Leader National Ins. Co. v. Shaw, CIV-94-662-A.

Decision Date28 June 1995
Docket NumberNo. CIV-94-662-A.,CIV-94-662-A.
Citation901 F. Supp. 316
PartiesLEADER NATIONAL INSURANCE COMPANY, Plaintiff, v. Bobby Austin SHAW, Personal representative of the Estate of Anthony Shaw, deceased; Bobby Austin Shaw, individually and as next of kin of Jessica Shaw, deceased; Estelle Shaw, individually and as next of kin of Jessica Shaw, deceased; Elia Herren, individually and as next of kin of Minnie Shaw and Jessica Shaw, each deceased; James Kearby; David Seely, individually and as parent and next friend of Allison Seely, Jeff Seely and J. Edward Seely, each a minor; Paul Gunkel, individually and as father and next friend of Lindsey Gunkel, a minor; Jeffrey Glenn; Group Health Service of Oklahoma, d/b/a Blue Cross and Blue Shield of Oklahoma; Baptist Medical Center of Oklahoma, Inc.; United States of America; Farmers Union Hospital Association, d/b/a Great Plains Regional Medical Center, Defendants. Tig Insurance Company, a California Corporation, and Earl L. Henderson Trucking Company, an Illinois Corporation, Third-Party Defendants.
CourtU.S. District Court — Western District of Oklahoma

Mark W. Albert, Albert & Albert, Elk City, OK, Gary F. Duckworth, Hugh A. Manning, Baker Baker & Tait, Oklahoma City, OK, and Ben T. Schmitt, Harris McCausland & Schmitt, Overland Park, KS, for Leader National Insurance Company.

Randy L. Bumgarner, Michael McNulty, Mark T. Koss, McNulty Koss & Bumgardner, Oklahoma City, OK, and John Sprowls, Pauls Valley, OK, for Bobby Austin Shaw.

Tom Cooper and Brett Agee, Garvin Agee Carlton & Mashburn, Pauls Valley, OK, for James Kearby.

G. Robinson Stratton, III and G. Scott Ray, Ray & Stratton, Oklahoma City, OK, for Elia Herron.

Mark W. Albert, Albert & Albert, Elk City, OK, for David Seely, Rebecca Seely, Allison Seely, Jeff Seely, J. Edward Seely.

David Seely, Elk City, OK, pro se.

Tim N. Cheek and John D. Cheek, Cheek Cheek & Cheek, Oklahoma City, OK, for Jeffery Glenn, Tig Ins. Co., and Earl L. Henderson Trucking Co.

John K. Williams, Williams Luttrell & Boren, Oklahoma City, OK, for Baptist Medical Center of Oklahoma Inc.

Emmanuel E. Edem, Norman Edem McNaughton & Wallace, Oklahoma City, OK, for Ana Herren, Special Administratrix of the Estate of Jessica Shaw, deceased and Minnie Shaw, deceased defendant.

Randy D. Witzke and Greg D. Givens, Edmonds Cole Hargrave Givens & Witzke, Oklahoma City, OK, for TTC Illinois Inc.


ALLEY, District Judge.

This matter comes before the Court on the Motion for Summary Judgment, filed by plaintiff, Leader National Insurance Company ("Leader National"), pursuant to Fed. R.Civ.P. 56(a). Defendants, Group Health Service of Oklahoma1, Elia Herren, Ana Herren2 and James Kearby, responded in opposition to the motion. Defendants Seely did not respond in opposition to the motion.3 For the reasons stated herein, the Court grants in part and denies in part plaintiff's motion.

The relevant facts of the motion for summary judgment in this interpleader action are largely undisputed.4 Leader National issued an automobile insurance policy ("the Policy") to Anthony and Minnie Shaw, covering the period of June 15, 1993 through September 15, 1993. The Policy was issued in Chapman, Kansas through Range Financial Services. On July 1, 1993, Anthony Shaw was involved in an accident while driving the insured car.

The July 1, 1993 accident occurred near Elk City, Oklahoma. For purposes of the instant motion, it will be assumed that the accident arose at least in part due to Anthony Shaw's negligence, resulting in the deaths of Anthony and Minnie Shaw and their infant daughter Jessica. James Kearby and Elia Herren were passengers in the Shaw vehicle and sustained substantial injury. The Policy provided for bodily injury coverage of $25,000/person and $50,000/accident. The Policy also provided for uninsured/underinsured motorist coverage of $25,000/person with a maximum of $50,000/accident. Pursuant to these provisions, plaintiff paid $100,000 into the Court registry.

Plaintiff alleges that Personal Injury Protection ("PIP") payments have been made to the Personal Representative of the Estate of Anthony Shaw, for Anthony, Minnie and Jessica Shaw. Defendant Ana Herren contests this fact, asserting that she is unaware that any such payment have been made. The remaining defendants have considered the issue and determined that they are ineligible for PIP benefits. In its Reply, plaintiff contends that Ana Herren has received notification of payment and raises no objection. The Court received no supporting documentation of such, and accordingly cannot consider this fact resolved for summary judgment purposes.

Defendant James Kearby is a domiciliary and resident of Oklahoma, as is Bobby Austin Shaw, personal representative of Anthony Shaw's estate. Elia and Ana Herren are residents of Texas. The parties agree that Anthony and Jessica Shaw were domiciled in Oklahoma at the time of the accident; however, they resided in Kansas. Defendants argue that Minnie Shaw was a domiciliary of Oklahoma, and plaintiff contends that Texas was her domicile. Mrs. Shaw resided in Kansas with her husband and child.

Plaintiff moves for judgment with regard to bodily injury liability, asserting that benefits have been paid to the policy limits.5 Leader National also seeks a declaration that it is not liable for uninsured/underinsured motorist coverage. Defendants challenge the motion, asserting that the issues presented are not ripe and therefore a decision on the motion should be stayed pending the outcome of the liability portion of the case. Defendants argue that summary judgment is inappropriate, as Oklahoma law applies and may dictate that uninsured/underinsured coverage exists under the Policy.

Summary judgment is appropriate if the pleadings and affidavits 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. Fed.R.Civ.P. 56(c). "A motion for summary judgment should be granted only when the moving party has established the absence of any genuine issue as to a material fact." Mustang Fuel Corp. v. Youngstown Sheet & Tube Co., 561 F.2d 202, 204 (10th Cir.1977). Any doubt as to the existence of a genuine issue of material fact must be resolved against the party seeking summary judgment. Board of Educ. v. Pico, 457 U.S. 853, 863, 102 S.Ct. 2799, 2806, 73 L.Ed.2d 435 (1982). In addition, the inferences drawn from the facts presented must be construed in the light most favorable to the nonmoving party. Nonetheless, a party opposing a motion for summary judgment may not simply allege that there are disputed issues of fact; rather, the party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). "There is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party. If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986) (citations omitted). The moving party is entitled to judgment as a matter of law when the nonmoving party "fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986).

The perplexing question in this case is whether underinsured coverage is payable at all. Under Oklahoma law underinsured coverage may be available to the claimants, under Kansas law such coverage is not. Whether Kansas or Oklahoma law applies is dependent on how the case got to this Court. Therefore, the outcome of plaintiff's motion depends largely on the procedural history of this case.

Plaintiff initially filed this action in the United States District Court for the District of Kansas. Asserting an action pursuant to 28 U.S.C. § 2361, plaintiff requested that the Court distribute the funds payable under the Shaws' policy to the legally entitled claimants. Defendants sought and received a change of venue to this Court. Defendants' motion for a change of venue was couched under 28 U.S.C. §§ 1404(a), 1406(a), 1335, and 1397. Plaintiff did not respond to the motion, resulting in confession and transfer of the case. Because plaintiff did not respond to the motion, no opinion was issued delineating the basis for transfer. As the statutory basis for transfer dictates the choice of law in the case, the Court must attempt to reconstruct the basis upon which the District Court of Kansas relied in transferring the case.

A federal change of venue may be effectuated pursuant to 28 U.S.C. § 1404 or § 1406. The statutory basis for the change is dependent on whether venue was proper in the original forum. Cases transferred between federal district courts pursuant to 28 U.S.C. § 1404(a), are transferred for the convenience of the parties and the witnesses. In such cases, venue is proper in both the transferor court and the transferee court. Following transfer pursuant to § 1404(a), the transferee court applies the substantive law of the transferor court. Chrysler Credit Corp. v. Country Chrysler, Inc., 928 F.2d 1509, 1516 (10th Cir.1991) (citing Ferens v. John Deere Co., 494 U.S. 516, 528-33, 110 S.Ct. 1274, 1282-84, 108 L.Ed.2d 443 (1990)).

28 U.S.C. § 1406(a) calls for transfer of a case where venue is improper in the transferor court. Under § 1406(a), the case is transferred to a forum where venue is proper and the law of the transferee court applies. Ellis v. Great Southwestern Corp., 646 F.2d 1099 (5th Cir.1981). On issues of federal law, the distinction between applying the law of the transferee or the transferor is almost irrelevant. Where jurisdiction is based on diversity of citizenship, however, the distinction is of utmost importance. This importance is magnified, where, as in ...

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