ILNews

COA affirms Vectren, Citizens lack of standing

Jennifer Nelson
January 1, 2007
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The Indiana Court of Appeals affirmed the dismissal of a breach-of-contract complaint filed by Vectren Energy and Citizens By-products Coal Co. against Executive Risk Specialty Insurance, finding the two companies never had standing to file the complaint because they are trying to fix alleged wrongdoings done to another company, rather than themselves.

In Vectren Energy Marketing & Service, Inc., et al. v. Executive Risk Specialty Insurance Co., ProLiance Energy, LLC, et al., 82A05-0702-CV-115, Vectren and Citizens appealed the trial court's order granting Executive Risk Specialty Insurance Company's (ERISC) motion to dismiss its complaint pursuant to Indiana Trial Rule 12(B)(6). Vectren and Citizens argue they have standing to pursue the complaint, their claim is not barred by collateral estoppel, and they have sufficiently pleaded a breach of contract claim against ERISC to withstand the motion to dismiss.

Vectren and Citizens are the only two members of ProLiance, an energy trading company. All three companies have a policy through ERSIC. The City of Huntsville, Ala., filed a complaint against ProLiance and two of its employees, and a jury found ProLiance and the two employees liable for violations, fraud, breach of contract, and other issues. Based on the finding of the jury and the final judgment of $32 million in favor of the city, ERSIC denied coverage to ProLiance and the employees.

ProLiance's policy states that no coverage will be available for loss when a claim was brought by knowing, intentional, dishonest, fraudulent, or criminal wrongful acts by the insured.

ERISC filed a complaint against ProLiance and the two employees in the U.S. District Court for the Southern District of Indiana. In response, Vectren and Citizens filed a motion to intervene in the federal lawsuit to protect their purported interests. Vectren and Citizens were not named as defendants in the original lawsuit by Huntsville, they did not attempt to intervene to protect their interests in the policy, nor was any judgment entered against them.

ERISC filed a motion to dismiss Vectren's complaint stating the two companies didn't have standing to assert any claims against ERISC; the trial court dismissed Vectren and Citizen's complaint.

Chief Judge John Baker wrote in the opinion that the court found no authority establishing that Vectren and Citizen's have standing to pursue a breach-of-contract claim against ERISC based on contractual duties owed to ProLiance. Vectren and Citizens did not suffer a loss as defined by the policy as a result of the City of Huntsville's lawsuit against ProLiance, nor has either company received a claim and incurred damages, judgments, or settlements as a result of a claim. Vectren and Citizens have no personal stake in the outcome of the litigation between ERISC and ProLiance because "any loss which Vectren and Citizens will purportedly suffer would merely be derivative as a result of their relationship to ProLiance."
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  4. Oh, and you fail to mention that you deprived the father of far FAR more time than he ever did you, even requiring officers to escort the children back into his care. Please, can you see that you had a huge part in "starting the war?" Patricia, i can't understand how painfully heartbreak ithis ordeal must have been for you. I read the appellate case and was surprised to see both sides of the story because your actions were harmful to your child; more so than the fathers. The evidence wasn't re weighed. It was properly reviewed for abuse of discretion as the trial court didn't consider whether a change of circumstance occurred or follow and define the statutes that led to their decision. Allowing a child to call a boyfriend "daddy" and the father by his first name is unacceptable. The first time custody was reversed to father was for very good reason. Self reflection in how you ultimately lost primary custody is the only way you will be able heal and move forward. Forgiveness of yourself comes after recognition and I truly hope you can get past the hurt and pain to allow your child the stability and care you recognized yourself that the father provides.

  5. Patricia, i can't understand how painfully heartbreak ithis ordeal must have been for you. I read the appellate case and was surprised to see both sides of the story because your actions were harmful to your child; more so than the fathers. The evidence wasn't re weighed. It was properly reviewed for abuse of discretion as the trial court didn't consider whether a change of circumstance occurred or follow and define the statutes that led to their decision. Allowing a child to call a boyfriend "daddy" and the father by his first name is unacceptable. The first time custody was reversed to father was for very good reason. Self reflection in how you ultimately lost primary custody is the only way you will be able heal and move forward. Forgiveness of yourself comes after recognition and I truly hope you can get past the hurt and pain to allow your child the stability and care you recognized yourself that the father provides.

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