Craige v. Gov't Emps. Ins. Co., 1:19-cv-408
| Decision Date | 25 November 2020 |
| Docket Number | 1:19-cv-408 |
| Citation | 503 F.Supp.3d 365 |
| Court | U.S. District Court — Middle District of North Carolina |
| Parties | Tamika CRAIGE and Jeremiah Thomas, Plaintiffs, v. GOVERNMENT EMPLOYEES INSURANCE COMPANY and Nationwide Affinity Insurance Company of America, Defendants. |
C. Destine A. Couch, Couch & Associates, PC, Durham, NC, for Plaintiffs.
Michael S. Rothrock, Laura M. Forrest, Hedrick Gardner Kincheloe & Garofalo LLP, Raleigh, NC, for Defendant Government Employees Insurance Company.
Philip Alan Collins, Bailey & Dixon, LLP, Raleigh, NC, for Defendant Nationwide Affinity Insurance Company of America.
Before the court are cross-motions for summary judgment filed by Plaintiffs Tamika Craige and Jeremiah Thomas (Doc. 31) and Defendants Government Employees Insurance Company ("GEICO") (Doc. 42) and Nationwide Affinity Insurance Company of America ("Nationwide") (Doc. 44). Also before the court is Plaintiffs' motion to stay discovery pending ruling on Plaintiffs' motion for summary judgment. (Doc. 33.) The motions have been fully briefed, and the court heard argument on them on November 19, 2020. For the reasons set forth below, the court will deny Defendants' motions for summary judgment and grant Plaintiffs' motion for summary judgment. Plaintiffs' motion to stay discovery will be denied as moot.
The facts, either not in dispute or viewed in the light most favorable to the non-moving parties in the cross-motions for summary judgment, establish the following:1
On September 21, 2013, James Rigsbee ("Rigsbee"), age 45, was operating a vehicle in Durham, North Carolina, when he was stopped and issued a citation for having an expired registration and driving with his license revoked. (Doc. 23-3 at 1; Doc. 32-3 at 12.) The citation listed Rigsbee's address as 108 East Edgewood Drive, Durham, North Carolina. (Id. )
Later that day, Rigsbee was involved in a vehicular accident with Craige and Thomas, as well as others. (Doc. 32 at 2–3; Doc. 37 at 4; Doc. 38 at 2.) The vehicle Rigsbee drove at the time of the accident, a commercial vehicle owned by Shelby Wilson, was insured by Peak Property and Casualty Insurance Corporation ("Peak"). (Doc. 37 at 5; Doc. 38 at 2; Doc. 40 at 4.) The accident report listed Rigsbee's address as 2734 Weldon Terrace, Durham, NC. (Doc. 32-5 at 14.) As a result of the collision, Plaintiffs suffered bodily and mental injuries. (Doc. 14-3.)
At the time of the accident, Rigsbee's brother, Matthew Rigsbee ("M. Rigsbee"), was the named insured on Nationwide Auto Policy 6132C 642258 ("the Nationwide policy"). (Doc. 32 at 2; Doc. 38 at 2.) Rigsbee's mother, Mary Overby ("M. Overby") and stepfather, Asa Overby ("A. Overby"), were the named insureds on GEICO Auto Policy 4259-30-93-85 ("the GEICO policy"). (Doc. 32 at 2; Doc. 37 at 2.) Under both the Nationwide and GEICO policies, M. Rigsbee, M. Overby, and A. Overby (collectively "the named insureds") were listed as residing at 108 East Edgewood Drive in Durham, NC. (Doc. 32 at 2; Doc. 37 at 2; Doc. 38 at 2.)
As a result of the accident, Rigsbee was charged with multiple offenses, including driving left of center, driving while license revoked, expired registration, and driving while subject to an impairing substance. (Doc. 14-3 ¶ 9.) On October 29, 2013, Rigsbee completed an affidavit of indigency and listed his address as 108 East Edgewood Drive, Durham, North Carolina. (Doc. 23-3 at 3.) On November 22, 2013, Rigsbee was issued an identification card from the North Carolina Division of Motor Vehicles that listed his address as 108 East Edgewood Drive, Durham, North Carolina. (Doc. 32-3 at 3.)
As early as December 2, 2014, Plaintiffs' counsel informed Nationwide that they were seeking coverage under the Nationwide policy for the injuries stemming from Rigsbee's accident. (Doc. 38-7 ¶ 4.) Sometime before March 2, 2015, Plaintiffs' counsel also contacted GEICO and informed it of the claim against Rigsbee. (Doc. 32-2; see also Doc. 32-3.) After that time, Defendants each undertook independent investigations of the claim and determined Rigsbee was not a covered insured under their respective policies. (See Docs. 37-2, 38-7.)
On June 2, 2016, Plaintiffs filed a complaint in North Carolina state court against Rigsbee, Wilson, and Wilson's company, Tasty Haven, LLC, seeking damages arising out of the accident. (Doc. 32-5.) On November 14, 2016, Peak filed a motion to intervene in the lawsuit "to defend th[e] action in the name of its insured, Defendant James Arthur Rigsbee." (Doc. 38-2.) On March 31, 2017, Nationwide and GEICO were served with copies of the underlying complaint and summonses. (Doc. 32-10.) Both Nationwide and GEICO denied coverage and did not defend Rigsbee in the underlying suit. (Doc. 32 at 4; Doc. 37 at 7; Doc. 38 at 6.) A trial was held in Durham County Superior Court during the week of June 11, 2018. (Doc. 14-3.) That same week, the court granted Peak's motion to be relieved from Rigsbee's defense based on Peak having paid its per-accident limit to the relevant claimants, thus fulfilling its obligation to Rigsbee. (Docs. 40-2, 40-3.) As such, Peak did not defend Rigsbee in the trial and ultimately Rigsbee did not appear at the trial. (Doc. 14-3.) On June 13, 2018, after trial, the court found in favor of Plaintiffs and awarded Craige $206,750 and Thomas $61,500 in compensatory and punitive damages against Rigsbee. (Id. at 4.)
On March 14, 2019, Plaintiffs filed the present declaratory judgment action in North Carolina state court. (Doc. 1-1.) On April 16, 2019, Defendants removed the matter to this court. (Doc. 1.) On March 26, 2020, Plaintiffs moved for summary judgment (Doc. 31) and to stay discovery pending ruling on that motion (Doc. 33). Defendants timely responded in opposition (Docs. 37, 38), and Plaintiffs filed replies (Docs. 40, 41). On May 20 and 21, 2020, GEICO and Nationwide moved for summary judgment, respectively. (Docs. 42, 44.) Those motions are fully briefed. (Docs. 47, 48, 49, 50.) All motions are ready for resolution.
This court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332(a)(1). In a diversity case, a district court will apply the conflict of laws rules of the forum state. Klaxon v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496–97, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). North Carolina statutory law specifies that any policy insuring interests in North Carolina "shall be deemed" to have been made in and subject to the laws of North Carolina. N.C. Gen. Stat. § 58–3–1 ; see also Fortune Ins. Co. v. Owens, 132 N.C.App. 489, 512 S.E.2d 487, 489 (1999). Therefore, North Carolina insurance law and contract interpretation principles will be applied to the present matter.
A court must grant a motion for summary judgment if the pleadings, depositions, and affidavits submitted show that there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). A fact is considered "material" if it "might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Under this standard, a genuine dispute of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. As a result, the court will only enter summary judgment in favor of the moving party when the record "shows a right to judgment with such clarity as to leave no room for controversy" and clearly demonstrates that the non-moving party "cannot prevail under any circumstances." Campbell v. Hewitt, Coleman & Assocs., Inc., 21 F.3d 52, 55 (4th Cir. 1994) (internal quotation marks omitted). While the movant bears the initial burden of demonstrating that there are no genuine disputes of material fact, once that burden has been met, the non-moving party must demonstrate that a genuine dispute of material fact actually exists. Bouchat v. Balt. Ravens Football Club, Inc., 346 F.3d 514, 521 (4th Cir. 2003) ; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586–87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). A mere scintilla of evidence is insufficient to circumvent summary judgment. Anderson, 477 U.S. at 252, 106 S.Ct. 2505. Instead, the nonmoving party must convince the court that, upon the record taken as a whole, a rational trier of fact could find for the nonmoving party. Id. at 248–49, 106 S.Ct. 2505. Trial is unnecessary if "the facts are undisputed, or if disputed, the dispute is of no consequence to the dispositive question." Mitchell v. Data Gen. Corp., 12 F.3d 1310, 1315–16 (4th Cir. 1993).
In this case, the parties have filed cross-motions for summary judgment. Therefore, the court must review each motion separately to determine whether either party deserves judgment as a matter of law. Fed. R. Civ. P. 56(c) ; Rossignol v. Voorhaar, 316 F.3d 516, 523 (4th Cir. 2003) (quoting Philip Morris, Inc. v. Harshbarger, 122 F.3d 58, 62 n.4 (1st Cir. 1997) ). When considering each individual motion, the court must take care to "resolve all factual disputes and any competing, rational inferences in the light most favorable" to the party opposing the motion. Rossignol, 316 F.3d at 523 (quoting Wightman v. Springfield Terminal Ry. Co., 100 F.3d 228, 230 (1st Cir. 1996) ).
As a federal court sitting in diversity and applying North Carolina law, this court is obliged to apply the jurisprudence of North Carolina's highest court, the Supreme Court of North Carolina. See Private Mortg. Inv. Servs., Inc. v. Hotel & Club Assocs., Inc., 296 F.3d 308, 312 (4th Cir. 2002). When that court has not spoken directly on an issue, this court must "predict how that court would rule if presented with the issue." Id. The decisions of the North Carolina Court of Appeals are the "next best indicia" of what North Carolina's law is, though its decisions "may be...
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