Café La Trova LLC v. Aspen Specialty Ins. Co.

• Decision Date: 16 February 2021
• Docket Number: Case No. 20-22055-CIV-Altonaga/Goodman
• Citation: 519 F.Supp.3d 1167
• Court: U.S. District Court — Southern District of Florida
• Parties: CAFÉ LA TROVA LLC, Plaintiff, v. ASPEN SPECIALTY INSURANCE COMPANY, Defendant.

519 F.Supp.3d 1167

CAFÉ LA TROVA LLC, Plaintiff,

v.ASPEN SPECIALTY INSURANCE COMPANY, Defendant.

Case No. 20-22055-CIV-Altonaga/Goodman

United States District Court, S.D. Florida.

Signed February 16, 2021

Mason Andrew Pertnoy, Krinzman, Huss, Lubetsky, Feldman & Hotte, Miami, FL, for Plaintiff.

Frederick Jay Fein, Eftihios Evan George Andronis, Clyde & Co US LLP, Miami, FL, Taylor Layne Davis, Clyde & Co, Atlanta, GA, for Defendant.

ORDER

CECILIA M. ALTONAGA, UNITED STATES DISTRICT JUDGE

THIS CAUSE is before the Court on Plaintiff, Café La Trova LLC's Motion for Summary Judgment ("Plaintiff's Motion") [ECF No. 30], filed on December 11, 2020; and Defendant, Aspen Specialty Insurance Company's Motion to Dismiss for Lack of Subject-Matter Jurisdiction, or in the Alternative, for Summary Judgment ("Defendant's Motion") [ECF No. 32], filed on December 15, 2020. Defendant filed a Response to Plaintiff's Motion [ECF No. 35], to which Plaintiff filed a Reply [ECF No. 46]. Plaintiff filed a Response to Defendant's Motion [ECF No. 48], to which Defendant filed a Reply [ECF No. 52]. The Court has carefully considered the Complaint (see [ECF No. 1-2] 4–10¹ ), the parties’ written submissions,² the record, and applicable law. For the following reasons, Plaintiff's Motion is denied, and Defendant's Motion is granted.

I. BACKGROUND

This declaratory judgment action involves an insurance coverage dispute regarding losses suffered by Plaintiff in connection with the ongoing COVID-19 pandemic. Plaintiff owns and operates a restaurant by the name of "Café La Trova." (Compl. ¶ 2; Def.’s SOF ¶ 1). Effective January 10, 2020 through January 10, 2021, Plaintiff purchased a commercial property insurance policy (the "Policy") from Defendant. (See Compl. ¶ 8; Pl.’s SOF ¶ 1; Def.’s SOF ¶ 17). The Policy identifies the insured property as the Café La Trova restaurant located at 971 S.W. 8th Street in Miami, Florida. (See Compl. ¶ 9; id. , Ex. A, Policy 27).

In the Building and Personal Property Coverage Form, the Policy states, in part, that Defendant "will pay for direct physical loss of or damage to" property covered by the Policy, resulting from any covered cause. (Policy 58). Under the Business Income (and Extra Expense) Coverage Form, the Policy further states Defendant "will pay for the actual loss of Business Income [the insured] sustain[s] due to the necessary ‘suspension’ of [the insured's] ‘operations’ during the ‘period of restoration[,]’ " provided such suspension is "caused by direct physical loss of or damage to" covered property resulting from a covered cause. (Id. 74 (alterations added)). Finally, the Civil Authority provision of the Policy provides coverage for the loss of business income "[w]hen a Covered Cause of Loss causes damage to property other than [the insured's covered] property" and, "in response to dangerous physical conditions resulting from th[at] damage" or covered cause, an action of civil authority "prohibits access" to the covered property. (Id. 75 (alterations added)).

Plaintiff asserts that as a direct result of the global COVID-19 pandemic and certain governmental orders that restricted restaurant operations in an effort to curb the spread of COVID-19, it lost use of the covered property "for its intended use and purpose[.]"³ (Pl.’s SOF ¶ 34 (alteration added); see also Compl. ¶ 22). Specifically, Plaintiff identifies an order issued by the City of Miami on March 17, 2020, which prohibited restaurants from serving patrons for in-person dining but permitted restaurants to offer food for delivery, carry-out, or drive-thru. (See Pl.’s SOF ¶ 32; Def.’s SOF ¶ 3). Plaintiff also identifies Emergency Order 07-20, issued by Miami-Dade County on March 19, 2020, which incorporated Emergency Order 03-20 and provided, in part, that restaurants had to close on-premises service to customers but could remain open for delivery, pick-up, or take-out services. (See Compl. ¶ 20; Def.’s SOF ¶¶ 4–5). Plaintiff ceased all operations on March 15, 2020. (See Compl. ¶ 21; Def.’s SOF ¶ 2).

As a result, Plaintiff alleges it "lost use of the Property, the restaurant and bar business was interrupted, and business income was lost." (Compl. ¶ 22). Plaintiff also contends it had to use chemicals to clean surfaces, move furniture, install partitions, and discard spoiled food; and that these actions caused damage to the property.⁴

(See Pl.’s SOF ¶¶ 36–38). Plaintiff submitted notice of its claim under the Policy to Defendant on March 23, 2020. (See Compl. ¶ 26; id. , Ex. B, Notice of Claim 98–99). On March 24, 2020, Defendant assigned Plaintiff a claim number. (See Compl. ¶ 28).

On March 31, 2020, Plaintiff filed this action against Defendant, seeking a declaration that its claim is fully covered by the Policy. (See generally Compl.). In particular, Plaintiff contends its losses are covered by the Building and Personal Property, Business Income, and Civil Authority coverages. (See generally Pl.’s Mot.). Defendant argues Plaintiff's losses are not covered by the Policy and, in any event, there is no justiciable controversy because Defendant did not deny or have time to investigate Plaintiff's claim before Plaintiff filed this suit against it. (See generally Def.’s Mot.). The parties’ competing motions ask the Court to determine (1) whether there is a justiciable controversy sufficient for the Court to exercise subject-matter jurisdiction, and (2) whether the business income losses Plaintiff incurred relating to the COVID-19 pandemic are covered by the Policy.

II. LEGAL STANDARDS

A. Motion to Dismiss for Lack of Subject-Matter Jurisdiction

Federal Rule of Civil Procedure 12(h)(3) provides that, if a court "determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action." Fed. R. Civ. P. 12(h)(3). Thus, the Court has "an independent obligation to determine whether subject-matter jurisdiction exists, even in the absence of a challenge from any party." Arbaugh v. Y & H Corp. , 546 U.S. 500, 514, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006) (citation omitted). Federal courts are courts of limited jurisdiction and "possess only that power authorized by [the] Constitution and statute[.]" Kokkonen v. Guardian Life Ins. Co. of Am. , 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994) (alterations added; citations omitted). It is therefore "presumed that a cause lies outside [the Court's] limited jurisdiction, and the burden of establishing the contrary rests upon the party asserting jurisdiction[.]" Id. (alterations added; citations omitted).

B. Motions for Summary Judgment

Summary judgment may only be rendered if the pleadings, discovery and disclosure materials on file, and any affidavits show there is no genuine issue as to any material fact and the movant is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(a), (c). An issue of fact is "material" if it might affect the outcome of the case under the governing law. See Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). It is "genuine" if the evidence could lead a reasonable jury to find for the non-moving party. See id. ; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The Court draws all reasonable inferences in favor of the party opposing summary judgment. See Chapman v. AI Transp. , 229 F.3d 1012, 1023 (11th Cir. 2000).

If the non-moving party bears the burden of proof at trial, the moving party may obtain summary judgment simply by: (1) establishing the nonexistence of a genuine issue of material fact as to any essential element of a non-moving party's claim, and (2) showing the Court there is insufficient evidence to support the non-moving party's case. See Blackhawk Yachting, LLC v. Tognum Am., Inc. , No. 12-14209-Civ, 2015 WL 11176299, at *2 (S.D. Fla. June 30, 2015) (citations omitted). "Once the moving party discharges its initial burden, a non-moving party who bears the burden of proof must cite to ... materials in the record or show that the materials cited do not establish the absence or presence of a genuine dispute." Id. (citing Fed. R. Civ. P. 56(c)(1) ; alteration added; quotation marks omitted).

"Summary judgment may be inappropriate even where the parties agree on the basic facts [ ] but disagree about the inferences that should be drawn from these facts." Whelan v. Royal Caribbean Cruises Ltd. , No. 1:12-cv-22481, 2013 WL 5583970, at *2 (S.D. Fla. Aug. 14, 2013) (alteration added; citation omitted). Where "reasonable minds might differ on the inferences arising from undisputed facts, then the Court should deny summary judgment" and proceed to trial. Id. (citations omitted).

When the parties file cross-motions for summary judgment, the standard of review "does not differ from the standard applied when one party files a motion, but simply requires a determination of whether either of the parties deserves judgment as a matter of law on the facts that are not disputed." GEBAM, Inc. v. Inv. Realty Series I, LLC , 15 F. Supp. 3d 1311, 1315–16 (N.D. Ga. 2013) (citing Am. Bankers Ins. Grp. v. United States , 408 F.3d 1328, 1331 (11th Cir. 2005) ); see also United States v. Oakley , 744 F.2d 1553, 1555 (11th Cir. 1984) ("Cross-motions ... will not, in themselves, warrant the court in granting summary judgment unless one of the parties is entitled to judgment as a matter of law on facts that are not genuinely disputed." (alteration added; citation omitted)).

III. ANALYSIS

A. Defendant's Motion to Dismiss

Defendant moves to dismiss this declaratory judgment action arguing the lack of a justiciable controversy deprives the Court of subject-matter jurisdiction. (See Def.’s Mot. 4–6). When, as here, a claim seeking relief under Florida's Declaratory Judgment Act is removed from state court to federal court, the Court construes such claim as an action for declaratory relief under the federal Declaratory Judgment Act, 28 U.S.C....