Rosario v. Liberty Mut. Personal Ins. Co. (Feb. 13, 2026)

Case details
Full caption
Nydia Rosario v. Liberty Mutual Personal Insurance Company
Country
United States
Jurisdiction
Federal
Decided
Feb. 13, 2026
Disposition
Dismissed
Majority
Memorandum Kearney (J.) (unanimous Court)
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.12026 WL 413438Only the Westlaw citation is currently available.United States District Court, E.D. Pennsylvania.NYDIA ROSARIOv.LIBERTY MUTUAL PERSONALINSURANCE COMPANYCIVIL ACTION NO. 26-276|Filed 02/13/2026Attorneys and Law FirmsNydia Rosario, Philadelphia, PA, Pro Se.Robert E. Smith, Marshall, Dennehey, Warner, Coleman& Goggin, Philadelphia, PA, for Liberty Mutual PersonalInsurance Company.MEMORANDUMKEARNEY, J.*1 An injured person suing her car insurer for not payingher benefits under her insurance policy may believe herinsurer is also acting in bad faith in resolving her insuranceclaim. But a breach of contract is not bad faith. The injuredperson must plead more than conclusions of bad faith. Theinjured person must plead specific facts known to her orawait discovery and amend if warranted. We today dismissan injured person's statutory bad faith claim against herinsurer and strike three conclusory allegations relating onlyto her pleaded (but now dismissed) statutory bad faith. Wedismiss the claim and allegations without prejudice to amendher complaint after adducing discovery affording her anability to plead facts beyond legal conclusions and to pleadan alternative contract theory of bad faith outside of thePennsylvania statute if warranted by the facts. We also notethe insurer's counsel's inaccuracies in briefing with a warningand notice requirement expecting we will not see these errorsagain from counsel or his law firm.I. Alleged FactsPhiladelphian Nydia Rosario purchased an insurance policyfrom Liberty Mutual Personal Insurance Company providingup to fifty thousand dollars in underinsured motoristinsurance coverage. for her should she be in a car accidentin January 2024.1 Ms. Rosario drove her insured caron January 12, 2024 when non-party Edith Brown droveinto Ms. Rosario's car.2 Ms. Rosario suffered severe andpermanent bodily injury.3 Ms. Brown's insurance policyprovided her with a total of fifteen thousand dollars incoverage.4 Ms. Rosario settled her claim against Ms. Brownfor fifteen thousand dollars.5 Liberty Mutual consented to thesettlement with Ms. Brown.6Ms. Rosario forwarded a complete packet of her medicalinformation to Liberty Mutual seeking underinsured motoristbenefits up to her policy limit of fifty thousand dollars.7Ms. Rosario did not plead when she sent this informationto Liberty Mutual. Her insurer to date has not settled Ms.Rosario's underinsured motorist claim.8II. AnalysisMs. Rosario sued her insurer Liberty Mutual for breach ofcontract in not paying her the underinsured motorist benefitsup to the policy limits.9Ms. Rosario also claims Liberty Mutual violated aPennsylvania statute by acting in bad faith in not makingan offer or paying underinsured motorist benefits.10 Sheconcludes Liberty Mutual refused to fairly evaluate herclaim or make a good faith settlement offer.11 Shefurther alleges someone from Liberty Mutual misrepresentedundisclosed facts to her regarding the insurer's evaluationof the claim.12 She alleges Liberty Mutual engaged inoutrageous, intentional, reckless, malicious, or negligentacts in not making an offer or not making payments andundisclosed representations by Preston Kidd and Dustin Doddat undisclosed times.13*2 Liberty Mutual moves to dismiss Ms. Rosario's bad faithclaim and to strike three conclusory fact allegations possiblyrelating to her bad faith claim.14 Ms. Rosario counters shealleges sufficient facts to support her bad faith claim andher three challenged allegations are relevant to the breach ofcontract claim.15 We agree with Liberty Mutual and dismissthe statutory bad faith claim.16
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.2A. We dismiss the conclusory statutorybad faith claim without prejudice.*3 Ms. Rosario alleges Liberty Mutual acted in badfaith under a specific Pennsylvania statute.17 LibertyMutual moves to dismiss Ms. Rosario's statutory bad faithclaim for not pleading facts beyond conclusory generalallegations without specificity. Liberty Mutual argues Ms.Rosario points to “misrepresentations” without identifyingthe misrepresentations.18 Liberty Mutual further describesthe settlement offer Ms. Rosario rejected before filing suitfiled.19 Ms. Rosario now confirms the offer and she rejectedthe offer.20 Ms. Rosario counters her limited allegations aresufficient to support her statutory bad faith claim.21 We agreewith Liberty Mutual.The Pennsylvania General Assembly did not define “badfaith.”22 But the Pennsylvania Supreme Court defines badfaith as “frivolous or unfounded refusal to pay proceedsof a policy[.]”23 To prevail on a statutory bad faithclaim, Ms. Rosario must show by clear and convincingevidence: (1) Liberty Mutual “had no reasonable basis”for denying policy benefits, and (2) Liberty Mutual “knewor recklessly disregarded its lack of reasonable basis indenying the claim.”24 Bad faith is not limited only tothe denial of coverage; it “may also include a lack ofinvestigation, unnecessary or unfounded investigation, failureto communicate with the insured, [ ] failure to promptlyacknowledge or act on claims,” “poor claims-handling,”“failure to act with diligence or respond to the insured,scattershot investigation, and similar conduct.”25Ms. Rosario must plead specific facts to allege bad faithunder the Pennsylvania General Assembly's bad faith statuteand cannot rely on conclusory statements and “bare-bonesallegations.”26 Ms. Rosario must allege the “who, what,where, when, and how the alleged bad faith conductoccurred.”27Ms. Rosario alleges Liberty Mutual agent or employeePreston Kidd engaged in “outrageous, intentional,reckless, malicious and/or negligent” conduct by “makingmisrepresentations,” “failing to make any offer,” or “failingto make any payments.”28 Ms. Rosario further pleadsLiberty Mutual agent or employee Dustin Dodd “mademisrepresentations concerning the underinsured motoristclaims.”29 Ms. Rosario's allegations allow us to reasonablyinfer who committed the alleged wrongs: Preston Kidd andDustin Dodd. Ms. Rosario does not plead what, where, when,or how Preston Kidd and Dustin Dodd acted in bad faith. Wecannot plausibly infer Liberty Mutual acted in statutory badfaith based on the pleaded facts.Ms. Rosario also alleges Liberty Mutual refused tofairly evaluate her underinsured motorist claim and mademisrepresentations regarding its evaluation of her claim.30Ms. Rosario further alleges Liberty Mutual has not justified“its failure to make any offer” or “payments” to her underthe provisions of the policy.31 These are conclusions, notfacts. Ms. Rosario must do more than allege Liberty Mutualacted unfairly; she must describe with specificity how LibertyMutual lacked a reasonable basis for denying her benefitsand knew or recklessly disregarded the lack of a reasonablebasis.32 Ms. Rosario must also allege facts beyond theamount of Liberty Mutual's settlement offer to state a claimfor statutory bad faith.33*4 We dismiss Ms. Rosario's statutory bad faith claimwithout prejudice.B. We strike the conclusory allegations at paragraphs15-17 of the Complaint without prejudice as entirelyrelated to the dismissed statutory bad faith claim.Liberty Mutual moves to strike Ms. Rosario's allegations atparagraphs 15, 16, and 17, which offer conclusory allegationsLiberty Mutual refused to fairly evaluate the underinsuredmotorist claim, did not make a good faith settlement offer,and made misrepresentations which have no basis in thepleaded breach of contract claim.34 Ms. Rosario counters itwould be unfair to strike her claim at this early stage becausethese allegations are relevant to Liberty Mutual's contractualduties.35 She may be right as a matter of contract law if shepleaded a breach of contract under an implied oovenant ofgood faith. But Ms. Rosario did not plead Liberty Mutualbreached their insurance contract by this conduct. She allegesfailure to pay her benefits is the breach of contract. We agreewith Liberty Mutual based on the present pleaded breach ofcontract claim We strike paragraphs 15, 16, and 17 from Ms.Rosario's Complaint without prejudice.
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.3We “may strike from a pleading an insufficient defense or anyredundant, immaterial, impertinent, or scandalous matter.”36We disfavor motions to strike.37 The standard is “strict” andwe only strike allegations from Ms. Rosario's claims whichare so unrelated to her remaining claims as to be “unworthyof any consideration.”38 Labeling an allegation “immaterial”means finding it has “no essential or important relationship tothe claim for relief.”39Ms. Rosario's only remaining claim is her breach of contractclaim because Liberty Mutual did not pay her claim. She doesnot allege breach of contract through breach of an impliedcovenant of good faith and fair dealing. A breach of contractclaim under Pennsylvania law requires Ms. Rosario to show:“(1) the existence of a contract, including its essential terms,(2) a breach of the contract; and (3) resultant damages.”40A breach of the contract is “the nonperformance of a dutyimposed by a contract between parties.”41*5 Ms. Rosario's allegations in paragraphs 15, 16, and 17are immaterial to her breach of contract claim for two reasons.First, Ms. Rosario does not allege facts in paragraphs 15, 16,or 17 to support an element of a breach of contract claim.Second, Ms. Rosario has not argued how the allegationsin paragraphs 15, 16, or 17 are relevant to her contractclaim beyond a conclusory statement they are relevant.42Ms. Rosario does not allege facts establishing the existenceof her contract with Liberty Mutual nor its essential termsin paragraphs 15, 16, or 17. Nor does she allege thenonperformance of a specific contractual duty by LibertyMutual in paragraphs 15, 16, or 17. Ms. Rosario also does notallege resultant damages in these paragraphs.We find paragraphs 15, 16, and 17 are unrelated andimmaterial to the elements of Ms. Rosario's breach of contractclaim. We strike paragraphs 15, 16, and 17 without prejudice.III. ConclusionMs. Rosario does not plead facts allowing us to plausiblyinfer an insurer's bad faith claim under Pennsylvania law. Wedismiss her bad faith claim without prejudice to amend shouldMs. Rosario discover facts allowing her to proceed on her badfaith claim consistent with Rule 11. We strike Ms. Rosario'sconclusory allegations at paragraphs 15, 16, and 17 as entirelyunrelated to her breach of contract claim without prejudice.All CitationsSlip Copy, 2026 WL 413438Footnotes1ECF 1-5 ¶¶ 1, 3, 10–12.2Id. ¶¶ 3–4. Ms. Rosario pleaded she drove the car and did not drive the car. Id. ¶¶ 3, 5, 10. It cannot be both.3Id. 6.4Id. 7.5Id. 8.6Id. 9.7Id. 14.8Id. 24.9Id. ¶¶ 18–24.10Id. ¶¶ 25–33.
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.411Id. ¶¶ 15–16.12Id. 17.13Id. ¶¶ 27, 31. Ms. Rosario also now concedes her insurer offered her a settlement. ECF 15 14.Ms. Rosario further claimed Liberty Mutual violated Pennsylvania's Unfair Trade Practices and ConsumerProtection Law. ECF 1-5 ¶¶ 34–39 (citing 73 Pa. C.S.A § 201-1 et seq.). Ms. Rosario and Liberty Mutualstipulated to the voluntarily dismissal of Ms. Rosario's unfair trade practices claim. ECF 13. We dismissedher unfair trade practices claim without prejudice. ECF 14.14ECF 12. Liberty Mutual moves to dismiss for failure to state a claim under Federal Rule of Civil ProcedureRule 12(b)(6).A complaint must state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). The purpose ofRule 12(b)(6) is to test the sufficiency of a complaint under the plausibility pleading standard. Zanetich v. Wal-Mart Stores East, Inc., 123 F.4th 128, 138 (3d Cir. 2024). A plaintiff must include “sufficient factual matter,accepted as true, ‘to state a claim to relief that is plausible on its face.’ ” Huertas v. Bayer US LLC, 120 F.4th1169, 1174 (3d Cir. 2024) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). A claim is facially plausible“when the plaintiff pleads factual content that allows the court to draw the reasonable inference that thedefendant is liable for the misconduct alleged.” Kalu v. Spaulding, 113 F.4th 311, 325 (3d Cir. 2024) (quotingIqbal, 556 U.S. at 678). “ ‘Plausibly’ does not mean ‘probably,’ but ‘it asks for more than a sheer possibility thata defendant has acted unlawfully.’ ” Smith & Wesson Brands, Inc. v. Estados Unidos Mexicanos, 605 U.S.280, 291 (2025) (quoting Iqbal, 556 U.S. at 678). A pleading offering “labels and conclusions,” “a formulaicrecitation of the elements of a cause of action,” or “tenders ‘naked assertion[s]’ devoid of ‘further factualenhancement’ ” is insufficient. Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555,557 (2007)).Our Court of Appeals requires us to apply a three-step analysis to a 12(b)(6) motion: (1) we “tak[e] note ofthe elements a plaintiff must plead to state a claim”; (2) we “identify allegations that ...‘are not entitled to theassumption of truth’ because those allegations ‘are no more than conclusion[s]’ ”; and, (3) “ ‘[w]hen thereare well-pleaded factual allegations,’ we ‘assume their veracity’ ... in addition to assuming the veracity of‘all reasonable inferences that can be drawn from’ those allegations ... and, construing the allegations andreasonable inferences ‘in the light most favorable to the [plaintiff]’..., we determine whether they ‘plausiblygive rise to an entitlement to relief.’ ” Oakwood Lab'ys LLC v. Thanoo, 999 F.3d 892, 904 (3d Cir. 2021)(internal citations omitted).15ECF 15-1 at 5–8.16Trial counsel and judges increasingly work under a risk of miscitations or unsupported arguments patchedfrom artificial intelligence favored by many lawyers. We have no reason to today find the abuse of artificialintelligence research. We instead see old-fashioned lack of diligence.Counsel is professionally obligated (compounded by risk to their and their law firm's reputations) to bediligent in ensuring the accuracy of citations and quotations in briefing submitted to us and our colleagues.Experienced federal lawyers know our talented lawyers in Chambers study their work product to advise thejudges. And these Chambers's lawyers are unfairly burdened in a busy urban federal court docket. We relyon counsel to present accurate citations.
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.5Liberty Mutual's legal citations contain incorrect reporter volume numbers, incorrect pincites, and misquotedlanguage in the Brief in support of its renewed Motion to dismiss Count II. See ECF 12-1. By way of limitedexample, counsel:• Quotes Kiessling v. State Farm Mut. Auto. Ins. Co., No. 18-4281, 2019 WL 634639 (E.D. Pa. Feb.14, 2019) for the proposition conclusory allegations “must be disregarded for purposes of resolvinga 12(b)(6) motion to dismiss.” See ECF 12-1 at 4. But Judge Slomsky in Kiessling quotes our Courtof Appeals's Rule 12(b)(6) framework from Santiago v. Warminster Twp. and this language does notexist in Santiago. 629 F.3d at 130.• States the incorrect reporter volume when citing Smith v. State Farm Auto. Ins. Co., 506 F. App'x 133(3d Cir. 2012). Counsel wrote 56 instead of 506. See ECF 12-1 at 7. The cite at 56 F. App'x 133 isto United States v. Lutz, a three-paragraph opinion from the Court of Appeals for the Fourth Circuitdismissing an appeal for lack of jurisdiction.• Provides an incorrect pincite when citing “Jones v. Allstate Ins. Co., 2017 U.S. Dist. LEXIS 93673, at*2-3 (E.D. Pa. 2017)” as “Id. [sic] at *2-3.” See ECF 12-1 at 8. It appears counsel relies on the Lexisunreported case identifier but the Westlaw pincite locator. The quoted language appears at *5 in 2017U.S. Dist. LEXIS 93673 (E.D. Pa. June 19, 2017) and at *2-3 in 2017 WL 2633472 (E.D. Pa. June19, 2017).• Repeatedly omitting required pincites, failing to provide complete electronic report numbers,misidentifying case captions, and reproducing verbatim language without quotation marks. See ECF12-1 at 10–12 (citing “Zaloga v. Provident Life & Accident Ins. Co. of Am., 671 F. Supp. 2d 623 (M.D.Pa. 2009)” twice without a pincite and quoting the opinion's language without quotation marks; citing“Hoffer v. Grane Ins. Co., 2014 U.S. Dist. LEXIS (M.D. Pa. 2014)” without including the completeelectronic report number or pincite and again reproducing language from the opinion without quotationmarks; quoting “Stepanovich v. State Farm, No. 1239 WDA 2012, 1296 WDA 2012 (Pa. Super. Oct. 15,2013)” without providing a reporter citation, an electronic database citation, or a pincite to the quotedlanguage and misidentifying the case caption; citing “Schwendinger-Roy v. State Farm Mut. Auto. Ins.Co., No. 11-CIV-445 (W.D. Pa. July 10, 2012)” without providing an electronic report number; quotingWagner v. State Farm Mut. Auto. Ins. Co., 2014 U.S. Dist. LEXIS 194554 (E.D. Pa. Feb. 20, 2014)without providing a pin cite).More concerning is Liberty Mutual's counsel may have copy-and-pasted many of these miscitations andinaccurate quotations from memoranda he filed supporting motions to dismiss before our colleagues. See,e.g, Tsirikis-Brown v. Liberty Mut. Ins., No. 25-5165 (E.D. Pa. Sept. 15, 2025), ECF 12-1; Blazejewski v.Liberty Mut. Ins. Co., No. 25-990 (E.D. Pa. Apr. 10, 2025), ECF 12; Giraldo v. Liberty Mut. Gen. Ins. Co.,No. 24-5286 (E.D. Pa. Oct. 9, 2024), ECF 3.We defer entering a monetary or educational sanction today. But we direct Liberty Mutual's counsel to sharethis Memorandum with his law firm colleagues so they can be on notice should we see a repeat of theseerrors in future briefing including errors copied from those earlier presented to our colleagues. Law firmsof considerable renown work hard to ensure their reputations for candor and professionalism. We hope toensure Liberty Mutual's counsel can honor the hard work of his colleagues by sharing these lessons amongall first-year litigation associates and all colleagues representing clients facing bad faith insurer claims andby confirming he advised his colleagues.17ECF 1-5 26 (citing 42 Pa. C.S.A. § 8371 (1990)).18ECF 12-1 at 6.
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.619Id. at n.2; ECF 12 14.20ECF 15 14.21ECF 15-1 at 5–7.22Wolfe v. Allstate Prop. & Cas. Ins. Co., 790 F.3d 487, 498 (3d Cir. 2015).23Borden v. NGM Ins. Co., 660 F. Supp. 3d 322, 329 (E.D. Pa. 2023) (citing Rancosky v. Wash. Nat'l Ins. Co.,170 A.3d 364, 373 (Pa. 2017)), appeal dismissed, Borden v. 6 Ins. Co., No. 23-1622, 2023 WL 6446209(3d Cir. July 13, 2023)).24Berg v. Nationwide Mut. Ins. Co., Inc., 235 A.3d 1223, 1232 (Pa. 2020) (quoting Rancosky, 170 A.3d at 377).25Peltz v. State Farm Mut. Auto. Ins. Co., 538 F. Supp. 3d 498, 509 (W.D. Pa. 2021) (quoting Ironshore SpecialtyIns. Co. v. Conemaugh Health Sys., Inc., 423 F. Supp. 3d 139, 154–55 (W.D. Pa. 2019), reconsiderationdenied, No. 18-153, 2020 WL 376994 (W.D. Pa. Jan. 23, 2020)).26Barbor v. State Farm Fire and Cas. Co., No. 24-521, 2024 WL 3678660, at *4–5 (E.D. Pa. Aug. 6, 2024)(citations omitted).27Id. at *6 (citation omitted).28ECF 1-5 27.29Id. 31.30Id. ¶¶ 15, 17.31Id. 30. Ms. Rosario later clarified Liberty Mutual made a settlement offer before she filed her suit but allegesLiberty Mutual made the offer in bad faith. ECF 15 14.32Carolan v. Progressive Advanced Ins. Co., No. 24-3248, 2025 WL 777708, at *5–7 (E.D. Pa. Mar. 11, 2025)(collecting cases).33“To state a bad faith claim, an insured ‘must do more than call [the insurer's] offers low-ball.’ ” Brown v. LMGen. Ins. Co., No. 21-2134, 2021 WL 3809075, at *3 (E.D. Pa. Aug. 26, 2021) (alterations in original) (quotingCanfield v. Amica Mut. Ins. Co., No. 20-2794, 2020 WL 5878261, at *4 (E.D. Pa. Oct. 2, 2020) (the insured's“subjective belief as to the value of her claims is not indicative of bad faith”)).34ECF 12-1 at 10–13. Liberty Mutual moves to strike the following paragraphs from Ms. Rosario's Complaint:15. Defendant has refused to fairly evaluate Plaintiffs underinsured motorist claim.16. Defendant has refused to make a good-faith settlement offer to resolve Plaintiff's underinsured motoristclaim.17. Defendant has made misrepresentations to Plaintiff regarding its evaluation of Plaintiff's underinsuredmotorist claim.Id. at 11 (citing ECF 1-5 ¶¶ 15–17).35ECF 15-1 at 7–9.
NYDIA ROSARIO v. LIBERTY MUTUAL PERSONAL INSURANCE..., Slip Copy (2026) © 2026 Thomson Reuters. No claim to original U.S. Government Works.736Fed. R. Civ. P. 12(f).37McInerney v. Moyer Lumber & Hardware, Inc., 244 F. Supp. 2d 393, 402 (E.D. Pa. 2002).38Sullivan v. Warminster Twp., No. 07-4447, 2010 WL 2164520, at *11 (E.D. Pa. May 27, 2010).39Id. (quoting Del. Health Care, Inc. v. MCD Holding Co., 893 F. Supp. 1279, 1291–92 (D. Del. 1995) (citationomitted)).40Meyer, Darragh, Buckler, Bebenek & Eck, P.L.L.C. v. Law Firm of Malone Middleman, P.C., 137 A.3d 1247,1258 (Pa. 2016).41Grudowski v. Foremost Ins. Co., 556 F. App'x 165, 168 (3d Cir. 2014) (quoting Widmer Eng'g, Inv. v. Dufalla,837 A.2d 459, 467–68 (Pa. Super. Ct. 2003)).42ECF 15-1 at 8 (“The factual averments contained in Paragraphs 15, 16, and 17 of Plaintiff's Complaintare relevant to Defendant's breach of contractual duties to Plaintiff. Therefore, Plaintiff has pled facts thatdemonstrate Defendant's failure to afford a fair evaluation of Plaintiff's claim, misrepresentations regardingsaid evaluation, and refusal to make a good-faith offer.”).End of Document© 2026 Thomson Reuters. No claim to original U.S. Government Works.
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