Montfort, Healy, McGuire & Salley Successfully defends an Insurance Adjuster in federal court against a § 1983 Claim

Fiore v. Rivera 2015 WL 5007938

Recently, James M. Murphy of Montfort, Healy, McGuire & Salley LLP successfully represented an insurance adjuster in a case that was commenced in the United States District Court for the Eastern District. The client was a defendant in a claim that arose as a result of alleged false arrest and malicious prosecution.

The suit concerned the plaintiff’s arrest on a charge of grand larceny that resulted from a dispute concerning the costs of car repair services, which the plaintiff performed. After the individual who owned the car asserted that no service work had been performed on the vehicle, the owner claimed that he attempted to retrieve the money he had spent on the repairs from the plaintiff. When the alleged attempt failed, the owner of the car filed a criminal complaint with the police. The plaintiff was ultimately arrested on charges of grand larceny and falsifying business records.

After the plaintiff’s acquittal, the car owner filed a complaint with the New York State Department of Motor Vehicles. At the hearing, the administrative law judge imposed civil monetary penalties and revoked the plaintiff’s repair shop license.

The plaintiff then filed an action against the Suffolk County Police Department under 42 U.S.C. § 1983 on the grounds of false arrest and malicious prosecution in violation of the Fourth amendment. Additionally, he commenced an action against the car owners and the insurance adjuster, asserting malicious prosecution.

The insurance adjuster filed a motion to dismiss for failure to state a claim. The Court agreed with the defendants and dismissed the plaintiff’s motion because, in order to state a § 1983 action, the entity accused must have acted under the color of law, which is not generally an applicable assertion against a private citizen, unless that citizen acted in concert with the government to deprive the plaintiff of constitutional rights. The court found that even if the two non-county defendants did make false comments or statements concerning the plaintiff’s repair business, it did not rise to the level necessary to constitute state action.

Additionally, the court found that the plaintiff was not collaterally estopped from asserting a lack of probable cause. However, it also found that the complaint did not sufficiently allege probable cause under the plausibility standard.

Claims against all defendants in the case were dismissed without prejudice.

To read the full case, click here.