RSUI Indemnity Company v. Goldco, Inc.

Filing 48

ORDER ent. that the parties request for a stay is GRANTED IN PART 47 ; This action is stayed until October 1, 2010; ( Scheduling Conference set for 10/5/2010 10:00 AM in US Courthouse, Courtroom 1A, 113 St. Joseph Street, Mobile, AL 36602 before Magistrate Judge Sonja F. Bivins.) Signed by Magistrate Judge Sonja F. Bivins on 7/1/10. (mjn)

RSUI Indemnity Company v. Goldco, Inc.

Doc. 48

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION RSUI INDEMNITY COMPANY, Plaintiff, vs. GOLDCO, INC. Defendant. * * * * * * * * *

CIVIL ACTION No. 09-00776-B

ORDER This action is before the Court on the parties' joint

request to stay this action, and supporting brief. (Doc. 47). After carefully considering the foregoing and the other relevant material in the file, the Court concludes that the request is due to be granted, in part. Background Plaintiff RSUI Indemnity Company (hereinafter "RSUI")

initiated this declaratory judgment action on November 25, 2009. (Doc. 1). RSUI seeks a declaratory judgment determining its

obligations to Defendant Goldco, Inc. pursuant to an insurance policy issued by RSUI to Goldco, Inc. RSUI asserts that various

sexual harassment claims have been asserted against Goldco, Inc. and that the claims are not covered under the terms and

conditions of the subject policy because the allegations arise out of the actions of an employee of Goldco, LLC, which actions

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are identical to actions which formed the basis of claims that were reported to and made known to Goldco, LLC prior to the covered period; thus, the claims are excluded under the policy, and Goldco, Inc. is not entitled to indemnity or defense.

Goldco, Inc. has asserted a counterclaim against RSUI and seeks a declaration that the policy issued by RSUI provides coverage for the sexual harassment claims. According to the parties, the underlying sexual harassment claims are still pending before the Equal Employment Opportunity Commission ("EEOC"), which

conducted an unsuccessful conciliation conference on April 22, 2010. The parties jointly request that this action be stayed

until the EEOC either issues Right to Sue letters or initiates a lawsuit on behalf of the claimants. The parties contend that

"[t]he resolution of the EEOC Proceeding is critical to the resolution including of those this action because the underlying claimants, and the

whose

identities

remain

undisclosed,

value of their claims may be necessary to the disposition of this dispute." (Doc. 47 at 2). In essence, the parties contend that the stay is needed in order to determine the necessary parties to this action. Discussion "[A] district court [has] discretion to stay a case pending the resolution of related proceedings in another forum." Ortega 2

Truillo v. Conover & Co. Communs., Inc., 221 F.3d 1262, 1264 (llth Cir. 2000). "When a court exercises its discretion..., A

the district court must properly limit the scope of the stay. stay must not be "immoderate." Id.

In considering whether a

stay is immoderate, the court must "examine both the scope of the stay (including its potential duration) and the reasons

cited by the district court for the stay." Id.

In Ortega, the

Eleventh Circuit held that the district court had abused its discretion in granting the stay because the stay was

"immoderate."

In reaching this conclusion, the Court observed

that the scope of the stay seemed indefinite, and by its own terms, it remained in effect until the foreign government

concluded their review. Id. In the case sub judice, it the undersigned entirely observes clear that as a

preliminary

matter,

that

is

not

the

requested stay is essential in this case.

While resolution of

the EEOC administrative proceedings will undoubtedly assist the parties in indentifying the number of potential claimants and in placing a dollar value on the claims, the parties have not

explained how the outcome of the administrative proceedings will affect the central issue exists before for LLC. the As the court, namely whether claims is

insurance asserted

coverage against

sexual a

harassment the

Goldco,

result,

Court

reluctant to permit this case to linger for an extended period. 3

That said, the parties' request for a stay is granted, in part. This action is stayed until October 1, 2010. This matter is hereby set for a scheduling conference

before the undersigned Magistrate Judge on October 5, 2010 at 10:00 a.m., in Courtroom 1A, United States Courthouse, 113 St. Joseph Street, Mobile, Alabama. DONE this 1st day of July, 2010. /s/ SONJA F. BIVINS UNITED STATES MAGISTRATE JUDGE

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