David Sapuppo, Theresa Sapuppo v. Allstate Floridian Insurance Company
2014 U.S. App. LEXIS 228
| 11th Cir. | 2014Background
- After 2004–05 Florida hurricanes, the legislature enacted Chapter 2007-1 to provide state-subsidized reinsurance at below-market rates and required insurers to file rates "reflecting" savings from the subsidy.
- Allstate Floridian filed new rates on July 1, 2007 that were 41.9% higher than prior year rates despite the subsidy; the Florida Office of Insurance Regulation investigated and suspended Allstate’s authority to write new business.
- A Florida appellate ruling and subsequent negotiations resulted in Allstate agreeing to a 5.4% premium reduction effective September 4, 2008.
- David and Teresa Sapuppo (Allstate policyholders) sued in 2012 seeking disgorgement for the 14 months between Allstate’s July 2007 filing and its September 2008 reduction, asserting unjust enrichment, breach of contract, breach of fiduciary duty, and breach of implied covenant of good faith and fair dealing.
- The district court dismissed under Rule 12(b)(6) on multiple independent grounds: (1) claims barred by the filed rate doctrine; (2) no private right of action to enforce Chapter 2007-1; and (3) each claim was legally deficient on its own merits.
- On appeal, the Eleventh Circuit affirmed because the Sapuppos abandoned any challenge to the district court’s independent alternative rulings by failing to brief them adequately; therefore plaintiffs needed to overcome every independent ground to obtain reversal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the filed rate doctrine bars the claims | Sapuppo: challenge is to timing of rate reduction, not amount; doctrine inapplicable | Allstate: filed rates are regulative and shield insurer from private suits attacking filed rates | Court: Held plaintiffs raised the doctrine but also abandoned other challenges; affirmance rests on plaintiffs' abandonment of alternative grounds (filed rate doctrine discussed but not sole basis) |
| Whether a private right of action exists to enforce Chapter 2007-1 | Sapuppo: private contract and equitable claims can proceed in court; statutory right not required for breach of contract/unjust enrichment | Allstate: Florida law provides no private cause of action to enforce the statutory rate-reduction requirement | Court: Plaintiffs failed to press this issue adequately on appeal; abandonment leads to affirmance; district court correctly found no private right (alternative holdings left intact) |
| Whether unjust enrichment claim is legally sufficient | Sapuppo: retaining subsidy savings is unjust; equitable relief appropriate | Allstate: charging filed rates agreed to by insureds is not unjust enrichment | Court: Plaintiffs abandoned argument on appeal; district court’s independent dismissal of unjust enrichment stands |
| Whether breach of contract / fiduciary / implied covenant claims are viable | Sapuppo: Allstate’s delay violated contract and fiduciary duties; bad faith | Allstate: Rates are not policy terms; no fiduciary duty in setting rates; no contract breach shown | Court: Plaintiffs abandoned challenge; district court’s merits-based dismissals stand; breach of contract fails on merits because rates are not policy provisions |
Key Cases Cited
- Little v. T-Mobile USA, Inc., 691 F.3d 1302 (11th Cir.) (appellate standard: must challenge every independent ground to reverse)
- Taffet v. Southern Co., 967 F.2d 1483 (11th Cir.) (explains the filed rate doctrine and its effect)
- Allstate Floridian Ins. Co. v. Office of Ins. Regulation, 981 So. 2d 617 (Fla. 1st DCA) (upholding agency’s action that led to Allstate’s negotiated rate reduction)
- Cole v. U.S. Att’y Gen., 712 F.3d 517 (11th Cir.) (issue abandonment when not argued in the brief)