Scottsdale Insurance Company v. McGrath

Background

Scottsdale Insurance Company moved to strike portions of Patrick McGrath’s motion in limine. A motion in limine is a request for a pretrial ruling about whether proposed evidence may be presented at trial. Scottsdale argued that McGrath’s requests were untimely attempts to obtain summary judgment—a ruling that claims or defenses fail without a trial.

The opinion notes that, in an earlier ruling in this case, the court denied Scottsdale’s motion for summary judgment and concluded that McGrath was an insured under a Business and Management Indemnity policy issued to Watershed Ventures, LLC. The case management plan required summary-judgment motions to be filed by April 15, 2021. Scottsdale filed a motion for partial summary judgment by that date; McGrath did not file one.

Issues in McGrath’s Motion

In Section A, McGrath sought to prevent Scottsdale from relying on the policy’s Subsidiary Exclusion in support of its request for a declaratory judgment and in opposition to McGrath’s claim that Scottsdale refused to defend or indemnify him. In Section B, McGrath sought to prevent Scottsdale from arguing that he failed to provide timely notice. In Section E, McGrath sought to exclude evidence concerning the Subsidiary Exclusion and notice issues based on statements Scottsdale allegedly made in an earlier appeal to the Second Circuit.

Subsection A(d) of Section A separately argued that Scottsdale should not be allowed to introduce evidence of McGrath’s alleged wrongdoing under Federal Rules of Evidence 401, 403, and 404.

Court’s Reasoning

The court explained that a motion in limine is intended to resolve in advance whether particular evidence relevant to issues set for trial should be admitted. It may not be used as a disguised second motion for summary judgment. Sections A and B generally argued that Scottsdale’s substantive claims or defenses failed as a matter of law based on supposedly undisputed facts. The court concluded that those sections sought advance rulings disposing of substantial portions of the case rather than ordinary evidentiary rulings.

Because the deadline for summary-judgment motions had passed, the court held that McGrath could not obtain those rulings through a motion in limine. If Scottsdale’s evidence ultimately failed to create a triable issue, the court stated that McGrath’s proper remedy would be a motion for judgment as a matter of law after Scottsdale presented its evidence.

The court distinguished Subsection A(d), which raised ordinary evidence questions about relevance, unfair prejudice, and other concerns. It also distinguished Section E because McGrath could not have made his arguments about the effect of Scottsdale’s statements in the Second Circuit when the summary-judgment deadline passed. The court said it should decide before trial whether those statements are admissible and, if so, whether they are judicial admissions or merely evidentiary admissions.

Disposition

Judge Liman granted in part and denied in part Scottsdale’s motion to strike. The court granted the motion as to Sections A and B of McGrath’s motion in limine, except for Subsection A(d). The court denied the motion as to Subsection A(d) and Section E. Scottsdale was ordered to respond to Subsection A(d) and Section E by October 11, 2024. The Clerk of Court was directed to close the motion to strike at Docket No. 145.

This order did not decide the underlying insurance-coverage questions on the merits. It determined which portions of McGrath’s pretrial motion could proceed as evidentiary requests and which portions were untimely attempts to obtain summary-judgment relief.