Free Notice (Other) - District Court of California - California

Case 5:08-cv-00555-RS

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1 PETER S. HECKER (Bar No. 66159) ANNA S. McLEAN (Bar No. 142233) 2 HELLER EHRMAN LLP 333 Bush Street 3 San Francisco, California 94104-2878 Telephone: (415) 772-6080 4 Facsimile: (415) 772-6268 [email protected] 5 [email protected] 6 FRANK BURT (Pro Hac Vice) DENISE A. FEE (Pro Hac Vice) 7 JORDEN BURT LLP 1025 Thomas Jefferson Street, NW 8 Washington, DC 20007-0805 Telephone: (202) 965-8140 9 Facsimile: (202) 965-8104 [email protected] 10 [email protected] 11 Attorneys for Defendant AMERICAN SECURITY INSURANCE COMPANY 12 13 14 15 16 17 MICHELE T. WAHL, on behalf of herself and all others similarly situated, 18 19 20 21 22 AMERICAN SECURITY INSURANCE COMPANY; and DOES 1-50, inclusive, 23 24 25 26 27 28
DEFENDANT AMERICAN SECURITY INSURANCE COMPANY'S NOTICE OF FILING OF COMPLETE EXHIBIT D IN SUPPORT OF ITS MOTION TO DISMISS; CASE NO. C08-00555-RS

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION

Case No. C08-00555-RS

Plaintiff, v.

DEFENDANT AMERICAN SECURITY INSURANCE COMPANY'S NOTICE OF FILING OF COMPLETE EXHIBIT D IN SUPPORT OF ITS MOTION TO DISMISS

Defendant.

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Pursuant to this Court's oral order granting American Security Insurance Company

2 ("ASIC") leave to file additional material in response to Michelle T. Wahl's Sur-Reply, 3 ASIC hereby files a complete copy of the document attached as Exhibit D to the First 4 Amended Complaint ("Complaint"). See Order Granting Leave to File Sur-Reply and 5 Leave to Respond, Docket No. 33, at 2 (evidencing oral order made on May 21, 2008). The 6 complete document, a two-page letter with a one-page enclosure, is attached to this Notice
1 7 as Exhibit 1.

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Exhibit 1 is an April 3, 2006, letter sent from EMC Mortgage Corporation ("EMC")

9 to Ms. Wahl, informing her that, because she allowed her Farmers policy to lapse, EMC had 10 purchased temporary insurance on her property from ASIC. Ex. 1. The letter's third page, 11 missing from plaintiff's Exhibit D attached to the Complaint, is a specimen copy of the 12 insurance binder temporarily insuring Ms. Wahl's property. Id. That page states that 13 coverage under the binder began on January 27, 2006, the same day that coverage 14 terminated on the Farmers' policy, and that the temporary coverage lasted for 60 days. Id.; 15 see also Complaint Ex. B. This is consistent with the one year policy that subsequently was 16 placed on the property, which also lists the effective date of coverage as January 27, 2006. 17 See Complaint Ex. G. 18 Ms. Wahl argued for the first time in her Sur-Reply that EMC "took no act to

19 procure substitute insurance before March 4, 2006," and as a result could not have waived 20 its protection under the Farmers LLPE until that date. Plaintiff's Sur-Reply at 3. The 21 missing third page of Exhibit D refutes that argument, further establishing that the 60-day 22 binder procured by EMC from ASIC was effective as of January 27, 2006. As is reflected 23 in the Complaint and its Exhibits, to conform with various requirements that loan collateral 24 at all times be insured, EMC and ASIC have instituted arrangements under a group master 25 policy for the issuance by ASIC of 60-day binders in the event any EMC mortgagor fails to 26 This Court may properly consider the letter in its entirety, as the first two pages are 27 appended to the Complaint and the document is integral to the Complaint. Hassan v. Spicer, No. 05-CV-1526, 2006 WL 228958 (E.D.N.Y. Jan. 31, 2006) (considering a 28 completed copy of a document offered by the defendant).
DEFENDANT AMERICAN SECURITY INSURANCE COMPANY'S NOTICE OF FILING OF COMPLETE EXHIBIT D IN SUPPORT OF ITS MOTION TO DISMISS; Case No. C08-00555-RS
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1 maintain acceptable hazard insurance on any property securing a mortgage loan to EMC. 2 See, e.g., Exhibits C and D to the Complaint. Pointing to Exhibit D, Ms. Wahl

3 enigmatically argues that the April 3, 2006 letter "is a clear admission that EMC took no act 4 to procure substitute insurance before March 4, 2006," and as a result EMC could not have 5 waived its protection under the Farmers LLPE until that date. Sur-Reply at 3. Yet Exhibit 6 D, dated April 3, 2006, and Exhibit C, a prior letter to Ms. Wahl from EMC dated February 7 27, 2006, both expressly advised that EMC had "secured temporary insurance coverage in 8 the form of a sixty-day binder through American Security Insurance" with an effective date 9 of January 27, 2006. See also Complaint ¶ 16(c) ("On 2/27/06, ASIC notified Ms. Wahl in 10 writing on EMC letterhead that EMC had purchased a temporary 60-day binder of FPI from 11 ASIC") (emphasis added). Thus, the Complaint, its Exhibits, and plaintiff's own allegations 12 demonstrate that EMC secured temporary coverage from ASIC on Ms. Wahl's property that 13 became effective simultaneously with the cancellation of Ms. Wahl's Farmers coverage. 14 The date on which EMC obtained coverage in advance from ASIC and on which

15 coverage began was January 27, 2006--as is described in the February 27, 2006 letter (Ex. 16 C), the April 3, 2006 letter (Ex. D), and the declaration page for the one-year policy (Ex. 17 G). Accordingly, EMC did not "back-date" its coverage, as Ms. Wahl alleges in the Sur18 Reply. Sur-Reply at 3. Rather, EMC cancelled coverage under the express terms of the 19 Farmers LLPE by securing alternative insurance coverage from ASIC in advance. EMC 20 obtained insurance coverage from ASIC on Ms. Wahl's property on January 27, 2006, and 21 EMC waived any coverage under the Farmers LLPE on that date, foreclosing any "overlap" 22 between the two policies. 23 24 25 26 27 28
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For the forgoing reasons, ASIC respectfully requests that this Court consider the

2 attached Exhibit 1, which is the complete document of Exhibit D to the Complaint. 3 Furthermore, after considering Exhibit 1, this Court should dismiss the Complaint for the 4 reasons set forth herein and in all of the other papers submitted in support of ASIC's motion 5 to dismiss. 6 Dated: May 23, 2008 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
DEFENDANT AMERICAN SECURITY INSURANCE COMPANY'S NOTICE OF FILING OF COMPLETE EXHIBIT D IN SUPPORT OF ITS MOTION TO DISMISS; Case No. C08-00555-RS

HELLER EHRMAN LLP By: /s/ Peter S. Hecker PETER S. HECKER Attorneys for Defendant AMERICAN SECURITY INSURANCE COMPANY

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