Casados v. Drury et al
ORDER Denying The Ameritas Defendants' Motion For Partial Reconsideration of Order Granting In Part and Denying In Part the Ameritas Defendants' Motion For Summary And Final Judgment, Order Filed June 30, 2014 re 124 Order on Motion for S ummary Judgment. This order supercedes the July 18, 2014 summary ruling 135 . Signed by JUDGE LESLIE E. KOBAYASHI on 7/31/14. (gab, )CERTIFICATE OF SERVICEParticipants registered to recei ve electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
LORI A. DRURY; AMERITAS LIFE )
INSURANCE CORP.; DIANE PEREZ; )
GRACE CASADOS MARTINEZ; PETRA )
WILLIAMS; PATRICIA DIANE
JACOBS; ESTATE OF SAMUEL
FRANCISCO CASADOS; JOHN
and/or JANE DOES 1-20; DOE
CIVIL NO. 13-00283 LEK-RLP
ORDER DENYING THE AMERITAS DEFENDANTS’ MOTION FOR PARTIAL
RECONSIDERATION OF ORDER GRANTING IN PART AND DENYING
IN PART THE AMERITAS DEFENDANTS’ MOTION FOR SUMMARY AND FINAL
JUDGMENT, ORDER FILED JUNE 30, 2014 (DOCUMENT # 124)
On June 30, 2014, this Court issued its Order Granting
in Part and Denying in Part the Ameritas Defendants’ Motion for
Summary and Final Judgment (“6/30/14 Order”).1
[Dkt. no. 124.2]
On July 14, 2014, the Ameritas Defendants filed a motion for
partial reconsideration of the 6/30/14 Order (“Motion for
[Dkt. no. 128.]
The Court issued its summary
ruling denying the Motion for Reconsideration on July 18, 2014.
Defendants Ameritas Life Insurance Corp. (“Ameritas”) and
Lori A. Drury (“Drury,” collectively “the Ameritas Defendants”)
filed their Motion for Summary and Final Judgment (“Summary
Judgment Motion”) on February 7, 2014. [Dkt. nos. 58-69.]
The 6/30/14 Order is also available at 2014 WL 2968221.
[Dkt. no. 135.]
The instant order is this Court’s decision on
the Motion for Reconsideration, and this order supercedes the
July 18, 2014 summary ruling.
After careful consideration of the Motion for
Reconsideration, the supporting memorandum, and the relevant
legal authority, the Court HEREBY DENIES the Motion for
Reconsideration because it is merely an impermissible rehash of
its original arguments, and for the reasons set forth below.
In the 6/30/14 Order, this Court, inter alia, granted
summary judgment in favor of the Ameritas Defendants as to:
•Count I for bad faith, insofar as the Complaint alleged bad
faith in violation of Haw. Rev. Stat. Chapter 431, and bad
faith under Hawai`i common law against Drury;
•Count IV for conversion, against the Ameritas Defendants; and
•the Ameritas Defendants’ Cross–Claim and the Casados Defendants’
The Court denied summary judgment to the Ameritas Defendants as
•Count I for bad faith, insofar as the Complaint alleged bad
faith under Hawai`i common law against Ameritas;
•Count III, for violation of Hawaii’s Unfair and Deceptive Act or
Practices (“UDAP”) law against the Ameritas Defendants;
•the Ameritas Defendants’ Counterclaim (“Counterclaim”) against
The Casados Defendants are Petra Williams, Grace Casados
Martinez, Patricia Diane Jacobs, and the Estate of Samuel
Francisco Casados. See 6/30/14 Order, 2014 WL 2968221, at *1 &
Plaintiff Yoko Casados (“Plaintiff”);
•the Counterclaim against the Casados Children,4 insofar as it is
•the Ameritas Defendants’ request for final judgment on any of
6/30/14 Order, 2014 WL 2968221, at *11.
In the instant Motion for Reconsideration, the Ameritas
Defendants argue that this Court’s denials of summary judgment to
the Ameritas Defendants on Counts I and III were manifest errors
and should be reversed.
They do not dispute the rulings in their
favor and argue that the Summary Judgment Motion is moot as to
the Counterclaim since they filed their First Amended
Counterclaim on July 8, 2014.
In order to obtain reconsideration of the 6/30/14
Order, the Ameritas Defendants’ Motion for Reconsideration “‘must
accomplish two goals.
First, a motion for reconsideration must
demonstrate reasons why the court should reconsider its prior
Second, a motion for reconsideration must set forth
facts or law of a strongly convincing nature to induce the court
See Davis v. Abercrombie, Civil
to reverse its prior decision.’”
No. 11-00144 LEK-BMK, 2014 WL 2468348, at *2 (D. Hawai`i June 2,
2014) (quoting Donaldson v. Liberty Mut. Ins. Co., 947 F. Supp.
429, 430 (D. Hawai`i 1996)).
This district court recognizes
The Casados Children are Charles Lee and Lisa Ann Casados.
three circumstances where it is proper to grant reconsideration
of an order: “(1) when there has been an intervening change of
controlling law; (2) new evidence has come to light; or (3) when
necessary to correct a clear error or prevent manifest
Tierney v. Alo, Civ. No. 12-00059 SOM/KSC, 2013 WL
1858585, at *1 (D. Hawai`i May 1, 2013) (citing School District
No. 1J v. ACandS, Inc., 5 F.3d 1255, 1262 (9th Cir. 1993)).
The Ameritas Defendants do not provide a standard of
review in their memorandum in support of the Motion for
Reconsideration, but it appears that they have brought the Motion
for Reconsideration under the third ground for relief:
court should reconsider the 6/30/14 Order to correct clear
Although they purport to point out errors, in essence,
the Ameritas Defendants reargue the same points that the Court
rejected in the 6/30/14 Order without clearly pointing out how
exactly the Court erred, and raise new arguments based on the
Court’s conclusions, which could have been raised their memoranda
in support of the Summary Judgment Motion.
The Court CAUTIONS
the Ameritas Defendants that a reconsideration motion is not a
clean slate upon which movants are invited to reargue their
briefs or to raise new arguments, and the Court need not consider
these types of arguments.
See, e.g., Marlyn Nutraceuticals, Inc.
v. Mucos Pharma GmbH & Co., 571 F.3d 873, 880 (9th Cir. 2009) (“A
motion for reconsideration may not be used to raise arguments or
present evidence for the first time when they could reasonably
have been raised earlier in the litigation.” (citation and
internal quotation marks omitted)); Nat’l Union Fire Ins. Co. of
Pittsburgh, Pa. v. Am. Eurocopter Corp., NO. CV. 09-00136
DAE-LEK, 2009 WL 3424969, at *3 (D. Hawai`i Oct. 26, 2009)
(“repetition of the same arguments does not meet the actual
burden upon Plaintiff in a motion for reconsideration” (some
citations omitted) (citing Backlund v. Barnhard, 778 F.2d 1386,
1388 (9th Cir. 1985)).5
Though the Court could rest on the
conclusion that the arguments in the Ameritas Defendants’
memorandum are improper, it addresses the specific arguments for
completeness as follows.
First, the Ameritas Defendants argue that the Court
erred in finding that there was a genuine issue of material fact
as to Plaintiff’s bad faith claim because Plaintiff had no right
to the Proceeds and thus the Ameritas Defendants’ actions could
not have caused Plaintiff any damage.
[Mem. in Supp. of Motion
The Ameritas Defendants also misstate the 6/30/14 Order in
multiple places in an attempt to reargue points that the Court
rejected. For example, they argue that the 6/30/14 Order does
not address a purported disclaimer by Plaintiff of her claim to
the insurance proceeds (“the Proceeds”) at issue in the case.
[Mem. in Supp. of Motion for Reconsideration at 5-6.] In fact,
the Court expressly considered both the disclaimer itself and the
communications surrounding the disclaimer as offered by both
parties, and explicitly rejected the Ameritas Defendants’
arguments. 2014 WL 2968221, at *7-8.
for Reconsideration at 6-9.]
This simply is not what the law
Both the 6/30/14 Order and the Ameritas Defendants’
memorandum in support of the Motion for Reconsideration cite
Enoka v. AIG Hawaii Insurance Co., 109 Hawai`i 537, 128 P.3d 850
That case unequivocally states that a bad faith claim
for insurance claim mishandling, like Plaintiff’s, does not
require that the claimant actually be covered under the policy:
Although [International Brotherhood of
Electrical Workers Local 1357 v. American
International Adjustment Co., 955 F. Supp. 1218
(D. Haw. 1997), aff’d mem., 142 F.3d 443 (9th Cir.
1998)] broadly held that an independent claim for
breach of the covenant of good faith and fair
dealing will not lie where there is no coverage
liability on the underlying policy, its holding
was premised on the reasoning that an insurer has
no duty to investigate a claim that is excluded by
the clear and unambiguous language in the
insurance policy. Thus, it would follow that an
insured could not recover for the tort of a bad
faith failure to investigate where the insured
could not establish liability on the part of the
insurer on the underlying policy. Here, on the
other hand, Enoka is essentially asserting that
AIG acted in bad faith when it denied her claim
for no-fault benefits on an invalid basis. In
other words, Enoka’s bad faith claim is premised
upon AIG’s alleged mishandling of her claim, which
is distinguishable from a bad faith failure to
investigate her claim. As this court stated in
Best Place[, Inc. v. Penn America Insurance Co.,
82 Hawai`i 120, 920 P.2d 334 (1996)], the insurer
may commit bad faith, “whether the carrier pays
the claim or not.” 82 Hawai`i at 132, 920 P.2d at
346 (emphasis added); see also Francis v. Lee
Enterprises, Inc., 89 Hawai`i 234, 971 P.2d 707
(1999) (noting that, in Best Place, “[w]e further
explained that an action for the tort of ‘bad
faith’ will lie . . . when an insurance company
unreasonably handles or denies payment of a
claim”) (emphases added). Surely an insurer must
act in good faith in dealing with its insured and
in handling the insured’s claim, even when the
policy clearly and unambiguously excludes
coverage. Inasmuch as Enoka has alleged that AIG
handled the denial of her claim for no-fault
benefits in bad faith, we conclude that she is not
precluded from bringing her bad faith claim even
where there is no coverage liability on the
underlying policy. Accordingly, we hold that the
trial court erred in determining that, because
Enoka’s breach of contract claim failed, her bad
faith claim must fail.
Id. at 551-52, 128 P.3d at 864-65 (some alterations in Enoka)
Plaintiff here is making a mishandling claim, not a
failure to investigate claim, and thus she need not prove that
she is entitled to the Proceeds.
In Enoka, the Hawai`i Supreme
Court upheld the denial of the bad faith claim because it held
that the insurer reasonably interpreted open issues of law.
at 552-53, 128 P.3d at 865-66.
Here, the Court found in the
6/30/14 Order that there was a genuine issue of material fact as
to whether the Ameritas Defendants acted in bad faith toward
Plaintiff in communicating unequally with the parties,
obfuscating the claim processing procedures, and disbursing the
Proceeds while Plaintiff was pursuing her claim.
2968221, at *4-8.6
Thus, the Court did not err (let alone
The cases the Ameritas Defendants cited in the Motion for
Reconsideration, which were all decided prior to the 6/30/14
Order and thus should have been argued along with the Summary
Judgment Motion, are not to the contrary. See J.H. ex rel. Kirk
v. Baldovinosre, Nos. 12-15372, 12–16242, 12–16411, 2014 WL
clearly err) in not reaching the issue of whether Plaintiff was
actually entitled to the Proceeds, since the evidence she
offered, taken in the light most favorable to Plaintiff, shows
that she could prevail on her bad faith claim.7
Second, the Ameritas Defendants argue that Plaintiff’s
UDAP claim must fail because she has not suffered any injury.
[Mem. in Supp. of Motion for Reconsideration at 9-10.]
the first time that they have raised this argument and,
therefore, the Court rejects it for that reason.
Marlyn Nutraceuticals, 571 F.3d at 880.
In addition, the cases
that the Ameritas Defendants now cite, which were also available
to them before the 6/30/14 Order, support the sufficiency of the
evidence Plaintiff put forth in support of her UDAP claim, see,
3703026, at *1 (9th Cir. July 28, 2014) (“a district court has
discretion not to consider an issue first raised in a motion for
reconsideration” (citing Novato Fire Prot. Dist. v. United
States, 181 F.3d 1135, 1141 n. 6 (9th Cir. 1999))). In Illinois
National Insurance Co. v. Nordic PCL Construction, Inc., Civil
No. 11-00515 SOM/KSC, 2012 WL 5386609, at *15-17 (D. Hawai`i Oct.
31, 2012), the district court found that, at best, the insurer’s
failure to pay was an error, and not done in bad faith. And, in
Yano v. Government Employees Insurance Co., Civil No. 11-00745
SOM/BMK, 2012 WL 5037694, at *10 (D. Hawai`i Oct. 17, 2012), the
district court found no evidence of mishandling of the claim.
Thus, these cases, while consistent with Enoka, are
distinguishable from this case.
The Ameritas Defendants spend more than five additional
pages rearguing the factual point that Plaintiff had no right to
the Proceeds under the Policy. [Mem. in Supp. of Motion for
Reconsideration at 10-16.] The Court did not reach this argument
in the 6/30/14 Order and does not find it determinative for the
reasons set forth above.
e.g., Hawaii Med. Ass’n v. Hawaii Med. Serv. Ass’n, 113 Hawai`i
77, 114 n.32, 148 P.3d 1179, 1216 n.32 (2006) (finding allegation
that the plaintiff “was required to divert substantial resources
and time” was sufficient to withstand motion to dismiss); cf.
Flores v. Rawlings Co., LLC, 117 Hawai`i 153, 169, 177 P.3d 341,
357 (2008) (holding that “a plaintiff sufficiently alleges injury
for purposes of standing by alleging that the plaintiff was made
to pay money that was ‘wrongfully induced’” (discussing Ai v.
Frank Huff Agency, Ltd., 61 Haw. 607, 607 P.2d 1304 (1980)).
Since the Court does not find that these cases support
reconsideration, it rejects this argument.
Last, the Ameritas Defendants argue that the Court did
not provide a proper legal basis for its finding that there is a
genuine issue of material fact as to whether the Ameritas
Defendants owed a good faith duty to Plaintiff as of at least
[Mem. in Supp. of Motion for Reconsideration at
This is largely a reiteration of the first argument,
which was improperly brought in the Motion for Reconsideration
since it was previously rejected, see 6/30/14 Order, 2014 WL
2968221, at *3-7, and rejected again in this Order, see supra.
Substantively, Plaintiff provided evidence that, on
multiple occasions, the Ameritas Defendants admitted that they
should initiate an interpleader action; they did not do so, nor
does it appear from the evidence that they actively investigated
the claim, but rather, viewed in the light most favorable to
Plaintiff, they continued to communicate with the Casados
Defendants and attempted to resolve the claim in their favor.
These facts are sufficient, under the case law set forth in
the 6/30/14 Order, 2014 WL 2968221, at *3, for Plaintiff to raise
a material dispute as to her bad faith claim.
Thus, the Court
rejects the Ameritas Defendants’ argument that the Court clearly
erred in reaching and supporting its finding.8
Since the Court finds no basis to reconsider the
6/30/14 Order, see Davis, 2014 WL 2468348, at *2, or any clear
error or manifest injustice, see Tierney, 2013 WL 1858585, at *1,
the Court DENIES the Motion for Reconsideration.
On the basis of the foregoing, the Ameritas Defendants’
“Motion for Partial Reconsideration of Order Granting in Part and
Denying in Part the Ameritas Defendants’ Motion for Summary and
Final Judgment, Order Filed June 30, 2014 (Document # 124),”
filed July 14, 2014, is HEREBY DENIED in its entirety.
IT IS SO ORDERED.
The Court reminds the Ameritas Defendants that it is their
duty to persuade the Court, by citing to relevant legal
authority, that they should prevail, and the Court does not look
favorably upon arguments that the Court failed to cite sufficient
legal authority and that it misinterpreted the evidence before
it, when they do not agree with the ruling.
DATED AT HONOLULU, HAWAII, July 31, 2014.
/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge
YOKO CASADOS VS. LORI A. DRURY, ET AL; CIVIL 13-00283 LEK-RLP;
ORDER DENYING THE AMERITAS DEFENDANTS’ MOTION FOR PARTIAL
RECONSIDERATION OF ORDER GRANTING IN PART AND DENYING IN PART THE
AMERITAS DEFENDANTS’ MOTION FOR SUMMARY AND FINAL JUDGMENT, ORDER
FILED JUNE 30, 2014 (DOCUMENT # 124)
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