The Upper Deck Company v. Liberty Mutual Fire Insurance Co.
- Proceeding
- district
- Area
- civil
- Panel
- Myron James Lorenz (author)
Analysis
The court reviewed the status of an insurance coverage action that had been stayed pending the resolution of an underlying lawsuit, noting that the parties had failed to file required status reports and the stay had become open-ended. The court ordered the case administratively closed and directed the plaintiff to move to reopen or dismiss within 28 days of the underlying case's resolution.
| What the court decided | The model |
|---|---|
Administrative closure of the case“The Clerk shall administratively close this action.” | agree with court The court correctly applied the principle that open-ended stays are disfavored, citing Landis v. North American Co. The record shows the parties failed to comply with the specific conditions of the stay (filing status reports), rendering the stay indefinite. Administrative closure is a standard procedural mechanism to manage the docket in such circumstances, distinct from dismissal on the merits. |
Requirement to move to reopen or dismiss within 28 days of underlying judgment“No later than 28 days after judgment or dismissal of the Leaf action, Plaintiff shall either move to reopen or file a joint motion for dismissal. Failure to timely comply with this order will result in dismissal without prejudice pursuant to Federal Rule of Civil Procedure 41(b).” | agree with court This condition is reasonable and provides a clear path for the plaintiff to resume the case if the underlying litigation concludes. It protects the defendant from indefinite limbo while preserving the plaintiff's right to pursue the claim if the stay's purpose is fulfilled. |
The order itself: sound — The order is procedurally sound. It correctly identifies the failure of the parties to adhere to the terms of the stay (status reports) and the resulting open-ended nature of the stay. It cites the appropriate Supreme Court authority (Landis) to support the conclusion that open-ended stays are improper. The remedy (administrative closure with a specific trigger for reopening) is a standard and appropriate exercise of the court's inherent authority to manage its docket. The order clearly states that no judgment on the merits is entered.
Opinion
1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 SOUTHERN DISTRICT OF CALIFORNIA 9 10 THE UPPER DECK COMPANY, a Case No. 3:19-cv-0752-L-JLB Nevada corporation, 11 ORDER ADMINISTRATIVELY 12 Plaintiff, CLOSING CASE v. 13 14 LUBERTY MUTUAL FIRE INSURANCE CO., a Wisconsin 15 corporation, 16 Defendant. 17 18 19 Plaintiff filed this insurance coverage lawsuit seeking to compel Defendant to 20 cover the costs of litigation in a suit against Plaintiff, titled, Leaf Trading Cards, LLC 21 v. The Upper Deck Co., Case No. 3:17-cv-3200 (“the Leaf action”). On November 22 22, 2019, the Court granted the parties’ joint request to stay this action until the 23 resolution of the underlying Leaf action, currently pending in the United States 24 District Court, Northern District of Texas. [ECF No. 32.] The parties were ordered 25 to file status reports on the Leaf action every sixty (60) days and were directed to 26 notify this Court within 14 days after a decision is reached that case. 27 28 1 The parties regularly filed status reports until September 21, 2020, then 2 stopped filing reports. After six months passed with no status reports, the Court 3 issued an Order to Show Cause (“OSC”) why this action should not be dismissed for 4 failure to prosecute. [ECF No. 39.] 5 In response to the OSC, Plaintiff’s counsel filed a declaration stating that the 6 parties were proceeding with mediation before the COVID-19 pandemic struck, but 7 that in March 2020, discovery, motions, and hearings in the Leaf action were 8 cancelled or delayed, and the jury trial in Dallas, Texas was cancelled and 9 rescheduled several times, due to the pandemic. (Lowe Declaration at 2). The trial 10 is now scheduled for September 2021. (Id.) The parties are hopeful the case will settle, 11 but if not, the parties must wait for the conclusion of the Leaf action trial to determine 12 the issues in the present case. (Id.) The parties anticipate that the Leaf action will be 13 resolved within six months. 14 15 As noted above, the parties’ request for a stay was granted because it was 16 anticipated to be of limited duration and the parties agreed to file regular status 17 reports. Neither proved to be the case. The parties stopped filing status reports, and 18 the stay now appears to be open-ended. (ECF nos. 31, 32, 39). A court should not 19 grant an open-ended stay. Landis v. N. Am. Co., 299 U.S. 248, 255 (1936). 20 Accordingly, it is ordered as follows: 21 22 1. The Clerk shall administratively close this action. 23 2. No judgment will issue in connection with this administrative closure, 24 and this order does not constitute a decision on the merits. 25 26 3. No later than 28 days after judgment or dismissal of the Leaf action, 27 Plaintiff shall either move to reopen or file a joint motion for dismissal. Failure to 28 ! || timely comply with this order will result in dismissal without prejudice pursuant to 2 || Federal Rule of Civil Procedure 41(b). 3 IT IS SO ORDERED. 4 || Dated: June 4, 2021 1 (ae flap? 6 Hone. James Lorenz 7 United States District Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28