NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 16-2088
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STEVEN LEBOON,
Appellant
v.
ZURICH AMERICAN INS. CO.
__________________________________
On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. Civ. No. 15-cv-05904)
District Judge: Honorable Gerald J. Pappert
__________________________________
Submitted Pursuant to Third Circuit LAR 34.1(a)
December 12, 2016
Before: SHWARTZ, COWEN and FUENTES, Circuit Judges
(Opinion filed: December 12, 2016)
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OPINION*
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PER CURIAM
Steven LeBoon appeals from an order of the District Court dismissing his
complaint and denying his motions for sanctions. For the reasons that follow, we will
affirm.
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LeBoon was hired by the Alan McIlvain Company (“AMC”) in September 2008,
and terminated from his position there as Human Resources Manager on May 8, 2009.
On May 9, 2012, he filed a complaint pro se in the United States District Court for the
Eastern District of Pennsylvania against AMC, alleging violations of the Americans with
Disabilities Act, 42 U.S.C. § 12101, et seq., and the Pennsylvania Human Relations Act
in that he was terminated just after he had suffered a workplace injury. The parties’
motions for summary judgment were denied and the case was set for trial. On the second
day of trial, LeBoon called to explain that he was having car trouble and could not get to
court that day. The District Judge assigned to the case declared a mistrial and ordered
LeBoon to show cause why his case should not be dismissed for failure to prosecute.
Specifically, the District Judge ordered LeBoon to provide proof of his car troubles.
After reviewing LeBoon’s response, the District Judge found that his claims of car
trouble were unsubstantiated and that he could have taken public transportation to court.
LeBoon’s case was dismissed for failure to prosecute pursuant to Poulis v. State Farm
Fire & Casualty Co., 747 F.2d 863 (3d Cir. 1984). We affirmed on appeal, see LeBoon v.
Alan McIlvain Co., 628 F. App’x 98 (3d Cir. 2015).
On October 29, 2015, LeBoon filed a pro se complaint in the Eastern District
against Zurich American Insurance Company, AMC’s liability insurer, alleging bad faith
in connection with his employment discrimination action, see 42 Pa. Cons. Stat. Ann. §
8371, common law bad faith, and breach of an implied covenant of good faith and fair
dealing. LeBoon’s allegations were premised on Zurich’s conduct while defending
AMC. Specifically, he claimed that Zurich, as AMC’s counsel and insurer, failed to
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make any good faith offers to settle the employment litigation and thus breached a duty
owed to him. LeBoon asserted that “Zurich was careless in unnecessary litigation using
over $1 million [and] leaving ZERO pennies for me.” Form Complaint, at ¶ III(C).
LeBoon also alleged a violation of the Employee Retirement Income Security Act of
1974 {“ERISA”), 29 U.S.C. §§ 1001, et seq.
Zurich filed a motion to dismiss the complaint for failure to state a claim on which
relief may be granted, Fed. R. Civ. P. 12(b)(6), attaching as an exhibit a copy of the
liability policy issued by Zurich American Insurance Company to Alan McIlvain
Company, effective February 14, 2009 to February 14, 2010. Zurich argued that its only
obligation under the liability policy was to defend and indemnify AMC, an obligation it
executed successfully, and that, because LeBoon had no basis for arguing that he was an
Insured under the policy, he had no basis for maintaining a civil action against Zurich
based on allegations of bad faith. LeBoon’s common law claims failed for the same
reason, Zurich argued, and ERISA had no application whatever to the case because the
liability policy at issue clearly was not an “employee welfare benefits plan” subject to
ERISA, see 29 U.S.C. § 1002(1).
Eight days after Zurich filed its motion to dismiss on the civil docket, LeBoon
filed a motion for sanctions against Zurich alleging that its counsel failed to properly
serve him with the motion to dismiss. LeBoon sought a default judgment in the amount
of $1,000,000.00. After Zurich responded to LeBoon’s motion for sanctions, asserting
that counsel for Zurich had properly served LeBoon via U.S. Mail, postage prepaid, at his
address of record, LeBoon filed a second motion for sanctions.
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In an order entered on April 18, 2016, the District Court granted Zurich’s motion
to dismiss the complaint and denied LeBoon’s motions for sanctions. Applying Federal
Rule of Civil Procedure 5(b)(2), the Court found that the certificate accompanying
Zurich’s motion to dismiss stated that the motion had been served via U.S. Mail, postage
prepaid, to LeBoon at 426 Buchanan Road, Perkasie, PA 18944, and that this certification
was sufficient to establish the presumption of regularity that an addressee has received a
properly addressed and mailed pleading. The Court further found that LeBoon had not
provided any evidence that he had changed his address, and his unsupported and
conclusory assertion that he never received Zurich’s motion to dismiss was insufficient to
show noncompliance by Zurich with Rule 5. The District Court went on to conclude that,
considering the motion to dismiss on the merits, LeBoon’s complaint failed to state a
plausible claim for relief. After reviewing the terms of the policy, the Court found that
LeBoon was not an Insured within the meaning of the policy. Accordingly, the Court
concluded, Zurich owed no duty to LeBoon to settle the employment discrimination case,
and thus none of his claims survived Zurich’s motion to dismiss.
LeBoon appeals. We have jurisdiction under 28 U.S.C. § 1291. After briefing
was complete, LeBoon filed a motion to stay this appeal pending the outcome of
discovery he says he is conducting in a case he has recently filed against AMC in the
Bucks County Court of Common Pleas. Zurich responded in opposition to the motion,
and also submitted a letter to the Court. LeBoon then filed a reply and a supplemental
motion, revising his request for a stay.
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We will affirm. We hold first that the District Court properly determined that
LeBoon failed to overcome the presumption of service of Zurich’s motion to dismiss the
complaint, and thus properly denied LeBoon’s motions for sanctions. A District Court’s
findings of fact are reviewed for clear error. See United States v. 6.45 Acres of Land,
409 F.3d 139, 145 (3d Cir. 2005). Federal Rule of Civil Procedure 5(b)(2)(C) provides
that a motion is properly served by “mailing it to the person’s last known address -- in
which event service is complete upon mailing.” Fed. R. Civ. P. 5(b)(2)(C). The District
Court did not clearly err in finding that Zurich complied with Rule 5’s service
requirements. “The common law has long recognized a presumption that an item
properly mailed was received by the addressee.” In re: Cendant Corp. Prides Litig., 311
F.3d 298, 304 (3d Cir. 2002). Once a certificate of service is filed asserting that a
pleading was properly addressed, had sufficient postage, and was served by being placed
in the U.S. mail, a presumption of regularity arises that the addressee received the
pleading. Id. Beyond his denial of receipt of Zurich’s motion to dismiss, LeBoon offered
no explanation or evidence, such as a recent change of address or problems with receipt
of mail, to rebut the presumption of receipt of the motion to dismiss.
We further hold that the District Court properly granted Zurich’s motion to
dismiss LeBoon’s complaint. When ruling on a defendant’s motion to dismiss, the Court
may consider a document explicitly relied upon in the complaint without converting the
motion to dismiss to a summary judgment motion. In re: Rockefeller Center Properties,
Inc. Securities Litigation, 184 F.3d 280, 287 (3d Cir. 1999). A Court may also consider
an “undisputedly authentic document that a defendant attaches as an exhibit to a motion
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to dismiss if the plaintiff's claims are based on the document.” Pension Benefit Guaranty
Corp. v. White Consolidated Industries, Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). Here,
the District Court properly relied upon the terms of Zurich’s liability insurance policy in
ruling on the motion to dismiss.
Review of a District Court’s decision to grant a motion to dismiss pursuant to Rule
12(b)(6) is plenary. A Rule 12(b)(6) motion tests the sufficiency of the factual
allegations contained in the complaint. See Kost v. Kozakiewicz, 1 F.3d 176, 183 (3d
Cir. 1993). A motion to dismiss should be granted if the plaintiff is unable to plead
“enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007). The plausibility standard “asks for more than a
sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). We look for “enough facts to raise a reasonable expectation that discovery
will reveal evidence of the necessary elements of” a claim for relief. Phillips v. County
of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (quoting Twombly, 550 U.S. at 556).
In that LeBoon plainly is not an Insured under the liability policy, he failed to state
a plausible claim for relief on his allegations of bad faith. Under the unambiguous terms
of the liability policy, Zurich’s only obligation was to provide for the defense and
indemnity of covered claims against AMC. It had no obligation to LeBoon, as AMC’s
adversary, to settle the employment litigation, and thus his bad faith claims cannot
survive Zurich’s motion to dismiss, just as the District Court concluded. See Strutz v.
State Farm Mutual Insurance Co., 609 A.2d 569, 571 (Pa. Super. Ct. 1992) (“[T]he duty
to negotiate a settlement in good faith arises from the insurance policy and is owed to the
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insured, not to a third-party claimant.”). In addition, the liability policy clearly is not an
“employee welfare benefits plan” subject to ERISA, see 29 U.S.C. § 1002(1).1
For the foregoing reasons, we will affirm the order of the District Court dismissing
LeBoon’s complaint pursuant to Rule 12(b)(6) and denying his motions for sanctions.
We will deny LeBoon’s motion and supplemental motion to stay this appeal because
additional discovery will not establish that Zurich owed him a duty to settle the
employment litigation.
1
Zurich notes in its brief that LeBoon previously filed ERISA actions in the Eastern
District of Pennsylvania against AMC’s group disability benefits insurer, asserting a
wrongful denial of long-term disability benefits under AMC’s employee benefit plan, see
LeBoon v. Allan McIlvain Co., et al., D.C. Civ. No. 10-cv-004035, and LeBoon v. Unum
Group, D.C. Civ. No. 11-cv-07069. Appellee’s Brief, at 5.
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