United States District Court, N.D. Texas, Dallas Division
MEMORANDUM OPINION AND ORDER DENYING MOTION TO
DISMISS OR TRANSFER
BARBARA M. G. LYNN CHIEF JUDGE.
the Court is Defendant Matthew Kunkle's Motion to Dismiss
or Transfer. (ECF No. 21). For the reasons stated below, the
Motion is DENIED.
Factual and Procedural Background
Founders Insurance Company is an insurance company whose
citizenship, place of incorporation, and principal place of
business are all outside Texas. (ECF No. 1 ¶ 3).
Defendant Billy's Bar & Grill, LLC
(“BB&G”) was a limited liability company
formed under the laws of Texas, before it forfeited its
charter on February 21, 2014. (Id. ¶ 4, Ex. B).
Plaintiff was the former insurer of BB&G until the policy
was allegedly cancelled on September 5, 2011. (Id.
¶¶ 1, 12). This insurance coverage dispute stems
from a September 30, 2011, incident in which an intoxicated
Kunkle was allegedly injured when he crashed his motorcycle
after drinking at BB&G. (Id. ¶ 16).
Joe Polanco is an individual who resides, is a citizen of,
and formerly conducted business in Texas. (Id.
¶ 5). Defendant Matthew Kunkle is an individual who
resides in and is a citizen of Texas. (Id. ¶
7). Laurie Kinser is an individual who was terminated as a
Defendant on May 29, 2018, when the Court granted Plaintiff
and Kinser's Joint Motion to Dismiss with Prejudice.
(See ECF Nos. 13-14).
February 14, 2018, Plaintiff filed its Complaint and Request
for Declaratory Judgment under Federal Rule of Civil
Procedure 57 and 28 U.S.C. §§ 2201 and 2202.
(See ECF No. 1). Plaintiff requests a declaratory
judgment that the Liquor Liability Policy No. LLTX000892 (the
“Founders Policy”), which lists BB&G as the
named insured, was cancelled effective September 5, 2011.
(Id. ¶¶ 1, 12). Kinser is listed as an
additional insured party on the Founders Policy.
(Id., Ex. A at 4, 6-7). Plaintiff also seeks a
declaratory judgment that it had and has no duty to defend or
indemnify any Defendant for claims in a related Collin County
suit by Kunkle, arising from injuries Kunkle allegedly
incurred in the September 30, 2011, motorcycle crash.
(Id. ¶ 2). On September 3, 2013, Kunkle filed
suit in Collin County, Texas, against BB&G, Polanco,
Kinser, and others not named as defendants in this case (the
“Collin County suit”). (Id. ¶ 16,
Ex. C at 6; see also Matthew Kunkle v. Billy's Bar
& Grill, LLC, et al., No. 219-03508-2013 (219th
Dist. Ct., Collin County, Tex. Sept. 3, 2013). That suit is
still pending. (Id.)
alleges the following facts. On October 1, 2013, Plaintiff
received a fax from one of Kunkle's attorneys, with a
copy of Kunkle's petition in the Collin County suit. (ECF
No. 1 ¶ 19). In an October 3, 2013, telephone
conversation with that attorney, Plaintiff told him that the
Founders Policy did not cover the motorcycle crash, and that
Plaintiff had provided the relevant policy documents to
Kunkle's prior counsel, including the notice of policy
cancellation. (Id. ¶ 20).
February 21, 2014, BB&G forfeited its charter to the
Texas Secretary of State. (Id. ¶ 4, Ex. B).
August 21, 2017, Kinser's attorney sent Plaintiff, in a
fax and email, a second notice of Kinser's claim under
the Founders Policy, seeking a defense and indemnity on
Kunkle's claims against her in the Collin County suit.
(Id. ¶ 26, Ex. C). Kinser alleged that she was
an additional insured under the Founders Policy, and attached
a copy of Kunkle's petition in the Collin County suit.
(Id.) The documents Kinser submitted to Plaintiff
therefore showed that the motorcycle crash was outside the
coverage period. (Id.)
September 7, 2017, Plaintiff notified Kinser that it declined
her claim for a defense and indemnity, because the Founders
Policy was not in effect on September 30, 2011, the date of
the incident resulting in Kunkle's injuries.
(Id. ¶ 27). Plaintiff requested that Kinser
provide the information she relied upon in making the August
21, 2017, claim, but received no response. (Id.)
is not an insured or named beneficiary in the Founders
Policy. (Id. ¶ 28, Ex. A). Kunkle moves to
dismiss Plaintiffs claims under Federal Rules of Civil
Procedure 12(b)(6) and 12(b)(3), or, in the alternative, to
transfer this case to the Eastern District of Texas under 28
U.S.C. § 1404(a) or 1406(a). (ECF No. 21).
Motion to Dismiss Under Fed.R.Civ.P. 12(b)(6)
ruling on a motion to dismiss pursuant to Federal Rule of
Civil Procedure 12(b)(6), the Court must take the allegations
of the complaint as true, resolving ambiguities or doubts
regarding sufficiency of the claim in favor of the plaintiff.
Fernandez-Montes v. Allied Pilots Ass'n, 987
F.2d 278, 284 (5th Cir. 1993). A pleading must
contain “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). This pleading standard does not require
“detailed factual allegations, ” but it does
demand more than an unadorned accusation devoid of factual
support. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555 (2007)). To survive a motion to dismiss, a complaint must
contain sufficient facts to state a claim for relief that is
plausible on its face. Twombly, 550 U.S. at 570. A
court must accept all factual allegations as true, but it is
not bound to accept as true “a legal conclusion couched
as a factual allegation.” Id. at 555. When the
facts do not permit the court to infer more than the mere
possibility of misconduct, the complaint has stopped short of
showing that the pleader is plausibly entitled to relief.
Iqbal, 556 U.S. at 678.
courts may only consider the pleadings, and their
attachments, when deciding a Rule 12(b)(6) motion.
Collins v. Morgan Stanley Dean Witter, 224 F.3d 496,
498 (5th Cir. 2000). A court may also consider and take
judicial notice of matters of public record, including
filings establishing litigation in another court. See
Lovelace v. Software Spectrum, Inc., 78 F.3d 1015,
1017-18 (5th Cir. 1996); see also Fed. R. Evid.
201(f); Norris v. Hearst Trust, 500 F.3d 454, 461
n.9 (5th Cir. 2007); SB Int'l, Inc. v. Jindal,
No. 3:06-CV-1174-G, 2007 WL 1411042, at *1 (N.D. Tex. May 14,
2007). Thus, this Court may consider the Founders Policy and
Defendant Kunkle's petition in the Collin County suit,
both of which Plaintiff attached to its Complaint. (ECF No.
1, Ex. A, C at 6-15).
the Erie doctrine, “federal courts sitting in
diversity apply state substantive law and federal procedural
law.” Nat'l Liab. & Fire Ins. Co. v. R
& R Marine, Inc., 756 F.3d 825, 834 (5th Cir. 2014).
Because the issue of standing affects the parties'
substantive rights, Texas law governs. See id.