Opinion
C.A. No. N19C-05-108 MMJ CCLD
11-18-2020
ZURICH AMERICAN INSURANCE COMPANY and AMERICAN GUARANTEE AND LIABILITY COMPANY, Plaintiffs, v. SYNGENTA CROP PROTECTION, LLC, Defendant.
ORDER
Granting Plaintiffs' Motion to Deposit Fund with the Court Pursuant to Rule 67
Upon consideration of the parties' written and oral submissions, the Court grants Plaintiffs' Motion to Deposit Funds With The Court Pursuant to Rule 67 for the following reasons:
1. Superior Court Civil Rule 67 provides in full as follows: "Deposit in Court. In an action in which any part of the relief sought is a judgment for a sum of money or the disposition of a sum of money or the disposition of any other thing capable of delivery, a party, upon notice to every other party, and by leave of Court, may deposit with the Court all or any part of such sum or thing, whether or not that party claims all or any part of the sum or thing. The party making the deposit shall serve the order permitting deposit on the Prothonotary. Money paid into court under this rule shall be withdrawn only upon order of the Court. The fund shall be deposited in an interest-bearing account or invested in an interest-bearing instrument approved by the Court."
2. Plaintiffs Zurich American Insurance Company and American Guarantee and Liability Insurance Company (collectively, "Zurich") first proposed to deposit with the court the sum of $18,747,312.89, constituting interim payments that Zurich was prepared to make to defendant Syngenta Crop Protection, LLC ("Syngenta") pursuant to the Court's Opinion of August 3, 2020. Zurich conditioned the deposit on Zurich's receipt and review of certain documentation of Syngenta's attorneys' fees and other expenses to be reimbursed under the Zurich policies. Zurich also sought leave to deposit any additional amounts that it determined were reasonable upon completion of its review of the law firm invoices.
3. Zurich supplemented its motion, having completed its review of the law firm invoices, to request to leave to deposit with the Court the sum of $21,398,458.17, constituting amounts detailed in the Supplement less Syngenta's $1 million self-insured retention under the Zurich primary policy.
4. Syngenta has opposed the motion, as supplemented. Syngenta contends that the Rule 67 request is yet another effort on the part of Zurich to avoid honoring its defense obligation in connection with the underlying Paraquat litigation. In addition, it contends that Zurich has demanded "arbitrary and unnecessary additional documentation and other information as a prerequisite to payment." Such additional documentation and other information includes: (i) sworn proof of payment of defense cost invoices, (ii) copies of contracts with e-discovery vendors, (iii) disbursement documentation, and (iv) unredacted or at most lightly-redacted invoices. Finally, Syngenta contends that Zurich "seeks to impose on the Court the burden of performing its claim handling duties." Syngenta urges that Zurich should be directed to provide Syngenta with payment of its defense costs forthwith.
5. The Court's understanding is that the issue of sworn evidence of payment is now moot. Syngenta has submitted its counsel's declaration which affirms that Syngenta paid the defense invoices submitted to Zurich. In addition, the Court's understanding is that the parties are conferring on an expedited basis in an effort to address any remaining redaction/waiver concerns, with potential revisions to the confidentiality stipulation that already is in-place.
6. The Court finds Rule 67 to be applicable to the circumstances presented. The proceeding before the Court is "an action in which ... part of the relief sought is a judgment for ... the disposition of a sum of money ...." In particular, at issue is the appropriate disposition, by way of advancement of defense expenses.
7. At the conclusion of argument, the Court directed Zurich to pay directly to Syngenta $4,369,591.87. Zurich no longer disputes the reasonableness of this amount.
8. The Court hereby grants Zurich's motion to deposit of the remaining sum of $17,028,866.30 within ten (10) business days of the date of this Order. Pursuant to Rule 67, Zurich shall serve on the Prothonotary a copy of this Order and the fund shall be deposited in an interest-bearing account acceptable to the Prothonotary.
9. Counsel are directed to confer in good faith and to advise the Court within thirty (30) calendar days of the date of this Order whether they have reached agreement with regard to the amount(s) to be advanced to Syngenta. Funds on-deposit may be withdrawn upon further order of the Court. In what the Court hopes will be the unlikely absence of such agreement, counsel are informed that the Court will consider referral to a Special Master with the request that that Special Master recommend to the Court any appropriate further action (including, without limitation, awards of pre-judgment and post-judgment interest as well as fees-for-fees).
IT IS SO ORDERED this 18th day of November, 2020.
/s/ Mary M . Johnston
The Honorable Mary M. Johnston