United States District Court, D. South Carolina, Charleston Division
C. NORTON UNITED STATES DISTRICT JUDGE
matter comes before the court on bad faith action
(2:14-cv-03272) defendants Brown & Brown, Inc.
("Brown") and Hull & Company, Inc’s
("Hull") motion for summary judgment. ECF No. 158.
For the reasons set forth below, the court grants
Brown’s motion for summary judgment. The court further
grants Hull’s motion for summary judgment.
court will dispense with a lengthy recitation of the
underlying facts and mention only those facts that are
pertinent to this specific motion. On September 29, 2012, a
patron of Richard Ruth’s Bar and Grill, LLC struck
Emmanuel Kehagias ("Kehagias") during a pool game,
and Kehagias suffered severe injuries and permanent brain
damage as a result. George Giannaras was appointed to serve
as Kehagias’s guardian (collectively
"Kehagias"). This motion relates to a consolidated
matter involving two separate but related actions regarding
Founders Insurance Company’s ("Founders")
coverage obligations with respect to Kehagias’s
injuries under a general liability policy (the
"Policy") purchased by Richard Ruth, Jane Ruth, and
Richard Ruth’s Bar and Grill, LLC (the
"Ruths"). The first is a declaratory judgment
action, 2:13-cv-3035, in which plaintiff Founders requests
that the court declare that it is not required to provide
coverage under the Policy because the Ruths failed to provide
timely notice of the underlying personal injury lawsuit,
resulting in substantial prejudice. The second action is a
bad faith action, 2:14-cv-3272, filed by the Ruths and
Kehagias, alleging that Founders, Hull,  Brown, and Utica
Mutual Insurance Company ("Utica"),  failed to
properly handle the underlying personal injury claim. The
Ruths assigned their rights in the bad faith action to
Kehagias pursuant to an Assignment dated May 28, 2014.
Ruths have used Cherie Dumez ("Dumez") of the
Cherie Dumez Agency as their insurance agent for
approximately ten years. Dumez Dep. 20:15-21:12. To obtain
the Policy, the Ruths completed an application for insurance
and Dumez submitted the application to Hull, an insurance
broker and wholesaler, to obtain quotes from different
insurers. Dumez Dep. 19:3-11, 70:5-16. Dumez determined that
Founders offered the best quote. Id. Hull is a
subsidiary of Brown. Hull operates pursuant to producer
agreements with various insurers, including Founders. The
Founders producer agreement provides:
PRODUCER [Hull] agrees that the services performed by it
pursuant to this agreement shall be performed as an
independent contractor and not as the agent of employee of
ECF No. 166 Ex. A.
November 12, 2012, the Anastopoulo Law Firm sent the Ruths a
letter notifying them that Kehagias had retained the firm to
represent him in connection with the injuries he sustained at
the bar. Ms. Ruth faxed the letter to Dumez. Ms. Ruth Depo.
41:7-20. Dumez forwarded the letter to Melanie Yount
("Yount") at Hull on November 27, 2012. Dumez Dep.
39:9-40:9, ECF No. 157 Ex. 18. Kehagias alleges that Hull
failed to forward the letter to Founders or forwarded the
letter in a in a manner that appeared to be connected to a
separate claim. Dumez, Hull, and Founders exchanged a series
of emails on January 9, 2013. That same day, Dumez sent the
letter from the Anastopoulo Law Firm a second time. ECF No.
157 Ex. 19. Yount responded to the email and stated:
"Please see attached from the company. It appears that
they are not going o [sic] defend the insured per the
exclusions in the policy. Please advise of any questions or I
[sic] can do anything else." ECF No. 180 Ex. 10. Dumez
responded: "Thanks for this….but there is
yet…another one for an assault and battery claim that
happened in 2012. That is the biggie we are worried
about." Id. Dumez’s hand-written notes on
the email state that "Melanie sent [Dumez] info on wrong
and Brown (collectively "Hull") filed the present
motion on October 14, 2015. ECF No. 158. Kehagias filed a
response in opposition on November 12, 2015. ECF No. 179. The
motion has been fully briefed and is now ripe for the
judgment shall be granted "if the pleadings, the
discovery and disclosure materials on file, and any
affidavits show that there is no genuine dispute as to any
material fact and that the movant is entitled to judgment as
a matter of law." Fed.R.Civ.P. 56(c). "By its very
terms, this standard provides that the mere existence of some
alleged factual dispute between the parties will not defeat
an otherwise properly supported motion for summary judgment;
the requirement is that there be no genuine issue of material
fact." Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 247-48 (1986). "Only disputes over facts that
might affect the outcome of the suit under the governing law
will properly preclude the entry of summary judgment."
Id. at 248. "[S]ummary judgment will not lie if
the dispute about a material fact is ‘genuine, ’
that is, if the evidence is such that a reasonable jury could
return a verdict for the nonmoving party." Id.
the summary judgment stage the judge’s function is not
himself to weigh the evidence and determine the truth of the
matter but to determine whether there is a genuine issue for
trial." Id. at 249. When the party moving for
summary judgment does not bear the ultimate burden of
persuasion at trial, it may discharge its burden by
demonstrating to the court that there is an absence of
evidence to support the non-moving party’s case.
Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).
The non-movant must then "make a showing sufficient to
establish the existence of an element essential to that
party’s case, and on which that party will bear the
burden of proof at trial." Id. at 322. The
court should view the evidence in the light most favorable to
the non-moving party and draw all inferences in its favor.
Anderson, 477 U.S. at 255.
argues that the court should grant its motion for summary
judgment because: (1) the Ruths did not assign Kehagias any
claims they may have had against Brown; (2) there is no
evidence that Hull or Brown owed the Ruths a duty; (3) the
Ruths failed to mitigate their damages; (4) the Ruths were
comparatively negligent; and (5) neither Brown nor Hull had a
duty to exercise good faith ...