755 F.Supp. 1451 (W.D.Mo. 1991), 86-0422-CV-W-9, Omaha Indem. Co. v. Royal American Managers, Inc.

Docket Nº:86-0422-CV-W-9.
Citation:755 F.Supp. 1451
Party Name:The OMAHA INDEMNITY COMPANY, et al., Plaintiffs, v. ROYAL AMERICAN MANAGERS, INC., et al., Defendants.
Case Date:January 04, 1991
Court:United States District Courts, 8th Circuit, Western District of Missouri
 
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Page 1451

755 F.Supp. 1451 (W.D.Mo. 1991)

The OMAHA INDEMNITY COMPANY, et al., Plaintiffs,

v.

ROYAL AMERICAN MANAGERS, INC., et al., Defendants.

No. 86-0422-CV-W-9.

United States District Court, W.D. Missouri, Western Division.

Jan. 4, 1991

Page 1452

[Copyrighted Material Omitted]

Page 1453

Joe Rebein, Shook, Hardy & Bacon, Kansas City, Mo., Sheila J. Carpenter, Francis M. Gregory, Jr., Sutherland, Asbill & Brennan, Washington D.C., John W. Bonds, Jr., Carey DeDeyn, J.D. Fleming, Jr., Sutherland, Asbill & Brennan, Atlanta, Ga., for plaintiffs.

Byron Neal Fox, Robert L. Wehrman, Polsinelli, White, Vardeman & Shalton, Kansas City, Mo., James M. Kaplan, Wilson, Elser, Moskowitz, Edelman & Dicker, New York City, Oscar B. Goodman, Goodman, Stein & Chesnoff, Las Vegas, Nev., John L. Hayob, Kevin E. Glynn, Niewald, Waldeck, Norris & Brown, Robert W. Cotter, Dysart, Taylor, Penner, Lay & Lewandowski, P.C., Thomas O. Baker, Baker & Sterchi, Kansas City Mo., Robert A. Calinoff, Calinoff & Katz, New York City, Jonathanan

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  1. Margolies, McDowell, Rice & Smith, Max W. Foust, Foust, Strother & Frickleton, Duke W. Ponick, Jr., Ponick, Amick & Allen, Kansas City, Mo., James R. Bell, Murane & Bostwick, Casper, Wyo., for defendants.

Robert B. Best, Watson, Ess, Marshall & Enggas, Kansas City, Mo., pro se.

Laramie Ins. Co., Casper, Wyo., pro se.

Steven Hurley Mustoe, McDowell, Rice & Smith, Kansas City, Mo., for garnishee.

ORDER GRANTING PARTIAL SUMMARY JUDGMENT AGAINST JAMES R. WINING, WILLIE A. SCHONACHER, JR., FIELDING REINSURANCE, LTD. AND KENSU HOLDINGS, INC.

BARTLETT, District Judge.

I. Background

On April 3, 1986, Mutual of Omaha (Mutual) and The Omaha Indemnity Company (Omaha Indemnity) began this litigation against Royal American Managers, Inc. (RAM), James R. Wining (Wining), Willie A. Schonacher, Jr. (Schonacher), Fielding Reinsurance, Ltd. (Fielding), Kensu Holding, Inc. (Kensu) and other affiliated entities. Plaintiffs' claims arose from a managing general agency relationship between RAM and Omaha Indemnity in which RAM wrote reinsurance business in Omaha Indemnity's name. Claims for breach of contract, breach of fiduciary duty, negligence, fraudulent misrepresentation, prima facie tort, civil conspiracy and equitable relief were asserted.

On May 23, 1986, counsel for defendants moved to compel arbitration of all the claims against RAM and for a stay of all litigation against the defendants during the pendency of the arbitration proceeding asserting that "the claims against RAM and the claims against the Moving Defendants involve common fact issues which may be resolved in the arbitration." Memorandum in Support of Motion to Dismiss or, in the Alternative, to Stay Litigation at 27.

All claims against RAM in Omaha Indemnity's original Complaint were submitted to arbitration. On May 11, 1989, the arbitration panel returned an award of $225,000,000 in favor of Omaha Indemnity and against RAM. I confirmed this arbitration award and entered final judgment against RAM on July 7, 1989. RAM has paid nothing toward satisfaction of this judgment but Omaha Indemnity has been able to recover $5,000,000 from an errors and omissions insurer.

On November 17, 1989, plaintiffs filed a Third Amended Complaint. In Count V, plaintiffs assert that Wining and Schonacher are liable for the RAM arbitration judgment because they are privies of RAM and are bound by the judgment entered against RAM under principles of res judicata. In Count VI, plaintiffs assert that Wining, Schonacher, Fielding and Kensu, as well as others, aided and abetted breaches of fiduciary duty. Plaintiffs assert a conspiracy claim against RAM, Wining, Schonacher, Fielding, Kensu and other related entities in Count IX.

On April 13, 1990, plaintiffs moved for summary judgment against Wining and Schonacher on Count V of their Third Amended Complaint. On June 15, 1990, plaintiffs moved for summary judgment against Fielding and Kensu.

II. Standard for Summary Judgment

Rule 56(c), Federal Rules of Civil Procedure, provides that summary judgment shall be rendered if the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." In ruling on a motion for summary judgment, it is the court's obligation to view the facts in the light most favorable to the adverse party and to allow the adverse party the benefit of all reasonable inferences to be drawn from the evidence. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970); Inland Oil and Transport Co. v. United States, 600 F.2d 725, 727-28 (8th Cir.), cert. denied, 444 U.S. 991, 100 S.Ct. 522, 62 L.Ed.2d 420 (1979).

If there is no genuine issue about any material fact, summary judgment is proper because it avoids needless and costly litigation and promotes judicial efficiency.

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Roberts v. Browning, 610 F.2d 528, 531 (8th Cir. 1979); United States v. Porter, 581 F.2d 698, 703 (8th Cir. 1978). The summary judgment procedure is not a "disfavored procedural shortcut." Rather, it is "an integral part of the Federal Rules as a whole." Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 2555, 91 L.Ed.2d 265 (1986); see also City of Mt. Pleasant v. Associated Electric Cooperative, Inc., 838 F.2d 268, 273 (8th Cir. 1988). Summary judgment is appropriate against a party who fails to make a showing sufficient to establish that there is a genuine issue for trial about an element essential to that party's case, and on which that party will bear the burden of proof at trial. Celotex, 106 S.Ct. at 2553.

The moving party bears the initial burden of demonstrating by reference to portions of pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, if any, the absence of genuine issues of material fact. However, the moving party is not required to support its motion with affidavits or other similar materials negating the opponent's claim. Id. (emphasis added).

The nonmoving party is then required to go beyond the pleadings and by affidavits, depositions, answers to interrogatories and admissions on file, designate specific facts showing...

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