Schneider Nat'l Carriers, Inc. v. United Specialty Ins. Co., CIVIL ACTION NO. 5:20-CV-363 (MTT)

CourtUnited States District Courts. 11th Circuit. Middle District of Georgia
Citation603 F.Supp.3d 1352
Docket NumberCIVIL ACTION NO. 5:20-CV-363 (MTT)
Decision Date10 May 2022

Megan Marie Early Soppa, Taylors, SC, Blair Joseph Cash, Kennesaw, GA, for Plaintiff.

Jennifer Wolak, Atlanta, GA, Megan Ashley McCue, Atlanta, GA, for Defendant.



In this declaratory judgment action, Plaintiff Schneider National Carriers, Inc. ("Schneider") seeks a declaration that Defendant United Specialty Insurance Company ("United") owes Schneider a duty to defend and indemnify in an underlying lawsuit. Doc. 10. Schneider has moved for summary judgment, arguing that it is an insured covered by a policy issued by United to Road Cargo, Inc. Doc. 26-1 at 8-12. For the reasons that follow, Schneider's motion for summary judgment on the issue of duty to defend is GRANTED . But because the underlying lawsuit is ongoing and liability has not been established, the duty to indemnify issue is not ripe. Thus, Schneider's motion for summary judgment on that issue is DENIED without prejudice.


On December 2, 2017, a truck driver employed by Road Cargo, Rajinderpal Singh, was involved in a motor vehicle accident with Steven Winiecki. Docs. 26-2 ¶ 1; 34-1 ¶ 1. The tractor and trailer driven by Singh were owned by Road Cargo, and Road Cargo had dispatched Singh to haul a load for Walmart. Docs. 26-2 ¶ 4-5, 13; 34-1 ¶¶ 4-5, 13. Winiecki sued Singh, Road Cargo, and others in Illinois state court for his injuries. Docs. 26-2 ¶¶ 14-15; 34-1 ¶¶ 14-15. Two years after Winiecki's original complaint, Winiecki's third amended complaint added Schneider as a defendant.2 Docs. 26-2 ¶ 31; 34-1 ¶ 31.

According to Winiecki, Walmart hired Schneider as a "motor carrier" to haul the load in question. Doc. 37-3 at 11-12. Walmart paid Schneider, and Schneider was listed on the bill of lading for the load. Id. Schneider then, according to Winiecki, hired Road Cargo as a "sub-hauler" to deliver the load. Id. at 12. Winiecki alleges that Schneider, as a motor carrier, employed Road Cargo and Singh, and thus Schneider is vicariously liable for their actions. Docs. 37-3 at 11-16; 26-2 ¶ 32; 34-1 ¶ 32.

Whatever Winiecki's reasons for alleging Schneider acted as a "motor carrier," that allegation gave rise to this coverage dispute. Schneider claims, notwithstanding Winiecki's allegations, that the "true facts" reveal that it was acting as a freight broker. Docs. 26-1 at 12-14; 38 at 3.

United's policy insuring Road Cargo provides that United has a duty to defend any "insured" against lawsuits for damages. Docs. 26-2 ¶ 20; 34-1 ¶ 20; 30 at 30. Insured is defined, in relevant part, to include "[a]nyone liable for the conduct of an ‘insured[,] " including anyone liable for the conduct of an individual permissibly operating a Road Cargo covered vehicle. Doc. 26-2 at 21; 34-1 ¶ 21; 30 at 30 (emphasis added). Because Winiecki seeks to hold Schneider vicariously liable for the acts of United's insureds, Schneider claims it is covered by United's policy. United disagrees.

In its letter denying coverage, United substantively addressed two reasons Schneider is not covered by its policy. First, relying only on Winiecki's allegations, United contended that Schneider was acting as a motor carrier. Doc. 10-3 at 5. The policy excludes from the definition of an insured:

(1) Any ‘motor carrier’ for hire or his or her agents or employees, other than [Road Cargo] and [Road Cargo's] employees.

Docs. 26-2 ¶ 21; 34-1 ¶ 21; 30 at 30 (quotations omitted). As noted, Schneider denies it was acting as a motor carrier and claims United should have considered abundant evidence confirming this.

Second, United, citing the very evidence Schneider says United should have considered in its first coverage argument, contends Schneider was actually a freight broker. And as a freight broker, United said Schneider could not legally be held liable for the actions of Road Cargo and its employee because Road Cargo was an independent contractor. Doc. 10-3 at 6. The evidence that Schneider was a freight broker is convincing. The master transportation contract between Schneider and Road Cargo said Schneider was a "freight broker" and Road Cargo was the "carrier"—not an agent or a "sub-hauler." Doc. 10-2 at 1. And the master contract provided that "[Road Cargo] is independent of [Schneider] and that [Road Cargo] has exclusive control and direction of the work [Road Cargo] performs[.]" Id. United concluded that "Schneider cannot reasonably be deemed to have been acting as a motor carrier as respects the haul at the time of the [a]ccident, and therefore cannot be vicariously liable for Road Cargo's conduct." Doc. 10-3 at 6. In short, United argued Schneider was not covered because Winiecki's claims against Schneider would eventually fail on the merits.

Finally, United's denial of coverage letter "reserved" other possible coverage defenses, including any based on the policy's "Exposure/Entity Exclusion," which excludes coverage for:

1. Bodily injury or property damage that was not caused by [Road Cargo] or resulting from the ownership, maintenance, or use of a covered auto by [Road Cargo]; or
2. Bodily injury or property damage caused by any other person or entity doing business with [Road Cargo] unless such person or entity is disclosed to [United] in writing and scheduled on [Road Cargo's] policy.

Id. ; Doc. 34 at 17; 30 at 43 (cleaned up).

United's denial letter set up an odd dichotomy. On the question of whether Schneider was acting as a motor carrier, United only looked to the "four corners" of Winiecki's complaint. Yet, on the question of whether Schneider was a freight broker that could not ultimately be vicariously liable for the acts of United's insureds, United cited authority establishing that it was not confined to the "four corners" of the complaint and thus considered "true facts" establishing that Schneider was acting as a freight broker.3 Doc. 10-3 at 6.

This dichotomy was not to last. Perhaps understandably, United does not now rely on its second coverage defense.4 In its place, United relies on its "reserved" defense that the exposure/entity exclusion precludes coverage.5 Doc. 34 at 16-18. But in the process, United demonstrated that it knew of "true facts" outside the "four corners" of the complaint establishing that Schneider acted not as a motor carrier but a freight broker.


A movant is entitled to summary judgment upon showing "that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). When the movant bears the burden of proof at trial, it must show there is no genuine dispute that it has met the elements of its claim or defense. See United States v. Four Parcels of Real Prop. , 941 F.2d 1428, 1438 (11th Cir. 1991). The non-movant may defeat a properly supported motion by producing "significant, probative evidence demonstrating the existence of a triable issue of fact." Id. (quoting Chanel, Inc. v. Italian Activewear of Fla., Inc. , 931 F.2d 1472, 1477 (11th Cir. 1991) ). In other words, that there is indeed a genuine dispute regarding a material fact. See id.

"A factual dispute is genuine only if ‘a reasonable jury could return a verdict for the nonmoving party.’ " Info. Sys. & Networks Corp. v. City of Atlanta , 281 F.3d 1220, 1224 (11th Cir. 2002) (quotation marks omitted). Therefore, when deciding if summary judgment is appropriate, the court must not "weigh the evidence and determine the truth of the matter" on its own but should determine only whether a reasonable jury could find in favor of the non-movant. Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ("[C]redibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge."). In doing so, the court should draw all justifiable inferences, and resolve any reasonable doubts concerning the facts, in favor of the non-movant. Id. at 255, 106 S.Ct. 2505 ; Info. Sys. & Networks Corp. , 281 F.3d at 1224. If, after reviewing the entirety of the record "in the light most favorable to the [non-movant]," the court determines a reasonable jury could not find in favor of the non-movant, then summary judgment is appropriate. Strickland v. Norfolk S. Ry. Co. , 692 F.3d 1151, 1154 (11th Cir. 2012) (" ‘[T]he District Court [must] consider all evidence in the record when reviewing a motion for summary judgment—pleadings, depositions, interrogatories, affidavits, etc.—and can only grant summary judgment if everything in the record demonstrates that no genuine issue of material fact exists.’ "). (quoting Tippens v. Celotex Corp. , 805 F.2d 949, 952 (11th Cir. 1986) ).


Both parties agree that Georgia law controls because, although the policy was delivered in California, there is no California statute that governs the outcome. Docs. 26-1 at 7; 34 at 4; see Barrs v. Auto-Owners Ins. Co. , 564 F.Supp.3d 1362, 1372-73 (M.D. Ga. 2021) ; Mt. Hawley Ins. Co. v. East Perimeter Pointe Apartments , 861 F. Appx 270, 275 (11th Cir. 2021).

"Insurance is a matter of contract and the parties are bound by the terms of the policy." Richmond v. Ga. Farm Bureau Mut. Ins. Co. , 140 Ga. App. 215, 221, 231 S.E.2d 245, 249-50 (1976) (citations omitted). In Georgia, the interpretation of an insurance policy is generally "a question of law," to which courts apply the "ordinary rules of contract construction." O.C.G.A. § 13-2-1 ; Boardman Petroleum, Inc. v. Federated Mut. Ins. Co. , 269 Ga. 326, 327, 498 S.E.2d 492, 494 (1998) (citations omitted). "Every insurance contract shall be construed according to the entirety of its terms and conditions as set forth in the policy and as amplified, extended, or modified by any rider, endorsement, or application made a part of...

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