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Founders Insurance Co. v. Cuz DHS, LLC

United States District Court, D. Connecticut

November 28, 2017

FOUNDERS INSURANCE CO., Plaintiff,
v.
CUZ DHS, LLC et al., Defendant.

          RULING RE: MOTION TO DISMISS (DOC. NO. 19)

          Janet C. Hall, United States District Judge.

         I. INTRODUCTION

         The plaintiff, Founders Insurance Co., filed a Complaint on September 1, 2017, seeking a declaratory judgment against the defendants, Cuz DHS, LLC (“Cuz”), Gary Cavallaro, Jeffrey Winslow, Pub 67, LLC, Craig Strilka, and Daniel DeGeorge. See Complaint (“Compl.”) (Doc. No. 1). The defendants, Cuz and Gary Cavallaro, filed a Motion to Dismiss the claims against them on October 9, 2017. See Motion to Dismiss (“Mot. to Dismiss”) (Doc. No. 19). Founders Insurance filed an Amended Complaint on November 2, 2017, in which it removed Gary Cavallaro as a defendant and added Gina Cavallaro in her capacity as executrix of Gary Cavallaro's estate. See Amended Complaint (“Am. Compl.”) (Doc. No. 25).

         For the reasons set forth below, the court terminates as moot the Motion to Dismiss with respect to Gary Cavallaro. With respect to Cuz, the court defers dismissal and, pursuant to Federal Rule of Civil Procedure 4(m), extends the time to effectuate service. Founders Insurance is hereby ordered to execute proper service of process on Cuz by December 18, 2017.

         II. FACTS AND PROCEDURAL BACKGROUND

         On September 1, 2017, Founders Insurance filed a Complaint against the defendants, Cuz, Gary Cavallaro, Jeffrey Winslow, Pub 67, Craig Strilka, and Daniel DeGeorge. See Compl. The Complaint sought a declaratory judgment that Founders Insurance had no duty to defend or indemnify Cuz or Gary Cavallaro in the pending case before the Connecticut Superior Court, Jeffrey Winslow v. Pub 67, LLC et al. See id. at ¶ 1; Am. Compl. at ¶ 1. In that case, Jeffrey Winslow alleged that, on May 9, 2015, Cuz, doing business as Dark Horse Saloon, and Gary Cavallaro sold alcohol to Daniel DeGeorge, who became aggressive toward and injured Winslow. See Am. Compl. at ¶¶ 13, 15-18.[1] Winslow alleged, inter alia, that Cuz and Gary Cavallaro negligently prevented Winslow from avoiding interaction with DeGeorge and failed to exercise reasonable care in preventing Winslow's injuries, in supervising the conduct of the patrons, in providing adequate security, and in warning Winslow about DeGeorge's conduct. See id. at ¶¶ 19-22. Winslow sued Cuz and Gary Cavallaro for negligence and violation of Conn. Gen. Stat. § 30-102. See id. at ¶¶ 23-24.

         Founders Insurance had issued an insurance policy for liquor liability to Cuz, effective from July 18, 2014, to July 18, 2015. See id. at ¶ 12. Founders Insurance alleges that the insurance policy included an “Assault and/or Battery Exclusion, ” providing that the insurance would not cover, inter alia, “failure to suppress or prevent assault and/or battery, ” “selling, serving, or furnishing alcoholic beverages with results in an assault and/or battery, ” or “negligent: a) Employment; b) Investigation; c) Supervision; d) Reporting to the proper authorities, or failure to report.” Id. at ¶ 25. Founders Insurance seeks a declaration that the claims in the Winslow lawsuit are covered by the exclusion and, therefore, that it is not obligated to defend or indemnify Cuz or Gary Cavallaro in that lawsuit. See id. at ¶ 27.

         On October 4, 2015, Cuz filed for dissolution, effective July 16, 2016-after the events at issue in the Complaint, but before the filing of the Complaint in this case. See Memorandum in Support of the Motion to Dismiss (“Mem. in Supp.”) (Doc. No. 20), Ex. A.[2] Additionally, Gary Cavallaro passed away on March 16, 2017. See id. Ex. B. Gary Cavallaro had previously been the sole member of Cuz and its registered agent of service. See id. Ex. A. On September 15, 2017, a summons for defendant Gary Cavallaro was served on Gina Cavallaro, the executrix of Gary Cavallaro's estate. See Summons Returned Executed (Doc. No. 17) at 1-2. On that same date, another summons for Cuz was also served on Gina Cavallaro. See id. at 1. Summons were also returned executed for the other defendants, but are not at issue in this Motion to Dismiss. See id. at 2-3.

         On October 9, 2017, defendants Gary Cavallaro and Cuz filed a Motion to Dismiss. See Mot. to Dismiss. As to the claim against Gary Cavallaro, the Motion argues that the court lacks subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1) because Gary Cavallaro was deceased at the time the action commenced. See Mem. in Supp. at 3. Therefore, Cavallaro's estate, not the decedent himself, was the proper defendant in the suit. See id. As to the claim against Cuz, the Motion to Dismiss argues that the court lacks personal jurisdiction under Rule 12(b)(2) because service on Gina Cavallaro was insufficient. See id. at 4-5. Founders Insurance filed an Objection to the Motion to Dismiss on October 30, 2017. See Objection to the Motion to Dismiss (“Obj. to Mot. to Dismiss”) (Doc. No. 21). It also filed an Amended Complaint on November 2, 2017, which replaced as a defendant Gary Cavallaro with Gina Cavallaro, the executrix of his estate. See Am. Compl.

         III. LEGAL STANDARD

         A. Rule 12(b)(1) Lack of Subject Matter Jurisdiction

         Under Federal Rule of Civil Procedure 12(b)(1), “[a] case is properly dismissed for lack of subject matter jurisdiction . . . when the district court lacks the statutory or constitutional power to adjudicate it.” Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000). The plaintiff bears the burden of proving the existence of subject matter jurisdiction by a preponderance of the evidence. See id.

         B. Rule 12(b)(2) Lack of Personal Jurisdiction

         Under Rule 12(b)(2), “[a] civil action should be dismissed if the Court lacks personal jurisdiction over a party.” Bull Bag, LLC v. Remorques Savage, Inc., No. 3:16-CV-1735 (VLB), 2017 WL 3763836, at *2 (D. Conn. Aug. 30, 2017). The plaintiff bears the burden to prove that the court has jurisdiction over the defendants. See id. In deciding a motion to dismiss under 12(b)(2), the court has “considerable procedural leeway” to decide the motion on pleadings and affidavits, to permit discovery, or to hold an evidentiary hearing. Perez v. Conn. Dep't of Corr. Parole Div., No. 3:13-CV-150 JCH, 2013 WL 4760955, at *2 (D. Conn. Sept. 4, 2013). If the court chooses to rely on the pleadings and affidavits, the plaintiff can survive a motion to dismiss by making in good faith “legally sufficient allegations of jurisdiction” to establish a prima facie showing of jurisdiction. Bull Bag, 2017 WL 3763836, at *2; see also O'Reilly v. BJ's Wholesale Club, Inc., No. 3:16-CV-01351, 2017 WL 3032217, at *2 (D. Conn. July 17, 2017). In such cases, “[a]ll allegations are construed in the light most favorable to the plaintiff and doubts are resolved in the plaintiff's favor.” O'Reilly, 2017 WL 3032217, at *2.

         “Sufficiency of service is a precondition for the court's exercise of jurisdiction over a party and, therefore constitutes an interrelated ground on which to dismiss a case for lack of personal jurisdiction pursuant to Rule 12(b)(2).” Carliell v. Am. Inv. Exch., LLC, No. 3:12-CV-1700 JCH, 2013 WL 4782133, at *2 (D. Conn. Sept. 5, 2013); see also Jackson v. State of Conn. Dep't of Pub. Health, No. 3:15-CV-750 (CSH), 2016 WL 3460304, at *8 (D. Conn. June 20, 2016) ...


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