Fedonczak et al v. State Farm Mutual Automobile Insurance Company et al

Filing 59

MEMORANDUM OPINION AND ORDER directing that it is hereby ORDERED: (1) State Farm's 51 Motion to Opt Out is GRANTED; (2) EMC's 54 Motion to Opt Out is GRANTED; and (3) the Clerk of Court is DIRECTED to remove Staet Farm and EMC as parties to this lawsuit. Signed by Hon. Chief Judge Mark E. Fuller on 12/3/10. (scn, )

Fedonczak et al v. State Farm Mutual Automobile Insurance Company et al

Doc. 59

IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF ALABAMA N O R T H E R N DIVISION J O N EDWARD FEDONCZAK, et al., P la in tif f s , v. S T A T E FARM MUTUAL AUTOMOBILE IN S U R A N C E COMPANY, et al., D e f e n d a n ts. ) ) ) ) ) ) ) ) ) )

C A S E NO. 2:10-cv-61-MEF

M E M O R A N D U M OPINION AND ORDER T h is cause is before the Court on Defendant State Farm Mutual Automobile In s u ra n c e Company's ("State Farm") Motion to Opt Out (Doc. # 51), filed November 16, 2 0 1 0 ; and Defendant EMC Insurance Company's ("EMC") Notice of Opting Out (Doc. # 5 4 ), filed November 17, 2010. The Court construes EMC's Notice of Opting Out (Doc. # 5 4 ) as containing a Motion to Opt Out. For the reasons stated below, these Motions are d u e to be GRANTED. T h e Alabama Supreme Court's opinion in Lowe v. Nationwide Insurance C o m p a n y , 521 So.2d 1309 (Ala. 1988) gives underinsured motorist carriers who are jo in e d as parties to a lawsuit the right to choose not to participate in the proceedings. The in s u re r's election to opt out of the proceedings must be timely, but "whether the insurer's m o tio n to withdraw is timely made is left to the discretion of the trial court, to be judged a c c o rd in g to the posture of the case." Ex parte Edgar, 543 So.2d 682, 684 (Ala. 1989). However, under Alabama law, it "would not be unreasonable for the insurer to participate

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in the case for a length of time sufficient to enable it to make a meaningful determination a s to whether it would be in its best interest to withdraw." Id. at 685. The Plaintiff argues that in this case, State Farm should not be able to exercise it's rig h t to opt out under Lowe because State Farm has participated in the case through the c lo s e of discovery. It is the opinion of this Court, however, that State Farm's p a rtic ip a tio n has not been unreasonable. State Farm filed its Motion to Opt Out less than tw o weeks after the last deposition was taken in this case. While State Farm still has a d u ty to defend Defendant Kenneth Ray Grissom, as his primary liability insurer, that duty s h o u ld not affect State Farm's right to be dismissed from the lawsuit as a named party. Plaintiffs have not contested EMC's Motion to Opt Out, and therefore this Motion is also due to be granted. It is hereby ORDERED: 1 . State Farm's Motion to Opt Out (Doc. # 51) is GRANTED. 2 . EMC's Motion to Opt Out (Doc. # 54) is GRANTED. 3 . The Clerk of the Court is DIRECTED to remove State Farm and EMC as p a rtie s to this lawsuit. Done this the 3 day of December, 2010.
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/s/ Mark E. Fuller CHIEF UNITED STATES DISTRICT JUDGE

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