Henkels and McCoy, Inc. v. United Specialty Insurance Company

Opinion

Case 2:21-cv-07210-RSWL-RAO Document 43 Filed 03/14/23 Page 1 of 5 Page ID #:1153

1 'O' 2 3 4 5 6 7 CV 21-7210-RSWL-RAO x HENKELS AND MCCOY, INC. et al., ORDER re: Defendant’s Motion to Plaintiff, Vacate Order on Motion for Partial Summary Judgment v. [38] COMPANY, Defendant. Plaintiff Henkels and McCoy, Inc. (“Plaintiff”) initiated this Action against Defendant United Specialty Insurance Company (“Defendant”) for breach of contract, declaratory relief, and breach of the duty of good faith and fair dealing. Compl., ECF No. 1. Currently before the Court is Defendant’s Motion to Vacate Order on Motion for Partial Summary Judgment [38] (the “Motion”). In the Motion, Plaintiff indicates that the parties have settled, the current Motion is unopposed, and the 1 Case 2:21-cv-07210-RSWL-RAO Document 43 Filed 03/14/23 Page 2 of 5 Page ID #:1154

1 Court’s prior Order regarding the earlier Motion for

2 Partial Summary Judgment (“MPSJ”) should be vacated.

3 Having reviewed all papers submitted pertaining to 4 the Motion, the Court NOW FINDS AND RULES AS FOLLOWS: 5 the Court DENIES Defendant’s Motion. 7 A. Factual Background 8 The Complaint alleges: 9 Plaintiff is incorporated in Pennsylvania, has its principal place of business in Pennsylvania, and does business in the State of California, County of Los Angeles. Compl. ¶ 1, ECF No. 1. Defendant is incorporated in Delaware, has its principal place of business in Bedford, Texas, and does business in the State of California, County of Los Angeles. Id. ¶ 3. Plaintiff was hired to replace a utility pole in San Gabriel, California. Id. ¶ 16. Plaintiff hired a traffic and control services company to assist in the replacement of the pole. Id. ¶ 17. Plaintiff’s contract with the traffic and control services company required the company to buy insurance that covered Plaintiff from liability while replacing the pole. Id. ¶¶ 25-26. The traffic and control services company bought insurance from Defendant which covered Plaintiff during the pole replacement work. Id. ¶¶ 27-28. An accident occurred at the intersection where Plaintiff was replacing the pole. Id. ¶ 20. Plaintiff was sued and settled with the parties injured at the 2 Case 2:21-cv-07210-RSWL-RAO Document 43 Filed 03/14/23 Page 3 of 5 Page ID #:1155

1 intersection. Id. ¶ 46. Defendant refused to defend or

2 indemnify Plaintiff at any point during the prior

3 lawsuit. Id. ¶ 49. As a result of Defendant’s breach 4 of contract to defend and indemnify Plaintiff, Plaintiff 5 suffered actual damages. Id. ¶ 50. 6 B. Procedural Background 7 On September 8, 2021, Plaintiff filed its Complaint 8 [1]. On September 2, 2022, Plaintiff filed a MPSJ [21]. 9 On November 14, 2022, the Court granted Plaintiff’s MPSJ [27]. On December 12, 2022, Plaintiff filed a notice of a conditional settlement [33]. On February 13, 2023, Defendant filed the instant Motion [38]. A. Legal Standard Pursuant to Federal Rule Civil Procedure (“Rule”) 60(b), a district court may “relieve a party or a party’s legal representative from a final judgment, order, or proceeding” for several reasons. In determining whether to vacate a judgment, district courts must consider “the consequences and attendant hardships of dismissal or refusal to dismiss” and “the competing values of finality of judgment and right to relitigation of unreviewed disputes.” American Games, Inc. v. Trade Products, Inc., 142 F.3d 1164, 1168 (9th Cir. 1998) (quoting Dilley v. Gunn, 64 F.3d 1365, 1370-71 (9th Cir. 1995)). Courts are not mandated to vacate a prior order at 3 Case 2:21-cv-07210-RSWL-RAO Document 43 Filed 03/14/23 Page 4 of 5 Page ID #:1156

1 the behest of the parties to facilitate settlement. See

2 Bates v. Union Oil Co., 944 F.2d 647, 650 (9th Cir.

3 1991). The Ninth Circuit has recognized that if courts 4 were required to vacate prior rulings after settlement 5 “any litigant dissatisfied with a trial court’s findings 6 would be able to have them wiped from the books.” 7 Ringsby Truck Lines, Inc. v. Western Conference of 8 Teamsters, 686 F.2d 720, 721 (9th Cir. 1982). 9 B. Discussion Defendant argues that given the Court’s prior MPSJ Order was “based on the specific factual circumstances of this case” and that the Court did not adopt any “unique or novel legal issues,” that the Court should vacate the Order. Mot. at 6:1-6. Even when parties stipulate to an order regarding a motion for summary judgment to be vacated, courts typically do not vacate their particular orders. See, e.g., POLAR-Mohr Maschinenvertriebsgesellschaft GmbH & Co. KG v. Zurich Am. Ins. Co., No. 17-cv-01804-WHO, 2018 U.S. Dist. LEXIS 231990, at *1 (N.D. Cal. May 11, 2018); Reynolds v. Allstate Ins. Co., No. C 10-4893 SI, 2012 U.S. Dist. LEXIS 144695, at *4-5 (N.D. Cal. Oct. 4, 2012). “Judicial precedents are presumptively correct and valuable to the legal community as a whole. They are not merely the property of private litigants and should stand unless a court concludes that the public interest would be served by a vacatur.” Izumi Seimitsu Kogyo Kabushiki Kaisha v. U.S. Philips Corp., 510 U.S. 4 Case 2:21-cv-07210-RSWL-RAO Document 43 Filed 03/14/23 Page 5 of 5 Page ID #:1157

1 27, 40 (1993). 2 Here, as it relates to the public interest,

3 Defendant offered no reasons for why the Court should 4 vacate its prior MPSJ Order. See Zinus, Inc. v. Simmons 5 Bedding Co., No. C 07-3012 PVT, 2008 U.S. Dist. LEXIS 6 33359, at *6 (N.D. Cal. Apr. 23, 2008) (“The public paid 7 for this use of court resources through its tax dollars. 8 Vacatur would render that expenditure a waste, and the 9 parties cite no public interest that would be served by vacatur [of the court’s order] which would justify the waste of public funds.”). For the foregoing reasons, the instant Motion to vacate the Court’s prior MPSJ Order is DENIED. Based on the foregoing, the Court DENIES Defendant’s Motion to Vacate Order on Motion for Partial Summary Judgment. DATED: March 14, 2023 /s/Ronald S.W. Lew HONORABLE RONALD S.W. LEW Senior U.S. District Judge 5