United States District Court, W.D. Oklahoma
GINA MILITELLO, now ERIN, Individually and as Administratrix of The Estate of ASHLEY NICOLE CRABTREE, Deceased, Plaintiff,
ICAN LOGISTICS, INC., a Foreign For Profit Corporation; ZEYS WANG, an Individual; and HONGYUE TRUCKING, INC., Defendants. and ICAN LOGISTICS, INC., Defendant/ Third-Party Plaintiff,
WESCO INSURANCE COMPANY, Third-Party Defendant.
HEATON CHIFE U.S. DISTRICT JUDGE.
Gina Militello filed this wrongful death action
individually and on behalf of her deceased daughter, Ashley
Nicole Crabtree, against ICAN Logistics, Inc.
(“ICAN”),  Zeyu Wang, and Hongyue Trucking, Inc.
(“Hongyue”). Her claims arise out of a vehicle
accident involving the decedent and defendant Wang. ICAN
filed a third-party complaint against Wesco Insurance Company
(“Wesco”), who then filed a counterclaim and
crossclaims for declaratory judgment against ICAN, Militello,
Hongyue and Wang. Wesco and ICAN have filed motions for
summary judgment and Ms. Militello has filed a partial motion
for summary judgment. In this order the court will address
Wesco's and plaintiff's motions.
judgment is appropriate only “if the movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). “A genuine dispute as to a material
fact ‘exists when the evidence, construed in the light
most favorable to the non-moving party, is such that a
reasonable jury could return a verdict for the non-moving
party.'” Carter v. Pathfinder Energy Servs.,
Inc., 662 F.3d 1134, 1141 (10th Cir. 2011) (quoting
Zwygart v. Bd. of Cnty. Comm'rs, 483 F.3d 1086,
1090 (10th Cir.2007)). Considering the motions filed under
this standard, the court concludes both Wesco's and
plaintiff's motions should be denied.
daughter was killed when her vehicle collided with a
tractor-trailer driven by Zeyu Wang on March 6, 2016, in
Oklahoma City, Oklahoma. In the amended complaint
(“complaint”) plaintiff alleges that defendant
Hongyue leased a tractor and trailer and provided a driver,
Wang, to ICAN. Plaintiff alleges that both ICAN and Hongyue
should have known that Wang, who purportedly left California
around March 5, 2016, transporting cargo in the
tractor-trailer,  was not qualified to operate the vehicle
because he could not speak or write English sufficiently to,
among other things, understand traffic signs and make legible
entries on reports and records. Plaintiff alleges that Wang
violated federal motor carrier regulations by failing to take
mandatory rest breaks while driving from California. She
specifically claims that when the accident occurred Wang had
been driving more than eleven hours, been on duty more than
fourteen hours and had falsified his record of duty logs.
Plaintiff contends that, even though there was a sign on the
road where the accident occurred which stated
“'Congestion Be Prepared to Stop, ' Wang
negligently struck the rear of Crabtree's vehicle,
fatally injuring her daughter. Doc. #15, p. 4, ¶¶
28-29. Plaintiff asserts claims for negligence
and negligence per se against ICAN, Wang and Hongyue.
filed a crossclaim against Hongyue, asserting it is entitled
to contractual indemnity pursuant to the terms of the lease
agreement (“Agreement”) they executed and common
law indemnity for any liability imposed in this action. ICAN
claims that Hongyue breached the Agreement by failing to list
it as an additional insured on an insurance policy Hongyue
obtained from Westco. ICAN also filed a third-party complaint
against Wesco. ICAN alleges that at the time of the accident
Wesco insured defendant Hongyue for “any and all of the
alleged liability claimed by Plaintiff against Hongyue
Trucking, Inc.” and that its (ICAN's) agreement
with Hongyue required Hongyue to list it as an additional
insured on the Wesco insurance policy. Doc. #18, p. 2,
¶¶ 3, 5. ICAN alleges that Wesco “breached
its duty and the Lease Agreement by failing to make ICAN an
additional insured under its policy.” Id. at
issued a commercial motor carrier insurance policy
(“Policy” or “basic Policy”) to
Hongyue with effective dates of February 9, 2016 to February
9, 2017. Wesco seeks a declaratory judgment that it has no
duty under the Policy to defend and/or indemnity ICAN,
Hongyue, Wang or any other party, principally because Hongyue
was not acting as a for-hire motor carrier at the time of the
accident. In her motion plaintiff asks the court to determine
as a matter of law that Hongyue was a “for-hire motor
carrier for the trip at issue.” Doc. #57, p. 9.
undisputed that the basic insurance policy Wesco issued to
Hongyue does not provide insurance coverage for the
accident. The leased tractor and trailer
(“tractor”) that are the subject of the Agreement
between ICAN and Hongyue were not specifically described in
the Policy and are not, therefore, “covered
autos” under its terms. Because they were not
“covered autos, ” ICAN, Hongyue and Wang are not
“insureds” under the Policy. However, attached to
the basic Policy is a federally mandated MCS-90 endorsement.
Plaintiff argues that it applies to provide insurance
coverage for the accident.
regulations require interstate trucking companies to maintain
insurance or another form of surety ‘conditioned to pay
any final judgment recovered against such motor carrier for
bodily injuries to or the death of any person resulting from
the negligent operation, maintenance or use of motor
vehicles.'” Carolina Cas. Ins. Co. v.
Yeates, 584 F.3d 868, 870 (10th Cir. 2009) (quoting 49
C.F.R. § 387.301(a); see also id. §
387.7). Most interstate trucking companies obtain the MCS-90,
a specific endorsement to one or more of their insurance
policy or policies, “which guarantees payment of
minimum amounts, as set forth in the regulations, to an
injured member of the public.” Id. (quoting 49
C.F.R. §§ 387.7, 387.9). “An MCS-90
endorsement is intended to eliminate the possibility of a
denial of coverage by requiring the insurer to pay any final
judgment recovered against the insured for negligence in the
operation, maintenance, or use of motor vehicles subject to
federal financial responsibility requirements, even though
the accident vehicle is not listed in the policy.”
Id. (internal quotation marks omitted).
Yeates the Tenth Circuit concluded that “the
MCS-90 endorsement is intended to impose a surety obligation
on the insurance company.” Id. at 879. It
[W]hen an injured party obtains a negligence judgment against
a motor carrier, an insurer's obligation under the MCS-90
endorsement is not triggered unless (1) the underlying
insurance policy (to which the endorsement is attached) does
not provide liability coverage for the accident, and (2) the
carrier's other insurance coverage is either insufficient
to meet the federally-mandated minimums or non-existent. Once
the federally-mandated minimums have been satisfied, however,
the endorsement does not apply.
asserts that most of the requirements that must be met for
the MCS-90 endorsement to be triggered have not been
satisfied here. It contends that a final judgment has not
been entered against Hongyue, the named insured, and
“the other motor carrier's aggregate coverage is
[sufficient] to satisfy the federally mandated minimum levels
of financial responsibility.” Doc. #49, p.
Wesco also argues that, for the endorsement to be triggered,
Hongyue must have been “operating as a for-hire motor
carrier at the time of the accident.” Herrod v.
Wilshire Ins. Co., 499 Fed.Appx. 753, 760 (10th Cir.
2012). As explained by the Tenth Circuit in Herrod,
the “financial responsibility requirements of the MCA
apply to ‘motor carriers.'” Herrod,
499 Fed.Appx. at 759 (citing 49 U.S.C. §31139(b)). The
MCA defines the term as “a person providing motor
vehicle transportation for compensation.” 49 U.S.C.
§ 13102(14). A “motor carrier” is defined by
the regulations promulgated pursuant to the MCA and
accompanying the MCS-90 endorsement as a “for-hire
motor carrier or a private motor carrier.” 49 C.F.R.
§ 387.5. “[F]or-hire carriage is defined as
“the business of transporting, for compensation, the
goods or property of another.” Id. A motor
carrier includes “a motor carrier's agent, officer,
or representative.” 49 C.F.R. § 387.5. Wesco