Howley v. Bankers Standard Insurance Company, 3:19-cv-02477

Background

Howley (homeowner) alleges June 2019 hail/wind damage to his roof and filed an insurance claim under Policy No. 268139650; an adjuster (Shawn Lopriore) allegedly closed the claim after a deficient investigation, stating damage preexisted the storm and denying/underpaying needed overhead/profit.
Howley sued Bankers Standard in state court asserting six causes of action: breach of contract; unfair/deceptive acts under the Texas Insurance Code/DTPA; breach of common-law duty of good faith and fair dealing; violation of the Prompt Payment of Claims Act (PPCA); breach of express or implied warranty; and fraud.
Bankers removed to federal court and moved to dismiss under Rule 12(b)(6); Howley did not respond to the motion and did not seek leave to amend.
The court applied Twombly/Iqbal plausibility standards and Rule 9(b) for fraud/DTPA-type claims, treating the complaint and attached/central documents as the operative pleadings.
The court found Howley’s allegations largely conclusory, often failing to identify specific contract provisions, dates, who/what/when/where/how for misrepresentations, or facts showing breach-induced damages; each claim was dismissed for failure to state a claim.
The court denied leave to further amend as futile and dismissed the action with prejudice.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Breach of contract	Howley: Bankers denied or underpaid claim under the Policy	Bankers: complaint fails to identify which policy provision was breached and offers only conclusory allegations	Dismissed — plaintiff failed to plead which contractual term was breached or sufficient facts to infer liability
DTPA / Texas Insurance Code (unfair/deceptive acts)	Howley: Bankers misrepresented coverage and the extent of damage and refused reasonable investigation, causing damages	Bankers: pleadings merely recite statutory language; lack particularity (Rule 9(b)) and fail to allege who/what/when/where/how or causation	Dismissed — allegations conclusory and fail to satisfy Rule 9(b) and causation requirements
Common-law bad faith (good faith & fair dealing)	Howley: Bankers had no reasonable basis and orchestrated a pretextual investigation to deny/underpay	Bankers: no facts showing absence of reasonable basis or extra-contractual conduct; claim depends on underlying contract breach	Dismissed — no adequate factual showing of lack of reasonable basis and claim is defeated by insufficient contract claim
Prompt Payment of Claims Act (PPCA)	Howley: Bankers failed to notify acceptance/rejection and owes statutory penalties and interest	Bankers: no dates or facts showing delay beyond statutory period; PPCA liability requires underlying contract breach	Dismissed — plaintiff failed to plead breach of contract or timing/details required for PPCA recovery
Express or implied warranty	Howley: Bankers warranted that wind/hail claims would be paid in full and promptly processed	Bankers: no particular warranty language or separate promise identified; implied warranty not supported by facts	Dismissed — no express-warranty basis pleaded and no compelling basis alleged for creating an implied warranty
Fraud	Howley: Bankers duped him into purchasing policy by concealing that it would not pay claims absent a lawsuit	Bankers: fraud not pled with particularity under Rule 9(b); no facts showing falsity, scienter, or reasonable reliance	Dismissed — fraud allegations too vague, lack the who/what/when/where/how and scienter/reliance facts
Amendment of pleadings	Howley did not request leave to amend after motion to dismiss	Bankers: oppose delay/prejudice and note deficiencies	Denied — plaintiff had opportunity, did not respond, and complaint shows no additional factual detail; further amendment would be futile

Key Cases Cited

Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (establishes the plausibility pleading standard under Rule 8)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (applies plausibility standard and distinguishes factual allegations from legal conclusions)
Higginbotham v. State Farm Mut. Auto. Ins. Co., 103 F.3d 456 (5th Cir. 1997) (elements and limits of insurer's common-law duty of good faith)
Dorsey v. Portfolio Equities, Inc., 540 F.3d 333 (5th Cir. 2008) (Rule 9(b) heightened pleading requirements for fraud-like claims)
Southland Sec. Corp. v. INSpire Ins. Solutions, Inc., 365 F.3d 353 (5th Cir. 2004) (Rule 9(b) specificity requirements: who, what, when, where, and how)
Weiser-Brown Operating Co. v. St. Paul Surplus Lines Ins. Co., 801 F.3d 512 (5th Cir. 2015) (insurer PPCA liability depends on breach of contract)
Allstate Ins. Co. v. Receivable Fin. Co., 501 F.3d 398 (5th Cir. 2007) (outlines Texas law elements of fraud)