United States District Court, D. North Dakota
L. HOVLAND, CHIEF JUDGE
the Court is the Plaintiff AMCO Insurance Company's
(“AMCO”) motion for default judgment and summary
judgment filed on October 9, 2018. See Doc. No. 16.
Defendant KDAK, LLC (“KDAK”) filed a response in
opposition to the motion for summary judgment on October 30,
2018. See Doc. No. 18. AMCO filed a reply brief on
November 13, 2018. See Doc. No. 21. For the reasons
set forth below, the motion for default judgment is granted
and the motion for summary judgment is denied.
declaratory judgment action arises out of an insurance
coverage dispute between AMCO and its insureds, Defendants
Mike Lee and Vivian Tran, under a dwelling insurance policy
issued to Lee and Tran by AMCO, Policy No. ADP00426731690.
AMCO seeks a declaration that it is not required to defend or
indemnify Lee and Tran in relation to a North Dakota state
court civil action brought by Defendants Brandon Bell and
Casey Bell. The Bells allege unprivileged entry by Defendant
Stacy Ward and others into certain residential rental
property in Tioga, North Dakota, owned by Lee and Tran and
rented by the Bells. KDAK provided property management
services in relation to the rental property in question.
Defendant Stacy Ward was an employee of KDAK. KDAK and Ward
are not parties to the insurance policy issued to Lee and
Tran by AMCO. KDAK, Ward, Lee, and Tran are all named
defendants in the state court action. AMCO does not seek any
relief from or against KDAK and Ward but has named them as
they may be interested parties. KDAK is the only defendant to
answer the complaint and has filed a frivolous action
counterclaim along with its answer. AMCO seeks default
judgment against Defendants Mike Lee, Vivian Tran, Brandon
Bell, Casey Bell, and Stacy R. Ward a/k/a Stacy R. Knapp
(collectively referred hereinafter as the
“non-responsive Defendants”) and summary judgment
as to KDAK.
served a copy of the summons and complaint on each of the
non-responsive Defendants between April 26, 2018, and July
24, 2018. See Doc. Nos. 3, 4, 5, and 10. Such
service appears to be in compliance with Rule 4 of the
Federal Rules of Civil Procedure. The non-responsive
Defendants had twenty-one (21) days from the date of service
to file an answer or otherwise file a responsive motion.
See Fed.R.Civ.P. 12(a). To date, no answer has been
filed nor any appearance made on behalf of the non-responsive
Defendants. Having failed to defend or otherwise appear,
entry of default was made by the Clerk of Court against the
non-responsive Defendants, on September 25, 2018, as required
by Rule 55(a) of the Federal Rules of Civil Procedure.
See Docket No. 14.
Plaintiff's complaint, motion for default judgment, and
affidavits of Attorney Sean F. Marrin demonstrate that the
non-responsive Defendants have failed to appear or respond to
this action in any way. See Docket Nos. 1, 9, 12,
and 16. Accordingly, the Court GRANTS motion
for default judgment.
seeks summary judgment as to KDAK. AMCO states it sued KDAK
solely because KDAK is a defendant in the underlying state
court action and is thus a party in interest whose presence
was necessary. It is undisputed KDAK is not a party to the
underlying insurance policy and claims no interest in the
policy. Because KDAK is not a party to the insurance contract
at issue, AMCO maintains it is entitled to summary judgment
against KDAK declaring KDAK has no such interest.
the only defendant to file an answer in response to
AMCO's lawsuit. KDAK maintains AMCO's lawsuit against
it is frivolous and has filed a counterclaim on this basis.
It seeks dismissal of AMCO's lawsuit plus costs and
attorney's fees. However, KDAK did not file a motion to
Court questions whether it was really necessary for AMCO to
name KDAK as a defendant in this declaratory judgment action.
However, KDAK was named in the underlying action as a
defendant thus it is not outside the realm of possibility
that KDAK could arguably claim an interest in the policy.
KDAK has made it clear that it does not claim any interest in
the policy. Having no interest in the policy, KDAK need not
have responded to a complaint which sought no relief from it.
In addition, KDAK could have easily filed a motion to dismiss
rather than an answer. Under these circumstances the Court
cannot describe the complaint against KDAK as frivolous.
However, the complaint seeks no relief against KDAK either,
and on this basis the Court finds the complaint fails to
state a claim against KDAK. Dismissal on this basis is
warranted. AMCO certainly could have dismissed KDAK when
counsel for KDAK contacted counsel for AMCO after the summons
and complaint were served. Neither party is without fault
they must bear their own costs and fees.
reasons set forth above, AMCO's motion for default
judgment is GRANTED. AMCO's motion for
summary judgment is DENIED. AMCO's
complaint against KDAK is DISMISSED for
failure to state a claim upon which ...