Anderson v. Burlington Ins. Co.

1

DERRICK ANDERSON, Plaintiff, v. BURLINGTON INSURANCE COMPANY, and Y S BAD INC. d/b/a SINFUL, Defendants.

No. 19-CV-297 (HKS)

United States District Court, W.D. New York

June 1, 2023

DECISION AND ORDER

H KENNETH SCHROEDER, JR. UNITED STATES MAGISTRATE JUDGE

The Honorable William M. Skretny referred this case to the undersigned for all pretrial matters pursuant to 28 U.S.C 636(b)(1)(A). Dkt. 8. The parties subsequently consented to the exercise of jurisdiction by a United States Magistrate Judge in accordance with the provisions of 28 U.S.C. § 636(c). Dkt. 12.

In a prior state court action (the “Underlying Action”), Plaintiff Derrick Anderson obtained a judgment against YS BAD Inc. d/b/a Sinful (“Sinful”) for negligent hiring, negligent training, and negligent supervision. See Dkt. 1-3 at 6-7. Pursuant to N.Y. Ins. Law § 3420(b), Plaintiff seeks to enforce that judgment against Sinful's insurer, Burlington Insurance Company (“Burlington”), alleging that it wrongfully disclaimed coverage to Sinful in the Underlying Action. See Dkt. 1-2, at 16. Burlington moved for summary judgment and to stay discovery. Dkts. 15, 17. For the following reasons, Burlington's motion for summary judgment is granted and its motion to stay discovery is denied as moot.

BACKGROUND

I. UNDERLYING ACTION

On March 14, 2014, Plaintiff commenced the Underlying Action in New York State Supreme Court, County of Erie, against the City of Buffalo, City of Buffalo Police Department, Police Officer Cedric Littlejohn, and an unknown police officer. See Dkt. 15-4. In his first cause of action, he alleged that the police officer defendants assaulted him and thus deprived him of his constitutional rights in violation of 42 U.S.C. § 1983 (“section 1983”):

10. Upon information and belief, while acting under color of law in their official capacity of police officers, the defendants, POLICE OFFICER CEDRIC LITTLEJOHN and JOHN DOE, deprived the plaintiff, DERRICK ANDERSON, of the privileges and immunities guaranteed to every citizen of the United States, including plaintiff, by the United States Constitution Amendments IV, V and Section 1 of Amendment XIV.

11. On or about the 26th day of January, 2013, at the premises of Sinful, located at 334 Delaware Avenue in the City of Buffalo, County of Erie, the State of New York, the defendant police officers named herein, acting in their official capacity as police officers, and pursuant to the authority granted to them, and while acting under color of state law, did willfully, maliciously, and intentionally assault and strike, without provocation, the plaintiff, DERRICK ANDERSON, causing serious injuries to said plaintiff, along with property loss.

12. Upon information and belief, the foregoing actions of the defendants constituted deprivation of the rights and privileges of the plaintiff, DERRICK ANDERSON, secured and protected to him by the Constitution and Laws of the United States. As a result of the aforesaid actions, the plaintiff, DERRICK ANDERSON, was unlawfully assaulted and unconstitutionally deprived of his liberty and otherwise tortiously and maliciously harmed by the actions of the defendants, in violation of Title 42 of the United States Code § 1983, et sec. ...

16. Upon information and belief, the acts of the defendants were willful, wanton and malicious and were done with the intent to injure plaintiff and deprive him of his civil rights.

Dkt. 15-4, at ¶¶ 10-12, 16. As a result of the incident, Plaintiff alleged that he “sustained bodily injuries and was painfully and seriously injured ....” Id. at ¶ 14. In his second cause of action, he alleged negligence claims against the City, police department, and police officers:

23. Upon information and belief, the incident hereinbefore described and the resultant injuries were caused as a result of the negligent, careless, reckless and/or unlawful conduct on the part of the agents, servants and/or employees of the defendants, CITY OF BUFFALO, CITY OF BUFFALO POLICE DEPARTMENT, POLICE OFFICER CEDRIC LITTLEJOHN and/or JOHN DOE, and more particularly, among other things: in failing and omitting to ensure its police officers used appropriate care and discretion; in failing and omitting to properly and adequately instruct, supervise and train its police officers; in negligently striking the plaintiff, without just cause or provocation; and in negligently hiring, POLICE OFFICER CEDRIC LITTLEJOHN and JOHN DOE.

Dkt. 15-4, at ¶ 23.

On June 11, 2015, Plaintiff filed an amended complaint, which realleged the above claims against the original defendants. See Dkt. 15-5, at ¶¶ 13-24. Plaintiff also named Sinful, the operator of the nightclub, and 120 W. Tupper Street, Inc., the premises owner, as Defendants to assert negligence claims against them. See Dkt. 15 5. As to Sinful, he alleged:

34. Upon information and belief, on or about the 26th day of January, 2013, the plaintiff, DERRICK ANDERSON, was caused to sustain serious injuries due to the negligence of the agents, servants and/or employees of the defendants, 120 W. TUPPER STREET, INC. and YS BAD, INC. d/b/a SINFUL.

35. Upon information and belief, the incident hereinbefore described and the resultant injuries were caused as a result of the negligence, carelessness, recklessness and/or unlawful conduct on the part of the defendants 120 W. TUPPER STREET, INC. and YS BAD, INC. d/b/a SINFUL, by their agents, servants and/or employees in the ownership, operation, maintenance, management and control of the aforesaid premises and, among other things, said negligence of the defendants, by their agents, servants and/or employees was exhibited in defendants failing to exercise proper control on its premises; in failing to exercise proper supervision on its premises; in failing to exercise good judgment; in intentionally assaulting and striking, without provocation, the plaintiff; in failing to properly train their agents, servants and/or employees and in failing and omitting to exercise due and reasonable care to avoid the incident.

Id. at ¶¶ 34, 35. On January 10, 2018, Plaintiff's action against 120 W. Tupper was discontinued and withdrawn. See Dkt. 15-6; Dkt. 18-7, at ¶ 9.

On February 16, 2018, the court granted the City of Buffalo and defendant police officers' motion for judgment “upon the ground that the plaintiff . . . failed to prove the allegations of his complaint,” and dismissed the complaint against these defendants. Dkt. 15-7, at 1-2. The court granted Plaintiff's motion for judgment as a matter of law on its cause of action against Sinful “involving negligent hiring, negligent supervision, and negligent training,” as Sinful “failed to provide a legally sufficient defense, or any rebuttal of the injuries evidenced by Plaintiff.”^[1] Dkt. 15-9, at 1. And on March 6, 2018, the court entered judgment against Sinful in the amount of $250,000 for past pain and suffering, $1,320.23 for medical expenses incurred, $7,398.90 for property losses incurred, and $250,000 for punitive damages. Id. at 2.

II. BURLINGTON POLICY AND COVERAGE DISPUTE

Burlington issued Sinful a Commercial General Policy (the “Burlington Policy”), effective November 23, 2012 through November 23, 2013. See Dkt. 15-3, at 3. Relevant here, the Burlington Policy contains an exclusion for bodily injury or property damage arising out of assault, battery, or other physical altercation (the “Assault and Battery Exclusion”):

D. This insurance does not apply to:

a. Assault, Battery Or Other Physical Altercation^[2]

“Bodily injury” or “property damage”:

(1) Expected or intended from the standpoint of any insured.

(2) Arising in whole or in part out of any “assault” or “battery” committed or attempted by any person.

(3) Arising in whole or in part out of any act or omission in connection with avoiding, preventing, suppressing or halting any actual or threatened “assault” or “battery.”

(4) Arising in whole or in part out of any actual or threatened verbal or physical contraction or altercation committed or act or omission in connection with avoiding, preventing, suppressing or halting any actual or threatened verbal or physical confrontation or altercation.^[3]

Dkt. 15-3, at 45. The Assault and Battery Exclusion also explicitly provides that the Exclusion applies to all theories of liability asserted against any insured:

G. The exclusions added in paragraphs D, E, and F of this endorsement apply to all acts or omission, including any act or omission in responding to or failing to respond or render aid, medical or otherwise, to any victim of the "assault" or "battery" or physical confrontation or altercation, and all theories of liability (direct or vicarious) asserted against any insured, including but not limited to all theories of negligence, gross negligence, recklessness or intentional tort and shall not be subject to any severability or separation of insureds provision in the policy.

Id. The Burlington Policy also contains the following exclusion for punitive damages (the “Punitive Damages Exclusion”):

I. This insurance does not apply to:

Punitive Damages

Any claim or indemnification for punitive or exemplary damage. If a “suit” seeking both compensatory and punitive or exemplary damages has been brought against you for a claim covered by this policy, we will provide defense for such action. We will not have any obligation to pay for any fees, including but not limited to attorneys' fees, costs, interest or damages attributable to punitive or exemplary damages.

Id. at 14.

The underlying incident at the Sinful nightclub allegedly occurred on January 26, 2013. Dkt. 15-2, at ¶ 15; Dkt 18-7, at ¶ 15. Plaintiff filed a Notice of Claim against the City of Buffalo and the Buffalo Police Department on April 25, 2013. Dkt. 1-2, at ¶ 14. On ...