393 F.Supp.3d 404
E.D. Pa.2019Background
- Sally Perloff owned a life insurance policy on her husband Neil issued by Transamerica; Plaintiffs moved from Pennsylvania to Florida and updated Transamerica with their new address.
- On July 17, 2017 Transamerica mailed a lapse notice to Plaintiffs' son in Pennsylvania and to Plaintiffs' Florida address; Plaintiffs allege the son had not previously known of the policy and that disclosure risked family conflict.
- Plaintiffs sued in state court; Transamerica removed to federal court on diversity grounds and moved to dismiss under Fed. R. Civ. P. 12(b)(6).
- Claims: Sally asserted breach of contract (based on a Privacy Statement incorporated into the policy), breach of fiduciary duty, invasion of privacy, and negligent infliction of emotional distress (NIED); Neil asserted loss of consortium and NIED.
- Court accepted Plaintiffs’ factual allegations for the motion-to-dismiss analysis and evaluated whether each claim stated a plausible claim for relief under governing Pennsylvania law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Breach of contract (privacy statement) | Sally: Privacy Statement was part of the policy and promised confidentiality; Transamerica breached it by mailing lapse notice to son. | Transamerica: Privacy Statement is a nonbinding, general corporate statement not incorporated into the contract and contains no specific promise breached. | Denied dismissal: Sally sufficiently alleged the Privacy Statement was part of the contract and that Transamerica breached contractual privacy obligations; claim may proceed. |
| Public disclosure of private facts (invasion of privacy) | Plaintiffs: Disclosure to son (and risk he would tell siblings) constitutes publicity of private facts. | Transamerica: Disclosure to one person is not publicity; speculation about future dissemination is insufficient. | Dismissed with prejudice: Pennsylvania requires publicity to many people or substantial certainty of public knowledge; disclosure to one person fails. |
| NIED based on special relationship | Plaintiffs: Breach of insurer duties to maintain privacy foreseeably causes extreme emotional harm; special-relationship NIED should apply. | Transamerica: No special relationship that places emotional wellbeing in insurer's hands; traditional NIED categories inapplicable. | Dismissed with prejudice: Even if special-relationship NIED exists, insurer–insured relationship does not encompass assumed duty over emotional wellbeing. |
| Breach of fiduciary duty | Sally: Transamerica’s privacy promises created a confidential/fiduciary relationship obligating protection of private information. | Transamerica: No unique degree of trust giving rise to fiduciary duty; promises of privacy do not create fiduciary status. | Dismissed with prejudice: No facts show a fiduciary or confidential relationship (no undue influence or ceded control); privacy promises alone insufficient. |
| Loss of consortium (Neil) | Neil: Derivative claim based on harms to wife from torts and contract breach. | Transamerica: Derivative tort claims fail with underlying tort dismissals; Neil is not a party to the contract so cannot claim consortium from contract breach. | Dismissed: Underlying tort claims dismissed; Neil not party to contract, so consortium claim fails. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard for pleadings)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must raise reasonable expectation discovery will reveal necessary elements)
- Toney v. Chester County Hosp., 36 A.3d 83 (Pa. 2011) (special-relationship NIED discussion)
- Burger v. Blair Med. Assocs., Inc., 964 A.2d 374 (Pa. 2009) (Pennsylvania rejects "special relationship" publicity exception for public-disclosure tort)
- Vogel v. W. T. Grant Co., 327 A.2d 133 (Pa. 1974) (disclosure to one person does not satisfy publicity element)
- Harris by Harris v. Easton Publishing Co., 483 A.2d 1377 (Pa. Super. 1984) (adopting Restatement §652D publicity elements)
- Yenchi v. Ameriprise Financial, Inc., 161 A.3d 811 (Pa. 2017) (analysis of when fiduciary duties exist)