United States District Court, E.D. Missouri, Eastern Division
COMMUNICATIONS UNLIMITED CONTRACTING SERVICES, INC.; CHARTER OAK FIRE INSURANCE COMPANY; and ST. PAUL FIRE & MARINE INSURANCE COMPANY, Plaintiffs,
BROADBAND INFRASTRUCTURE CONNECTION, LLC; and MID-CONTINENTAL CASUALTY COMPANY, Defendants.
MEMORANDUM AND ORDER
G. FLEISSIG UNITED STATES DISTRICT JUDGE.
diversity action seeking indemnification and equitable
contribution is before the Court on the motion of Plaintiff
Communications Unlimited Contracting Services
(“Communications Unlimited”) to dismiss the
counterclaim for indemnification filed by Defendant
Mid-Continent Casualty Company (“Mid-Continent”).
For the reasons set forth below, the Court will convert the
motion to a motion for summary judgment pursuant to Federal
Rule of Civil Procedure 12(d).
2007, a company named Communications Unlimited entered into a
Master Contractor Agreement with Charter Communications, Inc.
(“Charter”), under which Communications Unlimited
agreed to install cable services for Charter customers in
Missouri. ECF No. 1-5. In 2012, Communications Unlimited
entered into a Master Service Agreement with Defendant
Broadband Infrastructure Connection, LLC
(“Broadband”), setting forth terms under which
Broadband would perform cable installation work assigned to
it by Communications Unlimited. ECF No. 1-6. The Master
Service Agreement contained an “Insurance”
provision, requiring Broadband to obtain Commercial General
Liability Insurance, with coverage for a minimum amount of $1
million per occurrence, as well as Umbrella Excess Insurance
in the same amount. The Master Service Agreement obligated
Broadband to name Communications Unlimited as an additional
insured party under Broadband's policies. Id. at
21-22. Broadband obtained such insurance, with Mid-Continent
as the insurer.
Master Service Agreement between Communications Unlimited and
Broadband also contained an “Indemnification”
provision pursuant to which Broadband agreed to indemnify
Communications Unlimited for any claims and liabilities
arising out of, as relevant here, wrongdoing on the part of
any Broadband employee. Id. at 28-29.
Unlimited itself was insured under a Commercial General
Liability Policy issued by Plaintiff Charter Oak Fire
Insurance Company (“Charter Oak”), and an
Umbrella Excess Liability Policy issued by Plaintiff St. Paul
Fire & Marine Insurance Company (“St. Paul”).
September 23, 2014, Jane Doe filed an action in Missouri
state court for damages against Charter; Broadband;
Communications Unlimited; and James Helderle, a cable
technician. See ECF No. 39-2 at 21. Doe alleged in her first
amended petition that the three corporate defendants were
joint employers of Helderle, in that they each had the right
to control hiring, supervising, and firing him. ECF No. 1-7.
Doe alleged that Helderle came into contact with her
“through his employment and/or agency and/or
affiliation with” the three corporate defendants. She
alleged that he entered her apartment on December 2, 2012, to
perform technical cable services, and acted inappropriately.
Helderle was fired on December 4, 2012, based on Doe
reporting his inappropriate behavior, and was told the reason
for his termination. The next night he forced his way into
Doe's apartment and sexually assaulted her. Doe asserted
claims of negligent hiring, negligent supervision, and
negligent failure to warn against each of the three corporate
defendants, and a battery claim against Helderle.
in the present case made a demand upon Mid-Continent to
defend and indemnify Communications Unlimited in the Doe
action, but Mid-Continent denied the request. Communications
Unlimited alleges that on January 20, 2016, the three
Plaintiffs in the present case paid a confidential sum in
settlement of Doe's claims against Communications
Unlimited. Communications Unlimited now seeks indemnification
from Broadband (Count I), under the Master Service Agreement,
for the full amount of the Doe settlement plus expenses and
costs incurred in that action; and for the same amount from
Mid-Continent (Count II) for breach of the Broadband
insurance policies naming Communications Unlimited as an
additional insured. Charter Oak and St. Paul seek equitable
contribution against Mid-Continent (Count III).
filed a Counterclaim against Communications Unlimited in
which it states that (on or about January 3, 2017)
Mid-Continent settled Doe's claims against Broadband, its
insured, for a confidential amount. EFC. No. 36.
Mid-Continent further states that Broadband assigned
Broadband's rights against Communications Unlimited to
Mid-Continent, with respect to the amount paid to settle
Doe's claims against Broadband. Mid-Continent alleges
that Communications Unlimited was the corporate party that
was solely responsible for, and at fault in, hiring and
supervising Helderle, in that Communications Unlimited
“completely dominated all operations of Broadband . . .
includ[ing] complete control regarding hiring, training,
supervision, disciple and firing of employees.” More
specifically, Mid-Continent alleges that “[i]t was
employees or officers of [Communications Unlimited] who hired
Helderle and were responsible for his training, job
assignment and supervision.” Id. at 5-6.
Mid-Continent claims that, as such, Communications Unlimited
is liable to Mid-Continent for contribution or indemnity for
the amount Mid-Continent paid to settle Doe's claims
OF THE PARTIES
support of its motion to dismiss Mid-Continent's
counterclaim, Communications Unlimited argues that
Mid-Continent's claims for contribution or noncontractual
indemnity are barred pursuant to Mo. Rev. Stat. §
537.060, by virtue of Communications Unlimited's
settlement of Doe's claim against it. Section 537.060
provides as follows:
When an agreement by release . . . is given in good faith to
one of two or more persons liable in tort for the same injury
or wrongful death, such agreement shall not discharge any of
the other tort-feasors for the damage unless the terms of the
agreement so provide; however such agreement shall reduce the
claim by the stipulated amount of the agreement, or in the
amount of consideration paid, whichever is greater. The
agreement shall discharge the tort-feasor to whom it is given
from all liability for contribution or noncontractual
indemnity to any other tort-feasor. The term
“noncontractual indemnity” as used in this
section refers to indemnity between joint tort-feasors
culpably negligent, having no legal relationship to each
other and does not include indemnity which comes about by
reason of contract, or by reason of vicarious liability.
Unlimited submits with its motion to dismiss, a copy of the
January 28, 2016 voluntary dismissal with prejudice of
Doe's claims against Charter and Communications Unlimited
in the state case. ECF No. 39-1. Communications Unlimited
also submits a copy of the docket sheet in the Doe case, that
shows that on December 22, 2016, Doe filed a notice of her
dismissal with prejudice of the case against Broadband, which
was granted by the court on January 3, 2017. ECF No. 39-2.
According to the docket sheet, the order of dismissal stated
that the case “remained set for 1-6-17 to show cause
why the cause of action against James Helderle should not be
dismissed for failure to prosecute.” Id. The
next day Doe dismissed her claim against Helderle.
responds that the motion to dismiss its counterclaim should
be denied on both procedural and substantive grounds.
Procedurally, Mid-Continent argues that the motion must be
converted to one for summary judgment under Federal Rule of
Civil Procedure 12(d) because the motion relies on the
settlement agreement between Doe and Charter and
Communications Unlimited, and whether it was entered into in
good faith, matters outside the pleadings. Relatedly,
Mid-Continent argues that § 537.060 is an affirmative
defense on which ...