govinfo:USCOURTS-pawd-2_25-cv-01966-0

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IN THE UNITED STATES DISTRICT COURT 
FOR THE WESTERN DISTRICT OF PENNSYLVANIA 
 
  
ELIZABETH FORWARD SCHOOL 
DISTRICT, 
 
  
  Plaintiff, Civil Action No. 2:25-cv-1966 
  
v. Hon. William S. Stickman IV 
  
CM REGENT INSURANCE COMPANY,  
  
  Defendant.  
  
 
MEMORANDUM OPINION 
 
WILLIAM S. STICKMAN IV, United States District Judge  
Plaintiff Elizabeth Forward School District (“EFSD”) filed a two-count complaint against 
Defendant CM R egent Insurance Compa ny ( “CM R egent”) in the Court of Common Pleas  of 
Allegheny County, Pennsylvania.  EFSD alleges a breach of its insuran ce policy and that CM 
Regent engaged in b ad faith with respect to its coverage decision under the  insurance policy.  
(ECF No. 1-1).  CM Regent removed the action.  (ECF No. 1).   EFSD filed a motion to remand 
(ECF No. 9), which the Court denied (ECF No. 17).  Pending before the Court is the Motion of 
Defendant, CM Regent Insurance Company, to Dism iss Count II – Bad Faith, 42 P.S. § 8371 
from Plaintiff’s Complaint and to strike immaterial, impertinent and/or scandalous allegations in 
the complaint.  (ECF No. 6).  For the following reasons, the motion will be denied. 
I. FACTUAL BACKGROUND 
 This case arises out of a fire in the auditorium of Elizabeth For ward High School.  (ECF 
No. 1-1, p. 5).  As a result o f the fire and firefighting efforts, the auditorium was destroyed and 
adjacent areas  were severely damaged.  (Id.).  EFSD had an insurance policy issued by CM 
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Regent, which obligates it to “pay for di rect physical loss of or damage to Covered Proper ty at 
the premises described in the Declarations caused by or res ulting from any Covered Cause of 
Loss.  (Id.).  EFSD alleges that the auditorium and a djacent areas are covered property.  ( Id. at 
6).  Likewise, it pleads that the fire was a covered cause of loss.  (Id.). 
 EFSD has begun construction of a new auditorium on the same premises, but on the other 
side of the building. ( Id.).  It alleges that this was necessary to maintain the original seating  
capacity, which i t represents was 798 seats, while complyin g with the current Americans with 
Disabilities Act and its Accessibility Guid elines (“ADAAG”).  ( Id. at 7).  According to EFSD, 
rebuilding the auditorium in the original location consistent with  the ADAAG would have 
encroached on the lobby, gym and library of the school.  (Id.). 
 CM Regent used John C. Sopczynski (“Sopczynski”) of Sedgwick as its claims adju ster.  
(Id.).  EFSD’s contractor sent Sopczynski a Dropbox link that included the original draw ing for 
the auditorium.  ( Id. at 8).  Sedgw ick retained J.S. Held to evaluate the rebuilding plans.  J.S.  
Held assigned the work to Erik Fritzber g (“Fritzberg”), a registered architect.  (Id.).  Fritzberg 
toured the site of the burned auditorium and concluded that the pre-fire structure had a seating 
capacity of 530 seats.  (Id.).  Based on this capacity, he opined that the aud itorium could be 
rebuilt in the original location.  (Id.).  EFSD alleges that Fritzberg reached his conclusion on 
capacity despite the fact that h e had evidence that the original capacity was 7 98 seats.  ( Id.)  It 
contends that it pointed out Fritzberg’s alleged error to Sedgwick, but that Sedgwick ignored the 
evidence and, indeed, attacked the rebuilding plans of EFSD’s contractor.  (Id. at 9).     
 Fritzberg issued a Suppleme ntal Auditorium Report on August 27, 2025, that claims that 
EFSD withheld requested information about the auditorium.  EFSD counters that the report 
concealed Fritzberg’s knowledge that CM Regent had the drawings of the auditorium since June 
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2024.  ( Id.).  EFSD pleads that, despite actual knowledge that the auditor ium’s actual capacity 
was almost 50% lar ger than his initial assessment, Fritzberg refused to amend hi s assessment.  
(Id. at 10). 
 The complaint alleges that Fritzberg’s inaccurate report was delivered to CM Regent, and 
that it formed the basis of CM Regent’s coverage decision.  Ultimately, CM Regent concluded 
that it was not necessary to rebuild the auditorium in the new location  because it could be rebuilt 
in the original footprint.   (Id.).  CM Regent also disclaim ed liability for paying to replace the 
foundation and caissons under the destroyed auditorium  and for replacing damaged equipment 
and systems in the boiler and mechanical rooms, as well as a d amaged gymnasium floor.  (Id. at 
11-12).  EFSD alleges that CM Regent’s coverage decision is a breach of the insurance policy.  
Further, it contends that the decision was made in bad faith in violation of Penn sylvania’s 
insurance bad faith statue, 42 P.S. § 8371.   
II. ANALYSIS 
A. MOTION TO DISMISS COUNT II   
  1. Standard of review for a Rule 12(b)(6) motion. 
 A motion to dismiss filed under Federal Rule of Civil Procedure  (“Rule”) 12(b)(6) tests 
the legal sufficiency of the complaint.  Kost v. Kozakiewicz, 1 F.3d 176,  183 (3d Cir. 1993) .  A 
plaintiff must allege sufficient facts that, if accepted as true, state  a claim for relief plausible on  
its face.  See Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555 (2007) ; see also Ashcroft v. Iqbal , 
556 U.S. 662, 678 (2009) .  A co urt must accept all we ll-pleaded factual allegations as true and 
view them in the light most fa vorable to a plaintiff.  See Doe v. Princeton Univ. , 30 F.4th 335, 
340 (3d Cir. 2022); see also Fowler v. UPMC Shadyside , 578 F.3d 203, 210 (3d Cir. 2009) .  
Although a court must acce pt the allegations in the complaint as true, it is “not compelled to 
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accept unsupported conclusions and u nwarranted inferences, or a legal conclusion couched as a 
factual allegation.”  Baraka v. McGreevey, 481 F.3d 187, 195 (3d Cir. 2007) (citations omitted).  
  The “plausibility” standard required for a complaint to survive a motion to dismiss is not 
akin to a “probability” requirement but asks for more than sheer “possibility.”  Iqbal, 556 U.S. at 
678 (citing Twombly, 550 U.S. at 556 ).  In other words, the compl aint’s factual allegations must 
be enough to raise a right to reli ef above the speculative level, on the assumption that all the 
allegations are true even if doubtful in fact.  Twombly, 550 U.S. at 555.  Facial plausibility is 
present when a plaintiff plea ds factual c ontent that a llows the court to draw the reasonable 
inference that a defendant is liable for the misconduct alleged.  Iqbal, 556 U.S. at 678.  Even if 
the complaint’s well -pleaded facts lead to  a plausible inference , that inference alone will n ot 
entitle a plaintiff to relief.  Id. at 682.  The complaint must  support the inference with fact s to 
plausibly justify that inferential leap.  Id.   
  2. EFSD pled a plausible bad faith claim. 
 EFSD brings its bad faith action under the Pennsylvania bad faith law, which provides: 
In an action arising under an insurance policy , if the court finds that the insurer 
has acted in bad faith toward the insured, the court may take all of the following 
actions: 
 
(1) Award interest on the amount of the claim from the date the claim was mad e 
by the insured in an amount equal to the prime rate of interest plus 3%. 
 
(2) Award punitive damages against the insurer. 
 
(3) Assess court costs and attorney fees against the insurer. 
 
42 P.S. § 8371.  The insured can show bad faith by offering clear an d convincing evidence that 
the insurer: (1) “did not have a reasonable basis for denying benefits under the policy”; and (2) 
“knew of or recklessly disregarded its lack of reasonable basis in denying the claim.” Amica Mut. 
Ins. Co . v. Fogel , 656 F.3d 167, 179 (3d Cir. 2011) (quoting Terletsky v. Pru dential Prop. & 
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Cas. Ins. Co., 649 A.2d 680, 688 (Pa. Super. 1994)); see also Rancosky v. Wash. Nat ’l Ins. Co., 
170 A.3d 364, 377 (Pa. 2017).   Courts interpreting § 8371 have identified three specifi c acts 
constituting bad faith: (1) frivolous or unfo unded refusal to pay, (2) failure to investigate the 
facts, and (3) failure to communicate with the insured.  Woistman v. Nationwide Mutual Ins. Co., 
Civil Action No. 2:19 -cv-01279, 2019 WL 13221264, *3 ( W.D. Pa. Dec. 6,  2019) (citing 
Hanover Ins. Co. v. Ryan, 619 F.Supp.2d 127, 140 (E.D. Pa. 2007)).   
 EFSD does not have to prove its case at this stage.  Rather, t he only question is whether, 
taking all of the allegations in the complaint as true, EFSD has pled a plausible bad faith claim.  
The Court holds that it has. Count II of the complaint alleges that CM Regent “did not have a 
reasonable basis for its breach of contract ,” and “knew of or recklessly disregarded its lack of a 
reasonable basis [for honoring its alleged coverage obligations].”  (ECF No. 1-1, p. 15).  The bad 
faith allegations specifically reference and incorporate  paragraph 80 of t he complaint, which 
highlights a number of wa ys that EFSD claims CM Regent breached its obligations u nder the 
insurance policy and failed to appropriately investigate the claim.   (Id. at 13-14).   
 The Court notes that there a re a number of alle gations in the complaint that, if 
substantiated, could evidence bad faith in the investigation of EFSD’s claim.  For example, a key 
difference in po sition between EFSD and CM Regent is the capacity of the pre-fire auditorium.  
The seating capacity is a question of fact  that may have important implications on the ultimate 
coverage decision.  EFSD alleges that CM Regent was provided with multiple forms of evidence 
that show that the auditorium held nearly 800 people.  Yet, it alleges that CM Regent ignored the 
evidence and relied on a n allegedly questionable investigation suggesting a capacity of only 500 
people.  The complaint also all eges a number of other covera ge decisions by CM Regent that 
plausibly stem from a failure to properly investigate EFSD’s claims.  Finally, to the extent that 
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CM Re gent’s coverage decisions were based on an actionably deficient investigation, it may 
plausibly be found to have engaged in a frivolous or unfounded refusal to pay.   
 When reviewing the allegations of the  complaint as a whole, the Court  holds that EFSD 
has pled enough to sur vive CM Regent ’s motion to dismiss.  It will be perm itted to take 
discovery to explore the contours of its claims.  
 B. MOTION TO STRIKE 
  1. Standard of review for a Rule 12(f) motion. 
 
Under Rule 12(f), a court may strike content of a complaint that is “immaterial, 
impertinent, and/or scandalous.”  FED. R. CIV. P. 12(f).  Here, CM Regent’s motion to strike aims 
to s trike alle gations that it deems to be immaterial .  “Content is immaterial when it has no 
essential or important relationship to the claim for relief.”   Champ v. USAA Casualty Insurance 
Company, No. 5:20-cv-01238, 2020 WL 1694372, at *2 (E.D. Pa. Apr. 7, 2020) (quoting Lee v. 
Eddystone Fire & Ambulance , No. 19 -cv-3295, 2019 WL 6038535, at *2 (E.D. Pa. Nov. 13, 
2019) (quotation omitted)) .  The Court maintains sound discretion in such a motion.   American 
Power, LLC v. Speedco., Inc., No. 1:15 -cv-2091, 2016 WL 6563671, at *1 (M.D. Pa., Nov . 4, 
2016).  To strike a pleading is a “drastic remedy” and the Court will not resor t to it absent 
demonstrable prejudice.  See In re Chambers Dev. Sec. Litig ., 848 F. Supp. 602, 617 (W .D. Pa. 
1993) (citing Great West Life Assur . Co. v. Leviathan , 834 F. Supp. 858, 862 (E.D. Pa. 1993)).   
Thus, in order to prevail on a motion to strike, t he moving party must demonstrate that “the 
allegations have no possible relation to the controversy an d may cau se prejudice to one of the 
parties, or [that] the allegations confuse the issues.”   DeLa Cruz v. Piccari Press , 521 F. Supp. 
2d 424, 428–29 (E.D. Pa. 2007). 
 
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  2. There is no need to strike any allegations in the complaint. 
 
 CM Regent asks the Court to strike paragraphs 49, 50, 51, 55, 56, 59, 80(j), 80(m), 80(n), 
80(q), 80(s), and 85 of the complaint.  These allegations generally relate to the work of Fritzberg 
in undertaking the investigation into EFSD’s claims on behalf of CM Regent.  The motion argues 
that these paragraphs , particularly paragraphs 49, 50, 51, 55, 56, and 59, “have no bearing on 
Plaintiff’s breach of contract claim or bad faith claim, and improperly cast a derogatory light on 
Fritzberg and CM Regent.”  (ECF No. 8, p. 20).   
 The Court holds that CM Regent has not met its burden to warrant the drastic remedy of 
striking the al legations targeted by the motion t o strike.  The allegations are not immaterial .  
They relate to  EFSD’s theor y that Fritzberg mishandled the in vestigation into the insurance 
claim.  They are not scandalous.  CM Regent cannot reasonably establish that these allegations—
which are relatively munda ne—are unduly prejudicial to CM Regent .  The re is no meri t to the 
motion to strike and it will be denied.   
III. CONCLUSION 
 For the reaso ns se t forth above, CM Regent ’s partial motion to dismiss and motion to 
strike will be denied by Order of Court to follow. 
BY THE COURT: 
 
 
 
s/  William S. Stickman IV   
WILLIAM S. STICKMAN IV 
UNITED STATES DISTRICT JUDGE 
 
April 29, 2026 
Date 
 
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