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Rizvi v. Allstate Corp.

United States District Court, D. Connecticut

September 25, 2019

NUSRAT RIZVI AND EILEEN RIZVI, Plaintiffs,
v.
ALLSTATE CORPORATION, DALLAS C. DODGE, SR., AND A. E. OBERHAUS, INC., Defendants.

          RULING AND ORDER ON MOTION TO DISMISS

          VICTOR A. BOLDEN UNITED STATES DISTRICT JUDGE.

         Dallas C. Dodge, Sr. and A.E. Oberhaus, Inc. (“Oberhaus”), both Defendants in this lawsuit, move to dismiss the Complaint of Nusrat Rizvi and Eileen Rizvi (“Rizvis” or, collectively, “Plaintiffs”) under Fed.R.Civ.P. 12(b)(4) for insufficient process, Fed.R.Civ.P. 12(b)(5) for insufficient service of process, and Fed.R.Civ.P. 10(b) for failing to separate each cause of action against them. Motion to Dismiss, ECF. No. 10 at 1 (Dec. 19, 2018) (“Oberhaus Mot.”); Memorandum of Law in Support of Motion to Dismiss, ECF No. 11 at 1 (Dec. 19, 2018) (“Oberhaus Mem.”). Additionally, they have moved to dismiss the Rizvi’s Civil Racketeer Influenced and Corrupt Organizations Act (“RICO”) claim for violating the statute of limitations, and all four counts of the Complaint under Fed.R.Civ.P. 12(b)(6). Oberhaus Mem. at 1.

         The Rizvis have objected.

         Allstate Corporation (“Allstate”), another Defendant, also moves to dismiss the Rizvis’s Complaint in its entirety, Motion to Dismiss, ECF No. 26 (Feb. 25, 2019) (“Allstate Mot.”), raising similar grounds for dismissal. Memorandum of Law In Support of Motion to Dismiss, ECF No. 27 (Feb. 25, 2019) (“Allstate Mem.”).

         The Rizvis have not filed anything in response to the Allstate motion to dismiss. See Docket Entries.[1]

         For the reasons explained below, the Court GRANTS the motions to dismiss.

         The sole federal claim in this lawsuit is dismissed and the Court declines to exercise supplemental jurisdiction over the remaining state law claims.

         I. FACTUAL AND PROCEDURAL BACKGROUND[2]

         A. Factual Allegations

         On or about January 6, 2004, allegedly after extensive water damage to their home, the Rizvis filed an insurance claim with the Allstate Corporation to pay for allegedly damaged furniture, which consisted of a Mastercraft dining set with a table and six chairs, as well as a Mastercraft china cabinet. Id. ¶¶ 11-12. The dining table allegedly is handmade in Italy with inlaid rosewood, gold leaf, and antique brass. Id. ¶ 14.

         Allstate allegedly employed Adam Colagrossi to appraise the damage to the dining table, and he did so, in consultation with Richard D. Orsi, an antiques and fine furniture restorer. Id. ¶¶ 16-17. On October 24, 2005, Mr. Orsi allegedly stated that he could not restore “the existing sheen exactly because of the finishing technique used by the manufacturer.” Id. ¶ 19. On October 26, 2005, Mr. Orsi also allegedly admitted that “it cannot be guaranteed that the main part of the table will exactly match the undamaged leaves” of the table.” Id. ¶ 20.[3]

         On October 27, 2005, Mr. Dallas Dodge, Sr., was selected as an umpire to oversee the appraisal dispute. Id. ¶ 21. Mr. Dodge allegedly acknowledged that the dining table sustained some water damage, but “opined that the matter had been ‘blown out of proportion.’” Id. ¶ 22 (citing Exhibit E, which is not found anywhere in the materials filed by Plaintiff to the Court). Mr. Dodge allegedly awarded the Rizvis $3, 709.68, “an amount substantially less than the cost it would take to repair and/or replace their dining table.” Id. ¶ 24.

         The Rizvis allege that it would cost $150, 000 to restore the table to its original condition, far more than the amount awarded by Mr. Dodge and Allstate. Id. ¶ 25.

         B. Procedural History

         On November 27, 2018, the Rizvis sued the Allstate Corporation (“Allstate”), Dallas C. Dodge, Sr. (“Mr. Dodge” or “Dodge”), and A.E. Oberhaus, Inc. (“Oberhaus”) (collectively, “Defendants”) in this Court. See Complaint ¶ 1.

         The Rizvis alleged one federal claim and three common law claims: violation of the Civil RICO Act, 18 U.S.C. § 1961 (Count One), id. ¶¶ 26-31; fraudulent concealment (Count Two), id. ¶¶ 32-40; fraudulent misrepresentation (Count Three), id. ¶¶ 41-29; and negligent misrepresentation (Count Four), id. ¶¶ 50-55.

         In support of their first cause of action under the Civil Racketeer Influenced and Corrupt Organizations Act (“RICO”), the Rizvis allege that a “special relationship” existed over many years between the defendants, such that “[Mr. Dodge] and [Oberhaus] were used by [Allstate] to act as umpire for claims” between Allstate and its claimants, “which were in dispute because claimants believed they were severely [underpaid] for their insurance claims.” Id. ¶ 27.

         In exchange for “a steady stream of clients, ” Mr. Dodge and Oberhaus allegedly would help to ensure that Allstate would pay far less than they should in the event of a loss. Id. ¶ 28. The Rizvis allege that Allstate’s home office in Illinois gave specific instructions to Mr. Dodge and Oberhaus, thus conducting the enterprise across state lines, and that, over the course of many years, the Defendants corresponded about their special relationship by mail, e-mail, and telephone. Id. ¶ 29.

         In support of their second cause of action under fraudulent concealment, the Rizvis further allege that, in July of 2018, Mr. Rizvi discovered through conversations with a few former Allstate employees “that a business relationship existed between” the Defendants, “whereby the parties conspired to defraud policyholders and significantly lessen the amounts which would be paid to them in the event of a loss.” Id. ¶ 33. Mr. Dodge and Oberhaus would serve as an umpire for disputed insurance claims and award “substantially lower than that which was needed to cover the losses of policyholders.”[4] Id. ¶ 35.

         The Rizvis allege that this business relationship was never disclosed to them, and had they been aware of the special relationship that allegedly existed, they would not have entered into a contract with Allstate on December 23, 2003. Id. ¶ 37. “But for the similarity discovered amongst other policyholders, Mr. Rizvi never would have been aware of the fraud not to mention being reasonably able to discover this fraudulent activity.” Id. ¶ 39.

         In support of their third cause of action under fraudulent misrepresentation, the Rizvis allege that an Allstate agent assured them in December 2017[5] that “high-quality items within [their] home” would be protected under Allstate’s homeowner’s insurance policy. Id. ¶¶ 42-45. The Rizvis allegedly relied on these representations when they entered into a homeowner’s insurance contract with Allstate on December 23, 2017. Id. ¶ 46. The Rizvis allege Allstate and its agents knew these statements were false due to their “long-standing relationship with [Mr. Dodge] and [Oberhaus], which guaranteed that they would not have to honor their contractual commitments, ” id. ¶¶ 47-48, and that they did not honor the Rizvis’s policy in light of the loss suffered on January 6, 2004, instead offering “a mere $3, 709.68” for a policy with coverage up to $249, 000. Id. ¶¶ 46, 49.

         Finally, in support of their fourth cause of action under negligent misrepresentation, the Rizvis allege that, on December 23, 2003, they were misled by the Allstate agent’s representations “that their home would be covered in the event of damage to the structure as well as providing protection of the items inside the home.” Id. ¶ 51. The Rizvis allege that the business relationship between the Defendants was intentionally concealed from them and others “with the specific intention to deceive otherwise [Allstate] would have disclosed their relationship prior to luring [the Rizvis] into a homeowner’s insurance contract.” Id. ¶ 54.

         The Rizvis allege that they suffered harm because their possessions were not protected. They seek compensatory damages in the amount of $150, 00 for the replacement of insured personal property, interests and costs, common law punitive damages, and any other relief that the Court deems just.

         On December 12, 2018, Mr. Dodge and Oberhaus submitted a motion to dismiss along with a supporting memorandum. See Oberhaus Mot.; Oberhaus Mem.

         They argue that the Rizvis failed to comply with Federal Rules of Civil Procedure 4 and 10(b), and the Complaint therefore should be dismissed. See Oberhaus Mot. at 1. These two Defendants also argue that Plaintiffs’s RICO claim is barred by the statute of limitations and should be dismissed. See Id . Finally, Defendants argue that the Rizvis’s Complaint should be dismissed for failure to state a claim under Rule 12(b)(6). See id.

         On January 2, 2019, the Rizvis filed a motion to disqualify Judge Victor A. Bolden from hearing this case. See Motion to Disqualify Judge, ECF No.12 (Jan. 2, 2019). Treating the Rizvis’s motion to disqualify as a motion for recusal, the Court denied the motion on January 10, 2019. See Ruling and Order on Motion for Recusal, ECF No. 13 (Jan. 10, 2019).

         On February 1, 2019, the Rizvis submitted an objection to Defendants’s motion to dismiss. See Objection to Motion to Dismiss, ECF No. 22 (Feb. 1, 2019) (“Rizvi Obj.”).

         On February 15, 2019, these two Defendants filed a reply to Plaintiffs’s objection. to the motion. See Reply, ECF No. 23 (Feb. 15, 2019) (“Oberhaus Reply”).

         On February 25, 2019, Allstate filed a motion to dismiss the Rizvis’s complaint. See Allstate Mot.; Allstate Mem.

         The Rizvis have not responded to this motion.[6]

         II. STANDARD OF REVIEW

         A motion to dismiss under Rule 12(b)(4) requires that a defendant establish insufficient process under Rule 4 of the Federal Rules of Civil Procedure. “A 12(b)(4) motion is proper only to challenge noncompliance with the provisions of Rule 4(b) or any applicable provision incorporated by Rule 4(b) that deals specifically with the content of the summons.”[7] 5B C. Wright & A. Miller, Federal Practice and Procedure: Civil 3d § 1353; Green v. Wright, 389 F.Supp.2d 416, 426 (D. Conn. 2005).

         Under Federal Rule of Civil Procedure 12(b)(5), a party may file a motion to dismiss due to “insufficient service of process.” Fed.R.Civ.P. 12(b)(5). “A motion to dismiss pursuant to Rule 12(b)(5) must be granted if the plaintiff fails to serve a copy of the summons and complaint on the defendants pursuant to Rule 4 of the Federal Rules, which sets forth the federal requirements for service.” Rzayeva v. United States, 492 F.Supp.2d 60, 74 (D. Conn. 2007). Once a defendant challenges validity of service, “it becomes ...


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