Philadelphia Indemnity Insurance Company v. NoteWorld, LLC

Filing 33

ORDER denying 26 Plaintiff's Motion to Lift Stay and Reopen Case; finding as moot 28 Plaintiff's Motion for Leave to File, signed by Judge Ronald B. Leighton.(DN)

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HONORABLE RONALD B. LEIGHTON

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT TACOMA

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PHILADELPHIA INDEMNITY
INSURANCE COMPANY,

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CASE NO. C12-5367-RBL
ORDER DENYING PLAINTIFF’S
MOTION TO REOPEN THE CASE
AND MOTION TO AMEND

Plaintiff,
v.

(Dkt. #26, 28)
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NOTEWORLD, LLC,
Defendant.

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Plaintiff Philadelphia Indemnity Insurance Company issued two insurance policies to
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Defendant NoteWorld, LLC. In this declaratory action, Philadelphia seeks a determination of its
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coverage obligations under these policies. Consistent with each policy’s binding arbitration
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provision, the parties agreed to submit their dispute to arbitration. This Court stayed the
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declaratory action pending the outcome of that arbitration.
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Philadelphia now moves to reopen the case and lift the stay in light of a recent
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Washington Supreme Court decision. State Dep’t of Transp. v. James River Ins. Co. (WSDOT),
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292 P.3d 118 (Wash. 2013). WSDOT held that RCW 48.18.200 prohibits binding arbitration
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agreements in insurance contracts. Id. at 123.
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WSDOT is distinguishable from this case. In WSDOT, the insurer sought to force the

2 insured to arbitrate over the insured’s objection. Id. at 119. The WSDOT decision therefore
3 applies to an attempt by an insurer to impose arbitration on an unwilling insured. Here, the
4 insured, NoteWorld, willingly seeks to enforce the binding arbitration terms against the insurer,
5 Philadelphia. Def.’s Reply, Dkt. #31 at 2. Thus, Philadelphia cannot rely on WSDOT to remove
6 this case from arbitration.
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Further, Philadelphia and NoteWorld both agreed to arbitrate this case. Philadelphia did

8 not contest NoteWorld’s Motion to Compel Arbitration. Philadelphia also did not notify the
9 Court of the then-pending decision in WSDOT or seek a continuance pending the decision in
10 WSDOT. Instead, Philadelphia proposed the stipulation for binding arbitration, which was not
11 subject to any contingency. Dkt. #23. Philadelphia is therefore bound by its stipulation.
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For these reasons, Philadelphia’s Motion to Reopen the Case and Lift the Stay (Dkt. #26)

13 is DENIED. Its Motion to Amend (Dkt. #28) is DENIED as moot.
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IT IS SO ORDERED.

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Dated this 23rd day of April, 2013.

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A

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RONALD B. LEIGHTON
UNITED STATES DISTRICT JUDGE

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