Liberty Ins. Underwriters Inc. v. Scudier

Decision Date08 July 2013
Docket NumberNo. 2:12–CV–1549 JCM (VCF).,2:12–CV–1549 JCM (VCF).
Citation53 F.Supp.3d 1308
PartiesLIBERTY INSURANCE UNDERWRITERS INC., Plaintiff(s), v. William SCUDIER, et al., Defendant(s).
CourtU.S. District Court — District of Nevada

53 F.Supp.3d 1308

LIBERTY INSURANCE UNDERWRITERS INC., Plaintiff(s),
v.
William SCUDIER, et al., Defendant(s).

No. 2:12–CV–1549 JCM (VCF).

United States District Court,
D. Nevada.

Signed July 8, 2013.


[53 F.Supp.3d 1311]


Jonathan W. Carlson, McCormick, Barstow, Sheppard, Wayte & Carruth, LLP, Las Vegas, NV, Patrick Fredette, Cincinnati, OH, for Plaintiff.

Cliff W. Marcek, Cliff W. Marcek, P.C., Las Vegas, NV, for Defendant.


ORDER

JAMES C. MAHAN, District Judge.

Presently before the court is plaintiff Liberty Insurance Underwriters Inc.'s motion for summary judgment. (Doc. # 20).1 Defendant Patrick Dillon responded (doc. # 32), and plaintiff replied (doc. # 33).

Also before the court is defendant Dillon's counter-motion to stay. (Doc. # 34). Plaintiff responded (doc. # 35), defendant Dillon replied (doc. # 36).

Last, before the court is plaintiff's motion for default judgment against defendant William Scudier. (Doc. # 27).2

I. Factual background

This action is an insurance coverage lawsuit seeking a declaration of non-coverage for William Scudier's (“Scudier”) intentional abuse and molestation of Patrick Dillon (“Dillon”). Scudier was employed as a

[53 F.Supp.3d 1312]

maintenance supervisor by Victory Village 2004, LLC (“Victory Village”) and B & R Property Management (“B & R”) (collectively “the association”). Dillon lived in the association and was 13 years old at the time of the abuse.

A. Underlying state action

In state court, Dillon filed a lawsuit against Scudier, Victory Village, and B & R for Scudier's intentional abuse and molestation of Dillon.3 Dillon's second amended complaint asserts the following causes of action: (1) battery against Scudier; (2) assault against Scudier; (3) intentional infliction of emotional distress against Scudier; (4) false imprisonment against Scudier; (5) negligent hiring against Victory Village and B & R; (6) negligent supervision against Victory Village and B & R; (7) negligent retention against Victory Village and B & R; (8) gross negligence against Victory Village and B & R; and (9) respondeat superior against Victory Village and B & R.4 (Doc. # 26, Ex. A).

The underlying complaint contains the following critical factual allegations supporting Dillon's claims for relief:

¶ 6 In October 2004, Patrick (“Dillon”) along with his mother Joann Dillon, and her boyfriend, Denver Lacey, moved into Apt. 627 at Victory Village.

¶ 7 Patrick was twelve (12) years old at this time.

¶ 14 Patrick began living with Scudier during January 2006.

¶ 16 In late-January 2006, Scudier performed oral sex on Patrick for the first time.

¶ 17 From January 2006 through August 2006, Scudier performed oral and anal sex on Patrick numerous times.

¶ 18 The frequency of the sexual contact varied from once a month to multiple times per week.

¶ 19 Patrick was thirteen (13) years old throughout the duration of the sexual relationship between he and Scudier.

¶ 23 On April 20, 2007, Scudier was charged with twenty-three (23) counts of Sexual Assault with a Minor Under Fourteen Years of Age, and twenty-three (23) counts of Lewdness with a Child Under the Age of 14.

¶ 24 On October 15, 2008, Scudier pled guilty to three counts of felony Coercion, pursuant to NRS §§ 207.190 and 175.547, stemming from his relationship with Patrick.

¶ 42 Scudier restrained Patrick within Scudier's apartment without legal justification or consent.

¶ 45 At some point in February 2006, Scudier took Patrick to the Fiesta Hotel and Casino in Henderson, Nevada.

¶ 46 At some point in June 2006, Scudier took Patrick to the Green Valley Ranch Resort, Spa & Casino in Henderson, Nevada.

¶ 47 At some point in June 2006, Scudier took Patrick to the Longhorn Hotel and Casino in Las Vegas, Nevada.

¶ 48 At some point in August 2006, Scudier took Patrick on a trip to Zion National Park in Utah.

¶ 50 Patrick could not reasonably have exited or escaped these premises, which were miles form his home.

(Doc. # 26, Ex. A).


B. Insurance policies

Liberty Insurance Underwriters Inc. (“plaintiff” or “Liberty”) issued two excess

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“follow-form” liability policies under which the association claims insured status. (Doc. # 24, Ex. A & B). The Liberty policies were specifically excess to underlying commercial general liability policies issued by Discovery Property and Casualty Insurance Company (“Discover”). (Doc. # 24, Ex. C; doc. # 26, Ex. E). The Liberty policies incorporate all policy language from the Discover policies, and thus follow form to the Discover policies, subject to the terms, conditions, exclusions and limitations of the Liberty policies.

The Liberty policies provide, in part:

We will pay on behalf of the Insured “loss” that results from an occurrence during the policy period.” We will pay “loss” in excess of the Underlying Insurance shown in Item 5 of the Declarations, but only up to an amount not exceeding our Limits of Liability as shown in Item 4 of Declarations. Except for any definitions, terms, conditions and exclusions of this policy, the coverage provided by this policy is subject to the terms and conditions of the First Underlying Insurance Policy, as shown in Item 5 of the Declarations.

(Doc. # 24, Exs. A & B, § I).


Scudier contends he is an insured under the Discover policies and thus, by definition, an “insured” under the Liberty policies and therefore is entitled to coverage under the policies for claims in the underlying action. ( See discussion infra, I.B.).

C. Instant action

Plaintiff filed the instant action seeking declaratory relief against Scudier and Dillon. (Doc. # 1). Scudier was timely served; however, Scudier failed to answer or otherwise respond. The court enters default judgment against Scudier ( see discussion infra, IV). Thus, Dillon is the only relevant defendant for purposes of the summary judgment motion.

Plaintiff seeks a declaration stating that Liberty has no duty to defend or indemnify Scudier in relation to the underlying state action. (Doc. # 1). Plaintiff now moves this court to enter judgment in its favor against Dillon and default judgment against Scudier. (Docs. # 21 & 27). Dillon has filed a counter-motion to stay this action pending resolution of an appeal in the underlying action. (Doc. # 34). The court addresses each motion in turn.

II. Motion for summary judgment (doc. # 20)A. Legal standard

The Federal Rules of Civil Procedure provide for summary adjudication when 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 movant is entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(a). A principal purpose of summary judgment is “to isolate and dispose of factually unsupported claims.” Celotex Corp. v. Catrett, 477 U.S. 317, 323–24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

In determining summary judgment, a court applies a burden-shifting analysis. “When the party moving for summary judgment would bear the burden of proof at trial, it must come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial. In such a case, the moving party has the initial burden of establishing the absence of a genuine issue of fact on each issue material to its case.” C.A.R. Transp. Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480 (9th Cir.2000) (citations omitted).

In contrast, when the nonmoving party bears the burden of proving the claim or defense, the moving party can meet its

[53 F.Supp.3d 1314]

burden in two ways: (1) by presenting evidence to negate an essential element of the nonmoving party's case; or (2) by demonstrating that the nonmoving party failed to make a showing sufficient to establish an element essential to that party's case on which that party will bear the burden of proof at trial. See Celotex Corp., 477 U.S. at 323–24, 106 S.Ct. 2548. If the moving party fails to meet its initial burden, summary judgment must be denied and the court need not consider the nonmoving party's evidence. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 159–60, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970).

If the moving party satisfies its initial burden, the burden then shifts to the opposing party to establish that a genuine issue of material fact exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). To establish the existence of a factual dispute, the opposing party need not establish a material issue of fact conclusively in its favor. It is sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 631 (9th Cir.1987).

In other words, the nonmoving party cannot avoid summary judgment by relying solely on conclusory allegations that are unsupported by factual data. See Taylor v. List, 880 F.2d 1040, 1045 (9th Cir.1989). Instead, the opposition must go beyond the assertions and allegations of the pleadings and set forth specific facts by producing competent evidence that shows a genuine issue for trial. See Celotex Corp., 477 U.S. at 324, 106 S.Ct. 2548.

B. Discussion

“An insurance policy is a contract.” Senteney v. Fire Ins. Exch., 101 Nev. 654, 655, 707 P.2d 1149 (1985). A court “should not rewrite contract provisions that are otherwise ambiguous.” Id. Summary judgment is appropriate when the contract terms are clear and unambiguous, even if the parties disagree as to their meaning. See United States v. King Features Entertainment, Inc., 843 F.2d 394, 398 (9th Cir.1988); see also Int'l Union of Bricklayers v. Martin Jaska, Inc., 752 F.2d 1401, 1406 (9th Cir.1985). Interpretation of the contract, including whether it is ambiguous, is a matter of law. Farmers Ins. Exchange v. Neal, 119 Nev. 62, 64, 64 P.3d 472 (2003); Beck Park Apts. v. United States Dep't of Housing, 695 F.2d 366, 369...

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