Rigsby et al v. Intercare Specialty Risk Insurance Services, Inc. , et al.,

Filing 100

STIPULATION and ORDER to Sever Defendant Patriot National, Inc., signed by District Judge Morrison C. England, Jr., on 3/14/18. (Kastilahn, A)

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ROBERT R. RIGGS (SBN 107684)
STEPHEN G. PREONAS (SBN 245334)
Katzoff & Riggs LLP
1500 Park Avenue, Suite 300
Emeryville, CA 94608
Tel. [phone]
email: [e-mail]
Attorneys for Plaintiffs KAREN RIGSBY,
Trustee, and DONALD P. STEINMEYER

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA – SACRAMENTO DIVISION

1500 PARK AVENUE, SUITE 300
EMERYVILLE, CA 94608
[phone]

KATZOFF & RIGGS LLP

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KAREN RIGSBY, Trustee of the
MARSH REVOCABLE TRUST OF
2003, and DONALD P. STEINMEYER,
an individual,

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Plaintiffs,
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vs.
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INTERCARE SPECIALTY RISK
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INSURANCE SERVICES, INC., et al. )
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Defendants.
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_________________________________ )
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and RELATED CROSS ACTION
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_________________________________ )

Case No. 2:17-cv-01347-MCE-EFB
STIPULATION AND ORDER TO
SEVER DEFENDANT PATRIOT
NATIONAL, INC.

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On June 30, 2017, Plaintiffs Karen Rigsby, as Trustee of the Marsh Revocable

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Trust of 2003 and Donald P. Steinmeyer (“Plaintiffs”) filed this action for Breach of

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Contract against Defendant Intercare Specialty Risk Insurance Services, Inc., and its
_______________________________________________________________________
STIPULATION AND ORDER TO SEVER DEFENDANT PATRIOT NATIONAL, INC.

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successor-in-interest ISR Holdings, Inc. (“ISR”); Alter Ego Liability against Defendants

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ISR and Kevin Hamm (“Hamm”); Intentional Interference of Contract against Defendant

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Patriot National, Inc. (“Patriot”); and Fraudulent Conveyance against Defendants Patriot

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and Phoenix Risk Management, Inc. (“Phoenix”).

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On September 21, 2017, ISR filed a Cross-Complaint against Plaintiffs. Patriot is
not named as a Cross-Defendant in the Cross-Complaint.
On January 30, 2018, Patriot filed for Chapter 11 Bankruptcy in the United States

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Bankruptcy Court for the District of Delaware (“the Bankruptcy Petition”).

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The

bankruptcy matter is entitled In re Patriot National, Inc., Case No. 18-10189.

1500 PARK AVENUE, SUITE 300
EMERYVILLE, CA 94608
[phone]

KATZOFF & RIGGS LLP

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On February 5, 2018, Patriot filed a Suggestion of Bankruptcy of Defendant

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Patriot National, Inc. noticing a stay on prosecution of the action against Patriot pursuant

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to Bankruptcy Code § 362(a).

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The parties in this action agree and stipulate as follows:

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1.

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Proc. 21.

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2.

Good cause exists to sever the action as to Patriot pursuant to Fed. R. Civ.

A stay of the action due to Patriot’s Bankruptcy Petition will cause

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indefinite delay of the action and prejudice Plaintiffs if Plaintiffs are not permitted to

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proceed with their claims against the three solvent defendants, ISR, Hamm, and Phoenix.

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3.

Severing Patriot from the action will promote the expeditious resolution of

this litigation.
4.

Patriot is not an indispensable party to this litigation because:
a. This action primarily arises out of a contract between Plaintiffs and ISR.

_______________________________________________________________________
STIPULATION AND ORDER TO SEVER DEFENDANT PATRIOT NATIONAL, INC.

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Patriot is a third party to that contract.

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b. Plaintiffs’ claim of Intentional Interference of Contract is stated solely
against Patriot and involves different issues of fact and law from Plaintiffs’ other claims.

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c. Plaintiffs allege that Patriot and Phoenix are joint tortfeasors with respect to

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Plaintiffs’ claim of fraudulent conveyance. Joint tortfeasors are not indispensable parties

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under federal law. (In re Related Asbestos Cases, 23 B.R. 523, 530 (N.D. Cal. 1982);

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Symantec Corp. v. Logical Plus, Inc., 2009 U.S. Dist. LEXIS 86340, at * 4 (N.D. Cal.

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2009).)

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1500 PARK AVENUE, SUITE 300
EMERYVILLE, CA 94608
[phone]

KATZOFF & RIGGS LLP

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Therefore, the parties agree and stipulate that the action shall be severed as
follows:

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Plaintiffs’ claims for Intentional Interference of Contract and Fraudulent

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Conveyance against Patriot shall be severed from the action and shall proceed as a

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discrete, independent action. The severed action against Patriot shall be stayed pursuant

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to Bankruptcy Code § 362(a).

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Plaintiffs’ claims for Breach of Contract against ISR, Alter Ego Liability against

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ISR and Hamm, and Fraudulent Conveyance against Phoenix and ISR’s cross-claims

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shall proceed and shall not be stayed by Patriot’s Bankruptcy Petition.

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Dated: March 5, 2018

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KATZOFF & RIGGS LLP
/s/ Robert R. Riggs
By: ______________________________
Robert R. Riggs
Attorneys for Plaintiffs and CrossDefendants KAREN RIGSBY, Trustee
of the MARSH REVOCABLE TRUST
OF
2003,
and
DONALD
P.
_______________________________________________________________________
STIPULATION AND ORDER TO SEVER DEFENDANT PATRIOT NATIONAL, INC.

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STEINMEYER
Dated: February 28, 2018

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LAW OFFICES OF PETER DUNN
LEMMON

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/s/ Peter D. Lemmon
By: ______________________________
Peter Dunn Lemmon

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Attorneys for Defendant and CrossComplainant ISR HOLDINGS, INC.

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Dated: February 28, 2018
LAW OFFICE
HARPAINTER

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OF

DEWEY

V.

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/s/ Dewey V. Harpainter
______________________________
Dewey V. Harpainter

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Attorneys for Defendant KEVIN HAMM

1500 PARK AVENUE, SUITE 300
EMERYVILLE, CA 94608
[phone]

KATZOFF & RIGGS LLP

By:

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By the Court:
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Good cause appearing, IT IS SO ORDERED.
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Dated: March 14, 2018

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_______________________________________________________________________
STIPULATION AND ORDER TO SEVER DEFENDANT PATRIOT NATIONAL, INC.

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