United States District Court, N.D. California, San Jose Division
ASSOCIATED INDUSTRIES INS. CO., INC., et al., Plaintiffs,
DETAIL CONSTRUCTION & WATERPROOFING, INC., Defendant.
ORDER FOR REASSIGNMENT TO A DISTRICT JUDGE REPORT AND
RECOMMENDATION RE MOTION FOR DEFAULT JUDGMENT RE: DKT. NO.
R. LLOYD United States Magistrate Judge.
Associated Industries Ins. Co. (AIIC) and AmTrust
International Underwriters Limited (AmTrust) filed this
insurance action, invoking diversity jurisdiction, 28 U.S.C.
§ 1332. They seek a declaratory judgment that they need
not defend or indemnify defendant Detail Construction &
Waterproofing (DCW) against claims pending in a state court
lawsuit. Plaintiffs also seek reimbursement of defense costs
incurred in the underlying state court action, as well as
costs incurred here.
present federal action, DCW was served with process (Dkt. 7),
but failed to answer or otherwise respond to the complaint.
At plaintiffs' request, the Clerk of the Court entered
defendant's default on November 22, 2016. (Dkt. 9).
now move for default judgment. DCW was served with notice of
this motion (Dkt. 10-5), but the court has received no
response, and the time for briefing has closed. Although
plaintiffs have consented to proceed before a magistrate
judge, 28 U.S.C. § 636(c); Fed.R.Civ.P. 73, defendant
has never appeared and is in default. Accordingly, this court
directs the Clerk of the Court to reassign this action to a
district judge, with the following report and recommendation
that plaintiffs' motion for default judgment be granted.
complaint alleges the following:
AIIC is a Florida corporation, authorized and engaged in the
business of writing insurance in California as an approved
surplus line insurance carrier. (Dkt. 1, Complaint ¶ 4).
AmTrust is an Irish limited company and alien surplus lines
insurance carrier, duly licensed, authorized, and engaged in
the business of issuing insurance policies in California.
(Id.). DCW is alleged to be a California
corporation. (Id 5).
and AmTrust provided general commercial liability insurance
coverage to one Yvonne Kathleen Holmes dba Detail
Construction. There are three policies (collectively,
“Policies”) at issue:
• Plaintiff AIIC provided commercial general liability
insurance to Yvonne Kathleen Holmes dba Detail Construction
as the individual named insured on Policy No. NX100317300,
which was in effect from April 8, 2012 through April 8, 2013
• AmTrust provided commercial general liability
insurance coverage to Holmes dba Detail Construction as the
individual named insured on Policy No. XN102112101, in effect
from April 8, 2013 through April 8, 2014 (2013 Policy) and
again on Policy No. XN102112102 from April 8, 2014 through
April 8, 2015 (2014 Policy).
(Id ¶ 8 & Exs. A-C).
complaint alleges that the Policies are based on standard
Commercial General Liability Form CG0001 and include the
• Under the Policies, plaintiffs are obliged to
“pay those sums that the insured becomes legally
obligated to pay as damages because of . . . ‘property
damage' to which this insurance applies.” (Dkt. 1-1
Complaint, ¶ 9, Ex. A at ECF pp. 2, 12; Dkt. 1-2
Complaint Ex. B at ECF pp. 2, 12; Dkt. 1-3 Complaint, Ex. C
at ECF pp. 2, 12).
• The Policies further provide that plaintiffs have
“the right and duty to defend the insured against any
‘suit' seeking those damages” and “no
duty to defend the insured against any ‘suit'
seeking damages for . . . ‘property damage' to
which this insurance does not apply.” ...