World Fuel Services Corporation et al v. Alterra Excess & Surplus Insurance Company

Filing 40

ORDER by Magistrate Judge Charles S. Miller, Jr. granting 32 Motion to Stay Discovery. (BG)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NORTH DAKOTA
NORTHWESTERN DIVISION
World Fuel Services Corporation; World
Fuel Services, Inc.; World Fuel Services
Canada, Inc.; Western Petroleum Company;
Dakota Petroleum Transport Solutions,
LLC; Petroleum Transport Solutions, LLC;
DPTS Marketing, LLC; Dakota Plains
Marketing, LLC; and Dakota Plains
Transloading, LLC;
Plaintiffs,
vs.
Alterra Excess & Surplus Insurance
Company n/k/a Markel Corporation,
Defendant.

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ORDER GRANTING MOTION
TO STAY DISCOVERY AND
SETTING STATUS CONFERENCE

Case No.: 4:14-cv-054

Plaintiffs have been sued in a number of actions arising out of the tragic derailment of a train
operated by the Montreal, Maine and Atlantic Railway that occurred in Lac-Mégantic, Quebec. The
derailment resulted in the deaths of more than 40 persons and caused substantial property and
environmental damage. The actions in which plaintiffs have been named include: (1) a class action
in Quebec alleging various bodily injury and property damages claims; (2) a number of wrongful
death claims filed in Illinois, removed to the federal district court, and transferred to the federal
district court in Maine; (3) the railroad’s bankruptcy proceedings in the District of Maine and
Canada; and (4) a Canadian administrative environmental proceeding.
Plaintiffs filed their complaint in this action on May 23, 2014, seeking a declaration of
coverage under an excess liability policy issued by defendant. Although the complaint was filed in
2014, service was delayed with the consent of defendant for a period of time. When the parties
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could not agree to further extensions for service of the complaint, the complaint was served and
defendant filed its answer and counterclaim on January 13, 2015.

Defendant seeks in its

counterclaim a declaration that it owes no obligation to indemnify plaintiffs and asserts a number
of defenses to coverage.
Plaintiffs now seek a stay of all discovery for a period of 120 days to see if global settlement
discussions led by representatives of the railroad’s bankruptcy estates will bear fruit. Plaintiffs
claim that a global resolution may provide greater clarity with respect to any underlying liabilities
of plaintiffs and potentially narrow the issues to be resolved in this case, which, in turn, could lessen
the amount of discovery required.
Defendant opposes the motion. In the alternative, it offers to defer discovery with respect
to its “expected or intended” defense, which the court expressed concern about during an informal
discovery conference as possibly undercutting plaintiffs’ defenses in the underlying litigation, i.e.,
giving aid and comfort to its insured’s “enemies.”
After careful review, the court concludes that plaintiffs have shown good cause for deferring
discovery and defendant has failed to demonstrate that it will be prejudiced, much less unfairly. The
court also concludes that deferring discovery only on the “expected or intended” defense is not an
answer because the substantial amount of discovery that would proceed defeats the purpose for
deferring discovery in the first instance.
Consequently, plaintiffs’ motion (Doc. No. 32) is GRANTED and all discovery will be
stayed pending further order of the court. The court will hold a telephonic status conference on June
26, 2015 at 10:00 a.m. CDT to discuss: (1) the status of the underlying litigation; (2) whether the
stay of discovery should be lifted or continued; (3) the setting of new pretrial deadlines and a new

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trial date, if necessary; and (4) whether an early ADR effort would be beneficial.
IT IS SO ORDERED.
Dated this 22nd day of April, 2015.
/s/ Charles S. Miller, Jr.
Charles S. Miller, Jr., Magistrate Judge
United States District Court

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