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Hartford Casualty Insurance Co. v. Samuel Engineering, Inc.

United States District Court, D. Colorado

March 5, 2014

HARTFORD CASUALTY INSURANCE COMPANY, an Indiana corporation, Plaintiff,
v.
SAMUEL ENGINEERING, INC., a Colorado corporation, Defendant.

AMENDED ORDER AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

KATHLEEN M. TAFOYA, Magistrate Judge.

This matter is before the court on Defendant Samuel Engineering, Inc's "Unopposed Motion to Stay Proceedings on All Claims beyond Those Addressed in the Pending Cross-Motions for Summary Judgment." (Doc. No. 43, filed Jan. 21, 2014.)

BACKGROUND

This is a declaratory judgment action brought under 28 U.S.C. § 2201 for the adjudication of the parties' rights and duties under an insurance policy issued by Plaintiff Hartford Casualty Insurance Company ("Hartford") to Defendant Samuel Engineering, Inc. ("Samuel").

Samuel seeks coverage under a business-liability policy and an umbrella-liability policy ("the policies") relating to claims for which Samuel is the target in two different lawsuits pending in Ontario, Canada (the "Underlying Litigation").

In August 2012, Samuel sought liability insurance coverage from Hartford including defense and indemnification related to the Underlying Litigation. Hartford accepted Samuel's tender of the defense in the Underlying Litigation, under full reservation of rights, and has been defending Samuel since March 7, 2013.

On the same date, Hartford initiated this action seeking declaratory judgment as to its rights and duties under the policies, as well as alternative claims for rescission and reformation. Samuel brought counterclaims for bad-faith breach of insurance contract and violations of Colo. Rev. Stat. §§ 10-3-1115 and 1116.

The parties submitted Cross Motions for Summary Judgment seeking a judicial determination of whether Hartford owes Samuel a duty to defend. ( See Doc. Nos. 20 & 21.) Those Cross-Motions were fully briefed as of August 12, 2013. ( See Doc. Nos. 22 & 23) ( See also Sched. Order, Doc. No. 18 (summary judgment briefing to include simultaneous motions and responses).)

Samuel maintains that all of the remaining claims in this action depend on the facts as developed in the Underlying Litigation. Samuel represents that discovery in the Underlying Litigation will not begin until May or June 2014 and trial will not occur until late-2014, at the earliest. In this action, however, discovery was completed on December 26, 2013 and trial is set for April 2014. As such, Samuel requests a stay of all proceedings in this action until the conclusion of the Underlying Litigation.[1]

ANALYSIS

The Federal Rules of Civil Procedure do not expressly provide for a stay of proceedings. See String Cheese Incident, LLC v. Stylus Shows, Inc., 02-CV-01934-LTB-PA, 2006 WL 894955, at *2 (D. Colo. March 30, 2006) (unpublished). Nevertheless,

[t]he power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants. How this can best be done calls for the exercise of judgment, which must weigh competing interests and maintain an even balance.

Landis v. N. Am. Co., 299 U.S. 248, 254-55 (1936) (citing Kansas City S. Ry. Co. v. United States, 282 U.S. 760, 763 (1931)). A stay of proceedings is thus an appropriate exercise of this court's discretion. Id.

Additionally, a court may decide that in a particular case it would be wise to stay proceedings until certain challenges have been resolved. See 8A Charles Alan Wright, Arthur R. Miller & Richard L. Marcus, Federal Practice and Procedure § 2040, at 198 (3d ed. 2010). When considering a stay of proceedings, this court considers: (1) the plaintiff's interests in proceeding expeditiously with the civil action and the potential prejudice to plaintiff of a delay; (2) the burden on the defendants; (3) the convenience to the court; (4) the interests of persons not parties to the civil litigation; and (5) the ...


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