Chacon v. State Farm Automobile Insurance Company, 2:16-cv-00965

Plaintiff Gerardo Chacon was rear-ended in 2012; primary tortfeasor’s liability limits were insufficient and Chacon sought underinsured motorist (UIM) benefits under his State Farm policy with $100,000/$300,000 limits.
Chacon submitted proof of claim showing approximately $86,821 in medical bills and demanded policy limits; State Farm later offered only $7,020 for certain medical specials under the UIM policy.
Chacon sued asserting four claims: (1) Breach of Contract, (2) Breach of the Duty of Good Faith (bad faith), (3) Negligence, and (4) Negligence per se (based on NRS 686A.310 et seq. and related regulations).
Defendant moved to dismiss only Counts III and IV (negligence and negligence per se), arguing those tort theories are not legally cognizable given the statutory and common-law remedies for insurance bad faith and statutory insurer misconduct.
The district court treated the factual allegations as true for Rule 12(b)(6) purposes and focused on whether negligence/negligence-per-se claims may lie where a statutory private right and a specific bad-faith tort already exist.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether negligence/negligence per se claims may be pleaded for insurer conduct that the statute (NRS 686A.310) and common-law bad-faith tort already address	Chacon: Nevada law does not preclude a common-law negligence remedy here; Insco supports recognizing negligence where statutes don’t preclude it	State Farm: Statutory private right under NRS 686A.310 and the common-law bad-faith tort supply the exclusive remedies; permitting negligence per se would duplicate statutory relief and conflict with legislative intent	Court: Dismissed Counts III and IV; when a statute provides a private right and the legislature has defined remedies, a separate negligence/negligence-per-se tort for the same duties is precluded; plaintiff may amend to plead statutory claims under NRS 686A.310

Faulkner v. ADT Security Servs., 706 F.3d 1017 (9th Cir. 2013) (pleading standard and accepting well-pleaded factual allegations on a motion to dismiss)
Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (plausibility standard for Rule 12(b)(6) dismissal)
Powers v. United Services Auto. Ass'n, 962 P.2d 596 (Nev. 1998) (elements of a bad-faith refusal-to-pay claim)
Pemberton v. Farmers Ins. Exchange, 858 P.2d 380 (Nev. 1993) (recognition of implied covenant of good faith and fair dealing and test for bad faith recovery)
Sands Regent v. Valgardson, 777 P.2d 898 (Nev. 1989) (where legislature provides a statutory remedy for a public-policy violation, tort recovery may be precluded)
Insco v. Aetna Health & Life Ins. Co., 673 F. Supp. 2d 1180 (D. Nev. 2009) (discussing when negligence claims may lie alongside statutory schemes)