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ARAC Roof It Forward v. Nationwide Mutual Insurance Company of America

United States District Court, S.D. Indiana, Indianapolis Division

June 5, 2019

ARAC Roof It Forward, Plaintiff,
v.
Nationwide Mutual Insurance Company of America, Defendant.

          ENTRY

          Hon. Jane Magnus-Stinson, Chief Judge

         The Chief Executive Officer (“CEO”) of Nationwide Mutual Insurance Company of America (“Nationwide”) does not want to attend a settlement conference scheduled in this defamation matter on June 27, 2019. On April 8, 2019, Nationwide filed a Motion to Excuse its Chief Executive Officer from the Second Settlement Conference (“Motion to Excuse”), [Filing No. 76], which the Magistrate Judge denied on May 15, 2019, [Filing No. 78]. On May 28, 2019, Nationwide objected to the Magistrate Judge's Order in its Appeal of the Magistrate Judge's Order Denying Nationwide's Motion to Excuse Its Chief Executive Officer from the Second Settlement Conference (“Objection”), [Filing No. 81]. For the reasons set forth below, the Court OVERRULES Nationwide's Objection, [81].

         I.

         Legal Standard

          Review of a magistrate judge's decision on a nondispositive motion is deferential, and the Court may sustain an objection to such an order only where it is “clearly erroneous or is contrary to law.” Fed.R.Civ.P. 72(a); 28 U.S.C. § 636(b)(1)(A). An order is clearly erroneous “only if the district court is left with the definite and firm conviction that a mistake has been made.” Weeks v. Samsung Heavy Indus. Co., Ltd., 126 F.3d 926, 943 (7th Cir. 1997). “An order is contrary to law when it fails to apply or misapplies relevant statutes, case law, or rules of procedure.” Pain Center of SE Ind., LLC v. Origin Healthcare Solutions, LLC, 2014 WL 6674757, *2 (S.D. Ind. 2014) (citations and quotation marks omitted).

         II.

         Background

         On December 1, 2017, ARAC Roof It Forward (“ARAC”) filed this lawsuit against Nationwide asserting claims related to allegedly defamatory statements Nationwide made about ARAC to Nationwide's insureds during the investigation of two separate insurance claims. [See Filing No. 1; Filing No. 9.] On February 9, 2018, the Magistrate Judge scheduled a settlement conference in this matter, directing that each party be represented by a client representative “with complete authority to negotiate and communicate a settlement” and that, “unless excused by written order of the court, . . . an officer . . . of every corporate entity that is a party[] shall attend the settlement conference.” [Filing No. 26 at 1-2.] On August 15, 2018, Nationwide sought leave from the officer attendance requirement, [Filing No. 44], which was granted to the extent that the CEO or Chief Financial Officer (“CFO”) “must be available by telephone . . . in the event their participation in the conference is deemed necessary by the Magistrate Judge.” [Filing No. 45 at 2].

         The first, pre-summary judgment settlement conference was held before the Magistrate Judge on September 21, 2018. [Filing No. 47.] After the settlement conference proved unsuccessful, the Magistrate Judge scheduled a second settlement conference for June 27, 2019, directing that “unless excused by written order of the court, the chief executive officer of each of the parties shall appear in person for the settlement conference.” [Filing No. 47 at 1-2.] The Magistrate Judge also ordered that, prior to October 5, 2018, the parties must confirm that the required representatives would be attending the second settlement conference. [Filing No. 47 at 4.] Nationwide failed to confirm that its CEO would be attending the second settlement conference. [Filing No. 48 at 1.]

         On February 2, 2019, the Magistrate Judge issued a minute entry reminding the parties that a second, post-summary judgment settlement conference is scheduled for June 27, 2019. [Filing No. 71 at 1.] The Magistrate Judge stated that:

[t]he parties' CEOs were ordered to attend the second settlement conference primarily because [Nationwide] refused to make any offer during the first settlement conference, despite [Nationwide's] counsel's acknowledgement that a complete disposition of this matter on summary judgment was unlikely. It was the belief of the undersigned Magistrate Judge, based upon [Nationwide's] behavior during the settlement conference, that [Nationwide's] representative had predetermined [Nationwide's] settlement position and was unwilling to even consider the risks inherent in a jury trial. Therefore, it is the belief of the undersigned Magistrate Judge that a second settlement conference would be futile without the presence of a high level member of [Nationwide's] management, which is why the court ordered both parties' CEOs to attend. It is not the Court's intent to force either party to settle, only to bring together representatives of the parties with an open mind who are willing to consider the risks of this matter proceeding to trial.

[Filing No. 71 at 1.]

         On April 8, 2019, Nationwide moved for relief from the requirement that its CEO appear at the second settlement conference. [Filing No. 76.] Nationwide requested that its Managing Counsel, Tony Damelio-who was the representative at the first settlement conference-attend the second settlement conference in place of the CEO. [Filing No. 76 at 4.] Nationwide argued that although Mr. Damelio did not make any settlement offers at the first settlement conference, Nationwide later authorized a settlement offer of $5, 000 in December 2018. [Filing No. 76 at 3-4.] Nationwide argued that Mr. Damelio has the authority to settle the matter, is the person from Nationwide who is most informed of the facts, strengths, and weaknesses of the case, and has the open mind and ability to evaluate the risks of proceeding to trial. [Filing No. 76 at 4.] Nationwide also argued that its CEO should not have to attend because this case is not factually or legally complex and the damages involved are only “presumed” damages that do not amount to millions of dollars. [Filing No. 76 at 4.]

         On May 14, 2019, the Magistrate Judge denied Nationwide's motion to excuse the CEO. [Filing No. 78.] The Magistrate Judge noted that “[t]he Court scheduled the second settlement conference so far in advance to provide the chief executive officers of the parties sufficient lead time to ensure their availability for the second settlement conference.” [Filing No. 78 at 1, n. 2.] The Magistrate Judge also noted that the second settlement conference was scheduled immediately following the first settlement conference, when Mr. Damelio's “statements and actions were fresh in the Magistrate Judge's mind, and not based upon a possibly faded recollection months later.” [Filing No. 78 at 3.] The Magistrate Judge addressed Nationwide's apparent argument that the damages were not sufficient to justify the presence of the CEO, and noted that ARAC's latest demand was nearly one million dollars. [Filing No. 78 at 3.] Finally, the Magistrate Judge noted that ...


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