Reyes v. United States of America, et al, No. 1:2008cv00005 - Document 74 (D. Guam 2010)

Court Description: Opinion and Order Re 46 Motion for Summary Judgment. Guam Insurance Adjusters, Inc.'s Motion for Summary Judgment is GRANTED in its entirety. Signed by Chief Judge Frances M. Tydingco-Gatewood on 12/13/2010. (fad, )

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1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT DISTRICT OF GUAM 7 8 JESSE JAMES CRUZ REYES, 9 Plaintiff, 10 11 12 13 14 Civil Case No. 08-00005 vs. UNITED STATES OF AMERICA; THE DEPARTMENT OF THE NAVY; DCK PACIFIC GUAM, LLC, f/k/a DICK PACIFIC CONSTRUCTION CO.; GUAM INSURANCE ADJUSTERS, INC.; and DOE DEFENDANTS 1-98, OPINION AND ORDER RE: MOTION FOR SUMMARY JUDGMENT Defendants. 15 16 17 Before the court is the Motion for Summary Judgment filed by Defendant GUAM 18 INSURANCE ADJUSTERS, INC. See Docket No. 46. For the reasons given below, the court 19 GRANTS that motion in its entirety. 20 I. BACKGROUND 21 The facts in this case are as follows. JESSE JAMES CRUZ REYES ( Plaintiff ) worked as 22 a construction laborer for Defendant DCK PACIFIC GUAM, LLC ( DCK ), formerly known as 23 DICK PACIFIC CONSTRUCTION CO. ( Dick Pacific ). DCK had assigned Plaintiff to work on 24 a project at Naval Base Guam. On or about May 17, 2006, Plaintiff fell off a scaffold, from a height 25 of approximately 15 to 30 feet, onto a concrete surface. He suffered various head injuries, including 26 skull fractures. He claims to be permanently and totally disabled. 27 \\ 28 \\ 1 The operative complaint in this case is the Second Amended Complaint ( the Complaint ). 2 See Docket No. 40.2 Defendants UNITED STATES OF AMERICA ( the United States ) and 3 DEPARTMENT OF THE NAVY ( the Navy ) have answered the Complaint (see Docket No. 44), 4 as has Defendant TERRACE GUAM, LTD. ( Terrace ) (see Docket No. 52). 5 On May 27, 2010, Defendant GUAM INSURANCE ADJUSTERS, INC. ( GIA ) moved for 6 summary judgment. See Docket No. 46 ( the Motion ); see also Docket Nos. 47, 48, 58, 59, 61 7 (related filings). 8 II. JURISDICTION AND VENUE 9 Plaintiff s claims against the United States are within the court s exclusive jurisdiction. See 10 28 U.S.C. § 1346(b)(1). All remaining claims are within the court s supplemental jurisdiction. See 11 28 U.S.C. § 1367(a). Venue is proper in this judicial district because Plaintiff is a resident of the 12 District of Guam and the acts and omissions complained of also occurred within the District of 13 Guam. See 28 U.S.C. § 1402(b). 14 III. APPLICABLE STANDARDS 15 Summary judgment is proper if the pleadings, the discovery and disclosure materials on file, 16 and any affidavits show that there is no genuine issue as to any material fact and that the movant is 17 entitled to judgment as a matter of law. FED . R. CIV . P. 56(c)(2). 18 A fact is material if it might affect the outcome of the suit under the governing substantive 19 law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is genuine 20 where the evidence is such that a reasonable jury could return a verdict for the nonmoving party. 21 Id. The mere existence of a scintilla of evidence . . . will be insufficient; there must be evidence 22 on which the jury could reasonably find for [the opposing party]. Id. at 252.3 23 When the movant does not bear the burden of proof on an issue, the movant need only point 24 to the absence of evidence to support the opponent s burden. See Celotex Corp. v. Catrett, 477 U.S. 25 26 27 28 2 Plaintiff has requested a jury trial, but is not entitled to one. See 28 U.S.C. § 2402. The court applies Guam substantive law but federal procedural law. See Gasperini v. Ctr. for Humanities, Inc., 518 U.S. 415, 426-28 (1996). As such, federal standards determine whether the evidence is sufficient to raise a question for the trier-of-fact. See Gasaway v. Northwestern Mut. Life Ins. Co., 26 F.3d 957, 960 (9th Cir. 1994). 3 Page 2 of 6 1 317, 324 (1986). To avoid summary judgment on an issue upon which the opponent bears the 2 burden of proof, the opponent must present affirmative evidence sufficiently probative such that a 3 jury reasonably could decide the issue in favor of the opponent. See Matsushita Elec. Indus. Co. v. 4 Zenith Radio Corp., 475 U.S. 574, 588 (1986). 5 The term sufficiently probative means that the opposing party s evidence must be sufficient 6 to create a genuine issue of fact that is material to the outcome of the suit, whether or not it has the 7 burden of proof at trial. See McCabe v. General Foods Corp., 811 F.2d 1336, 1340 (9th Cir. 1987). 8 In sum, [w]hen the moving party has carried its burden under Rule 56(c), its opponent must 9 do more than simply show that there is some metaphysical doubt as to the material facts. . . . Where 10 the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, 11 there is no genuine issue for trial. Matsushita, 475 U.S. at 586-87. 12 IV. DISCUSSION 13 Plaintiff does not allege that GIA itself harmed him. See generally Docket No. 40. Rather, 14 Plaintiff has sued GIA on the theory that it is an insurer of an entity that, he alleges, did harm 15 him namely, his then-employer, DCK. See id. at ¶6. 16 On this theory, Plaintiff can name GIA in this lawsuit because of Guam s direct-action 17 statute. See 22 G.C.A. § 18305. Section 18305 gives a person who is suing on a policy of liability 18 insurance a right of direct action against the insurer within the terms and limits of the policy . . . 19 provided that the cause of action arose in Guam. Id. Thus, the naming of GIA in this lawsuit is 20 permissible only if GIA is truly an insurer within the meaning of the direct-action statute. 21 A. 22 For purposes of Guam s direct-action statute, certain definitions obtain. The word insurer 23 means the person who undertakes to indemnify another by insurance, where insurance means 24 a contract whereby one undertakes to indemnify another against loss, damage, or liability arising 25 from contingent or unknown events. 22 G.C.A. §§ 12104(q), -(r). The word adjuster means any 26 person who acts for or on behalf of an insurer or an insured in determining and making settlement 27 of the amount payable to the insured for any loss or damage under a policy. Id. § 12104(e). 28 Definitions Page 3 of 6 1 Thus, for purposes of the direct-action statute, an adjuster is distinct from an insurer. 2 GIA argues that it is an adjuster, not an insurer. If GIA is correct, then Plaintiff s action against 3 it is unfounded, and summary judgment in its favor is appropriate. 4 B. 5 In support of its argument, GIA adduces several pieces of evidence. First, it has excerpts of 6 the January 6, 2010 deposition of Keith Young Yoo. See generally Docket No. 46 at 7-35. Yoo is 7 the Property and Casualty Claims Supervisor for GIA. See id. at 13:1-5. During direct 8 examination by Plaintiff s lawyer, Yoo stated that Terrace is the captive insurer of Dick Pacific (id. 9 at 21:4-23); that Terrace rather than GIA issues the checks that constitute insurance payments (id. 10 at 22:11-21); that GIA is a third-party administrator of the worker s compensation claims filed by 11 Dick Pacific (id. at 23:13-22); and that GIA is an adjusting company that handles worker s 12 compensation claims for Dick Pacific (id. at 25:5-15). Second, GIA has the Declaration of Henry 13 L. Metcalfe, GIA s General Manager. See Docket No. 47. Metcalfe corroborates Yoo, stating that 14 GIA is an adjuster, not an insurance carrier, and that it has never issued an insurance policy to 15 anyone, including DCK. See id. at ¶¶3-5. Third, GIA proffers its Articles of Incorporation and its 16 2009 Annual Report, which both indicate that GIA is in the business of insurance adjustment, as 17 well as such other business as may be delegated to it by insurance companies. See Docket No. 61 18 at 6-9. Finally, GIA proffers some copies of some checks made out to Plaintiff. See id. at 10-12. 19 These checks also corroborate Yoo, in that they list Terrace rather than GIA as the payor. See id. Evidence 20 In opposition, Plaintiff adduces two sets of documents. First, he has a set of Health 21 Insurance Claim forms. See Docket No. 59 at 3-13. These documents were produced by GIA s 22 custodian of records. See id. at 1, ¶2. It is not clear who completed these forms, but they all pertain 23 to Plaintiff. See id. at 3-13. And in all of them, Box 11(c), titled INSURANCE PLAN NAME OR 24 PROGRAM NAME, reads either WC-GUAM INSURANCE ADJUSTERS or Guam Insurance 25 Adjusters Inc. Id. Second, Plaintiff has a set of forms with WORKER S COMPENSATION 26 COMMISSION at the top. See id. at 14-24. These documents were produced by DCK s custodian 27 of records. See id. at 2, ¶3. Once again, it is not clear who completed these forms some appear 28 Page 4 of 6 1 to have been completed by physicians, while some appear to have been completed by DCK s safety 2 manager but they all pertain to Plaintiff. See id. at 14-24. Each of these documents has a box titled 3 either Name & address of Insurance Carrier to whom COPY of your report and BILL are to be 4 sent, or Name of insurance carrier. Id. GIA is named in each of these boxes, as Guam Insurance 5 Adjusters, Inc. or as Guam Insurance Adjusters. Id. 6 C. 7 The fact in dispute is whether GIA is an insurer within the meaning of Guam s direct- 8 action statute which fact is material because GIA must be an insurer in order for Plaintiff s 9 action against it to be authorized. See 22 G.C.A. § 18305. Plaintiff bears the burden of proof on this 10 issue, because establishing it is (obviously) an essential predicate of Plaintiff s action. See Docket 11 No. 40 at ¶6. Assessment 12 GIA has carried its initial burden. GIA has indicated that there is no evidence that it had 13 issued an insurance policy to DCK that was in force on the date of Plaintiff s injury. See Docket No. 14 46 at 2:24-3:4. GIA argues that this lack of evidence makes sense because it is not an insurance 15 company, and has never issued any insurance policy to anyone let alone to DCK. See id. GIA has 16 also proffered evidence that, taken together, affirmatively shows that it is an adjuster rather than an 17 insurer, and that Defendant Terrace is DCK s insurer. See Docket No. 46 at 7-35 (deposition of 18 Keith Young Yoo); Docket No. 61 at 6-7 (articles of incorporation), 8-9 (2009 annual report), 10-12 19 (checks from Terrace to Plaintiff). 20 Plaintiff, for his part, has not carried his burden. In its best light, all that Plaintiff s evidence 21 shows is that some people whoever filled out the forms think that GIA is an insurer. See Docket 22 No. 59 at 3-13, 14-24. This is not strong evidence of GIA s true nature as a business entity, though. 23 Plaintiff s evidence is also fully consistent with GIA being an adjuster rather than an insurer. In each 24 case, GIA s full name was listed, which identifies it as an adjuster. See id. Moreover, it makes sense 25 that GIA would be listed as it was: given what an adjuster does, many forms related to the processing 26 of insurance claims would naturally go to the adjuster, rather than to the insurer. It is simply in the 27 nature of the business of adjustment. See 22 G.C.A. § 12104(e). 28 Page 5 of 6 1 Plaintiff suggests that summary judgment may be premature. See Docket No. 58 at 2:19- 2 3:24. He states that he requires further discovery on the issue of GIA s relationship with DCK and 3 intends to submit discover[y] requests and to depose DCK and GIA representatives regarding this 4 relationship. But Plaintiff s lawyer has already deposed GIA representative Keith Young Yoo 5 regarding this relationship. As stated above, during direct examination by Plaintiff s lawyer, Yoo 6 stated that Terrace is the captive insurer of Dick Pacific (id. at 21:4-23); that Terrace rather than GIA 7 issues the checks that constitute insurance payments (id. at 22:11-21); that GIA is a third-party 8 administrator of the worker s compensation claims filed by Dick Pacific (id. at 23:13-22); and that 9 GIA is an adjusting company that handles worker s compensation claims for Dick Pacific (id. at 10 25:5-15). Plaintiff also now has the declaration of GIA s General Manager, Henry L. Metcalfe, 11 which states that GIA is an adjuster, not an insurance carrier, and that it has never issued an 12 insurance policy to anyone, including DCK (see Docket No. 47), as well as GIA s Articles of 13 Incorporation and 2009 Annual Report, which both indicate that GIA is in the business of insurance 14 adjustment (see Docket No. 61 at 6-9). Given all this, the court finds Plaintiff s concerns 15 unpersuasive and sees no reason to defer summary judgment on this issue. 16 In short, the record, taken as a whole, could not lead a rational trier of fact to find that GIA 17 is an insurer within the meaning of Guam s direct-action statute. See Matsushita, 475 U.S. at 586- 18 88. A rational trier of fact could only find that GIA is an adjuster, rather than an insurer a 19 distinction Guam law observes, which prohibits Plaintiff from suing GIA under the direct-action 20 statute. See 22 G.C.A. §§ 12104(e), -(q), -(r). As such, summary judgment for GIA is appropriate. 21 V. 22 23 24 CONCLUSION For the reasons set forth above, the Motion is hereby GRANTED. Accordingly, it is hereby ORDERED that judgment be entered in GIA s favor. SO ORDERED. 25 26 27 28 /s/ Frances M. Tydingco-Gatewood Chief Judge Dated: Dec 13, 2010 Page 6 of 6

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