Opinion ID: 723951
Heading Depth: 2
Heading Rank: 2

Heading: Insurance Rebates from Transamerica to the Bank

Text: 22 The plaintiffs also contend that the Bank and Transamerica entered into an agreement that provided the Bank with rebates or kickbacks for placing the insurance with Transamerica. Although the defendants argue that these sums were insurance commissions that were paid to an affiliate of the Bank, for the purposes of this review we must interpret the facts in the light most favorable to the plaintiffs. 23 The loan contract in question--i.e., subsection (b) quoted in the first paragraph of Section I of the opinion--states that in case of default Bank One may purchase limited insurance for the protection of only Bank One for the amount of my loan and may add such insurance premiums, and finance charges thereon, to my loan balance. The district court dismissed the kick back claim under § 12b(6) and § 9(b), Fed.R.Civ.P., on grounds that the amended Class Action Complaint does not allege with requisite specificity a false statement of fact on which Kenty relied in subsection (b) or elsewhere and that Kenty has failed to identify any false statement of fact with respect to the amounts charged her. Kenty is required to pay premiums and finance charges to the bank if she did not buy her own insurance. This language is not limited to the amount of money it costs the bank to buy the insurance on the automobile in question. Cost and premium are not synonymous. 24 We agree with the district court that Kenty has not alleged the particular false statement on which she relies in light of the factual basis of fraud alleged in the complaint. She does not explain why the amounts charged to her were not premiums and finance charges or how the amounts charged constitute fraud. The allegations of the complaint fail under Rule 9 to identify with particularity the statement made by the Bank in the dealings between Kenty and the bank that was untrue. Hence the misrepresentation element of fraud has not been sufficiently identified to withstand the motion to dismiss.