United States District Court, E.D. California
MEMORANDUM AND ORDER
MORRISON C. ENGLAND JR. UNITED STATES DISTRICT JUDGE
bringing this lawsuit, Kinsale Insurance Company
(“Plaintiff”) seeks redress from Sky High Sports
Opportunities LLC (“Opportunities”) and three Sky
High Sports franchisees: Sky High Sports Santa Clara LLC, Sky
High Sports Sacramento LLC, and Sky High Sports Concord LLC
(“Ownership Companies”), (collectively
“Defendants”).FAC, ECF No. 35, at 1:24-2:5. Presently
before the Court is Plaintiff's Motion for Summary
Judgment (“Plaintiff's Motion”), which is
premised on the contention that Plaintiff is entitled to
recover unpaid insurance premiums and unreimbursed
deductibles from Defendants. Pl.'s Mot., ECF No. 37;
Pl.'s P & A Mot., ECF No. 37-1, at 3:14-18.
Defendants filed an Opposition to Plaintiff's Motion, to
which Plaintiff submitted a Reply. Defs.' Opp., ECF No.
51; Pl.'s Reply, ECF No. 53.
reasons set forth below, the Court GRANTS in part and DENIES
in part Plaintiff's Motion, ECF No. 37.
franchise and/or operate amusement centers with trampolines,
foam pits, and snack bars at various locations across the
United States. FAC ¶ 13. Plaintiff is an Arkansas
corporation that provides, inter alia, commercial
general liability insurance. Id. at ¶ 1.
the facts surrounding the present action are undisputed by
the parties. Defs.' Opp. at 3:5-8; SUMF, ECF No.
53-2. Plaintiff issued five total commercial
general liability insurance policies (“Insurance
Contracts”) to various Sky High entities between
November 2, 2011 and September 21, 2013. Pl.'s P & A
Mot. at 4:15-5:12; SUMF ¶ 13. Only two of these
Insurance Contracts are at issue here: (1) the September 21,
2011 to September 21, 2012 Insurance Contract issued to
Ownership Companies and Opportunities; and (2) the September
21, 2012 to September 21, 2013 Insurance Contract issued to
Ownership Companies. FAC ¶ 14. Pursuant to the Insurance
Contracts, Plaintiff was entitled to advance amounts within
the applicable $25, 000 deductible threshold to satisfy
insurance claims, and then seek reimbursement for these
deductible payments from Defendants. Id. at
¶¶ 20, 22; SUMF ¶¶ 1, 24. Additionally,
at the time the policies were issued, Defendants paid an
insurance premium deposit, with the agreement that the final
premium owed would be adjusted based on Defendants' gross
sales figures. Pl.'s P & A Mot. at 7:19-27,
10:22-11:1; SUMF ¶ 54.
determine the final premium, Plaintiff was entitled to
perform an audit of Defendants' finances at the end of
each policy term. FAC ¶ 15; SUMF ¶¶ 17, 54. A
dispute arose when Defendants refused to provide Plaintiff
original financial ledgers after the coverage periods of the
Insurance Contracts ended. FAC ¶ 16. This prevented
Plaintiff from calculating Defendants' gross sales for
the purpose of determining the insurance premiums owed.
Id. Plaintiff filed a Complaint against Defendants
on September 9, 2014, claiming that Defendants' actions
were in breach of the audit provisions of the Insurance
Contracts. FAC ¶ 17; Compl., ECF No. 1. Plaintiff
subsequently filed a motion for summary judgment on the basis
of that breach, (ECF No. 11), which the Court granted in
part, by ordering an audit of Defendants' finances as
stipulated in the Insurance Contracts. FAC ¶ 17; 2015
Order, ECF No. 21. Plaintiff's auditor commenced that
audit in September of 2015, and concluded the following: (1)
Ownership Companies owe $777, 372.00 in final premiums and
$96, 211.76 in unreimbursed deductibles; and (2)
Opportunities owes $350, 376.00 in final premiums and $69,
822.76 in unreimbursed deductibles. FAC ¶ 18; Pl.'s
Am. Mot., ECF No. 39, at 2:4-20.
of this lawsuit Plaintiff seeks to recover those final
premiums and unreimbursed deductibles as identified by the
audit. FAC ¶ 19-20. Plaintiff filed the present Motion
on June 21, 2016, asking that this Court find as a matter of
law that Defendants are liable in accordance with the
audit's findings. Pl.'s P & A Mot. at 20:18- 21.
Defendants filed an Opposition, conceding that Plaintiff is
owed reimbursement for the deductible payments, but
challenging the amount owed for insurance premiums.
Defs.' Opp. at 2:2-7, 3:18-6:11.
Federal Rules of Civil Procedure provide for summary judgment
when “the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see also Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986). One of the principal purposes of Rule 56 is to
dispose of factually unsupported claims or defenses.
Celotex, 477 U.S. at 325.
also allows a court to grant summary judgment on part of a
claim or defense, known as partial summary judgment.
See Fed.R.Civ.P. 56(a) (“A party may move for
summary judgment, identifying each claim or defense-or the
part of each claim or defense-on which summary judgment is
sought.”); see also Allstate Ins. Co. v.
Madan, 889 F.Supp. 374, 378-79 (C.D. Cal. 1995). The
standard that applies to a motion for partial summary
judgment is the same as that which applies to a motion for
summary judgment. See Fed.R.Civ.P. 56(a); State
of Cal. ex rel. Cal. Dep't of Toxic Substances Control v.
Campbell, 138 F.3d 772, 780 (9th Cir. 1998) (applying
summary judgment standard to motion for summary
summary judgment motion, the moving party always bears the
initial responsibility of informing the court of the basis
for the motion and identifying the portions in the record
“which it believes demonstrate the absence of a genuine
issue of material fact.” Celotex, 477 U.S. at
323. If the moving party meets its initial responsibility,
the burden then shifts to the opposing party to establish
that a genuine issue as to any material fact actually does
exist. Matsushita Elec. Indus. Co. v. Zenith
Radio Corp., 475 U.S. 574, 586-87 (1986); First
Nat'l Bank v. Cities Serv. Co., 391 U.S. 253, 288-89
attempting to establish the existence or non-existence of a
genuine factual dispute, the party must support its assertion
by “citing to particular parts of materials in the
record, including depositions, documents, electronically
stored information, affidavits[, ] or declarations . . . or
other materials; or showing that the materials cited do not
establish the absence or presence of a genuine dispute, or
that an adverse party cannot produce admissible evidence to
support the fact.” Fed.R.Civ.P. 56(c)(1). The opposing
party must demonstrate that the fact in contention is
material, i.e., a fact that might affect the outcome of the
suit under the governing law. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248, 251-52 (1986); Owens v.
Local No. 169, Assoc. of W. Pulp and Paper Workers, 971
F.2d 347, 355 (9th Cir. 1987). The opposing party must also
demonstrate that the dispute about a material fact “is
‘genuine, ' that is, if the evidence is such that a
reasonable jury could return a verdict for the nonmoving
party.” Anderson, 477 U.S. at 248. In other
words, the judge needs to answer the preliminary question
before the evidence is left to the jury of “not whether
there is literally no evidence, but whether there is any upon
which a jury could properly proceed to find a verdict for the
party producing it, upon whom the onus of proof is
imposed.” Anderson, 477 U.S. at 251 (quoting
Improvement Co. v. Munson, 81 U.S. 442, 448 (1871))
(emphasis in original). As the Supreme Court explained,
“[w]hen the moving party has carried its burden under
Rule [56(a)], its opponent must do more than simply show that
there is some metaphysical doubt as to the material
facts.” Matsushita, 475 U.S. at 586.
Therefore, “[w]here the record taken as a whole could
not lead a rational trier of fact to find for the nonmoving
party, there is no ‘genuine issue for
trial.'” Id. 87.
resolving a summary judgment motion, the evidence of the
opposing party is to be believed, and all reasonable
inferences that may be drawn from the facts placed before the
court must be drawn in favor of the opposing party.
Anderson, 477 U.S. at 255. Nevertheless, inferences
are not drawn out of the air, and it is the opposing
party's obligation to produce a factual predicate from
which the inference may be drawn. Ric ...