Cincinnati Insurance Company v. Harry Johnson Plumbing & Excavating Co Inc

Filing 121

ORDER DENYING HJPE'S MOTION FOR RECONSIDERATION, denying 99 Motion for Reconsideration. Signed by Senior Judge Lonny R. Suko. (LR, Case Administrator)

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WASHINGTON

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CINCINNATI INSURANCE
COMPANY,
Plaintiff/Counterclaim Defendant,

Case No. 4:16-CV-5090-LRS
ORDER DENYING HJPE’S MOTION
FOR RECONSIDERATION

v.
HARRY JOHNSON PLUMBING &
EXCAVATING CO., INC.,

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Defendant/Counterclaimant.

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BEFORE THE COURT is Harry Johnson Plumbing & Excavating Co., Inc.’s

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(“HJPE”) Motion for Reconsideration (ECF No. 99) of the court’s Order Granting

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Cincinnati Insurance Company’s (“CIC”) Motion for Partial Summary judgment
entered September 29, 2017. CIC has responded in opposition and HJPE has replied.
ECF Nos 115, 120. The matter is heard on an expedited basis without oral argument.
I. Legal Standard
Motions for reconsideration are generally disfavored and are considered “an

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extraordinary remedy, to be used sparingly in the interests of finality and
conservation of judicial resources.” Kona Enters., Inc. v. Estate of Bishop, 229 F.3d
877, 890 (9th Cir. 2000) (internal quotation marks omitted). As neither Rule 54(b)

ORDER - 1

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or this court’s Local Rules provide a standard, typically, district courts will apply

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standards substantially similar to those used under Rule 59(e) and 60(b). “[A]

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Motion for Reconsideration should not be granted, absent highly unusual
circumstances, unless the district court is presented with newly discovered evidence,
committed clear error, or if there is an intervening change in the controlling law.”

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Marlyn Nutraceuticals, Inc. v. Mucos Pharma GmbH & Co., 571 F.3d 873, 880 (9th

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Cir. 2009).

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Motions for reconsideration are not to re-hash arguments the court has already
thought through, or present arguments or evidence for the first time which could
reasonably have been raised earlier in the litigation. “Mere disagreement with a

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previous order is an insufficient basis for reconsideration,” and “reconsideration may

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not be based on evidence and legal arguments that could have been presented at the

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time of the challenged decision.” Haw. Stevedores, Inc. v. HT & T Co., 363
F.Supp.2d 1253, 1269 (D. Haw. 2005). “Whether or not to grant reconsideration is
committed to the sound discretion of the court.” Navajo Nation v. Confederated

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Tribes & Bands of the Yakima Indian Nation, 331 F.3d 1041, 1046 (9th Cir. 2003).

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II. ANALYSIS

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HJPE’s Motion for Reconsideration does not set forth a valid basis to
reconsider the court’s dismissal of HJPE’s bad faith and state CPA and IFCA
counterclaims. The court only briefly addresses several of the arguments raised.

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ORDER - 2

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HJPE contends the court improperly considered “new evidence” attached to

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CIC’s Reply without affording HJPE the opportunity to respond. HJPE refers to the

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Declaration of Bryana Blessinger and reply statement of facts at ECF Nos. 76-77,
which attached portions of CIC’s claim file, excerpts of the deposition of Mark
Johnson, and certain discovery including the Daily Inspection Reports. ECF No. 99

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at 2-3. HJPE did not raise this issue at oral argument at the summary judgment, did

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not request the court exercise its discretion to grant HJPE leave to file a surreply,

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and did not argue this point as a basis for its Motion to Strike it filed on September
20, 2017 prior to the summary judgment hearing. HJPE’s Motion to Strike was
withdrawn (ECF No. 88). HJPE also has not identified any basis for striking the

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material other than the fact it was attached to the Reply. This court’s Local Rules

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permit a reply by the movant to “dispute[]” or “clairif[y]” the responsive statement

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of facts, and thus, CIC, as the movant, is entitled to file the last document. See L.R.
56.1(c). In compliance with the Local Rule, CIC’s reply statement set forth facts
specifically directed at and responsive to argument and evidence in HJPE’s

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Response. The three “Additional Facts” submitted by CIC in its Reply, ECF No. 77

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at 11 (information from the deposition of HJPE’s witnesses) were ultimately

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immaterial to the court’s conclusion that HJPE had failed to meet its obligation to
come forward with evidence that CIC had acted unreasonably.
///

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Like its Response to the Motion for Summary Judgment, HJPE’s Motion for

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Reconsideration attempts to parse CIC’s denial of coverage into separate acts of

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alleged unreasonable behavior claiming that CIC unreasonably (1) denied coverage
“based on lack of information that it should have obtained during the underwriting
process;” and (2) “chose instead to deny the claim based on intentional misconduct”

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when it could have “denied the claim on the basis that HJPE did not adequately prove

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ownership of the 14H grader.” ECF No. 120 at 4. The denial of coverage letter

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clearly states: “Based on all the above, CIC has concluded that HJPE did not own a
14H Grader at the time of the loss. Therefore CIC must deny coverage for HJPE’s
claim.” ECF No. 71 at 133 (emphasis added). HJPE lacks evidence to support its

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contention that the denial of coverage was based on “suspicion or conjecture” or a

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“defense which a reasonable investigation would have proved to be without merit.”

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HJPE’s claim that CIC will not succeed at trial on its coverage defense based
upon breach of the “Concealment, Misrepresentation or Fraud” condition (at ECF
No. 1 at ¶15) because the statements made by HJPE were “merely good faith

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mistakes,” ECF No. 120 at 4, also does not preclude summary judgment. The court

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previously denied HJPE’s early Motion for Summary Judgment pertaining to this

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particular defense. See ECF No. 26. HJPE has not furnished any evidence from
which to conclude CIC’s pleading in this lawsuit is evidence of bad faith. CIC and
HJPE have the right to in good faith litigate disputed elements of coverage.

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ORDER - 4

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HJPE contends that because a jury could determine “that the testimony of

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Mark Johnson, Carol Johnson, and Pam Hardiman alone was sufficient evidence to

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prove ownership of the grader” it could also determine that “CIC’s denial was
unreasonable.” ECF No. 99 at 4. This argument fails to recognize that prevailing on
the breach of contract claim does not make CIC’s actions bad faith or unreasonable

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per se. HJPE did not produce any evidence from which to conclude that CIC’s

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continuation of the declaratory judgment action after obtaining certain testimony

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was ill-founded. See ECF No. 70 (HJPE’s Statement of Facts).
HJPE’s Motion for Reconsideration (ECF No. 99) is DENIED.
IT IS SO ORDERED.

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DATED this 23rd day of October, 2017.

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s/Lonny R. Suko
______________________________
LONNY R. SUKO
Sr. U.S. District Court Judge

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ORDER - 5