Case 4:10-cv-00744-TCK -PJC Document 1 Filed in USDC ND/OK on 04/28/10 Page 1 of 10

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF LOUISIANA LAFAYETTE/OPELOUSAS DIVISION ST. PAUL SURPLUS LINES INSURANCE COMPANY VERSUS CIVIL ACTION NO.

JUDGE

ACE AMERICAN INSURANCE COMPANY MAGISTRATE * * * * * * * ** * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ,'" * * * COMPLAINT

Plaintiff: St. Paul Surplus Lines Insurance Company ("St. Paul"), by and through undersigned counsel, hereby complains of Defendant, Ace American Insurance Company, and states its claims and causes of action as follows:

PARTIES, JURISDICTION AND VENUE
1.

S1. Paul Surplus Lines Insurance Company ("St. Paul" ), is a Delaware corporation with its principal place of business located at 385 Washington Street, St. Paul, Minnesota. 2. Defendant. Ace American Insurance Company ("Ace"). is a Pemlsylvania corporation with its principal place of business located at 436 Walnut Street. Philadelphia, Pennsylvania.

3.
This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. §1332(a) on the basis of diversity of citizenship jurisdiction and because the amount in controversy exceeds $75,000. This Court has personal jurisdiction over Ace because: (l) Ace is authorized to do and doing business in the State of Louisiana; (2) has appointed the Louisiana Secretary of

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State as its agent for service of process; and (3) actively solicits and issues policies of insurance to Louisiana residents.
4.

Venue is proper in this Court pursuant to 28 U.S.C. §1391(c).

GENERAL ALLEGATIONS

5.
On December 15, 2006, Margaret Connick CConnick"), f/k/a Margaret Drennan, a person of the full age of majority and a resident of Lafayette Parish, Louisiana, while in the course and scope of her employment with Petroquest Energy, L.L.c. ("Petroquest"), was involved in an automobile accident in Tulsa County, Oklahoma Cthe accident") while driving a rental car owned by Alamo Financing L.P.CAlamo") and/or Vanguard Car Rental USA, Inc. ("Vanguard"), causing serious and disabling injuries to Oklahoma resident Joy Helm, resulting in a lawsuit filed by Joy Helm and her husband against Connick and Petroquest in the District Court of Tnlsa County, State of Oklahoma, Case No. CJ-2007-1617 nhe lawsuit").
6.

The rental car driven by Connick at the time of the accident was rented to Connick by Alamo and/or Vanguard d/b/a Alamo Rent-a-Car, in Tulsa, Oklahoma on December 10,2006, and driven by Connick exclusively within the State of Oklahoma through the date of the accident on December 15, 2006.
7.

Pursuant to the AlamoN anguard rental agreement executed by Connick in Oklahoma, Connick purchased "Optional Alamo Protection Plus" insurance coverage for the rental vehicle, which provided Connick third party liability protection in an amount equal to the minimum

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financial responsibility limits applicable to the vehicle, and additional third party liability protection through an excess liability policy issued by Ace, with limits of the difference between the primary protection and a combined single limit of $1 ,000,000 per accident for bodily injury to others arising out of Connick's use or operation of the Alamo rental vehicle. 8. Alamo Financing L.P. submitted to the Oklahoma Department of Public Safety a Motor Vehicle Liability Owner's Security Form, indicating that at the time of the accident Alamo had self insured fleet coverage for the minimum liability limits per accident of $25,000 for death or mJury.
9.

At the time of the accident, pursuant to the primary and excess insurance arrangements by AlamolVanguard and Ace, COlmick was insured for up to $1,000,000 for the bodily injury and property damage claim pursued by Joy Helm against Connick. 10. Pursuant to its obligations under the insurance agreements, AlamolV anguard and Ace assumed Connick's defense and indemnity in the lawsuit without reservation of rights. Upon information and belief, the Alamo Financing L.P. self insured limits per accident of $25,000 had been exhausted by property damage payments and defense cost resulting from the accident and lawsuit.

II.
In an Amended Petition, Joy Helm added Petroquest as a defendant solely under the legal theory of respondeat superior since COlmick was in the course and scope of her employment with Petro quest at the time of the accident, a fact admitted by Petroquest in its Answer filed to the

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Amended Petition. 12. St. Paul had in effect on the date of the accident Policy No. MU05536396, insuring Petroquest, the named insured, and Connick as a permitted user of a rented auto, providing $1,000,000 of auto coverage on an excess basis for non-owned vehicles over any other collectible insurance.
13.

St. Paul assumed Petroquest's defense in the lawsuit, and then tendered Petroquest's defense and indemnity to AlamolVanguard and Ace in May 2007, which was rejected; AlamolVanguard and Ace also repeatedly refnsed Petroquest's request for copies of the applicable insurance agreements and policies for the rental car involved in the accident.
14.

On April 7, 2008, the District Court in the lawsuit granted Joy Helm's motion for partial summary judgment as to liability, finding that Connick was at fault in the accident and that Petroquest was vicariously liable with Connick as her employer, reserving for trial only the matter of damages.
15.

After extensive discovery on the damage issnes, with trial on the merits set for May 4, 2009, on April 29, 2009, St. Panl again tendered Petroquest's vicarious liability defense and indemnity to AlamolVangnard and Ace, with a demand that AlamolVanguard and Ace attempt settlement of the Plaintiffs'(Helm) claims within their $1,000,000 coverage limits, which they refused and/or ignored.

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16. Also on or about April 29, 2009, less than a week from trial, Joy Helm dismissed Connick from the lawsuit without prejudice, reserving Helm's vicarious liability claims against Petroquest. Under Oklahoma law, Joy Helm had one year from the dismissal to commence a new action against COlmick. Additionally, Petroquest, a vicariously liable employer, was entitled to indemnity under Oklahoma law against Connick, a malfeasant employee. 12 Okl. St. Ann. § 100;
Biggs v. Surrey Broadcasting Co., 1991 OK CIV APP 40, 811 P.2d 111, 114 (Okla. Civ. App. 1991); Burke v. Webb Boats, Inc., 2001 OK 83, 37 P.3d 811,814 (Okla. 2001); Porter v. NortonStuart Pontiac-Cadillac of Enid, 1965 OK 18,405 P.2d 109, 113-15 (Okla. 1965).
17.

Settlement negotiations were entered between Helm and St. Paul, resulting in a settlement on April 30, 2009 in the amount of $929,133.14, paid entirely by St. Paul. 18. Before the settlement was consummated, Alamo/Vanguard and Ace were advised of the status of the settlement negotiations and amounts being considered, and demand was again made for Alamo/Vanguard and Ace to assume the defense and indemnity of Petroquest, whose vicarious liability stemmed solely from Connick's negligence. Once settlement was confirmed, but prior to payment, demand was made against Alamo/V anguard and Ace for full payment of the settlement amount, well within the $1,000,000 of insurance coverage afforded by the Alamo/Vanguard and Ace insurance agreements, all of which was refused or ignored, with no e1Torts made to protect Connick against remaining viable claims wlder Oklahoma law. 19. On May 19, 2009, the full sum of $929,133.14 was paid by St. Paul to the Helm

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Plainti1Ts, in exchange for a full release of all claims against Connick, Petroquest, Alamo, Vanguard, Ace and St. Paul, but reserving to Petroquest and St. Paul all rights for indemnity, contribution or any available claim against Alamo, Vanguard and Ace. 20. The amount of the settlement was reasonable given the extent of damages sustained by .Joy Helm in the accident, including two back surgeries, past and future medical expenses, past loss wages and loss of future earning capacity, and resulting physical disability.

APPLICABLE SUBSTANTIVE LAW 21. Under both Oklahoma and Louisiana's conflict of law provisions, the laws of Oklahoma apply to the causes of action asserted herein since Oklahoma has the most significant relationship to the parties, the accident, and the contracts. Brickner v. Gooden, 1974 OK 91,525 P.2d 632, 637 (Okla. 1974); Restatement (Second) of Conflict of Laws §145 (1971); Bohannan v. Allstate

Insurance Co., 1991 OK 64, 820 P.2d 787,797; Aetna Cas. & Sur. Co. of Hartford, Conn., 132
P.2d 326; La.Civ.Code art. 3515 and 3537.

FIRST CAUSE OF ACTION (Subrogation) 22. St. Paul, as the insurer of Petroquest, a vicariously liable employer guilty of no independent acts of negligence, is entitled to reimbursement of the full sum of$929,133.14, paid in settlement of the Helms' claims, plus interest, and all cost, expenses and attorney fees

incurred in defending the lawsuit ("defense cost"), from Ace, the insurer of the solely negligent party, Connick, under the principles of legal or equitable subrogation, which requires placing the

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burden of bearing a loss where it ought to be. Sutton v. Jondahl, 532 P.2d 478, 482 (Okla.1975);
United States Fid. & Guar. Co. v. Federated Rural Elec. Ins. Corp., 2001 OK 81, 0-14 (Okla.

2001). 23. Alternatively, should it be determined that Petro quest is insured by Ace for the claims asserted against Petroquest in the lawsuit, St. Paul, as the excess insurer of Petroquest, is conventionally subrogated and entitled to full reimbursement of these sums paid in settlement and defense cost against Ace as the primary insurer of Petroquest. 24. Under the principles of legal or equitable subrogation, as well as conventional subrogation, S1. Paul, as the insurer of Connick, is entitled to full reimbursement of the sums paid in settlement, plus interest, against Ace as the primary insurer of Connick for the claims asserted in the lawsuit. 25. Alternatively, either under the principles of legal or equitable, or conventional subrogation, St. Paul is entitled to a proportionate reimbursement of the these sums.

SECOND CAUSE OF ACTION (Unjust Enrichment) 26.

Ace has been unjustly enriched by St. Paul's settlement of the Helm lawsuit, entitling St. Paul to full reimbursement of amounts paid in settlement and defense cost, plus interest, or alternatively, propOliionate reimbursement/contribution.

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THIRD CAUSE OF ACTION (Contribution)

27.

Alternatively, St. Paul is entitled to a proportionate reimbursement from Ace as the coinsurer/obligor of Connick for amounts paid in settlement, plus interest, under the principles of equitable contribution.
28.

Alternatively, should it be determined that Petro quest is insured by Ace for the claims asserted in the lawsuit, S1. Paul is entitled to a proportionate reimbursement from Ace as the coinsurer/obligor of Petro quest of amounts paid in settlement and defense cost, plus interest, under the principles of equitable contribution.
29.

8t. Paul request Ace to produce all applicable insurance agreements and policies covering the rental vehicle involved in the accident and as referenced in the rental agreement executed by COlmick.

WHEREFORE, premises considered, 81. Paul Surplus Lines Insurance Company, prays that after due proceedings are had, that there be judgment in favor of 8t. Paul against Ace American Insurance Company, for reimbursement of the full sum of $929,133.14, and all cost, expenses and attorney fees, plus interest, and for all damages reasonable in the premises, together with legal interest thereon from date of judicial demand until paid, for all eosts of these proceedings, and for all other equitable relief available.

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Respectfully submitted, JONES, WALKER, WAECHTER, POiTEVENT, CARRERE & DENEGRE, L.L.P.

s/Michael G. Lemoine MICHAEL G. LEMOINE, #8308 CARMEN M. RODRIGUEZ, #22573 Chase Tower 600 Jefferson Street, Suite 1600 Post Office Drawer 3408 Lafayette, LA 70502 Ph: (337) 262-9000 Fax: (337) 262-9001 Attorneys for Plaintiff, St. Paul Surplus Lines Insurance Company

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UNITED STATES DISTRICT COURT WESTERN DISTRICT OF LOUISIANA LAFAYETTE/OPELOUSAS DIVISION ST. PAUL SURPLUS LINES INSURANCE COMPANY VERSUS ACE AMERICAN INSURANCE COMPANY CIVIL ACTION NO.

JUDGE

MAGISTRATE

* * * * * * * ** * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
CERTIFICATE OF SERVICE I hereby certify that on April 28, 20 I 0, I electronically filed the foregoing with the Clerk of Court by using the CM/ECF system.

slMichael G. Lemoine MICHAEL G. LEMOINE, #8308 CAIUviEN M. RODRIGUEZ, #22573 JONES, WALKER, WAECHTER, POITEVENT, CARRERE & DENEGRE, L.L.P. Chase Tower 600 Jefferson Street, Suite 1600 Post Office Drawer 3408 Lafayette, LA 70502 Ph: (337) 262-9000 Fax: (337) 262-9001 Attorneys for Plaintiff, St. Paul Surplus Lines Insurance Company

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