Miles v. Sunset Logistics Inc
3:10-cv-00872
| N.D. Tex. | Apr 22, 2011Background
- Miles were involved in a August 17, 2007 hit-and-run; CMS paid conditional medical expenses for Miles.
- Miles sued Sunset Logistics, John Doe, and Bell for injuries; Sunset sought fees and pursued bad-faith relief.
- Sunset and Miles entered a Rule 11 settlement in October 2009; the Miles signed a Release/Indemnity/Assignment Agreement with Sunset.
- Miles non-suited Sunset in October 2009; Allstate later settled Miles’ claims in February 2010 and Allstate filed an interpleader in March 2010 with CMS involved.
- Assignment Agreement purported to assign Miles’ claims to Sunset; Agreement provided that each party bears its own costs and that the assignment supersedes prior understandings.
- Court grants both Sunset’s and CMS’s partial summary judgment; CMS has a priority right to reimbursement for Medicare payments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity of the Assignment | Miles contend Assignment violates Rule 11 terms | Assignment is the entire agreement and supersedes prior terms | Assignment valid; supersedes Rule 11 terms |
| Effect of Miles' prior attorney’s fees assignment | Assignment should be subject to 40% fee lien | Assignment not subject to prior attorney’s fee assignment | Not subject to prior attorney’s fee assignment; Sunset entitled to summary judgment |
| CMS right to reimbursement priority | CMS right to reimbursement is acknowledged | Dispute CMS’s asserted amount and its relation to the underlying accident | CMS has superior and priority right to reimbursement |
Key Cases Cited
- Commons West Office Condos, Limited v. Resolution Trust Corp., 5 F.3d 125 (5th Cir. 1993) (contract interpretation and ambiguity; intent from instrument)
- State Farm Fire & Casualty Company v. Gandy, 925 S.W.2d 696 (Tex. 1996) (assignments of choses in action and public policy)
- Wahlenmaier v. American Quasar Petroleum Company, 517 S.W.2d 390 (Tex. Civ. App.—El Paso Dec 18, 1974) (construction of unambiguous assignment agreement; law governs)
- Mid-South Telecommunications Company v. Best, 184 S.W.3d 386 (Tex. App.—Austin 2006) (whole-instrument contract interpretation; harmonization of terms)
- Little v. Liquid Air Corporation, 37 F.3d 1069 (5th Cir. 1994) (summary judgment standard; when evidence is sufficient to create genuine issue)
- Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574 (U.S. 1986) (required showing for genuine disputes on material facts)
- Fontenot v. Upjohn Company, 780 F.2d 1190 (5th Cir. 1986) (summary judgment standard and evidence evaluation)
- Adickes v. S.H. Kress & Co., 398 U.S. 144 (U.S. 1970) (evidence view for motion practice; burden on non-moving party)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (summary judgment burden shift; burden on movant)