Golden Eagle Insurance Corporation v. Cammack
- Martinez-Olguin
- 3:24-cv-01670
- U.S. District Court · Northern District of California
- 3
In Golden Eagle Insurance v. Cammack, Judge Martinez-Olguin stayed the coverage case pending state litigation and administratively terminated the pleadings motion.
Golden Eagle Insurance Corporation, Peerless Insurance Company, Richard Cammack, and the related state-court litigation involving Jane WK Doe1.
What happened
Golden Eagle Insurance Corporation and Peerless Insurance Company asked the court to declare that they owed no insurance coverage, defense, or reimbursement obligations to Richard Cammack in related state-court litigation. Cammack asked the federal court to pause this case until the state case ended, while the insurers sought judgment based on the existing pleadings.
The court found that pausing the case would not unfairly harm the insurers because they could resume the federal case and seek defense costs later. Continuing both cases at once could force Cammack to fight on two fronts, and facts from the state case could affect the insurance dispute. Waiting would also conserve judicial resources and avoid parallel litigation.
Judge Araceli Martinez-Olguin granted Cammack’s motion to stay pending resolution of the state case. The court administratively terminated the insurers’ motion for judgment on the pleadings, subject to possible resubmission after the stay ends, and required the insurers to file joint status reports every 90 days.
The detailed version
- Golden Eagle Insurance Corporation v. Cammack · No. 3:24-cv-01670
- Martinez-Olguin
- Jan. 29, 2025
Background
Golden Eagle Insurance Corporation and Peerless Insurance Company sought a declaratory judgment stating that they had no coverage obligation, duty to defend, or duty to indemnify Richard Cammack, doing business as Contra Costa Ballet Centre, in ongoing state-court litigation. The insurers also sought reimbursement for defense costs incurred in that litigation. The state case arises from allegations that ballet instructor Viktor Kabaniaev sexually abused Jane WK Doe1 while she was a minor. Jane WK Doe1 is the plaintiff in the state case and a nominal defendant in this federal action.
Cammack moved to stay, or pause, the federal case until the state litigation was resolved. The insurers opposed the stay and moved for judgment on the pleadings, which asks the court to decide a case based on the pleadings without a trial. The court considered the stay motion first because it was not inclined to reach the pleadings motion if the case were stayed.
Reasons for the Stay
The court applied the factors governing its inherent power to stay proceedings: possible harm to the party opposing the stay, hardship or unfairness to the party required to continue, and the orderly administration of justice.
The first factor did not favor the insurers. They did not squarely explain what prejudice they would suffer from a stay. Even if they relied on an agreement to defend the state case while seeking a declaration of no coverage, the court concluded that the agreement did not change the analysis. The insurers could resume this case after the state proceedings ended and could continue seeking reimbursement for defense costs at that time.
The second factor favored a stay. The state case raised factual issues that would inform the coverage dispute, including whether Jane WK Doe1 was in Cammack’s “care, custody or control” and whether Cammack was negligent in employing, investigating, supervising, or retaining Kabaniaev, or in failing to report him. Requiring Cammack to litigate both cases at the same time could subject him to the burden of fighting a “two-front war.”
The third factor also favored a stay. The court concluded that allowing the state case to establish the underlying facts first would conserve judicial resources, avoid parallel litigation, and potentially promote a global resolution. The court did not reach the parties’ arguments about whether California law independently supported a stay.
Ruling and Case Management
The court GRANTED the motion to stay pending resolution of the state-court case. In light of that ruling, it administratively terminated the motion for judgment on the pleadings, subject to resubmission if necessary after the stay is lifted. The court ordered the insurers to file a joint status report within 90 days of the order and every 90 days afterward. Once the state case resolves, any party may seek to lift the stay by stipulation or by an administrative motion complying with Civil Local Rule 7-11. The order also vacated the then-current February 14, 2025 status-report deadline.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.