Crooks v. State Farm Mut. Auto. Ins. Co.

MICHAEL D. CROOKS, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, et.al, Defendants.

Case No. 2:15-cv-2234

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF OHIO EASTERN DIVISION

August 17, 2016

Chief Judge Edmund A. Sargus, Jr.

Magistrate Judge Elizabeth Preston Deavers

OPINION AND ORDER

This matter is before the Court on the Motions for Summary Judgment of Defendants State Farm Mutual Automobile Insurance Company ("State Farm") (ECF No. 32), and Allstate Property and Casualty Insurance Company ("Allstate") (ECF No. 33). Plaintiff opposes these motions (ECF Nos. 35, 36), and also moves to amend his Complaint (ECF No. 37). For the reasons that follow, Defendants' Motions for Summary Judgment are GRANTED. Plaintiff's motion for leave to file an amended Complaint is DENIED as futile.

I. BACKGROUND

On April 15, 2015, Plaintiff Michael D. Crooks ("Crooks" or "Plaintiff") filed this action in state court against State Farm and Allstate, asserting a number of state law claims. Plaintiff is a citizen of Ohio. Defendants State Farm and Allstate are both Illinois corporations with their principal places of business in Illinois. Defendants removed the action to this Court on the basis of diversity jurisdiction. This action is related to a lawsuit Plaintiff filed on July 28, 2009, in the Court of Common Pleas in Monroe County, Ohio, Michael D. Crooks v. Darlene M. Palmer, Monroe County Court of Common Pleas, Case No. 09-cvc-200 (the "Injury Case").

The Injury Case arose out of a July 31, 2007 motor vehicle accident involving Plaintiff and Ms. Palmer. Allstate was Ms. Palmer's liability insurer, and State Farm was Plaintiff's underinsured motorist carrier ("UIM"). Ms. Palmer and Allstate did not contest liability for the accident, but the parties litigated the amount of damages. Prior to trial in the Injury Case, State Farm paid $13,796.69 in medical bills to or on behalf of Plaintiff under the medical payments coverage provision of his policy for medical treatment that occurred from February 2008 until May 2009. Pursuant to an agreement approved and entered by the court, Plaintiff agreed to dismiss his claim for uninsured/underinsured motorist coverage against State Farm, and State Farm agreed to dismiss its cross-claims for subrogation against Ms. Palmer and Allstate, without prejudice to refiling. (Judgment Entry, ECF No. 31-2, Exh. 2 at 1.) State Farm also agreed to pay UIM according to the terms of its policy in the event a jury verdict exceeded the limits of Ms. Palmer's coverage, and agreed to accept in full payment of its right to subrogation, "2/3 of the amount of the jury's determination, up to 2/3s of the total amount of medical payments made by State Farm through the date of the verdict." (Id.) As part of the agreement between Plaintiff and State Farm memorialized in the Judgment Entry, Plaintiff waived any claim to pre-judgment interest up to the date of final judgment, "as the contractual right to underinsured motorist coverage has not accrued prior to that date." (Id.) Accordingly, the Court dismissed State Farm from the Injury Case.

In October 2011, the Injury Case went to trial on the issue of damages only. The jury returned a verdict in favor of Plaintiff in the amount of $355,941.50. (Judgment Entry, ECF No. 31-3, Exh. 3 at p. 1.) Specifically, the jury awarded Plaintiff $18,035.93 for past medical expenses; $106,208.00 for future medical expenses; $201,697.57 for past pain and suffering;$25,000.00 for future pain and suffering; and $5,000.00 for Plaintiff's past inability to perform normal activities. (Id.)

Allstate defended its insured, Ms. Palmer at trial in the Injury Case. After receiving the jury's verdict, Plaintiff calculated "he had a potential judgment against [Ms. Palmer] in the amount of . . . $338,117.15." (Satisfaction of Judgment and Release of all Claims, Judgment Entry, ECF No. 31-4, Exh. 4 at p. 2.) Although Allstate was only contractually liable to pay the policy limit of $25,000, Allstate "made a decision to pay all or a portion of the potential total judgment against [Ms. Palmer] despite not being contractually obligated," and paid the Plaintiff $320,000 on behalf of Ms. Palmer in full and final satisfaction of all claims. (Id.)

The Satisfaction of Judgment and Release of All Claims between Crooks, his heirs, executors, or administrators ("Releasors") and Ms. Palmer, Allstate, and its agents ("Releasees"), was entered on March 30, 2012, and provides in pertinent part:

Releasors understands [sic] the Court has discretion concerning prejudgment interest and this compromised settlement of judgment and release covers all injuries, damages and losses determined by the jury as well as pre- and post-judgment.

The amount stated herein is the consideration for this Satisfaction of Judgment and Release of All Claims and Releasors voluntarily accept said sum for the purpose of making a full and final compromise of the potential judgment.

This is a complete satisfaction of all claims, and there are no written or oral understandings or agreements, directly or indirectly with this release or compromise of potential judgment that are not incorporated herein.

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This Satisfaction of Judgment and Release of All Claims, duly executed by such attorney on behalf of Releasors and by such attorney(s) on behalf of Releasees dismissing the Action at Case No. 2009-200 against the Releasees with prejudice. Releasors hereby acknowledge and confirm he has authorized and directed his attorney to execute and file said Satisfaction of Judgment and Release of All Claims on his behalf.

This agreement shall be binding upon and inure to the benefit of the Releasors and Releasees.

(Satisfaction of Judgment and Release of all Claims, Judgment Entry, ECF No. 31-4, Exh. 4 at pp. 2-3.)

As part of the final post-trial settlement, State Farm paid Plaintiff $76,029, representing all of the applicable UIM coverage (the $100,000 UIM limit less the $25,000 limit of Ms. Palmer's Allstate liability policy, as well as post-judgment interest), and waived any right to subrogation for the payments made under Plaintiff's medical payment coverage. (Satisfaction of Judgment and Release of all Claims, Judgment Entry, ECF No. 31-4, Exh. 4 at pp. 1-2.) State Farm also paid an additional $2,898.85 based upon the jury's verdict, representing the additional medical expenses payable under the medical coverage provisions of Plaintiff's policy. (Stip. of Facts, ECF No. 31, ¶ 8.) Thus, Plaintiff's total recovery was $398,928.01.

Plaintiff brought suit in the case sub judice against both Allstate and Allstate insurance adjuster Ferooz Aziz, and against State Farm, State Farm insurance adjuster Keisha Ratkiska, and State Farm employees John Doe 1 through 5, alleging various tort and contract claims based on the alleged conduct of the insurance companies in the administration of the insurance policies prior to the trial in the Injury Case. Plaintiff also made various allegations directed towards the interactions of the insurance companies and their adjusters. Plaintiff's Complaint alleged, based on information and belief, that Allstate and Allstate adjuster Aziz had sufficient information to offer Ms. Palmer's "liability policy limits of $25,000 prior to forcing Plaintiff to file a lawsuit." (Compl., ECF No. 4, at p. 5, ¶ 17.) Plaintiff's Complaint further alleged, based on information and belief, that State Farm, State Farm adjuster Ratkiska and/or State Farm John Doe employees had sufficient information "to pay the policy limits of Plaintiff's medical payment coverage and underinsurance coverage prior to forcing Plaintiff to prepared [sic] for and go to trial in andaround October 24, 2011." (Compl., ECF No. 4, at p. 5, ¶ 18.) Plaintiff also alleged, based on information and belief, that "Allstate and Defendant Aziz ignored evidence of Plaintiff's injury, evaluated the Plaintiff's claims with a prejudice towards Allstate, evaluated the Plaintiff's claim as resolving within four months of the accident and retained a medical doctor, Dr. Joseph Schlonsky, to give opinion testimony consistent with its' [sic] general business practice." (Compl., ECF No. 4, at p. 5-6, ¶ 20.) In his breach of contract claim (Count Two) Plaintiff alleged that State Farm, State Farm adjuster Ratkiska, and/or State Farm John Doe Employees wrongfully adopted Allstate and/or Allstate adjuster Aziz's "theory that Plaintiffs injuries, damages and losses resolved/ceased to exist within four months of the accident after it/they [Allstate and its adjuster and employees] determined the Plaintiff's injuries, damages and losses existed/continued until at least May 6, 2009." (Compl., ECF No. 4, at p. 8-9, ¶ 31.) Ultimately, on July 2, 2015, the parties stipulated that adjusters Aziz and Ratkiska should be dismissed as party defendants, and they were dismissed from the case. (Stip. of Dismissal, ECF No. 20.)

On February 25, 2015, the parties filed a joint Stipulation of Facts (ECF No. 31) setting forth the chronology and facts of their actions and agreements in the settling of the underlying Injury Case.¹ In pertinent part, the Stipulation of Facts provides the following:

4. At the time of the July 31, 2007 accident, Crooks was insured by State Farm Mutual Automobile Insurance Company under policy 5987-664-35L. The policy contained medical payments coverage with a $50,000 limit and underinsured motorist ("UIM") coverage with limits of $100,000 for each person and $300,000 for each accident. Before the trial of the prior lawsuit, State Farm paid $13,796.69 to or on behalf of the Plaintiffunder the medical payments coverage of his State Farm policy for Crook's medical treatment that occurred from February 2008 until May 5, 2009. State Farm's medical payments payment was based on its own determination.

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8. In November 2011, State Farm issued an additional Medical Payments coverage check to Plaintiff in the amount of $2,898.85. This amount represented the medical expenses

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