Evanston Insurance Company v. Watts et al
Filing
108
ORDER denying 89 Motion to Certify Class. Signed by Honorable Joseph F. Anderson, Jr. on 04/15/2014.(bshr, )
IN THE UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
Evanston Insurance Company,
C/A No. 3:13-cv-00655-JFA
Plaintiff,
vs.
Vickie Watts, as personal representative of
the Estate of Dorothy Jones; Meredith
Wofford; Estate of Dora Elizabeth B.
Hanna, by and through her personal
representative, King C. Hanna, Jr., and on
behalf of a class of individuals similarly
situated; LaFay Walker, as personal
representative of the Estate of Martha
Sellers Blackwelder; Amanda Curtis;
Preston Wayne Chandler, as personal
representative of the Estate of Mildred
Louise Chandler; Patty Larimore, as
personal representative of the Estate of
Annie Larimore; the Estate of Clarice
Potter; Agape Senior, LLC; Agape Senior
Primary Care, Inc.; Agape Nursing &
Rehabilitation, Inc.; Agape Assisted
Living, Inc.; Agape Community Hospice,
Inc.; Carolinas Community Hospice, Inc.;
Scott Middleton; Floyd Cribbs, Kezia
Nixon; and Jackson & Coker Locum
Tenens, LLC d/b/a Jackson and Coker,
ORDER
Defendants.
In this declaratory judgment action, Evanston Insurance Company (“Plaintiff”) has
moved the court to certify a class pursuant to Rule 23 of the Federal Rules of Civil Procedure.
ECF No. 89. In the complaint, Plaintiff seeks a declaration of its duties to defend and indemnify
Agape Senior, LLC, and its affiliated corporations (“Agape”) against claims of negligence,
unjust enrichment, and strict tort liability arising out of allegations that Ernest Addo, posing as
Dr. Arthur Kennedy, treated Agape residents and patients without a medical license.
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For
purposes of determining coverage, Plaintiff moves this court to certify as a class all of those
patients of any Agape facility who received medical treatment from Addo during a particular
time, as described with more specificity below. Id. Agape opposes the motion. ECF No. 100.
I.
Plaintiff commenced this action pursuant to the Declaratory Judgment Act (“Act”), 28
U.S.C. § 2201, which provides that a district court “may declare” the rights of interested parties.
In deciding whether to entertain a declaratory judgment action, this court initially must consider
whether (1) “the judgment will serve a useful purpose in clarifying and settling the legal relations
in issue,” and whether (2) “it will terminate and afford relief from the uncertainty, insecurity, and
controversy giving rise to the proceeding.” Aetna Cas. & Sur. Co., 92 F.2d 321, 325 (4th Cir.
1937).
When related litigation is pending in state court, this court also must weigh
“considerations of federalism, efficiency, and comity” before adjudicating a declaratory
judgment action. Penn–Am. Ins. Co. v. Coffey, 368 F.3d 409, 412 (4th Cir. 2004) (internal
citation omitted). Among the factors this court should consider is whether the presence of
“overlapping issues of fact or law” might create unnecessary “entanglement” between the state
and federal courts. United Capitol Ins. Co. v. Kapiloff, 155 F.3d 488, 493–94 (4th Cir. 1998)
(quoting Nautilus Ins. Co. v. Winchester Homes, Inc., 15 F.3d 371, 377 (4th Cir. 1994)). The
original complaint in this case sought a declaration of Plaintiff’s duties to defend and indemnify
in Hanna v. Agape Senior, LLC, et al, 3:12-cv-02872-JFA, a putative class action removed to
this court on diversity grounds. This court exercised its discretion to hear the declaratory
judgment action pursuant to the Act. After commencing the action, Plaintiff learned of other
state court lawsuits against Agape arising out of Addo’s conduct. This court granted Plaintiff’s
motion to amend, and the complaint added as defendants the tort claimants in those pending state
court cases.
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Now, in its motion to certify a class, Plaintiff submits that the same coverage questions
will arise in any claim brought against Agape by any putative class member. To that end,
Plaintiff seeks an order from this court certifying as a class: “All of those patients of any Agape
facility who received medical treatment of any form from the individual whose true name is
Ernest Addo during the Class Period for the sole purpose of determining the existence of
coverage under Policy No. MM-822351.” ECF No. 89, at 1. The class period is defined as
February 24, 2012, through August 23, 2012. Plaintiff contends that the case is suited for a
defendant class under Rules 23(a) and 23(b)(3) of the Federal Rules of Civil Procedure. As a
prerequisite, Rule 23(a) provides that one or more class members “may . . . be sued as
representative parties on behalf of all members only if”:
(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or
defenses of the class; and
(4) the representative parties will fairly and adequately protect the interests of the class.
Fed. R. Civ. P. 23(a). Rule 23(b) provides that a class action “may be maintained if Rule 23(a) is
satisfied and if,” as is alleged here:
(3) the court finds that the questions of law or fact common to class members
predominate over any questions affecting only individual members, and that a
class action is superior to other available methods for fairly and efficiently
adjudicating the controversy. The matters pertinent to these findings include:
(A) the class members’ interests in individually controlling the prosecution or
defense of separate actions;
(B) the extent and nature of any litigation concerning the controversy already
begun by or against class members;
(C) the desirability or undesirability of concentrating the litigation of the
claims in the particular forum; and
(D) the likely difficulties in managing a class action.
Fed. R. Civ. P. 23(b).
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Among its arguments, Plaintiff submits that numerous patients at Agape’s facilities
received medical treatment from Addo in the class period; the question of whether allegations
made in the underlying litigation trigger insurance coverage raises a common issue of fact or
law; each persons within the putative class has a similar interest in whether coverage exists for
all acts and omissions alleged in the underlying litigation; and Plaintiff’s coverage question
centers on allegations in the underlying litigation.
In opposition, Agape argues that the putative class is improper, and unnecessary, because
its members are neither parties to, nor third-party beneficiaries of, the insurance policy upon
which Plaintiff seeks a declaratory judgment.
Furthermore, Agape disputes Plaintiff’s
conclusions under Rules 23(a) and 23(b)(3).
II.
Having considered the parties’ arguments and the applicable law, this court finds itself at
the intersection of the requirements of Rule 23 and the considerations mandated under the Act.
On the one hand, the Plaintiff’s wish to avoid duplicitous litigation on the particular coverage
issue before this court weighs in favor of class certification under Rule 23(a). On the other hand,
the factors this court must consider before exercising jurisdiction under the Act weigh against
certifying a class under Rule 23(b)(3).
As it stands, Plaintiff has named in its complaint the tort claimants in pending state and
federal court actions, and the court has had the opportunity to weigh the factors mandated under
the Act. Thus, to determine coverage, this court, applying general rules of contract construction,
will be able to compare the allegations in these underlying state and federal court actions with
the language in the relevant insurance policy. In light of these considerations and the abovestated factors, the court finds that the putative defendant class is undesirable and, therefore, it
declines certification. Accordingly, the court denies Plaintiff’s motion to certify a class.
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IT IS SO ORDERED.
April 15, 2014
Columbia, South Carolina
Joseph F. Anderson, Jr.
United States District Judge
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