United States District Court, D. Montana, Great Falls Division
MORRIS, UNITED STATES DISTRICT COURT JUDGE
Junkermier, Clark, Campanella, Stevens P.C.
(“JCCS”), Draggin' Y Cattle Company, Inc.
(“Draggin' Y”), and Roger and Carrie Peters
“Defendants”) have filed a motion for judgment on
the pleadings, or in the alternative, a motion to stay the
proceedings pending the state court remand proceedings in
accordance with Draggin' Y Cattle Co. v. Junkermier,
Clark, Campanella, Stevens, P.C., 439 P.3d 935 (Mont.
2019) (“Draggin' Y IV”).
New York Marine and General Insurance Company
(“NYM”) filed this action for declaratory
judgment and breach of contract regarding an insurance policy
with its insured, JCCS. (Doc. 1.) JCCS executed a $10, 000,
000 stipulated judgment in favor of Defendants Draggin' Y
and Peters to settle a professional malpractice lawsuit filed
in state court. Id. NYM seeks a declaration that it
remains not liable for the stipulated judgment. Id.
at 12. NYM claims that it possesses no further duties to its
insured, JCCS. Id. at 13. NYM alleges that it holds
no obligation to pay the stipulated judgment based on
JCCS's breach of the terms and conditions of its
insurance policy. Id.
filed a Rule 12(c) Motion for Judgment on the Pleadings and
an Alternative Motion to Stay Proceedings on May 22, 2019.
(Doc. 307.) Defendants ask the Court to take judicial notice
of the recent Montana Supreme Court decision in
Draggin' Y IV. (Doc. 301.) Defendants contend
that Draggin' Y IV affirmatively controls the
issues pending in this case. Id. at 2. NYM filed a
Motion in Opposition to the Motion for Judgment on the
Pleadings and requested that this Court grant emergency
relief. (Doc. 321.)
Court conducted a hearing on these motions on June 11, 2019.
(Doc. 307.) For the reasons discussed below, the Court denies
Defendants' motion for judgment on the pleadings and
similarly refuses to stay these proceedings.
may issue a judgment on the pleadings after the pleadings
have closed, but not within such time as to delay trial.
Fed.R.Civ.P. 12(c). A court must assume as true the
allegations contained in the nonmoving party's pleadings.
Rubin v. United States, 904 F.3d 1081, 1083 (9th
Cir. 2018). In order for a party to prevail on a 12(c) motion
a complaint must lack a cognizable legal claim or fail to
allege facts sufficient to support a cognizable legal theory.
Dworkin v. Hustler Magazine Inc., 867 F.3d 1188,
1192 (9th Cir. 1989); Balistreri v. Pacifica Police
Dep't, 901 F.2d 696, 699 (9th Cir. 1988). A court
must resolve all doubts in favor of the nonmoving party.
Religious Tech Ctr. v. Netcom On-Line Comm. Svcs.,
Inc., 907 F.Supp 1361, 1381 (N.D. Cal. 1995) (citing
Hal Roach Studios v Richard Feiner & Co., 896 F.2d
1542, 1550 (9th Cir. 1990)).
may stay its proceedings at its discretion. District courts
possess the inherent power to control their dockets and
promote the efficient use of their resources. Landis v.
North American Co., 299 U.S. 248, 254 (1936). A party
that seeks a stay “must make clear the hardship or
inequity in being required to go forward.” Id.
at 255. And “only in rare circumstances will a litigant
in one cause be compelled to stand aside while a litigant in
another settles the rule of law that will define the rights
of both.” Id.
Ninth Circuit has refined the standards for granting a stay.
Western Sec. Bank v. Schneider Ltd. P'ship, No.
CV-15-10-BLG-SPW-CSO, 2015 WL 2127211 (D. Mont. May 6, 2015).
“[S]tays should not be definite in nature and should
not be granted unless it appears likely the other proceeding
will be concluded within a reasonable time.”
Id. at *8 (citing Dependable Highway Express, Inc.
v. Navigators Ins. Co., 498 F.3d 1059, 1066 (9th Cir.
2007)). A court may “appropriately enter stay orders
where a party seeks only damages, does not allege continuing
harm, and does not seek injunctive or declaratory relief
since a stay would result only in delaying monetary
recovery.” Western Sec. Bank at *8 (citing
Lockyer v. Mirant Corp., 398 F.3d 1098, 1110 (9th Cir.
2005)). A stay remains appropriate if resolution of issues in
the other proceeding may assist in resolving the proceeding
sought to be stayed. Western Sec. Bank at *8
(citing Lockyer at 1110-1111). A stay proves
appropriate “for courts' docket efficiency and
fairness to the parties pending resolution of independent
proceedings that bear upon the case.” Western Sec.
Bank at *8-9 (citing Leyva v. Certified Grocers of
California, Ltd., 593 F.2d 857, 864 (9th Cir.1979)).
assert that the Montana Supreme Court decision in
Draggin' Y IV somehow defeats NYM's
declaratory judgment. (Doc. 308 at 14.) Defendants argue that
the Court must dismiss NYM's breach of contract claim.
Id. at 16. NYM intervened as party in
Draggin' Y IV on appeal to challenge the state
district court's reasonableness determination of the
underlying stipulated judgment. Draggin' Y IV,
439 P.3d at 904. Defendants contend that NYM effectively
rendered the issues presented in this declaratory judgment
action in federal court interdependent and inseparable from
the state court proceedings. (Doc. 308 at 14-16.) In
particular, Defendants point to NYM's efforts to
challenge the reasonableness and enforceability of the
stipulated judgment in Draggin' Y IV.
counters that Draggin' Y IV did not affect its
declaratory judgment or breach of contract claims as these
claims remain separate and independent from the state court
proceedings. (Doc. 321 at 12-13.) NYM asserts that the
Draggin' Y IV addressed a tort action between
Draggin' Y and JCCS. Id. This federal case
remains a declaratory judgment and breach of contract claim
brought by NYM against Defendants. Id. NYM contends
that Draggin' Y IV did not address any issues
regarding its liability to JCCS or the other Defendants.
Id. at 14.
law provides to an insured an independent cause of action
against its insurer for violations of its duties. Mont. Code.
Ann. § 33-18-242(1). Under Montana's Unfair Trade
Practices Act (“UTPA”) an insurer cannot be
liable “if the insurer had a reasonable basis in law or
fact for contesting the claim or the amount of the
claim.” Mont. Code. Ann. § 33-18-242(5). Such
determinations remain a question of fact and the insured
possesses the burden to prove a violation of the UTPA.
Draggin' Y IV, 439 P.3d at 942 (citations
omitted). In addition to providing a private cause of action
for violations of certain duties ...