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The Burlington Insurance Company v. Chwc

January 20, 2012

THE BURLINGTON INSURANCE COMPANY, PLAINTIFF,
v.
CHWC, INC. DBA CRAZY HORSE RESTAURANT AND NIGHTCLUB; AND RUDY MARTINEZ, JR., DEFENDANTS. RUDY MARTINEZ, JR., COUNTERCLAIMANT,
v.
THE BURLINGTON INSURANCE COMPANY, COUNTERDEFENDANT.



The opinion of the court was delivered by: Hon. Manuel L. Real United States District Judge

STATEMENT OF UNCONTROVERTED FACTS AND CONCLUSIONS OF LAW

I. MOTION PRESENTED

Plaintiff The Burlington Insurance Company ("Burlington") filed a motion for summary judgment against defendant Rudy Martinez, Jr. ("Martinez") which Martinez opposed. The court conducted a hearing on December 19, 2011. Counsel for Burlington and Martinez appeared.

II. UNCONTROVERTED FACTS

A. The Insurance Policy

Burlington insured defendant CHWC, Inc. dba Crazy Horse Steak House and Saloon ("Crazy Horse") through a Commercial General Liability insurance policy which provides that Burlington "will pay those sums that the insured becomes legally obligated to pay as damages because of 'bodily injury' . to which this insurance applies." By endorsement, the Policy contains an Assault or Battery Exclusion, which provides that the Policy does not apply to bodily injury "[a]rising out of assault or battery, or out of any act or omission in connection with the prevention or suppression of an assault or battery."

B. The Tort Lawsuit Against the Insured

Mr. Martinez filed a lawsuit against Crazy Horse in state court. The Complaint alleged that Crazy Horse is "a restaurant, bar, and nightclub . which touts its 'wild and crazy nightlife' on its website." (Complaint, ¶ 4.) It alleged that Crazy Horse's "security employees, and other employees, routinely used excessive force and engaged patrons physically, handcuffed patrons, beat patrons, forced patrons to the ground, and generally physically abused patrons, causing injuries." (Id., ¶ 7.) The complaint listed seventeen such events in the seventeen months before Martinez was injured. (Id.) The Complaint further alleged that on the night of January 19, 2008, Martinez was a patron when Crazy Horse's security employees "physically removed him from the dance floor and thereafter struck him on his torso, head and face with closed fists, feet and flashlight(s) while plaintiff was handcuffed on the floor, injuring plaintiff." (Id., ¶ 5.) Based on these allegations, the Complaint alleged causes of action for assault, battery, negligence, negligent hiring, and premises liability. Each incorporated by reference the general allegations set forth above.

The assault claim further alleged that the security employees "intimidated and harassed" Martinez and acted with the intent to cause him "apprehension of a harmful or offensive contact with his person" and that he "did in fact experience apprehension of a harmful and offensive contact." (Complaint, ¶¶ 9, 10.) Both the assault and the battery claims further alleged that the security employees' "conduct in tackling and beating the Plaintiff" was done with the intent to cause great bodily harm." (Id., ¶¶ 14, 19.)

The negligence claim further alleged that Crazy Horse "breached a duty owed to Plaintiff by failing to provide a safe environment, . by failing to properly hire, train, and supervise its employees and by failing to prevent their employees from tackling and beating and battering plaintiff, more specifically beating and causing unconsciousness, head/brain trauma." (Complaint, ¶ 23.) It added that Crazy Horse negligently owned, maintained and controlled its nightclub and acted "in such a way as to cause damages to [Mr. Martinez] and allowed its employees to act in a way as to permit them to physically assault and batter their own business patrons." (Id., ¶¶ 24-25.)

The negligent hiring claim further alleged that Martinez "was tackled, brutally beaten and injured" by Crazy Horse security employees. (Complaint, ¶ 29.) It further alleged that defendants "knew of the need for properly trained employees and knew that the lives and health of their patrons were at risk if they improperly employed and/or inadequately or improperly trained employees, unsupervised employees, employees that routinely used excessive and improper force and violence used to inflict bodily harm and/or employees prone to unprovoked demonstrations of violence." (Id., ¶ 30.)

The premises liability claim further alleged that Crazy Horse had a manager or supervisor with a duty "to maintain a secure environment against foreseeable criminal acts at the subject premises, particularly reasonably foreseeable criminal acts, such as assault and battery, on the part of defendant's own employees." (Complaint, ¶ 33.) It further alleged that Crazy Horse had a duty to keep its premises "safe from the criminal and dangerous activities of the employees" of the club. (Id., ¶ 35.)

The premises liability claim further alleged that on January 19, 2008, Crazy Horse employed security employees "who were trained, encouraged, and/or allowed to use unnecessary and excessive force that would cause great bodily harm" and who "had a known propensity for violence and, in fact, became violent on January 19, 2008, and inflicted serious injuries to [Martinez] without provocation or necessity." (Id., ¶ 36.) Finally, it alleged that defendants "negligently managed and controlled their employees so as to allow [Martinez] to be tackled, beaten, restrained, and seriously injured . by the employees of the Crazy Horse Restaurant." (Id., ¶ 37.)

The West Covina Police Department's Crime Report ("Crime Report") was provided to Burlington with the Martinez Complaint. It identifies the crimes committed against Mr. Martinez as "battery" and "battery with serious bodily injury" and cites Penal Code sections 242 (battery-defined) and 243 (battery-punishment). It identifies the actions of "the suspect" as "struck victim." Its synopsis states that Martinez was "struck several times" and "placed in critical condition."

The Crime Report's narrative summarized that Martinez "was getting kicked out" of the Crazy Horse "when a fight broke out" and he was struck several times before being restrained. Crazy Horse security officers told police that they were removing Mr. Martinez from the premises, the Martinez family had protested, and the incident escalated into a fight. Security "had to physically restrain Martinez and took him to the ground in doing so." The Crime Report further stated that Mr. Martinez's sister went to the police station the next morning and reported that Mr. Martinez had been "assaulted" by the security team. She said that as she was dancing, security guards "swarmed" her brother and started ...


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