The opinion of the court was delivered by: Samuel Der-yeghiayan, District Judge
This matter is before the court on the parties' cross motions for summary judgment. This matter is also before the court on Defendant Denise Squire's, Defendant Joe Vaccaro's (Vaccaro), and Defendant Estate of Justin Newman's (Newman Estate)(collectively referred to as "Beneficiaries") motion to strike. For the reasons stated below, the court denies the Beneficiaries' motion to strike, the court grants in part and denies in part the Beneficiaries' motion for summary judgment, and the court grants in part and denies in part Plaintiff Fidelity Investments Life Insurance Company's (FILI) motion for summary judgment.
In August 1999, FILI issued a $5,000,000.00 life insurance policy (Policy) covering Ari Squire. On December 20, 2006, Ari Squire executed a Beneficiary Change Form, which purportedly designated Denise Squire as a primary beneficiary of 80% of the death benefit ($4,000,000.00), Vaccaro as a primary beneficiary of 20% of the death benefit ($1,000,000.00), and Shana Majmudar (Majmudar), as the secondary beneficiary of 100% of the death benefit.
In an attempt to fake his death and thereby obtain proceeds under the Policy (Proceeds), Ari Squire allegedly murdered Justin Newman (Newman), assumed Newman's identity, and fled to Missouri. On March 2, 2008, Ari Squire shot and killed himself when several police officers came to his hotel room to investigate the presence of Newman's car in the hotel parking lot. In August 2008, Denise Squire submitted a claim for benefits under the Policy. Upon FILI's investigation of the claim, FILI learned that Denise Squire had been implicated in Newman's alleged murder. On May 4, 2009, FILI filed the instant declaratory judgment action, naming Denise Squire, Vaccaro, and Majmudar as Defendants.
After the Newman Estate prevailed against Denise Squire in a civil jury trial, Denise Squire assigned a significant portion of her rights under the Policy to the Newman Estate. In settlement of a separate civil lawsuit, Vaccaro also assigned a significant portion of his rights under the Policy to the Newman Estate. Thus, the Newman Estate became a significant party in interest in the instant action. Ultimately, all of the parties reached a partial settlement agreement, whereby FILI paid the Proceeds to the Beneficiaries. However, the parties were unable to reach a resolution regarding how much interest on the Proceeds, if any, FILI was required to pay, given the unique circumstances of this case. FILI and the Beneficiaries have each moved for summary judgment on the issue of the payment of interest. The Beneficiaries have also moved to strike FILI's reply brief in support of FILI's motion for summary judgment.
Summary judgment is appropriate when the record, viewed in the light most favorable to the non-moving party, reveals that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). In seeking a grant of summary judgment, the moving party must identify "those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)(quoting Fed. R. Civ. P. 56(c)). This initial burden may be satisfied by presenting specific evidence on a particular issue or by pointing out "an absence of evidence to support the non-moving party's case." Id. at 325. Once the movant has met this burden, the non-moving party cannot simply rest on the allegations in the pleadings, but, "by affidavits or as otherwise provided for in [Rule 56], must set forth specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). A "genuine issue" in the context of a motion for summary judgment is not simply a "metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Rather, a genuine issue of material fact exists when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Insolia v. Philip Morris, Inc., 216 F.3d 596, 599 (7th Cir. 2000). The court must consider the record as a whole, in a light most favorable to the non-moving party, and draw all reasonable inferences that favor the non-moving party. Anderson, 477 U.S. at 255; Bay v. Cassens Transport Co., 212 F.3d 969, 972 (7th Cir. 2000). When there are cross motions for summary judgment, the court should "construe all inferences in favor of the party against whom the motion under consideration is made." Mote v. Aetna Life Ins. Co., 502 F.3d 601, 606 (7th Cir. 2007)(internal quotations omitted); see also Krieg v. Seybold, 481 F.3d 512, 516 (7th Cir. 2007).
I. Beneficiaries' Motion to Strike
The Beneficiaries have moved to strike FILI's reply brief in support of FILI's motion for summary judgment, arguing that FILI improperly introduced new arguments in its reply. Motions to strike are generally disfavored because they "potentially serve only to delay." Heller Financial, Inc. v. Midwhey Powder Co., Inc. 883 F.2d 1286, 1294 (7th Cir. 1989); see also Redwood v. Dobson,476 F.3d 462, 471 (7th Cir. 2007)(stating that motions to strike "disserve the interest of judicial economy"). In this case, the public policy arguments raised by FILI in its reply brief address certain arguments made by the Beneficiaries in their response brief. In addition, FILI has advanced those same public policy arguments throughout the litigation. The court has considered FILI's arguments, and therefore the Beneficiaries' motion to strike is denied.
II. Cross-Motions for Summary Judgment
In their cross-motions for summary judgment, the parties dispute the amount of interest, if any, that FILI owes ...