Opinion
CIVIL 3:23-CV-1153
03-11-2024
STATE FARM FIRE AND CAS. CO., Plaintiff, v. EDWARD SEPRISH, et al., Defendants.
Mehalchick Judge
REPORT AND RECOMMENDATION
Martin C. Carlson United States Magistrate Judge
I. Factual Background
We are now called upon to write the first draft of the final chapter in this litigation and recommend the proper scope of a default judgment in this lawsuit, following the defendants' failures to respond to this complaint in a meaningful fashion or otherwise litigate this case. By way of background, on July 11, 2023, State Farm commenced this declaratory judgment action against six individual defendants, known collectively as the Seprishes. (Doc. 1). In this lawsuit State Farm sought a declaration that it does not have a duty to defend and/or a duty to indemnify the Seprishes for the claims brought against them in a separate state court lawsuit. (Id. At 25).
The docket reflects that all of the defendants were served in July and August of 2023, but none of the named defendants ever answered the complaint. (Docs. 49). Accordingly, at State Farm's request, the clerk entered defaults against all of these defendants. (Docs. 10-21). State Farm then filed and served an amended complaint upon the defendants in October of 2023. (Docs. 22-26). Once again, the defendants failed to answer or otherwise respond to this amended complaint, and at State Farm's request the clerk entered a second set of defaults against them on the amended complaint. (Docs. 30-39).
In the wake of the entry of these two sets of defaults, on February 22, 2024, State Farm filed six motions for default judgment against each of the defaulting defendants. (Docs. 40, 42, 44, 46, 48, 50). The time for responding to these motions has now passed and none of the defendants have responded in any manner. To these motions Accordingly, in the face of these repeated defaults, for the reasons set forth below, it is recommended that these motions for default judgment (Docs. 40, 42, 44, 46, 48, 50) be granted.
II. Discussion
The clerk has entered defaults against these defendants due to their on-going defaults in this litigation. However, “[w]hen a plaintiff prevails by default, he or she is not automatically entitled to the [relief] they originally demanded. Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990). Rather, defaults are treated as admissions of the facts alleged, but a plaintiff may still be required to prove that he or she is entitled to the [relief] sought. Id.; DIRECTV Inc. v. Pepe, 431 F.3d 162, 165 (3d Cir. 2005).” Rainey v. Diamond State Port Corp., 354 Fed.Appx. 722, 724 (3d Cir. 2009).
In the instant case, State Farm seeks a declaratory judgment that it has no duty to defend or indemnify the Seprishes as a result of pending state court litigation. Under Pennsylvania law an insurer's defense and coverage duties with respect to litigation are triggered by the language of the underlying complaint. Kvaerner Metals Division of Kvaerner U.S., Inc. v. Commercial Union Ins. Co., 908 A.2d 888, 896 (Pa. 2006). The duty to defend commences when, comparing the factual allegations of the complaint with the terms of the policy at issue, a complaint alleges facts that potentially bring at least one claim alleged in the action within the coverage of the policy. Mutual Benefit Ins. Co. v. Haver, 725 A.2d 743, 745 (Pa. 1999). Therefore, it is a necessary prerequisite to recovery upon a policy for the insured to show a claim within the coverage provided by the policy. E.g., Erie Ins. Exchange v. Transamerica Ins. Co., 533 A.2d 1363, 1366 (Pa. 1987). For the policyholder to obtain coverage under an occurrence-based policy the alleged bodily injury or property damage must be caused by an occurrence, which is an accident. Gene's Restaurant, Inc. v. Nationwide Ins. Co., 548 A.2d 246, 247 (Pa. 1988).
In this case, State Farm contends without contradiction by the defendants that the allegations in the pending state court action brought against the Seprishes largely entail intentional conduct which is not an accident and, therefore, is not covered by its insurance policy. State Farm further asserts that the individual defendants in many instances are not the insureds covered by the policy and that defendants have failed to comply with the claims notice and processing provisions of the policy.
It appears that the allegations in State Farm's complaint and motions for default judgment are well-founded and uncontested. Therefore, given the defendants repeated failures to answer, respond or defend this case, default judgments should be entered against these individual defendants and the court should enter judgments granting these requests for declaratory relief and finding that Plaintiff State Farm Fire and Casualty Company has no duty or obligation under insurance policy no. 78-GH-Y829-0 to defend or indemnify any of the defendants in the underlying state court action captioned Kay v. Regula, et al., Docket No. 2019-201908711, pending in the Court of Common Pleas of Luzerne County, Pennsylvania.
III. Recommendation
Accordingly, for the foregoing reasons, IT IS RECOMMENDED that the Plaintiff's motions for default judgment (Docs. 40, 42, 44, 46, 48, 50) be GRANTED and declaratory judgments be entered in favor of State Farm finding that Plaintiff State Farm Fire and Casualty Company has no duty or obligation under insurance policy no. 78-GH-Y829-0 to defend or indemnify any of the defendants in the underlying state court action captioned Kay v. Regula, et al., Docket No. 2019201908711, pending in the Court of Common Pleas of Luzerne County, Pennsylvania.
The Parties are further placed on notice that pursuant to Local Rule 72.3:
Any party may object to a magistrate judge's proposed findings, recommendations or report addressing a motion or matter described in 28 U.S.C. § 636 (b)(1)(B) or making a recommendation for the disposition of a prisoner case or a habeas corpus petition within fourteen (14) days after being served with a copy thereof. Such party shall file with the clerk of court, and serve on the magistrate judge and all parties, written objections which shall specifically identify the portions of the proposed findings, recommendations or report to which objection is made and the basis for such objections. The briefing requirements set forth in Local Rule 72.2 shall apply. A judge shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made and may accept, reject, or modify, in whole or in part, the findings or recommendations made by the magistrate judge. The judge, however, need conduct a new hearing only in his or her discretion or where required by law, and may consider the record developed before the magistrate judge, making his or her own determination on the basis of that record. The judge may also receive further evidence, recall witnesses or recommit the matter to the magistrate judge with instructions.