Procedural Posture

Plaintiffs, insured husband and wife, sued defendants, insurance companies, alleging breach of written contract, breach of the covenant of good faith and fair dealing, and injunctive relief and restitution pursuant to Cal. Bus. & Prof. Code § 17200. The insurance companies moved for partial summary judgment as to the breach of contract claim.

Overview

The policy holders were informed by their homeowners’ association that their pool encroached on the association’s common area and they were required to remove it or the association would sue. The policy holders informed the insurance companies of the possible litigation and the insurance companies opened a claim file. The policy holders filed a quiet title action against the association who filed a cross-complaint. The policy holders sent the insurance companies a copy of their complaint and the cross-complaint over two months after both were filed. The insurance companies informed the policy holders that they would only cover the cross-complaint. The policy holders filed the instant action. The court found that the policy holders failed to show that the insurance contract required the insurance companies to pay interest on attorney fees incurred by the policy holders. Thus, the failure to pay interest on the fees could not establish a genuine issue of material fact with respect to the breach of contract claim. The policy holders failed to show that the contract provided for reimbursement of the cost of notifying defendants of a potential claim. Appellant was represented by a business attorney.

Outcome

The insurance companies’ motion for partial summary judgment was granted.

Procedural Posture

Defendants moved to dismiss plaintiff’s complaint asserting state law claims of fraud, conspiracy, interference with contractual relations, violation of Cal. Bus. & Prof. Code § 17200, and a sole federal claim charging a violation of the Robinson-Patman Act, 15 U.S.C.S. § 13(f).

Overview

In plaintiff’s antitrust action, the court found that defendant buyers’ liability under the Robinson-Patman Act, 15 U.S.C.S. § 13(f), was dependent on a seller’s liability under 15 U.S.C.S. § 13(a). Plaintiff’s contention that it was immune from liability, but that defendant buyers were subject to liability for the sale in question, was therefore untenable. The very fact that liability was premised on the commission of a fraud demonstrated the unlikelihood of any mutual continuation of sales between the parties, and hence, of any enduring anti-competitive effects. The court held that to permit a Robinson-Patman Act claim under these circumstances would effectively displace appropriate and exacting state common law counts for fraud, misrepresentation, or concealment, with an overbroad federal response, unwarranted by circumstance.

Outcome

Plaintiff’s federal claim was found to be improperly before the court and was therefore dismissed without leave to amend, as defendants’ liability was dependent on plaintiff’s liability under the Robinson-Pateman Act, and the remaining state law claims were dismissed without prejudice, for their renewal in a state court action.