United States District Court, D. Utah, Central Division
AQUATHERM, LLC; CORNERSTONE TECHNOLOGIES, LLC; STAG II LINDON, LLC; STAG INDUSTRIAL, INC.; and VIVINT, INC., Plaintiffs,
CENTIMARK CORPORATION, Defendant.
Nuffer Chief District Judge
MEMORANDUM DECISION AND ORDER DENYING DISCOVERY
M. Warner Chief United States Magistrate Judge
Judge David Nuffer referred this case to Chief Magistrate
Judge Paul M. Warner pursuant to 28 U.S.C. §
636(b)(1)(A). Before the court is Defendant Centimark
Corporation's (“Centimark”) Motion to Compel
Discovery Requests from Stag II Lindon, LLC and Deem Matters
Admitted. Having reviewed the parties' briefs
and the relevant law, the court renders the following
Memorandum Decision and Order.
above captioned lawsuit is a property damage subrogation
action brought by several insurance companies to recover
damages for a fire allegedly caused by Centimark. In 2013,
Stag II Lindon, LLC (“Stag”) hired Centimark to
perform roofing work on Stag's commercial property in
Lindon, Utah. At the time, Stag's property was
leased to several tenants, including: Aquatherm, LLC;
Cornerstone Technologies, LLC; and Vivint, Inc. While working on
Stag's roof, Centimark allegedly damaged the roof's
de-icing cable which subsequently caused a
fire.The fire allegedly caused damage to
Stag's building and its tenants businesses.
time of the fire, Stag and its tenants were covered by
insurance policies issued by Liberty Mutual Insurance
Company, American Economy Insurance Company, Travelers
Property Casualty Company of America, and Hartford Fire
Insurance Company (collectively “Insurance
Companies”). Relevant to the present dispute, Stag
asserts that its insurance company, Liberty Mutual Fire
Insurance Company (“Liberty Mutual”), paid
benefits to Stag covering all of the property damage Stag
suffered as a result of the fire. Moreover, the Complaint
indicates that Stag's tenants also received full
compensation from their respective insurers.
September 19, 2016, the Insurance Companies initiated this
subrogation action seeking recovery from Centimark. Pursuant
to Utah Code Ann. § 31A-21-108, the Insurance Companies
brought suit in the names of the insured
March 16, 2017, Centimark served Stag with its First Set of
Interrogatories, Requests for Production, and Requests for
Admission. Liberty Mutual responded by stating:
this is a subrogation action brought by insurers in the name
of their respective insureds pursuant to Utah Code Ann.
§ 31A-21-108. The actual entities Stag II Lindon, LLC
and Stag Industrial, Inc. (‘Stag') . . . are not
parties to this litigation, were not served with any requests
for admission, and are not providing any discovery responses.
The real party in interest with respect the damage sustained
by Stag is [Liberty Mutual]. Therefore, Liberty [Mutual]
construes the word ‘Stag' in these requests for
admission and in the following answers to mean ‘Liberty
[Mutual] suing in the name of Stag pursuant to Utah Code Ann.
Centimark filed the above motion seeking to compel Stag to
respond to its discovery requests.
seeks an order from the court compelling Stag to respond to
its discovery requests and, in the alternative, for the court
to deem Stag's nonresponses to its requests for admission
as admitted. Centimark claims that because the
Insurance Companies sued in the names of the insured parties,
Stag is required to directly respond to Centimark's
discovery requests. In response, the Insurance Companies
argue that Stag has been fully indemnified and, therefore, is
a party in name only. According to the Insurance Companies,
Centimark must rely on Rule 45 of the Federal Rules of Civil
Procedure to seek discoverable information directly from
Stag. In other words, the parties simply
disagree about the method in which Centimark must go about
seeking discovery from Stag.
is a doctrine that “allows an insurer, which has paid a
loss, to step into the shoes of its insured and recoup its
losses from a party whose negligence caused the loss.”
Fashion Place Inv., Ltd. v. Salt Lake Cty./Salt Lake Cty.
Mental Health, 776 P.2d 941, 944 (Utah Ct. App. 1989)
(citation omitted); Hemingway v. Constr. by Design
Corp., 2015 UT App 10, ¶ 8, 342 P.3d 1135.
Generally, a subrogation action limits the insurance company
to “those rights or causes of action that the insured
possesses against the third party.” Bakowski v.
Mountain States Steel, Inc., 2002 UT 62, ¶
23, 52 P.3d 1179. Pursuant to Utah Code Ann. §
31A-21-108, “[s]ubrogation actions may be
brought by the insurer in the name of its insured.”
(emphasis added). Utah courts have not neatly defined the
application of § 31A-21-108 in situations where the
insurance company has fully indemnified the injured party.
example, in Wilson v. Educators Mutual Insurance
Association, the insurance company argued that §
31A-21-108's use of the word “may” implies
that an insurer may bring the action in the name of the
insured but is not required to do so. 2016 UT App 38, ¶
8, 368 P.3d 471, cert. granted, Wilson v.
Educators Mut., 379 P.3d 1182 (Utah 2016). The Utah
Court of Appeals held that despite § 31A-21-108's
use of the permissive word “may, ” an insurance
company does not have independent right to seek subrogated
damages in its own name where the injured party has not been
made whole. Id. at ¶ 9. The court recognized
that when the insured retains an interest in the case, the
insurance company's subrogation rights are secondary to
the insured's interest in controlling the cause of
action. Id. at ¶ 11. Furthermore, requiring the
insurance company to sue in the name of the insured protects
third-party defendants from defending multiple lawsuits.
Id. at ¶ 10. Conversely, if an insurer has
fully indemnified the insured, the insurance company has the
right to sue in its own name. Id ...