United States District Court, D. Nevada
M. NAVARRO, CHIEF JUDGE
before the Court is the Motion for Summary Judgment, (ECF No.
27), filed by Plaintiff United National Insurance Company
(“United National”). Defendants Audra Duvall and
Michael Duvall (collectively “the Duvalls”) did
not file a response. For the reasons set forth herein,
Plaintiff's Motion for Summary Judgment is
declaratory judgment action arises from a lawsuit filed in
Clark County District Court, styled Duvall, et al. v.
Aposseadesse III, LLC, et al., case no. A-13-681072-C
(“the Duvall Action”). At all times
relevant to this case, Defendant Limmie Young, III
(“Young”) was employed as a masseuse by Defendant
Aposseadesse III, LLC (“Aposseadesse”).
(See Duvall Compl. ¶ 14, Ex. 1 to Nielsen
Decl., ECF No. 28-1). On May 8, 2011, Young allegedly engaged
in inappropriate and sexual acts against Audra Duvall while
administering a massage at Aposseadesse. (Id.
¶¶ 14-25). This incident became the subject matter
of the state court lawsuit. (Id.).
March 2016, the Duvall Action proceeded to a jury
trial, and the jury returned a verdict in favor of Audra
Duvall and Michael Duvall. (Jury Verdict, Ex. 2 to Nielsen
Decl., ECF No. 28-2). The jury awarded $59, 675 in general
damages and $100, 000 in punitive damages to Audra Duvall and
$750 in general damages to Michael Duvall. (Judgment 2:13-
3:23, Ex. 5 to Nielsen Decl., ECF No. 28-5). The punitive
damages were awarded based on a finding that both
Aposseadesse and Young “engaged in oppressive or
malicious conduct” against Audra Duvall. (Punitive
Verdict Form, Ex. 3 to Nielsen Decl., ECF No. 28-3).
the underlying litigation, United National defended
Aposseadess as the named insured on a contract of
professional liability insurance. (Mawby Decl. ¶¶
4, 5, ECF No. 29). On January 22, 2016, United National filed
the instant declaratory judgment action, seeking a
declaration regarding its contractual and financial
obligations in the underlying lawsuit. (Compl., ECF No. 1).
Defendants Young and Aposseadesse failed to respond to the
Complaint, and the Court granted United National's
Motions for Entry of Clerks Default against those parties.
(ECF Nos. 16, 17). On July 31, 2017, United National filed
its Motion for Summary Judgment against the Duvalls. (ECF No.
Federal Rules of Civil Procedure provide for summary
adjudication when the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any, show that “there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a).
Material facts are those that may affect the outcome of the
case. See Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248 (1986). A dispute as to a material fact is genuine
if there is sufficient evidence for a reasonable jury to
return a verdict for the nonmoving party. See Id.
“Summary judgment is inappropriate if reasonable
jurors, drawing all inferences in favor of the nonmoving
party, could return a verdict in the nonmoving party's
favor.” Diaz v. Eagle Produce Ltd. P'ship,
521 F.3d 1201, 1207 (9th Cir. 2008) (citing United States
v. Shumway, 199 F.3d 1093, 1103-04 (9th Cir. 1999)). A
principal purpose of summary judgment is “to isolate
and dispose of factually unsupported claims.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323-24
determining summary judgment, a court applies a
burden-shifting analysis. “When the party moving for
summary judgment would bear the burden of proof at trial, it
must come forward with evidence which would entitle it to a
directed verdict if the evidence went uncontroverted at
trial. In such a case, the moving party has the initial
burden of establishing the absence of a genuine issue of fact
on each issue material to its case.” C.A.R. Transp.
Brokerage Co. v. Darden Rests., Inc., 213 F.3d 474, 480
(9th Cir. 2000) (citations omitted). In contrast, when the
nonmoving party bears the burden of proving the claim or
defense, the moving party can meet its burden in two ways:
(1) by presenting evidence to negate an essential element of
the nonmoving party's case; or (2) by demonstrating that
the nonmoving party failed to make a showing sufficient to
establish an element essential to that party's case on
which that party will bear the burden of proof at trial.
See Celotex Corp., 477 U.S. at 323- 24. If the
moving party fails to meet its initial burden, summary
judgment must be denied and the court need not consider the
nonmoving party's evidence. See Adickes v. S.H. Kress
& Co., 398 U.S. 144, 159-60 (1970).
moving party satisfies its initial burden, the burden then
shifts to the opposing party to establish that a genuine
issue of material fact exists. See Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586
(1986). To establish the existence of a factual dispute, the
opposing party need not establish a material issue of fact
conclusively in its favor. It is sufficient that “the
claimed factual dispute be shown to require a jury or judge
to resolve the parties' differing versions of the truth
at trial.” T.W. Elec. Serv., Inc. v. Pac. Elec.
Contractors Ass'n, 809 F.2d 626, 631 (9th Cir.
1987). In other words, the nonmoving party cannot avoid
summary judgment by relying solely on conclusory allegations
that are unsupported by factual data. See Taylor v.
List, 880 F.2d 1040, 1045 (9th Cir. 1989). Instead, the
opposition must go beyond the assertions and allegations of
the pleadings and set forth specific facts by producing
competent evidence that shows a genuine issue for trial.
See Celotex Corp., 477 U.S. at 324. At summary
judgment, a court's function is not to weigh the evidence
and determine the truth but to determine whether there is a
genuine issue for trial. See Anderson, 477 U.S. at
249. The evidence of the nonmovant is “to be believed,
and all justifiable inferences are to be drawn in his
favor.” Id. at 255. But if the evidence of the
nonmoving party is merely colorable or is not significantly
probative, summary judgment may be granted. See Id.
instant Motion, United National seeks a declaration regarding
its remaining obligations towards the Duvall Action.
(See Pl.'s MSJ 1:24-2:5, ECF No. 27). In ruling
on this Motion, the Court must evaluate two issues: (1)
whether United National's policy with Aposseadesse
affords indemnity for punitive damages; and (2) whether
United National has fulfilled its obligations towards the
Duvall Action judgment. The Court addresses each
issue in turn.
National argues that its indemnity obligation under the
insurance contract does not extend to the $100, 000 punitive
damages award. (Pl.'s MSJ 7:3-10). In interpreting
contracts, courts “should not rewrite contract
provisions that are otherwise unambiguous.”
Id.; see also Ellison v. Cal. State Auto.
Ass'n, 797 P.2d 975, 977 (Nev. 1990)
(“[C]ontracts will be construed from the written
language and enforced as written.”). With respect to
insurance contracts, “[p]olicy terms should be viewed
in their plain, ordinary and popular connotations.”
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