Ranger Pipelines Incorporated v. Lexington Insurance Company

Filing 25

ORDER by Judge Hamilton granting 7 Motion to Dismiss (pjhlc1, COURT STAFF) (Filed on 1/10/2013)

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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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RANGER PIPELINES, INC.,
Plaintiff,

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v.

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For the Northern District of California

United States District Court

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ORDER GRANTING MOTION
TO DISMISS

LEXINGTON INSURANCE COMPANY,

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No. C 12-5387 PJH

Defendant.
_______________________________/

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Defendant’s motion to dismiss the complaint pursuant to Federal Rule of Civil

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Procedure 12(b)(6) came on for hearing before this court on January 9, 2013. Plaintiff

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Ranger Pipelines, Inc. (“Ranger”) appeared by its counsel Jon Brick, and defendant

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Lexington Insurance Company (“Lexington”) appeared by its counsel Wayne Glaubinger,

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Sara Parker, and John Mezzacappa. Having read the parties’ papers and carefully

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considered their arguments and the relevant legal authority, the court hereby GRANTS the

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motion as follows for the reasons stated at the hearing.

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In this insurance dispute, Ranger seeks benefits as an additional insured under a

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Master Builder’s Risk Policy (“the Policy”) issued by Lexington to the Regents of the

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University of California (“Regents”) for the period September 1, 2005, through September

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1, 2008 (later extended through August 31, 2009), in connection with the construction of the

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Mission Bay Utilities and Distribution Phase I project at the University of California - San

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Francisco (“UCSF”) Mission Bay campus (“the Mission Bay Project”).

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The Regents entered into various contracts with design professionals and
contractors for the design and construction of the Mission Bay Project. On September 27,

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2007, the Regents and Ranger entered into a contract pursuant to which Ranger agreed to

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build the utility pipe and vault system for the Project. There appears to be no dispute that

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Ranger is an additional insured under the Policy based on its contract with the Regents in

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connection with the construction at the Mission Bay Project.

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The Policy defines “Occurrence” as “any one loss, disaster, casualty, accident,

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incident, or series of one or more of the following arising out of a single event or originating

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cause during the Policy term and including all resultant or concomitant losses wherever

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located.” Section 25 of the Policy provides, in part, that “[a]ny action or proceeding against

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the Company for recovery of any loss under this Policy will not be barred if commenced
within (12) months after the OCCURRENCE becomes known to the Insured unless a

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For the Northern District of California

United States District Court

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longer period of time is provided by applicable statute.

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In February 2009, it was discovered that water had entered into and had adversely

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impacted portions of the Mission Bay Project, including portions installed by Ranger.

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Ranger alleges that this water entered the system and damaged it when persons or entities

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other than Ranger operated the piping systems at temperatures that were higher than was

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appropriate. Ranger also claims that the piping selected for the Project (by persons or

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entities other than Ranger) was not suitable or appropriate for the use to which it was put.

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The Regents allegedly tendered a claim to Lexington for coverage under the Policy.

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Lexington determined there was coverage, and paid the Regents a sum of money under

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the Policy. Ranger subsequently made a claim under the Policy, but Lexington denied

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Ranger’s claim. Ranger filed the present action in September 2012. Lexington argues that

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the action must be dismissed because it is time-barred. Ranger asserts that the limitations

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period was equitably tolled. However, the complaint does not clearly set forth a basis for

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application of equitable tolling.

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At the hearing, the court granted the motion, and advised the parties that the only

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question for determination is whether the one-year period should be equitably tolled, but

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that the complaint was lacking in specific details and did not allege facts sufficient to

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support Ranger’s claim of equitable tolling.
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Accordingly, the court indicated that, at a minimum, the following must be alleged in

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any amended complaint: (1) the date Ranger’s work on the Project was completed; (2) the

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date the water damage occurred; (3) the date the Regents discovered or learned about the

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water damage; (4) the date Ranger discovered or learned about the water damage, and

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how Ranger learned about it; (5) the date the Regents submitted the claim for the water

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damage to Lexington; (6) what the claim covered; (7) the date Ranger learned that the

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Regents had submitted the claim to Lexington; (8) whether the Regents ever sought

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compensation from Ranger for the water damage, and if so, when; (9) whether the Regents

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assert that Ranger was responsible for all, or part of, the water damage; and
(10) whether Ranger submitted a claim separate from the claim submitted by the Regents,

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For the Northern District of California

United States District Court

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and if so, when it was submitted and what it covered.

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The amended complaint shall be filed no later than February 6, 2013, and any

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responsive pleading or further motion to dismiss shall be filed no later than 21 days after

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the date the amended complaint is filed. In addition, in any subsequent motion to dismiss,

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the parties shall set forth the standard to be applied with regard to pleading equitable

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tolling.

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IT IS SO ORDERED.

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Dated: January 10, 2013
______________________________
PHYLLIS J. HAMILTON
United States District Judge

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