United States District Court, E.D. Michigan, Southern Division
Steven Whalen U.S. Magistrate Judge
ORDER DENYING ALLSTATE'S MOTION FOR SUMMARY
JUDGMENT ; GRANTING MCINTYRE'S
MOTION FOR SUMMARY JUDGMENT ; AND
GRANTING IN PART AND DENYING IN PART AMCO'S
MOTION FOR SUMMARY JUDGMENT 
J. Tarnow Senior United States District Judge
a diversity contract dispute between two insurance companies
and the estates of two victims of an auto accident.
Plaintiff, Allstate Insurance Company, Inc.
(“Allstate”) sues for a declaratory judgment that
the Personal Umbrella Policy held by insured party Michael
Stack, who was at-fault in the accident, excluded coverage
for the accident. Defendant AMCO Insurance Company
(“AMCO”) argues that the insurance policy held by
the company for which Michael Stack worked excluded coverage
for the accident. Defendants Thomas McIntyre and Sandy
Holewinski, as personal representatives of the estates of the
deceased, argue that the policy exclusions of Allstate's
Personal Umbrella Policy are inapplicable to this case, and
that Allstate is liable for costs arising from the accident.
December 12, 2017, Michael Stack was a sales executive for
Penguin Toilets, L.L.C. (Dep. of Michael Stack, Dkt. 41-4,
pg.18-22). Penguin Toilets sold toilets with an overflow
drainage system. The toilets were manufactured in China,
shipped to a warehouse in Taylor, Michigan, and then from
there shipped wholesale to various buyers. (Id.).
Michael Stack was the Senior Vice President of Sales and
Distribution and his job was to coordinate the shipments
coming in from China with the purchase orders coming in from
buyers. (Id. at 29). Michael Stack was not an
employee, however. He filed a K-1 not a W-2 with the IRS.
(Id. at 30-31). He owned 3 percent of the company
and received guaranteed payment in the amount of $42, 000 per
year as compensation for his services. (Id. at
29-30). His brother, Patrick Stack, was his supervisor and
the company's managing member. (Id. at 31).
Stack would go to the warehouse in Taylor “a couple of
times a week.” (Id. at 35). It was a 45-minute
drive from Pontiac Trail to M-5 to I-275 to Eureka.
(Id.). On the morning of December 12, 2017, Stack
was heading down to the warehouse because he “had some
paperwork to take down there.” (Id.). The
paperwork consisted of bills of lading and purchase orders
that he needed to give to someone in the warehouse so that
the shipment of toilets that came in from China could be
shipped out to the buyers. He had received this paperwork by
email. His brother, Patrick Stack, testified that there was
no need for Michael to go to the warehouse to deliver the
paperwork, because he could simply email the paperwork to the
warehouse and they would prepare the shipment and put it on
the dock. (Dep. of Patrick Stack, Dkt. 41-5, pg. 60-62).
Stack was also a recovering alcoholic. He had been sober for
25 years prior to 2017, but he relapsed and in January of
2017 checked himself into an inpatient clinic for ten days.
(Dep. of Michael Stack pg. 9-13). He also attended Alcoholics
Anonymous meetings and took medication for high blood
pressure and depression. (Id.).
morning of December 12, 2017, Michael Stack drank. (Dep. of
Michael Stack pg. 37; Michigan Department of State Police
Report, Dkt. 44-5, pg. 4). The quantity that he drank is
disputed and ultimately not relevant to the Court's
holding. While he was en route to the Taylor warehouse, Stack
also took a business call to discuss sales. At around 10:25
a.m., while driving on I-275, Stack crossed the median and
drove his GMC Envoy into incoming traffic at around 75 m.p.h.
He continued driving against traffic until his SUV struck an
oncoming car. (See Dkt. 60). Michael Stack survived.
The two occupants of the car he struck did not.
filed suit on September 25, 2018, seeking declaratory relief
only. [Dkt. # 1]. On April 16, 2019, Plaintiff moved for
Summary Judgment . Defendant Thomas McIntyre moved for
Summary Judgment  the next day, and, on May 10, 2019,
Defendant AMCO moved for Summary Judgment . These motions
are fully briefed, and a hearing was held on November 20,
2019. Sandy Holewinski did not file a Motion for Summary
Judgment, but she did file a Reply brief  that Plaintiff
moved to strike  as inconsistent with local
Plaintiff seeks a declaratory judgment, the Declaratory
Judgment Act states that “[i]n a case of actual
controversy within its jurisdiction ... any court of the
United States ... may declare the rights and other legal
relations of any interested party seeking such
declaration.” 28 U.S.C. § 2201. “The
Declaratory Judgment Act was an authorization, not a command.
It gave the federal courts competence to make a declaration
of rights; it did not impose a duty to do so.” Pub.
Affairs Assocs., Inc. v. Rickover, 369 U.S. 111, 112
(1962). “A declaratory judgment, like other forms of
equitable relief, should be granted only as a matter of
judicial discretion, exercised in the public interest.”
Eccles v. Peoples Bank, 333 U.S. 426, 431 (1948).
The statute is best read as “enabling act, which
confers a discretion on the courts rather than an absolute
right upon the litigant.” Green v. Mansour,
474 U.S. 64, 72 (1985). The Sixth Circuit applies the
following two-part inquiry in determining whether a
declaratory judgment is appropriate.
The two principal criteria guiding the policy in favor of
rendering declaratory judgments are (1) when the judgment
will serve a useful purpose in clarifying and settling the
legal relations in issue, and (2) when it will terminate and
afford relief from the uncertainty, insecurity, and
controversy giving rise to the proceeding. It follows that
when neither of these results can be accomplished, the court
should decline to render the declaration prayed.
Allstate Ins. Co. v. Mercier, 913 F.2d 273, 277 (6th
Cir. 1990) (quoting E. BORCHARD, DECLARATORY JUDGMENTS 299
(2d ed. 1941)). Because these motions are for summary
judgment, the standards of Rule 56 of the ...