United States District Court, D. South Carolina, Charleston Division
ORDER AND OPINION
Richard Mark Gergel United States District Court Judge.
matter is before the Court on the Motion to Dismiss filed by
Defendant United Specialty Insurance Company
("United"). (Dkt. No. 84.) FCCI Insurance Company
("FCCI") has filed a Response in Opposition to the
Motion to Dismiss (Dkt. No. 101), and United has filed a
Reply (Dkt. No. lo8). For the reasons set forth below,
United's Motion to Dismiss (Dkt. No. 84) is granted.
Background and Relevant Facts
a declaratory judgment action arising out of the construction
of Palmetto Pointe at Peas Island, a condominium complex in
Charleston, South Carolina (the "Peas Island
Project"). Complete Building Corporation
("Complete") was the general contractor for the
Peas Island Project. The Palmetto Pointe at Peas Island
Condominium Property Owners Association, Inc. (the "Peas
Island POA") filed the underlying complaint against
Complete and a number of subcontractors alleging latent
construction defects that caused water intrusion and other
damages (the "Underlying Action").
issued multiple commercial general liability and umbrella
insurance policies to Complete from February 18, 2014 through
February 18, 2016. (Dkt. No. 13 at 13, Am. Compl.
¶¶ 61-64.) Prior to the FCCI policies, United
issued two commercial general liability insurance policies to
Complete. (Id. at 12, ¶¶ 58-59.) FCCI is
defending Complete in the Underlying Action. United denied
coverage to Complete in the Underlying Action pursuant to a
policy endorsement it alleges excludes coverage for property
damage arising out of work on a condominium project exceeding
25 units. (Dkt. No. 84-2 at 66; Dkt. No. 84-3 at 68.)
Amended Complaint (Dkt. No. 13), FCCI seeks declaratory
relief against various Defendants on three separate Counts.
Counts I and II do not pertain to United as they seek
declarations concerning the rights and obligations of
insurers that issued policies to Complete's
subcontractors (Count I) and concerning FCCI's rights and
obligations under its own policies to Complete (Count II).
The Court has issued an Order (Dkt. No. 130) granting six
Defendants' Motions to Dismiss claims against them under
Counts I and II.
Count III addresses insurers such as United that also issued
insurance policies directly to Complete. FCCI seeks a
declaration that these other insurers, including United, owe
a duty to defend and indemnify their mutual insured,
Complete. FCCI also asks the Court to make a determination on
the apportionment of the time on risk as between FCCI and
these other insurers. (Dkt. No. 13 at 30, Am. Compl. ¶
155.) United has moved to dismiss all of FCCI's claims
against it pursuant to Rules 12(b)(1) and 12(b)(6) of the
Federal Rules of Civil Procedure.
Rules 12(b)(1) and 12(b)(6)
motion to dismiss for lack of subject matter jurisdiction
filed pursuant to Rule 12(b)(1) of the Federal Rules of Civil
Procedure raises the fundamental question of whether a court
has jurisdiction to adjudicate the matter before it.
Arbaugh v. Y & H Corp., 546 U.S. 500, 514
(2006). It is the plaintiffs burden to prove jurisdiction,
and the court is to "regard the pleadings'
allegations as mere evidence on the issue, and may consider
evidence outside the pleadings without converting the
proceeding to one for summary judgment." Richmond,
Fredericksburg & Potomac R. Co. v. United States,
945 F.2d 765, 768 (4th Cir.1991).
motion to dismiss for lack of subject matter jurisdiction can
arise in two contexts: (1) when the moving party maintains
that the complaint "fails to allege facts upon which
subject matter jurisdiction can be based" or (2) when
the moving party asserts that the "jurisdictional
allegations of the complaint [are] not true" Adams
v. Bain, 697 F.2d 1213, 1219 (4th Cir.1982). In the
first situation, where the moving party asserts that the
non-moving party has failed to allege facts establishing
subject matter jurisdiction, the court must assume all the
facts alleged in the complaint to be true. Id. In
the second situation, where the moving party disputes the
validity of the jurisdictional allegations in the complaint,
the court may look beyond the complaint and consider other
evidence, such as affidavits, depositions, and live
testimony. Id. The burden of proof in that situation
falls on the plaintiff to demonstrate subject matter
12(b)(6) of the Federal Rules of Civil Procedure permits the
dismissal of an action if the complaint fails "to state
a claim upon which relief can be granted." Such a motion
tests the legal sufficiency of the complaint and "does
not resolve contests surrounding the facts, the merits of the
claim, or the applicability of defenses. . . . Our inquiry
then is limited to whether the allegations constitute 'a
short and plain statement of the claim showing that the
pleader is entitled to relief.'" Republican
Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir.
1992) (quotation marks and citation omitted). When
considering a motion to dismiss under Rule 12(b)(6), the
Court is obligated to "assume the truth of all facts
alleged in the complaint and the existence of any fact that
can be proved, consistent with the complaint's
allegations." E. Shore Mkts., Inc. v. J.D. Assocs.
Ltd. P'ship, 213 F.3d 175, 180 (4th Cir. 2000).
While the Court must accept the facts in a light most
favorable to the non-moving party, it "need not accept
as true unwarranted inferences, unreasonable conclusions, or
survive a motion to dismiss, the complaint must state
"enough facts to state a claim to relief that is
plausible on its face." Bell Atl Corp. v.
Twombly, 550 U.S. 544, 570 (2007). Although the
requirement of plausibility does not impose a probability
requirement at this stage, the complaint must show more than
a "sheer possibility that a defendant has acted
unlawfully." Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). A complaint has "facial plausibility"
where the pleading "allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged." Id.