Gum Springs Corporation v. Master Drilling USA, LLC

CourtDistrict Court, N.D. West Virginia
DecidedMarch 26, 2025
Docket1:23-cv-00104
StatusUnknown

This text of Gum Springs Corporation v. Master Drilling USA, LLC (Gum Springs Corporation v. Master Drilling USA, LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. West Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gum Springs Corporation v. Master Drilling USA, LLC, (N.D.W. Va. 2025).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF WEST VIRGINIA CLARKSBURG

GUM SPRINGS CORPORTATION,

Plaintiff,

v. CIVIL ACTION NO. 1:23-CV-104 (KLEEH)

MASTER DRILLING USA, LLC and CHUBB INSURANCE COMPANY OF CANADA,

Defendants.

MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT’S MOTIONS TO DISMISS [ECF NOS. 4, 20, 46] Pending before the Court are Defendant Chubb Insurance Company of Canada’s Motion to Dismiss [ECF No. 4] and Motion to Dismiss Cross-Claim [ECF No. 20] pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure and the Doctrine of Forum Non Conveniens, as well as Defendant’s Renewed Motion to Dismiss [ECF No. 46]. For the reasons that follow, Defendant Chubb Insurance Company of Canada’s Motions are GRANTED. I. PROCEDURAL HISTORY On November 17, 2023, Plaintiff Gum Springs Corporation (“Plaintiff” or “Gum Springs”) filed a Complaint against Defendants Master Drilling USA, LLC (“Master Drilling USA”) and Chubb Insurance Company of Canada (“Chubb Canada”) (collectively “Defendants”). Compl., ECF No. 1-1. On December 19, 2023, Chubb Canada removed the action from the Circuit Court of Monongalia County, West Virginia, to the United States District Court for the Northern District of West Virginia. Id. On December 29, 2023, Chubb Canada filed Chubb Insurance Company of Canada’s Motion to Dismiss Pursuant to Fed. R. Civ. P. 12(b)(2) and Under the Doctrine of Forum Non Conveniens [ECF No. 4] Plaintiff responded in opposition

to the Motion on January 12, 2024 [ECF No. 7], and Chubb Canada filed a reply in support on January 19, 2024. ECF No. 8. Thereafter, Master Drilling USA filed its answer and asserted a crossclaim, pursuant to Rule 13(g) of the Federal Rules of Civil Procedure, against Chubb Canada. ECF No. 15. On March 25, 2024, Chubb Canada filed Defendant Chubb Insurance Company of Canada’s Motion to Dismiss Master Drilling USA, LLC’s Cross Claim Pursuant to Fed. R. Civ. P. 12(b)(2) and Under the Doctrine of Forum Non Conveniens [ECF No. 20]. Master Drilling USA responded in opposition to the Motion on April 8, 2024 [ECF No. 22], and Chubb Canada filed a reply in support on April 15, 2024 [ECF No. 24].

On June 20, 2024, the Court convened for a hearing on Chubb Canada’s Motions. Following the hearing, the Court ordered the parties to engage in limited jurisdictional discovery because the parties were unable to answer foundational questions with confidence regarding the alleged governing contract and this district’s relevance to the contractual relationship and the events underlying the dispute. ECF No. 38. Following the 90-day limited discovery period, Chubb Canada filed Defendant Chubb Insurance Company of Canada’s Renewed Motion to Dismiss Plaintiff’s Complaint and Master Drilling USA, LLC’s Cross Claim Pursuant to Fed. R. Civ. P. 12(b)(2) and Under the Doctrine of Forum Non Conveniens [ECF No. 46] on October 7, 2024.

Thereafter on October 21, 2024, Plaintiff filed its renewed response in opposition to dismissal [ECF No. 48] and Master Drilling USA filed its renewed response in opposition to dismissal of its cross-claim [ECF No. 49]. Chubb Canada then filed its reply in support of its motions to dismiss on October 28, 2024. ECF No. 50. The pending motions are thus fully briefed and ripe for review. II. RELEVANT FACTUAL ALLEGATIONS1 Plaintiff Gum Springs owns a Drilling Rig, identified as Global Shaft SD750-2 2019 (“Drilling Rig”). ECF No. 1-1, Compl. at ¶ 4. On July 18, 2019, Plaintiff and Defendant Master Drilling entered into an Equipment Purchase and Sale Agreement (“PSA”) in which Gum Springs agreed to sell the Drilling Rig to Master Drilling. Id. at ¶ 5. The Drilling Rig was located in Monongalia

County, West Virginia, and the PSA was negotiated and executed in Monongalia County, West Virginia. Id. at ¶ 6. The PSA required that Master Drilling maintain insurance on the Drilling Rig and name Gum Springs as an additional insured. Id. at ¶ 10. The PSA further

1 At the Motion to Dismiss phase, the Court assumes all well pled facts are true. However, the Court makes factual findings, based upon the preponderance of evidence, regarding this Court’s personal jurisdiction over Chubb Canada because the parties completed jurisdictional discovery. provided that the agreement would terminate if any payment was more than sixty days late and Master Drilling would then be required to return the Drilling Rig to Gum Springs “in like

condition.” Id. at ¶ 16. Master Drilling ultimately defaulted on the payments owed and returned the Drilling Rig to Gum Springs, in Morgantown, West Virginia. Id. at ¶¶ 17-18. Plaintiff alleges that Master Drilling did not return the Drilling Rig in “like condition”; rather, the Drilling Rig was extremely damaged and in deplorable condition upon its return. Id. at ¶ 19. Plaintiff alleges that it was named as an additional insured on an insurance policy Chubb Canada issued to Master Drilling, covering the Drilling Rig. See generally ECF No. 1-1; ECF No. 47 at p. 3. Plaintiff further asserts Chubb Canda acted in bad faith by failing to pay it insurance proceeds through the alleged insurance policy. Id. Master Drilling similarly filed a cross-

claim against Chubb Canada asserting it acted in bad faith and breached the insurance contract by not paying coverage to Master Drilling or Gum Springs. ECF No. 15. A. FACTS REGARDING JURISDICTION OVER CHUBB CANADA Chubb Canada is a Canadian insurance company located in Toronto, Ontario, and owned by Chubb Limited, a publicly listed company headquartered in Switzerland. ECF No. 1 at ¶ 8; ECF No. 1- 1 at ¶ 3. Chubb Canada is not a party to the PSA between Gum Springs and Master Drilling for the Drilling Rig. PSA, ECF No. 1- 1, Ex. A; ECF No. 46-2. Master Drilling first attempted to procure insurance for the Drilling Rig on November 12, 2019. ECF No. 46- 3. Robert Schumm, on behalf of Master Drilling, contacted Mark

Baines from Marsh Canada Limited (“Marsh Canada”), seeking $3,335,000.00 in coverage for the Drilling Rig. Id. Communications with Chubb Canada were handled by Marsh Canada on behalf of Master Drilling and Master Drilling relied on Marsh Canada to procure the subject Drilling Rig as an insured piece of equipment through Chubb Canada. ECF No. 46-6 at pp. 3, 11. The next day on November 13, 2019, Marsh Canada provided Master Drilling with the “Acord Property certificate evidencing the coverage.” ECF No. 46-3. On November 12, 2019, Baines contacted Jamie Park of Chubb Canada to secure insurance for the Drilling Rig, on behalf of Master Drilling, effective immediately. ECF No. 46-4. Alan Lee of Chubb Canada replied to Baines’s email and requested more

information about the equipment including pictures, invoices, a purchase order, and a description of its use, so Chubb Canada could proceed with the underwriting process. Id. After speaking with his “client,” Baines informed Chubb Canada on November 18, 2019, that Master Drilling would be using the Drilling Rig “to drill a water shaft at 13415 Fm Rd 449, Hallsville, Texas.” Id. Baines further provided that the Hallsville site was owned by Gum Springs Corporation and was manufactured by Global Shaft Drilling in Morgantown, West Virginia. Id. On November 25, 2019, Baines updated Chubb Canada that the Drilling Rig was heading to Avery Island, Louisiana. Id.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
Gum Springs Corporation v. Master Drilling USA, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gum-springs-corporation-v-master-drilling-usa-llc-wvnd-2025.