Abbey Co., LLC v. Lexington Insurance

MEMORANDUM *

Plaintiff-Appellant Abbey Company, LLC (Abbey) appeals (1) the district court’s decision denying summary judgment for Abbey and granting summary judgment for Defendant-Appellee Lexington Insurance Company (Lexington) and (2) the district court’s decision denying its motion to alter or amend the judgment. Because the parties are familiar with the facts, we do not recount them here, except as necessary to explain our decision. We have jurisdiction to hear this appeal under 28 U.S.C. § 1291 , and we review de novo the district court’s decision on summary judgment. Valdez v. Rosenbaum, 302 F.3d 1039, 1043 (9th Cir.2002).

Jurisdiction

Even assuming that the issue litigated in Unocal Corp. v. Lexington Insurance Co., Lexington’s citizenship in March 2005, was “sufficiently similar to” the issue of Lexington’s citizenship 18 months later, Appling v. State Farm Mut. Auto. Ins. Co., 340 F.3d 769, 775 (9th Cir.2003), the district court did not err in declining to allow offensive non-mutual collateral estoppel. “Allowing offensive non-mutual collateral estoppel may be unfair to a defendant ‘if the judgment relied upon as a basis for the estoppel is itself inconsistent with…

concurring in part and dissenting in part:

I concur in the majority’s disposition of the jurisdictional question, but I respectfully dissent on the merits. Abbey’s insurance policy “insures against all risk of physical loss of or damage to property described herein.” The accumulation of debris after a severe storm does not constitute “physical ... damage to” the channel. Debris naturally accumulates in any river as it flows. One of the purposes of the channel, in directing the Los Angeles River to the Pacific Ocean, is to wash the river’s silt and debris into the ocean. Accumulation of debris in the channel is not like a mudslide that buries a road leading to the marina, as the majority states, see Majority Op. at-, because the purpose of a road is to facilitate the flow of vehicles, not mud. Rather, the accumulation of debris in the channel is like a traffic jam on the 405 freeway — a natural and expected occurrence that blocks the flow of traffic to the marina, but by no means causes “damage” to the freeway.

The City of Long Beach had an agreement with Abbey to dredge the channel of debris on a regular basis, which is evidence that accumulation of this debris was a natural and…