GM Property Corp. v. Capitol Specialty Insurance Corporation
1:16-cv-24315
S.D. Fla.Apr 14, 2017Background
- GM Property Corp. filed a one-count complaint against Capitol Specialty Insurance Corp.; Capitol answered and asserted 21 affirmative defenses.
- GM moved to strike all affirmative defenses under Fed. R. Civ. P. 12(f), arguing they are legally insufficient, boilerplate, and lack factual support (invoking Twombly/Iqbal standards).
- Capitol argued affirmative defenses need only give notice of additional issues per Rule 8(c) and that many defenses legitimately put GM on notice for trial and discovery.
- GM also argued several defenses were not true affirmative defenses but mere denials, and that Capitol waived its right to request appraisal by denying the claim.
- The Court reviewed each defense, found some were mislabeled (should be treated as denials), rejected the application of Twombly/Iqbal to affirmative defenses, and declined to strike the defenses as a group.
- The Court warned that Rule 11 and discovery limits can address baseless, overly broad, or frivolous defenses and reserved the right to impose sanctions if appropriate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Pleading standard for affirmative defenses | Affirmative defenses must meet Twombly/Iqbal; GM: Capitol's defenses are conclusory | Capitol: Twombly/Iqbal does not apply; Rule 8(c) only requires notice | Court: Twombly/Iqbal not applicable; Rule 8(c) notice standard controls |
| Sufficiency/notice of specific defenses | Defenses are bare legal conclusions providing no notice | Defenses give notice of issues to be litigated | Court: Most defenses (2–7,10,11,13,16–21) give adequate notice; not struck |
| Mislabeling denials as affirmative defenses | Labeled defenses that merely deny prima facie case should be stricken | Mislabeling is error but not grounds to strike; treat as denials | Court: Treat defenses 1,8,9,12,14,15 as denials rather than striking them |
| Appraisal/waiver defense | GM: Capitol waived appraisal right by denying the claim; defense should be struck | Capitol: Asserts reservation of appraisal right; issue not properly raised by GM now | Court: GM’s waiver argument is premature; appraisal reservation can remain as a defense |
| Discovery burden from broad defenses | GM: Defenses will cause excessive, wide-ranging discovery | Capitol: Complaint is narrow; discovery scope limited; Rule 11 can curb frivolous defenses | Court: Declined to strike; found discovery scope manageable and Rule 11 available to sanction abuses |
Key Cases Cited
- Hassan v. U.S. Postal Serv., 842 F.2d 260 (11th Cir. 1999) (Rule 8(c) requires notice of additional issues to prepare for trial)
- Paylor v. Hartford Fire Ins. Co., 748 F.3d 1117 (11th Cir. 2014) (discusses scope and conduct of discovery in insurance contexts)
- Johnson Enters. of Jacksonville, Inc. v. FPL Grp., Inc., 162 F.3d 1290 (11th Cir. 1998) (addresses discovery burdens and proportionality)
- Allapattah Servs., Inc. v. Exxon Corp., 372 F. Supp. 2d 1344 (S.D. Fla. 2005) (Rule 11 sanctions appropriate for legally and factually frivolous affirmative defenses)