Grasis v. Win Access, Inc., CIV. NO.: 13-1226 (PAD/SCC)

LINDSEY GRASIS; DOROTHY GRASIS; MICHAEL GRASIS, Plaintiff, v. WIN ACCESS, INC.; CONSEJO DE TITULARES DEL CONDOMINIO ASHFORD IMPERIAL; ET AL., Defendant.

CIV. NO.: 13-1226 (PAD/SCC)

UNITED STATES COURT FOR THE DISTRICT OF PUERTO RICO

March 17, 2017

REPORT AND RECOMMENDATION

Co-defendant WIN Access, Inc. ("WIN") was in charge of providing security to Ashford Imperial Condominium during the time that Lindsey Grasis was raped on the roof of the building. Cooperativa de Seguros Múltiples ("Cooperativa"), was WIN's insurer. Cooperativa filed two motions for summary judgment. Docket Nos. 326, 327 and 347. For the reasons set forth herein, we recommend that they be granted in part and denied in part.

I. Factual Background

Lindsey Grasis was a 20-year-old student of Worcester Polytechnic Institute ("WPI") participating in a study- abroad program in Puerto Rico. This action arises from the rape of Lindsey on April 14, 2012, at the Ashford Imperial Condominium, where she was residing as part of the program. The aggressor was William Rodríguez, who was found guilty in a Court of the Commonwealth of Puerto Rico of aggravated sexual assault and sentenced to twenty years of imprisonment. Rodríguez was an employee of WIN, a security agency hired by Consejo de Titulares of the Ashford Imperial Condominium, to provide security services. On the day of the events Rodríguez was stationed in the lobby of the condominium and convinced Lindsey to accompany him to the rooftop of the 26-story-high Ashford Imperial Condominium, where he raped her against the railing. Lindsey and her parents seek damages for their pain and suffering as a result of the rape.

II. Procedural Background

I will recount only the facts pertinent to the motions for summary judgment now before the court. In the original com- plaint, plaintiffs Michael, Dorothy and Lindsey Grasis claimed damages against defendants Consejo de Titulares Condominio Ashford Imperial, ("Consejo"), WIN, and Sea Breeze Apt. Rentals, Inc., ("Sea Breeze"). After WIN filed a Third Party Complaint against Cooperativa, Docket No. 36, plaintiffs amended the complaint to include Cooperativa, as WIN's insurer. Docket. 46. Thereafter, Consejo filed cross claims against WIN and Cooperativa, Docket Nos. 73 and 113.

Cooperativa filed a motion for summary judgment and memorandum of law alleging that the policy issued to WIN does not provide coverage for the incident that gave rise to this case. Docket Nos. 326 and 327. Cooperativa sought dismissal of all the claims against it made in the Second Amended Complaint, the Third Party Complaint, and the Cross-Claim. Id. Cooperativa later filed a Second Motion for Summary Judgment. Docket No. 347. Consejo and plaintiffs opposed. Docket Nos. 350 and 353. Cooperativa replied. Docket No. 369.

On August 29, 2016, Cooperativa supplemented its first motion for summary judgment with new evidence. Docket No. 361. On that same day, Cooperativa filed a motion under Rule 59(e) to complement and substitute certain exhibits included in its First Motion for Summary Judgment. Docket No. 363. Plaintiffs filed an opposition to Cooperativa's motions at Docket Nos. 361 and 363. Docket No. 367. The Court advised Cooperativa that it would consider the evidence as part of its analysis of the motions for summary judgment. Docket Nos. 395 and 396.

I will review each pending motion, opposition thereto, any supplemental motion and statement of uncontested facts as to each, ("SUF"), and make a recommendation as to the disposition of each.

III. Standard

Summary judgment may be granted when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)(If a party "fails to make a showing sufficient to establish the existence of an element essential to the party's case, and on which that party will bear the burden of proof at trial," summary judgment is proper.) The court must examine the record in the light most favorable to the nonmovant and indulging all reasonable inferences in the nonmovant's favor. Maldonado-Denis v. Castillo-Rodríguez, 23 F.3d 576, 581 (1st Cir. 1994).

In its review of the record, the court must refrain from engaging in an assessment of credibility or weigh the evidence presented. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 150 (2000)(quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986))("Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge.").

Finally, as this is a diversity case, the court is bound to apply Puerto Rico law to all substantive matters. Vázquez-Filipetti v. Banco Popular, 504 F.3d 43, 48 (1st Cir. 2007).

IV. Factual Findings

The following factual findings are taken from the parties' SUF's and supporting documentation. The Court made some previous findings of fact in its Report and Recommendation at Docket No. 387, which shall be incorporated by reference here. The Court makes the following additional findings of fact, specific to the claims made by Cooperativa in its two motions for summary judgment:

Cooperativa's Policy

1.Cooperativa issued a "Commercial General Liability" insurance policy to WIN. See Policy and Endorsements, Docket Nos. 363-5.

2. The policy covered the period from March 11, 2012, until March 11, 2013. See Policy and Endorsements, Docket No. 363-5, at pg. 5.

3. The policy includes an abuse and molestation exclusion, which states:

ABUSE AND MOLESTATION EXCLUSION

[...]

This insurance does not apply to "bodily injury,""property damage" or "personal and advertising injury" arising out of:

1. The actual or threatened abuse or molestation by anyone of any person while in the care, custody or control of the insured, or

2. The negligent:

a. Employment;

b. Investigation;

c. Supervision;

d. Reporting to the proper authorities, or failure to so report; or

e. Retention; of a person for whom any insured is or ever was legally responsible and whose conduct would be excluded by Paragraph 1. above.

See Policy and Endorsements, Docket No. 363-8, at pg. 10.

4. The Policy also includes the following provision:

"SECTION IV-COMMERCIAL GENERAL LIABILITY CONDITIONS

...

2. Duties in the Event of Occurrence, Offense, Claim or Suit

...

C. You and any other insured must:

(3) Cooperate with us in the investigation and settlement of the claim or defense against the "suit;"...

See Policy and Endorsements, Section IV, paragraph 2 (c)(3), Docket No. 347-2, at pg. 1.

5. On April 8, 2013, Cooperativa sent WIN a letter stating that the Policy did not provide coverage for the incident pursuant to the Policy's Abuse and Molestation Exclusion. See Letter from Cooperativa to WIN, Docket No. 347-3.

6. On July 13, 2013, WIN filed a Third Party Complaint against Cooperativa stating that Cooperativa had denied coverage under the Policy. Docket No. 36.

Rodríguez' background

7. Prior to working as a private security guard, Rodríguez was a state police officer in Carolina, Puerto Rico, from 2001 to 2011. See Puerto Rico Police Department ("PRPD") Administrative Record (Certified Translation), Docket No. 354-14.

8. When he was discharged from the PRPD in 2011, Rodríguez had several complaints in his record, including: domestic violence (2004 and 2010); negligence (2006 and 2007); illegal or unreasonable search and seizure (2008); and immoral behavior (2011). See PRPD Administrative Record (Certified Translation), Docket No. 354-14.

9. Rodríguez was arrested on August 2011, after selling approximately 200 nine caliber ammunition to an undercover agent. Rodríguez was discharged from the Police force following his arrest. See PRPD Administrative Record (Certified Translation), Docket No. 354-14, at pgs. 5-7.

10. The news of the arrest of Rodríguez were covered by local newspapers. See El Nuevo Día news clip, Docket No. 354-15.

11. In February 2012, Rodríguez was convicted of violating Puerto Rico's Law of Firearms and sentenced to two years' probation. See Amended Judgment in Crim. No. HSCR201101497 (Certified Translation), Docket No. 354-16.

12. Pursuant to a Negative Certification issued on July 15, 2016, Rodríguez, as of that date, was not registered as a security guard. See Negative Certificate, Docket No. 354-17.

V. Analysis

A. First Motion for Summary Judgment

Plaintiffs claim that Cooperativa, as WIN's insurer, is directly liable for the damages that Lindsey Grasis sustained. Docket No. 71. Specifically, the Second Amended Complaint claims that WIN failed to exercise reasonable care when it hired Rodríguez and failed to perform background checks on him. Id. Cooperativa counters that the policy that it issued to WIN includes an abuse/molestation exclusion that should be enforced.

The analysis mirrors the one we carried out to examine the policy issued by MAPFRE to Consejo, which was discussed in the R&R at Docket No. 387. Cooperativa avers that there is no coverage because the claims against WIN fall squarely into the second modality of the exclusion: the negligent employment or supervision prong. Under that modality, the insurance policy would not apply to claims arising out of the negligent employment or supervision of a person for whom WIN is or ever was legally responsible, and who committed actual abuse or molestation on anyone while the victim was in the "care, custody or control" of WIN.

The first requirement is easily met. Cooperativa's insurer, WIN, is being sued on the basis of its negligent employment and supervision of Rodríguez. See Docket No. 71 at ¶¶ 80-92. Likewise, since Rodríguez was an employee of WIN, a fact that is undisputed, the latter was "legally responsible" for Rodríguez.

As to the third prong, Cooperativa alleges that the duty of care of Consejo towards...