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Endurance American Specialty Insurance Co. v. L. Pellinen Construction, Inc.

United States District Court, M.D. Florida, Orlando Division

November 7, 2019

ENDURANCE AMERICAN SPECIALTY INSURANCE COMPANY, Plaintiff,
v.
L. PELLINEN CONSTRUCTION, INC.; MATTAMY HOMES CORPORATION; MATTAMY ORLANDO, LLC; and MATTAMY FLORIDA, LLC, Defendants.

          ORDER

          ROY B. DALTON JR. UNITED STATES DISTRICT JUDGE.

         Defendants Mattamy Homes Corporation, Mattamy Orlando LLC, and Mattamy Florida LLC (collectively, "Mattamy") move the Court to abstain from exercising jurisdiction over Plaintiffs declaratory judgment action and dismiss it. (Doc. 41 ("Motion").) Plaintiff responded. (Doc. 45.) On review, the Motion is due to be denied.

         I. Background

         This declaratory judgment action stems from a lawsuit in the Circuit Court of the Ninth Judicial Circuit in and for Orange County, Florida ("State Court Action"). See Granite State Ins. Co. v. L. Pellinen Constr., Inc., et al., No. 2017-CA-011094-O (Fla. Cir. Ct 2017). Mattamy owned and operated a development project involving the construction of a residential home in Kissimmee, Horida. (Doc. 39, pp. 19, 21, ¶¶ 21-26, 38-39.) L. Pellinen Construction ("Pellinen") was the general contractor for the project and managed the construction and framing of the home. (Id. at 21-22, ¶ 40.) Pellinen subcontracted with Hasan Heosig, Inc. ("Hasan") to complete the work. (Id. at 23, ¶ 47.)

         On December 22, 2016, Hasan employee Esdras Isaias Ambrocio's stood on a wooden truss to frame the roof of the home when, without warning, the truss splintered and broke, causing him to fall almost twenty feet and strike his head on a concrete slab below ("Accident"). (Id. at 23, ¶¶ 48-51.) Mr. Ambrocio suffered "catastrophic and life devastating injuries." (Id. at 23-24, ¶ 52.) Following the Accident, Hasan's workers' compensation carrier, Granite State Insurance Company ("Granite"), paid Mr. Ambrocio benefits over $800, 000 for his past and present medical and life care needs. (Id. at 25-26, ¶¶ 60-61.) Seeking to recover for the benefits paid to Mr. Ambrocio, Granite initiated the State Court Action, asserting a single count of negligence against Pellinen and Mattamy and several counts of negligence and strict liability against other entities that purportedly manufactured or supplied the wooden truss. (Id. at 26-44, ¶¶ 62-145.)

         This suit followed years later. Pellinen, the general contractor, had a commercial general liability insurance policy ("Policy") from Plaintiff Endurance American Specialty Insurance Company ("Endurance"), which it acquired before the Accident. (Id. at6, ¶ 25.) After the State Court Action arose, Endurance sued Pellinen and Mattamy in federal court, requesting the Court declare Endurance has no duty to defend or indemnify Pellinen, Mattamy, or any other party in the State Court Action due to exclusions in the Policy that preclude coverage ("Declaratory Judgment Action"). (Id. at 9-13, ¶¶ 27-51.)

         Mattamy now moves the Court to abstain from exercising jurisdiction and dismiss the Declaratory Judgment Action in favor of the pending State Court Action. (Doc. 41.) With Plaintiff's response (Doc. 45), the matter is ripe.

         II. Legal Standards

         The Declaratory Judgment Act allows federal courts to "declare the rights and other legal relations of any interested party seeking such declaration." 28 U.S.C. § 2201(a). It is "an enabling Act, which confers a discretion on the courts rather than an absolute right upon the litigant." Wilton v. Seven Falls Co., 515 U.S. 277, 287 (1995). "It only gives the federal courts competence to make a declaration of rights; it does not impose a duty to do so." Ameritas Variable Life Insurance Co. v. Roach, 411 F.3d 1328, 1330 (11th Cir. 2005) (citing Brillhart v. Excess Ins. Co. of America, 316 U.S. 491, 494 (1942)). With this discretion, the Supreme Court has stated that "it would be uneconomical as well as vexatious for a federal court to proceed in a declaratory judgment suit where another suit is pending in a state court presenting the same issues, not governed by federal law, between the same parties." Brillhart, 316 U.S. at 495. District courts must determine "whether the questions in controversy between the parties to the federal suit, and which are not foreclosed under the applicable substantive law, can better be settled in the proceeding pending in the state court." Id. District courts may "decline to entertain a declaratory judgment action on the merits when a pending proceeding in another court will fully resolve the controversy between the parties." Ven-Fuel, Inc. v. Dep't of the Treasury, 673 F.2d 1194, 1195 (11th Cir. 1982).

         Consistent with these precepts and "considerations of federalism, efficiency, and comity," the U.S. Court of Appeals for the Eleventh Circuit set forth a non-exhaustive list of factors for district courts to consider when determining whether to exercise jurisdiction over a declaratory action when parallel state proceedings are pending:

(1) the strength of the state's interest in having the issues raised in the federal declaratory action decided in the state courts;
(2) whether the judgment in the federal declaratory action would settle the controversy;
(3) whether the federal declaratory action would serve a useful purpose in clarifying the legal relations at issue;
(4) whether the declaratory remedy is being used merely for the purposes of 'procedural fencing' - that is, to provide an arena for res judicata or to achieve a ...

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