State Farm Mut. Auto. Ins. Co. v. Biddle

• Decision Date: 19 January 2016
• Docket Number: 2:13cv824
• Citation: State Farm Mut. Auto. Ins. Co. v. Biddle, 2:13cv824 (W.D. Pa. Jan 19, 2016)
• Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. KAREN A. BIDDLE and DAWN C. EDWARDS, Defendants.
• Court: U.S. District Court — Western District of Pennsylvania

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff, v. KAREN A. BIDDLE and DAWN C. EDWARDS, Defendants.

2:13cv824

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA

January 19, 2016

Electronic Filing

OPINION

State Farm Mutual Automobile Insurance Company("plaintiff" or "State Farm") filed this action seeking a declaratory judgment that it does not have a duty to defend and/or indemnify under a policy of insurance providing motorist coverage to defendantDawn C. Edwards.The underlying lawsuit from which plaintiff seeks to absolve itself of any coverage obligation is an action in the Court of Common Pleas of Allegheny County, Pennsylvania, commenced by defendantKaren A. Biddle("Biddle" or "Karen Biddle") against Dawn C. Edwards and James E. Edwards at Biddle v. Edwards etal., GD 11 - 0011796.That action is ready for trial but has been stayed pending resolution of this declaratory judgment action.Presently before the court is Biddle's motion to stay this action until the underlying state court action is resolved.For the reasons set forth below, this court will decline to exercise its discretionary authority under the Declaratory Judgment Act pursuant to State Auto Ins. Companies v. Summy, 234 F.3d 131(3d Cir.2000) and its progeny.Accordingly, this action will be dismissed for want of subject matter jurisdiction and without prejudice to (1)plaintiff refiling its complaint for declaratory judgment in state court as authorized by 42 Pa. C. S. § 5103(b) and (2)defendant(s) raising any defenses they may have to that claim in state court.

In the underlying lawsuit Biddle filed an action against plaintiff's insureds, Dawn and James Edwards.The lawsuit arises from a November 9, 2009, multi-vehicle accident that occurred in Allegheny County, Pennsylvania on Interstate 79.Biddle was a passenger in a vehicle being driven in the northbound lane of Interstate 79 by her mother, Cheryl Biddle.The vehicle became involved in a minor accident due to stopped traffic.The vehicle became disabled.Biddle and her mother were exiting the vehicle.At that time Dawn Edwards also was traveling in the northbound lane of Interstate 79 at a high rate of speed and came upon the stopped traffic from the minor accident.Without warning or slowing down, the Edwards' vehicle struck the Biddles' disabled vehicle at a high rate of speed, causing it to become airborne.The airborne vehicle spun through the air in a counter-clockwise direction and struck, crushed and killed Cheryl Biddle.Karen Biddle, Cheryl's only child, was standing close to Cheryl and narrowly was missed by the flying vehicle.She directly observed the event and the death of her mother.She suffered cervical strain and contusions among other forms of physical and psychological trauma and injury during the event.

The underlying action was initiated on June 28, 2011.On July 27, 2011, plaintiff made a determination to defend the Edwards pursuant to a reservation of rights.The case progressed until it was set for trial on the March 19, 2013, call of the list.It was then continued to the next trail term, and thereafter set for the call of the list on September 20, 2013.

Plaintiff filed the instant action in this court on June 18, 2013.On July 15, 2013, Biddle filed a motion in the underlying lawsuit asserting that in the instant action State Farm is seeking to absolve itself of the duty to defend and indemnify "for any emotional distress damages" and representing that "the parties[were] seeking a Continuance in order to secure a ruling in the Declaratory Judgment action before going to the time and expense of litigating the [underlying] tort claim."Joint Motion for Continuanceat ¶ 4.Judge Folino granted the motion and continued the trial generally.

Biddle filed a motion to stay in the instant action on September 10, 2014, averring thatthrough the federal court filing State Farm is attempting "to insulate itself from potential excess liability before trail in the underlying action" by asking for "a decision regarding its insurance coverage obligations on material facts that remain unsettled, and in doing so, supplant[ing] the jury as finder of fact in the Underlying Action."Karen A. Biddle' Motion to Stay(Doc. No. 19) at ¶ 8.Biddle explains that State Farm contends that she did not suffer a form of "bodily injury" needed to trigger coverage and as a result State Farm asserts it is entitled to a declaration that coverage does not exist under the subject policy.

Biddle counters that the complaint in the underlying lawsuit avers that she"sustained severe physical and psychological trauma and injuries, including cervical strain, contusions and physical and psychological trauma and injury with resultant Post Traumatic Stress Disorder and Post Traumatic Depression."Id.at ¶ 3.These averments assertedly are enough to trigger State Farm's duty to defend and have it continue to do so until the jury in the underlying action decides "the factual questions that will determine State Farm's coverage obligations under the Policy."Id.at ¶ 17.From Biddle's perspective "State Farm's 'end-around' approach, which is decidedly self-protective, would require this Court to decide the very same facts that are at the crux of the Underlying Action and which are to be determined by the jury [in that lawsuit]."Biddle thus requests an order of stay be entered until the underlying lawsuit is resolved.

State Farm opposes the motion.From its perspective a stay would unfairly prejudice its "right to determine whether it is obligated to defend Ms. Edwards in the underlying [lawsuit]" and the precedent cited by plaintiff is distinguishable and fails to support a stay in any event.Plaintiff's Response in Opposition (Doc. No. 21)at 3.

State Farm recounts the general facts summarized above and advances the following assertions to support its position on coverage and the need to proceed with this declaratory judgment action.Biddle does not aver in the underlying lawsuit that she herself was struck by the Edwards/flying Biddle vehicles.The policy of insurance was issued in Indiana to an Indianaresident.Under Pennsylvania choice of law provisions the subject policy ultimately will be governed by Indiana law.The Indiana Supreme Court has held "that emotional distress damages arising from witnessing a substantial injury or death to a loved one does not constitute 'bodily injury' under [the applicable policy language]."Plaintiff's Brief in Opposition (Doc. No. 21)at 5(quotingState Farm Mut. Auto Ins. Co. v. D.L.B., 881 N.E.2d 665(Ind.2008)).Thus, State Farm interprets D.L.B. to mandate that Karen Biddle must have been struck by the Edwards and/or Biddle flying vehicle(s) in order to trigger its duty to defend under Indiana law.Id. at 6("The lack of physical impact between Ms. Biddle and either of the vehicles involved precludes a finding that Ms. Biddle's alleged damages constitute 'bodily injury' under the Edwards' automobile policy.")(citingD.L.B., 881 N.E.2d at 666).

Assuming for the sake of argument that Indiana law applies, it appears that Indiana law is in accord with Pennsylvania law on an insurer's duty to defend.Judge Springmann recently summarized the general principles of Indiana law governing a carrier's duty to defend:

The insured is required to prove that its claims fall within the coverage provision of her policy, but the insurer bears the burden of proving specific exclusions or limitations to policy coverage.SeeErie Ins. Group. v. Sear Corp., 102 F.3d 889, 892(7th Cir.1996)(applying Indiana law).An insurer's duty to defend its insureds against suit is broader than its coverage liability or duty to indemnify.Walton v. First Am. Title Ins. Co., 844 N.E.2d 143, 146(Ind. Ct. App.2006);Trisler v. Ind. Ins. Co., 575 N.E.2d 1021, 1023(Ind. Ct. App.1991).Although an insurance company can limit its duty to defend, cf.Walton v. First Am. Title Ins. Co., 844 N.E.2d 143, 147(Ind. Ct. App.2006)(stating that if the pleadings reveal that a claim is excluded under the policy, then no defense is required), an insurer is generally obligated to defend its insured against suits alleging facts that might fall within the coverage of the policy, Fed. Ins. Co. v. Stroh Brewing Co., 127 F.3d 563, 566(7th Cir.1997).The insurer's duty to defend is determined from the allegations of the complaint and from those facts known to or ascertainable by the insurer after reasonable investigation.Trisler, 575 N.E.2d at 1023.

Westfield Ins. Co. v. Hill, 790 F. Supp.2d 855, 860-61(N.D. Ind.2011).These principles essentially are in accord with Pennsylvania law on the subject.See, e.g., General Accident Ins. Co. of America v. Allen, 692 A.2d 1089, 1095(Pa.1997);Lucker Manufacturing v. The HomeIns. Co., 23 F.3d 808, 813(3d Cir.1994);USX Corp. v. Adriatic Ins. Co., 99 F. Supp.2d 593, 611(W.D. Pa.2000).

State Farm seeks shelter under what it perceives to be the sine qua non of the policy's definition of bodily injury: physical injury.More specifically, it maintains that in order to trigger its coverage obligations Karen Biddle must show that she suffered physical injury from the Edwards/flying Biddle vehicles and the record in the underlying lawsuit does not make that showing.

In support State Farm points out that in D.L.B.the Supreme Court of Indiana held that the emotional distress a young boy suffered as a result of witnessing his cousin's accidental death when they were both riding bicycles was not a form of covered bodily injury as defined under State Farm's policy.D.L.B. was not himself "physically injured" when he witnessed his cousin being struck and killed by a motor vehicle, but he did thereafter developed Post Traumatic Stress Disorder.D.B.L., 881 N.E.2d at 666.And although the Supreme Court of Indiana decided in a companion case that the term "bodily injury" as defined in the policy can include emotional distress, State farm ...