Court Opinion

ID: 614329
Source: CourtListenerOpinion
Date Created: 2011-09-29 00:04:57+00
Date Added: 2024-06-11T17:50:29.470647
License: Public Domain

NOT PRECEDENTIAL

                      UNITED STATES COURT OF APPEALS
                           FOR THE THIRD CIRCUIT
                                _____________

                                     No. 11-1379
                                    _____________

                          JACK DANIELS MOTORS, INC.,
                                                 Appellant

                                           v.

             UNIVERSAL UNDERWRITERS INSURANCE COMPANY
                           ______________

             APPEAL FROM THE UNITED STATES DISTRICT COURT
                    FOR THE DISTRICT OF NEW JERSEY
                        (D.C. Civ. Action No. 10-cv-5376)
                   District Judge: Honorable Stanley R. Chesler
                                 ______________

                      Submitted Under Third Circuit LAR 34.1(a)
                                 September 22, 2011
                                  ______________

         Before: FISHER, HARDIMAN, GREENAWAY, JR., Circuit Judges.

                         (Opinion Filed: September 28, 2011)
                                  ______________

                                      OPINION
                                   ______________

GREENAWAY, JR., Circuit Judge.

      Appellant, Jack Daniels Motors, Inc. (“Jack Daniels”), seeks review of the District

Court’s decision granting the motion to dismiss filed by Universal Underwriters

Insurance Company (“Universal”). For the reasons set forth below, we will affirm the
District Court’s decision.

                                       I. Background

         We write primarily for the benefit of the parties and recount only the essential

facts. Jack Daniels is a car dealership that sells Audis and other cars. Jack Daniels filed

a claim on its insurance policy with Universal, based on the policy’s crime coverage

provision. The scheme leading to the claim involved two employees of Jack Daniels,

who submitted fraudulent customer surveys to Audi. The fraudulent surveys, when

combined with genuine customer surveys, made it appear as if Jack Daniels had qualified

for a performance bonus issued by Audi. Upon discovery of the fraudulent surveys, Audi

removed the tally of the fraudulent surveys and recalculated whether Jack Daniels

qualified for the performance bonus. Jack Daniels did not qualify. Audi did not pay the

bonus.

         Jack Daniels urged that the fraud in which its employees engaged fell within the

parameters of the crime coverage provision of its insurance policy. Jack Daniels sought

to recover from Universal the amount of the performance bonus, which it would have

received if the fraudulent reviews were valid or if the surveys Jack Daniels obtained on

its own, after discovery of the fraud, were included.

         Universal declined to pay the claim, and Jack Daniels sought relief in the District

Court. Concluding that the potential bonus did not fall within the definitions in the crime

coverage provision of the policy, the District Court granted Universal’s motion to

dismiss, with prejudice.
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                         II. Jurisdiction and Standard of Review

       The District Court had jurisdiction, pursuant to 28 U.S.C. § 1332. We have

jurisdiction, pursuant to 28 U.S.C. § 1291.

       We exercise plenary review over a district court’s grant of a motion to dismiss,

pursuant to Federal Rule of Civil Procedure 12(b)(6), for failure to state a claim. Grief v.

Klem, 591 F.3d 672, 676 (3d Cir. 2010).

       AIn deciding a motion to dismiss, all well-pleaded allegations of the complaint

must be taken as true and interpreted in the light most favorable to the plaintiffs, and all

inferences must be drawn in favor of them.@ McTernan v. City of York, 577 F.3d 521,

526 (3d Cir. 2009). To withstand a Rule 12(b)(6) motion to dismiss, Aa complaint must

contain sufficient factual matter, accepted as true, to state a claim to relief that is

plausible on its face.@ Ashcroft v. Iqbal, --- U.S. ----, 129 S. Ct. 1937, 1949 (2009)

(internal quotation marks omitted).

                                       III.    Analysis

       Jack Daniels argues that the District Court erred in granting the motion to dismiss

by reading the insurance policy too narrowly and failing to consider Jack Daniels’s

reasonable expectations regarding the extent of coverage. We disagree and will affirm

the District Court’s decision for the reasons set forth in its opinion.

       We note that the courts in New Jersey have recognized that an insured’s

reasonable expectations regarding the extent of coverage should be considered, but only

in situations where “misleading terms and conditions of insurance” exist. DiOrio v. New
                                                3
Jersey Mfrs. Ins. Co., 398 A.2d 1274, 1280 (N.J. 1979). When that occurs, “genuine

ambiguities are resolved against the insurer.” Id. We agree with the District Court that

no ambiguities exist, and that the terms of the policy, as written, should be applied.

       Jack Daniels also argues that the District Court should have allowed discovery to

proceed in order to allow Jack Daniels to identify facts in support of its claim. No

amount of discovery would change the definitions and coverage set forth in the policy.

Jack Daniels’s policy only covered losses involving money, securities, and revenue and

other stamps. The performance bonus, which Jack Daniels had hoped to earn, does not

fall within any of these defined terms, under their ordinary meaning, as the District Court

aptly determined. Therefore, there was no reason to allow the complaint to proceed to

discovery.

                                     IV. Conclusion

       We will affirm the decision of the District Court.

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