Maryland Casualty Company et al v. Dublin Eye Associates, P.C. et al
Filing
50
ORDER denying Plaintiffs' Maryland Casualty Company and Foremost Signature Insurance Company's 27 Motion for Partial Summary Judgment; denying Defendant Dr. James Y. Jones' 29 Motion for Partial Summary Judgment. Signed by Chief Judge Lisa G. Wood on 3/23/2017. (ca)
In
?linttel)i States: Btsdrict Court
for tl^e ^outl^em Btotnrt of Georgia
IBubltn BtbtOton
FILED
Scott L. Poff, Clerk
United States District Court
By casbell at 4:28 pm, Mar 23, 2017
MARYLAND CASUALTY COMPANY and
FOREMOST SIGNATURE INSURANCE
COMPANY,
Plaintiffs,
CV 315-81
V.
DUBLIN EYE ASSOCIATES, P.C.,
DR. ROGER D. SMITH
and DR. JAMES Y. JONES,
Defendants.
ORDER
Pending before the Court is Plaintiffs' Maryland Casualty
Company
(""MCC")
(^^Foremost")
and
Foremost
(collectively
Signature
^'Plaintiffs")
Insurance
Motion
for
Company's
Partial
Summary Judgment (Dkt. No. 27) and Defendant Dr. James Y. Jones'
("Defendant") Partial Motion for Summary Judgment (Dkt. No. 29).
For the reasons set forth below, both motions are DENIED.
FACTUAL BACKGROUND
Many of facts of this case are not in dispute.
13,
On April
2011,
an
Employee
lawsuit
against
Retirement
Defendant
Income
Massachusetts
A0 72A
(Rev. 8/82)
and
two
Security
Mutual
Life
other
Act
parties
filed
("ERISA")
Insurance
("Mass.
Life")
in
the
Eastern District of Kentucky.
District
of
Kentucky
(Dkt. No. 1 SI 13).
ultimately
granted
summary
The Eastern
judgment
in
Mass. Life's favor on July 12, 2013.
Dublin Eye Assocs., P.C.
V.
Supp.
Mass.
2013).
Mut.
On
Life
August
Ins.
12,
Co.,
2013,
957
F.
Mass.
Life
2d
843 (E.D.
filed
a
claim
attorney's fees pursuant to 29 U.S.C. § 1132(g)(1).
Ky.
for
On March
24, 2014, Mass. Life's motion for attorney's fees was granted.
Dublin Eye Assocs., P.C. v. Mass. Mut. Life Ins. Co., 2014 WL
1217664, No. 5:ll-cv-128 (E.D. Ky., Mar. 24, 2014).
Defendant
and his co-plaintiffs in the underlying lawsuit were ordered to
pay $1,191,799.99 in attorney's fees.
Dkt. No. 1 f 22.
On May
4, 2015, Plaintiffs were notified of the judgment and the award
of attorney's fees.
At the time of the award of attorney's fees, MCC insured
Defendant with the following policy (the
Policy"):
We will pay those sums that the insured becomes
legally
obligated
to
pay
as
damages
because
of
^^personal
and
advertising
injury" to
which
this
insurance applies.
We will have the right and duty to
defend the insured against any '"suit" seeking those
damages.
However, we will have no duty to defend the
insured
against
any
^^suit"
seeking
damages
for
^'personal
and
advertising
injury" to
which
this
insurance does not apply.
We may, at our discretion,
investigate any offense and settle any claim or ^'suit"
that may result.
(Dkt. No. 1 2 28).
Further,
the
Policy
defined
a
^'personal
and
advertising
injury" arising out of the offense of ^^malicious prosecution"
(as
well as
case).
a
number
of other offenses
not at issue in
this
Plaintiffs and Defendant now each seek summary judgment
regarding the coverage under the Policy.
LEGAL STANDARD
The party seeking summary judgment bears the initial burden
of
demonstrating
fact.
the
absence
of
a
genuine
issue
of
material
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
To
satisfy this burden, the movant must show the court that there
is an absence of evidence to support the nonmoving party's case.
Id. at 325.
If the moving party discharges this burden, the
burden shifts to the nonmovant to go beyond the pleadings and
present
affirmative
evidence
to
show
that
a
genuine
issue
of
fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
257 (1986).
The nonmovant may satisfy this burden in two ways:
the
nonmovant
^^may
show
that
the
record
in
fact
First,
contains
supporting evidence, sufficient to withstand a directed verdict
motion, which was
^overlooked or ignored' by the moving party,
who has thus failed to meet the initial burden of showing an
absence
of evidence."
Fitzpatrick
v. City of Atlanta, 2 F.3d
1112, 1116 (11th Cir. 1993) (quoting Celotex Corp., 477 U.S. at
332 (Brennan, J., dissenting)).
forward
directed
with
additional
verdict
motion
Second, the nonmovant ^^may come
evidence
at
sufficient
trial
based
to
on
withstand
the
a
alleged
evidentiary
deficiency."
JA.
at
1117.
Where
the
nonmovant
instead attempts to carry this burden with nothing more ""'than a
repetition of his conclusional allegations, summary judgment for
the defendants [is] not only proper but required."
Ross, 663 F.2d 1032, 1033-34 (11th Cir. 1981).
Morris v.
When, as here,
the parties have filed cross-motions for summary judgment, the
applicable Rule 56 standard is not affected.
Reinsurance Corp. of Am. v.
(11th
Cir.
2001). 'MT]he
favorable to the
Mercantil
facts
non-moving
Commercebank,
Gallagher, 267
are
viewed
party on each
N.A.,
701
F.3d
See Gerlinq Glob.
F.3d 1228, 1233-34
in
the
light
most
motion." Chavez v.
896,
899
(11th
Cir.
2012).
DISCUSSION
Both Plaintiffs and Defendant petition the Court to answer
the same question: whether the facts from the underlying lawsuit
could
be
said
to
support
an
^^obligation
malicious prosecution" under the policy.
Dkt.
No.
claims
29;
Dkt.
that the
No. 29-1
facts
pp. 1-5.
surrounding
the
to
pay
damages
for
Dkt. No. 27-1 p. 6;
Specifically,
underlying
Defendant
lawsuit
were
such that the grant of attorney's fees was the equivalent to a
malicious prosecution action.
urge the opposite conclusion.
Dkt. No. 29-1 p. 7.
Plaintiffs
The parties agree that Georgia
contract interpretation laws apply to the
Policy and
Kentucky
law governs what constitutes malicious prosecution.
Dkt. No. 29
pp. 6-7; Dkt. No. 33 pp. 1-2.
A policy which covers ^'malicious prosecution" indemnifies
only claims that meet the elements of the state law definition
of that action.
Atlanta Mut. Ins. Co. v. Atlanta Datacom, Inc.,
139 F.3d 1344, 1345-46 {11th Cir. 1998).
defendant
made
a
similar
argument as
under an identical policy.
The Atlanta
Defendant in
Datacom
this
case,
The Atlanta Datacom defendant argued
that ^^malicious prosecution" includes improper commencement of
civil
as
well
as
criminal
Circuit
rejected
this
confines
"malicious
prosecution.
argument,
holding
prosecution"
criminal actions, not civil ones.
to
the
Id.
The
that
improper
Eleventh
Georgia
pursuit
law
of
Id.
The Court deals with a similar situation in this case, with
important
differences.
To
begin
Kentucky, rather than Georgia law.
with,
the
Court
considers
Velten v. Regis B. Lippert
Interest, Inc., 985 F.2d 1515, 1521 (11th Cir. 1993).
Further,
unlike Georgia, Kentucky does provide a cause of action for both
criminal and civil malicious prosecution.
S.W.3d
,
Martin v. 0^Daniel,
, 2014-SC-000394-DG, 2016 WL 5244518 (Ky.
Sept. 22, 2016).
Since the
tort of malicious prosecution is disfavored in
the law, a plaintiff must strictly comply with the elements of
the tort.
Davidson v. Castner-Knott Dry Goods Co., 202 S.W.3d
597, 602 (Ky. Ct. App. 2006).
To be successful on a malicious
prosecution claim, a plaintiff must establish that:
[1] the defendant initiated, continued, or procured a . . .
civil proceeding . . . against the plaintiff; [2] the
defendant acted without probable cause; [3] the defendant
acted with malice, which . . . in the civil context, means
seeking
to
achieve
a
purpose
other
than
the
proper
adjudication of the claim upon which the underlying
proceeding was based; [4] the proceeding, except in ex
parte
civil
actions,
terminated
in
favor
of
the
against whom it was brought; and [5] the
suffered damages as a result of the proceeding.
person
plaintiff
Martin, 2016 WL 5244518, at *8.
The Court considers each element in turn.
As to the first
element, it is undisputed that Defendant was one of the parties
that initiated the
underlying lawsuit.
Plaintiffs argue that
one needs to have been a ^'defendant" in the underlying lawsuit
in order to satisfy the first element of a malicious prosecution
action.
shows
Dkt. No. 46 p. 5.
that
^'defendant"
Not so.
means
one
The Martin decision itself
who
brought
the
underlying
action, not that such a party needed to be a defendant in that
underlying action.
See generally Martin, 2016 WL 5244518.
To
find otherwise would mean that a party would need to be sued for
malicious prosecution as a defendant before they could sue for
malicious prosecution as a plaintiff.
The
second
element
requires
consideration
of
whether
the
underlying lawsuit was brought in the absence of probable cause.
Id.
at
*7-8.
Kentucky
courts
have
noted
the
difficulty
of
applying the second element of malicious prosecution in a civil
case,
as
law.
Prewitt v. Sexton, 777 S.W.2d 891, 894
Supreme
probable
Court
of
cause is
Kentucky
a
standard
has
defined
borrowed
from
criminal
{Ky. 1989).
probable
cause
in
The
the
civil context as a reasonable belief based in ^'the existence of
the facts upon which the claim is based, and . . . that under
those facts the claim may be valid under the applicable law."
Id.
Furthermore, the
determination
of
whether
the
action
was
brought with probable cause is a question for the Court rather
than the jury.
Here,
JA. at 895.
Defendant's
actions
in
the
underlying
lawsuit
indicate that the action was brought without any basis in law or
fact in
entitled
which
to
Defendant could
relief.
As
the
have
court
reasonably believed he
in
the
Eastern
District
was
of
Kentucky found, the Defendant knew or should have known of the
facts needed to bring his suit decades before it was actually
brought.
Dublin
Eye, 2014
WL 1217664, at *5.
Defendant
was
told that his claim was barred by the statute of limitations,
yet he brought the suit anyway.
JA.
As such. Defendant brought
the underlying lawsuit without probable cause.
As to the third element, malice, the Court must find that
Defendant brought or continued litigating the underlying lawsuit
for a purpose other than the proper adjudication of his claim.
Martin, 2016 WL 5244518, at *8.
This third element focuses on
Defendant's
motivation
in
bringing
and
continuing
the
suit.
There is a factual dispute as to whether Defendant acted with
malice.
Id.
at
This issue of fact must be decided by the factfinder.
*3.
As
such,
there
exists
a
genuine
issue
of
fact
regarding the third element that precludes summary judgment in
favor of either party.
Regarding
underlying
Plaintiff
'^judgment
underlying
the
fourth
action
argues
on
the
was
that
terminated
the
merits."
judgment
in
element,
the
in
Court
favor
underlying
Dkt.
fact
did
No.
46
finds
of
judgment
p.
rule '^on
6.
Mass.
was
the
Life.
.not
However,
the
section aptly titled '^Success On the Merits."
that
a
the
merits" in
a
Therefore, the
Court finds that Defendant satisfies this element.
Finally, the Court finds there is no dispute regarding the
final element, that Mass. Life must have suffered damages as a
result of the underlying lawsuit.
The suit itself is brought to
recover the ^Mamages" that Mass. Life suffered in the underlying
lawsuit
and
which
Defendant
claims
his
policy
now
covers.
Defendant meets this element as well.
While there is no genuine issue of fact as to four of the
five elements of malicious prosecution, there is such an issue
as to malice.
denied.
Therefore, both summary judgment motions will be
CONCLUSION
For the reasons stated above. Plaintiffs' Maryland Casualty
Company
Motion
and
for
James Y.
Foremost
Summary
Signature
Judgment
Insurance
(Dkt.
Jones' Partial Motion for
No.
27)
Company's
and
Partial
Defendant
Summary Judgment
{Dkt.
29) are both DENIED.
SO ORDERED, this 23rd day of March, 2017.
LISff^GODBEY W00», CHIEF JUDGE
UNITED STATES DISTRICT COURT
SOUTHERN
A0 72A
(Rev. 8/82)
DISTRICT OF GEORGIA
Dr.
No.
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