Phoenix Insurance Company, The et al v. Cantex, Inc. et al

Filing 91

ORDER granting Plaintiff's 90 Motion to Re-open Case. Landmark's Motion to Join Travelers' Motion To Re-Open Case [# 90 ], filed March 6, 2014, is GRANTED. By Judge Robert E. Blackburn on 5/19/2014.(klyon, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Robert E. Blackburn
Civil Case No. 13-cv-00507-REB-BNB
THE PHOENIX INSURANCE COMPANY, ET AL.,
Plaintiffs,
v.
CANTEX, INC., ET AL.,
Defendants.

ORDER GRANTING PLAINTIFFS MOTION TO RE-OPEN CASE
Blackburn, J.
The matters before me are (1) Plaintiffs [sic] Motion To Re-Open Case [#78],1
filed January 31, 2014; and (2) Landmark’s Motion to Join Travelers’ Motion To ReOpen Case [#90], filed March 6, 2014. I grant the motions.
I. JURISDICTION
This court has jurisdiction over this matter pursuant to 28 U.S.C. §1332 (diversity
of citizenship).
II. STANDARD OF REVIEW
A case that is administratively closed under D.C.COLO.LCivR 41.2 may be
reopened for good cause shown. Generally, there is good cause to reopen when
parties seek to litigate remaining issues that are ripe for review. American Family

1

“[#78]” is an example of the convention I use to identify the docket number assigned to a
specific paper by the court’s case management and electronic case filing system (CM/ECF). I use this
convention throughout this order.

Mutual Insurance Co. v. Teamcorp, Inc., 835 F.Supp.2d 1083, 1086 (D. Colo. 2011).
Nevertheless, courts may exercise discretion by denying a motion to reopen where the
relief sought would be futile. Id.
III. ANALYSIS
This is an action for declaratory judgment and other relief arising from a lawsuit
brought by defendant, Cantex, Inc. (“Cantex”), against defendant, RBR Construction
(“RBR”), seeking the cost to replace allegedly defective concrete installed at Cantex’s
Kingman, Arizona, manufacturing facility.2 RBR claimed that it was entitled to a defense
as an additional insured under various policies of insurance issued by plaintiffs to
defendant, Concrete Management Company (“CMC”). Plaintiffs defended RBR in the
underlying action under a reservation of rights. By this action, plaintiffs seek a
declaration that they had no duty to defend or indemnify either CMC or RBR in the
underlying action.
At the time this suit was filed in February 2013, however, the underlying action
was still ongoing. Ultimately, a trial was held in September 2013, resulting in a jury
determination that CMC was liable for eighty-five per cent (85%) of any damages
assessed against RBR. However, the question whether RBR was liable to Cantex was
tried to the court, which did not simultaneously render its determination on that issue.
While that determination was pending, plaintiffs moved to extend various pretrial
deadlines in this case. (See Plaintiffs’ Motion to Amend the Scheduling Order to
Extend Deadlines for Discovery Cutoff and the Filing of Dispositive Motions and

2

RBR was the general contractor on the project, and CMC was the concrete subcontractor.

2

for Expedited Briefing on This Motion [# 68], filed November 14, 2013.) Concluding
that “plaintiffs acted imprudently in rushing to this court” and that “neither they nor the
defendants they brought into the action are in any position to prepare for trial within the
normal time allowed by the district judge,” the magistrate judge recommended that the
case be administratively closed, “subject to reopening for good cause when, if ever, the
parties are in a position to prepare the case for trial.” (Recommendation of United
States Magistrate Judge and Order at 2-3 [#71], filed November 19, 2013.) I adopted
that recommendation and ordered this matter closed administratively. (See Order
Adopting Recommendation of United States Magistrate Judge and
Administratively Closing Case [#77], filed December 11, 2013.)
Shortly thereafter, the judge in the underlying action issued his determination that
RBR was liable to Cantex for nearly $3.7 million in damages. The transcript of the trial
was received by plaintiffs in mid-January 2014. This motion followed.
Herein, plaintiffs claim it is appropriate to reopen this matter because the underlying
action has been fully resolved, making their claims ripe for determination. Cantex,
however, objects that reopening would be futile and therefore urges that the motion be
denied.
Cantex’s primary argument in support of its position is that, by virtue of various
agreements among the defendants following the entry of judgment, it will seek to file
third-party claims against additional parties not currently joined herein,3 which allegedly
3

Following resolution of the claims in the underlying action, Cantex, CMC, RBR, and RBR’s
insurer, Old Republic Insurance Company (“ORIC”), entered into a Settlement Agreement, pursuant to
which RBR and CMC assigned to Cantex all relevant insurance coverage claims against their insurers.
Cantex represents that, if the case is reopened, it would seek to file claims against RBR’s insurers,

3

would destroy diversity jurisdiction.4 At this juncture, however, the filing of such claims
is purely hypothetical. Whether the inclusion of these parties would destroy diversity –
and what that might mean for the continuing viability of this case5 – are issues that must
await proper motion after the case is reopened.6
Nor is a response brief the appropriate vehicle for determining whether the suit
Cantex recently filed in Arizona state court seeking to collect its judgment in the
underlying action is the proper or superior forum for determining the rights of all
interested parties. Although these arguments may well implicate issues of comity and
abstention, Cantex has presented little more than its own ipse dixit to suggest that the
state court action should take precedence over this one. Questions regarding whether
one of these lawsuits must yield to the other cannot be forestalled prior to reopening of
the case.
For these reasons, I find and conclude that good cause exists to reopen this
case. Accordingly, plaintiffs’ motion will be granted.
Scottsdale Insurance Company (“Scottsdale”) and Princeton Excess and Surplus Lines Insurance
Company (“PESLIC”), who, like Cantex, are Delaware citizens.
4

Although Cantex invokes the language of Rule 19 in this instance, the court is not convinced
that the rule is properly employed in this circumstance. Moreover, Cantex neither cites or addresses the
relevant standards of Rule 19. See Center for Biological Diversity v. Pizarchik, 858 F.Supp.2d 1221,
1223-24 (D. Colo. 2012). Nor could it by way of its response to plaintiffs’ motion to reopen. See
D.C.COLO.LCivR 7.1(d) (“A motion shall not be included in a response or reply to the original motion. A
motion shall be made in a separate document.”).
5

Plaintiffs’ reply brief anticipates the court’s likely response to the addition of third-party claims
against these additional insurers. See Price v. Wolford, 608 F.3d 698, 702 (10th Cir. 2010) (“Ordinarily,
‘the jurisdiction of the Court depends upon the state of things at the time of the action brought, and . . .
after vesting, it cannot be ousted by subsequent events.’”) (quoting Mullan v. Torrance, 22 U.S. (9
Wheat.) 537, 539, 6 L.Ed. 154 (1824)).
6

Similarly, determination whether venue continues to be appropriate in this district if CMC, the
only Colorado defendant, is dropped as a named party defendant, is not ripe for determination in the
present posture of this case.

4

THEREFORE IT IS ORDERED as follows:
1. That Landmark’s Motion to Join Travelers’ Motion To Re-Open Case
[#90], filed March 6, 2014, is GRANTED;
2. That Plaintiffs [sic] Motion To Re-Open Case [#78], filed January 31, 2014,
is GRANTED; and
3. That under D.C.COLO.LCivR 41.2, the clerk is DIRECTED to reopen this civil
action.
Dated May 19, 2014, at Denver, Colorado.
BY THE COURT:

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