United Specialty Insurance Co. v. Bani Auto Group, Inc. ( 2023 )


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  •                                                                               FILED
    NOT FOR PUBLICATION
    MAR 8 2023
    UNITED STATES COURT OF APPEALS                         MOLLY C. DWYER, CLERK
    U.S. COURT OF APPEALS
    FOR THE NINTH CIRCUIT
    UNITED SPECIALTY INSURANCE                       No.   21-17042
    COMPANY,
    D.C. No. 5:18-cv-01649-BLF
    Plaintiff-Appellee,
    v.                                              MEMORANDUM*
    SIAVOSH BANIHASHEMI, AKA Sia
    Bani,
    Defendant-Appellant,
    and
    BANI AUTO GROUP, INC.; et al.,
    Defendants.
    Appeal from the United States District Court
    for the Northern District of California
    Beth Labson Freeman, District Judge, Presiding
    Argued and Submitted January 27, 2023
    San Francisco, California
    Before: GOULD, RAWLINSON, and BRESS, Circuit Judges.
    *
    This disposition is not appropriate for publication and is not precedent
    except as provided by Ninth Circuit Rule 36-3.
    Siavosh Banihashemi (Bani) appeals the district court’s summary judgment
    order holding him jointly and severally liable for reimbursement of the cost of the
    settlement that United Specialty Insurance Company (United Specialty) reached on
    behalf of Bani, Bani Auto Group, Inc. (Bani Auto), and Club Sportiva, Inc. (Club
    Sportiva) (collectively, the “Bani Defendants”) in a wrongful death action.
    “We review the district court’s grant of summary judgment de novo. . . .”
    Bliss Sequoia Ins. & Risk Advisors, Inc. v. Allied Prop. & Cas. Ins. Co., 
    52 F.4th 417
    , 419 (9th Cir. 2022) (citation omitted). “Summary judgment is appropriate
    when, viewing the evidence in the light most favorable to the non-movant, there is
    no genuine issue of material fact and the movant is entitled to judgment as a matter
    of law. . . .” Metal Jeans, Inc. v. Metal Sport, Inc., 
    987 F.3d 1242
    , 1244 (9th Cir.
    2021) (citation and internal quotation marks omitted).
    On the record before the district court, United Specialty was not entitled to
    summary judgment as a matter of California law. See 
    id.
     In California, an “insurer
    seeking recovery against the insured for expenditures in settling a case when the
    claims were not covered should allocate those expenditures among the insureds.”
    Axis Surplus Ins. Co. v. Reinoso, 
    208 Cal.App.4th 181
    , 195 (2012). The burden of
    proving allocation is “squarely on insurers asserting claims for reimbursement.”
    2
    LA Sound USA, Inc. v. St. Paul Fire & Marine Ins. Co., 
    156 Cal.App.4th 1259
    ,
    1273 (2007).
    Although a finding of joint and several liability may ultimately be
    appropriate for all three Bani Defendants, the record before us reflects the
    existence of a material issue of fact regarding allocation of the settlement amount
    among the insureds. See Axis Surplus, 208 Cal.App.4th at 195. Neither Bani’s
    deposition testimony that he is an officer and owner of Bani Auto and Club
    Sportiva, nor the fact that Bani acquiesced in United Specialty’s settlement of the
    underlying actions, is sufficient to establish that United Specialty engaged in “a
    detailed analysis of how the indemnity costs were spent,” as required under
    California law. LA Sound, 156 Cal.App.4th at 1273. Nor is there evidence in this
    record to support an inference that Bani would be jointly and severally liable in the
    underlying action as a joint tortfeasor or as an alter ego of the other Bani
    Defendants. See Cam-Carson, LLC v. Carson Reclamation Auth., 
    82 Cal.App.5th 535
    , 549 (2022) (stating the “unity of interest and ownership” and “inequitable
    result” requirements of the alter ego doctrine) (citation omitted).
    Accordingly, we VACATE the district court’s award of summary judgment
    in favor of United Specialty. We REMAND for further proceedings, which may
    include additional factual development, on the question of whether Bani is jointly
    3
    and severally liable as a joint tortfeasor or as an alter ego of the other Bani
    Defendants.
    4
    

Document Info

Docket Number: 21-17042

Filed Date: 3/8/2023

Precedential Status: Non-Precedential

Modified Date: 3/8/2023