American States Insurance Company v. Robert Hubbard

Filing 40

JUDGMENT FOR AMERICAN STATES INSURANCE COMPANY by Judge R. Gary Klausner. Accordingly, ASIC is entitled to judgment, and the Court hereby enters its Judgement, in favor of ASIC and against Hubbard, that: 1. ASIC never had a duty to defend Hubbard i n the Underlying Action; 2. ASIC had and has no duty to defend Hubbard in this Action; 3. Hubbard is obligated to pay $183,992.98 to ASIC; 4. Hubbards counterclaims are dismissed; and 5. ASIC may recover its costs of suit taxed in this matter from Hubbard. IT IS SO ADJUDGED. (MD JS-6, Case Terminated). (lom)

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1 2 JS-6 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 AMERICAN STATES INSURANCE COMPANY, an Indiana corporation, 11 Plaintiff, 12 v. 13 ROBERT G. HUBBARD dba 14 NORTHWEST BEVERAGE DISTRIBUTORS and dba PUR 15 BEVERAGES, Case No. 2:16-cv-03734-RGK-JPR Hon. R. Gary Klausner JUDGMENT FOR AMERICAN STATES INSURANCE COMPANY Defendants. 16 17 _______________________________ 18 ROBERT G. HUBBARD dba NORTHWEST BEVERAGE 19 DISTRIBUTORS and dba PUR BEVERAGES 20 Counter-claimant, 21 v. 22 AMERICAN STATES INSURANCE 23 COMPANY, Counter-defendant. 24 25 26 27 28 SMRH:481209728.1 [PROPOSED] JUDGMENT FOR AMERICAN STATES INSURANCE COMPANY 1 In its Motion for Summary Judgment (Docket Entry 27), filed on 2 January 13, 2017, Plaintiff and Counterdefendant, American States Insurance 3 Company (“ASIC”), sought declarations that it (a) had no duty to defend Defendant, 4 Robert G. Hubbard d/b/a Northwest Beverage Distributors and d/b/a/ Pur Beverages 5 (“Hubbard”), in an underlying action for trademark infringement that was litigated 6 to judgment in this Court as Case No. 2:13-cv-06917-RGK, POM Wonderful LLC et 7 al. v. Robert G. Hubbard, et al, Case 2:13-cv-06917-RGK (JPRx) (the “Underlying 8 Action”); (b) it had, and has, no duty to defend or indemnify Hubbard in this 9 declaratory judgment action (“this Action”); and (c) it is entitled to restitution of 10 costs that it incurred, after April 6, 2016, defending Hubbard in the Underlying 11 Action. ASIC also sought summary judgment on Hubbard’s counterclaims. 12 By Order dated February 14, 2017 (the “Order”), the Court granted 13 ASIC’s Motion for Summary Judgment on all of ASIC’s claims, as well as on all of 14 Defendant’s counterclaims (Docket Entry 36.) Under the Order, the Court found 15 that all of the claims alleged in the Underlying Action arose out of a category of 16 claims - - trademark infringement - - specifically excluded by the ASIC insurance 17 policies at issue.1 Accordingly, the Court determined that Hubbard did not meet his 18 initial burden of demonstrating that the claims alleged in the Underlying Action 19 created a potential for covered damages, triggering a duty to defend. Therefore, the 20 Court concluded that ASIC never had a duty to defend Hubbard in the Underlying 21 Action. Hubbard’s counterclaims for breach of contract and breach of the 22 23 implied covenant of good faith and fair dealing also hinge on the duty-to-defend 24 determination. Because ASIC had no duty to defend, its conduct in connection with 25 the Underlying Action cannot have amounted to a breach of contract or a breach of 26 27 1 Policy numbers 01-CI-547356-10, 01-CI-547356-20 and 01-CI-547356-30. 28 -1SMRH:481209728.1 [PROPOSED] JUDGMENT FOR AMERICAN STATES INSURANCE COMPANY 1 the implied covenant of good faith and fair dealing, and, accordingly, the Court 2 granted ASIC’s motion on Hubbard’s counterclaims. 3 Under the Order, the Court found that ASIC expressly reserved its 4 right, as of April 6, 2016, to recoup from Hubbard any defense or indemnity 5 payments it makes that a Court determines ASIC was not obligated to make. 6 Accordingly, the Court determined that ASIC is entitled to reimbursement of all 7 legal fees and costs that it incurred in the Underlying Action after April 6, 2016. 8 The Court found inconsistencies in the evidence ASIC submitted to demonstrate the 9 precise amount of its reimbursement claim. Accordingly, the Court ordered ASIC to 10 provide a supplemental declaration clarifying the legal costs and fees that it incurred 11 after April 6, 2016 in the Underlying Action. On February 17, 2017, ASIC filed the 12 required supplemental declaration (Docket Entry 38), which establishes that ASIC is 13 entitled to $183,992.98 in reimbursement. 14 Accordingly, ASIC is entitled to judgment, and the Court hereby 15 enters its Judgement, in favor of ASIC and against Hubbard, that: 1. ASIC never had a duty to defend Hubbard in the Underlying 18 2. ASIC had and has no duty to defend Hubbard in this Action; 19 3. Hubbard is obligated to pay $183,992.98 to ASIC; 20 4. Hubbard’s counterclaims are dismissed; and 21 5. ASIC may recover its costs of suit taxed in this matter from 16 17 Action; 22 Hubbard. 23 IT IS SO ADJUDGED. 24 25 26 Dated: 2/23/17 27 HON. R. GARY KLAUSNER 28 U.S. DISTRICT COURT JUDGE -2SMRH:481209728.1 [PROPOSED] JUDGMENT FOR AMERICAN STATES INSURANCE COMPANY

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