Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_05-cv-05202/USCOURTS-cand-4_05-cv-05202-11/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1332 Diversity-Insurance Contract

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United States District Court

For the Northern District of California

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3Much of Plaintiff's argument is focused on its right to

settle claims. However, even if it is entitled to settle claims,

it remains that Defendant agrees to indemnify Plaintiff only

"against losses or damages which [Plaintiff] is legally obligated

to pay." Craig Decl., Ex. C. 

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Plaintiff also argues that, even absent an obligation to

"follow the settlements," it need only demonstrate that it was at

least potentially liable on the underlying claim. Plaintiff's

Opposition and Cross-Motion at 4. However, as noted above, in

order to prevail at trial, Plaintiff must establish that it

actually was liable. 

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of questions of fact and weighing of conflicting evidence.

Plaintiff argues that the above cited provisions in the

American Re agreement "clearly and unambiguously provided AMICO

with the right to settle claims when AMICO made a final

determination that the claims or suits were covered by the AMICO

policies reinsured by American Re."3

 Plaintiff's Opposition and

Cross-Motion at 2. In attempting to establish that the claims are

covered, Plaintiff merely argues that "on October 5, 2003, SNIC

made a determination based on its investigation of the Parsons

claim that a Montana court would rule that the SNIC certificate

provided coverage for the Parsons lawsuit."4 Opposition and CrossMotion at 8. In making this argument, Plaintiff essentially

repeats its "follow-the-fortunes" theory, arguing that it is

entitled to settle cases under the contract, there is no evidence

that it settled the Parsons claim in bad faith and, therefore,

Defendant is obliged to reimburse it for the settlement. This is

not enough.

Nonetheless, the Court notes that the exhibits filed in

support of Plaintiff's motion, including the three lawyers'

opinions and the MLRs prepared by SNIC, demonstrate that a triable

Case 4:05-cv-05202-CW Document 165 Filed 11/21/07 Page 1 of 2
United States District Court

For the Northern District of California

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5Plaintiff's motions to strike evidence and argument are

DENIED as moot (Docket Nos. 161, 162). The Court did not rely on

any improper or inadmissible evidence in deciding the parties'

motions for summary judgment.

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question of fact exists regarding whether the Parsons claim was

covered by the SNIC certificate. Therefore, the Court denies

Defendant's motion for summary judgment. At the same time,

Plaintiff's cross-motion for summary judgment is based on the

mistaken argument that Defendant bears the burden of establishing

that "a Montana Court would rule that the Parsons Claims would not

be covered." Opposition and Cross-Motion at 15. As discussed

above, Plaintiff bears the burden of establishing that it was

liable for the Parsons claim based on the SNIC certificate.

Therefore, the Court denies Plaintiff's cross-motion.

CONCLUSION

For the foregoing reasons, the Court DENIES Defendant's motion

for summary judgment (Docket No. 142) and DENIES Plaintiff's crossmotion for summary judgment (Docket No. 148).5 The case will

proceed to jury trial as scheduled on Monday, November 26, 2007.

IT IS SO ORDERED.

Dated: 11/21/07 

CLAUDIA WILKEN

United States District Judge

Case 4:05-cv-05202-CW Document 165 Filed 11/21/07 Page 2 of 2