Nautilus Insurance Company v. Larsunny, LLC et al

Filing 30

MEMORANDUM AND ORDER GRANTED 25 MOTION for Default Judgment against Larsunny, LLC, Sunny West (Signed by Judge Nancy F. Atlas) Parties notified.(sashabranner, 4)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
NAUTILUS INSURANCE COMPANY §
Plaintiff,
§
§
v.
§
§
LARSUNNY, LLC, LARS VIK,
§
SUNNY WEST, FRANK NICOLAI,
§
DEBORA NICOLAI,
§
Defendants.
§

CIVIL ACTION NO. H-14-2692

MEMORANDUM AND ORDER
This insurance coverage case is before the Court on Plaintiff Nautilus Insurance
Company’s (“Plaintiff” or “Nautilus”) Motion for Default Judgment Against
Defendants Larsunny, LLC d/b/a Sunny’s (“Larsunny”) and Sunny West (“West”) and
Motion for Summary Judgment Against Defendants Frank and Debora Nicolai
(collectively, the “Nicolais”) (“Motion”) [Doc. # 25]. Defendants Larsunny and West
have failed to respond to the Motion or Complaint, despite being properly served with
both, and have not otherwise appeared in this case. The Nicolais have appeared in this
case and asserted that they are not proper parties. See Answer [Doc. # 22], ¶ 20; Joint
Report of Meeting and Joint Discovery/Case Management Plan (“Joint Report”) [Doc.
# 26], at 6 §17. Despite being properly served, the Nicolais have failed to respond to
Plaintiff’s Motion seeking summary judgment against them, and represent that they

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do not oppose the relief sought in the Motion. Joint Report, at 6, §17; see also id., at
2, § 3.1 After reviewing the Motion, all matters of record, and the applicable legal
authorities, the Court grants Plaintiff’s Motion.
I.

BACKGROUND
Nautilus issued a general commercial liability policy (Policy No. NN391206)

to “Sunny’s,” a bar apparently owned and operated by Larsunny and West, for the
coverage period September 24, 2013, to September 24, 2014 (the “Policy”) [Doc.
# 25-2]. Nautilus seeks a declaratory judgment that, under this Policy, Nautilus has
no duty to defend or indemnify Larsunny or West in the lawsuit filed by the Nicolais
in Texas state court, styled Frank Nicolai & Debora Nicolai as Parents of Caroline
Nicolai, Deceased v. Regina Gonzalez & the City of Houston, et al., No. 2013-75121
(164th Dist. Ct., Harris Cnty., Tex.) (the “Underlying Suit”).

Complaint for

Declaratory Judgment [Doc. # 1]. Nautilus also seeks a declaratory judgment that it
has no duty to indemnify the Nicolais for any judgment obtained in the Underlying
Suit.
The Nicolais’ daughter, Caroline Nicolai, died as a result of serious injuries
sustained on October 3, 2013, in a car accident allegedly caused by a woman who was

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Pursuant to the Local Rules of the United States District Court for the Southern
District of Texas, the Nicolais’ failure to respond to the Motion is taken as a
representation of no opposition. See S.D. TEX. R. 7.3, 7.4.

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driving while intoxicated after leaving Sunny’s and after Sunny’s allegedly continued
to serve alcohol to the woman despite her obvious intoxication. Plaintiffs’ Fourth
Amended Petition [Doc. # 25-1], at 2. In the Underlying Suit, the Nicolais sue
Larsunny and West (or “Sunny’s Bar”) for dramshop violations and claims under the
Texas wrongful death statutes. Id., at 4-5.
II.

SUMMARY JUDGMENT STANDARD
Rule 56 of the Federal Rules of Civil Procedure mandates the entry of summary

judgment against a party who fails to make a sufficient showing of the existence of
an element essential to the party’s case, and on which that party will bear the burden
at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Little v. Liquid Air Corp.,
37 F.3d 1069, 1075 (5th Cir. 1994) (en banc); see also Curtis v. Anthony, 710 F.3d
587, 594 (5th Cir. 2013). “The court shall grant summary judgment if the movant
shows that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” FED. R. CIV. P. 56(a); see Celotex, 477 U.S.
at 322-23; Curtis, 710 F.3d at 594.
III.

ANALYSIS
Nautilus contends that it has no duty to defend or indemnify Larsunny or West

in the Underlying Suit because coverage is precluded by the Policy’s “Total Liquor
Liability” exclusion, which excludes liability for bodily injury or property damage

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claims by reason of “causing or contributing to the intoxication of any person.”
Policy, at ECF page 48. Nautilus also contends that coverage is precluded by the
exclusion for “Aircraft, Auto or Water,” which precludes coverage for “‘Bodily
injury’ or ‘property damage’ arising out of the ownership, maintenance, use or
entrustment to others of any aircraft, ‘auto’ or watercraft.” Id., at ECF page 36.
“Texas courts use the ‘eight corners’ or ‘complaint allegation’ rule when
determining whether an insurer has a duty to defend.” Potomac Ins. Co. of Ill. v.
Jayhawk Med. Acceptance Corp., 198 F.3d 548, 551 (5th Cir. 2000). Applying this
rule, the Court concludes that the Policy’s auto and liquor liability exclusions both are
unambiguous and enforceable. See Certain Underwriters at Lloyd’s of London v.
Kuthcins Enters., Inc., No. 4:08-CV-143-A, 2008 WL 5381244, at **4-5 (N.D. Tex.
Dec. 22, 2008) (McBryde, J.) (holding an identical liquor liability exclusion
enforceable and that it precluded claims in the underlying state court lawsuit similar
to those at bar); Colony Ins. Co. v. Acrem, Inc., Civ. Action No. H-10-1137, 2011 WL
744744, at **2-3 (S.D. Tex. Feb. 23, 2011) (Atlas, J.) (holding a similar auto
exclusion enforceable).
The Court concludes that coverage is precluded both by the “Total Liquor
Liability” exclusion and the “Aircraft, Auto or Water” exclusion. Nautilus has no
duty to defend or indemnify Larsunny or West in the Underlying Suit. Because

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Nautilus has no duty to defend or indemnify Larsunny or West in the Underlying Suit,
Nautilus also has no duty to pay the Nicolais for an award of damages, if any, that
may be rendered against Larsunny or West in the Underlying Suit. Accordingly, it is
hereby
ORDERED that Plaintiff’s Motion [Doc. # 25] is GRANTED.
The Court will issue a separate final judgment awarding Nautilus summary
judgment against the Nicolais and a separate final default judgment against Larsunny
and West.
SIGNED at Houston, Texas, this 24th day of March, 2015.

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