Judge Serena R. Murillo, Case Number: BC631370, Date: 2023-05-11 Tentative Ruling

Judge: Serena R. Murillo, Case: BC631370, Date: 2023-05-11 Tentative Ruling

Case Number: BC631370 Hearing Date: October 24, 2023 Dept: 31

TENTATIVE

Plaintiffs’ motion to strike GEICO's Motion for Summary Adjudication, or in the alternative, specific portions, is DENIED.

Background

On August 23, 2016, Plaintiffs Susan Abusamra-Pixler (hereinafter “Susan”) and Charles Pixler (hereinafter “Charles”) (collectively “Plaintiffs”) filed the instant action against Defendants U-Haul International, Inc; Government Employees Insurance Company; Geico General Insurance Company; Dawn M. Grant Insurance Services, Inc; FCA US LLC (f/k/a Chrysler Group, LLC); and Does 1 to 100. The Complaint asserts causes of action for: (1) Strict Products Liability; (2) Negligence; (3) Breach of Contract; (4) Breach of the Implied Covenant of Good Faith and Fair Dealing; (5) Declaratory Relief; (6) Negligent Infliction of Emotional Distress; (7) Violation of California Unfair Competition Law; and (8) Quasi-Contract/Unjust Enrichment.

This case stems from a single vehicle car accident involving a 2005 Jeep Liberty with a 1994 U-Haul Trailer in Riverside, California. Plaintiff Ms. Pixler was a passenger in the Jeep, which was insured by GEICO. The GEICO policy of insurance included underinsured motorist coverage. Plaintiffs’ action against GEICO is premised on the allegation that GEICO wrongfully denied underinsured motorist coverage to Ms. Pixler. In denying the claim, GEICO cited a policy exclusion that purports to exclude underinsured motorist coverage when the insured is a passenger in an insured-owned vehicle.

On September 28, 2023, Plaintiffs filed this motion to strike the motion for summary adjudication and/or portions of the motion for summary adjudication filed by Defendants Government Employees Insurance Company and GEICO General Insurance Company. On October 11, 2023, Defendants filed an opposition. On October 17, 2023, Plaintiffs filed a reply.

Legal Standard

“The court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading. (b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.” (Code Civ. Proc., § 436.) The defects must be apparent on the face of the challenged pleading. (Code Civ. Proc., § 437.)

Meet and Confer

The demurrer and motion to strike are accompanied by the declaration of Armen Akaragian, which satisfies the meet and confer requirement. (Code Civ. Proc. § 435.5(a).)

Discussion

Plaintiffs seek to strike the entirety of GEICO’s pending Motion for Summary Adjudication or, in the alternative, specific portions, on the grounds that it cites and relies heavily on an unpublished opinion of a California Court of Appeal which must not be cited or relied on by a court or a party, pursuant to California Rule of Court (CRC) 8.1115.

In opposition, GEICO argues that it does not cite the unpublished case as precedential legal authority. Rather, GEICO cites the case because it is undisputed that GEICO relied on this unpublished Court of Appeals decision to support its coverage determination.

GEICO argues that published California legal authority explicitly authorizes an insurer to rely on unpublished cases that support a coverage determination. (See, e.g., Morris v. Paul Revere Life Ins. Co. (2003) 109 Cal.App.4th 966 (finding no bad faith where the insurer had “two [unpublished] California Courts of Appeal[s decisions] in its corner” at the time of the coverage denial, and therefore the insurer’s decision could not have been unreasonable); see also LG Infocomm U.S.A., Inc. v. Euler Am. Credit Indem. Co., 419 F. Supp. 2d 1248, 1256 & n.2, 1258 (granting summary judgment on a bad faith claim based on the “genuine dispute doctrine” where the insurer relied on an unpublished decision because “[t]he parties to an insurance contract may fairly look to such cases for a reasoned analysis of specific policy language by a court, or, as in this case, for a reasoned analysis of a statute that uses the same language as the policy”); Badiali, 220 N.J. at 560 (rejecting the application of a New Jersey rule prohibiting citation to unpublished decisions in a bad faith case and holding that “the existence of the unpublished Geiger decision precludes a finding of bad faith against” the insurer).

GEICO argues that the inquiry into whether there is coverage under the policy is separate and distinct from the inquiry into whether, as a matter of law GEICO committed bad faith. Under California law, even in cases where coverage is wrongly denied (which GEICO disputes), an insurer does not commit bad faith if it had a reasonable basis for denying the claim. (Chateau Chamberay Homeowners Ass’n v. Associated Int’l Ins. Co. (2001) 90 Cal.App.4th 335, 347 (“a denial of benefits is merely a breach of contract”); Jordan v. Allstate Ins. Co. (2007) 148 Cal.App.4th 1062, 1073 (to maintain a bad faith claim, the denial must have been “without any reasonable basis”).)

GEICO further argues that ignoring unpublished opinions in its coverage determination could be deemed bad faith. (See Pulte Home Corp. v. Am. Safety Indem. Co., 14 Cal. App. 5th 1086, 1102 (2017) (upholding bad faith where insurer ignored relevant unpublished opinions in forming its non-coverage determination).)

CRC 8.1115(a) states in vague language: “Except as provided in (b), an opinion of a California Court of Appeal or superior court appellate division that is not certified for publication or ordered published must not be cited or relied on by a court or a party in any other action.” (CRC 8.1115(a).) Despite its vagueness, the Rule (i.e., its predecessor CRC 977) has been interpreted to apply to citation and stare decisis authority only:

The term “relied,” for purposes of CRC 8.1115, has been interpreted by case law as formal citation for precedential value:

[“The Los Angeles Superior Court relies upon two non-published orders of Divisions One and Two of the Second Appellate District which state challenges to parole denial in habeas corpus petitions are to be heard in the county where the inmate is incarcerated. These two orders cite Griggs v. Superior Court, supra, 16 Cal. 3d 341, and In re Lumbert (1980) 113 Cal. App. 3d. 310 [169 Cal. Rptr. 927]. One of the orders, In re Willard (July 26, 2001, Bl5l797) states: ‘In the future, any petitions for a writ of habeas corpus challenging a decision of the Board of Prison Terms to deny parole should be filed in the superior court of the county where petitioner is incarcerated or in the appellate district for the county in which petitioner is incarcerated.’ The non-published orders are not binding precedents and the Los Angeles Superior Court should not have “relied” upon them. (Cal. Rules of Court, rule 977(a).)]

(In re Sena (2001) 94 Cal.App.4th 836, 838 – 839 (emphasis added).)

“An opinion that is not certified for publication cannot subsequently be cited as legal authority or precedent, except as relevant to the doctrines of law of the case, res judicata, or collateral estoppel, or as relevant to a criminal or disciplinary action because the opinion states reasons for a decision that affects the same defendant or respondent in another action. (Rule 977.)” (Schmier v. Supreme Court (2000) 78 Cal.App.4th 703, 706.) Therefore, “the fact that opinions are not published in the Official Reports means nothing more than that they cannot be cited as precedent by litigants that are not parties to the unpublished case.” (Id., at 712; See also Olinick v. BMG Entertainment (2006) 138 Cal.App.4th 1286, 1301, fn. 11; See also City of Hawthorne ex rel. Wohlner v. H&C Disposal Co. (2003) 109 Cal.App.4th 1668, 1678, fn. 5 (“Although Capella, a United States District Court decision, is not published in the Federal Supplement, it is citable notwithstanding California Rules of Court rule 977, which only bars citation of unpublished California opinions. Therefore, Capella is citable as persuasive, although not precedential, authority.”).)

First, the court notes that Morris, supra, 109 Cal.App.4th 966 does not say anything about unpublished cases. The two cases referenced by Defendant in Morris were opinions that were granted review by the Supreme Court. (Id., at 970.) Next, the Court also notes that Badiali is a case by the Supreme Court of New Jersey and again cannot be relied on for precedential value.

However, the Court finds the federal district court’s reasoning in LG Infocomm U.S.A., Inc. v. Euler Am. Credit Indem. Co., 419 F. Supp. 2d 1248, 1256 persuasive. The district court stated:

While Wechsler is an unpublished opinion, such opinions still may provide an insurer (or an insured) with valuable insight as to how policy language might reasonably be interpreted by a court. With Westlaw, Lexis, and other computer-based programs, unpublished opinions on virtually every aspect of law are ubiquitous and easily accessible. These types of opinions, while not citable in a court of law for precedential value, do serve legitimate purposes in a variety of other contexts, including the present circumstance. The parties to an insurance contract may fairly look to such cases for a reasoned analysis of specific policy language by a court, or, as in this case, for a reasoned analysis of a statute that uses the same language as the policy. Such research (and reliance on unpublished opinions) are particularly reasonable when no directly applicable, published authority exists.

(LG Infocomm U.S.A., Inc. v. Euler Am. Credit Indem. Co., 419 F. Supp. 2d 1248, n2 1258.) Thus, because CRC 8.1115 bars the use of an unpublished case as precedential authority, and GEICO is not using the unpublished case at issue for precedent, but rather, is attempting to show that its conduct in relying on this unpublished case at the time it denied coverage was reasonable, especially because no published authority exists, the Court finds that GEICO’s use of this case is not prohibited by CRC 8.1115. As a result, the motion to strike is denied.

Conclusion

Based on the foregoing, Plaintiffs’ motion to strike is DENIED.
Moving party to give notice.