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Harness v. TWG Transportation Inc.

United States District Court, W.D. Oklahoma

July 5, 2018

PAUL D. HARNESS, Plaintiff,
v.
TWG TRANSPORTATION, INC.; KEVIN R. SAXTON; and CAROLINA CASUALTY INSURANCE COMPANY, Defendants.

          ORDER

          TIMOTHY D. DEGIUSTI UNITED STATES DISTRICT JUDGE

         Defendant Carolina Casualty Insurance Company (CCIC) moves to dismiss all claims made against it in Plaintiff Paul D. Harness's complaint for failure to state a claim upon which relief may be granted [Doc. No. 2]. Plaintiff has filed his response in opposition [Doc. No. 8] and CCIC has replied [Doc. No. 9]. The matter is fully briefed and at issue.

         Background

         This action stems from a motor vehicle accident which took place on March 7, 2016, in Oklahoma City, Oklahoma. Compl. [Doc. No. 2-4] ¶ 17. On that day, a truck-trailer operated by Defendant Kevin R. Saxton within the course of his employment with Defendant TWG Transportation, Inc. (TWG) collided with Plaintiff's vehicle. Id. ¶¶ 18, 23. Plaintiff alleges that Defendant Saxton negligently caused the accident and, by extension, Plaintiff's injuries resulting from the accident. Id. Additionally, Plaintiff states a claim against TWG for direct negligence, negligence per se, negligent entrustment, and negligent hiring, training, screening, and supervision of Defendant Saxton. Id. ¶¶ 27, 28. Finally, Plaintiff named CCIC a defendant due to its status as TWG's liability insurance carrier. Id. ¶ 40.

         Plaintiff alleges that under the Oklahoma Motor Carrier Act of 1995 (MCA), Okla. Stat. tit. 47, § 230.21 et seq., he may bring a direct action against CCIC for his injuries and damages. The MCA makes it unlawful for any motor carrier to operate or furnish service within Oklahoma without first having obtained a license from the Oklahoma Corporation Commission (OCC). Id. § 230.28. Additionally, prior to granting a license, a carrier must have an approved insurance policy or bond. Id. § 230.30. CCIC contends that since TWG never registered its insurance policy with the OCC, § 230.30 cannot be triggered here and CCIC cannot have an action brought directly against it.

         Standard of Decision

         Rule 8(a)(2) of the Federal Rules of Civil Procedure states that a pleading must contain a “short and plain statement of the claim showing that the pleader is entitled to relief.” Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009). The pleading must have sufficient factual matter that, when accepted as true, states “a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim to relief is plausible on its face when the plaintiff pleads facts that allow the court to reasonably infer that the defendant is liable for the alleged misconduct. Iqbal, 556 U.S. at 678. To survive a motion to dismiss, a pleading does not need detailed factual allegations, but must be more than a formulaic recitation of the elements of a cause of action or mere labels and conclusions. Twombly, 550 U.S. at 555. Courts must accept all well-pleaded allegations of the complaint, and must construe them in the light most favorable to the non-moving party. Thomas v. Kaven, 765 F.3d 1183, 1190 (10th Cir. 2014). Consideration of a Rule 12(b)(6) motion is limited to the complaint alone. Jacobsen v. Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002).

         Discussion

         As a general rule, in Oklahoma a plaintiff may not bring a direct action against a defendant's insurer. Daigle v. Hamilton, 782 P.2d 1379, 1381 (Okla. 1989). An exception to this rule is that an injured party may sue a motor carrier and its liability insurer when certain statutorily identified conditions are satisfied, or, as relevant here, “under a statute requiring the carrier to file a liability insurance policy or bond with the Oklahoma Corporation Commission.” Id. (citing Enders v. Longmire, 67 P.2d 12, 14 (Okla. 1937)). In Daigle, the Oklahoma Supreme Court established the rule that a plaintiff could maintain a joint, direct action against the carrier and the insurer by virtue of the carrier's obligation to maintain insurance under § 230.30. See Simpson v. Litt, No. CIV-17-339-R, 2017 WL 2271484, at *3 (W.D. Okla. May 23, 2017) (quoting Daigle, 782 P.2d at 1381).

         However, in Fierro v. Lincoln General Insurance Co., 217 P.3d 158 (Okla.Civ.App. 2009), the Oklahoma Court of Civil Appeals carved out an exception to this rule and found that the MCA does not permit a direct action against an interstate motor carrier's liability insurer when the insurer is properly registered in its home state. Id. at 160-61 (quoting Daigle, 782 P.2d at 1380). The court observed that the reasons for prohibiting a direct action against a defendant's insurer “besides statutory directive, include policy, prohibition by judicial decision, lack of privity between the injured plaintiff and the insurer, misjoinder of the tort action and the action on the contract, and the enforcement of the ‘no action' clause in the policy.” Id. (quoting Daigle, 782 P.2d at 1380). Post-Fierro, cases in the Western District of Oklahoma have held that insurance companies for interstate carriers who have not filed proof of insurance in Oklahoma may not be named as joint defendants. See, e.g., Hankla v. Lee, No. CIV-17-641-D, 2018 WL 563181 (W.D. Okla., Jan. 25, 2018); White v. Lewis, No. CIV-13-862-C, 2014 WL 7272464 (W.D. Okla., Dec. 18, 2014); Beebe v. Flores, No. CIV-11-1381-HE, 2012 WL 137780 (W.D. Okla., Jan. 28, 2012). A direct action against an insurer may be proper “if the Oklahoma Corporation Commission has issued [its insured] a motor carrier license.” See Simpson, 2017 WL 2271484, at *3.

         Here, Plaintiff makes the bare assertion that “pursuant to § 230.30 and Oklahoma law, CCIC is a properly named party and a direct and joined action can be maintained against said insurance company for the injuries and damages suffered by Plaintiff Harness.” Compl. ¶ 40. However, Plaintiff states no facts sufficient to make CCIC a defendant under § 230.30, namely that TWG registered its insurance with the OCC. This situation is identical to Hankla, where the plaintiffs merely pled that the motor carrier's liability insurer was a proper defendant solely due to the MCA. Hankla, 2018 WL 563181, at *2. This Court held in Hankla that, per Fierro, insurance companies for interstate carriers who have not filed proof of insurance with the OCC may not be named as joint defendants per the MCA. Id. Thus, here too CCIC may not be named a joint defendant because Plaintiff does not allege that TWG registered its insurance with the OCC.

         Plaintiff claims in his response that because Oklahoma participates in Unified Carrier Registration, a direct action may be brought against CCIC under § 230.30 if TWG is registered under Unified Carrier Registration.[1] Pl.'s Resp. Br. at 7. Plaintiff asserts that this allows a motor carrier to register annually with only one state and that such single-state registration satisfies the registration requirements in all participating states. Id. (citing Mid-Con Freight Sys., Inc., 545 U.S. at 443). Thus, Plaintiff contends, if TWG is so registered then it is effectively registered with the OCC and a direct action may be brought against CCIC under § 230.30. Id.

         The District Court for the Eastern District of Oklahoma, however, rejected this contention in Mason v. Dunn, No. CIV-14-282-KEW, 2016 WL 1178058 (E.D. Okla., Mar. 23, 2016). Mason held that out-of-state registration does not satisfy the requirement that the motor carrier's liability policy be filed with the OCC before the insurer may be subject to direct action. Id. at *2-3. See also Simpson, 2017 WL 2271484, at *3 (because interstate carriers do not need to register in Oklahoma and § 230.30 applies only to motor carriers required to obtain a license from the OCC, interstate carriers who have registered proof of insurance in their home state pursuant to Unified Carrier Registration are not subject to § 230.30). The Court agrees with the decisions in Mason and Simpson. Even if TWG is registered under Unified Carrier Registration, CCIC still may not be named as a defendant because TWG is not subject to § 230.30 and did not file its insurance policy with the OCC.

         Finally, Plaintiff claims in his response that failure to treat Unified Carrier Registration by TWG Transportation as registration with the OCC would “result in disparate treatment of Oklahoma citizens injured within the state of Oklahoma when compared to an Oklahoma registered motor carrier.” Pl.'s Resp. Br. at 7. This treatment, Plaintiff claims, is a violation of the Equal Protection Clause of the Fourteenth Amendment to the U.S. Constitution and Section 44 of Article IX of the Oklahoma Constitution, which requires domestic and foreign corporations to be treated the same in Oklahoma. Id. This is not accurate, ...


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