Northfield Ins. Co. v. Sandy's Place, LLC
| Decision Date | 31 March 2021 |
| Docket Number | No. 1:19-cv-00897-NONE-EPG,1:19-cv-00897-NONE-EPG |
| Citation | 530 F.Supp.3d 952 |
| Parties | NORTHFIELD INSURANCE COMPANY, an Iowa corporation, Plaintiff, v. SANDY'S PLACE, LLC, a California limited liability company, et al., Defendants. |
| Court | U.S. District Court — Eastern District of California |
Mark Dennis Peterson, Cates Peterson LLP, Newport Beach, CA, for Plaintiff.
Alyson Berg, James Hugh Wilkins, Wilkins Drolshagen & Czeshinski LLP, Fresno, CA, for Defendants Sandy's Place, LLC, Sandy G. Self, Olen Self.
Daniel L. Harralson, Daniel L. Harralson Law Corporation, Fresno, CA, for Defendant Rudy Gallegos, Jr.
ORDER GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
This is an insurance coverage dispute brought by plaintiff Northfield Insurance Company against defendants Sandy's Place LLC, Sandy G. Self, Olen Self, Monico Alejandrez, and Rudy Gallegos, Jr. (Doc. No. 1, Compl.) After a patron was shot multiple times outside of a bar called "Sandy's Place," the patron sued defendants in state court for his injuries. (Id. at ¶ 5.) At the time of the shooting, plaintiff insured defendant Sandy's Place LLC for bodily injury and property damage. (Id. at ¶ 4.) Plaintiff tendered a defense in the state-court action while reserving its right to deny coverage on the basis that the claims are excluded by a provision in the policy regarding assault and battery. (Id. at ¶ 6.) Currently pending before the court is plaintiff's motion for summary judgment, which seeks a declaratory ruling that it has no duty to defend the state-court action and equitable reimbursement of defense costs. (Doc. No. 24.) For the reasons set forth below, the motion for summary judgment will be granted in its entirety.
Plaintiff and defendants submitted their own separate statements of facts in support and in opposition to the pending motion for summary judgment. Plaintiff states that defendants Sandy's Place LLC, Sandy Self, and Olen Self refused to "stipulate to any of the proposed statement of undisputed facts" on the basis that minimal discovery has been conducted in this case, making the motion for summary judgment "premature and unfair." (Doc. No. 29 at 4.) The remaining two defendants, Monico Alejandrez (who appears to be an insured but is not represented in this case) and Rudy Gallegos (who is not an insured but is instead the plaintiff/victim in the state-court action), did not respond in substance to the request to stipulate to undisputed facts for the purposes of summary judgment. (Id. ) The following facts are drawn from both statements of undisputed facts and responses, and are supplemented by other evidence where appropriate.
The Fresno Police Department conducted an investigation into the shooting that took place at Sandy's Place in the early morning hours of November 25, 2018. (Doc. Nos. 33-1 (Defendants’ Statement of Facts and Plaintiff's Responses, "DSF") at ¶ 1; 31-3 at 48 (Law Enforcement Report).) Although the parties do not focus on the specifics of the shooting because they are not material to the pending motion, they are provided for context here. A security guard working at Sandy's Place when the shooting occurred provided the following description to law enforcement. (See Doc. No. 31-3 at 59.) Before the shooting, the shooter and another patron angrily left Sandy's Place with two open bottles of alcohol. (Id. ) Less than 30 minutes after they left, the shooter returned in a vehicle and engaged in a verbal dispute with security staff at Sandy's Place. (Id. ) As the verbal dispute continued, another patron (i.e. , the victim) "was standing nearby the doorway" and also engaged in a verbal dispute with the shooter. (Id. ) The shooter, who was still in the vehicle, held up a black handgun, said "Yeah what now?", and fired several rounds at the victim who was standing by the door of Sandy's Place. (Id. )
The following facts regarding the shooting are undisputed: after leaving Sandy's Place, the shooter returned about 19 minutes later in a white four-door sedan, (DSF at ¶¶ 2, 4); the shooter was not on the "premises" of Sandy's Place at the time he fired the gun, (id. at ¶ 3); and defendant Sandy's Place LLC did not have prior knowledge of or authorize the shooting, which was "completely unexpected" from its perspective, (id. at ¶¶ 5–7.)
At the time of the shooting, plaintiff insured defendant Sandy's Place LLC with a commercial policy covering general liability and property with an effective term running from April 1, 2018 to April 1, 2019 (the "Policy"). (Doc. Nos. 31-1 (Plaintiff's Statement of Facts and Defendants’ Responses, "PSF") at ¶ 1; see also 26-1 at 2 (copy of the Policy).) As relevant to the pending motion, the Policy covers bodily injury:
(PSF at ¶ 2; see also Doc. No. 26-1 at 20, 31, 33.)
The Policy contains two exclusions: the first for an assault or battery (the "Assault or Battery Exclusion") and the second for liquor liability (the "Liquor Liability Exclusion"). The Assault or Battery Exclusion states:
(PSF at ¶ 3 (); see also Doc. No. 26-1 at 20, 37.) Further, the Policy contains an original exclusion concerning liquor liability coverage, which states in relevant part:
(Doc. No. 26-1 at 20–21.) However, an amendment replaces the original exclusion above with the current Liquor Liability Exclusion:
(PSF at ¶ 4 (); Doc. No. 26-1 at 77.)
The victim of the shooting, Rudy Gallegos Jr. (a named defendant in this action), filed a lawsuit in state court against defendants Sandy Self, Olen Self, and Sandy's Place LLC asserting claims for general negligence and premises liability: Rudy Gallegos, Jr. v. Sandy G. Self, et al. , No. 19CECG00967 (Fresno County Superior Court) (the "Underlying Action"). (Doc. No. 26-5 at 3–9 (Underlying Action's Second Amended Complaint).) In March 2019, defendant Sandy's Place LLC tendered the original complaint in the Underlying Action to plaintiff for defense and indemnity. (PSF at ¶ 11.) The original complaint asserted claims for general negligence and premises liability against defendants Sandy Self, Olen Self, and Sandy's Place LLC, as well as an intentional tort claim against the shooter. (Doc. No. 26-2 at 2–11.) The allegations in the original complaint essentially contended that defendants could have taken additional steps to prevent the the shooting and sought to hold them liable for the victim's injuries. (See id. at 7–8; see also PSF at ¶ 12.) The next month, plaintiff responded to the tender offer by agreeing to defend defendants Sandy's Place, LLC, Sandy G. Self, and Monico Alejandrez in the Underlying Action, while reserving its rights to contest noncoverage and seek reimbursement of any costs associated with the defense. (PSF at ¶ 14; see also Doc. No. 26-3 (Reservation of Rights Letter).) Although defendant Sandy's Place LLC is the only named-insured, the parties agree that defendants Sandy Self, Olen Self, and Monico Alejandrez "arguably have the rights of persons insured" under...
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