Opinion
Case No. 18-23960-CIV-WILLIAMS
09-12-2019
ENDURANCE ASSURANCE CORPORATION, Plaintiff, v. Gloria ZOGHBI, et al., Defendants.
Daniel Michael Hirschman, James Miller Kaplan, Kaplan Zeena LLP, Miami, FL, for Plaintiff. Derek Eduardo Leon, Leon Cosgrove, LLC, Jeremy L. Kahn, Leon Cosgrove, LLP, John Richard Byrne, Leon Cosgrove, Coral Gables, FL, Dennis Gary Kainen, Weisberg & Kainen, Miami, FL, for Defendants.
Daniel Michael Hirschman, James Miller Kaplan, Kaplan Zeena LLP, Miami, FL, for Plaintiff.
Derek Eduardo Leon, Leon Cosgrove, LLC, Jeremy L. Kahn, Leon Cosgrove, LLP, John Richard Byrne, Leon Cosgrove, Coral Gables, FL, Dennis Gary Kainen, Weisberg & Kainen, Miami, FL, for Defendants.
ORDER
KATHLEEN M. WILLIAMS, UNITED STATES DISTRICT JUDGE
THIS MATTER is before the Court on Defendants Elite Premium Finance, Inc. ("Elite") and Security Premium Finance, Inc.'s ("Security") motion to dismiss. (DE 7). Defendants Gloria Zoghbi and Florida Insurance Agency of Miami, Inc. (the "Agency" or "Florida Insurance Agency") joined in the motion. (DE 23). Plaintiff Endurance Assurance Corporation ("Endurance") filed a response in opposition (DE 15) and Elite and Security filed a reply (DE 18). For the reasons set forth below, the motion to dismiss is GRANTED.
I. BACKGROUND
In May 2017, Plaintiff Endurance issued an errors and omissions insurance policy (the "Policy") to Defendant Florida Insurance Agency for the period of May 7, 2017 to May 7, 2018. (DE 1). Defendant Antonio Zoghbi, the Agency's president, and Defendant Gloria Zoghbi, the Agency's vice-president, were also insured under the Policy. (Id. ).
The Agency was engaged by two finance companies, Defendants Elite and Security, "to locate individuals and businesses in need of insurance premium financing." (Id. ). The Agency was also "delegated the responsibility of ... securing access to financing from Elite and Security for the purpose of paying premiums to insurance companies; [ ] collecting the monthly installment payments from the insured customers; and [ ] delivering the payments to Elite and Security while receiving a fee for its services." (Id. ). Instead, according to Elite and Security, "the Agency acting through Mr. Zoghbi conducted a four-year Ponzi scheme from 2013 through 2017 wherein Mr. Zoghbi stole approximately $4.7 million of funds belonging to Elite and Security." (Id. ).
According to the complaint, in October 2017, Mr. and Ms. Zoghbi "disclosed the specific details of the Ponzi scheme to Elite and Security" upon Elite and Security's repeated demands for outstanding payments. (Id. ). Thereafter, in December 2017, Mr. and Ms. Zoghbi entered into a written settlement agreement with Elite and Security whereby they "admitted liability for their unlawful actions and transferred their ill-gotten assets—valued in the hundreds of thousands of dollars—to Elite and Security." (Id. ). Endurance claims that Mr. and Ms. Zoghbi entered into this settlement agreement without its knowledge or consent, and that it was not notified until March 2018, upon receiving a notice of claim from Elite and Security. (Id. ).
In the March 2018 notice of claim, Elite and Security disclosed the details of the Ponzi scheme and "stated that they remained owed several million dollars as a result of the unlawful actions undertaken by the Zoghbis." (Id. ). In July 2018, still owed payments, Elite and Security filed a complaint against Ms. Zoghbi in the Circuit Court in and for Miami-Dade County, Florida, asserting two causes of action—breach of fiduciary duty and negligence (the "Underlying Action"). According to Elite and Security, Ms. Zoghbi neglected her duties as vice-president of the Agency and allowed Mr. Zoghbi's Ponzi scheme to go undetected. (DE 1-1). Elite and Security did not file suit against Mr. Zoghbi or the Agency in the Underlying Action. (Id. ).
The Underlying Action was then "tendered to Endurance for defense and indemnity." (DE 1). Approximately one week later, Endurance issued a reservation of rights letter to Ms. Zoghbi, offering to defend her "while reserving its rights to a declaratory judgment defining its obligations under the Policy; to a declaratory judgment that rescinds the Policy; and to withdraw the defense of the Underlying Action, if appropriate." (Id. ). Elite and Security assert that because Endurance would not provide Ms. Zoghbi with an unconditional defense, Ms. Zoghbi entered into a settlement and assignment agreement with Elite and Security, known as a Coblentz agreement. (DE 7). A Coblentz agreement is "a negotiated settlement in which the defendant agrees to a consent judgment and assigns, to the injured party, any cause of action the defendant had against the defendant's insurer." Bright House Networks, LLC v. Pinellas Cty. , No. 8:14-CV-1237-T-33TBM, 2014 WL 4794786, at *1 n.1 (M.D. Fla. Sept. 25, 2014).
Endurance attached to its complaint the settlement agreement entered into in December 2017 (DE 1-2), and Elite and Security attached to their motion to dismiss the Coblentz settlement agreement entered into in September 2018 after Elite and Security filed the Underlying Action (DE 7-1). Endurance characterizes the Coblentz agreement as "extrinsic evidence." (DE 15). If Endurance is suggesting that the Court cannot look at the Coblentz agreement because it is not attached to the complaint, then Endurance is incorrect. Elite and Security have raised a jurisdictional challenge, and "[w]hen the jurisdictional attack is factual, as in the instant case, the presumption of truthfulness afforded to a plaintiff under Fed. R. Civ. P. 12(b)(6) does not attach." Bright House Networks, LLC v. Pinellas Cty. , No. 8:14-CV-1237-T-33TBM, 2014 WL 4794786, at *2 (M.D. Fla. Sept. 25, 2014). Thus, "[b]ecause the very power of the Court to hear the case is at issue, the Court is free to weigh evidence outside the four corners of the complaint." Id.
In the Coblentz agreement, Ms. Zoghbi consented to a judgment against her of $4,987,088. (DE 7-1). She also assigned to Elite and Security "all of her right, title, and interest in the policy and any and all causes of action she may have against Endurance (and any other insurer)," and against Professional Underwriting Group, Inc. ("Professional Underwriting Group"), a Florida company that the agreement defines as the insurance broker. (Id. ). Ms. Zoghbi also assigned to Elite and Security "the defense of any action brought against her by Endurance relating to insurance coverage under the Policy." (Id. ).
Thereafter, in September 2018, Elite and Security, acting in their own right and as Ms. Zoghbi's assignees, brought suit against Endurance in Florida state court (the "Parallel State Action"). (DE 7-3). There, the complaint raised two causes of action—breach of contract and common law bad faith—against Endurance for failing to provide Ms. Zoghbi with an unqualified defense and coverage in the Underlying Action. (Id. ). It also raised two causes of action—negligence and breach of fiduciary duty—against Professional Underwriting Group, the broker that, according to Elite and Security, had procured the policy.
Although Plaintiff did not raise this in its Complaint, as discussed, "[b]ecause the very power of the Court to hear the case is at issue, the Court is free to weigh evidence outside the four corners of the complaint." Bright House Networks, LLC , 2014 WL 4794786, at*2. Moreover, "[t]he Court may take judicial notice of another court's docket entries and orders for the limited purpose of recognizing the filings and judicial acts they represent." Geico Indem. Co. v. Vazquez , No. 15-61442-CIV, 2016 WL 10587207, at *1 n.2 (S.D. Fla. Nov. 4, 2016) (citing McDowell Bey v. Vega , 588 F. App'x 923, 926-27 (11th Cir. 2014) (finding that the district court properly took judicial notice of entries appearing on state court's docket sheet)).
Five days after Elite and Security filed the Parallel State Action, Endurance filed this action against Elite and Security and against Mr. Zoghbi, Ms. Zoghbi and Florida Insurance Agency. (DE 1). Here, Endurance presents three claims: two for declaratory judgment and one for rescission. (Id. ). Specifically, Endurance claims that it did not owe a duty to defend Ms. Zoghbi in, or to indemnify her against, the Underlying Action. (Id. ). Endurance also seeks, in the alternative, to rescind the insurance policy due to material misrepresentations made in the application for its issuance. (Id. ).
Under Count I, Endurance alleges several grounds as to why it believes it did not owe Ms. Zoghbi an unqualified defense: (1) Ms. Zoghbi was sued for corporate mismanagement and not for errors or omissions she committed when rendering professional services; (2) the return, restitution, or disgorgement of payments that Elite and Security seek do not fall within the policy's definition of "damages"; (3) the policy excludes coverage for the commingling, conversion, misappropriation, and defalcation of funds, and for the inability to pay, collect, or safeguard funds; (4) the policy excludes coverage for any claim for premiums, return premiums, commissions, brokerage fees, or tax monies; (5) Ms. Zoghbi did not provide the written notice the policy requires; and (6) the policy prohibited Ms. Zoghbi, except at her own expense, from making any payment, admitting any liability, settling any claim, or assuming any responsibility. (Id. ).
Under Count II, Endurance likewise alleges the grounds as to why it believes it did not owe Ms. Zoghbi indemnity: (1) the policy does not cover claims for corporate mismanagement; (2) the policy's definition of "damages" does not include the return, restitution, or disgorgement of payments; (3) the policy excludes coverage for claims based on any fraudulent acts or omissions, or the intentional violation of any statute, rule, or law; (4) the policy excludes coverage for claims based on any personal profit or advantage Ms. Zoghbi enjoyed as a result of the Ponzi scheme; (5) the policy excludes coverage for claims based on false, deceptive, or unfair business practices; (6) the policy excludes coverage for the commingling, conversion, misappropriation, and defalcation of funds, and for the inability to pay, collect, or safeguard funds; (7) the policy excludes coverage for any claim for premiums, return premiums, commissions, brokerage fees, or tax monies; (8) Ms. Zoghbi did not provide the written notice the policy requires; and (9) the policy prohibited Ms. Zoghbi, except at her own expense, from making any payment, admitting any liability, settling any claim, or assuming any responsibility. (Id. ).
Under Count III, Endurance seeks, as an alternative claim, rescission of the policy. Endurance alleges that Florida Insurance Agency made material misrepresentations when "Mr. Zoghbi responded that he did not know of any circumstance, error, omission or offense that could result in a claim against" himself, Ms. Zoghbi, or their company. (Id. ). In truth, Endurance contends, the insureds "knew of several circumstances that could result in a claim, including the theft of funds belonging to Elite and Security." (Id. ).
Elite and Security moved to dismiss this case in light of the Parallel State Action they filed prior to Endurance bringing this action. (DE 7). Shortly after Elite and Security filed their motion to dismiss, Endurance removed the Parallel State Action to this district. See Elite Premium Finance, Inc. et al v. Endurance Assurance Corporation et al. , No. 18-cv-24297-RNS, DE 1. Consequently, in its opposition to the motion to dismiss filed in this case, Endurance argued, among other things, that there no longer existed a parallel state court action. (DE 15). In their reply, Elite and Security criticized Endurance's "procedural maneuvering" and noted that a motion to remand the action to state court was forthcoming. (DE 18). Indeed, Elite and Security filed a motion to remand the Parallel State Action back to state court, and that motion was granted. See Elite Premium Finance, Inc. et al v. Endurance Assurance Co. et al. , No. 18-cv-24297-RNS, DE 26.
To date, the state-court docket shows that the Parallel State Action is pending and Elite and Security have filed a motion for partial summary judgment on Endurance's sixth affirmative defense, which concerns whether the insurance policy excludes coverage for the commingling, conversion, misappropriation, and defalcation of funds, and for the inability to pay, collect, or safeguard funds. The state court has set the motion for a hearing on October 21, 2019.
As discussed, "[i]n resolving a motion to dismiss, a court may consider materials subject to judicial notice without converting the motion to dismiss into a motion for summary judgment.... Federal Rule of Evidence 201 permits courts to take judicial notice of a fact that is not subject to reasonable dispute because it[ ]... can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned." Mid-Continent Cas. Co. v. Gozzo Dev., Inc. , No. 17-CV-80362, 2017 WL 3578846, at *5 n.3 (S.D. Fla. July 19, 2017) (internal quotations omitted).
II. LEGAL STANDARD
To survive a Rule 12(b)(6) motion to dismiss, a plaintiff must plead sufficient facts to state a claim that is "plausible on its face." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). The Court's consideration is limited to the allegations in the complaint. See GSW, Inc. v. Long Cty. , 999 F.2d 1508, 1510 (11th Cir. 1993). All factual allegations are accepted as true and all reasonable inferences are drawn in the plaintiff's favor. See Speaker v. U.S. Dep't. of Health & Human Servs. Ctrs. for Disease Control & Prevention , 623 F.3d 1371, 1379 (11th Cir. 2010) ; see also Roberts v. Fla. Power & Light Co. , 146 F.3d 1305, 1307 (11th Cir. 1998). Although a plaintiff need not provide "detailed factual allegations," a complaint must provide "more than labels and conclusions." Twombly , 550 U.S. at 555, 127 S.Ct. 1955. "[A] formulaic recitation of the elements of a cause of action will not do." Id. Rule 12(b)(6) does not allow dismissal of a complaint because the court anticipates "actual proof of those facts is improbable" but the "[f]actual allegations must be enough to raise a right to relief above the speculative level." Watts v. Fla. Int'l Univ. , 495 F.3d 1289 (11th Cir. 2007) (quoting Twombly , 550 U.S. at 545, 127 S.Ct. 1955 ).
III. ANALYSIS
Defendants Elite and Security argue that the Court should dismiss this matter because an exercise of jurisdiction over Plaintiffs' declaratory judgment action "would amount to ‘unnecessary and inappropriate interference with [a] parallel state court action, which will resolve the entire controversy.’ " (DE 7) (citing Ameritas Variable Life Ins. Co. v. Roach , 411 F.3d 1328, 1329 (11th Cir. 2005) (hereinafter " Ameritas ")). The Parties dispute whether the Court should apply the flexible, nine-factor analysis of Ameritas or the more onerous exceptional-circumstances standard and six-factor test outlined in Colorado River Water Conservation District v. United States to determine whether it should exercise jurisdiction. See Colorado River Water Conservation District , 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976) (hereinafter " Colorado River "); see also Ameritas , 411 F.3d 1328 (11th Cir. 2005). Courts have explained that Ameritas applies to declaratory judgment suits, while Colorado River applies to suits involving monetary damages. See e.g. , Gregory Haskin Chiropractic Clinics, Inc. v. State Farm Mut. Auto. Ins. Co. , 391 F.Supp.3d 1151, 1153 (S.D. Fla. 2019).
The Declaratory Judgment Act is "an enabling Act, which confers a discretion on courts rather than an absolute right upon the litigant." Ameritas , 411 F.3d at 1330 (quoting Wilton v. Seven Falls Co. , 515 U.S. 277, 287, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995) ). "It only gives the federal courts competence to make a declaration of rights; it does not impose a duty to do so." Id. (citing Brillhart v. Excess Ins. Co. of Am. , 316 U.S. 491, 494, 62 S.Ct. 1173, 86 L.Ed. 1620 (1942) ). In Ameritas , the Eleventh Circuit provided a non-exhaustive list of nine factors for courts to consider as "guideposts in furtherance of the Supreme Court's admonitions in Brillhart and Wilton . " Id. at 1331. The factors are as follows:
(1) the strength of the state's interest in having the issues raised in the federal declaratory action decided in the state courts;
(2) whether the judgment in the federal declaratory action would settle the controversy;
(3) whether the federal declaratory action would serve a useful purpose in clarifying the legal relations at issue;
(4) whether the declaratory remedy is being used merely for the purpose of "procedural fencing"—that is, to provide an arena for a race for res judicata or to achieve a federal hearing in a case otherwise not removable;
(5) whether the use of a declaratory action would increase the friction between our federal and state courts and improperly encroach on state jurisdiction;
(6) whether there is an alternative remedy that is better or more effective;
(7) whether the underlying factual issues are important to an informed resolution of the case;
(8) whether the state trial court is in a better position to evaluate those factual issues than is the federal court; and
(9) whether there is a close nexus between the underlying factual and legal issues and state law and/or public policy, or whether federal common or statutory law dictates a resolution of the declaratory judgment action.
Id.
The Eleventh Circuit has also interpreted the abstention doctrine set forth by the Supreme Court in Colorado River and its progeny and has "catalogued six factors that must be weighed in analyzing the permissibility of abstention, namely: (1) whether one of the courts has assumed jurisdiction over property, (2) the inconvenience of the federal forum, (3) the potential for piecemeal litigation, (4) the order in which the fora obtained jurisdiction, (5) whether state or federal law will be applied, and (6) the adequacy of the state court to protect the parties' rights." Ambrosia Coal & Const. Co. v. Pages Morales , 368 F.3d 1320, 1331 (11th Cir. 2004).
Here, Endurance's complaint includes three counts: two for declaratory judgment and one for rescission. (DE 1). In Gregory Haskin Chiropractic Clinics, Inc. , the court considered whether to apply Ameritas or Colorado River to a complaint with a count for declaratory judgment and a count for breach of contract. Gregory Haskin Chiropractic Clinics, Inc. , 391 F.Supp.3d 1151. The court explained that "[a]lthough the Eleventh Circuit has not spoken on this subject, the [c]ourt will follow the other decisions in this district in adopting the ‘heart of the matter’ test ... [which] provides a more flexible approach which allows ‘district courts to treat different cases differently based on the fundamental character of a particular action.’ " Id. (citing Lexington Ins. Co. v. Rolison , 434 F. Supp. 2d 1228, 1237 (S.D. Alabama 2006) ).
Under the "heart of the matter" test, the Court must determine whether "the outcome of the coercive claims hinges on the outcome of the declaratory ones." Id. If so, Ameritas controls, and if not, Colorado River controls. Id. In Gregory Haskin Chiropractic Clinics, Inc. , the court found that, at its core, the matter was a declaratory judgment action because the breach of contract claim did "not raise any distinct factual or legal issues and require[d] the same analysis as the declaratory judgment claim" and the court's "decision on the declaratory judgment count [would] determine if the [p]laintiff is entitled to damages under the breach of contract count." Id.
Similarly, in W. Coast Life Ins. Co. , the court applied the "heart of the matter" test to a lawsuit for declaratory relief, rescission, and damages, and found that the case was, at its core, a declaratory judgment action. See W. Coast Life Ins. Co. v. Ruth Secaul 2007-1 Ins. Tr. , No. 09-81049-CIV, 2010 WL 11506019, at *3-5 (S.D. Fla. May 14, 2010). There, the plaintiff claimed that the defendants had "collaborated in a stranger-originated life insurance [ ] scheme whereby elderly persons were recruited to pose as applicants for, and proposed owners of, large-face-amount life insurance policies." Id. at *1. According to the plaintiff, the policies were procured to avoid the insurable interest requirements of state law to then hold and/or sell the policies to investors. Id. Along with various damages claims, the plaintiff sought a declaration that the policies be rescinded based on fraud, misrepresentation, and lack of an insurable interest. Id. Ultimately, the court found that the non-declaratory claims did not "raise any distinct factual or legal issues" and required the same analysis that the declaratory judgment claims required. Id. at *5. And as such, the non-declaratory claims depended on the outcome of the declaratory claims, making the case, at its heart, a declaratory judgment action. Id.
That analysis applies with equal force here. Endurance's rescission claim is premised on alleged misrepresentations made on the insurance application submitted to Endurance for its issuance of the insurance policy. Specifically, Endurance claims that "Florida Insurance Agency made a material misrepresentation on the [a]pplication when Mr. Zoghbi responded that he did not know of any circumstance, error, omission or offense that could result in a claim against the Agency, Mr. Zoghbi, or Ms. Zoghbi", when in fact, he and Florida Insurance Agency and/or Ms. Zoghbi "knew of several circumstances that could result in a claim, including the theft of funds belonging to Elite and Security." (DE 1). Endurance's declaratory judgment claims are also premised in part on the insureds' alleged theft of funds belonging to Elite and Security and whether the policy provides coverage for such claims and their resulting damages. (Id. ) ("Elite and Security allege damages based upon or arising out of the Ponzi scheme ... [t]he Policy excludes coverage based upon or arising out of any fraudulent acts and/or omissions or intentional violation of any statute, rule, or law."). Thus, the rescission claim depends on the outcome of the declaratory judgment claims, requires "the same analysis" as those claims and raises no distinct factual or legal issues. W. Coast Life Ins. , 2010 WL 11506019, at *5. To be sure, the declaratory judgment claims raise more issues than those present in the rescission claim, such as the alleged lack of notice. (DE 1). But the fact that the declaratory judgment claims, as opposed to the rescission claim, raise additional issues only strengthens the Court's conclusion that, at its heart, this is a declaratory judgment case. Therefore, the Court will apply the Ameritas factors.
"The first, fifth, and ninth Ameritas factors look to concerns of comity and the interest of the forum state in resolving the legal issues presented." Geico Gen. Ins. Co. v. Pruitt , No. 08-21623-CIV, 2009 WL 10666845, at *3 (S.D. Fla. Feb. 19, 2009). Those factors weigh in favor of dismissal: this case involves only state-law issues, it may have significant implications for insurance coverage under Florida law, and there is no federal nexus save for the presence of diversity jurisdiction. See id. (dismissing declaratory judgment case without prejudice based on the same considerations); see also Mid-Continent Cas. Co. v. Northstar Homebuilders, Inc. , 297 F. Supp. 3d 1329, 1336 (S.D. Fla. 2018) ("Given Florida law, not federal, governs the substantive issues raised, Florida has a strong interest in this case and federal jurisdiction over this action would only encroach the province of the state court."). Similar to the plaintiff in Geico General Ins. Co. , Endurance challenges its coverage obligations under the issued insurance policy. See Geico Gen. Ins. Co. , 2009 WL 10666845, at *3. But just as the Court in Geico General Ins. Co. found, this Court finds that resolving whether alleged misrepresentations relieve the insurer of a coverage obligation would "have potentially significant implications regarding insurance coverage under Florida law." Id. Moreover, Endurance acknowledges that "Florida substantive law applies to resolve this action," does not contend that any of these factors weigh in its favor, and instead states that the factors are neutral. (DE 15).
"Along these same lines, the seventh and eighth Ameritas factors examine the ability of the state court to resolve the legal and factual issues relative to the federal court." Geico Gen. Ins. Co. , 2009 WL 10666845, at *3. These factors also weigh in favor of dismissal. As discussed, the Parallel State Action is an action for breach of contract and common law bad faith arising from Endurance's alleged "wrongful declination of insurance coverage and refusal to provide an unqualified defense" with regard to claims brought by Elite and Security against Ms. Zoghbi in the Underlying Action. (DE 7-3). The action in this Court is for a declaration that Endurance does not owe a duty to defend or indemnify Ms. Zoghbi in the Underlying Action, that it does not owe a duty to indemnify Mr. Zoghbi, Ms. Zoghbi, or the Agency for any claims that were brought, or could have been brought, in the Underlying Action, and in the alternative for rescission of the insurance policy. Not only does Florida law govern consideration of the insurance policy, but the Underlying Action that is at the heart of both matters, and that ultimately resulted in the Coblentz agreement, was brought in Florida state court. Accordingly, a Florida state court is better situated to consider the factual context underlying the issues as well as the law governing the legal issues. See e.g. , Gregory Haskin Chiropractic Clinics, Inc. v. State Farm Mut. Auto. Ins. Co. ,391 F.Supp.3d 1151, 1156 (S.D. Fla. 2019) (finding that a state court is better situated to analyze Florida law issues involving "the interpretation of a Florida statute and an insurance contract under Florida law than a federal court.").
The second, third, and sixth Ameritas factors look to, in essence, whether "the declaratory judgment action is the most efficient and economical forum to resolve the rights of all the parties"; in other words, whether it could settle the whole controversy, clarify the legal relations at issue, and provide a better remedy than the alternative forum. See Geico Gen. Ins. , 2009 WL 10666845, at *4. Because the Parallel State Action is more comprehensive than this action, the Court finds that these factors also weigh in favor of dismissal. For example, the complaint in the Parallel State Action states that "if it is ultimately adjudged that the insurance policy issued by Endurance does not cover the acts and omissions alleged in the Underlying Action, this is an action for negligence and breach of fiduciary duty against [Professional Underwriting Group] for failing to procure insurance coverage that would cover such acts and omissions when it had a duty to do so and such coverage was available at the time of procurement." (DE 7-3). As Professional Underwriting Group is not a party to this action, this Court could not settle the whole controversy. Rather, the only party that could be relieved from liability, if the Court finds in its favor, is Endurance and, such a finding could contravene findings of the state court. In essence, "[t]o allow the instant declaratory action to proceed would run the risk of inconsistent decisions and amount to ‘[g]ratuitous interference with the orderly and comprehensive disposition of a state court litigation.’ " W. Coast Life Ins. Co. v. Ruth Secaul 2007-1 Ins. Jr. , No. 09-81049-CIV, 2010 WL 11506019, at *5 (S.D. Fla. May 14, 2010) (finding that "in the interests of conservation of judicial resources, the potential for inconsistent judgments, and in light of the strong policy interest of [the state] in this litigation" abstention was warranted).
Although Plaintiff denies that Professional Underwriting Group acted as the broker for the subject policy, the district court's order remanding the parallel state action to state court, suggests otherwise. See Elite Premium Finance, Inc. et al. v. Endurance Assurance Corporation et al , Case No. 18-cv-24297-RNS (S.D. Fla.).
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Finally, the fourth Ameritas factor "considers whether the declaratory remedy is being used for res judicata or to achieve a federal hearing in a case otherwise not removable." Gregory Haskin Chiropractic Clinics, Inc. , 391 F.Supp.3d at 1155. As discussed above, the Parallel State Action was remanded to state court because no federal question was claimed, complete diversity was lacking, and Endurance failed to establish fraudulent joinder, an exception to the requirement of complete diversity. See Elite Premium Finance, Inc. et al v. Endurance Assurance Co. et al. , No. 18-cv-24297-RNS, DE 26. ("To be sure, Endurance's jurisdictional argument was thin."). Defendants Elite and Security argue that Plaintiff "implicitly recognizes that the [p]arallel [s]tate-[c]ourt action is not removable, but seeks to circumvent its way into federal court through this action." (DE 7). Consequently, the Court finds that this factor also weighs in favor of dismissal.
Accordingly, upon analysis of the Ameritas factors and consideration that "[d]istrict courts have ‘substantial latitude in deciding whether to stay or dismiss a declaratory judgment suit in light of pending state proceedings’, the Court finds that abstention is warranted." Great Lakes Reinsurance (UK) PLC v. TLU Ltd. , 298 F. App'x 813, 814 (11th Cir. 2008) (quoting Wilton , 515 U.S. at 286, 115 S.Ct. 2137 ).
IV. CONCLUSION
For the reasons set forth above, Defendants' motion to dismiss (DE 7) is GRANTED and Plaintiff's complaint is DISMISSED. All pending motions are DENIED AS MOOT. The Clerk is directed to CLOSE this case.
DONE AND ORDERED in Chambers in Miami, Florida, this 12th day of September, 2019.