Opinion ID: 162311
Heading Depth: 3
Heading Rank: 4

Heading: Deitz II

Text: United Educators cross-appeals the district court’s finding that it is liable for Deitz II defense costs incurred after consolidation. The district court reasoned that UE could not circumvent its clear duty under its policy to cover Deitz II costs by the fortuitous event that its insured chose to remove the case to federal court and had its consolidation motion granted. UE argues that after consolidation Farmington became the primary insurer because Farmington’s policy requires it to defend any “suit” for covered claims, and not just the individual claims. UE points out that the plaintiff and principal defendant were the same in both actions, and the case had been consolidated by the magistrate judge, who stated that it would not treat Deitz II as a new independent case. The magistrate judge stated that Deitz could have amended her first suit instead of filing a second one, and that the separate filing was likely an attempt to gain a new round of discovery for issues raised by Deitz I and Deitz II. In granting a motion for consolidation, but rejecting a request to treat Deitz II as a - 12 - separate case for purposes of discovery, the magistrate judge stated: “I do not agree that I should treat Deitz II as a new, independent case, and permit a new round of discovery the same as if Deitz I never existed.” While the magistrate judge considered Deitz I and II the same case in some respects, the context suggests that the ruling was for discovery and procedural purposes, not for purposes of determining the insurers’ contractual obligations. Lawsuits consolidated under Rule 42(a), like this one, can retain their “separate identity.” Patton v. Aerojet Ordnance Co. , 765 F.2d 604, 606 (6th Cir. 1985). In a similar case, Board of Trustees of Michigan State University v. Continental Casualty Co. , 730 F. Supp. 1408 (W.D. Mich. 1990) , an excess insurer argued that three cases filed by the same plaintiff against different defendants were so closely intertwined that the primary insurer had a duty to defend all three suits. Id. at 1413. The Board of Trustees court rejected this argument, finding that the cases were distinguishable for the purposes of allocating expenses, despite the fact that they were all assigned to the same judge and only one set of discovery and depositions was taken for all three cases. Id. The court emphasized that only one of the complaints alleged defamation, which was covered by the excess insurer’s policy. Id. We similarly find that the consolidated Deitz I and II cases retained their separate identities even after consolidation, and are distinguishable for purposes of allocating costs. We - 13 - therefore agree with the district court that UE is liable for the $50,000 in defense costs attributable solely to Deitz II.