The opinion of the court was delivered by: Jose L. Linares United States District Judge
C H AM B ER S O F M A R TIN L U T HE R K IN G JR. JOSE L. LINARES FE D E R A L B U IL D IN G & U.S. C OU R T H O USE JU DG E 50 W A L N U T ST ., R O O M 5054 P.O . B ox 999 Newark, NJ 07101-0999 973-645-6042 (973) 645-3110
This matter comes before the Court by way of two motions: (1) a motion to dismiss Plaintiff's Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) filed by Defendants Joel Boyarsky and Improved Funding Techniques, Inc., and (2) a motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) filed by Defendant Aviva Life and Annuity Company [Docket Entry Nos. 9 and 15]. The Court has considered the submissions made in support of and in opposition to the instant motions. No oral argument was heard. Fed. R. Civ. P. 78. Based on the reasons that follow, Defendants' motions are granted in part. Counts One, Two and Three of Plaintiff's Complaint are dismissed without prejudice. Plaintiff is granted leave to file an Amended Complaint which cures the pleading deficiencies in these claims.
Plaintiff, Allen Glushakow, M.D. is a practicing orthopedic surgeon who maintains offices in Livingston and Elizabeth, New Jersey. (Compl., ¶ 1). Plaintiff purchased a life insurance policy (the "Policy") (sold by Indianapolis Life Insurance Company) from Defendant Joel Boyarsky, a licensed insurance broker and the founder and CEO of Defendant Improved Funding Techniques, in or around February 2005. (Compl., ¶¶ 2-6). In doing so, Plaintiff relied on Boyarsky's assurances that the Policy was a "conservative investment well-suited to the plaintiff's estate and retirement planning objectives." (Compl., ¶ 6). Defendant Aviva Life and Annuity Company is the successor in interest to Defendant Indianapolis Life Insurance Company, which ceased to exist on or around October 2008. (Compl., ¶ 4).
In or around March 2010, Plaintiff discovered that the Policy was, in fact, unsuitable as a retirement and investment vehicle for several reasons, including but not limited to, the fact that the Policy was designed in such a way that its cash value declined beginning in year twenty (20) to zero by year twenty-five (25). (Compl., ¶ 7(a)). Thus, by year twenty-five (25), the Policy would become worthless. (Id.). The Complaint alleges that Defendants not only failed to inform the Plaintiff that the cash value of the Policy declines beginning in year twenty (20), but also provided documents to the Plaintiff which were designed to create the misleading impression that the cash value continued to increase throughout the life of the policy. (Id.). Plaintiff maintains that Defendants concealed such material facts by, inter alia, using materials that included an illustration of cash values only through year twenty -- that is, by specifically omitting the cash values beyond the twentieth policy year. (Compl., ¶ 8).
In light of the foregoing allegations, Plaintiff commenced the instant cause of action against Defendants Joel Boyarsky, Improved Funding Techniques, Inc., and Aviva Life and Annuity Company (as successor in interest to the Indianapolis Life Insurance Company) in the Superior Court of New Jersey, Chancery Division, Essex County in April 2011. The action was removed to this Court in May 2011. Plaintiff's Complaint asserts various claims for relief, including but not limited to: (1) common law fraud, (2) violation of the New Jersey Consumer Fraud Act, (3) breach of contract, (4) breach of fiduciary duty, and (5) negligent misrepresentation.
Rule 12(c) provides that "[a]fter the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings." Where, as here, a motion for judgment on the pleadings alleges that the complaint fails to state a claim upon which relief can be granted, the court applies the same standards as under Rule 12(b)(6). Turbe v. Government of Virgin Islands, 938 F.2d 427, 428 (3d Cir.1991).
For a complaint to survive dismissal under Rule 12(b)(6), it "must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In determining the sufficiency of a complaint, the Court must accept all well-pleaded factual allegations in the complaint as true and draw all reasonable inferences in favor of the non-moving party. See Phillips v. County of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008). But, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions [;][t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 129 S.Ct. at 1949. Additionally, in evaluating a plaintiff's claims, generally "a court looks only to the facts alleged in the complaint and its attachments without reference to other parts of the record." Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir. 1994). With this framework in mind, the Court tuns now to Defendants' motions.
Defendant Aviva Life and Annuity Company seeks dismissal of Counts One, Two and Three of Plaintiff's Complaint on the following grounds: (1) Plaintiff's fraud-based claims (Counts One and Two) are not pled with sufficient particularity pursuant to Rule 9(b), (2) the New Jersey Consumer Fraud Act (Count Two) does not apply to the sale of a life insurance policy to a defined benefit plan, and ...