Ironshore Specialty Insurance v. Callister Nebeker & McCullough et al

Filing 32

MEMORANDUM DECISION AND ORDER granting 18 Old Republics Motion to Dismiss for Failure to State a Claim ; granting 20 Ironshores Motion to Dismiss for Failure to State a Claim. The court dismisses Mr. Stephensons First Amended Counterclaim and Third-Party Claims (Dkt. 14). Signed by Judge Robert J. Shelby on 2/17/2016. (jds)

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH
CENTRAL DIVISION
IRONSHORE SPECIALTY INSURANCE
COMPANY,

MEMORANDUM DECISION AND
ORDER

Plaintiff,
v.

Case No. 2:15-cv-00677-RJS

CALLISTER, NEBEKER &
McCULLOUGH, PC; W. WALDAN
LLOYD; and J. HOYT STEPHENSON,

Judge Robert J. Shelby

Defendants,
J. HOYT STEPHENSON,
Third-Party Plaintiff,
v.
OLD REPUBLIC INSURANCE
COMPANY,
Third-Party Defendant.
This insurance dispute arises out of a malpractice suit in Utah state court. Defendant and
Third-Party Plaintiff J. Hoyt Stephenson sued the law firm of Callister, Nebeker & McCullough,
P.C. and one of its attorneys, J. Waldan Lloyd, in Utah state court for legal malpractice. Plaintiff
Ironshore Specialty Insurance Company then brought this suit, seeking a declaratory judgment
that Mr. Stephenson’s malpractice claims against Callister are not covered under any insurance
policy Ironshore issued to Callister and that Ironshore owes no duty to defend or indemnify
Callister against those claims.
Mr. Stephenson counterclaimed against Ironshore and brought third-party claims against
1

Old Republic Insurance Company, which also issued an insurance policy to Callister. Mr.
Stephenson brings claims against both insurance companies for breach of contract, breach of the
implied covenant of good faith and fair dealing, insurance bad faith and breach of fiduciary
duties, intentional infliction of emotional distress, and civil conspiracy. He also seeks a
declaratory judgment concerning the rights and duties of all parties.
Ironshore and Old Republic now separately move to dismiss Mr. Stephenson’s claims
against them under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon
which relief can be granted. For the reasons stated below, the court GRANTS the motions and
DISMISSES Mr. Stephenson’s claims.
BACKGROUND
Because this matter is before the court on motions to dismiss, the court accepts as true the
well-pleaded factual allegations in Mr. Stephenson’s First Amended Answer, Counterclaim, and
Third-Party Complaint, and views those facts in the light most favorable to Mr. Stephenson as
the nonmoving party.1
In February 2014, Mr. Stephenson sued Callister, Nebeker & McCullough, P.C. and W.
Waldan Lloyd (collectively “Callister”) in Utah state court for malpractice. Mr. Stephenson’s
claims arise out of legal services Callister performed for him in connection with various business
entities and transactions. Mr. Stephenson alleges in the state court action that Callister breached
its professional, ethical, fiduciary, and other duties owed to him.
For example, Mr. Stephenson alleges that Mr. Lloyd sent a letter to a third party in 2010,
in which Mr. Lloyd falsely accused Mr. Stephenson of committing serious state and federal
felonies and breaches of fiduciary duties. Mr. Stephenson claims that Callister’s malpractice
caused him to lose business; to be investigated for alleged crimes and civil breaches; to be
1

See Carroll v. Lawton Indep. Sch. Dist. No. 8, 805 F.3d 1222, 1226 (10th Cir. 2015).

2

charged by the State of Utah with serious felonies, which have now been dismissed with
prejudice; to be arrested during a traumatic traffic stop and wrongfully jailed; to face an ongoing
and imminent threat that his remaining business and livelihood will be destroyed; and to suffer
serious emotional harm.
Mr. Stephenson maintains that both Ironshore Specialty Insurance Company and Old
Republic Insurance Company have duties to indemnify and defend Callister from potential
liability in the state court action. Mr. Stephenson bases that claim on Callister’s alleged
representations to that effect during discovery in the state court action. These claimed duties to
indemnify and defend stem from the insurance policies that Ironshore and Old Republic each
issued to Callister.
The insurance policy that Ironshore issued to Callister states in relevant part:
Section I.A. The Insurer shall pay on behalf of each Insured all sums the
Insured shall become legally obligated to pay as Damages as a result of a
Claim first made against the Insured during the Policy Period and reported to
the Insurer during the Policy Period and arising out of the rendering of or
failure to render Professional Legal Services.
Section I.B. The Insurer shall have the right and duty to defend any Claim first
made against the Insured during the Policy Period and reported to the Insurer
during the Policy Period and arising out of the rendering of or failure to render
Professional Legal Services, including an appeal thereof, seeking Damages to
which this insurance applies even if any of the allegations are groundless,
false, or fraudulent. The Insurer shall have the right to appoint defense counsel
and to make any investigation it deems necessary and, with the written consent
of the Insured, settle any Claim covered by the terms of this Policy. If the
Insured shall refuse to consent to any settlement or compromise recommended
by the Insurer and acceptable to the claimant and shall elect to contest the
Claim, then the liability of the Insurer under this Policy shall not exceed the
amount for which the Insurer would have been liable for Damages and Claim
Expenses if the Claim had been settled or compromised, when and as so
recommended. The Insurer shall have no liability for Claim Expenses incurred
thereafter and shall have the right to withdraw from further investigation or
defense of the Claim by tendering control of such investigation or defense to
the Insured, and the Insured agrees, as a condition of the issuance of this
Policy, to accept such tender.
3

Section X.P. Bankruptcy or insolvency of the Insured shall not relieve the
Insurer of any of its obligations under this policy.2
Similarly, the insurance policy that Old Republic issued Callister states in relevant part:
Section 1. Coverage. The COMPANY shall pay on behalf of the INSURED
all sums in excess of the deductible which the INSURED shall become legally
obligated to pay as DAMAGE as a result of any CLAIM first made against the
INSURED during the POLICY PERIOD and reported in writing to the
COMPANY during the POLICY PERIOD or within thirty (30) days after the
end of the POLICY PERIOD. The CLAIM must be caused by an act, error or
omission of the INSURED committed in the performance of PROFESSIONAL
SERVICES for others and committed on or after the RETROACTIVE DATE.
Section 2. Defense and Settlement of Claims. The COMPANY shall have the
right and the duty to defend any CLAIM seeking DAMAGES to which this
POLICY applies even if any allegations of the CLAIM are groundless, false or
fraudulent. The INSURED and the COMPANY shall mutually agree upon the
selection of defense counsel to conduct the defense of any CLAIM.
The COMPANY may investigate any CLAIM as it deems necessary, but the
COMPANY shall not settle any CLAIM without the INSURED’s consent. If,
however, the INSURED refuses to consent to a settlement recommended by
the COMPANY, and acceptable to the claimant, then the COMPANY’S total
liability for such CLAIM shall not exceed the amount for which the CLAIM
could have been settled plus the DEFENSE COSTS incurred up to the time of
such refusal, or the applicable limit of insurance, whichever is less.
Section 16. Bankruptcy. Bankruptcy or insolvency of the INSURED or of the
INSURED’S estate shall not relieve the COMPANY of any of its obligations
under this POLICY.
Mr. Stephenson maintains that, despite these insurance policies, neither Ironshore nor Old
Republic has agreed to indemnify or defend Callister from potential liability in the state court
action. And even though Mr. Stephenson allegedly made an objectively reasonable settlement
offer to Callister, neither Callister, nor Ironshore, nor Old Republic has responded to the offer.

2

When evaluating the sufficiency of a complaint under Federal Rule of Civil Procedure 12(b)(6), a court may
consider documents referred to in the pleading—such as the insurance contracts—“if the documents are central to
the . . . claim and the parties do not dispute the documents’ authenticity.” Jacobsen v. Deseret Book Co., 287 F.3d
936, 941 (10th Cir. 2002). Here, the insurance contracts are central to Mr. Stephenson’s claims against Ironshore
and Old Republic, and none of the parties dispute their authenticity. The court may consider the insurance contracts.

4

In an attempt to confirm his belief that Ironshore and Old Republic must indemnify and
defend Callister, Mr. Stephenson subpoenaed Ironshore and Old Republic to produce documents
relating to the malpractice action. The subpoenas also ordered the insurance companies to testify
on whether they are obligated to indemnify and defend Callister in the state court action. Both
Ironshore and Old Republic objected to the subpoena served upon it on work product grounds.
In September 2015, Ironshore sued Callister and Mr. Stephenson in this court. Ironshore
seeks a declaratory judgment that Mr. Stephenson’s legal malpractice claims against Callister are
not covered under any insurance policy Ironshore issued to Callister and that Ironshore owes no
duty to indemnify or defend Callister against those claims.3
Mr. Stephenson then counterclaimed against Ironshore and brought third-party claims
against Old Republic. Mr. Stephenson asserts the following claims against both insurers under
Utah law: (1) breach of contractual duty to indemnify Callister and Mr. Stephenson, (2) breach of
the implied covenant of good faith and fair dealing, (3) insurance bad faith and breach of
fiduciary duties, (4) intentional infliction of emotional distress, and (5) civil conspiracy. Mr.
Stephenson also seeks a declaratory judgment regarding the rights and duties of all parties.4
ANALYSIS
Ironshore moves under Federal Rule of Civil Procedure 12(b)(6) to dismiss Mr.
Stephenson’s counterclaims. Old Republic likewise moves to dismiss Mr. Stephenson’s third3

Ironshore asserts that it joined Mr. Stephenson as a party in this case so he would be bound by any declaratory
judgment the court may issue. See Harris v. Quinones, 507 F.2d 533, 537 (10th Cir. 1974).
4
Mr. Stephenson also asserts that Ironshore and Old Republic owe Callister and himself the following duties: (i) a
duty to indemnify Callister and himself for the claims he has asserted in the state court action; (ii) a duty to
diligently investigate the facts to determine whether his malpractice claims against Callister are valid; (iii) a duty to
evaluate his claims fairly; (iv) a duty to engage counsel in the state court action who do not act unreasonably and do
not assert objectively unreasonable or frivolous claims, defenses, or positions; (v) a duty to act promptly, zealously,
and reasonably in accepting, rejecting, or settling his claims in the state court action; (vi) a duty to act objectively
reasonable in dealing with Callister and himself; and (vii) a duty not to unreasonably diminish the amount of funds
available for indemnification by asserting frivolous or bad faith claims or defenses in the state court action. Though
Mr. Stephenson does not bring specific causes of action under these duties, he contends that Ironshore and Old
Republic have breached each of these duties.

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party claims under Federal Rule 12(b)(6).
The court’s analysis proceeds in three parts. First, the court provides the applicable legal
standard. Second, the court examines each of Mr. Stephenson’s substantive claims. And third,
the court discusses Mr. Stephenson’s request for a declaratory judgment.
In the end, the court concludes that Mr. Stephenson has failed to state a single valid claim
for relief, and that dismissal is appropriate.
Legal Standard

I.

To survive a Federal Rule 12(b)(6) motion to dismiss, Mr. Stephenson must “state a claim
upon which relief can be granted,” meaning Mr. Stephenson must allege “enough factual matter,
taken as true, to make his ‘claim to relief . . . plausible on its face.’”5 “A claim has facial
plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.”6 In undertaking this analysis,
the court is instructed to “accept all well-pleaded facts as true and view them in the light most
favorable to the plaintiff.”7 But the court will not accept as true “legal conclusions” or
“[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory
statements.”8
Mr. Stephenson’s Substantive Claims

II.

The court now turns to Mr. Stephenson’s affirmative claims against Ironshore and Old
Republic. The court examines each of his following claims in turn: (A) breach of contract,
(B) breach of the implied covenant of good faith and fair dealing as well as insurance bad faith,

5

Bryson v. Gonzales, 534 F.3d 1282, 1286 (10th Cir. 2008) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)).
6
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
7
Jordan-Arapahoe, LLP v. Bd. of Cnty. Comm’rs, 633 F.3d 1022, 1025 (10th Cir. 2011) (quoting Beedle v. Wilson,
422 F.3d 1059, 1063 (10th Cir. 2005)).
8
Iqbal, 556 U.S. at 678.

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(C) intentional infliction of emotional distress, and (D) civil conspiracy.
A. Breach of Contract
Mr. Stephenson’s first cause of action against Ironshore and Old Republic is for breach of
contract. Under Utah contract law, only a party to an insurance contract has a right to enforce the
contract, unless the claimant is an assignee or an intended third-party beneficiary of the contract.9
The parties agree that Mr. Stephenson is neither a party to nor an assignee of the insurance
contracts involved in this case. The issue presented is whether Mr. Stephenson may bring his
breach of contract claims as an intended third-party beneficiary of the contracts.10
Intended “[t]hird-party beneficiaries are those recognized as having enforceable rights
created in them by a contract to which they are not parties and for which they give no
consideration.”11 “For a third party to have an enforceable right, the contracting parties must
have clearly intended to confer a separate and distinct benefit upon the third party.”12 “A third
party who benefits only incidentally from the performance of a contract has no right to recover
under that contract.”13
Mr. Stephenson contends that he is an intended third-party beneficiary of the Ironshore
and Old Republic insurance contracts because Callister and the insurers intended to confer upon
him separate and distinct rights. Mr. Stephenson points to the bankruptcy provisions in each

9

See City of Grantsville v. Redev. Agency, 233 P.3d 461, 466 (Utah 2010); see also Adams v. Gen. Accident
Assurance Co. of Canada, 133 F.3d 932, at *3 (10th Cir. 1997) (unpublished) (“‘In Utah, a plaintiff must direct his
action against the actual tortfeasor, not the insurer’ because an injured party ‘has no direct cause of action against the
insurer.’” (quoting Campbell v. Stagg, 596 P.2d 1037, 1039 (Utah 1967))); County v. Jensen, 83 P.3d 405, 408 (Utah
Ct. App. 2003) (noting that “Utah adheres to the ‘general rule,’ that in the absence of a contractual provision or
statute or ordinance to the contrary, the absence of privity of contract between the injured party and the tortfeasor’s
insurer bars a direct action by the injured party against the insurer” (citation omitted) (internal quotation marks
omitted)).
10
See Orlando Millenia, LC v. United Title Serv. of Utah, Inc., 355 P.3d 965, 972 (Utah 2015) (“In contract law, a
third party has standing to sue if it is an intended, and not merely an incidental, beneficiary.”).
11
Broadwater v. Old Republic Sur., 854 P.2d 527, 536 (Utah 1993) (citation omitted) (internal quotation marks
omitted).
12
Id.
13
Id. at 537.

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contract in support of his argument. The provisions—which are nearly identical—state that
Callister’s bankruptcy or insolvency will not relieve the insurers of their obligations under the
policies. Mr. Stephenson argues that the provisions establish that the central aim of the policies
is to benefit third parties like him by ensuring that injured third parties possess the right to collect
directly from the insurer even if the insured becomes bankrupt or insolvent.
The court disagrees with Mr. Stephenson’s interpretation of the bankruptcy provisions,
and concludes that he is not an intended third-party beneficiary of the insurance contracts. The
court relies on two cases for this conclusion: the Utah Supreme Court’s decision in Broadwater v.
Old Republic Surety and the Tenth Circuit’s decision in Adams v. General Accident Assurance
Co. of Canada.
First, the Utah Supreme Court held in Broadwater that plaintiff, an injured third party,
was not an intended third-party beneficiary of a lost instruments bond, because nothing in the
bond indicated that the parties to the bond intended to confer on plaintiff the right to enforce
payment.14 The bond listed only the insured as obligees, the bond’s purpose was to indemnify
the insured against third-party claims, and “[p]erformance on the bond only incidentally
benefit[ted] plaintiff by providing a fund from which her damages may ultimately be paid.”15
Second, the Tenth Circuit held in Adams that the injured third-party judgment creditors
were not intended third-party beneficiaries of the insurance contract between the tortfeasor and
the torfeasor’s insurer.16 The court stated that, although an injured party may benefit under the
contract if the insurer pays, “the intent of the parties to the policy is to protect the financial wellbeing of the insured, not to benefit the injured party.”17 This intent was reflected by the insurer’s

14

Id.
Id.
16
133 F.3d at *4–5.
17
Id. at *4.
15

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agreement to “pay and to defend its insured, not an injured party.”18 Accordingly, the court
found that “the benefit[s of the policy] flow[] to the injured party only incidentally.”19
This case is analogous. Nowhere in the bankruptcy provisions or elsewhere in the
insurance contracts do the contracting parties refer to Mr. Stephenson or purport to provide him
(or other third-party claimants) with any enforceable rights. Instead, the provisions merely state
that if Callister goes bankrupt or becomes insolvent, the insurers’ obligations to Callister will
continue. Those obligations include the insurers’ duties to indemnify and defend Callister under
certain conditions. They do not include any duties owed to Mr. Stephenson or other third-party
claimants.
Moreover, the contracting parties included the indemnity, defense, and bankruptcy
provisions to protect the financial well-being of Callister, not to benefit third parties injured by
the law firm’s alleged malpractice. While Mr. Stephenson may ultimately receive a benefit under
one of the contracts if one of the insurers is obligated to indemnify Callister, that benefit will
flow to Mr. Stephenson only incidentally because performance of the contracts merely provides a
fund from which his damages may be paid.
Mr. Stephenson is not privy to the insurance contracts at issue in this case, because he is
not an intended third-party beneficiary under either contract. Mr. Stephenson may not assert his
breach of contract claims directly against Ironshore and Old Republic. The court dismisses Mr.
Stephenson’s breach of contract claims with prejudice.
B. Breach of the Implied Covenant of Good Faith and Fair Dealing, and Tortious
Insurance Bad Faith
Mr. Stephenson’s next causes of action against Ironshore and Old Republic are for
(1) breach of the implied covenant of good faith and fair dealing and (2) tortious insurance bad
18
19

Id.
Id.

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faith. The court considers these overlapping claims together.
The duty of an insurer to deal fairly under both of Mr. Stephenson’s causes of action
derives from the insurance contract.20 In the absence of a contractual relationship or statutory
duty, an injured third party may not sue a tortfeasor’s insurer for failure to bargain in good
faith.21 Accordingly, Utah courts have consistently held that only first parties to an insurance
contract or their privies may bring an action for breach of the implied covenant of good faith and
fair dealing, or for tortious insurance bad faith.22
Here, although it is undisputed that Mr. Stephenson is a first party to neither insurance
contract at issue, he nevertheless alleges that both Ironshore and Old Republic owe him a duty of
good faith and fair dealing as well as fiduciary duties. But as explained above, Mr. Stephenson is
not privy to either contract: he is neither an assignee, nor an intended third-party beneficiary.
And even if he were an intended third-party beneficiary under either contract, the duty of good
faith is not owed to third-party beneficiaries—it is owed only to first parties.23
Mr. Stephenson lacks standing to bring claims against Ironshore or Old Republic for
breach of the implied covenant of good faith and fair dealing or for tortious insurance bad faith.
Those claims are dismissed with prejudice.

20

Broadwater, 854 P.2d at 535.
Id. at 535–36.
22
See Sperry v. Sperry, 990 P.2d 381, 383 (Utah 1999) (recognizing that “Utah law clearly limits the duty of good
faith to first parties to insurance contracts” and that “only a first party can sue for breach of that duty”); Savage v.
Educators Ins. Co., 908 P.2d 862, 865 (Utah 1995) (holding that “an action for breach of the covenant of good faith
and fair dealing may be brought only by a party to the insurance contract”); id. at 866 (stating that the “duty of good
faith and fair dealing is a contractual covenant, one that arises solely as an incident to contractual obligations owed
by an insurer to its insured”); Ammerman v. Farmers Ins. Exch., 430 P.2d 576, 577–78 (Utah 1967) (holding that the
tort cause of action for insurance bad faith is available only to first parties to an insurance contract, not third-party
beneficiaries); Cannon v. Travelers Indem. Co., 994 P.2d 824, 828 & n.3 (Utah Ct. App. 2000) (noting that “[i]t is
well settled that the duty of good faith and fair dealing runs to parties to an insurance contract or their privies,” and
rejecting the third-party claimant’s argument that she is owed a duty of good faith and fair dealing as a third-party
beneficiary, because the duty is owed only to first parties to insurance contracts); Pixton v. State Farm Mut. Auto.
Ins. Co., 809 P.2d 746, 749 (Utah Ct. App. 1991) (holding that “there is no duty of good faith and fair dealing
imposed upon an insurer running to a third-party claimant . . . seeking to recover against the company’s insured”).
23
See Sperry, 990 P.2d at 383.
21

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C. Intentional Infliction of Emotional Distress
Mr. Stephenson’s next claim against Ironshore and Old Republic is for intentional
infliction of emotional distress. To state a claim for intentional infliction of emotional distress
under Utah law, a plaintiff must plead facts showing that the defendant:
intentionally engaged in some conduct toward the plaintiff, (a) with the
purpose of inflicting emotional distress, or, (b) where any reasonable person
would have known that such would result; and his actions are of such a nature
as to be considered outrageous and intolerable in that they offend against the
generally accepted standards of decency and morality.24
“If the trial court determines that a defendant’s conduct was not outrageous as a matter of
law, then the plaintiff’s claim fails.”25 “To be considered outrageous, the conduct must evoke
outrage or revulsion; it must be more than unreasonable, unkind, or unfair.”26 “[C]onduct is not
outrageous simply because it is tortious, injurious, or malicious, or because it would give rise to
punitive damages, or because it is illegal.”27
Here, Mr. Stephenson has not alleged sufficient facts to state a plausible claim against
Ironshore and Old Republic for intentional infliction of emotional distress. He alleges that the
insurers’ conduct toward him was “intentional and reckless” and was “of such a nature as to be
considered outrageous and intolerable in that it offends generally accepted standards of decency
and morality.”28 He also alleges that “the Insurers’ delay and protection of Callister[] have
severely weakened and harmed [him] financially, socially[,] and emotionally.”29 But these
allegations are legal conclusions that are not entitled to any assumption of truth under Iqbal.

24

Bennett v. Jones, Waldo, Holbrook & McDonough, 70 P.3d 17, 30 (Utah 2003) (citation omitted).
Prince v. Bear River Mut. Ins. Co., 56 P.3d 524, 536 (Utah 2002).
26
Franco v. The Church of Jesus Christ of Latter-day Saints, 21 P.3d 198, 207 (Utah 2001) (citation omitted)
(internal quotation marks omitted); see also Retherford v. AT&T Commc’ns of Mountain States, Inc., 844 P.2d 949,
977 n.19 (Utah 1992) (describing outrageous conduct as “extraordinarily vile conduct, conduct that is atrocious, and
utterly intolerable in a civilized community” (citation omitted) (internal quotation marks omitted)).
27
Prince, 56 P.3d at 536.
28
Dkt. 14, ¶¶ 107–08.
29
Id. ¶ 110.
25

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Mr. Stephenson also alleges no facts plausibly showing that Ironshore or Old Republic
intentionally engaged in conduct toward him with the purpose of inflicting emotional distress.
While Mr. Stephenson claims that the insurers acted with “callous disregard for [him] during the
period in which the Insurers [] had notice and knowledge of the harm that they . . . caus[ed]
[him],”30 he pleads no facts supporting this legal conclusion.
And Mr. Stephenson has failed to allege facts showing that the insurers proximately
caused him to suffer severe emotional distress. He instead states in a conclusory fashion that
“[t]he Insurers’ conduct has foreseeably and proximately caused Stephenson sever[e] emotional
distress.”31
These bare allegations are insufficient to state a claim for intentional infliction of
emotional distress upon which relief can be granted. The claim is dismissed.
D. Civil Conspiracy
Mr. Stephenson’s final claim against Ironshore and Old Republic is for civil conspiracy.
To state a claim for civil conspiracy, a plaintiff must adequately plead the existence of an
underlying tort.32 Where a plaintiff has “not adequately pleaded any of the basic torts [he]
allege[s] dismissal of [his] civil conspiracy claim is appropriate.33
Here, Mr. Stephenson’s conspiracy claim is based on the underlying torts of insurance
bad faith and intentional infliction of emotional distress. But as discussed above, he has failed to
adequately plead either of those tort causes of action. The court dismisses Mr. Stephenson’s
claim for civil conspiracy.

30

Id. ¶ 111.
Id. ¶ 115.
32
Puttuck v. Gendron, 199 P.3d 971, 978 (Utah Ct. App. 2008).
33
Id. (citation omitted) (internal quotation marks omitted).
31

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III.

Declaratory Judgment
Finally, Mr. Stephenson seeks a declaratory judgment regarding the rights and duties of
all parties as they relate to the insurance contracts. His request is based on his contention that he
is an intended third-party beneficiary of the insurance contracts. But as explained above, Mr.
Stephenson is not an intended third-party beneficiary of either contract. The court dismisses Mr.
Stephenson’s claim for declaratory relief with prejudice.
CONCLUSION
For the reasons stated above, the court GRANTS Ironshore’s motion to dismiss (Dkt. 20)
and Old Republic’s motion to dismiss (Dkt. 18). The court dismisses Mr. Stephenson’s First
Amended Counterclaim and Third-Party Claims (Dkt. 14).
SO ORDERED this 17th day of February, 2016.
BY THE COURT:

___________________________
ROBERT J. SHELBY
United States District Judge

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