United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION & ORDER
B. GOTTSCHALL JUDGE
Illinois Insurance Placement Liability Act (“the
Act”) requires “[a]n insurance producer,
registered firm, and limited insurance representative [to]
exercise ordinary care and skill in renewing, procuring,
binding, or placing the coverage requested by the insured or
proposed insured.” 735 Ill. Comp. Stat. 5/2-2201(a)
(West 2017). The motion to reconsider before the court
presents questions about an insurance producer's duties
to parties other than the insured.
plaintiff, Kyler Moje, played professional hockey in the
minor league for the Danville Dashers. During a game on
February 10, 2012, a player for the opposing team allegedly
hit him in the face with a hockey stick. He suffered serious
injuries and lost the sight in one of his eyes.
sued in this court (but not in this case) and obtained an
$800, 000 default judgment against the Federal Hockey League
(“the League”). See Moje v. Fed. Hockey
League, LLC, 792 F.3d 756, 758-59 (7th Cir. 2015)
(affirming denial of motion to vacate default judgment). He
also sued the manufacturer of the visor he was wearing, but
Moje's second amended complaint (“SAC”) does
not say what became of that claim. See SAC
obtaining the default judgment, Moje brought this action
seeking declaratory relief regarding an insurance policy
issued in June 2012 by defendant National Casualty Co.
(“National Casualty”). See Policy, SAC
Ex. 1. The policy identifies defendant the David Agency as
the policy's producer, National Casualty as the insurer,
and the League and its commissioner, defendant Dan Kirnan as
the insureds. Moje v. Federal Hockey League LLC, 207
F.Supp.3d 833, 836 (N.D. Ill. 2016), Slip Op. at 6, ECF No.
count two, Moje seeks a declaratory judgment against the
David Agency. He alleges that the League communicated to the
David Agency the type of insurance it needed to insure
against the type of loss he sustained, that the David Agency
knew what type of policy the League wanted, and that the
League “was under the impression that the policy at
issue covered personal injury losses, such as that sustained
by Plaintiff.” SAC ¶¶ 38-41 (quotation in
¶ 41). Moje has since made clear his theory is that the
David Agency negligently failed to procure the insurance the
League wanted. See Slip Op. at 8. Whether the policy
covers Moje's claim has yet to be determined.
David Agency moved to dismiss for failure to state a claim.
See Fed. R. Civ. P. 12(b)(6). The court granted its
motion in part and denied it in part in a memorandum opinion
and order entered September 19, 2016 (“the September
2016 opinion”). See Slip Op. at 1, 11. The
David Agency asks the court to reconsider the denial of its
request to dismiss count two.
for reconsideration serve a limited function: to correct
manifest errors of law or fact or to present newly discovered
evidence.” Caisse Nationale de Credit Agricole v.
CBI Indus., Inc., 90 F.3d 1264, 1270 (7th Cir.
1996) (quoting Keene Corp. v. Int'l Fid. Ins.
Co., 561 F.Supp. 656, 665 (N.D. Ill. 1982)). The losing
party's disappointment with the outcome does not
demonstrate manifest error. Oto v. Metro. Life Ins.
Co., 224 F.3d 601, 606 (7th Cir. 2000). But new cases
(especially binding ones) can warrant reconsideration if they
would manifestly produce a different outcome. See U.S.
Fid. & Guar. Co. v. John Buck Co., No. 00 C 2460,
2001 WL 1298708, at *2 (N.D. Ill. Oct. 24, 2001) (considering
whether newly decided case warranted reconsideration of
decision on in insurance coverage); Great W. Cas. Co. v.
Marathon Oil Co., No. 99 C 3101, 2001 WL 699957, at *2
(N.D. Ill. June 21, 2001) (considering motion to reconsider
based on new case law but denying motion because “the
new cases would not compel a different result[; . . . ] none
of the cases are controlling authority for this
M.G. Skinner Decision
the September 2016 opinion, the Seventh Circuit applied the
Act to reject a claim that an insurance broker owed parties
other than the insured or proposed insured a duty of ordinary
care in M.G. Skinner & Associates Insurance Agency,
Inc. v. Norman-Spencer Agency, Inc., 845 F.3d 313,
318-20 (7th Cir. 2017). A group of owners and managers of
commercial property formed a company, called WCPP for
brevity's sake here, to purchase insurance for their
properties; the total insured value exceeded $3.5 million.
Id. at 315. WCCP hired an insurance broker to
purchase renewal coverage in 2001. Id. The broker
hired a sub-broker, and the sub-broker hired a
sub-sub-broker. See Id. at 315-16 (stating that use
of sub-brokers is common with a placement of this size). The
insurance ultimately purchased proved not to exist, and
Michael A. Ward, the person who issued the policy, received a
ten-year prison sentence for wire fraud. Id. at 316.
The third party, a company referred to here as
Norman-Spencer, became involved in the transaction when the
brokers decided to split one of the property groups from the
rest; Norman-Spencer separately underwrote insurance for the
split-off group. See id at 316. Norman-Spencer
“pushed to be involved in more business, ” but
Ward didn't allow it to participate in the WCPP deal.
See Id. As a result of the transaction,
Norman-Spencer became aware of facts about Ward and his
company which WCPP and its agents later alleged should have
been “red flags.” Id. WCPP, the insured,
brought, among other things, a negligence claim against
Norman-Spencer on the theory that Norman-Spencer owed it a
duty to warn it of the red-flag facts about Ward. See
Id. at 318.
Seventh Circuit upheld the entry of summary judgment for
Norman-Spencer. It first considered whether Norman-Spencer
could be directly liable to WCPP under § 2-2201(a).
See Id. at 318-19. “[T]here was no evidence
that any broker in the procurement chain ever requested that
Norman-Spencer serve as a sub-broker to procure insurance for
WCPP, ” so WCPP could not prevail on its claim under
the Act. Id. at 319.
Skinner's statutory analysis illuminates an
additional reason the SAC should not be dismissed. Players of
professional sports often buy personal injury insurance for
themselves; leagues buy commercial general liability
coverage. Walter Champion, Fundamentals of Sports
Law, Contracts § 16:6 (West 2016). This practice does
not appear to be entirely uniform, however. Champion,
supra, notes a 2005 case, for instance, in which the
Houston Astros bought an insurance policy for a pitcher,
albeit one insuring the salary it paid him if he became
disabled. See Id. (citing and discussing Hous.
McLane Co., Inc. v. Conn. Gen. Life Ins. Co., No. Civ.A.
H- 06-1508, 2006 WL 3050812 (S.D. Tex. Oct. 24, 2006)). Moje
played minor league hockey. As recently as 2009, the National
Hockey League (“NHL”) purchased insurance
policies covering its players, but that trend does not appear
to be universal in the world of hockey. Compare
Champion, § 16:6 (citing Jeff Klein, In Olympic
Camps, It's Skate at Your Own Risk, N.Y. Times, Aug.
6, 2009, at ¶ 14), with Elbing v. Blair, No.
2005AP1653, 2007 WL 1322101, at *1 (Wis. Ct. App. May 8,
2007) (hockey player hurt in fight sued the other player and
player's insurer rather than opposing team, the league,
or their insurers). Read against this background, the
SAC's allegations sweep broadly enough to claim that the
League intended to procure a policy like that the NHL bought
for its players naming Moje as an additional insured.
See SAC ¶¶ ...