Auto-Owners (Mutual) Insurance Company v. Pearson et al

Filing 23

ORDER & JUDGMENT granting Auto-Owners' motion 21 for default jdgmt, JUDGMENT ENTERED in favor of Auto-Owners & against all defts as set forth in following paragraphs... (see Paras 3a-e for specifics), & directing Clrk of Ct to CLOSE case. (See order & jdgmt for complete details.) Signed by Chief Judge Christopher C. Conner on 10/10/17. (ki)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
AUTO-OWNERS (MUTUAL)
INSURANCE COMPANY,
Plaintiff
v.
JAMES PEARSON, JR., PEARSON
EXPEDITING SERVICES, LLC, and
BECKY L. WILT,
Defendants

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CIVIL ACTION NO. 1:16-CV-2331
(Chief Judge Conner)

ORDER & JUDGMENT
AND NOW, this 10th day of October, 2017, upon consideration of the motion
(Doc. 21) by plaintiff Auto-Owners (Mutual) Insurance Company (“Auto-Owners”)
requesting default judgment against defendants James Pearson, Jr. (“Pearson”)
and Pearson Expediting Services, LLC, (together, the “Pearson defendants”) and
Becky L. Wilt (“Wilt”), and the court noting that Auto-Owners initiated the abovecaptioned action by filing a complaint (Doc. 1) for declaratory judgment and breach
of contract on November 18, 2016, wherein Auto-Owners avers that it issued an
automobile insurance policy to the Pearson defendants which identified Pearson
alone as the insured driver; that a vehicle insured under said policy was involved in
a motor vehicle accident on May 6, 2015; and that, although the vehicle in question
was operated by Wilt at the time of the accident, the Pearson defendants falsely and
deliberately misrepresented to Auto-Owners on two occasions that Pearson had
been operating the vehicle, (see Doc. 1 ¶¶ 14, 16, 25-33), in addition to other false
and material misrepresentations, and wherein Auto-Owners thus asks the court

to declare that it has no duty to defend or indemnify the Pearson defendants under
the policy’s fraud exclusion, and further determine that the Pearson defendants
have breached the policy by engaging in fraudulent behavior, (see id. ¶¶ 42-61), and
the court further noting that Auto-Owners served the summons and complaint on
the Pearson defendants by process server on March 18, 2017, (Doc. 14), and, with
the court’s leave, (Doc. 16), effected service upon defendant Wilt by publication in
accordance with Federal Rule of Civil Procedure 4(e)(1) and Pennsylvania Rule of
Civil Procedure 430 on May 26, 2017, (Doc. 17), and that all defendants failed to
plead or otherwise defend, see FED. R. CIV. P. 12, resulting in the Clerk’s entry of
default (Doc. 20) against all defendants on July 31, 2017, see FED. R. CIV. P. 55(a);
and, turning to Auto-Owners’ instant motion for default judgment, which remains
unopposed by any defendant, the court observing that entry of default judgment is
appropriate when unchallenged facts of the complaint state a prima facie cause of
action, see Joe Hand Promotions, Inc. v. Yakubets, 3 F. Supp. 3d 261, 270 (E.D. Pa.
2014) (citing Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990)), and
finding that the undisputed allegata establish that the Pearson defendants’ false
statements actuate the fraud exclusion of the insurance policy, such that AutoOwners has no obligation to provide coverage to, defend, or indemnify defendants
for any claims that have arisen or may arise from the May 6, 2015 motor vehicle
accident, and the court accordingly concluding that entry of default judgment is
appropriate, and that, given the nature of this declaratory judgment action and
Auto-Owners’ requested relief, no further inquiry into the appropriate remedy is

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required, see FED. R. CIV. P. 55(b)(2); Rhino Assocs. L.P. v. Berg Mfg. & Sales Corp.,
531 F. Supp. 2d 652, 657 (M.D. Pa. 2007), it is hereby ORDERED that:
1.

Auto-Owners’ motion (Doc. 21) for default judgment is GRANTED.

2.

Judgment is ENTERED in favor of Auto-Owners and against all
defendants as set forth in the following paragraphs.

3.

It is ADJUDGED and DECREED that:
a.

Auto-Owners has no obligation to provide coverage for the
defendants under the terms, conditions and insuring
agreements of Policy # 48-647-085-00 in connection with the suit
brought by Leo and Nancy Tysak in the Court of Common Pleas
of Franklin County, No. 2015-3544, or any related suits, notices
of claims or potential claims reported or which could be
reported in the future;

b.

Auto-Owners has no obligation to indemnify the defendants in
connection with the suit brought by Leo and Nancy Tysak in the
Court of Common Pleas of Franklin County, No. 2015-3544;

c.

As Auto-Owners has no obligation to indemnify the defendants
in connection with the suit brought by Leo and Nancy Tysak in
the Court of Common Pleas of Franklin County, No. 2015-3544,
Auto-Owners has no further obligation to continue to defend the
defendants in connection with the suit;

d.

Auto-Owners has no obligation to advance and/or reimburse the
defendants for any fees or costs incurred in connection with the
defense of the suit brought by Leo and Nancy Tysak in the
Court of Common Pleas of Franklin County, No. 2015-3544, or
any related claims, notices of claims or potential claims reported
or which could be reported in the future; and

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e.

4.

Auto-Owners has no obligation to indemnify, pay any
judgment or settlement which may be rendered, or make
any reimbursement to the defendants for any amounts in
connection with the suit brought by Leo and Nancy Tysak in the
Court of Common Pleas of Franklin County, No. 2015-3 544, or
any related claims, notices of claims or potential claims reported
in the future.

The Clerk of Court is directed to CLOSE this case.

/S/ CHRISTOPHER C. CONNER
Christopher C. Conner, Chief Judge
United States District Court
Middle District of Pennsylvania