White Knight Diner, LLC v. Owners Ins. Co.
| Decision Date | 02 August 2021 |
| Docket Number | Case No. 4:17-cv-02406-MTS |
| Parties | WHITE KNIGHT DINER, LLC, et al., Plaintiffs, v. OWNERS INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — Eastern District of Missouri |
Anthony G. Simon, John G. Simon, Anthony R. Friedman, Paul Tahan, The Simon Law Firm PC, Gonzalo A. Fernandez, Michael D. Stokes, Devereaux Stokes Nolan Fernandez & Leonard, St. Louis, MO, for Plaintiffs White Knight Diner, LLC, Larry Lee Hinds, Karen Freiner.
Timothy J. Wolf, Lucas James Ude, Brown and James PC, St. Louis, MO, for Defendant.
This matter is before the Court on the parties’ competing motions for summary judgment, Docs. [262] and [265]. Defendant has moved for summary judgement on all claims alleged against it. Plaintiffs have moved for partial summary judgment on their "claims for damages resulting from Owners’ ‘subrogation claims.’ " Doc. [265]. For the reasons explained below, the Court will deny Plaintiffs’ Motion for Summary Judgment and grant Defendant's Motion in full.
Plaintiffs Larry Lee Hinds and Karen Freiner own a building located at the intersection of Eighteenth and Olive in St. Louis in which Plaintiff White Knight Diner, LLC ("White Knight") operates. In March of 2015, two vehicles driven by individuals not involved in this suit collided with one another at the intersection of Eighteenth and Olive. The collision caused at least one of the vehicles to collide with the building, which caused the building damage. Besides the physical damage to the building, White Knight could not operate until necessary repairs were made. As such, they also lost business income.
White Knight had an insurance policy through Defendant Owners Insurance Company ("Owners") that covered such losses, so White Knight submitted a claim to Defendant for property damage and loss of business income. Owners paid Plaintiffs a total of $66,336.27 for their property loss and business loss. That payment accounted for $49,965.10 in property damage loss ($50,965.10 less a $1000 deductible) along with $16,371.17 for business income loss. Plaintiffs accepted the payment; they neither contested nor disputed the amounts Owners paid them under the insurance contract. And they never brought suit against Defendant based on the amount paid under the insurance contract. In fact, Plaintiff Hinds referred to Defendant as the "no problem people," as related to its handling of Plaintiffs’ claims. Doc. [269] ¶ 8.
After Plaintiffs received payment from Defendant, White Knight filed suit in Missouri state court seeking damages for lost income against both drivers involved in the collision at issue. Both drivers involved in the collision were insured, one by State Farm and the other by Progressive. While this litigation in state court between White Knight and the drivers was ongoing, Defendant, using the services of a separate company called Trover Solutions, Inc., submitted a "request for payment" to both State Farm and Progressive asking to recover the amount it paid to Plaintiffs, plus Plaintiffs’ deductible.1 See, e.g. , Doc. [271-12]. Progressive declined to pay Defendant. State Farm, though, paid $33,668.14 to Defendant via check dated December 8, 2015, an amount equaling one half the damages for which Defendant had paid Plaintiffs plus one half of Plaintiffs’ deductible. Doc. [269] ¶ 14. State Farm did not require a release from anyone in exchange for its payment to Defendant, and neither Defendant nor Plaintiffs gave State Farm any release in exchange for the payment. Id. ¶ 15. After Defendant received the money from State Farm, Defendant returned $500 to Plaintiffs as a pro rata share of the deductible Plaintiffs paid. Id. ¶ 17.
Meanwhile, White Knight's state claims against the State Farm insured driver and the Progressive insured driver continued. In the litigation, the driver insured by State Farm included a defense of set-off against White Knight for the amount that State Farm previously paid to Owners. Doc. [269] ¶ 19. White Knight moved to strike the set-off defense, and the state court struck it. Id. The State Farm insured driver filed a motion to reconsider, which White Knight opposed. Id. ¶¶ 20–21. White Knight argued that neither State Farm nor the insured driver were entitled to a set-off or credit pursuant to the holding of Hagar v. Wright Tire & Appliance, Inc. , 33 S.W.3d 605 (Mo. Ct. App. 2000) (Stith, J.). Id. ¶ 21. The state court agreed. Id. Circuit Judge Robert Dierker issued an order on March 7, 2017 finding that the driver insured by State Farm was not entitled to assert the defense of set-off against White Knight for the amount State Farm paid to Owners. Id. ¶ 22.
In April 2018, White Knight settled its state claims against the driver insured by Progressive for $25,000. Id. ¶ 27. Later, in September 2018, White Knight settled its claim against the driver insured by State Farm for $16,331.86. Id. ¶ 26. The $16,331.86 is what remained of the driver's $50,000 policy limit if you subtract the amount State Farm earlier provided to Owners. White Knight voluntarily accepted this settlement though it was successful in its argument that the State Farm insured driver was not entitled to assert the defense of set-off against White Knight for the amount State Farm paid to Owners.
Before those underlying state court cases even concluded, Plaintiffs brought this putative class action suit against Owners alleging that when Owners sought and received reimbursement from State Farm it was an "unlawful subrogation practice[ ]" that was "contrary to Missouri law." Doc. [208] ¶¶ 1–2. Plaintiffs allege they were damaged because Owners withheld Plaintiffs’ deductibles and "fail[ed] to fully compensate [them]." Id. ¶ 14. Owners, Plaintiffs claim, deprived them of their "ability to be made whole" through the "unlawful ‘subrogation claims.’ " Id. ¶ 15. Plaintiffs’ Third Amended Complaint2 lists nine counts, which are: (I) Declaratory Judgment; (II) Injunctive Relief; (III) Unjust Enrichment; (IV) Implied Covenant of Good Faith and Fair Dealing; (V) Unauthorized Practice of Law; (VI) Money Had and Received; (VII) Breach of Contract; (VIII) Compensatory Damages; and (IX) Punitive Damages. The Court previously dismissed Count V, unauthorized practice of law. Doc. [229]. Defendant now has moved for summary judgment on all remaining counts, noting though that only four of the eight remaining counts—Unjust Enrichment; Implied Covenant of Good Faith and Fair Dealing; Money Had and Received; and Breach of Contract—put forward a distinct theory of liability. Plaintiffs have moved for partial summary judgment. They ask the Court to find Owners’ action was "contrary to Missouri law and unlawful." Doc. [266] at 1.
The standards applicable to summary judgment motions are well settled, and they do not change when both parties have moved for summary judgment. See Tower Rock Stone Co. v. Quarry & Allied Workers Loc. No. 830 , 918 F. Supp. 2d 902, 905 (E.D. Mo. 2013) (citing Wermager v. Cormorant Twp. Bd. , 716 F.2d 1211, 1214 (8th Cir. 1983) ). Summary judgment is proper "if the movant shows 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) ; accord Hill v. Walker , 737 F.3d 1209, 1216 (8th Cir. 2013). The movant "bears the initial responsibility of informing the district court of the basis for its motion" and must identify "those portions of [the record] ... which it believes demonstrate 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). If the movant does so, the nonmovant must respond by submitting evidentiary materials that set out "specific facts showing that there is a genuine issue for trial." Id. at 324, 106 S.Ct. 2548 (quotation marks omitted).
"On a motion for summary judgment, ‘facts must be viewed in the light most favorable to the nonmoving party only if there is a "genuine" dispute as to those facts.’ " Ricci v. DeStefano , 557 U.S. 557, 586, 129 S.Ct. 2658, 174 L.Ed.2d 490 (2009) (quoting Scott v. Harris , 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) ). Where parties file cross-motions for summary judgment, each summary judgment motion must be evaluated independently to determine whether a genuine dispute of material fact exists and whether the movant is entitled to judgment as a matter of law. Husinga v. Federal-Mogul Ignition Co. , 519 F. Supp. 2d 929, 942 (S.D. Iowa 2007). "[T]he filing of cross motions for summary judgment does not necessarily indicate that there is no dispute as to a material fact, or have the effect of submitting the cause to a plenary determination on the merits." Wermager , 716 F.2d at 1214.
Because "[i]t is well established that standing is a jurisdictional prerequisite that must be resolved before reaching the merits of a suit," the Court first addresses Defendant's arguments that Plaintiffs lack standing to peruse their claims. City of Clarkson Valley v. Mineta , 495 F.3d 567, 569 (8th Cir. 2007). Plaintiffs, as the party invoking the Court's jurisdiction, bear the burden of establishing they have a "personal stake" in the case sufficient to answer the question: "What's it to you?" TransUnion LLC v. Ramirez , ––– U.S. ––––, 141 S. Ct. 2190, 2203, 210 L.Ed.2d 568 (2021). To answer that question in a way sufficient to establish standing, Plaintiffs must show: (i) that they "suffered an injury in fact that is concrete, particularized, and actual or imminent"; (ii) that the injury was likely caused by Defendant; and (iii) that judicial relief would likely redress the injury. Id. (citing Lujan v. Defs. of Wildlife , 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992) ).
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