Herbst Gaming, Inc. et al v. Insurcorp et al, No. 3:2010cv00231 - Document 54 (D. Nev. 2010)

Court Description: ORDER GRANTING # 1 Motion to Withdraw Reference. FURTHER ORD GRANTING in part and DENYING in part # 8 Motion for Summary Judgment : The motion is granted with respect to transfer under § 542, professional negligence, breach of fiduciary duty, and bad faith, but denied with respect to intentional misrepresentation, negligent misrepresentation, and reformation. Signed by Judge Robert C. Jones on 12/29/2010. (Copies have been distributed pursuant to the NEF - DRM)
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LEG AL STAN DAR DS 2 A. 3 TheSuprmeCour h r e t taba r ptyco r tej esofwhihaeno e t as uld ha nk u c u t h udg c r t W ihdrawaloft R ef t he erence 4 afr dt pr e to oflf tnur a ird bl slr gi nt j sun rAri eII fode he otcins ie e e nd re uci e aay ve o udge de t I of cl 5 teCo tt i -- an e e fnalu nt onmatesta t lyde i dbyAril 11 h nsiuton c not ntr i j dgme s tr rdii l cde ona tce 1 I 6 j s s ba c r tdiputs Se Dun r v Unie St e 358F.d 11 7,l 1 ( hCi, udge, uc s ontac s e . e mo e . td ats, 3 0 l 4 9t r : 7 200 (ii N. pei Co t.Co. Mar ho Pi Li Co.458U. 5 ( 98 ) Con es 4) ctng Pl lne nsr v. at n pe ne , S. 0 1 2). grs 8 a mend d t Ban u c Code t c nf m t t snli g,d si s i ç or ' ba nl c e he kr pt y o o or o hi ln i tngui h ng ç e ' nk pt y c 9 pr oceedi fom tnon- e' pr ngs r s cor ' oceedi l Congr has e e at whati cons der t be ngs. d. ess num r ed t i so 1 c epr e ngs s i (ii 11U. 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C. hre ae is f a e rwhih src c rs vej iditon nde S. jl 3 () Th tidc ty nzn ld sc ssteae t'ac s u d rt l 1 .As 3 4b . e hr ae o icu e ae C ltd o' a e n e ie l r t t Fit Cic tha e a ne he fh r ui s xpl l d, 25 Page 6 of 22 1 2 Congr s us t phr tarsng under tte 1l' t descrbe t es ed he ase t ii il ' o i hose pr edi t i ve a caus of acton cr ed or det m i by a oce ngs hat nvol e i eat er ned sam t y pr son oftte 11 ....The m eani of'ars ng i 'pr t or ovi i il ng t ii n' oceedi ngs i l scl , s st bear er s es ear but eem o ef encet t o hosetadm i s r tve'm a t st t ni t ai ' ter hat ' 3 ' 4 to e ta ae n tb sd o a y rg te ge sy ce td b tte 1 ,b t h s h t r o ae n n ib x r sl rae y il 1 u ne rhee s woul ha noe se eousdeofteba upty. vet ls, d ve xitnc tl h nkr c l 5 ' a ieonl i ba k u c c s s I ot rwo ds d rsngi ' r e di a e rs y n n r pty a e . n he r ,t ii n'p oc e ngs r a Thec tc cl de $ ft pr e di doe n i e a s t n i rgh cr a e our on u d: ç he oc e ng s ot nvok ubs a tve i t e t d l 6 by t f albankr cy I and i onet coul exi out de ofbankr cy i i he eder upt aw s hat d st si upt t s nota cor pr edi i m ay be r at t t bankr cy becaus of is pot i e oce ng; t el ed o he upt e t ental efect but...i i an ç herwie r at ornon- e pr f > t s ot s el ed' cor oceedi ' ng.' ' 7 I r Easpo t s c .935F. l ,1 76- ( hCi.1 )(i inso te ( i l r n e t r As o s, 2d 071 0 77 9t r 991 cmto mitd) quotng n e 8 ; Woo 825F. 9 96- ( t Ci.l 87)(oo e o itdl. d, 2d 0, 97 5 b r 9 f mots m te ) 9 Upon m oto ors s nt a diti tc r m a wih a , n whoi ori pa q a c s o i n ua po e s rc ou t y t dr w i e n r ny a e r l0 pr e di unde j 1 11U. C.j l ( .A dititc tmus up tmel motonwihcr w oc e ng r 57. S. 57 d) src our t on i y i t la 11 a pr ce d ng i i d e m i s' ha r ol i oft p oc e ng r quie c i r to ofbot o e i f t et r ne t t es uton be r e di e r s onsde a i n t h 1 2 tte 1land ot l w soft U nied St esr atng or zatonsoractvii af ectng il her a he t at egul i gani i i tes f i 1 3 i er t e com m er ' 1 Thepary m ovi f wibdr nt s at ce.' d. t ng or t awalhast bur ofper uason.SeeI he den s i n 1 4 . r Fis Ali eMorg.Co.28 B. 8 90 ( D. l20 ) c r t lanc t , 2 R. 94, 2 C. Ca. 01. . 15 A lhougb a banknl cy cour m ay nott l det ne non- te 11 isues,t pre t pt t inaly enni Til s he sence l6 ofs h a is e doe notm a t wih a o t r f r nc I r Vi ar l s Agenc 96 F. uc n s u s nda e t dr wal f bc e e e e. n e c s n . y, 3d l7 949, ( t Ci.1 ) Rahe, t rwa i ma t ytnc s srqurngmae i 953 7h r 996 . t rwihda ls ndaor t a e e ii i tral 1 8 consi a i ofnonder ton bankr cy f all .'Sec.Far l F. at1 upt eder aw ' ms, 24 3d 008. Putdil enty, fkr l 1 9 tm andat y wihdr l or t awali r r onl when t e i uesr r t i er e aton,asopposed s tquied y hos ss equie he nt pr t i 2 0 t m er applcaton,oftl non-il 11st ut orwben t couztm ustunderakeanal i of o e i i le tte at e, he ' t ys s 21 si tcantopen and unr ved i uesr di t non- il l1l .' at954. Per i i gnii esol ss egar ng he tte aw '1d. m ss ve 22 wih a i alwe bowe rtf c us s tdrwals lo d, ve,tor a e hown, 11U. C.j1 ( , c adsrc c ur ' ' ' S. 57d)whib itit o t 23 d e nesbyc i rngth efcintus ofj ca rs ure ( c i e nc dwh nonetnni onsdei t e fi e e udiil e o c s whih s nha e en t 24 c r is sprdomiat)delya c t t t pate , fr t ofban r ptya nitai oe sue e n e, a nd oss o he ris uniomiy k u c dmi srton, 25 N Page 7 of 22 4 ! j . ' I l t pr he eventon off i orum s hoppi and ot r at f or 'Sec.Far 124 F. atl008. ng, her el ed act s.' ms, 3d 2 B. Rul 56c e () 3 TheFed rlRulsofCi lPr e r prvi frs mmayadudiainwbe the ea e vi oc due o de o u r j c to nt t 4 pl ngs de tons ans s t i erogat i and adm i onson tl t t w ib t eadi , posii , wer o nt r ores, ssi ie, oge her t he 5 am davis,i any,show t t e i no genui i ue ast any m at ri f and t t pary i t f hat her s ne ss o e al act hat he t s 6 e ildt aj dgme a amatroflw.' d. Ci P.56c.Maeilfcsaet ewhih ntte o u nt s te a 'Fe R. v. () tra a t r bos c 7 m ay afectt out e oft cas See Ander on v.Lï y Lobb I ,477 U . 242,248 r be com he e. s :crf y, nc. S. 8 ( 98 .A diput a t amaei fc i ge ui i t r i s fcin e d ncef araon bl 1 6) s e so tral a ts n ne f hee s ufi e t vie or e s a e 9 j r t rtr aver c f tenonmo ngpat Se i A prncpa pur eofs uy o eun dit or h vi ry. e d. i i l pos ummay r 1 j dgme i tt iolt a dipos offctalyu up tdcams'Ceoe Cor v Catet 0 u nts so s ae nd s e a u l ns pore li . ltx p. . r t, ' ll 47 U. 31 323 4(1 ) 7 S. 7, -2 986 . 1 2 l dee mi n s n tr nig ummayj r udgme ,ac r us sabu d n-hitngshe nt ou t e r e s fi c me: 1 3 W he t pat movi f s mmayj n he ry ng or u r udgme woul be rt burenofpr a nt d a he d oof t 1 4 15 t i ,i m us com e f ral t t onva d w ih evi r t dencewhi w oul entte i t adiect ver ct ch d il t o r ed di i t evi f he dencewentuncontovertd atti .l s acas tl m ovi r e ral n uch e,le ngparyhast t he i talbur of es a ihi t a nii den t bls ng he bsence ofa genui i ue of f on each i s ne ss act s ue m at i t is cas eral o t e. 1 C. R.Tr s Br eageCo.v Dar e Re s, n .21 F.d47 480( hCi. )(iains 6 A. anp. ok r . d n st.I c, 3 3 4, 9t r2000 ctto 1 omitd .l c r s, nt non n pat be r t bude ofpr n t cam or 7 te ) n ontatwhe he movig ry as he r n ovig he li l d fns t movi pat c me tisbude i t wa s: 1 byprs nige de et ne t 8 ee e,he ng ry an e t r n n wo y () e e tn vi nc o gae 1 a e s nta ee ntoft non o ng p ry' c s o ( byde 9 n se il lme he m vi a t s a e; r 2) monsr tngt tt enonmo ng ta i ha h vi 20 pa y f l t m ake ashow i sufi entt est i an el entess i t t pary' case on rt aied o ng fci o ablsb em ental o hat t s 21 whi h t tpa t w ilbe rt e bur e ofpr fa ti l Se Ce otx Cor z 7 U . a 3 -24. l c ba ry l a h dn oo t ra . e l e p. 47 S. t 23 f 22 t movngpat fist me isiiilbude s he i ry al o ett nta r n, ummayj r udgme mus bede eda t c r nt t ni nd he out 23 ne d n c i rt n ovi g pa t se de e Se Ad c s v S. . -. d:Co. 3 U . e ot onsde he onm n ry' vi nc . e i ke . H Ai u c , 98 S. 2 1 1 -60( 970 . 4 44, 59 1 ) 25 l t m ovi pary m eet is i talbur f he ng t s t nii den,t burden t s fst t opposi pary t he hen hit o he ng t o Page 8 of 22 1 es a ih a genui i ue ofm at i f .See M at t bls ne ss eral act sushia El I t ec. ndus.Co.v.Zenih Radi Cor , t o p. 2 475U. 57 586( 98 .Toesa ibt e se eofafc ldiput t op i pat S. 4, 1 6) tbls he xitnc a ma s e,he posng ry 3 need notesabls a m at i isue off tconcl vel i is f . l i s fci t tt t ib eral s ac usi y n t avor t s uf i ent hat the : I . 4 camedfcu ldiput bes ownt rquieaj yorudget rs vet pate 'difrng li a ta s e h o e r ur j o eol he ris fei 5 ver i oft tut atti .'Tl El s'rk,Inc.v.Pac.El Cont or ..ç',809 F. sons he r h ral' B( ec. c ' . ec. ract s /$ n 1. 2d 6 626, ( hCi.1 ) I oh wor ,t n 631 9t r 987. n ter ds he onmovigpat cnno a ds n ry a t voi ummayj r udgme nt 7 by r yi sol y on concl y alegatonst ar unsuppored by f t dat See Ta or v. el ng el usor l i bat e t ac ual a. yl 8 Lit 88 F.d l 0,1 45(t Ci.1 .l ta t o iinmu tgobe dt a sri s, 0 2 04 0 9h r 989) nse d,he pposto s yon be setons 9 and alegatonsoft pl ngsand s f t s fc f s by pr l i he eadi et orh pecii act oduci com pet evi ng ent dencet hat 1 s wsage neis f ti . eFe R. v. 56() CeotxCor , 7U. a 324. 0 ho nui sue or ralSe d. Ci P. e ; l e p.47 S. t ll Attes mmayj gme sag ac ur' fnci i nott weg t e de ea h u r ud nt t e, o ts u ton s o ib he vi nc nd 12 det m i t t ut butt det ne whet t e i a ge ne i s f t al See Ander er ne he r h, o enni her her s nui s ue or ri . son,477 1 U. a 2 Thee de eoft no 3 S. t 49. vi nc he nmov nti çob beiv a alusiibl i ee ce ae a s t e le ed, nd lj tta e nfr n s r t 14 t be dr o awn i hi f n s avor.' at255. Buti t evi 'f#. f be dence oft nonm ovi pary i m er y he ng t s el l c oa eo i notsgnfc ntyprbai s 5 olrbl r s i iia l o tve,ummayj dgme ma bega e Se i.a 249 0. r u nt y rntd. e d t -5 l6 HI. A NALYSI S 1 7 A. 1 8 W ihdr t awali m andat y i t isuesi t adver y pr s or f he s n he sar oceedi r r m at i ng equie eral W ihdraw aloft Ref t he erence 1 cons der i ofnon9 i aton bankr cy f r l The ci m si t FA C r r onl t upt ede al aw. ai n he equie y he 20 i em r aton ofbankrupt 1 and sat l Ther or wihdrawali notm andat y. The nt et i cy aw t e aw. ef e, t s or 21 Courtm a wihdr t r er y t aw he ef ence,bowever tf caus s , tor e hown,'aherconsi i efi ency ' derng tci 22 ( cbi e a dwhe n c eis sprdomi t) dea a c sst tepate,u f miy whi s nh nce n on-or sue e nae, ly nd o t o b ris nior t 23 ofbankr cy adm i s r i t pr upt nit aton, he eventon off i orum s hoppi and ot r at f or ng, her el ed act s. 24 Fis ,non- e i uesheaviy pr rt cor ss l edom i e. Ei oft ri causesofacton ar nat ght he tne i e 25 com m on l contactort tcl m s. Thes contactand t tcl m sar non- e,tr at t aw r or ai e r or ai e cor 'el ed o' - page 9 of 22 ' i l , * ' 1 camsov rwbibt dititc ur ha j idi i t r28U. C.1 ( b whc t li e c he src o t s urs cton mde S. 334b) ut ib be 2 bankrupt courtcannottnaly det m i beca t ar notcr ed ordet m i by Til 1l cy i l er ne use bey e eat er ned te 3 a a e n a i s r tve ba kr pty m a t r . I r f'-ptr As o s , F. a 1 nd r ot dm ni ta i n u c te s See n e cç ?' s c . 935 2d t 07* 77. / / 4 Onl one causeofactt çars under't bankr c code t cl m f t noverofpr t y im s ies ' be upty - he ai or ur opery 5 pu s ntt llU. C. 5 - a Loomi a gu t tt scam i i ald, c us Pli tfs r ua o S. j 42 nd s r es ha hi li s nv i be a e a n if 6 seek t f ce a t rd pary t t n overpr t t t do notown. Loom i cor ecty not t o or bi t o ur opery hat hey s r l es hat 7 alhougb abankrupt courthast powert det mi whehe pr t bel t cy he o er ne t r opery ongst a de orand o bt 8 t f ce a t r par y t t n s pr t overt t bankrupt esat pr t owed t butnot o or hid t o ur uch opery o he cy t e, oper y o 9 owne b t de o i nots j c t at r ve pr e di unde 9 5 Se I r Kicai 9l d y he bt r s ub e t o u no r oc e ng r 42. e n e n d, 7 1 F.d l 6 l1 4-65( bCi.1 ) TheNi hCic tssae nto t sis i fil cl r 0 2 1 2, 6 9t r 990. nt rui' ttme n hi sue s ary ea. 11 n e fr tc us o a ton a t m pt t r c tt b e c ofco r c a t tc a m s a a is a e f c i te s o e as he r a h nta t nd or l i s 1 c oldae hy i cam frtr ve ofprpet unde 5 l i cla fom t FAC t t 2 ons i td, brd li o u no r o ry r 42. ts e r r he ba 1 Pl ntfsdo notseek tl t ansf ofany pr t t ow n,butr bers dam ages i conlact 3 ai if le r er opery hey at eek n 1 a t t Unls a untlPli if obti aj gme i t i fvo,t s a 4 nd or. es nd i antfs an ud ntn her a r hee mount donote n s ve 1 con ttt aj 5 siue udgme d btmuc ls pr rys j c t tr e t rj5 Fu temor, nt e , h es opet ube to unov r mde 42. rh r e l6 sever oft cl m sar i entonalt t t coul pot i l s al he ai e nt i ors hat d entaly uppoM punii dam agesf r tve a 1 a vet v u o t pr pe t s ug i t 95 mr ove cam , ve i t tcam wee 7 bo he ale f he o ry o ht n he 42 n r li e n f ha li r 1 l gii a e. The tr tf c o t r f r we g ve y he viy i f voro w ib a . 8 e tm t i s a t r he e o e i hs r a i n a f t dr wal 1 9 Second,t Courts decii t wihdr t r e ence w ilsave tm e a m oney, he ' son o t aw he ef r l i nd 2 be a e nea l a 1oft e cl i si t a e s r pr e ng a e n c e a wil ve t be 0 c us ry l h a m n be dv r a y oce di r on- or nd l ha o 2 1 fnaly det m i de novo by t Cour afera s i l er ned he t t econd r ound ofbrefng i r i n esponse t t o be 22 bankrupt cour ' evenm alr cy ts ecomm endaton. Tbid,t unior iy ofbanknl cy i r he f m t pt 23 a m i sr ton i noth viy i plc t d. A n f urh,t r i no i c ton off u s ppi d ni ta i s ea l m i a e d o t he e s ndi a i or m bo ng. 24 Albough m andat y wihdr t or t awaldoesnotappl t f or wei heaviy i f y, he act s gh l n avorofper i i m ssve 25 w ihdr t awal . Page 1 of 22 0 I 1 ' Pli if i t i ç mie Re po e'saet tt ydonotobe tt wih a l antfs n bers td s ns ' tt ha he Li j c o tdrwa 2 ç ovi d,h ve,t t()a1pa t c e t t j idito ofteDititCou ta a e ' de owe r ha a I ri onsnto he urs cin h src r nd gre pr es i I 3 t tt a raypr ee i ma beflya fnal aj di tdi t Diti Cou ta () ha he dvesr oc dng y ul nd i ly du cae n he srct r, nd b ! 4 ca ii aton i pr vi d a t t e e t whib t r e e ewil wihd a 't e p. lrtc i s o de s o he xtnt o c he efr nc l be t r wn. ' s 'R 5 2:9-21 ECFNo. . 1 , 2) 6 The Cou t n s ts y t e s c d c dii s m pl by notng t tt e ie a e s r c s r ca a i f h e on on ton i y i ha be ntr dv r a y a e 7 wil ewi da .Th irt o dt niu cerb t p er t b stsid.Frttep ris lb t rwn e isc n io s n la u a p aso e aife is,h ate h i 8 ne dno c nsntt s j c matrj iditon.Su jc matrj idito i t po rofac ur e t o e o ube t te urs ci be t te urs cin s he we o t 9 t heart m aterbef e i. l eiherexit asa m a t ofl w ori doesnot ' her i doesnot o he t or t t t ss ter a t .W e t ) e stt pa te cnno ce t ibyc ns nt l e ssi t sc eund r28U. C.j1 4.I i i 0 xi ,he ris a t rae t o e . t xit n hi as e S. 33 ts n 11 fc t dititc tis l t tha orgi j rs ci ov ra1ba u c matr.The a t he src our tef ha s i naluiditon e l nkrpty tes 12 ba upt courti an ar oft diti cour t w hi m ostm atersi ba upt ar nkr cy s m he sz ct to ch t n nkr cy e 13 a om atcaly r ered;bence,t pr entm oton t wihdr t r er ut i l ef r he es i o t aw be ef ence. 1 4 Se nd, r psPli if me np ro j rs ci ButPli if ne dno c ton co peha antfs a es na!u iditon. antfs e t ondii l t ia quis e et t prs n moto o Defnda s s si t i pes m j iditon. 5 her c e c nc o be e e t in n e nt' ubmison o n rona urs ci 1 Defnda sha s bmitdt i peron m jus cina amate o 1w b jln teprsnt 6 e nt ve u te o n s a tidito s tr f a y iig b ee 17 m oton wih t Court whi actcons iut a gener appe ance- t sa not ng of i t he ch tt ed al ar o y hi 1 D e e a s'a a a e i t ba knl t y c t 8 f nd nt ppe r nc s n he n p c our. l 9 Thid, r psPli if me nt syt tt ydonoto j c t wihdr ( r peha antfs a o a ha he b e to t awalnot 20 t rs cton' inoot rpat obe t.l hi i wha Pli if me n,hec dii i stsid juidi i ') f he ry j cs ft s s t antfs a t on ton s aife 21 becauset tm e t r pond t t pr be i o es o he esentm oton has l e r and t nonm ovi i ong xpied, he ng 22 Defnda s I ucop.a dAI LieI . , veno obe tdt i. e nt,ns r r n G f ns Co.ha t jce o t 23 - B. Sum m ar Judgm ent y 24 Loom i pr nci l ar s i paly gues t Her tcannothave r i on anyt ng Loom i r es ed hat bs eled hi s epr ent 25 wih r pectt t polcy negotatonsort quot i pr ded,becaus H er tdi noteven t es o he i ii he es t ovi e bs d Page l1of 22 I , l know t Loom i waspr di l com is quot Butt de ton ofN i asM a t hat s ovi ng nsur t es. he posii chol thew 2 Os , h V i e Pr s de to Hum a Re ou c s f He bs i c t s c nta y t Loo i ' a te c e i n f n s r e or r t ndi a e , o r r o m s . ' 3 r esent i oft t tm ony,t tO s wasf l awar ofLoom i r e i asss i I trcom epr atons hat es i ha a uly e s' ol n itng nsl 4 wibobti ngi sza c quotsf rHebs.( eOs De 78:4-1 ,J 4, 0, No. t ani n tr n e e o r t Se a p. 1 8 une 201 ECF 8 5 Ex.A) Eve i Hebs ha h dnoi aLoo swa povi ngt quoe t I uror t t . nf r t d a de mi s r di he ts o ns c p ha 6 l lcor w assubs nstr p equenty pr di t Her ,Her tstl coul ha r i on Loom i l ovi ng o bst bs il d ve eled s' 7 r es atons becausea pl ntf ay r y on st em ent m a i r l t hi .I r Am. epr ent i , ai ifm el at s de ndiecty o m n e 8 Co 1Cor / ic nSav (: oanSe . ii ,79 F. nt p.L n ol .fL c L tg. 4 Supp.1 24,1 5( Arz.1 (tndie 4 46 D. i 992) d rct i 9 r lan ema b s wni apr f s i lne lg nc c s whe epur hm e sa et f r s e bl e i c y e ho n o e sona g ie e a e r c s r r he o e e a e I I l rcpint o adec a ' wor '; f v isttCtr ,75 A. l 88,11 ( J 2000 0 e i e s f fnd nts k.)Kauman .- a )#. 4 2d 1 ' 95 N.. ) 11 (tn r c r la c al apli ift pr veafa a to whe h ors he r asaeme not ' die t e in e lows antf o o l r ud c in n e he a d tt nt 1 f' t pary t defauded hi orherbutfom t pary' agentor9om s eone t whom 2 zom he t hat r m r hat t s om o I 13 t pary com m uni ed t f se sat entw ih t i enton t t vi i heari,r y on i, he t cat he al t em t he nt i hat he ctm t el t . 1 an a tt hi o he derme .l s as Belv Camer M e dowsLa Co , F.d 1 4 d c o s r r ti nt' ; ee lo l . ' on a nd . 669 2 278, l I 1 1 -8 ( bCi.1 )(e ri adititc tsgrntofs 5 283 4 9t r 982 rvesng src our' a ummayj r udgme onafd rl nt e ea 1 s c iisfa cam wh r pli if s we aque tonofmae ilf c a t i iec r la e ; 6 e urte r ud li e e antfs ho d si tra a t s o nd r t einc l l Bl kev Bar ac ,52 F.d 89l 907( t Ci.1 5)(ppr vi t i rctr la et or i 7 ac i . r k 4 2 , 9 h r 97 a o ng he ndie einc he y n : l 1 t sc ii fa dc e ) Alho t Ne d Su e Cou t snota e rt ha 8 he e urtes ru ontxt. t ugh he va a prme r doe pp a o ve I 1 a r s e t is ,t Ca io i Supr m e Cour ha a o d t e t o y: 9 dd e s d he s ue he lf m a e t s ppr ve h he r I 20 ( dee da ' mirprsnt i ma bea lmme aeca e'ofapli ifs A) fn nts se ee aton y n e dit us' i antf ij r od n c c e n t ugh t d e nt di n ma t nuppr ucig ondu t ve ho he efnda d ot ke he 21 . ' m ir es aton diecty t t pl ntf,and eve t s epr ent i r l o he ai if n hough t pl ntf neverhear he ai if d orr t pr s wor oft m ir esent i ead he ecie ds he s epr aton. 22 TheRes at entSecond ofTorssat t prnci e ofi r r i t em t t es he i pl ndiect elancet s hi 2 3 wa :t e ma e o a fad ln mirprsnain i s jc t l bl fr y t n k r f ru ue t se ee tt s ubet o i ii o o a y pe unir I s t a he wbo a t i j siibl rlanc u c ay os o not r cs n u tfa e ei e pon i l te t f h 24 m ir es aton,albough notm ade diecty t t ot i m ade t a t r per on s epr ent i t r l o he her, s o hid s and t m akeri endsorhasr he nt eason t expe t is t m s wilbe r o ct hat t er l epeat oris ed t 25 s tncec ubsa ommuniae t t ot r a t a i wilnfue ehi E he !c c td o be he , nd h t t l i l nc s or r onduc t i t ta s c i ort ofta a ton i ol d. ( s. Tors j53 ) n he r n a ton ype r ns c i nv ve ' Re t2d t, 3. ' Page l2 of 22 l i ! ! r ! . ! ' 1 2 Consit wih t Res at entpos ton,t scourthasl r sent t he t em ii hi ong ecogni t zed hat ar pr s a i m a bea to bl e en t ugh i wa not a die ty t t p r y e e ent ton y c i na e v ho t s m de r c l o he a t s ng r eeki ecover y. 3 Miknv Was r 2 Ca. r2d1 ,11 (993 * e alo37Am. u . Fr dJn r i . se man, 3 lRpt. 01 9 1 ) s e s , J r 2d au # 4 De et2 ( 0) c i 40 201 . 5 1 . Tur rofPr ryt t EsaeUnde 11U. C. 5 nove ope t o he tt r S. j 42 6 Asdi sed,su scus pra,t e i no vald cl m f t a eri t s cas n e ot rcl m sar ber s i ai or r nsf n hi e. he ai e 7 aI c ta t ort tbas d, nd t c a m f ta f r i i r nty p e c t d o t t or t t 1 on r c - or- e a he l i or r ns e s nhe e l r di a e n he he y ba 8 Pli if t 'ap e ilf uej antfs ' own' otnta utr udgme ono ormoeoft eot rcli .Pli if nt ne r hos be ams antfs 9 c rntyha enovetdrghti t vaueofa s hpotntaj dgme ,a e ni e nt ly ure l v se i n he l ny uc e ilu nt nd ve f ve ual 1 obt ne s baj dpne wil rl c si ead btnotpopet owne byPli if t t 0 ai d, uc u nt lmeey on tmt e , r ry d antfs ba . ll wo dbeta frbl un rj5 See17r Ki ai 91 F. a 1 6 ul rnsea e de ' 42. c nc d, 7 2d t 1 4-65.TheCou'ga s l rnt t 1 s 2 ummayj r udgme o tl Grtc us o a ton. nt n le s a e f ci 1 3 2. ! i ' Pr f s i nal e i nc o e s o N glge e 1 1 4 Th ee nsofaca eofa to i t tfrpofsi lne lge eae: l e lme t us cin n or o r e sona gi nc r () t dut of t pr essonalt us s he y he of i o e ucb skil pr l, udence,and dii lgence as ot her 1 5 1 6 me r ofhi pr esonc mbes s ofsi ommo ypo ss a e r s ( t bra hoft t nl se s nd xecie;2) he e c ha dut ()apr mae c uslc nn cin bewe n t ne ie co uc a d t y; 3 oxi t a a o e to t e he glg nt nd t n he rs tng ij l a ( a t lls orda g r uli 9o t pr eso ls euli nuy nd 4) cua o s ma e es tng m he ofsina' neglgence. i 17 ' ' Sor n onv Paviows ,5 lP.d851 853( v.1 )(ii Pr s r T Law o t 930, e s . lk ki 8 2 , Ne 978 ctng ose, he fTors . h' l8 atl ( h e 1 ) #u v Nàe ,49IP. 433( I 1 71 ) 43 4t d. 971 * ## . n , 2d Ca. 9 ). 19 . ' Pli if a lg t y we eda g d b ( )l ur om ' pr e so ne i nc i antfj le e he r ma e y: 1 ns c s ofs inal glge e n 20 c ommuniaigwibPli if a nc otai o t i b hafa ()Loomi'untmeya c tn t antfs nd g itng n her e l; nd 2 s i l nd 21 i naccur e pr at ocessi ofPl ntfs'cl m sundert Polci and f l e t notf Pl ntff t i ng ai if ai he i es aiur o iy ai i s hat t 22 ddn' beiv t y h a e t i o to c e ni t Polcis a nita in.( i t le e he ad d quae nf nna in onc r ng he i e ' dmi sr to FAC 23 j 66 ) Pl ntfsfrhe alget tA1 i Ia ef t ne i nc ofLo s bec s ! -67. ai if u t r le ba G s ibl or he glge e omi, au e 24 Loomi wa aci asA1 Sa nt(d.l ) s s tng G' ge .l j68 . 25 Loom i ar s gues t Pl ntf hasnotes ablshed t Löom i owed any dut i a hat ai if t i hat s yn Pa l of 22 ge 3 ! ; ( . ' I i I 1 ; i 1 pr e sona c pa iy, ca et r wasnoc rc be e nHebs a dLoomi. eWar r ofs i l a ct be us bee onta t - e r t n s Se mb odt 2 v Bl ch d,69 P. 1 2,1 ( v.1 4)( fr ngs . an ar 2 2d 28 285 Ne 98 afimi ummayj gme o apr e so l r ud nt n ofs ina 3 m al actce cl m wher t ewasno i s ofm at i f t no contactexi ed behveen t pr i ai e her s ue eral act hat r st he 4 pli ifa t de e nt (t i t c r c lr ltons p c e tngadut ofduec eupo a antf nd be f nda ) tt s he onta ma eai hi r ai I . y ar n n 5 atr yg i i)t prmayesnta t arc r f lga maprcie . ,nt a e eof tone whch s he i r se ilo e ovey or e l l a tc . . l be bsnc 6 a contact dut t pl ntf st peror t actwhi pl ntf saleged as aca oft r r ual y o ai if o f m he ch ai if l use hei 7 dam ages,t courtcoul pr l Gnd t t e wasno genui isueofm at i f .' he d opery hat her ne s eral act' 8 ( ttonsa i enal ai malso te ) ciai nd ntr quotton rt mitdl. 9 Her i i notdi put t H er had no contactw i. Loom i w ih r pectt t e, t s s ed hat bst r t h s t es o he 10 negotaton oft Polci Ther wasalegedl a contactt admi sert Poici but ii be i es. e l y r o ni t hc i es, 11 Pl ntf sdo notalege'm pr ai if l i operadm i s r i oft Polci . They alegeprc nitaton he i es l wer 12 adm i sr i ofpolci t had been neglgenty orfaudul l negotat n eCour nitaton i es hat i l r enty i ed. t 1 t rfr grnt s 3 heeoe a s ummayj r udgme tt Loo sont sc us ofa ton. n o mi hi a e ci 14 3. Breach of Cont ract 1 5 Pl ntfsalege t i ur p br ai if l hat ns cor eached an or agr entçt negotat and m anage al eem 4o ie 1 Pl ntf s'em pl 6 ai if oyee healh i ance beneft polci 'because i f l t negotat t polci t nsur is i es' t aied o i e he i es 17 i accor n dance w ih Pl ntf s's fcatons,com m uni e m at i changest t Polci and t ai if pecii i cat eral o he i es, l pr e l rviw t Polcisprort Pli if'e c i oft m t e ur a c ac ( 8 op ry e e he i e i o antfs xe uton he o ns e cur y.FAC 1 ! 7 76 .Mov t,Loomi,aenoti iae byti c us ofa ton. 9 ! 4, ) ans s r mplc td hs a e ci 20 4. M i repres aton and Conceal ent s ent i m 21 Pli if a lg bot i e i lmir pr s n ai ( mmon 1w fau a ne i nt antfs le e b ntntona se e e t ton co a r d) nd glge 22 m ir esent ton. Nevada' punii dam ages sat e i udesSconceal ent'undert s epr ai s tve t ut ncl t m ' he 23 dei tonoffau S .t? 'v''Sulv 1 P. 433, 1( 200 ( tngNe Re fnii z d. eel/p ( l1 lian, 38 3d 45 Nev. 6) cii v. v. ? gi? . 24 St t j42.012 ) a. ' 0 ( ). 25 // / Page 1 of 22 4 . . I i I I l entonalM i nt i srepr esent i aton . 1 a. 2 The e e e sofi en i al i r pr s nt ton i N e d a e: l m nt nt ton m s e e e a i n va a r 3 1. A f s r esent i m adeby t def nt al e epr aton he enda ; 4 2.Dee da ' kno e georbeift tt rpr e ttoni fle( i ufi e fn nts wld le ha he e esnai s as or ns fcint b i f ma n t rpr e ai ; ass or kig he e es nttonl 5 6 3. D ef endantsi enton t i ' nt i o nduce t pl ntf t actort r r n fom actng i be ai if o o ef ai r i n ri elance upon t m ir es ton; he s epr enu i 7 4.Pli ifsj tfa er la eu temirpr e ai a antf' usiibl einc pon h se esntton; nd 8 5. D am age t t pl ntf r uli f om s r i o be ai if es tng r uch elance. 9 Bulma ui . . v Bel 8 P. 588 5 ( v.1 ) Unde Rul 90,, ic tnc s b n,f c v Ne . l, 25 2d , 92 Ne 992 . ? r e ) cr umsa e 1 c tmtngfa ormitkemus besae wihpatcuaiy Fe R. v. 9 n i ha 0 onsi i r ud sa t ttd t ri lrt. d. Ci P. 08. s s 11 be n c ns r ed t r qu r a pl i ift t t t pr c s l t tm e, a e a nat r oft e o tu o e ie antf o t a e e i ey he i pl c nd u e he s 1 m i eadi st em ent m ir es atons and s fc ac sofFaud.'Kapl v.Rose,49 F. 2 sl ng at s, s epr ent i pecii t ' an 3d 1 1 3,1 70( hCi.1 4) A plitf mus pladfcss hast bo htahous 9o 3 36 3 9t r 99 . anif t e a t uc t ug he e m 1 def 4 endant t t def , bat be endantas ed hi t i wasi pe ects pe,and t i f t house sur m hat t n rf ha bat n act he l mr doutt beb l onaIndfl .... Wa s v Xoma Cog ,7 F. 9 960( h Ci 5 ne o uit a il ' r haw . ' r 4 3d 55, 9t r l l )( otn l r GlnFe I c Se . tg.42F. 1 4l 1 48( hCi.1 )(nba c) 6 996 qu ig n e e d, n . c Lii , 3d 5 , 5 9t r 994 e n l. 17 Thepl ntf m ustal tsetf t an expl i ast w by t s at entorom i i com pl ned ai if so t orh anaton o he t em ss on ai 1 ofwa f lea m iia ng. ,7r Gln d Se . t , F. a 1 48.Asdic s d,Lo i' 8 s a s nd se di ' J c e Fe c Lil 42 3d t 5 '? f s us e om s 1 la lt on mi r pr s nt i cl i s i no pr c ude m e e y b vim e oft f c t tH e bs ' 9 i biiy s e e e aton a m s t e l d r l y l ' he a t ha r ts 20 r i n e on Loom i 'ale d m i r pr t a i wa i r c ,s l a Loom i kne is ela c s l ge s e es nt tons s ndie t o ong s s w t 21 sat ent woul be r i on a t r pary. t em s d eled hid t 2 2 Pl ntfsalg ta AI a Loomi, A1 sa nt( )itnton l c c e t ai if le e h t G nd s as G' ge : 1 ne i aly onc ald hat 23 Loom i ha f ie t tm e y a c pl t l p oc s t pa m e ofa 1c a m sdu unde t e s d a l d o i l nd om c e y r e s he y nt 1 l i e rh 24 Polce '2)i e i lycon e e ta t te rt icr s'Loo sprmie frt 2008 iis ( ntntonal c ald h t he ç velae n eae' mi o s d o he , l 25 Poiyiclde onl txe c t a no a e t cai c t;( afimaieymirpesntd lc n u d y i d oss nd t ggrgae l ms oss 3) tr tv l se r e e Page l of 22 5 . . . E i ! ! : ! 1 t tt 200 Polc wa f r 1 m ont / 5 m ont c r g a c t i d pr s i ton c r ge i ha he 7 iy s o 2 hl h ove a e nd on a ne e crp i ove a n 2 b bt s cii a dt a gae; nd( afnnai l mirprs ntdt tt 2 Polc ot he pe fc n he gre t a 4) fi tvey se e e e ha be 008 iy m i it he 3 woul noti eas Pl ntfs't alcoss, ie. t Pl ntf s'm axi um labiiy undert 2008 d ncr e ai i f ot t . , hat ai if ' . 4 Plnwoul be$2350, ( ll1 -06) a d , 000.FAC l 04 . ! 5 Loom i a gu s t tM r Os He bs ' V i e Pr s de ofHum a Re our e , i e t s r e ha . a, r ts c e i nt n s e s s gn d be 6 2007 Polc w ihou r a i g i,a t the r le s l y on l ur o ,who pr s n e t e w rte i y t t e d n t nd ha e i d o el ns c m e e t d h it n 7 doc ntt hi Loomi ague tEl mo tLoomi rprs tdt tiwa a et manant ume o m. s r sçat s, s e eene ha t s bl o iti he i 8 ref t Pli. vnhnii niuett ep vu)as e t sm.( t aso h ocsEet , s dpt h t (eisrewr h ae' . t r e ie e t u s d ah r o t e e 'Mo ' j 9 Su J 21: -28 ECFNo.8) A pli i srla eonsae nsmus bej tfa et mm. . 27 , . antm einc ttme t t usiibl o ' 1 s ppor a c a m f fa H e e,i i notd s e t atLoom i 'r pr s t to t Pl n if we e 0 u t l i or r ud. r t s i put d h s e e en a i ns o ai tf s r I 11 i r ,and t l ur ndiect hat ns com deal diecty wih Pl ntfsand pr t r l t ai if esent t docum ent f si ng. ed be s or gni 1 n er i a ques i off ast wbet H er ' r i 2 es ton act o her bsts elanceon I tr ' r pr ent i up t ns tcom s e es atons o 1 a i ldi t mo nt sglngweej siibl wbe Hebs, s pbitc c a tr ha t 3 nd ncu ng he me of i i r u tfa e n r ta o siatd co, d he l4 wrten contacti fr ofi when i s gned and t contacti uded m at i t m sdif nt it n ont t ti hat r ncl eral er fere 1 fo wha h dbe nprvi l a e d.A raona ej yc l deemi t tHebsj tfa y 5 rm t a e e ousy gre e s bl ur oud tr ne ha r tusiibl l 6 r i on i ur p' s a em ent atsi ng st em ent s astt sconeactyou ar aboutt eled ns cor s t t s gni at s uch thi e o 1 sgnco ai t tr prvi l a e dt ' A ra o bl ur c das fit fn j tfa e 7 i nt ns he ems e ousy gre o. e s na ej y oul lo alo id usiibl ' 18 r i elance undert hese cicum sances. r t 19 A lhough t e i no alegaton t a Loom i r es atve everm ade any such t her s l i bat s epr ent i 20 sat ent Her taleges t i si d t agr m ent underas ptonsbas on t em , bs l hat t gne he ee s sum i ed 2 1 r es atonsm ade t i f om I ur p t orgi ed w ih Loom i . Her talo alegest cpr ent i o t r ns cor hat i nat t s bs s l hat 22 Loom i knew t e was an er ori t wrten contactand t i afi s her r n he it r hat t tnnatvel conceal t s i y ed hi 23 fc fom Hebs.A raona ej yc dfndt tHebs idie tya usiibl rle ont atr r t e s bl ur oul i ha r t n rcl ndj tfa y eid he 24 a fnna i sa e en sm a by Loom i co e ni t e t nns o t 2007 Polc a t t f i tve t t m t de s nc r ng h e f he i y, nd ha 25 alhough onl l ur t y ns com af i i y m ir es ed t cont soft 2007 polcy atsgni fnnatvel s epr ent he ent he i i ng, Page 16 of 22 1 1 Loom i i entonaly conceal fom i ur p and H er t f t t wrten polcy s nt i l ed r ns cor bst he act bat he it i 2 dif ed fom t pr ousquot i gave t l ur p f t useoft r par i s asHer t f er r he evi et o ns cor or he hid tes ucb bs . 3 Ther r ai a ques i off ast w het I ur p,Loom i orbot ar labl f e em ns ton act o her ns cor s, h e i e or 4 i e ina mirpr e ai Loomi ha notme isbude ons ntnto l se esntton. s s tt r n ummayj gme tt s w a r ud n o ho 5 l ck ofam at i ques i off on t spoi . l si y ar a eral ton act hi nt t mpl gues t is i vem entwas hat t nvol 6 idie twhihi ofnoi or,a t tMr Os c nno ha j tfa yrledonrprsntton n rc, c s mp t nd ha . a a t ve usiibl ei e ee ai s 7 t he woul have known wer f s had he r t agr ent bef e sgni t ,wbi i a hat d e ale ead he eem s or i ng hem ch s 8 que to offc.TheCou t niss sin a t r de e ummayj gme ont sc us ofa ton. r ud nt hi a e ci 9 1 0 b. N eglgentM i i srepresent i aton Thet tofne i nt se ee ai i Ne dai dei dbyt Resae nt( co or glge mirprsntton n va s fne he ttme Se nd) l1 ofTors: t 1 2 l BilSte lMot s, n v Fis Nat Ba o v 94Ne 1 1 n l rmme or I c. . rt ' nk fNe ada, l v. 3 , 1 4, 5P. 938, 0(97 , a optdt Resae n ( c ofTorsj55 3 57 2d 94 1 8)we d e he ttme t Se ond) t 2 13 def ii oft t ofneglgentm i e esent i m ton he ort i sr pr aton: ( )Onewho>i t ec reofh sbusne s pr e son o e oy nt o i 1 n l ou s l i i s > of s i r mpl me , r n any ot acton i whi he has a pecuni r i er t s i f s her i n cb a y nt es , upples al e i or aton f t gui nf m i or he dance of ot s i t r busness tans i her n hei i r actons, i s 15 s be tt la lt f pe unir l sc usd t t m b tei j tta e u jc o ibiiy or c ay os a e o he y h r usiibl r la e up t i f m a i i he f l t exe cie r a o bl c r or e i nc on he n or ton, f ais o r s e s na e a e c pe e e i o ai ng o c m un c tng t i f m a i om t nc n bt ni r om i a i be n or ton. Bar tlrv Re oAi, n 956P. 1 1 t v.1 8)(uotngResae nt( c nd)of mete . n rl c, 2d 382, 387 ' Ne 99 q i ttme Se o Tors(552( ).Onefdeaj ge rlngonacaefom t sDititha en rtdt t ' 1) e rlud , ui s r hi src, s umeae he el ent . em s' 1 arprsnttont ti fle 2 t tterprsnttonwasma i t c zs ) e ee ai ha s as ; ) ha h e ee ai de n he otre 21 oft def he endants busi sori any acton i whi hehasa pecuni y i er t ' nes n i n ch ar nt es ' , 3)t r pr s nttonwasf rt guia ofo h si t i busne sta s ci ; be e e e a i o he d nce t er n ber i s r n a tons 4)t rprsnt i wasj tfa yrle upo 5 t ts hrla ers tdi he e e e aton usiibl eid n; ) ha uc einc eule n pe unir I st t r yi pa t a d 6)t tt de e da f ie t e r s c a y os o he el ng ry; n ha he f n nt ald o xecie 23 r easonabl car orcom pet e e ence i obt ni orcom m uni i t i onnaton. n ai ng catng be nf i 2 G. fa Ve Lt P 'hi 1 Si . wp.Gl .J?.460 F.Su 2d 1 4 #. s gas d. s p J mon P? . p. ?c, pp. 246,1 2 ( Nev 26 D. . 25 20 ( a, ..Ne ie mir rs nai mus as bepldwihpa-culrt Fe R. v. 06) Ezr J) glg nt sepe e tton t lo e t li a iy. d. Ci t Page l7 of 22 . ' . l P.9( . b) 2 Pl ntf sa l ge l ur or a Loom i ha ape u a y i t r s i t Polc e a ai if le ns c p nd s d c ni r n e e t n be i i s nd 3 br a he t i du@ t obai a c e c d her o t n nd ommu c eac u at i or ton a utt Po iist niat c r e nf mai bo he lce o 4 Pli if.FAC !18 -81.Pli if f rhe ale eta AI i la ef t n glg nc of antfs ( , 0 ) antfs ut r lg h t G s ibl or bc e ie e 5 Loomi, c us Loomi wa a tngasA1 sa nt(d. 8 .Fortes mermonst Co t s be a e s s ci G' ge .1 ! 2) h a e s he ur 6 de e s nis ummayj gme ont fa dcai ide isiont scai r ud nt he ru l m,t ne t hi l m. 7 5. Br each ofFi ary D ut and TortousBreach oft Im pled C ovenantof duci y i he i G ood Faih and Fai D ealng t r i 8 Eve? contactgi rse t a dut nott actar tarl orunf ry t t det i entoft y r ves i o y o bir iy ail o he rm be 9 ot rpat Nes v He r 1 P. 420, ( 200 .Bra ho t sduyi atl difrnt he ry. lon . e , 63 3d 427 Nev. 7) e c f bi t s o4 fee 10 i nauefom acam f bra hofc rctSe I .Co.ft Wetv Gi onTieCo.I . n tr r li or e c onta . e ns o he s . bs r ,nc, 11 1 4 P.d 698, 2 t e 20 .A ba f ih cam i pr diatdon t a us ofatduca y 3 3 70 ' v. 06) N d at li s e c e he b e i ir 1 2 r atonshi e s i bet el i p xitng ween pa i t cert n ki ofcontact i doesnotarse sm pl f om a rtes o ai nds r s; t i i yr l3 pari ary er egi orw ilulbr tcul l ous lf eacb ofa contact asltgant oft i pl by r l vel r , ii s en m y etexi y 1 4 pl adi ba f ih a o w ih ne ry e r br a ofc nlac c a m : e ng d a t l ng t a l ve y e ch o z t l i 15 1 6 Alhoug e r con r c c nt i sa i ple c na tofg d f ih a d f i de lng, t h ve y ta t o a n n m i d ove n oo a t n a r a i a a ton i t t o br a h of heco na ta ie on y t n r r an e e i l s s' n c i n or f r e c t ve n rs s l t a e d xc ptona ca e ' i when t r i a s alr atonshi bet he e s peci el i p ween t vi i and t f or A s al he ctm orteas . peci 1 7 rlt n hgit h rceie b ee n s f u i itr s, d t i ,n td cay eai s i s s aa trz d y lme t o p bl nee ta h son a d i u ir o c c 1 8 i ur ds pa t r ofpa e s ps a ga hie sa fa hie s Ea h oft s ns e , rne s c r hi , nd nc s e nd rnc s r . c he c r ponsbily.'Exam pl ofs al el i es i lt ' es peci r atonshi i udet ebenveeni ur sand ps ncl bos ns er r ai el tonshi s es ta s al el ent of r i ps har t peci em elance' com m on t part shi ' o ner p, l 9 20 21 is rn e a dfa c iea re ns W eh v rc g ie ta i te esmain n ua c , n rn hs je me t. a e e o nz d h t n b s i t s o i vi a e e e o r la c t r i ane d t x ot c t e we k fom t i uls nvol ng n l m nt f e l n e,he e s e o ç e t h a r he ns t pr oft s r he tonger'hati notadequat ym etbyor nar 't s el di ycontactdam ages.I addii r n ton, w e have ext ended t t tr edy t ce ai siuatons i whi one pa y hol he or em o rt n t i n ch rt ds çvasl s i bar ni pow er' ' ty uperor gai ng .' 22 I (oomotsomitd) Th W a bigt SupemeCou'ba smial de ci dt badf t d. f e te . e s n on r z s i lry szbe he aih t 23 t ta tt i e to a eofa fdu a y r a i hi 'K ik v M t z ïi I .Co. 951 P. or s 'he nt n i nal bus i ci r el tons p. r . . ' r' ns ' lk , 2d 24 l1 1 26( a h.1 ) Ac or ngl t mos co 24, 1 W s 998. c di y,he t mmona da o it tresofba fih n pprprae ag t d at 25 camsaei urr. e eg.Alsat /7.Co. .Mil '2l P. 31 3 t e 20 . li r ns esSe . . , lt e /N v lel 2 3d 8, 24 ' v. 09) . , N Pa e 1 o 22 g 8 f j : i i ! I I j p i 1 Pl ntfs alege l tr ai if l ns lcom owed t hem a fducir dut ast rbr i a y y hei okerand agenti n 2 a sng, negotatng,and m anagi t Polci ,t Loom i owed t a fduci y dut asa dvii ii ng he i es hat s hem i ar y 3 t r -pa t a n sr t ,a t tAI owe atdu ir d y a t ei i ur rb h die tya hid ry dmi itaor nd ba G ' d i ca y ut s b r ns e ot r c l nd . ' 4 tr h isi ur nc a e , mi.( ! 87 .Pli if a gu t t fc sal ed h oua t ns a e q nt Loo s FAC ! -90) antfs r e hat he a t leg ' ' ' ' . 5 c nsi ebra he ofalDee ns td ir d is (d.I91.Pli if aloaguet tAI o tmt e c s l fnda t i ucay ute.I J ) antfs s r ha G 6 a l Lo i, asAI , a nt we e i a s perorortu t d poston w ih r s c t Pl i if a fd om s G s ge , r n u i r se ii t e pe t o a ntf s nd . 7 br a he t i du i ofgood f t by e g ng i t e a t de aie i t FA C, pec fc lyz e c d he r tes ai h nga i n h c s t l d n he s ii a l by 8 9 ' ma ngmae ilmirprsntto a omisons (d. l1 6-1 . ki tra se ee ains nd si .1 j! 1 9) . Pli if ba s fiîntyale d ti cli asa i tAI t s r i amoton t antfs ve u fc e l 1ge b s am gans G o u vve i o 10 dim i s. n ey speciicaly alege t A1 was t ri er and t Loom i who m ade cerai s s t l l hat G bei nsur , hat s, tn 11 m i e esent i t Pl ntf s wasA 1 ' agent They al alege t Loom i isel was a sr pr atons o ai if , Gs . so l hat st f 1 f duci y because i wast t r pary adm i sr oroft Polci A I and l urcom 2 i ar t he hid- t ni tat he i es. G ns 1 pl bl br 3 ausi y eached t rdut ofgood f t by pr ntng f executon a polcy t di not àei y aib ese i or i i hat d 1 r te tt e pr vi ne ota i ns w ibou m a n t sf ct ns c ous y k wn be o e 4 e l c b e ous g i to , t t ki g hi a co pi u l no fr 15 executon,and t f lng vol arl t r or t coneactt r l t orgi i entoft i hen aii unt iy o ef m he o efect he i nal nt he 1 pa- e . 6 lis t 1 7 Loom i asa mer pl adm i stat ,bowever wasa fduci y onl w ih r s e an ni r or , i az y t espectt o l ad i s r i o t Polc e ie. t pa e to de i lofcl i s t Pl ntfs 8 m nit aton f he i i s . , he ym n r n a a m o ai i f ' l e pl e s n ne i i n and cx u / n oft m . Pl i if d nota l ge a y da a vi t e 9 m oy e ot gotato -cc lo he a ntf s o le n m ge a h 20 a m i sr to ofcl i su e t t xtoft e polc e as wr te buto y vi t ne i ton a d nita i n a m nd r he e h iis it n, nl a he gota i nd 21 executon oft polci bcf e t w enti o efcct l ot wor ,Pl ntf salege dam age i he i es or hey nt f . n her ds ai if l 22 r uli fom t es tng r heprw c a m i sr to oft e Polc es polc e t a d d notpr ry r l tt t r d nita i n h ii iis h t i ope l efec he y 23 i e o t e pa te ort r pr s nt tonsm a by Loo i a o he s Loo i 'fdu a .ydut nt nt f h ri s be e e e a i de m s nd t r . m s i ci r 24 f t uly t adm i sert Polci di notext t Gghtng Her t sbatl w ih r aihf l o ni t he i es d end o i bs ' tes t espectt t o he 25 ve y va i t o t Polci sc ' e Alhoug Loom i m a be labl f m ir pr s nt i b e r ldiy f he i e a ant . t h s y i e or s e e e aton as d Page l of 22 9 2 1 i ! î : 1 1 on Pl i if 'i r c r la e on Loom i 's a e e s t l tr om c ce ni t polcyqu e , a ntfs ndie t e i nc s t t m nt o nszc on r ng he i ot s 2 a a t ugh t f ct h tLoomi w a alo t a m i i ta oro t Polci sm a a a a e s h a nd lho he a t a s s s he d n s r t f be i e y ggr v t uc 3 cl m ,Loom i i notlabl f bad f t ast t negotaton and executon oft polci ai ss i e or aih o he ii i he i es 4 b c s i wasno a fduc a y i t s r g r N o a e m e ,wrte orot nv s ,i a l ge t e au e t t i i r n hi e a d. gr e nt itn he i e s le d o 5 ha e s e be we n Pl i if a Lo i f ra s sa e i o ai ng c e a n i wast ve xit d t e a ntfs nd om s o s i t nc n bt ni ov r ge. s he 6 s eduyofI urop.TheCou-teeor ga sLoomi'motonf s ol t ns c r l h rf e rnt t s i or ummayj r udgme a nt s 7 agai tt ns hese caus ofacton. es i 8 6. Fraud i t lnducem ent n he 9 Pl ntfs alege Der nt pur el m ir es ed t t ai if l enda s pos y s epr ent he ennsoft Polci t i be i es o nduce 1 Pli if t e c et m b tligPli if:()t 20 Polc wa a1 mont/ smont 0 antfs o xe ut he y eln antfs 1 he 07 iy s 2 bl h 11 polc t tc rd pr s rptonsi bot t s cfca t a e ae; d ( t c ng t t iy ha ovee e c i i n h he pe ii nd he ggr g t an 2) he ha es o he 1 2 Polc w o d noti l e a i r a e i t alc t , uc t tPl i if 'la lt woul n 2 008 i y ul nc ud n nc e s n ot oss s h ha a ntf s i biiy d ot 1 e ee $2,50, 0.( M 8* 97 .ls a a t scli i me ntt beditn tfom t 3 xc d 3 00 FAC ) n ofr s hi am s a o sic r he 1 m ir pr s nt to cl i sa r a a e s d i c tt t sa d f ns t e or m e tofa c r c , 4 s e e e a i n a m te dy ddr s e , t bns iu e e e e o nf ce n onta t 1 nota s at caus ofacton,and t pr entm ovant Loom i,i notaleged t have been a 5 epar e e i he es , s s l o 1 pa t t t Po i i s buta t r pa t a m i sr t oft m ,a s l c e by t pa te i t 6 ry o he lc e , hid- ry d ni ta or he s e e t d he ri s n he 1 Polci s n e e o e t Co t e no a e st sc ai a t stm e. 7 i e . r f r , he ur ne d t ddr s bi l m t hi i 18 7. Ref at on ofContr orm i act l 9 Re onna i n ofa c ta ti a a o i t e uia e r m e y i t e ca e off a o f to on r c s n ppr pr a e q t bl e d n b s r ud r 20 m i ake. W ih r pectt faud: st t es or 21 22 l ap r sma iett no a sn i id c db teoh r a t sfa d ln f at y' nfsai f se ts n u e y h te j ry' ru ue t o m i r p e e a i n a t t co e sore f c o a wrtng e de l orembody ng s e r s nt to s o he nt nt fe t f ii vi nc ng i i whol ori par an agr ent t courtatt r n e n t eem , he he equestoft r pi m ayr or he eci ent ef m t w rtng t expr s t t ms oft agr entasass ed, he ii o es he er he eem ert 23 ()it rci en wa j tfe i rl ngont mirprsntton, nd a f he e pi t s usiid n eyi he se ee ai a 24 ( )e c t t extnrta rghsoft r pariss c a good f t pur as r f b xc pt o he c h t i t hid te u h s aih ch e s or 25 val w ilbe unf rl afect ue l ai y f ed. Page 20 of 22 I e ! ! 1 Rettme ( c )ofConea t jl ( 981; e NOLM LLC v C?..o ar 1 P. sae nt Se ond cs 66 1 )s e . 1y fcl k, 00 3d / 2 658 6 ( v. 4)( otn i 4 t fnnaini moebra ya lbl frfa ulnt , 61 Ne 200 qu ig d.. t o to s r o dl vaia e o rud e Re 3 mirprsnttont nf mitk 'Re ttme ( cmd)ofConta t j1 c . ( 981 se ee ai ha or sa e.' sae nt Se t rcs 66 mta 1 ) 4 ( tngi j1 5) W ihrs ctt mitke: cii d. 5 . t epe o sa 5 6 7 8 9 Thepr nc ofr f nna i i t m a awr tng e pr s t a e m e t t ovi e e o ton s o ke ii x e s he p e nt ha t pari i ended i s d. Undert rul sat i t s Secton,r or aton i he tes nt t houl he e t ed n hi i ef m i s avaiabl when t partes havi r l e he i , ng eached an agr entand havi t atem pt eem ng hen t ed t r d e i t w rtng, a l o e pr s i c r c l i t wr tng.The rm i t kei one o e uc t o ii f i t x e s t or e ty n he ii i sa s a t e e son-one t t r l t s t t c t n s or e f c o t e wrtn t ati s o xpr s i ha e a e o he on e t fe t f h ii g h s i ended t expr t ragr ent-and t appr i e r edy i r or aton of nt o ess hei eem he oprat em s ef m i t wrtng pr l t r l t ragr ent Fort nle sat i t s Secton t hat ii opery o efect hei eem . he l t ed n hi i o be i nvoked,t ef e,t e m usthave been s e agrem entbet her or her om ween t partes he i pr ort t wrtng.Theproragr entneed not however bccom pl e and cerai i o he ii i eem , , et tn enough t be a cont act o r . l0 Rettme t( c nd ofConrcsj1 5c . ( 9 ) sae n Se o ) ta t 5 mta 1 81. 11 12 Pl ntf sar t t ar entte t a r onnaton oft Polci t accur el r l ai if gue hat hey e il d o ef i he i es o at y efect - t i e oft pate ( jl1 3 ) n i c us ofa toni srngl s ppore o t fcs he ntnt he ris.FAC l 2 -29 . s a e ci s to y u td n he a t ! l3 ' aleged unde eihera fr orm it t y. The f saleged m akepl bl eihe t l r t aud sake heor act l ausi e t r hat 1 4 Def nda s i ento l c e l d t c nt nt oft m ii g,ort tal pa te w e e i nor ntof e nt nt i naly onc a e he o e s he tn ha l ri s r g a l5 t cont oft wrtngsand t t w rtng di notacctr e y r l t proragr m e and he ene he ii hat he ii d tat l efect he i ee nt l6 t i e oft pm i s he nt nt he e. 17 Loo i a gu t tHe bs i n e il d t r f m a i be a s t r wa no m i t ke or m s r es ha r t s ot ntte o e or ton c u e he e s sa 1 8 fa Loo i s r ud. m s uppo t t sc l i by no i t a t t r soft wrte c nta twe e rs hi onc us on tng h t he e m he it n o r c r 19 unam bi guous. Thi i r evantt i er et i oft contactas wrten,buti i i s s el o nt pr aton he r it t s napposie t t o 20 det mi i ofa cl m f equiabl r or aton based on f er naton ai or t e ef m i raud orm i ake. l ues ofFaud and st ss 2l m it afectt valdiy oft contactasw rten and a e t ef e a ecedentt t contacts s ake f he i t he r it r her or nt o he r ' 22 i e r t ton. The qu ton i notwhe he t t nnsoft e wrte a r m e w e e c f s n or nt m e a i esi s t r he e h i n g ee nt r on u i g l 23 a bi ous but he he Loom i i e i na l c ce l d t c r c ' t r sf om ,o m gu , w t r s nt nto ly on a e he onta ts e m r r 24 m ir es ed t s cpr ent hem t H er ,orw het bot par i wer i antofw hatt wrten o, bst her h tes e gnor he it 25 agr entsat eem t ed. Page 21of 22 1 I i 1 ! . ' . l i ! ' l . Fi l Loom i ar naly, s gues t r r aton i notappr i ebe use M r.os tf l t hat eo m i s oprat ca a 'aied o I ! : 2 m eethi af i i dut t r d t Polci bef e he si s fnnatve y o ea he i es or gned i and/ r t or ecomm ended i f t or 2 ! i i r 3 exec i .'( . uton 'MotSumm. 23: -2 .l a l s onesae,alr t ra ac r c wheet r J. 23 4) n teat tt fiue o e d onta t r hee he ubl em 4 ia o s n pporuniy t do s a wihouta s c e e us w ilpr t t o o nd t um i nt xc e l eventt equi c r edy of ! i 5 r or tono acai ofu ltrlmitke Shedo v Har e 1 S. 2d898 900( ef mai n l m niaea sa . l n . gos , 00 E. , Ga. . 6 1 .Howe r t re onnai o a a r e ntc n bea r d i onepa t h sk edg t t 957) ve ,t l f ton f n g e me a E wa de f ry a nowl e ha : 7 t o h rpa t s f e sf o aunia e a m i t ke. Gr be v Coms oc Ba 905 P. 11 2, he t e ry u f r r m ltr l sa ' a r . ' t k nk, 2d 1 i ' 8 11 6( v.1 )(ii Gc. Com. .Le iz 71 P. 1 ( i CtApp.1 ) Hebs 1 Ne 995 ctng Pac. v vt, 6 2d 057 Arz. . 986). r t ! I ( 9 aleges t Lopm i knew i w asoper i unde a m i ake ast t cont soft 2007 Polcy. l hat s t atng r st o be ent he i i : 1 Loo sha no ne tdt salgai wihe de ce TheCo tde iss mmayj gme on 0 mi s t gae hi le ton t vi n . ur ne u r ud nt l 11 t s caus ofacton. bi e i ! ! 12 ! 1 3 c ox ct- o x vsl I I HEREBY oloElEo t tt Motont w ih a Reee e( cFxo 1 i Ts t t ha be i o tdrw frnc E, )s . i i 1 GRANTED. 4 : i 1 5 i I i : 1 ! . I I FIRTHER ORDERED t tt M otonf Summa' J TS J ha he i or l udgme ( No.8 i y nt ECF )s 1 GR AN TED i pa ta D EN I i pa t Them oto i g a e wih r s c t t a s e unde 6 n r nd ED n r. i n s r nt d t e pe t o r n f r r 1 j5 pr e sona ne i n , e c o fduca ydu y a ba f ih, de e wihr s ec t 7 ' 42, of s i l glge ce br a b f i ir t , nd d at but nid t e p t o 18 i entonalm ir es aton,neglgentm ir es aton,and r onnaton. nt i s epr ent i i s epr ent i ef i 19 I I SO ORDERED . T S 20 D a e Decem ber29, 0 t d: 201 21 22 ' R0B Unied t 23 24 25 Page 22 of 22 T C .J ES ON esD iti Judge s rct '