Axis Insurance Company v. Turner Industries Group, LLC et al

Filing 79

ORDER AND REASONS - IT IS ORDERED that the motions to dismiss 36 , 43 , 44 , 45 , 47 are GRANTED and Axis's complaint is DISMISSED WITHOUT PREJUDICE. Signed by Judge Susie Morgan on 7/30/2014. (bwn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
AXIS INSURANCE COMPANY,
Plaintiff

CIVIL ACTION

VERSUS

NO. 14-146

TURNER INDUSTRIES
GROUP, et al.,
Defendants

SECTION "E"

ORDER & REASONS
The Court has pending before it Defendant Turner Industries Group's ("Turner")
motion to dismiss1 this declaratory judgment action filed by Plaintiff Axis Insurance
Company ("Axis).

Four "me-too" motions to dismiss were filed by various other

defendants in this declaratory judgment action joining in Turner's motion.2 The Court
has reviewed the oppositions3 and supplemental briefing,4 the record, and the law, and
now issues this order and reasons granting all five motions to dismiss.
BACKGROUND
This case arises out of shootings on August 16, 2012, which resulted in the deaths
of two St. John the Baptist Parish Sheriff's deputies and injuries to two more.
Defendant5 Turner Industries Group contracted with Defendant Diamond Green Diesel,
LLC to build a biodiesel plant. Defendant Gemini Insurance Company was the primary
insurer on the project. Plaintiff Axis Insurance Company is the excess insurer.
Defendant Valero Energy Corporation hired Deputy Scott Boyington to provide

R. Doc. 36.
R. Docs. 43 (filed by M. Scott Boyington and Wendy Boyington), 44 (filed by Misty McTopy
Triche), 45 (filed by Daniell L. Nielsen), and 47 (filed by Jason Triche and Melissa Triche).
3
R. Docs. 53, 56.
4
R. Docs. 64, 77, 78.
5
Unless otherwise noted, the Court uses "Defendant" to refer to the defendants in this declaratory
judgment action.
1

2

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private security at an off-site parking lot used by Turner employees working on the
biodiesel plant project. On August 16, 2012, Boyington confronted a vehicle occupied by
Terry Smith, Brian Smith, and Kyle David Joekel.

One or more of the vehicle's

occupants shot Boyington multiple times and fled.
Deputies Jason Triche, Jeremy Triche, and Brandon Nielsen then went to the
residence of Terry Smith, Brian Smith, and Joekel. They were ambushed. Jeremy
Triche and Brandon Nielsen were fatally shot, and Jason Triche was wounded.
Four lawsuits arising out of these events were filed against the alleged killers, as
well as against Valero, Diamond Green Diesel, Turner, Gemini, Axis, and ACE American
Insurance Company, in the 40th Judicial District Court for the Parish of St. John the
Baptist. The four petitions, which are substantially similar in their factual allegations,
were brought by (1) Scott Boyington and his family,6 (2) Misty McTopy Triche, the
widow of Jeremy Triche,7 (3) Daniell Legnon Nielsen, the widow of Brandon Nielsen8,
and (4) Jason Triche and his family.9
Axis, a named defendant in all four state-court lawsuits, filed this declaratory
judgment action.

In its pleadings as amended, Axis seeks various declaratory

interpretations of its insurance policy with respect to the claims asserted in the four
state-court cases, including (1) whether there is coverage, (2) whether various parties
are insureds under the policy, (3) whether the underlying events constitute one or more
occurrences under the policy, and (4) whether the Axis policy is in excess to a policy
issued by Defendant ACE American Insurance Company.10

6
7
8
9
10

R. Doc. 75-1.
R. Doc. 75-2.
R. Doc. 75-3.
R. Doc. 75-4.
R. Doc. 75.

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Defendant Gemini filed its own declaratory action in a different section of this
Court, seeking a declaratory judgment regarding the number of occurrences for the
purposes of its policy. See Gemini Ins. Co. v. Turner Ind. Grp., LLC, et al., No. 1305922 (filed E.D. La. Sept. 24, 2013) (R. Doc. 1). A motion to dismiss on abstention
grounds was recently granted in that case. See Gemini Ins. Co. v. Turner Ind. Grp.,
LLC, No. 13-05922, 2014 WL 3530475 (E.D. La. July 16, 2014).
Most Defendants in this case now move to dismiss, urging the Court to exercise
its discretion and abstain from entertaining this declaratory judgment. Axis opposes the
motion, and Gemini (as a defendant in this action) opposes the motion to dismiss
because Gemini wishes the Court to decide the number of occurrences issue.
ANALYSIS
This is a declaratory judgment action. "Under the Declaratory Judgment Act, a
district court has a measure of discretion in deciding whether to entertain the action."
St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590 (5th Cir. 1994). This discretion is broad but
not unfettered. See id. In deciding whether to abstain, the Court considers three areas
of concern: (1) federalism, comity, and "the proper allocation of decision-making
between state and federal courts," (2) "fairness," or the distinction between "legitimate
and improper reasons for forum selection," and (3) "efficiency," or avoidance "of
duplicative or piecemeal litigation." See Sherwin-Williams Co. v. Holmes Cnty., 343
F.3d 383, 389-91 (5th Cir. 2003). The Fifth Circuit's seven Trejo factors fall under those
three umbrella categories. See id. at 391-92.11 The Court has considered the parties'

11
The Trejo factors are: "1) whether there is a pending state action in which all of the matters in
controversy may be fully litigated, 2) whether the plaintiff filed suit in anticipation of a lawsuit filed by the
defendant, 3) whether the plaintiff engaged in forum shopping in bringing the suit, 4) whether possible
inequities in allowing the declaratory plaintiff to gain precedence in time or to change forums exist, 5)
whether the federal court is a convenient forum for the parties and witnesses, . . . 6) whether retaining the

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arguments with respect to these three areas and seven factors.
First, the federalism factors strongly weigh in favor of abstention.

Axis's

pleadings implicate purely state-law issues of insurance contract interpretation. And as
the Fifth Circuit has advised, "if the federal declaratory judgment action raises only
issues of state law and a state case involving the same state law issues is pending,
generally the state court should decide the case and the federal court should exercise its
discretion to dismiss the federal suit." Sherwin-Williams, 343 F.3d at 390-91. Here,
the purely state-law insurance issues will be decided in the four pending state-law cases.
Although Axis complains strenuously that there is no single pending case which will
resolve every claim against it by every Plaintiff,12 what matters is the existence of "a
pending state action in which all the matters in controversy may be litigated." See
Sherwin-Williams, 343 F.3d at 391 (emphasis added). Plainly, all state-law issues will
be litigated in the pending state cases; the fact that it will be litigated in more than one
case is immaterial to "the proper allocation of decision-making between state and
federal courts." See id. at 390. Thus, federalism strongly favors allowing the state
courts to resolve these issues in the pending state-court actions.
Second, the fairness factors do not weigh strongly for or against exercise of
jurisdiction over this declaratory judgment action.

Axis's resort to this forum in

response to being named in four separate state-court suits is not obviously egregious or
inequitable, and the Court can discern no improper "forum shopping." Axis would
prefer to litigate its issues in this single federal forum; Defendants would prefer to
litigate the claims in their state-court cases. The applicable rules and laws allow both;
lawsuit in federal court would serve the purposes of judicial economy" and 7) "whether the federal court is
being called on to construe a state judicial decree involving the same parties and entered by the court
before whom the parallel state suit between the same parties is pending." Trejo, 39 F.3d at 590-91.
12
R. Doc. 53 at 7.

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no party appears to be gaming the system.
Third, the efficiency factors do not favor exercising jurisdiction, and certainly not
with enough weight to counterbalance the strong federalism interest in abstaining.
With respect to convenience, the federal and state courts are equally convenient with
respect to evidence and geography.

With respect to judicial economy, exercising

jurisdiction could streamline some matters but would multiply others. Certainly, if this
Court exercised jurisdiction there would be one definitive resolution of the insurance
policy issues Axis raises. But practically speaking, the state court actions are just as
likely to produce one definitive resolution. As Turner points out, three of the state-court
cases are pending before the same judge, and the fourth (pending in the same court)
could be consolidated.13 See La. Code Civ. P. 1561. Thus, the efficiency advantage of
adding this federal dimension to the state-court litigation is far more negligible than
Axis contends. Moreover, adding a federal case will require the state-court Plaintiffs
(Defendants here) to litigate on two fronts and will require this Court and the state court
to duplicate their efforts. For example, both Axis's insurance coverage and number-ofoccurrence arguments and the state-court Plaintiff's claims against Turner require
factual findings regarding the events of August 16, 2014.

In short, Axis has not

persuaded the Court that this declaratory judgment action would produce any
significant net benefit of judicial economy.14
The decision to abstain from exercising jurisdiction over a declaratory judgment
action is discretionary and not subject to mechanical application. Although the parties

R. Doc. 64 at 6; R. Doc. 75-1 at 19 (40th JDC, Division B); R. Doc. 75-2 at 17 (40th JDC, Division
B); R. Doc. 75-3 at 1 (40th JDC , Division A); R. Doc. 75-4 at 17 (40th JDC, Division B).
14
As a practical matter, exercising jurisdiction over this declaratory judgment action makes even
less sense from an efficiency standard in light of the well-reasoned opinion granting the motion to dismiss
Gemini's declaratory judgment action. See 2014 WL 3530475 at *3-5.
13

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analogize or distinguish various cases, the Court must decide on these particular facts.
In this case, there is no federal interest in resolving purely state-law questions of
insurance contract interpretation; thus, federalism strongly weighs in favor of
abstaining.

See Sherwin-Williams, 343 F.3d at 390-91.

Moreover, the Court is

convinced that the 40th JDC will resolve these issues efficiently and with minimal risk
of inconsistent judgments; thus, at most the efficiency concerns do not warrant
exercising jurisdiction. Therefore, after considering the relevant factors articulated by
the Fifth Circuit, the Court will exercise its discretion, abstain from hearing this
declaratory judgment action, and grant the motions to dismiss.
CONCLUSION
For the foregoing reasons,
IT IS ORDERED that the motions to dismiss15 are GRANTED and Axis's
complaint is DISMISSED WITHOUT PREJUDICE.16
New Orleans, Louisiana, this 30th day of July, 2014.
___________________________
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE

R. Docs. 36, 43, 44, 45, 47.
For the same reasons, the Court sua sponte declines to exercise jurisdiction over pro se Defendant
Brian L. Smith's counter-claim against Axis seeking declaratory judgment that Smith's actions in "fir[ing]
bullets at Boyington" were "in defense of persons or property." R. Doc. 16 at 4-5. The counter-claim is
DISMISSED WITHOUT PREJUDICE.
15

16

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