Porto Pavino, LLC. v. Legacy Cold Storage, LLC

• Court: U.S. District Court — District of New Jersey
• Writing for the Court: Hon. Joseph H. Rodriguez, UNITED STATES DISTRICT JUDGE
• Citation: Porto Pavino, LLC. v. Legacy Cold Storage, LLC, 447 F.Supp.3d 182 (D. N.J. 2020)
• Decision Date: 18 March 2020
• Docket Number: Civil Action No. 18-14596
• Parties: PORTO PAVINO, LLC., Plaintiff, v. LEGACY COLD STORAGE, LLC, et al. Defendants.

447 F.Supp.3d 182

PORTO PAVINO, LLC., Plaintiff,

v.LEGACY COLD STORAGE, LLC, et al. Defendants.

Civil Action No. 18-14596

United States District Court, D. New Jersey.

Signed March 18, 2020

Stephen J. Galati, Mattioni, Ltd, Swedesboro, NJ, for Plaintiff

Carmelo T. Torraca, Cooper, Levenson, April, Niedelman & Wagenheim, PA, Atlantic City, NJ, Dante B. Parenti, Hoffman Dimuzio, Franklinville, NJ, for Defendants.

Hon. Joseph H. Rodriguez, UNITED STATES DISTRICT JUDGE

This matter comes before the Court on Motion to Dismiss Plaintiff's Claim for Punitive Damages by Third Party Defendant Ohio Security Insurance Company ("Ohio Security") [Dkt. No. 30], improperly designated as Liberty Mutual Insurance Company, and Third Party Defendant Ohio Security's Motion for Partial Summary Judgment [Dkt. No. 46]. The Court has considered the parties' written submissions pursuant to Fed. R. Civ. P. 78 (b). For the reasons stated below, the Court will grant in part and deny in part Ohio Security's Motion for Partial Summary Judgment [Dkt. No. 46], and grant Ohio Security's Motion to Dismiss [Dkt. No. 30].

I. Background

Plaintiff, Porto Pavino, LLC ("Plaintiff" or "Porto Pavino"), "engages in the business of purchasing and selling food products, including fresh fruit, produce, chestnuts, among other products." [Dkt. No. 16 ¶ 2]. Defendants, Legacy Cold Storage, BK Trucking Co., Inc., and Brian Kargman (collectively "Warehouse Defendants" or "Legacy"), owned and operated a cold storage warehouse in Vineland, New Jersey [Id. at ¶ 16; Dkt. No. 13 ¶ 16] where Plaintiff stored certain quantities of its products [Dkt. No. 13 ¶ 17].

Legacy's insurance broker, Defendant Worldwide Insurance Associates, LLC ("Worldwide") obtained an insurance policy for Legacy from Third Party Defendant Ohio Security, a subsidiary of Liberty Mutual. [Dkt. No. 16 ¶¶ 14-17]. Ohio Security admits that it "issued commercial general liability and commercial property insurance coverage to named insured Legacy Cold Storage under policy no. BKS 18 58 32 77 81 for the period September 7, 2017 to September 7, 2018." [Dkt. No. 46-2 ¶ 15]. This policy covered the Vineland location where Plaintiff's goods were stored during the policy period. [Dkt. No. 16 ¶¶ 14-17]. Worldwide issued a Certificate of Liability Insurance to Plaintiff, informing the Plaintiff that this policy was in place. [Dkt. No. 51-5, Ex. A].

Plaintiff currently claims that it "delivered goods to Legacy to store at its warehouse and the goods were not returned to Porto Pavino or its order in the same like good order and condition." [Dkt. No. 26 ¶ 28; Dkt. No. 46-4, Ex. A]. Plaintiff retained a consultant to investigate the damages to its goods. According to the consultant, HDMI Marine, Plaintiff's fruit was in fact stored by Legacy, where it was damaged due to "prolonged exposure to sub-freezing temperature." [Dkt. No. 46-5, Ex. B, HDI Marine Report at 2-3]. Plaintiff submitted a claim for these losses to Legacy by letter dated July 18, 2018, demanding payment for Legacy's "improper storage and care of Porto Pavino's fresh fruit." (Id. ).

Legacy reported Plaintiff's claim to Ohio Security. On August 21, 2018, Ohio Security advised Legacy that its policy would not cover the liability. According to Ohio Security, the "care, custody or control" exclusion precluded coverage of "Porto Pavino's claim that Legacy Cold Storage is responsible for damage to Porto Pavino's fresh fruit caused by ... improper storage and handling of that fruit at Legacy Cold Storage warehouse." (Id. at ¶ 19); [Dkt. No. 46-7, Ex. D].

On October 3, 2018, Plaintiff filed a Complaint against the Warehouse Defendants alleging inter alia that, during storage, they failed "to safeguard and/or account for all of Plaintiff's goods, resulting in the loss or destruction of the goods and failure to redeliver to Plaintiff the same amount of goods as was delivered to Warehouse Defendants, causing Plaintiff financial loss." [Dkt. No. 1 ¶ 24]. Plaintiff also brought claims against Worldwide alleging that Worldwide failed to secure proper or customary liability coverage for Legacy. [Dkt. No. 1, Counts VII, VIII, IX]. Legacy answered Plaintiff's complaint and initiated a Third Party Complaint against Ohio Security for defense and indemnity under its CGL policy [Dkt. No. 13], as well as a crossclaim against Worldwide. [Dkt. No. 17, Cross Claim].

Plaintiff subsequently filed a Crossclaim/Third Party Claim against Ohio Security for first party coverage under the CGL policy (COUNT I), and third-party coverage (COUNT II), requesting punitive damages. [Dkt. No. 16]. The Third Party Complaint alleges that Porto Pavino was an additional insured under the CGL policy, which covered Porto Pavino's property. (Id. at ¶¶ 18-21). According to Plaintiff, no exclusions warranted a denial of coverage. (Id. at ¶ 30). Plaintiff's Count II in particular, seeks declaration that Ohio Security is obligated to pay Porto Pavino for all sums Legacy becomes liable for. (Id. ) Additionally, Count II seeks a declaration that Ohio Security acted in bad faith by denying third-party coverage. (Id. ).

Initially, Ohio Security filed a Motion to Dismiss Plaintiff's claim for punitive damages. [Dkt. No. 30]. It subsequently filed a Motion for Partial Summary Judgment against both Plaintiff and Legacy [Dkt. No. 46] seeking dismissal of claims for liability coverage as well as Porto Pavino's claims for bad faith. The summary judgment motion will inform the Court's analysis of the Motion to Dismiss, therefore, the Court will address the Motion for Partial Summary Judgment first.

II. Partial Summary Judgment Motion

A. Summary Judgment Standard

A court will grant a motion for summary judgment if there is no genuine issue of material fact and if, viewing the facts in the light most favorable to the nonmoving party, the moving party is entitled to judgment as a matter of law. Pearson v. Component Tech. Corp., 247 F.3d 471, 482 n.1 (3d Cir. 2001) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ); accord Fed. R. Civ. P. 56 (c). Thus, this Court will enter summary judgment only 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 moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56 (c).

An issue is "genuine" if supported by evidence such that a reasonable jury could return a verdict in the nonmoving party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A fact is "material" if, under the governing substantive law, a dispute about the fact might affect the outcome of the suit. Id. In determining whether a genuine issue of material fact exists, the court must view the facts and all reasonable inferences drawn from those facts in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

Initially, the moving party has the burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party has met this burden, the nonmoving party must identify, by affidavits or otherwise, specific facts showing that there is a genuine issue for trial. Id.; Maidenbaum v. Bally's Park Place, Inc., 870 F. Supp. 1254, 1258 (D.N.J. 1994). Thus, to withstand a properly supported motion for summary judgment, the nonmoving party must identify specific facts and affirmative evidence that contradict those offered by the moving party. Anderson, 477 U.S. at 256–57, 106 S.Ct. 2505. Indeed, the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who 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, 477 U.S. at 322, 106 S.Ct. 2548.

In deciding the merits of a party's motion for summary judgment, the court's role is not to evaluate the evidence and decide the truth of the matter, but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249, 106 S.Ct. 2505. Credibility determinations are the province of the finder of fact. Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).

B. Analysis

Ohio Security moves for partial summary judgment to dismiss Porto Pavino's third-party liability and bad faith claims, as well as Legacy's liability claim. [Dkt. No. 46]. Ohio Security argues that these claims should be dismissed as a matter of law pursuant to the CGL policy and that, regardless, Plaintiff has no standing to bring its third-party claims under Count II. (Id. ). In opposition, Plaintiff and Legacy submit that summary judgment is premature as discovery is still ongoing, and even if it was not premature, there is a genuine factual dispute over liability. In addition, Plaintiff claims that it has standing to bring its third party claims as an additional insured under the CGL policy. [Dkt. No. 52 at 2; Dkt. No. 51 at 6-7].

1. Additional Discovery

"The court is obliged to give a party opposing summary judgment an adequate opportunity to obtain discovery." Dowling v. City of Philadelphia, 855 F.2d 136, 139 (3d Cir. 1988) (citations omitted). Accordingly, "[i]f a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order." Fed. R. Civ. Pro. 56(d) (emphasis added).

At the time the parties filed oppositions to the present motion, they had not conducted any depositions but exchanged...