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Film Allman, LLC v. New York Marine And General Insurance Company, Inc.

United States District Court, C.D. California

May 22, 2017

FILM ALLMAN, LLC, Plaintiff,
v.
NEW YORK MARINE AND GENERAL INSURANCE COMPANY, INC., Defendant.

          ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT [93] AND DENYING PLAINTIFF'S MOTION FOR RECONSIDERATION [108]

          OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Before this Court is Defendant New York Marine and General Insurance Company, Inc.'s (“New York Marine”) Motion for Summary Judgment, which requests that the Court find no genuine issues of fact as to Plaintiff Film Allman, LLC's (“Film Allman”) remaining five causes of action. (ECF No. 93.) After the hearing on this motion but before the Court issued its ruling, Film Allman filed a Motion for Reconsideration of the Court's earlier Order granting partial summary judgment in favor of New York Marine. (ECF No. 108.) The Court finds that Film Allman's motion is appropriate for decision without further briefing or argument. See Fed. R. Civ. P. 78(b); C.D. Cal. L.R. 7-15.

         For the reasons discussed below, the Court GRANTS New York Marine's Motion for Summary Judgment and DENIES Film Allman's Motion for Reconsideration.

         II. FACTUAL BACKGROUND

         As has been extensively discussed in previous orders in this action, this case stems from a train accident on a film set that took the life of camera operator Sarah Jones and injured several other people. (First Am. Compl. (“FAC”) ¶ 2, ECF No. 31.) New York Marine was Film Allman's insurer against claims arising from the making of the film, among other areas of coverage. (See Def. Statement of Uncontroverted Facts (“SUF”) ¶ 10, ECF No. 94-1.) There are three relevant insurance policies at issue: a Commercial General Liability Policy (“the CGL Policy”), a Commercial Liability Umbrella Policy (“the Umbrella Policy”), and a Workers Compensation and Employers Liability Policy (“the WC Policy”). (Id. ¶¶ 11, 25, 30.) The CGL Policy insured against “bodily injury” or “property damage, ” expressly excluding claims arising from “any obligation of the insured under a workers' compensation . . . law or any similar law.” (Id. ¶¶ 12, 13; CGL Policy § (I)(2)(d), Ex. W, ECF No. 93-25.) Further, the CGL Policy excludes from coverage “bodily injury to an employee of the insured arising out of and in the course of employment to the insured; or performing duties related to the conduct of the insured's business.” (CGL Policy § (I)(2)(e).) The CGL Policy has a limit of $1 million “per occurrence.” (Id. at “Declarations page”.)

         The Umbrella Policy was retained to pay any loss that is covered by the CGL Policy but in excess of the limits of the CGL Policy. (Umbrella Policy § (I)(A)(1)-(2), Ex. X, ECF No. 93-26.) The Umbrella Policy has a limit of $4 million “per occurrence.” (Id. at “Declarations page”.) Finally, the WC Policy insured Film Allman against “benefits required of [it] by the workers compensation law.” (WC Policy Part Two, Ex. Y, ECF No. 93-27.) In addition, the WC Policy provides “employers liability” insurance against “bodily injury to [Film Allman's] employee that arises out of and in the course of employment, claimed against [Film Allman] in a capacity other than as employer.” (Id. at Part Two § (B)(4).) The “employers liability” section of the policy expressly excludes from coverage “any obligation imposed by a workers compensation . . . benefits law, or any similar law.” (Id. at Part Two § (C)(4).)

         After Film Allman provided notice of the train accident, New York Marine retained counsel in order to defend Film Allman and its principals against any litigation that arose. (SUF ¶¶ 74-99.) Predictably, litigation did follow, the most significant case being one brought by Sarah Jones's parents (“the Jones action”). (See Id. ¶ 100; Pompeii Decl. 38, ECF No. 93-1.) Other injured parties also sued. (See SUF ¶ 102.) In addition, the injured parties (including the estate of Sarah Jones) filed Workers Compensation claims with the employer of record (the payroll company), Ease. (See Sedrish Dep. at 174:12-18, ECF No. 93-5.)

         Mediation to settle the Jones action and the other crew members' lawsuits began in November 2014. (Id. ¶ 125.) Ostensibly because the potential liability of the Jones action was highest-with estimates in excess of $10 million-most of the settlement efforts were directed toward that suit. (See Id. ¶¶ 128, 133, 150.) On November 6, 2014, the Jones action was settled for a total of $6.5 million. Of this, New York Marine paid $5 million (the $1 million limits of the CGL Policy plus the $4 million limits of the Umbrella Policy). (See Id. ¶ 157, 159; Pompeii Decl. ¶ 74.) Rayonier Performance Fibers, LLC (“Rayonier”), the company that owned the land on which the train accident occurred, contributed the remaining $1.5 million. (See SUF ¶¶ 153, 154, 160.)

         Because payment of the Jones settlement exhausted both the CGL and Umbrella Policies, New York Marine advised Film Allman that New York Marine's duty to defend in connection with the train accident had ended. (SUF ¶ 170.) This left Film Allman to shoulder the cost of defending those actions without insurance. (See generally FAC.) As such, Film Allman demanded that New York Marine continue to defend it in the underlying suits. (Id.) When it refused, Film Allman filed the instant suit. (Id.)

         Because the Court granted New York Marine's earlier partial summary judgment motion (ECF No. 92), only five causes of action remain in this case: breach of contract relating to both the CGL Policy and the WC Policy, breach of the implied covenant of good faith and fair dealing with respect to both policies, and declaratory relief.

         III. DISCUSSION

         The Court will discuss its reasons for granting New York Marine's Motion for Summary Judgment before addressing Film Allman's Motion for Reconsideration.

         A. Motion for Summary Judgment

         The Court finds that there is no genuine issue of material fact remaining in this matter.

         1. ...


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