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Nautilus Insurance Co. v. 93 Lounge Inc.

United States District Court, E.D. New York

March 31, 2017

NAUTILUS INSURANCE COMPANY, Plaintiff,
v.
93 LOUNGE INC., LUIS RODRIGUEZ, EILEEN P. HUGHES, and CHARLES AMADO, JR., Defendants. NAUTILUS INSURANCE COMPANY, Plaintiff,
v.
93 LOUNGE INC., ASHLEY ENCALADA, VANESSA ENCALADA, EILEEN P. Hughes, and CHARLES AMADO, JR. Defendants.

          MEMORANDUM AND ORDER

          KIYO A. MATSUMOTO, United States District Judge.

         Plaintiff Nautilus Insurance Company (“plaintiff” or “Nautilus”) commenced a diversity action on February 18, 2014, against defendants 93 Lounge Inc. (“93 Lounge”), Luis Rodriguez, Eileen P. Hughes and Charles Amado, Jr. Nautilus commenced a second diversity action on January 13, 2015, against 93 Lounge, Ashley Encalada, Vanessa Encalada, Eileen P. Hughes and Charles Amado, Jr. The two actions were consolidated on June 23, 2016. All defendants except 93 Lounge have been dismissed.

         Presently before the court is Nautilus' motion for summary judgment. (Motion for Summary Judgment, ECF Nos. 37, 45.) Nautilus seeks a declaratory judgment pursuant to 28 U.S.C. § 2201 declaring that: a) it has no duty to defend or indemnify 93 Lounge or any party with respect to the claims in two lawsuits filed in the Supreme Court of New York, Kings County related to a motor vehicle accident that occurred on January 1, 2013, on 93rd street in Kings County, New York; b) it has no duty to pay Luis Rodriguez, Ashley Encalada, Vanessa Encalada, 93 Lounge or any party for any medical expenses with respect to Luis Rodriguez's, Ashley Encalada's or Vanessa Encalada's alleged injuries; c) and for its costs of suit incurred herein, including reasonable attorneys' fees. For the reasons set forth below, the Nautilus' motion for summary judgment is granted, except as to attorneys' fees.

         Background

         Rule 56.1 of the Local Civil Rules of the United States District Courts for the Southern and Eastern Districts of New York (“Local Rule 56.1”) requires a party moving for summary judgment to submit a statement of the undisputed facts on which the moving party relies to grant summary judgment, together with citation to the admissible evidence of record supporting each such fact. See Local Rule §§ 56.1(a), (d). The facts described below have been taken from the plaintiff's Rule 56.1 statement. (See Plaintiff's Rule 56.1 Statement (“Pl's. 56.1”), ECF No. 46.). Defendants have not opposed the motion and therefore did not submit opposing Rule 56.1 statements. Accordingly, based on the court's review of the plaintiff's 56.1 Statement and supporting exhibits, the court finds that the facts set forth in plaintiff's Rule 56.1 statement are deemed admitted. Giannullo v. City of N.Y., 322 F.3d 139, 140 (2d Cir. 2003) (“If the opposing party then fails to controvert a fact so set forth in the moving party's Rule 56.1 statement, that fact will be deemed admitted.”) (citing Local Rule 56.1(c)); see also Vermont Teddy Bear Co., Inc. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004) (holding district court was required to decide whether movant for summary judgment was entitled to judgment as matter of law even though motion was unopposed). The court resolves all conflicts in the evidence and draws all reasonable inferences in favor of defendant, the nonmoving party. See Smith v. Cty. of Suffolk, 776 F.3d 114, 121 (2d Cir. 2015) (“We ‘resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought.'”) (quoting Lederman v. N.Y.C. Dep't of Parks & Recreation, 731 F.3d 199, 202 (2d Cir. 2013)).

         Nautilus Insurance company issued a Commercial General Liability policy to 93 Lounge, under policy number NN212293 (the “Policy”) with effective dates of June 2, 2012 through June 2, 2013. (Pl's. 56.1, ECF No. 46 at ¶ 1.) Under the Policy coverage may be excluded on several bases.

         The first exclusion upon which plaintiff relies is the Liquor Liability exclusion. (Id. at 2.) The Liquor Liability exclusion in the Policy was amended by an endorsement to the Policy (S009 (02/95)), which removed language that limited the scope of the exclusion to insureds who were “in the business of manufacturing, distributing, selling, serving or furnishing alcoholic beverages.” (Compare Curran Aff., Ex. 1, ECF No. 47-1, Commercial General Liability Coverage Form (CG 00 0112 04) at 2 with Curran Aff. Ex. 3, ECF No. 47-3.) The endorsement reads as follows:

“Exclusion - Total Liquor Liability”
This endorsement modifies insurance provided under the following:
COMMERCIAL GENERAL LIABILITY COVERAGE PART
Exclusion c. under Paragraph 2., Exclusions of COVERAGE A. Bodily Injury and Property Damage (Section I - Coverages) is replaced by the following:
c. Liquor Liability
“Bodily injury” or “property damage” for which any insured or his indemnitee may be held liable by reason of:
(1) Causing or contributing to the intoxication of any person;
(2) The furnishing of alcoholic beverages to a person under the legal drinking age or under the influence of alcohol; or
(3) Any statute, ordinance or regulation relating to the sale, gift, distribution or use of alcoholic beverages.
All other Terms and Conditions of this Policy remain unchanged.
S009 (02/95)

(Curran Aff., Ex. 3, ECF No. 47-3 (emphasis in original).)

         Plaintiff also relies on the Aircraft, “Auto” or Watercraft exclusion. (Curran Aff., Ex. 4, ECF No. 47-4.) The Aircraft, “Auto” or Watercraft exclusion in the Policy was amended by an endorsement to the Policy, which removed references to the “insured.” (Compare Curran Aff., Ex. 1, ECF No. 47-1, Commercial General Liability Coverage Form (CG 00 0112 04) at 4 with Curran Aff. Ex. 4, ECF No. 47-4.) The endorsement reads as follows:

THIS ENDORSEMENT CHANGES THE POLICY PLEASE READ IT CAREFULLY
EXCLUSION - AIRCRAFT, AUTO OR WATERCRAFT
This endorsement modifies insurance provided under the ...

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