Gerling Global Reinsurance Corp. of America v. Low, 01-17023.

• Decision Date: 15 July 2002
• Docket Number: No. 01-17023.,No. 01-17433.,No. 02-15282.,01-17023.,01-17433.,02-15282.
• Citation: 296 F.3d 832
• Parties: GERLING GLOBAL REINSURANCE CORP. OF AMERICA; Gerling Global Reinsurance Corp. — U.S. Branch; Gerling Global Life Reinsurance Company; Gerling Global Life Insurance Company; Gerling America Insurance Company; and Constitution Insurance Corp., Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. LOW, in his capacity as the Commissioner of Insurance of the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee. Assicurazioni Generali, Plaintiff-Appellee-Cross-Appellant-Plaintiff-Appellant, v. Harry W. Low, individually, and in his capacity as the Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee. Winterthur International America Insurance Company, Winterthur International America Underwriters Insurance Company; General Casualty Company of Wisconsin, Regent Insurance Company; Republic Insurance Company; Southern Insurance Company, Unigard Indemnity Company; Unigard Insurance Company; and Blue Ridge Insurance Company, Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. Low, in his capacity as Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee. American Insurance Association and American Re-Insurance Company, Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. Low, in his capacity as Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

296 F.3d 832

GERLING GLOBAL REINSURANCE CORP. OF AMERICA; Gerling Global Reinsurance Corp. — U.S. Branch; Gerling Global Life Reinsurance Company; Gerling Global Life Insurance Company; Gerling America Insurance Company; and Constitution Insurance Corp., Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. LOW, in his capacity as the Commissioner of Insurance of the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee.

Assicurazioni Generali, Plaintiff-Appellee-Cross-Appellant-Plaintiff-Appellant, v. Harry W. Low, individually, and in his capacity as the Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee.

Winterthur International America Insurance Company, Winterthur International America Underwriters Insurance Company; General Casualty Company of Wisconsin, Regent Insurance Company; Republic Insurance Company; Southern Insurance Company, Unigard Indemnity Company; Unigard Insurance Company; and Blue Ridge Insurance Company, Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. Low, in his capacity as Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee.

American Insurance Association and American Re-Insurance Company, Plaintiffs-Appellees-Cross-Appellants-Plaintiffs-Appellants, v. Harry W. Low, in his capacity as Insurance Commissioner for the State of California, Defendant-Appellant-Cross-Appellee-Defendant-Appellee.

No. 01-17023.

No. 01-17433.

No. 02-15282.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 8, 2002.

Filed July 15, 2002.

As Amended on Denial of Rehearing and Rehearing En Banc September 9, 2002.^*

COPYRIGHT MATERIAL OMITTED

Frank Kaplan, Jesse Contreras, Ryan S. Hedges, Alschuler Grossman Stein & Kahan LLP, Los Angeles, CA, Leslie Tick, California Dept. of Insurance, San Francisco, CA, Andrew W. Stroud, Mennemeier, Glassman & Stroud, LLP, Sacramento, CA, Michael D. Ramsey, San Diego, CA, for the defendant-appellant-cross-appellee-defendant-appellee.

George L. O'Connell, Stevens & O'Connell LLP, Sacramento, CA; Frederick W. Reif, Wilson Elser Moskowitz Edelman & Dicker LLP, New York, NY; Sally Agel, Milbank, Tweed, Hadley & McCloy LLP, Los Angeles, CA; William H. Webster, Milbank, Tweed, Hadley & McCloy LLP, Washington, DC; and Kenneth S. Geller and Neil M. Soltman, Mayer, Brown, Rowe & Maw, Washington, DC, for the plaintiffs-appellees-cross-appellants-plaintiffs-appellants.

Mark B. Stern and Douglas Hallward-Driemeier, Department of Justice, Washington, DC; H. Lee Roussel, Assistant Attorney General, Office of the Attorney General, Olympia, WA; Daniel J. Siegel, Supervising Deputy Attorney General, Office of the Attorney General, Sacramento, CA; David A. Lash, Bet Tzedek Legal Services, Los Angeles, CA; and Roger M. Witten, Wilmer, Cutler & Pickering, Washington, DC, for the amici curiae.

Appeals from the United States District Court for the Eastern District of California; William B. Shubb, District Judge, Presiding. D.C. No. CV-00-00506-WBS, CV-00-00875-WBS, CV-00-00779-WBS, CV-00-00613-WBS.

Before GOODWIN, GRABER, and PAEZ, Circuit Judges.

GRABER, Circuit Judge.

This case comes before us for the second time. Plaintiffs, which are various insurance companies and a trade association of insurance companies, brought the present action to enjoin Defendant Harry W. Low, the Insurance Commissioner of the State of California (Commissioner), from enforcing a California statute requiring disclosure of information about Holocaust-era insurance policies. The district court permanently enjoined enforcement of the statute. The main question for decision is this: May California constitutionally require the disclosure of insurance claims-related information by an insurance company that is licensed to do business in California even though the required information may be in the hands of a related entity that is located in a foreign country? We answer that question "yes" and, accordingly reverse the judgment of the district court and vacate the injunction.

FACTUAL AND PROCEDURAL HISTORY

The Holocaust Victim Insurance Relief Act of 1999, Cal. Ins.Code §§ 13800-13807 (HVIRA), requires any insurer doing business in California that sold insurance policies to persons in Europe that were in effect between the years 1920 and 1945 (Holocaust-era policies) to file certain information about those policies with the Commissioner.¹ Cal. Ins.Code § 13804(a). The reporting requirement also applies to insurance companies that do business in California and are "related" to a company that sold Holocaust-era policies, even if the relationship arose after the policies were issued. Id. A "related company" is defined as any "parent, subsidiary, reinsurer,² successor in interest, managing general agent, or affiliate company of the insurer." Id. § 13802(b). The statute instructs the Commissioner to store the information in a "Holocaust Era Insurance Registry," which is to be made available to the public. Id. § 13803. The Commissioner "shall suspend the certificate of authority to conduct insurance business in the state of any insurer that fails to comply" with the reporting requirements, until the insurer complies. Id. § 13806.

Plaintiffs filed four separate actions in which they sought to enjoin the enforcement of HVIRA. The original complaints were filed by

(1) Gerling Global Reinsurance Corp. of America and its affiliates (collectively, Gerling), who are, according to their complaint, "arguably `affiliated' [with]... or `related [to]'" two German insurers that issued Holocaust-era policies; (2) American Insurance Association (AIA), a nonprofit trade association of insurers whose member-insurers are required to report under HVIRA, and American Reinsurance Company, a wholly owned subsidiary of a German corporation "that has investment interests in European insurance companies that do issue insurance policies"; (3) Winterthur International America Insurance Company, its affiliates, and numerous other insurance and underwriting companies (collectively, Winterthur), who are "arguably `related companies'... with more than forty insurance companies currently located in Europe"; and (4) Assicurazioni Generali (Generali), an Italian insurance company that issued Holocaust-era policies and currently does business in California.

Gerling Global Reins. Corp. of Am. v. Low, 240 F.3d 739, 742 (9th Cir.2001) (Gerling I), cert. dismissed, ___ U.S. ___, 122 S.Ct. 1907, 151 L.Ed.2d 961 (2002).

Plaintiffs sought declaratory and injunctive relief, claiming that HVIRA violated a number of constitutional provisions. Additionally, Plaintiff Gerling asked the court to review two statutes that were enacted at the same time as HVIRA: (1) California Code of Civil Procedure § 354.5, which allows California residents to bring claims for the payment of Holocaust-era insurance policies and extends the statute of limitations on such claims until December 31, 2010; and (2) California Insurance Code § 790.15, which instructs the Commissioner to suspend the certificate of authority of any insurer who has failed to pay on valid Holocaust-era policies. The Commissioner, in his motion to dismiss, argued that Gerling did not have standing to challenge these two additional statutes. The district court granted the motion to dismiss the additional challenges because Gerling had not established an imminent threat of prosecution. Gerling did not appeal that ruling. Gerling I, 240 F.3d at 742-43.

The district court issued an order granting Plaintiffs' motions for preliminary injunction and enjoined enforcement of HVIRA and its implementing regulations pending the entry of final judgments. The court based its preliminary injunction on a determination that Plaintiffs had established that (1) they probably would succeed under the foreign affairs doctrine and the Commerce Clause, and (2) enforcement of the statute would cause Plaintiffs irreparable harm. The district court did not reach Plaintiffs' other constitutional challenges to the statute.

The Commissioner appealed the district court's decision. We rejected Plaintiffs' Commerce Clause and foreign affairs doctrine challenges to the statute as a matter of law. Id. at 743, 751. However, we left the preliminary injunction in place "in order to give the district court an opportunity to consider whether Plaintiffs are likely to succeed on the merits" of their due process claims. Id. at 754.

On remand, the district court conducted further proceedings and ultimately held that the statute violates Plaintiffs' right to procedural due process by "mandating license suspension for non-performance of what may be impossible tasks without allowing for a meaningful hearing." Gerling Global Reins. Corp. of Am. v. Low, 186 F.Supp.2d 1099, 1113 (E.D.Cal.2001) (Gerling II). The court granted Plaintiffs' summary judgment motion, denied the Commissioner's summary judgment motion, and permanently enjoined the Commissioner from enforcing the statute. Id. The Commissioner filed a timely notice of appeal. Plaintiffs timely cross-appealed the district court's denial of their alternative grounds for summary judgment.

Plaintiffs moved for a determination that they were entitled to attorney fees as prevailing parties under 42 U.S.C. §§ 1983, 1988. The district court denied their motion, and Plaintiffs timely appealed that decision as well.

STANDARD OF REVIEW

We review de novo the district court's grant or denial of summary judgment. United States v. Alameda Gateway Ltd., 213 F.3d 1161, 1164 (9th Cir.2000). Viewing the evidence in the light most favorable to the non-moving party, we must determine whether there are any genuine issues of material fact and whether the district court properly applied the relevant substantive law. Id. We also review de novo the constitutionality of a statute. Dittman v. California, 191 F.3d 1020, 1024-25 (9th...