Joseph J. Broadway v. State Farm Mutual Automobile Insurance Company
683 F. App'x 801
| 11th Cir. | 2017Background
- Broadway's car was struck by a negligent driver; he recovered $25,000 from the at-fault carrier. His State Farm policy included UIM coverage with $25,000 limits. State Farm offered $5,000 for Broadway's UIM claim.
- Broadway sued in Alabama state court alleging breach of contract, bad faith, and fraud (against State Farm and its agent Anderson). State Farm removed based on diversity.
- The district court dismissed the fraud claims for failure to state a claim, denied remand, denied leave to amend, and granted summary judgment for State Farm on breach and bad-faith claims; Broadway appealed.
- The alleged fraud theory against the non-diverse agent relied on State Farm’s advertising slogan (“like a good neighbor, State Farm is there”) and general assertions about a pattern of misconduct.
- At summary judgment, factual dispute remained over the extent of Broadway’s damages; State Farm had valued the claim at $20–30k and made an initial $5,000 offer; Broadway cashed the check but submitted no additional evidence of damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether court should remand because of fraud claim against non-diverse agent | Broadway: Anderson committed actionable fraud based on State Farm’s slogan and representations | State Farm: slogan is puffery; plaintiff cannot state fraud against Anderson; removal proper | Court: slogan is non-actionable puffery; fraud claim fails; diversity jurisdiction exists; remand denied |
| Whether to allow leave to amend complaint to replead fraud | Broadway: proposed amended fraud would cure defects | State Farm: amendment is futile and barred by earlier dismissal | Court: amendment futile; earlier dismissal bars similar fraud claim; leave denied |
| Whether proposed claims for fraudulent suppression and negligent procurement against agent state claims | Broadway: agent concealed material facts and failed to advise higher UIM limits | State Farm: allegations are conclusory; no showing agent knew concealed facts or breached duty to procure requested coverage | Court: suppression claim fails for lack of alleged knowledge and material facts; negligent procurement fails for lack of duty/breach allegations; both would be dismissed |
| Whether summary judgment on breach of contract and bad faith was proper | Broadway: entitled to full UIM limits; State Farm acted in bad faith | State Farm: extent of damages was disputed; plaintiff not yet "legally entitled to recover"; claim premature | Court: damages unresolved when suit filed; under Alabama law breach/bad-faith claims were unripe — summary judgment/dismissal without prejudice affirmed |
Key Cases Cited
- Henderson v. Wash. Nat'l Ins. Co., 454 F.3d 1278 (11th Cir.) (standards for fraudulent joinder and remand)
- Allstate Ins. Co. v. Eskridge, 823 So. 2d 1254 (Ala.) (fraud requires misrepresentation of a material fact)
- Fincher v. Robinson Bros. Lincoln-Mercury, Inc., 583 So. 2d 256 (Ala.) (advertising/puffery not actionable as fraud)
- Bellsouth Mobility, Inc. v. Cellulink, Inc., 814 So. 2d 203 (Ala.) (corporate commitment language can be puffery)
- LeFevre v. Westberry, 590 So. 2d 154 (Ala.) (insured must prove entitlement to recover before breach/bad-faith claims exist)
- Pontius v. State Farm Mut. Auto. Ins. Co., 915 So. 2d 557 (Ala.) (requirement to prove fault and extent of damages for UIM recovery)
- Ex parte Safeway Ins. Co. of Ala., Inc., 990 So. 2d 344 (Ala.) (ripeness/subject-matter jurisdiction for bad-faith/UIM claims)
- Hollowell v. Mail-Well Corp., 443 F.3d 832 (11th Cir.) (standard of review for summary judgment)
- Robinson v. Parrish, 720 F.2d 1548 (11th Cir.) (law-of-the-case does not bar reconsideration when court changes its view)