Kurt Brunner v. CUSA PCSTC, LLC

Filing 16

ORDER DENYING DEFENDANT CUSA PCSTC, LLCs MOTION TO DISMISS 11 by Judge Dean D. Pregerson. (lc). Modified on 2/10/2015 (lc).

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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KURT BRUNNER,

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Plaintiff,

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v.
CUSA PCSTC, LLC, DBA PACIFIC
COAST SIGHTSEEING TOURS &
CHARTERS,
Defendants.
___________________________

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Case No. SACV 14-00977 DDP (RNBx)
ORDER DENYING DEFENDANT’S MOTION
TO DISMISS

[Dkt. No. 11]

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Presently before the Court is Defendant CUSA PCSTC, LLC’s

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Motion to Dismiss Plaintiff Kurt Brunner’s Complaint. Having

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considered the submissions of the parties, the court denies the

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motion and adopts the following order.

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I. Background

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On October 14, 2010, Kurt Brunner (“Plaintiff”) was a

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passenger in an airport shuttle when a bus owned by Defendant CUSA

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PCSTC, LLC (“Defendant”) collided with the airport shuttle.

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(Compl. ¶¶ 4-6.)

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and bodily injuries due to the collision.

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///

Plaintiff alleges he suffered serious emotional
(Id. ¶ 7.)

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On July 20, 2011, Plaintiff’s attorneys sent a letter of

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representation to Sedgwick Claims Management Services, Inc.

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(“Sedgwick”), the third party administrator of Defendant’s

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automobile liability policy, placing Defendant and Sedgwick on

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notice of Plaintiff’s injuries from the collision.

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On January 3, 2012, Defendant filed for Chapter 11 bankruptcy in

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the United States Bankruptcy Court, District of Delaware as Case

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No. 12-10062 (“Bankruptcy Case”).

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Plaintiff filed a Proof of Claim in the Bankruptcy Case.

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(Id. ¶ 10.)

(Id. ¶¶ 8-9.)

On March 29, 2012,
(Id. ¶

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On January 3, 2013, Plaintiff’s counsel received

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correspondence from Sedgwick that Plaintiff’s claim had been

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reassigned to claims examiner, Darla Nehaz.

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stated that Plaintiff’s claims were currently stayed because of the

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bankruptcy filing, thus she could not advance the filing of

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Plaintiff’s claim, but requested that Plaintiff submit a “demand

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package” as she was working on the documentation for the claim.

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(Id. ¶ 13.)

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requested “demand package” and asked to be notified immediately

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upon direction from the bankruptcy court to proceed with claims

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administration and if/when the stay was lifted.

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(Id. ¶ 13.)

Nehaz

On February 18, 2013, Plaintiff submitted the

(Id. ¶ 14.)

On May 31, 2013, the bankruptcy court issued an order (1)

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approving trust agreements, (2) authorizing the transfer of

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remaining assets to the lender trustee, (3) dismissing debtor’s

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Chapter 11 cases and (4) granting related relief.

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On June 10, 2013, the Bankruptcy Case was closed. (Id.)

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alleges he never received notice that the bankruptcy case was

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(Mot., Ex. A.)
Plaintiff

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dismissed from the bankruptcy court or Defendant.

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26.)

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(Compl. ¶¶ 23,

On September 21, 2013, however, Plaintiff received a notice

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from the appointed trustee in the Bankruptcy Case that stated the

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United States Bankruptcy Court entered an order on May 31, 2013,

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establishing a “trust” to liquidate and distribute assets to

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beneficiaries, including Plaintiff.

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requested that Plaintiff fill out and return the enclosed W-9 form.

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(Id.)

(Id. ¶ 15.)

The notice also

Plaintiff completed the W-9 form and submitted it to the

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trustee as requested.

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contact Nehaz for an update on the status of his claims, but was

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unable to reach her.

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(Id.)

Thereafter, Plaintiff attempted to

(Id. at ¶ 16.)

On December 3, 2013, Sedgwick reassigned Plaintiff’s claim to

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a new claims adjuster, Douglas Johnson. (Id. ¶ 16.)

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2014, Johnson sent Plaintiff a correspondence stating that the

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statute of limitations had expired.

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received this correspondence on May 12, 2014.

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(Id. ¶ 22.)

On April 7,

Plaintiff

(Id.)

On June 25, 2014, Plaintiff filed the instant suit seeking

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damages for injuries sustained in the traffic collision.

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Defendant now moves to dismiss the Complaint on the grounds that it

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is barred by the statute of limitations.

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II. Legal Standard

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(Id.)

A complaint will survive a motion to dismiss when it contains

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“sufficient factual matter, accepted as true, to state a claim to

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relief that is plausible on its face.”

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662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,

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570 (2007)).

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“accept as true all allegations of material fact and must construe

Ashcroft v. Iqbal, 556 U.S.

When considering a Rule 12(b)(6) motion, a court must

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those facts in the light most favorable to the plaintiff.”

Resnick

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v. Hayes, 213 F.3d 443, 447 (9th Cir. 2000).

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motion is brought upon statute of limitations grounds, “a complaint

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cannot be dismissed unless it appears beyond doubt that the

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plaintiff can prove no set of facts that would establish the

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timeliness of the claim.”

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68 F.3d 1204, 1207 (9th Cir. 1995).

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consider allegations contained in the pleadings, exhibits attached

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to the complaint, and matters properly subject to judicial notice

When a 12(b)(6)

Supermail Cargo, Inc. v. United States,
Generally, courts can only

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when ruling on a motion to dismiss.

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City of Beaumont, 506 F.3d 895, 899 (9th Cir. 2007).

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III. Discussion

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Outdoor Media Grp., Inc. v.

Defendant argues that Plaintiff’s claim is barred by the

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statute of limitations.

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for Plaintiff’s claim is two years.

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At the time Defendant filed for bankruptcy on January 3, 2013, both

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parties agree that Plaintiff had 285 days remaining to file suit,

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or until October 14, 2013, to file the instant claim.

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Opp. at 3.)

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In California, the statute of limitations
Cal. Code Civ. Proc. § 335.1.

(Mot. at 4;

When a debtor files a petition for bankruptcy, an automatic

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stay comes into effect, preventing “the commencement or

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continuation . . . of a judicial, administrative, or other action

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or proceeding against the debtor . . . to recover a claim against

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the debtor that arose before the commencement of” the bankruptcy

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case. 11 U.S.C. § 362(a)(1).

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the bankruptcy case is either closed or dismissed, or until a

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discharge is granted or denied, whichever comes first.

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362(c).

The automatic stay continues until

11 U.S.C. §

Section 362(a) does not, however, toll the running of
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statutes of limitations.

See Husmann v. TWA, 169 F.3d 1151, 1154

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(8th Cir. 1999)(“The Bankruptcy Code does not provide that a

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statute of limitations is tolled during the period of bankruptcy.”)

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The bankruptcy court dismissed the case on May 31, 2014.1

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(Defendant’s Request for Judicial Notice.)

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year statute of limitations had expired.

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the Complaint here is nevertheless timely because he is entitled to

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an extension of time pursuant to 11 U.S.C. § 108(c).2

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By that time, the two-

Plaintiff counters that

Though Section 362 does not toll statutes of limitations,

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Section 108(c) extends the filing period for claims that otherwise

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might be subject to such time bars.

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such period does not expire until the later of the statute of

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limitations period or “30 days after notice of the termination or

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expiration of the stay under section 362 . . . with respect to such

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claim [against the debtor.]" 11 U.S.C. § 108(c).

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section 108(c) is to extend “applicable time deadlines . . . for 30

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days after notice of the termination of a bankruptcy stay, if such

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deadline would have fallen on an earlier date.”

Aslanidis v. U.S.

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Lines, Inc., 7 F.3d 1067, 1073 (2nd Cir. 1993).

“There is no

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language in either in the Automatic Stay provision or the Extension

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of Time provision of the Bankruptcy Code that suspends a statute of

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limitations from running . . . The extension of time provision

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merely provides an extra 30 days to file a claim if the claims’

Section 108(c) states that

The purpose of

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In his complaint, Plaintiff alleged on information and
belief that the bankruptcy case was dismissed on December 3, 2013.
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Plaintiff somewhat imprecisely argues that the statute of
limitations has not expired. (Opp. at 1.) As discussed herein,
the questions whether the statute of limitations expired and
whether Plaintiff’s Complaint was timely filed under 11 U.S.C. §
108(c)are distinct.
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limitation period expired before the automatic stay was lifted.”

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Grotting v. Hudson Shipbuilders, Inc., 85 B.R. 568, 569 (W.D. Wash.

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1988).

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Plaintiff argues that under Section 108(c), the Complaint is

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timely because Plaintiff has yet to receive notice from either the

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bankruptcy court or Defendant that the automatic stay has been

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lifted.

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complaint timely filed under similar circumstances.

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v. Worcester 55 Cal. App. 4th 376 (1997), the plaintiff filed suit

(Opp. at 2.)

At least one California court has found a
In Shumacher

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to foreclose on a street improvement bond after the four year

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statute of limitations had expired.

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the court noted that the plaintiff’s claim was timely under Section

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108(c) because the statute of limitations was extended until 30

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days after plaintiff received notice of the termination of the

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bankruptcy stay.

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been given notice of the termination of the bankruptcy stay, the

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30-day period for [plaintiff] to file his complaint did not expire

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and the complaint was timely filed.”).3

Finding the suit timely filed,

Shumacher, 55 Cal. App. 4th at 380 (“Not having

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Though not raised by Defendant, at least one other court has
refused to apply Section 108(c). In Inco Development Corp. v.
Superior Court, 131 Cal. App. 4th 1014 (2005), plaintiffs brought a
suit for latent defects after the ten-year statute of limitations
had lapsed and years after the bankruptcy case was dismissed.
Unlike the situation in Shumacher, however, and unlike the facts
alleged here, the Inco plaintiffs had never given any notice of a
possible claim against the bankrupt party. Inco, 131 Cal. App. 4th
at 1024. Under those circumstances, the court stated that “[t]o
hold in effect that the suspension of the limitations period
continued as to those plaintiffs, merely because they were not
given notice of termination [pursuant to 11 U.S.C. § 108(c)] would
be a result serving no rational purpose” and could lead to “absurd
results” where plaintiffs could bring “unknown and unforeseeable”
claims years after a bankruptcy proceeding concluded. Id.
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In reply, Defendant asserts that Plaintiff has not alleged

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facts sufficient to establish that Section 108(c) applies.

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at 2.)

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never received notice that the bankruptcy case has been dismissed,

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or the stay lifted, is sufficient.

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IV. Conclusion

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The court disagrees.

(Reply

The allegation that Plaintiff has

(Complaint ¶ 23.)

For the reasons stated above, Defendant’s Motion to Dismiss is
DENIED.

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IT IS SO ORDERED.

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Dated: February 10, 2015

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DEAN D. PREGERSON

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United States District Judge

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