Kras v. Dick's R U Crazy, Inc. et al

Filing 33

OPINION AND ORDER GRANTING 20 Motion for Extension of Time to Respond to Plaintiff's Motion for Summary Judgment and ORDERS that Conifer's deadline for responding to Kras's Motion for Summary Judgment 17 is STAYED until 30 days after the close of discovery or the resolution of any discovery disputes, whichever comes later. Signed by Magistrate Judge John E Martin on 11/23/2016. (jss)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
HAMMOND DIVISION
NATHAN KRAS,
Plaintiff/Judgment Creditor,

)
)
)
v.
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)
CONIFER INSURANCE COMPANY,
)
Garnishee-Defendant,
)
____________________________________)
)
CONIFER INSURANCE COMPANY,
)
Counter Claimant,
)
)
v.
)
)
NATHAN KRAS,
)
Counter Defendant.
)

CAUSE NO.:2:16-CV-224-JD-JEM

OPINION AND ORDER
This matter is before the Court on a “Motion for Extension of Time to Respond to Plaintiff’s
Motion for Summary Judgment” [DE 20], filed by Garnishee-Defendant Conifer Insurance
Company on July 26, 2016. Conifer asks the Court to extend its deadline for responding to Plaintiff
Nathan Kras’s summary judgment motion until 30 days after the completion of discovery and the
resolution of any discovery disputes. Kras has responded, and Conifer has replied.
I.

Background
In September 2013, Nathan Kras was shot in the leg and abdomen outside a Hammond,

Indiana nightclub. Two years later, in September 2015, Kras sued the nightclub and its owners in
state court, alleging negligence. The nightclub owners had insurance with Conifer Insurance
Company, but Conifer denied the nightclub owners’ request for coverage for the attack. In Conifer’s
view, the policy provided coverage for the nightclub property only, not for the adjoining gravel
parking lot where Conifer said the attack occurred.

The state court litigation proceeded without Conifer’s involvement. In March 2016, Kras
served 28 admissions requests on the nightclub owners—the Court will refer to them as the
insureds—regarding the nature, extent, and amount of Kras’s injuries and damages, the location of
the attack, and the insureds’ fault with respect to the attack. The insureds fairly quickly agreed to
a consent judgment by which they admitted negligence and admitted to all 28 admissions requests.
The state court entered judgment against the insureds for $2,955,056—the amount of damages
identified in the consent judgment and in the admissions requests.
Having received judgment in his favor, in April 2016 Kras filed a motion for a proceeding
supplemental. Kras sought to garnish $2,955,056 from Conifer in satisfaction of the state court
judgment against the insureds. Conifer removed the case to federal court.
On July 20, 2016, Kras filed a motion for summary judgment. At the time, neither party had
conducted any discovery. But two days later, on July 22, 2016, Conifer served interrogatories and
document production requests on Kras.
Conifer now seeks to extend its deadline for responding to Kras’s summary judgment motion
until 30 days after the completion of discovery and the resolution of any discovery disputes. See Fed.
R. Civ. P. 56(d) (“If a nonmovant shows [that] it cannot present facts essential to justify its
opposition [to summary judgment], the court may: (1) defer considering the motion or deny it; (2)
allow time . . . to take discovery; or (3) issue any other appropriate order.”).
II.

Analysis
In general, the Court can extend a party’s deadline for responding to a summary judgment

motion if the party is unable to present facts essential to its opposition. Fed. R. Civ. P. 56(d); Celotex
Corp. v. Catrett, 477 U.S. 317, 326 (1986) (premature summary judgment motions “can be

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adequately dealt with under Rule 56(f) [now Rule 56(d)], which allows a summary judgment motion
to be denied, or the hearing on the motion to be continued, if the nonmoving party has not had an
opportunity to make full discovery”); Woods v. City of Chicago, 234 F.3d 979, 990 (7th Cir. 2000)
(“Rule 56(f) [now Rule 56(d)] authorizes a district court to refuse to grant a motion for summary
judgment or to continue its ruling on such a motion pending further discovery if the nonmovant . .
. demonstrat[es] why it cannot yet present facts sufficient to justify its opposition to the motion.”),
cert. denied 534 U.S. 955.
In a proceeding supplemental, a party is still entitled to discovery, although the Court has
discretion to limit or even eliminate discovery to ensure that the procedure for enforcing a judgment
remains swift and cheap. Symons Int’l Group, Inc. v. Cont’l Cas. Co., 306 F.R.D. 612, 617-18 (S.D.
Ind. 2014) (“Both state and federal rules . . . allow for discovery in proceedings supplemental, and
in considering the procedure by which discovery is conducted, the Court has considerable discretion
. . . . to fashion procedures ensuring that ‘[p]roceedings to enforce judgments’ remain ‘swift, cheap,
[and] informal.’”) (alterations in original) (quoting Resolution Trust Corp. v. Ruggiero, 994 F.2d
1221, 1226 (7th Cir. 1993)).
Here, Conifer argues that Kras’s summary judgment motion raises issues that require
discovery regarding what factual findings the trial court entered and whether the trial court’s
judgment amount was reasonable. Conifer says that it has not had an opportunity to obtain evidence
relating to those issues, and that good cause exists to extend Conifer’s response deadline because
Conifer has been diligent in its discovery efforts (for example, serving discovery requests on Kras
four days after answering Kras’s complaint). See Fed. R. Civ. P. 6(b) (“When an act may or must
be done within a specified time, the court may, for good cause, extend the time . . .”); Saul v. Prince

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Mfg. Corp., No. 12-270, 2013 U.S. Dist. LEXIS 8199, *3 (N.D. Ind. Jan. 22, 2013) (“The good
cause standard focuses on the diligence of the party seeking the extension.”).
Kras argues that no discovery is necessary. In Kras’s view, Conifer is bound by the result
of the state court lawsuit because Conifer, having had notice of the lawsuit and an opportunity to
control the proceedings, chose neither to defend its insureds nor to file a declaratory judgment
action. State Farm Fire & Cas. Co. v. T.B., 762 N.E.2d 1227, 1231 (Ind. 2002) (“The doctrine of
collateral estoppel applies to insurance contracts and an insurer is ordinarily bound by the result of
litigation to which its insured is a party, so long as the insurer had notice and opportunity to control
the proceedings.”) (quotation omitted).
A.

Discovery regarding the trial court’s factual findings

Kras is correct that collateral estoppel generally applies when an insurer abandons its insured
by neither defending under a reservation of rights nor seeking a declaratory judgment on the
coverage issues. State Farm Fire & Cas. Co. v. T.B., 762 N.E.2d 1227, 1231 (Ind. 2002) (“insurer
may avoid the effects of collateral estoppel by: (1) defending the insured under a reservation of
rights in the underlying tort action, or (2) filing a declaratory judgment action for a judicial
determination of its obligations under the policy”); see also Liberty Mut. Ins. Co. v. Metzler, 586
N.E.2d 897, 902 (Ind. Ct. App. 1992) (“An insurer, having knowledge its insured has been sued,
may not close its eyes to the underlying litigation, force the insured to face the risk of that litigation
without the benefit of knowing whether the insurer intends to defend or to deny coverage, and then
raise policy defenses for the first time after judgment has been entered against the insured.”), trans.
denied.

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If an insurer concludes that a claim is “patently outside the risks covered by the policy,” the
insurer may, of course, follow the path Conifer chose here and elect neither to defend nor to file for
declaratory judgment. T.B., 762 N.E.2d at 1231 (quotation omitted). But the insurer follows that
course at its peril, because the insurer will be bound to the matters “necessarily determined” in the
underlying lawsuit. Id. (quotation omitted).
Here, because Conifer neither defended its insureds nor filed a declaratory judgment action,
Conifer is bound to the matters necessarily determined in the state court suit. But to determine what
matters were “necessarily determined” in the underlying lawsuit here, a look at three major cases
is instructive.
In Frankenmuth Mut. Ins. Co. v. Williams, the insurer failed to defend its insured in the
underlying lawsuit, making the insurer bound to the matters “necessarily determined” in the
underlying lawsuit. 690 N.E.2d 675, 677 (Ind. 1997). The insurer wanted to raise a defense under
its policy’s “intentional acts” clause, but the court rejected this effort because the insured had not
been accused of any intentional act, and in the consent judgment the insured had admitted only to
negligence. So the insurer was estopped from “complaining that all of [the] damages flowed from
[an] intentional act.” Id. at 678. The consent judgment represented a “final legal conclusion” that
the insured committed negligence, that negligence was the legal cause of the tort plaintiff’s injuries,
and that damages came to $75,000. Id. at 678-79.
However, collateral estoppel did not prevent the insurer from raising a “business activity”
defense, because the underlying lawsuit had not necessarily determined that issue. The consent
judgment “in no way addressed” the issue of the insurer’s contractual obligations to the insured, so
the insurer was “obviously” not estopped from defending based on its policy’s “business activity”

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exclusion. Id. at 680. In short, the underlying lawsuit alleged negligence, and the insured admitted
to negligence, so after the consent judgment was entered the Frankenmuth insurer was estopped
from arguing that the insured had committed an intentional act. But the insured was not estopped
from arguing its “business activity” defense, because the consent judgment did not address that
issue.
In Liberty Mut. Ins. Co. v. Metzler, a trucker drove his truck into a bar, killing one and
injuring many. 586 N.E.2d 897 (Ind. Ct. App. 1992), trans denied. An injured couple sued the
trucker, alleging negligence. The trucker did not respond to the complaint, and the trial court entered
default judgment against him. The couple then sought to collect against the truck’s insurer in a
proceeding supplemental. The insurer argued that the trucker’s conduct was intentional, making it
excluded from coverage. And indeed, there was considerable evidence that the trucker’s conduct was
intentional, because the trucker had been criminally prosecuted, and on appeal from that prosecution
the Indiana Supreme Court held that he had acted intentionally. Nevertheless, in the proceeding
supplemental the Indiana Court of Appeals held that the insurer was collaterally estopped from
arguing that the conduct was intentional. Because the insurer had had notice of the underlying
negligence lawsuit and did not defend or act to protect its interest in the litigation’s outcome, the
insurer was collaterally estopped from arguing that the trucker’s intentional act barred coverage.
The insurer argued that it had the right not to defend or intervene once its own independent
investigation determined there was no coverage, and that it should be allowed to raise policy
defenses in the proceeding supplemental stage. The court agreed that the insurer had the “right” not
to defend against a claim “patently outside of the risks covered by the policy,” but the court held that
the exercise of such a right “will [not] operate to bar collateral estoppel. To the contrary . . . an

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insurer may refuse to defend its insured, but at its own peril.” 586 N.E.2d at 901. The insurer,
believing that it had no duty to defend, should have protected its interests by filing a declaratory
judgment action or by defending the insured under a reservation of rights. Having declined to follow
either course, the insurer “must now suffer the peril of its unilateral decision,” namely a collateral
estoppel bar against challenging whether the trucker acted negligently or intentionally. Id. at 902.
And because the trial court had determined that the trucker acted negligently, the issue was closed.
In short, as in Frankenmuth, in Metzler the underlying lawsuit alleged negligence, so after
judgment was entered the insurer was estopped from arguing that the insured had acted intentionally.
In State Farm Fire & Ins. Co. v. T.B., an insurer declined to defend its insureds against a
negligence lawsuit. 762 N.E.2d 1227 (Ind. 2002). The insureds then agreed to a consent judgment
of $375,000 against them, and the court accepted it. When the plaintiff sought to collect from the
insurer, the insurer argued that collateral estoppel did not bar it from raising a policy exclusion
defense and argued that it should not be bound by the factual statements in the consent judgment that
were not “necessary” to resolving the underlying lawsuit. 762 N.E.2d at 1230. The insurer conceded
that it was collaterally estopped from disputing that the insureds were negligent, but the insurer
sought to challenge certain factual statements in the consent judgment on the ground that those
findings were not necessary elements of the consent judgment. The insurer argued that the
underlying plaintiff had characterized events with the “obvious intent” of bringing the consent
judgment within the policy’s coverage. Id. at 1231.
The Indiana Supreme Court agreed that the characterizations were “unnecessary to sustain
[the] complaint for damages regarding negligence” and that their “sole purpose” was to fall within
coverage. Id. The court held that, if an insurer has notice of the factual determinations that will be

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made to resolve a lawsuit, the insurer’s failure to participate in the lawsuit “will bind it to those
determinations,” but an insurer cannot be estopped from contesting unnecessary matters resolved
in the underlying litigation. Id. at 1232. So because the underlying plaintiff’s claim did not
specifically address the insurer’s contractual obligations under the policy—even though the consent
judgment did—collateral estoppel did not bar the insurer from challenging certain statements in the
consent judgment.
In short, the underlying lawsuit alleged negligence, so after the consent judgment was
entered the T.B. insurer was estopped from challenging that finding, but the insurer was not estopped
from challenging factual statements in the consent judgment that were not necessary to the case’s
resolution. Rather, the insurer was only estopped from challenging findings that were necessary to
sustain the complaint.
Here, Kras’s state court complaint alleged that the attack on Kras occurred on the insureds’
“property and premises.” See ¶ 19. So Conifer had notice that the state court could make the factual
determination that the attack occurred on the insureds’ property and premises, and that that
determination would bind Conifer. If Conifer believed that the attack did not occur on the insureds’
property or premises, Conifer should have filed a declaratory judgment action and defended the
insureds under a reservation of rights. That Conifer did neither was not necessarily improper, but
the decision left Conifer at risk of facing a consent judgment that necessarily resolved the question
of whether the attack occurred on the insureds’ property.
However, it is not clear that the state court’s judgment here did necessarily resolve that the
attack occurred on the insureds’ property. Unlike in T.B., the state court here made no factual
findings whatsoever. True, the state court complaint alleges that the attack occurred on the insureds’

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“property and premises” (¶ 19). But the state court complaint also invites a verdict in Kras’s favor
even if the attack occurred on the portion of the nightclub’s parking area that Conifer says is not
owned by the insureds. First, the complaint alleges that the insureds’ “property and premises . . .
consists of a commercial type building and a parking area immediately adjacent to the commercial
building” (¶ 11). The complaint then distinguishes between the “paved and/or concrete” portion of
the parking area and the “gravel” portion of the parking area. (Id.) The complaint goes on to allege
that Kras was the insureds’ “business invitee” (¶ 22), that the insureds “knew or should have known”
that their business invitees “regularly park . . . in the gravel parking area” due to the “limited space”
on the paved or concrete parking area (¶ 12), that the business invitees’ use of the gravel parking
area was to the insureds’ “commercial and financial advantage,” and that Kras “reasonably believed”
that the insureds “controlled” the gravel parking area (¶ 17). So the complaint suggests that, even
if the attack occurred on the gravel portion of the parking area not owned by the insureds, the
insureds are still liable for Kras’s injury.
Because of this, the Court cannot find that the precise location of the attack was “necessarily
determined” by the state court judgment. Accordingly, Conifer is entitled to discovery on the issue
of where the attack occurred.
Kras points to the numerous findings of fact he proposed to the state court, including a
finding regarding where the attack occurred. But the state court judge explicitly refused to make
those findings, saying, “I’m not comfortable making the[se] findings . . . because I don’t know them
to be true. . . . I am prepared to enter a judgment . . . on the agreement . . . . in the amount specified,
without making any findings whatsoever . . . but I’ll leave for another day, another court . . . all of
the findings that you’re asking me to make, here.” (Apr. 14, 2016 Tr. at 5-6 (emphasis added).)

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Instead, the judge entered judgment “only for the [damages] amount that’s been stipulated to,”
without making “any other findings.” (Id. at 8.)
Kras argues that the state court judgment provided that the judgment was entered “[b]ased
upon the Plaintiff’s submission,” referring to the parties’ Agreement for Consent Judgment, but this
ignores the fact that the state court relied on that submission only for the “consented judgment
amount,” not for any other issues (emphasis added). Conifer cannot be bound by findings that the
state court itself did not trust to be true.
Kras also argues that discovery regarding the attack is unnecessary because Conifer already
investigated the attack before making its coverage decision, so Conifer must necessarily already
have the information it needs. True, Conifer had a duty to conduct a reasonable investigation into
the incident. Trisler v. Ind. Ins. Co., 575 N.E.2d 1021, 1023 (Ind. Ct. App. 1991) (allegations of
complaint and facts known to or ascertainable by insurer after reasonable investigation determine
insurer’s duty to defend). But Kras cites no case law in support of this argument, and the argument
ignores the possibility that evidence may exist beyond whatever evidence Conifer accumulated
during its initial investigation.
Finally, Kras argues that discovery regarding the attack would be irrelevant because the
attack’s location has been established as a matter of law by virtue of the insureds’ failure to respond
to Kras’s admissions requests, which asked the insureds to admit that Kras was attacked on the
insureds’ premises. Kras says that the insureds’ failure to answer means that the fact has been
admitted and therefore conclusively established, so there can be no dispute about the attack’s
location.
Kras is correct that failing to respond to requests for admission causes those matters to be

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admitted and conclusively established by law. Indiana Trial Rule 36; Henrichs v. Pivarnik, 588
N.E.2d 537, 543 (Ind. Ct. App. 1992). But while the failure to respond to the requests for admission
may have bound the insureds going forward, Kras has not cited—and the Court has not
found—authority supporting the proposition that the failure to respond binds Conifer or overrules
the collateral estoppel analysis described above. An insurer that abandons its insured as Conifer did
here will be bound to issues necessarily determined in the underlying litigation, and as the Court has
explained the question of the attack’s precise location was not necessarily determined.
In sum, Conifer is entitled to discovery regarding the location of the attack, because the issue
was not necessarily determined by the state court lawsuit.
B.

Discovery on the state court judgment’s reasonableness

Conifer also seeks discovery regarding whether the state court judgment was reasonable and
whether it was the result of bad faith or collusion. See Midwestern Indem. Co. v. Laikin, 119 F.
Supp. 2d 831, 842 (S.D. Ind. 2000) (Hamilton, J.) (collecting cases and concluding that Indiana
courts would hold that a consent judgment binds the insurer on issues of liability and damages, “so
long as the consent judgment . . . is not the product of bad faith or collusion and . . . falls somewhere
within a broad range of reasonable resolutions of the underlying dispute”) (emphasis added); accord
Carpenter v. Lovell’s Lounge & Grill, LLC, 59 N.E.3d 330 (Ind. Ct. App. 2016).
Kras argues that evaluating the judgment’s reasonableness is appropriate only where—unlike
here—the insurer defended on a reservation of rights or filed a declaratory judgment action. If
Conifer had defended under a reservation of rights or sought declaratory judgment, Kras says,
Conifer would indeed be entitled to a judicial determination regarding the state court judgment’s
reasonableness. But Conifer walked away, so Kras says the judgment’s reasonableness need not be

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evaluated.
The Court agrees with Conifer that judicial review of the state court judgment’s
reasonableness is appropriate. Requiring consent judgments between tort plaintiffs and insureds to
be reasonable and non-collusive protects insurers—even insurers who breach their duty to defend
their insureds, as Kras says Conifer has done—from “outrageous efforts to overreach” by underlying
tort plaintiffs, “while still encouraging and allowing settlement of disputes between the abandoned
insured and the injured plaintiffs.” Laikin, 119 F. Supp. 2d at 842-43 (“Indiana courts would be
willing to relieve a breaching insurer from the terms of a consent judgment that simply could not be
deemed a reasonable resolution of the underlying lawsuit”); Carpenter, 59 N.E.3d at 340
(“substantial injustice” would result if insurer who breached duty to defend is bound to a consent
judgment “even if [the] consent judgment is procured by bad faith or collusion”).
Kras also argues that, even if evaluating the state court judgment’s reasonableness is
appropriate, the judgment’s reasonableness here has been conclusively established. Kras says the
insureds’ failure to respond to Kras’s admissions requests—which specifically explained the formula
for calculating Kras’s desired damages award—constituted admissions of those facts. For example,
Admission Request No. 21 asked the insureds to admit or deny that “the reasonable amount of the
future physical, mental, and emotional pain, suffering, and distress experienced [by Kras] is
$1,350,500.00 (37 year life expectancy, 37 years x 365 days per year = 13,404 days x $100.00 per
day = $1,350,500).” The admissions requests also provided similar calculations for Kras’s other
claimed damages. So, Kras says, the damages amount has been conclusively established, and there
is no need for discovery regarding the judgment’s reasonableness.
But as explained above, evaluating the reasonableness of an underlying judgment is

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appropriate even when an insurer abandoned its insured. And it would be senseless to evaluate such
a judgment’s reasonableness only where the insured responded to the tort plaintiff’s admissions
requests and not to evaluate the judgment’s reasonableness where the insured ignored the admissions
requests. Doing so would cause an insurer’s fate to hinge arbitrarily on the insured’s decision to
respond or not and would fail to guard against “outrageous efforts to overreach” by underlying tort
plaintiffs. See Laikin, 119 F. Supp. 2d at 842; Carpenter, 59 N.E.3d at 340 (“Appellants’ position
would actually encourage insureds to engage in collusion if it was clear that no coverage was
available and the insurer had not done anything to protect its interests.”).
Kras also argues that, even if the Court decides to evaluate the state court judgment’s
reasonableness, the judgment was reasonable as a matter of law from the insureds’ standpoint under
Indiana’s reasonableness standard—and no discovery, Kras says, is needed to reach that conclusion.
Kras is correct that the standard of reasonableness for a consent judgment between a tort
plaintiff and an abandoned insured is a “generous one” that allows “for a very broad range of
reasonable resolutions.” Laikin, 119 F. Supp. 2d at 843. The standard takes into account uncertainty
regarding issues of fact and law, the parties’ varying degrees of risk aversion, the burden of litigation
on the abandoned insured, and the wide ranges of damages awards that can be proper where an
injury is not subject to precise quantification. Id. So an insurer’s challenge to a consent judgment’s
reasonableness is not “an opportunity to relitigate issues based merely on 20/20 hindsight” or based
on an insurer’s belief that it could have negotiated a better deal. Id. Even if the insured’s evaluation
of the litigation risk is arguably mistaken, a reasonable settlement will stand. Id. at 844. A court
should view the consent judgment from the perspective of the insured at the time of the agreement,
“keeping in sharp focus the premise that the insured breached its contract and left the insured

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hanging, exposed to the serious risk of devastating personal liability.” Id.
Likewise, Kras is correct that the issue should be decided as a matter of law—unless there
are “clear grounds for finding the settlement fell outside any reasonable bounds”—because a trial
on the settlement’s reasonableness “would effectively amount to a complex trial within a trial.” Id.
At the trial’s core would be evidence on the underlying tort claims—evidence regarding liability,
injury, and damages—in other words the very trial the insured and the tort plaintiff sought to avoid.
And layered on top of that would be evidence about the underlying litigation itself and the course
of settlement negotiations, inviting “opinions from lawyers, claims adjusters, and perhaps mediators
and judges, expressing their views on the reasonableness of the settlement terms.” Id. at 845. So an
insurer must clear a “high bar” before the Court will impose such a trial on parties “who thought
they had settled their dispute.” Id.
But Kras’s argument that there are no clear grounds for finding that the judgment amount
was unreasonable is premature. Kras argues that the Court “could readily conclude” that the
judgment amount was reasonable based on the evidence that the insureds were negligent,
information regarding Kras’s injuries and medical expenses, case law regarding juries’ “wide
latitude in making damages determinations” for physical pain and suffering, and the insureds’
reasons for deciding to agree to the consent judgment. But the time to assess the judgment’s
reasonableness is at the summary judgment stage. The question now is whether Conifer is entitled
to discovery regarding the judgment’s reasonableness. And the answer is that Conifer is entitled to
at least some discovery regarding whether the judgment was reasonable or was the result of bad faith
or collusion.
Conifer describes its questions as follows: “How was the Judgment calculated? What were

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Plaintiff’s medical costs? What information was provided to the underlying defendants/judgment
debtors before the consent judgment was submitted to the state trial court?” Answering these
questions will not likely be burdensome for Kras; indeed, Kras has answered many of these
questions already in his response to the instant Motion. Plainly, Conifer is not entitled to re-litigate
the state court case. Laikin, 119 F. Supp. 2d at 842 (“Such a rule would encourage denial of
coverage and multiply litigation.”). But Conifer is entitled, at a minimum, to submit formal
interrogatories regarding the judgment’s reasonableness. Whether the answers will allow Conifer
to clear the “high bar” that it must clear before bringing the issue in front of a fact-finder remains
to be seen. See Carpenter, 59 N.E.3d at 340 (insurer that abandoned its insured “has the burden to
prove by clear and convincing evidence that the Consent Judgment was procured by bad faith or
collusion”).
In sum, Conifer is entitled to at least some limited discovery regarding whether the consent
judgment was reasonable or was the result of bad faith or collusion.
III.

Kras’s request to rule on whether the policy language is ambiguous
Kras argues that, if the Court does allow Conifer to conduct discovery, the Court can help

avoid unnecessarily protracted discovery by ruling now on whether Conifer’s policy language is
ambiguous.
The basis for Conifer’s denial of coverage is that the policy limits coverage only to the
insureds’ physical property boundaries, and Conifer says the attack occurred on the gravel area
outside that boundary. But if the relevant policy language is ambiguous, Kras says, then the insureds
had coverage even if the attack did occur where Conifer says it occurred. West Bend Mut. v. Keaton,
755 N.E.2d 652, 654 (Ind. Ct. App. 2001) (policy limitations must be expressed clearly), trans.

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denied; Am. Nat’l Fire Ins. Co. v. Rose Acre Farms, 107 F.3d 451, 457 (7th Cir. 1997) (clause
excluding coverage must “clearly and unmistakably” bring excluded condition within its scope)
(citation omitted). Deciding now whether the policy language is ambiguous, Kras says, would
obviate the need to wade into a discovery quagmire. Westfield Cos. v. Knapp, 804 N.E.2d 1270,
1273-74 (Ind. Ct. App. 2004) (“[t]he interpretation of a contract is a matter of law”), trans. denied.
But the limited discovery inquiries described above do not threaten to prolong this lawsuit
enough to warrant ruling on the policy language before summary judgment. Discovery is limited in
cases like this to protect a tort plaintiff from having to litigate a lawsuit against an abandoned
insured that the plaintiff thought he had settled. Plus, even if the Court were to find the policy
language ambiguous, the question of whether the judgment was reasonable or was the product of
bad faith or collusion would remain. So the more expedient course is to wait to rule on this issue
until the parties have fully briefed their summary judgment motion(s). Myles v. General Agents Ins.
Co. of Am., 197 F.3d 866, 868 (7th Cir. 1999) (“Indiana courts have recognized that construction
of an insurance policy is a question of law for which summary judgment is particularly
appropriate.”) (internal quotation omitted).
IV.

Conclusion
For the reasons above, the Court GRANTS Conifer’s Motion for Extension of Time to

Respond to Plaintiff’s Motion for Summary Judgment [DE 20] and ORDERS that Conifer’s
deadline for responding to Kras’s Motion for Summary Judgment [DE 17] is STAYED until 30 days
after the close of discovery or the resolution of any discovery disputes, whichever comes later.
SO ORDERED this 23rd day of November, 2016.
s/ John E. Martin
MAGISTRATE JUDGE JOHN E. MARTIN
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UNITED STATES DISTRICT COURT
cc:

All counsel of record

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