Allstate Insurance Company v. Richard Thacher et al, No. 2:2008cv03326 - Document 240 (C.D. Cal. 2011)
Court Description: ORDER by Judge Ronald S.W. Lew. The Court reasons that the interests of judicial economy mandate that the Court VACATE its November 23, 2009 Order 196 granting both Plaintiffs Motion for a New Trial on the sole issue of damages as well as Plaintiffs Motion to Alter or Amend the Judgment. The Court instead reinstates the September 18, 2009 Judgment 173 , and that Judgment will now serve as the Final Judgment that may be reviewed upon appeal. (Refer to attached docuemnt for details.) (lom)
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Allstate Insurance Company v. Richard Thacher et al Doc. 240 1 O 2 JS-6 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 Allstate Insurance Co., 13 14 Plaintiff, 15 16 v. 17 18 Richard Thacher, et al., 19 20 Defendants. 21 22 23 ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CV 08-3326-RSWL (FMOx) ORDER This Court concluded a seven day jury trial in this matter on August 12, 2009. The jury returned a verdict 24 25 in favor of Defendants Richard Thacher, Valerie Ann 26 Thacher, and Guadalupe Trujillo on three issues. The 27 jury found: 1) Plaintiff Allstate Insurance Company 28 Dockets.Justia.com 1 (“Plaintiff Allstate”) did not mail a notice of non2 renewal of the Comprehensive Personal Liability Policy 3 4 (“CPL Policy”) to Richard and Valerie Thacher; 2) 5 Plaintiff Allstate denied coverage under the Personal 6 Umbrella Policy (“Umbrella Policy”); and 3) the 7 arbitration award was not unreasonable or the product 8 9 of fraud or collusion. 10 11 On September 18, 2009, the Court entered Judgment for Defendants on Plaintiff Allstate’s claim for 12 13 Declaratory Relief, and for Defendants’ Counterclaims 14 for Breach of Contract and relief under California 15 Insurance Code § 11580 [173]. The September 18, 2009 16 Judgment awarded Defendants the full amount of the 17 18 underlying state court judgment in Trujillo v. Thacher, 19 the amount of attorneys’ fees and costs expended by Mr. 20 Thacher in defending himself against Ms. Trujillo in 21 22 23 Trujillo v. Thacher, and interest. Plaintiff Allstate brought a Motion for Judgment as 24 a Matter of Law after the presentation of Defendants’ 25 case in chief at trial [145]. The Court denied the 26 27 Motion. Subsequently, on October 6, 2009, Plaintiff 28 Allstate filed a Renewed Motion for Judgment as a 1 Matter of Law and, in the alternative, Motion for a New 2 Trial [181] and a Motion to Alter or Amend the 3 4 5 September 18, 2009 Judgment [183]. On November 23, 2009, the Court denied Plaintiff 6 Allstate’s Renewed Motion for Judgment as a Matter of 7 Law [196]. First, the Court denied Plaintiff 8 9 Allstate’s Renewed Motion on the grounds that the 10 mailing of notice was an issue of fact, and not law, 11 which the jury reasonably determined at trial. Second, 12 13 the Court denied Plaintiff Allstate’s Renewed Motion on 14 the grounds that the jury’s determination of coverage 15 gave rise to Plaintiff Allstate’s duties to defend and 16 indemnify. 17 With regard to Plaintiff Allstate’s Motion for a 18 19 New Trial, the Court granted, in part, Plaintiff’s 20 Motion [196]. The Court held that the amount of 21 22 damages awarded were excessive in light of the prior 23 settlement discussions between Defendant Trujillo and 24 Defendants Thacher. Therefore, the Court ordered a new 25 trial for the sole purpose of determining the 26 27 appropriate amount of damages. 28 Moreover, the Court granted Plaintiff Allstate’s 1 Motion to Alter or Amend the Judgment [196]. 2 The Court found that Defendants’ Section 998 offer was not made 3 4 in good faith and held that it would not award 5 Defendants their post offer costs or interest under 6 California Civil Code section 3291. Accordingly, the 7 Court granted Plaintiff’s Motion to Alter or Amend the 8 9 Judgment to the extent that no post offer costs or 10 interest shall be awarded to Defendants. 11 The Court held that the amount of the actual judgment shall be 12 13 determined by a jury in the new trial ordered by the 14 Court. 15 On December 21, 2009, Defendants filed a Motion for 16 Reconsideration of the Court’s November 23, 2009 and 17 1 18 June 30, 2009 Orders [201]. On March 24, 2010, the 19 Court denied the Motion for Reconsideration as to both 20 the June 30, 2009 Order and the November 23, 2009 Order 21 22 23 24 25 26 27 28 1 On June 30, 2009, the Court issued an Order regarding the Parties Cross-Motions for Summary Judgment and/or Partial Summary Judgment. The Court found that Plaintiff Allstate had received notice of the claim and no separate notice was required to tender under the umbrella policy. The Court further found that the umbrella policy did not require the Thachers to maintain primary coverage. Furthermore, the Court found that Plaintiff Allstate had not acted in bad faith [76]. 1 because Defendants had failed to establish that there 2 had been a significant change in the facts or law with 3 4 regard to the Case [219]. Moreover, the Court denied 5 Defendants’ request for appellate review pursuant to 6 Federal Rule of Civil Procedure 54(b). 7 With respect to Defendants’ request for 8 9 certification pursuant to 28 U.S.C. § 1292(b), 10 Defendants sought certification of two questions, one 11 for the June 30, 2009 Order and one for the November 12 13 23, 2009 Order. The June 30, 2009 Order addressed the 14 Motion for Summary Judgment on Defendants’ bad faith 15 counterclaim. In its March 24, 2010 Order [219], the 16 Court denied Defendants’ request to certify the issue 17 18 of bad faith for interlocutory appeal. However, as to 19 the November 23, 2009 Order, the Court granted 20 Defendants’ request for interlocutory appeal. The 21 22 Court certified the following issue for appeal: 23 Can this Court order a new trial, based solely on 24 the excessiveness of the damages awarded, if the 25 jury did not find the arbitration award 26 27 unreasonable or the product of fraud or collusion. 28 On June 15, 2010, the Ninth Circuit issued an Order 1 denying the petition for permission to appeal pursuant 2 to 28 U.S.C. § 1292(b) [220]. 3 4 In its November 23, 2009 Order, the Court GRANTED 5 Plaintiff’s Motion for a New Trial to determine the 6 appropriate amount of damages. A Court trial on the 7 8 issue of damages was set for March 15, 2011. On 9 March 1, 2011, the Court held a status conference with 10 the Parties and vacated the Court trial set for March 11 15, 2011. The Court instructed counsel to meet and 12 13 confer to determine whether this Case would proceed as 14 a trial de novo or a Court trial on the issue of 15 damages only. 16 On April 8, 2011, the Parties submitted a Joint 17 18 Status Report to the Court. Defendants informed the 19 Court that they would seek a Court trial on the issue 20 of damages only. However, Plaintiff Allstate elected 21 to have this Case proceed as a trial de novo. On May 22 23 16, 2011, the Court informed the Parties that it was 24 contemplating vacating its November 23, 2009 Order 25 [196] granting Plaintiff’s Motion for a New Trial on 26 27 the sole issue of damages as well as Plaintiff’s Motion 28 1 to Alter or Amend the Judgment. 2 On May 31, 2011, the Parties submitted further briefing to the Court with 3 4 5 regard to their respective positions on this issue. Upon further review of the arguments presented and 6 the overall litigation history in this Action, the 7 Court now VACATES its November 23, 2009 Order [196] 8 9 granting both Plaintiff’s Motion for a New Trial on the 10 sole issue of damages as well as Plaintiff’s Motion to 11 Alter or Amend the Judgment. An order granting a new 12 13 trial is interlocutory and not immediately appealable. 14 Allied Chemical Corp. v. Daiflon, Inc., 449 U.S. 33, 34 15 (1980). Furthermore, an order granting a new trial may 16 be set aside after the expiration of the term at which 17 18 it was entered, and judgment rendered on the verdict. 19 Storey v. Storey, 221 F. 262, 263 (D.C. Wis. 1915). 20 Upon further consideration, the Court finds that 21 22 the jury could not determine the amount of damages to 23 award to the Defendants in the first trial. Rather, 24 the jury was limited to determining whether the 25 arbitration award was unreasonable or the product of 26 27 fraud or collusion. The jury in a new trial will be 28 1 limited to resolving this same issue, which could 2 potentially lead to a similar verdict to the one 3 4 returned by the jury in the first trial, thereby not 5 resolving this Court’s disagreement with regard to 6 Defendant Trujillo receiving an excessively high 7 damages award. 8 While the Court found the damages awarded to 9 10 Defendant Trujillo in the arbitration were excessive in 11 light of Defendant’s actual injuries and the settlement 12 13 figures proposed initially, upon further review of the 14 arguments presented, the Court finds that proceeding 15 with a trial de novo could lead to a similar verdict to 16 the one returned by the jury in the first trial. 17 Moreover, contrary to Plaintiff Allstate’s 18 19 contentions, the Court did not err in presenting the 20 jury the following question in the special verdict form 21 22 [163] in the first trial: “Was the arbitration award 23 unreasonable or the product of fraud or collusion?” In 24 Plaintiff Allstate’s initial filing of a proposed 25 special verdict form, Question No. 3 inquired as to 26 27 whether the arbitration award was the product of fraud 28 or collusion while Question No. 4 inquired, separately, 1 as to whether the arbitration award was unreasonable 2 [139]. The Court finds that it did not err in 3 4 combining these two questions into a single question 5 and that Plaintiff Allstate’s arguments indicating 6 otherwise are not compelling. 7 Accordingly, the Court reasons that the interests 8 9 of judicial economy mandate that the Court VACATE 10 its November 23, 2009 Order [196] granting both 11 Plaintiff’s Motion for a New Trial on the sole issue of 12 13 damages as well as Plaintiff’s Motion to Alter or Amend 14 the Judgment. The Court instead reinstates the 15 September 18, 2009 Judgment [173], and that Judgment 16 will now serve as the Final Judgment that may be 17 18 reviewed upon appeal. 19 20 DATED: June 30, 2011 21 22 23 IT IS SO ORDERED. /S/ RONALD S.W. LEW 24 25 26 27 28 HONORABLE RONALD S.W. LEW Senior, U.S. District Court Judge
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