Encompass Insurance Company v. Norcold Inc

• Court: District Court, W.D. Washington
• Decided: December 26, 2024
• Docket: 2:23-cv-00231
• Status: Unknown

Opinion

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3 4 5 UNITED STATES DISTRICT COURT 6 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 ENCOMPASS INSURANCE CASE NO. 2:23-cv-231 8 COMPANY, as subrogee of Stephen and Stephanie Phillips, ORDER 9 Plaintiff, 10 v. 11 NORCOLD INC., 12 Defendant. 13 ESSENTIA INSURANCE COMPANY, 14 Intervention Plaintiff, 15 v. 16 NORCOLD INC., 17 Intervention Defendant. 18 19 The Court raises this matter sua sponte. 20 Subrogation-plaintiff Encompass Insurance Company (“Encompass”) brings 21 this product liability suit against Defendant Norcold, Inc. (“Norcold”), alleging that 22 a defective Norcold refrigerator caused a fire that destroyed Stephen and Stephanie 23 1 Phillips’ (“insureds”) garage building, recreational vehicle (“RV”), and other 2 property. Dkt. No. 1-2. Now before the Court is Norcold’s motion for sanctions for

3 spoliation. Dkt. No. 55. 4 In this motion, Norcold argues that Encompass wrongfully destroyed 5 material evidence when it authorized demolition of the insureds’ garage building 6 and RV before Norcold could inspect the fire scene. Dkt. No. 55. Encompass 7 counters that it authorized demolition of the fire scene to mitigate damages, and 8 that it dutifully preserved the only three items of evidence that its expert identified

9 as possible ignition factors: the Norcold refrigerator, a nearby heating machine, and 10 a nearby dehumidifier. Dkt. No. 57. But in its reply, Norcold disputes the notion 11 that these three items were indeed “the only possible ignition sources for the fire[.]” 12 Dkt. No. 65 at 4 (quoting Dkt. No. 57 at 8). To the contrary, Norcold asserts that the 13 garage building’s electrical system, as well as the RV’s electrical system, may have 14 caused the fire. Id. at 4-6. In support of this argument, Norcold cites and attaches 15 an expert report (“Perryman Report”) aiding its position. See Dkt. No. 65-2.

16 Norcold presents this argument, backed by the Perryman Report, for the first 17 time in its reply brief. “Ordinarily, the Court will not consider issues raised for the 18 first time in a reply brief.” Yageo Am. Corp. v. Tseng, No. C06-0227RSL, 2006 WL 19 8454994, at *1 (W.D. Wash. Apr. 21, 2006). “District courts in this Circuit have 20 ruled that ‘it is improper for a party to raise a new argument in a reply brief[,]’ 21 largely because the opposing party may be deprived of an opportunity to respond.”

22 Id. (quoting United States v. Boyce, 148 F. Supp. 2d 1069, 1085 (2001)). But a 23 “district court [has] discretion to consider [an] issue even if it was raised in a reply 1 brief.” See Glenn K. Jackson Inc. v. Roe, 273 F.3d 1192, 1202 (9th Cir. 2001). “In 2 particular, a surreply filed by the non-moving party may afford an adequate

3 opportunity to respond.” Yageo Am. Corp., 2006 WL 8454994, at *1 (citing Cedar- 4 Sinai Med. Center v. Shalala, 177 F.3d 1126, 1129 (9th Cir. 1999)). 5 The Court finds that it was improper for Norcold to present the conclusions 6 from the Perryman Report for the first time in its reply brief. To ensure that 7 Encompass has a full and fair opportunity to respond, the Court sua sponte grants 8 Encompass FOURTEEN (14) days to file an optional sur-reply of no more than

9 FIVE (5) pages addressing only those matters raised for the first time in Norcold’s 10 reply brief. 11 It is so ORDERED. 12 Dated this 26th day of December, 2024. 13 a Jamal N. Whitehead 14 United States District Judge 15 16 17 18 19 20 21 22 23