Cincinnati Ins. Co. v. Dievernich, Case No. 4:18-cv-00492-KGB
| Decision Date | 06 September 2019 |
| Docket Number | Case No. 4:18-cv-00492-KGB |
| Parties | CINCINNATI INSURANCE COMPANY PLAINTIFF v. ANDREA DIEVERNICH, et al., DEFENDANTS |
| Court | U.S. District Court — Eastern District of Arkansas |
Before the Court are plaintiff Cincinnati Insurance Company's ("Cincinnati") motions to deposit interpleader funds, motion for default judgment, motions to extend time for service, and motion for retroactive leave to file reply (Dkt. Nos. 6, 12, 47, 53, 60, 75). Also pending before the Court are motions to dismiss filed by various defendants (Dkt. Nos. 22, 25, 29, 49). Finally, the Court has before it a motion to strike filed by Mark Allen, Sr., Montreal Allen, Andrew Bagley, Collin Bagley, Cheryl Dixon, Chiniya Ellis, Chester Harrell, Katrine Harrell, Demontae Oliver, Philemon Oliver, Gian Roberts, Trina Roberts, Kylan Terry, Breuna Womack, Earnest Womack, D'Andreya Devay Young, and D'Andreya Young (collectively, the "Allen defendants"), as well as by Kobe Simpson, Keisha Simpson, Earnest Simpson III (collectively, the "Simpson defendants") (Dkt. No. 56).
For the reasons discussed below, the Court grants the following motions filed by Cincinnati: the second motions to deposit interpleader funds, the motions to extend time for service, and the motion for retroactive leave to file reply (Dkt. Nos. 12, 47, 53, 60, 75). The Court also grants defendants' requests for a change of venue. Further, the Court refers Cincinnati's motion for default judgment to the Clerk of Court to determine if entry of default is appropriate under Rule 55(a) of the Federal Rules of Civil Procedures (Dkt. No. 47).
The Court denies as moot the first motion to deposit interpleader funds (Dkt. No. 6). The Court also denies the motions to dismiss filed by various defendants (Dkt. Nos. 22, 25, 29, 49). Finally, the Court also denies the motion to strike filed by the Allen defendants (Dkt. No. 56).
The following facts are taken from Cincinnati's amended complaint (Dkt. No. 2). According to its amended complaint, Cincinnati brings this interpleader action as the result of a November 10, 2017, automobile accident that involved three Helena-West Helena School District buses (Dkt. No. 2, ¶ 119). The defendants include drivers and passengers on the school bus, adjacent vehicles, and entities alleged to have provided medical treatment because of the accident (Id.). Cincinnati alleges that all passengers of the buses may have claims for injuries resulting from the accident (Id., ¶ 120).
Cincinnati alleges that it issued a policy of insurance ("Policy") to the Helena-West Helena School District with a $100,000.00 liability limits for a policy period of July 1, 2017, through July 1, 2018 (Id., ¶ 122). Cincinnati further alleges that the potential damages claimed and incurred by defendants "will likely exceed available coverage." (Id., ¶ 123). Because Cincinnati concedes that it owes defendants $100,000.00 in coverage but also concedes that it is unable to allocate those available funds among defendants, Cincinnati seeks to deposit $100,000.00 into the registry of the Court to "avoid being vexed and harassed by conflicting and multiple claims." (Id., ¶¶ 124, 129). Cincinnati also seeks an award of attorneys' fees and costs incurred for this interpleader action (Id., ¶ 130).
Given the number of parties and pending motions in this case, the Court will briefly recount the procedural history of this action.
Cincinnati filed its original complaint in interpleader on July 27, 2018, and subsequently filed an amended complaint in interpleader on August 10, 2018 (Dkt. Nos. 1, 2). The amended complaint names 113 individuals and entities as defendants, not counting the guardians of the minor defendants (Dkt. No. 2, ¶¶ 2-114). Cincinnati filed two motions to deposit funds (Dkt. Nos. 6, 12). Separate defendants Kylaun Anderson, Sandra Anderson, Marvie Askew-Evans, Donna Block, Keyon Burrell, Bakarius Collier, Maxine Ellison, Tasheta Evans, Carl Ford, Jr, Cynthia Ford, Kylar Gamble, Jaylon Gates, Torri Gates, Bobbie Randle, and Jordan Walker (collectively the "Anderson defendants") responded to the motion to deposit interpleader funds (Dkt. No. 14). Cincinnati filed a reply in support of their motions to deposit interpleader funds (Dkt. No. 26). Later, separate defendant Phillips Hospital Corporation d/b/a Helena Regional Medical Center ("Helena Regional") also filed a response to Cincinnati's motions to deposit interpleader funds (Dkt. No. 42).
Separate defendants Kobe Simpson, Keisha Simpson, and Earnest Simpson III filed an answer, objection, and motion to dismiss in response to plaintiff's first amended complaint in interpleader (Dkt. No. 22). In their filing, the Simpson defendants argue that this Court lacks subject matter jurisdiction because there is no diversity of citizenship between the proper parties to the action, that the Western Division of the Eastern District of Arkansas is the incorrect venue, and that Cincinnati does not "propose to pay the total funds available to the various Defendants from Plaintiff's policies of insurance," claiming the Simpson defendants believe Cincinnati's exposure to be at least $300,000.00 (Dkt. No. 22, at 5-6). The Allen defendants also filed an answer, objection, and motion to dismiss plaintiff's first amended complaint in interpleader, raising similar arguments (Dkt. No. 25). Furthermore, Tangela King, Taylin King, Kyron Smith, and Gloria Spencer (collectively, the "King defendants") filed a motion to dismiss, objection, andanswer raising similar arguments (Dkt. No. 29). Finally, Debbie Oliver and John Oliver filed an answer with an attached brief that seeks dismissal of the amended complaint on the same grounds raised by the other defendants (Dkt. No. 49). Cincinnati responded in opposition to each of these filings (Dkt. Nos. 31, 33, 35, 51).
On October 12, 2018, Cincinnati filed a motion for default judgment (Dkt. No. 47). In that motion, Cincinnati identified 39 defendants who Cincinnati contends were timely served and did not timely answer (Id., at 1-8). Accordingly, Cincinnati in its motion for default judgment seeks an order from this Court discharging it from any further liability to any of the defaulting defendants and a permanent injunction prohibiting the defaulting defendants from instituting any proceedings against Cincinnati regarding the accident at issue (Dkt. No. 48, at 2).
On October 24, 2018, Cincinnati also filed a motion to extend time for service (Dkt. No. 53). In that motion, Cincinnati asserted that 28 defendants remained to be served and that there was good cause for the Court to extend the time for service until January 25, 2019 (Dkt. No. 53). The Allen defendants responded in opposition to the motion to extend the time for service, and Cincinnati replied (Dkt. Nos. 54, 55). The Allen defendants then filed a motion to strike Cincinnati's reply, to which Cincinnati responded (Dkt. Nos. 56, 58). Cincinnati then filed a motion for retroactive leave to file reply, and the Allen defendants responded in opposition to that motion (Dkt. Nos. 60, 65). Finally, on January 1, 2019, Cincinnati filed a second motion to extend time for service, this time requesting an extension until March 11, 2019 (Dkt. No. 75). The Allen and Simpson defendants responded in opposition to the second motion to extend time for service (Dkt. No. 79).
First, the Court concludes that it has subject matter jurisdiction over this action. Second, the Court declines to rule on the terms of the Policy at this stage of the litigation. Third, pursuant to Federal Rule of Civil Procedure 22, the Court grants Cincinnati permission to deposit $100,000.00 into the registry of the Court. Fourth, the Court refers Cincinnati's motion for default judgment to the Clerk to determine whether entry of default is appropriate under Rule 55(a) of the Federal Rules of Civil Procedure. Fifth, the Court grants defendants' request to change venue. Sixth, and finally, the Court grants Cincinnati's motion for retroactive leave to file reply, denies the Allen defendants' motion to strike, and grants Cincinnati's motions to extend time to obtain service on defendants.
Several defendants have challenged whether the Court has subject-matter jurisdiction to decide this action. Those defendants argue that "[m]inimal diversity was created by the non-diverse Plaintiff by adding improper parties, alleged creditors of the various individual claimants." (Dkt. Nos. 22, ¶ 7; 25, ¶ 7; 29, ¶ 8; 49-1, ¶ 1). Additionally, Mr. and Ms. Oliver filed a brief in which they cited 28 U.S.C. § 1332(c)(1), presumably to argue that Cincinnati is a citizen of Arkansas, and therefore non-diverse (Dkt. No. 49-1, at 1).
Defendants' arguments raise two points: (1) that minimal diversity, which is required for statutory interpleader under 28 U.S.C. § 1335, does not exist; and (2) that complete diversity, which is required for diversity jurisdiction under 28 U.S.C. § 1332, does not exist. The first argument is moot, as Cincinnati has conceded that it is not proceeding under statutory interpleader. Instead, Cincinnati states that it only seeks interpleader under Rule 22 of the Federal Rules of Civil Procedure. Jurisdiction for Rule 22 interpleader actions "must be based upon the generaljurisdiction statutes applicable to civil actions in the federal courts." St. Louis Union Trust Co. v. Stone, 570 F.2d 833, 835 (8th Cir. 1978); see Arnold v. KJD Real Estate, LLC, 752 F.3d 700, 704 (7th Cir. 2014) (citing Alan Wright, et al., Fed. Prac. & Proc. Civ. § 1710 (3d ed.)).
Cincinnati does not assert federal question jurisdiction; thus, the Court looks to whether it has diversity jurisdiction over this matter. A complaint may be filed in federal court if there is complete diversity between the parties and the amount in controversy exceeds $75,000.00, exclusive of interest and costs. 28 U.S.C. § 1332(...
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