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Kras v. Conifer Insurance Co.

United States District Court, N.D. Indiana, Hammond Division

January 6, 2017

NATHAN KRAS, Plaintiff/Judgment Creditor,
v.
CONIFER INSURANCE COMPANY, Garnishee-Defendant, CONIFER INSURANCE COMPANY, Counter Claimant,
v.
NATHAN KRAS, Counter Defendant.

          OPINION AND ORDER

          JOHN E. MARTIN MAGISTRATE JUDGE

         This matter is before the Court on a Motion to Reconsider and Alternative Motion to Certify Question to the Indiana Supreme Court [DE 35], filed by Plaintiff Nathan Kras on November 30, 2016. Kras asks the Court to reconsider its Opinion and Order of November 23, 2016 [DE 33], or in the alternative to certify a relevant insurance law question to the Indiana Supreme Court.

         Garnishee-Defendant Conifer Insurance Company has responded, urging the Court not to reconsider its November 23 Opinion and Order and not to certify any question to the Indiana Supreme Court. Kras has not replied, and the time to do so has passed.

         I. Background

         In September 2013, Nathan Kras was shot in the leg and abdomen outside a Hammond, Indiana nightclub. Two years later, in September 2015, Kras sued the nightclub and its owners in state court, alleging negligence. The nightclub owners had insurance with Conifer Insurance Company, but Conifer denied the nightclub owners' request for coverage for the attack. In Conifer's view, the policy provided coverage for the nightclub property only, not for the adjoining gravel parking lot where Conifer said the attack occurred.

         The state court litigation proceeded without Conifer's involvement. In March 2016, Kras served 28 admissions requests on the nightclub owners-the Court will refer to them as the insureds-regarding the nature, extent, and amount of Kras's injuries and damages, the location of the attack, and the insureds' fault with respect to the attack. The insureds fairly quickly agreed to a consent judgment by which they admitted negligence and admitted to all 28 admissions requests. The state court entered judgment against the insureds for $2, 955, 056-the amount of damages identified in the consent judgment and in the admissions requests.

         Having received judgment in his favor, in April 2016 Kras filed a motion for a proceeding supplemental. Kras sought to garnish $2, 955, 056 from Conifer in satisfaction of the state court judgment against the insureds. Conifer removed the case to federal court.

         On July 20, 2016, Kras filed a motion for summary judgment. At the time, neither party had conducted any discovery. But two days later, on July 22, 2016, Conifer served interrogatories and document production requests on Kras.

         Conifer then sought to extend its deadline for responding to Kras's summary judgment motion until 30 days after the completion of discovery and the resolution of any discovery disputes. See Fed. R. Civ. P. 56(d) (“If a nonmovant shows [that] it cannot present facts essential to justify its opposition [to summary judgment], the court may: (1) defer considering the motion or deny it; (2) allow time . . . to take discovery; or (3) issue any other appropriate order.”).

         The Court granted Conifer's motion and stayed Conifer's summary judgment response deadline until 30 days after the close of discovery or the resolution of any discovery disputes, whichever comes later. See DE 33. The Court held that the state court judgment did not necessarily resolve that the attack on Kras occurred on the insureds' property. The state court complaint was drafted in a way that invited a verdict in Kras's favor even if the attack occurred on the portion of the nightclub's parking area that Conifer says is not owned by the insureds, and the state court judgment did not include any factual findings on the issue. So because the Court found that the precise location of the attack was not “necessarily resolved” by the state court judgment, the Court ruled that Conifer is entitled to discovery on the issue of the attack's location.

         Kras argued that the attack's location had been established as a matter of law by virtue of the insureds' failure to respond to Kras's state court admissions requests, in which Kras had asked the insureds to admit that Kras was attacked on the insureds' premises. The insureds' failure to answer, Kras argued, meant that that fact was admitted and therefore conclusively established.

         The Court agreed that, in general, failing to respond to requests for admission causes those matters to be admitted and conclusively established by law. Indiana Trial Rule 36; Henrichs v. Pivarnik, 588 N.E.2d 537, 543 (Ind.Ct.App. 1992). But the Court disagreed that the insureds' failure to respond to Kras's admissions requests meant that the attack's location was conclusively established for the purpose of this proceeding supplemental against Conifer:

[W]hile the failure to respond to the requests for admission may have bound the insureds going forward, Kras has not cited-and the Court has not found-authority supporting the proposition that the failure to respond binds Conifer or overrules the collateral estoppel analysis described [earlier in the Court's Opinion and Order]. An insurer that abandons its insured as Conifer did here will be bound to issues necessarily determined in the underlying litigation, and as the Court has explained the question of the attack's precise location was not necessarily determined.

DE 33 at 11. So the Court granted Conifer's motion and stayed Conifer's summary judgment response deadline until 30 days after the close of discovery or the resolution of any discovery ...


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