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Sunflower Condominium Association, Inc. v. Auto-Owners Insurance Co.

United States District Court, D. Colorado

October 9, 2018

SUNFLOWER CONDOMINIUM ASSOCIATION, INC., a Colorado nonprofit corporation, Plaintiff and Counterclaim Defendant,
OWNERS INSURANCE COMPANY, Defendant and Counterclaimant.


          William J. Martínez United States District Judge

         Defendant Owners Insurance Company brings counterclaims against Plaintiff Sunflower Condominium Association, Inc. for breach of contract and recoupment. The Court has explained the relevant factual and legal background of this case in detail in other recent Orders, and familiarity with that background is presumed. (See, e.g., ECF No. 149.) Now before the Court are Plaintiff's Motion in Limine (ECF No. 159 (“Plaintiff's Motion”)) and Defendant's Motion in Limine (ECF No. 160 (“Defendant's Motion”)). For the reasons explained below, each motion is granted in part and denied in part.


         A. Dismissal of Plaintiff's Affirmative Claims Against Defendant

         Plaintiff moves for a pretrial order precluding Defendant, its witnesses, and its counsel from mentioning that Plaintiff had previously filed affirmative claims against Defendant and that these claims were dismissed by the Court. (ECF No. 159 at 2.) Plaintiff argues that such evidence is irrelevant and prejudicial pursuant to Fed.R.Evid. 401, 402, and 403.

         In its Response to Plaintiff's Motion in Limine (ECF No. 174 (“Defendant's Response”)), Defendant contends that the Court's dismissal of Plaintiff's claims is relevant because it refutes Plaintiff's contention that Plaintiff was excused from contractual performance. (ECF No. 174 at 1.)

         Plaintiff's Motion regarding the dismissal of its affirmative claims against Defendant is granted to the extent that the Court will inform the jury in a generic manner that Plaintiff initiated this lawsuit but that its affirmative claims are no longer at issue in the case. Defendant and its counsel are precluded, however, from referring to the dismissal of Plaintiff's claims and in particular, the manner in which they were disposed of. Additionally, Defendant's counsel is ordered to instruct their witnesses to not refer to the dismissal of Plaintiff's claims or the manner in which they were ruled on in this case.

         B. Expert Stephen Plitt's Testimony

         Plaintiff argues that Defendant should be prohibited from calling its expert, Stephen Plitt (“Plitt”), because his testimony is now irrelevant and prejudicial. (ECF No. 159 at 2.) Defendant had originally designated Plitt as an expert to support its defense against Plaintiff's claims. (Id. at 3.) Specifically, his affirmative expert report opined on the reasonableness of Defendant's actions in processing and handling the insurance claims. (Id.) Thus, his opinions in the original expert report all related directly to Plaintiff's claims, which are no longer in the case. (Id.) Plitt later filed a supplemental expert report based on his review of two other experts' opinions. (Id.) In this report, Plitt provided a preliminary opinion regarding the reasonableness of Defendant's breach of contract claim. (Id.) However, Defendant did not designate Plitt as an expert in support of its counterclaims. (Id.) Thus, Plaintiff argues that because its affirmative claims have been dismissed, Plitt's opinions related to those claims must be excluded at trial, because they have no bearing on the specific factual elements in the remaining claims. (Id.)

         In its Response, Defendant argues that many of Plitt's opinions remain relevant and admissible. (ECF No. 174 at 1.) Defendant intends to prove that Plaintiff acted intentionally when it made misrepresentations in the claim process because it was engaging in what it has characterized as morally hazardous behavior. (Id. at 2.) Plitt identifies the concept of opportunistic moral hazard in his disclosed opinions and presents the 4% special projects fee as an example. (Id.) Thus, Defendant argues, Plitt “should be permitted to testify and explain the concept of moral hazard to the jury.” (Id.) Defendant claims that it “would be helpful for lay jurors to hear an insurance-industry expert explain and describe the meaning of moral hazard and the role of the policy's fraud clause in fighting it.” (Id.)

         The Court does not find Defendant's argument persuasive with respect to Plitt's testimony. Defendant designated Plitt as an expert to defend against Plaintiff's bad faith claims, and these claims are no longer part of this case. Of equal import is the fact that a lay jury can easily understand the concept of moral hazard, even if the jurors have not heard the specific phrase “moral hazard, ” without the testimony of an expert witness to instruct them on the term. Accordingly, the Court grants Plaintiff's Motion and will preclude Defendant from calling Plitt as an expert witness at trial.

         C. Documentation or Testimony Related to the Repair of Plaintiff's Roofs Prior to the September 2014 Date of Loss

         Plaintiff argues that Defendant should be prohibited from introducing into evidence any documentation or testimony related to bids for, or work completed on, the repair and/or replacement of Plaintiff's roofs prior to the September 2014 date of loss. (ECF No. 159 at 6.) In 2007, Plaintiff hired Hammer Property Services to replace some of the sloped roofs in the community. (Id. at 7.) In 2014, Plaintiff received a bid from Kieft Construction to conduct work on a flat roof on Plaintiff's property. (Id.) Defendant intends to use this evidence to show that Plaintiff tried to charge Defendant significantly more than the actual cost of the roofs. (ECF No. 174 at 2.)

         Plaintiff argues that such evidence is irrelevant to the claims at hand, because there “is simply no way to properly compare” the scope of the work on the pre-September 2014 invoices and bids to the scope of the repair required after the 2014 storm which gave rise to this insurance claim. (ECF No. 159 at 7.) Plaintiff further argues that there is also no way to compare the unit pricing on the pre-September 2014 invoices to the unit pricing in their present estimate, because the pre-September 2014 estimates contain less detail than the present estimate. (Id.) For example, the Hammer Property Services pre-September 2014 estimate includes a single line item indicating that Hammer completed “the removal and replacement of roof and four skylights.” (Id.) It does not specify whether this included work on the HVAC units, doors, handrails, gutters, etc., whereas ...

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