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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 1 of 7

1 Greg S. Como, SB# 013187 como@lbbslaw.com


Adam S. Polson, SB# 022649 polson@lbbslaw.com
2 LEWIS BRISBOIS BISGAARD & SMITH LLP
Phoenix Plaza Tower II
3 2929 North Central Avenue, Suite 1700
Phoenix, Arizona 85012-2761
4 Telephone: 602.385.1040
Facsimile: 602.385.1051
5 Attorneys for Defendant ACE American Insurance Co.

6 UNITED STATES DISTRICT COURT


7 DISTRICT OF ARIZONA
8 U-Haul International, Inc., a Nevada No. 10-cv-886
Corporation,
9
Plaintiff, DEFENDANT’S SEPARATE
10 STATEMENT OF FACTS IN
vs. SUPPORT OF ITS MOTION FOR
11 PARTIAL SUMMARY JUDGMENT
ACE American Insurance Co., a
12 Pennsylvania Corporation,
13 Defendant.
14
Pursuant to LRCiv 56.1(a), ACE American Insurance Company (“ACE”) hereby
15

16 presents its Separate Statement of Facts in support of its Motion for Partial Summary

17 Judgment:
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1. On or about June 16, 2006, UHI and Cequent entered into a “Products
19
Indemnification Agreement.” Paragraph 4 of the Products Indemnification
20

21 Agreement provides as follows:

22 Supplier [Cequent] represents and warrants that it has products


23
liability insurance and commercial general liability insurance
with commercially reasonable limits in effect at the time of
24 execution of this Agreement and if so required by [UHI], that
[UHI] will be named as an additional insured on either of those
25 policies. [Cequent] shall deliver to [UHI], within thirty (30)
26 days of the execution of this Agreement, a copy of the
certificates of such insurance policies. Furthermore, [Cequent]
27 agrees that it will not materially decrease or eliminate the
28
coverages of such insurance policies without first giving thirty
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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 2 of 7

1 (30) days prior written notice to UHI.


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(Products Indemnification Agreement at ¶ 4, attached as Exhibit 1).
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2. ACE issued a commercial general liability policy to TriMas/Cequent, effective from
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June 30, 2008, through June 30, 2009, at policy HDO G23743735. (“ACE’s CGL

6 Policy” attached as Exhibit 2; UHI Complaint at ¶ 8 (Exhibit 1 to Dkt. # 1)).


7 3. ACE issued a products-completed operations policy to TriMas/Cequent, effective
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from June 30, 2008, through June 30, 2009 at policy HDO G23743693. (“ACE’s
9
Products Policy” attached as Exhibit 3; UHI Complaint at ¶ 7 (Exhibit 1 to Dkt. #
10

11 1)).
12 4. ACE issued a commercial umbrella liability policy to TriMas/Cequent at XOO
13
G24638509 effective from June 30, 2008, through June 30, 2009. (“ACE’s Excess
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Policy” attached as Exhibit 4; UHI Complaint at ¶ 9 (Exhibit 1 to Dkt. # 1)).
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16 5. A Vendor’s Endorsement to ACE’s Products Policy provides coverage to any


17 vendor whom Cequent has agreed to include as an additional insured. (ACE’s
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Products Policy at Endorsement Number 24, attached as Exhibit 3).
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6. A wrongful death lawsuit was filed by Knowledge Chenyika on September 1, 2009,
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21 as the personal representative of the Estates of Daniel Jamela and Marigold Jamela,
22 and as the guardian and conservator of Mishael Jamela and Mariel Jamela (“the
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Jamela lawsuit”). (Jamela Complaint, attached as Exhibit 5). The named
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defendants in the Jamela lawsuit are UHI, Amerco, Inc., and U-Haul Co. of
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26 Nebraska. (Id.)
27 7. The Jamela lawsuit alleges that Mr. Jamela contacted U-Haul West Maple to obtain
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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 3 of 7

1 equipment to move his family belongings from Omaha to Dallas. (Jamela


2
Complaint at ¶ 8, attached as Exhibit 5). Mr. Jamela allegedly rented a 12 foot
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cargo trailer from the U-Haul defendants and also purchased from them a trailer
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hitch and other towing equipment. (Id.) The U-Haul defendants allegedly attached

6 the towing equipment and trailer to Mr. Jamela’s 2005 Honda Pilot. (Id.)
7 8. Cequent manufactured the trailer hitch sold to Mr. Jamela. (UHI Complaint at ¶ 17
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(Exhibit # 1 to Dkt. # 1)).
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9. On July 1, 2008, Mr. Jamela was operating a 2005 Honda Pilot on Interstate 435 in
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11 Kansas. (Jamela Complaint at ¶ 16, attached as Exhibit # 5). Mr. Jamela


12 apparently lost control of his vehicle, crossed the highway median, and collided
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head-on with a Peterbilt diesel tractor. (Id.) Mr. Jamela and his wife, Mrs. Jamela,
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died as a result of the accident. (Id.)
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16 10. Plaintiff in the Jamela lawsuit alleges various acts or omissions that potentially
17 caused the fatal accident, including:
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• UHI, Amerco, Inc., and U-Haul Co. of Nebraska represented that all
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equipment was in working order, was suitable for the 2005 Honda Pilot, and

21 the equipment could be safely towed behind the vehicle (Jamela Complaint
22 at ¶ 9, attached as Exhibit 5);
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• The Gross Vehicle Weight Rating of the loaded trailer exceeded the
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25 maximum applicable trailer weight specified by Honda (Jamela Complaint at

26 ¶ 10, attached as Exhibit 5)


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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 4 of 7

1 • The trailer hitch that was sold was too small to safely tow the trailer (Jamela
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Complaint at ¶ 11, attached as Exhibit 5);
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• The tires on the trailer were underinflated, and the air pressure varied
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5 considerably amongst the tires (Jamela Complaint at ¶ 12, attached as

6 Exhibit 5);
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• The brakes on the trailer did not function correctly and/or did not function at
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all (Jamela Complaint at ¶ 13, attached as Exhibit 5); and
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10 • The trailer lights and/or electrical system were non-functional (Jamela

11 Complaint at ¶ 14, attached as Exhibit 5).


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11. Plaintiff in the Jamela lawsuit states the following counts against UHI, Amerco,
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Inc., and U-Haul Co. of Nebraska: (1) negligence; (2) strict liability; (3) failure to
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15 warn—speeds; (4) failure to warn—tow vehicle; (5) wrongful death; (6) survival

16 action; (7) negligent infliction of emotional distress—Mishael Jamela; and (8)


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punitive damages. (Jamela Complaint at ¶¶ 18-59, attached as Exhibit 5).
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12. On March 22, 2010, UHI filed the present action against ACE. UHI alleges that it
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20 is an additional insured on the ACE Policies, and is entitled to be defended and

21 indemnified by ACE for the Jamela lawsuit. (UHI Complaint at ¶¶ 8, 32) (Exhibit #
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1 to Dkt. # 1). UHI seeks declaratory relief as to whether ACE has a duty to defend
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UHI. (UHI Complaint at ¶ 29) (Exhibit # 1 to Dkt. # 1). UHI also alleges that ACE
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25 breached its obligations by failing to provide a defense under the ACE Policies.

26 (UHI Complaint at ¶ 34) (Exhibit # 1 to Dkt. # 1). UHI further alleges that ACE did
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not timely respond to UHI's request for defense, and that UHI has been prejudiced
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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 5 of 7

1 because UHI did not accept the tender of defense. (UHI Complaint at ¶¶ 38-39)
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(Exhibit # 1 to Dkt. # 1).
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13. Under ACE’s Products Policy, Cequent has a $1,000,000 self-insured retention.
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(ACE’s Product Policy at Endorsement Number 2, attached as Exhibit 3). Cequent

6 is responsible for paying the first $1 million in defense costs, settlements, or


7 judgments for claims arising under the Policy. (Id.)
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14. Endorsement Number 2 to ACE’s Products Policy provides in part as:
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You [Cequent] and we [ACE] mutually agree that the Claim
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Service Organization shown in the Schedule [ESIS, Inc.] will
11 provide investigation, administration, adjustment, and
settlement services, and will provide for the defense of all
12 claims or “suits” arising under this policy. Accordingly, you
13 agree with us that we shall have no duty to defend any such
“suit”, [nor] to pay any “allocated loss adjustment expense”
14 with respect to such claim or “suit” except as provided in
paragraph 4 below.
15

16 (ACE’s Products Policy, Endorsement Number 2 at ¶ 2, attached as Exhibit 3) (emphasis


17 added).1
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15. Under ACE’s Products Policy, if the amount of the judgment or settlement exceeds
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the $1,000,000 deductible, all “Allocated Loss Adjustment Expense” (i.e., defense
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21 costs), is paid by the insured and ACE in the same proportion as the amount each
22 contributed to the judgment or settlement. ACE’s Products Policy, Endorsement
23
Number 2 at ¶ 4, attached as Exhibit 3). However, if the judgment or settlement
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does not exceed the deductible, or if the claim or suit is settled without payment of
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26 damages, all “Allocated Loss Adjustment Expense” is borne solely by the named
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1
28 ACE's CGL Policy has a nearly identical provision in Endorsement Number 2.
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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 6 of 7

1 insured (Cequent). (Id.)


2
16. ACE’s CGL Policy excludes coverage for liability arising from the Products-
3
Completed Operations hazard. (ACE's CGL Policy, Endorsement Number 28,
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attached as Exhibit 2).

6 17. ACE's CGL Policy has a nearly identical provision to Endorsement Number 2 of the
7 Products Policy at its Endorsement Number 2. (ACE’s CGL Policy, Endorsement
8
Number 2, attached as Exhibit 2).
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18. With respect to ACE’s Excess Policy, ACE’s duty to defend UHI is limited to three
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11 situations: (1) when damages are covered by “underlying insurance” but the limits
12 are exhausted by payment; (2) when damages are covered by “other insurance” (i.e.,
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policies not listed on ACE’s Excess Policy) but the “other insurance” is exhausted
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by payment; and (3) when there is no coverage under the “underlying insurance” or
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16 “other insurance,” and the applicable self-insured retention under ACE’s Excess
17 Policy has been exhausted. (ACE’s Excess Policy at ¶ III(A)(1-3), attached as
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Exhibit 4).
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19. Under ACE’s Excess Policy section entitled “Who is an Insured,” the Policy defines
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21 as an insured “[a]ny person or organization, if insured under ‘underlying insurance’,


22 provided that coverage provided by this policy for any such insured will be no
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broader than coverage provided by ‘underlying insurance.’" (ACE’s Excess Policy
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at II(B)(1)(b)(6), attached as Exhibit 4).
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Case 2:10-cv-00886-ROS Document 18 Filed 07/15/10 Page 7 of 7

1 RESPECTFULLY SUBMITTED July 15, 2010.


2
LEWIS BRISBOIS BISGAARD & SMITH LLP
3

4 By ___/s/Adam S. Polson ______________________


Greg S. Como
5 Adam S. Polson
Attorneys for ACE American Insurance Company
6 CERTIFICATE OF SERVICE
7
I hereby certify that on July 15, 2010, I electronically transmitted the
8 foregoing document to the Clerk’s office using the Court's CM/ECF System and thereby
served all counsel of record in this matter.
9

10 /s/ Danielle Strickland

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