internal quotation 

marks omitted). 

 In deciding whether the district court correctly determined that CIPG failed to 

state a plausible claim that CPI meets the definition of liability insurance under the 

LRRA, we first look to the statutory language. See Ctr. for Legal Advocacy v. 

Hammons, 323 F.3d 1262, 1267 (10th Cir. 2003) (“When interpreting the language of 
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a statute, the starting point is always the language of the statute itself.” (internal 

quotation marks omitted)). “If the language is clear and unambiguous, the plain 

meaning of the statute controls.” Id. (internal quotation marks omitted). 

 The LRRA defines “liability” in relevant part as “legal liability for 

damages . . . because of injuries to other persons, damage to their property, or other 

damage or loss to such other persons resulting from or arising out of . . . any 

business . . . , trade, product, services . . . , premises, or operations.” 15 U.S.C. 

§ 3901(a)(2)(A)(i). Under the Act, “liability” expressly “does not include personal 

risk liability and an employer’s liability with respect to its employees other than legal 

liability under the Federal Employers’ Liability Act.” Id. § 3901(a)(2)(B). 

Like the district court, we conclude that this statutory language clearly 

requires that the insured be liable for damages to another person due to damage to 

that person’s property. CIPG has no liability to another for damages. Instead, CPI is 

a first-party liability policy, where the dealers/creditors make claims with their own 

insurance company for damages to the buyer/debtor’s property, which serves as 

collateral for the dealers/creditors. CPI only insures the dealers/creditors for their 

losses. 

CIPG agrees that CPI “was designed to protect a creditor, in this case, a used 

car dealer/creditor, from any loss it might suffer when the property of another, in this 

case a car buyer, was damaged or destroyed either by the buyer or some third party.” 

Aplt. Opening Br. at 10. But it contends that the LRRA does not require liability to 
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another; rather, it only requires that the liability arise out of the damage to the 

property of another, without a third-party requirement. In other words, CIPG 

believes that “payment under a CPI policy is triggered by damage to the property of 

the buyer, ie [sic] ‘another’ under the LRRA.” Aplt. Br. at 17. CIPG, however, 

misreads the statutory requirement for “legal liability for damages . . . because 

of . . . damage to [another person’s] property.” 15 U.S.C. § 3901(a)(2)(A)(i). 

CPI protects the dealers/creditors from their own losses. At no time does CPI require 

them to pay damages to anyone. And the fact that CPI is not expressly listed as an 

exclusion under the LRRA does not change the clear requirement under the LRRA of 

liability for damages. 

Accordingly, we agree with the district court that CIPG has not asserted 

sufficient facts to state a plausible claim that CPI fits within the definition of liability 

insurance set forth in the LRRA. We therefore affirm the Rule 12(b)(6) dismissal. 

III. CONCLUSION 

 The judgment of the district court is affirmed. 

 Entered for the Court 

 Gregory A. Phillips 

 Circuit Judge