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Liberty Mutual Insurance Co. v. Travelers Casualty and Surety Co. of America

United States District Court, S.D. Mississippi, Northern Division

April 16, 2015

LIBERTY MUTUAL INSURANCE COMPANY, Plaintiff,
v.
TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA; COLOM CONSTRUCTION CO., INC. Defendants.

ORDER

CARLTON W. REEVES, District Judge.

Before the Court is Travelers Casualty and Surety Company of America's motion to dismiss. Docket No. 11. Having considered the allegations, arguments, and applicable law, the motion will be denied.

I. Factual and Procedural History

The following allegations are drawn from the complaint.

In 2012, the Mississippi Department of Transportation (MDOT) hired Hill Brothers Construction Company for a highway construction project. Liberty Mutual Insurance Company (Liberty) issued a surety bond for the work.

Hill Brothers subcontracted some of the work to Colom Construction Company. Travelers Casualty and Surety Company of America (Travelers) issued a performance and payment bond for the subcontract.

Hill Brothers defaulted. Liberty stepped into its shoes to satisfy its obligations to MDOT.

Liberty, or its contractor, became dissatisfied with Colom's work. When Colom did not correct the problems, Liberty called on Travelers to investigate and fix them. Travelers declined.

This suit followed. In it, Liberty seeks to recoup the money it will spend correcting Colom's deficient work.

Travelers' motion contends that Liberty lacks standing to make a claim on the performance and payment bond and that the complaint fails governing pleading standards.

II. Legal Standards

When considering a motion to dismiss under Rule 12(b)(6), the Court accepts the plaintiff's factual allegations as true and makes reasonable inferences in the plaintiff's favor. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). To proceed, the complaint "must contain a short and plain statement of the claim showing that the pleader is entitled to relief." Id. at 677-78 (quotation marks and citation omitted). This requires "more than an unadorned, the defendant-unlawfully-harmed-me accusation, " but the complaint need not have "detailed factual allegations." Id. at 678 (quotation marks and citation omitted). The plaintiff's claims must also be plausible on their face, which means there is "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citation omitted).

"A question of standing raises the issue of whether the plaintiff is entitled to have the court decide the merits of the dispute or of particular issues. Standing is a jurisdictional requirement that focuses on the party seeking to get his complaint before a federal court." Pederson v. Louisiana State Univ., 213 F.3d 858, 869 (5th Cir. 2000) (quotation marks and citation omitted). The standing inquiry asks whether the plaintiff has suffered a concrete injury, caused by the defendant, which may be redressed by a favorable ruling. Id. "When considering whether a plaintiff has standing, a court must accept as true all material allegations of the complaint, and must construe the complaint ...


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