Great American Alliance Insurance Company v. Stutes et al
ORDER entered by Judge Nanette Laughrey granting Richards' Motion to Dismiss, [Doc. 47]. Signed on 4/13/18 by District Judge Nanette K. Laughrey. (Matthes Mitra, Renea)
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF MISSOURI
GREAT AMERICAN ALLIANCE
DEVIN STUTES, AMANDA STUTES,
JEREMY RICHARDS AND
Defendants Jeremy Richards and Karlee Richards moved to dismiss or stay this
declaratory judgment action by Plaintiff Great American Alliance Insurance Company in light of
a garnishment proceeding that the Richards brought in state court against Great American. For
the reasons set forth below, the Court GRANTS the motion to dismiss.
In June 2014, at the age of sixteen, Ms. Richards, along with her Searcy Baptist Church
youth group, attended a summer camp sponsored by Student Life, a division of Lifeway
Christian Resources of the Southern Baptist Convention, at Windermere Baptist Conference
Center in Missouri. While there, Ms. Richards was injured when she fell from a zip-lining
course. To date, Ms. Richards has undergone more than 25 surgeries and incurred medical
expenses exceeding $1.8 million as the result of that fall.
The Richards subsequently sued, inter alia, Devin Stutes, Searcy’s youth leader at the
time of the camp and head chaperone for the trip to Windermere, and Amanda Stutes, another
chaperone for the trip to Windermere. The suit was filed in the Circuit Court of Morgan County.
On November 18, 2016, the Stutes tendered a claim to Great American seeking defense and
indemnity for the claims against them, asserting that they were additional insureds under a policy
that Great American issued to Lifeway. On December 7, 2016, Great American denied the
On February 28, 2017, Great American filed this action, seeking a declaration “that no
liability coverage exists under the Great American policy issued to Lifeway for any of the claims
asserted against Defendants Devin Stutes and Amanda Stutes in the Underlying Lawsuit, that
Great American owes neither a duty to defend them nor a duty to indemnify them from the
claims and allegations asserted in the Underlying Lawsuit, for its costs . . . .” Doc. 1.
On May 10, 2017, the Stutes were dismissed from the Morgan County action. However,
that same month, the Richards filed a new lawsuit in Jasper County against the Stutes and others.
A judgment was entered in the Richards’ Jasper County action against tortfeasors
Windermere Baptist Conference Center, Inc. and Amanda Stutes and Devin Stutes on October
24, 2017. The Richards then filed a garnishment application on January 5, 2018 naming Great
American as garnishee and seeking to garnish proceeds, payments, and obligations under four
specified policies. Doc. 48-3. The application was filed pursuant to Chapter 525 of the Revised
Statutes of Missouri. Doc. 64-1, at 2.
On January 12, 2018, the Richards moved to stay or dismiss this action in light of the
garnishment proceeding in state court, and Great American filed a motion for summary
judgment. On February 2, 2018, Great American removed the garnishment proceeding to federal
court, on the basis of diversity. See Richards v. Great American Alliance Insurance Company,
No. 18-5011-SRB. In papers in opposition to the Richards’ motion to dismiss this case, Great
American argued that, because there no longer was a state court action, there was no basis for the
Court to abstain. Doc. 64. In reply, the Richards asked the Court to stay consideration of their
motion to dismiss until after the Richards moved to remand the garnishment proceeding to state
court. Doc. 70.
On March 2, 2018, the Richards voluntarily moved for dismissal without prejudice of the
Richards, No. No. 18-5011-SRB, Doc. 10.
proceeding was dismissed on March 27, 2018. Id., Doc. 17.
On April 6, 2018, the Richards filed a new garnishment proceeding, this time, pursuant to
Missouri Revised Statutes Section §379.200.
District courts possess “unique and substantial discretion” in determining whether to hear
cases brought pursuant to the Declaratory Judgment Act, “even when the suit otherwise satisfies
subject matter jurisdictional prerequisites.” Wilton v. Seven Falls Co., 515 U.S. 277, 282, 286
(1995); see also Royal Indem. Co. v. Apex Oil Co., 511 F.3d 788, 793 (8th Cir. 2008) (“[I]n a
declaratory judgment action, a federal court has broad discretion to abstain from exercising
jurisdiction . . . .”). In such cases, “the normal principle that federal courts should adjudicate
claims within their jurisdiction yields to considerations of practicality and wise judicial
administration.” Wilton, 515 U.S. at 288.
When determining whether to abstain from exercising jurisdiction because of a parallel
state court proceeding, the Court must consider “the scope and nature of the pending state court
proceeding,” and determine whether the issues “can be better settled by the state court.” Capitol
Indemnity Corp. v. Haverfield, 218 F.3d 872, 874 (8th Cir. 2000). “If so, the district court must
dismiss the federal action because ‘it would be uneconomical as well as vexatious for a federal
court to proceed in a declaratory judgment suit where another suit is pending in a state court
presenting the same issues, not governed by federal law, between the same parties.’” Id. at 87475 (quoting Brillhart v. Excess Ins. Co., 316 U.S. 491, 495 (1942)).
The threshold question in determining whether to dismiss this suit is “whether there are
parallel proceedings in state court that present an opportunity for the same issues to be
addressed.” Atain Specialty Ins. Co. v. Frank, No. 12-CV-01290-NKL, 2013 WL 12145863, at
*3 (W.D. Mo. Mar. 25, 2013). “Suits are parallel if substantially the same parties litigate
substantially the same issues in different forums.” Scottsdale Ins. Co. v. Detco Indus., Inc., 426
F.3d 994, 997 (8th Cir. 2005). Factors relevant to whether proceedings are parallel include “the
scope of the pending state court proceeding and the nature of defenses open there.” Wilton, 515
U.S. at 282–83 (quotation omitted). Evaluating these factors “entails consideration of whether
the claims of all parties in interest can satisfactorily be adjudicated in that proceeding, whether
necessary parties have been joined, whether such parties are amenable to process in that
proceeding, etc.” Id. at 283.
The parties before the Court now are all parties to the state court proceeding.1 Great
American argues that the issues before the Court are different from those pending in state court.
Great American cites the facts that (1) this action seeks a declaration regarding coverage for the
Stutes in the Morgan County lawsuit, and (2) the currently pending Jasper County state court
action was never tendered to Great American. However, the Stutes were dismissed from the
Morgan County lawsuit. To the extent that Great American insists that this action concerns
coverage for the Stutes in an action from which they were dismissed, the request for declaratory
judgment is moot for lack of a case or controversy. To the extent that any case or controversy
Great American points out that not all of the parties to the state court proceeding are parties
here, but that is of no matter. The relevant question is whether there are parties to this action
who are not amenable to process in state court, and there are none.
remains between Great American and the Richards as to coverage for the Stutes, the dispute
concerns matters at issue in the Jasper County state court action.
Furthermore, interpretation of the insurance contract as to which Great American seeks a
declaration is governed by state law, which the state court is better poised to apply. Finally,
while this declaratory judgment actions concerns one Great American policy, the state court
proceeding concerns not only the policy at issue here, but also three additional Great American
policies. The state court thus is in the unique position of being able to afford complete relief to
the parties to this action. For these reasons, abstention is warranted.
The Court is not swayed by Great American’s argument that the fact that this action was
filed before the state court garnishment action should preclude abstention. The Eighth Circuit
has found abstention to be “required even when the declaratory judgment action was filed
months before the state-court action.” W. Heritage Ins., Co. v. Sunset Sec., Inc., 63 F. App’x
965, 967 (8th Cir. 2003); see also Haverfield, 218 F.3d at 872 (holding, despite the fact that the
insurer’s federal declaratory judgment action was filed six months before the state court action,
that “the state court was in a better position to adjudicate the matter” and the district court
therefore should have abstained). Moreover, Great American’s ability to file a declaratory
judgment action long before a garnishment action could be filed should not be a decisive factor
in determining the appropriate forum for the case.
The Court also is not persuaded by Great American’s argument that its efforts in this case
will have been for naught if this action is dismissed. The parties will be able to raise in state
court the very same motions and issues they have raised here.
Because the Court foresees “no reason for the case to return to federal court,” the Court
finds dismissal, rather than a stay, appropriate. See Haverfield, 218 F.3d at 875 n. 2 (8th Cir.
For the reasons discussed above, the Richards’ motion to dismiss is granted.
s/ Nanette K. Laughrey
NANETTE K. LAUGHREY
United States District Judge
Dated: April 13, 2018
Jefferson City, Missouri
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