IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF MISSISSIPPI

SOUTHERN DIVISION

HENRY KUEHN and JUNE P. KUEHN PLAINTIFFS

VERSUS No. 1:08-cv-577-LTS-RHW

STATE FARM FIRE & CASUALTY COMPANY, et al. DEFENDANTS

STATE FARM’S MOTION FOR RECONSIDERATION OF THIS COURT’S JUNE 19, 2009
ORDER [72], LIMITED TO THE ISSUE OF DISINTERESTEDNESS

EXPEDITED BRIEFING RESPECTFULLY REQUESTED

1. State Farm, on this urgent and necessitous matter and for good cause shown, respectfully

moves for reconsideration of this Court’s June 19, 2009 Order [72] limited to the requirement that the

appraisers be disinterested, pursuant to pursuant to Fed. R. Civ. P. 59(e),1 and for expedited briefing

prior to July 22, 2008, the current date set for a hearing on “the issue of the validity of the appraisal”

[72], pursuant to Local Rule 7.2(H). State Farm is entitled to reconsideration of the Court’s Order for

the following reasons and those more fully set forth in its accompanying memorandum of law and its

prior briefing, [63], [64] & [71], incorporated herein by reference.

2. The Court’s June 19, 2009 Order [72] contains clear errors of law. Without reaching the

merits of the issue, this Court held that “the issue of whether the appraiser appointed by the Plaintiffs

was truly disinterested … is an issue properly raised in [State] Court.” [72] at 2. The policy requirement

that Plaintiffs’ appraiser, Lewis O’Leary, be disinterested is an essential element of Plaintiffs’ appraisal

claim and is properly before this Court. Plaintiffs filed this case in this Court pursuant to its original

diversity jurisdiction. Compl. [1] ¶ 5. With Plaintiffs having invoked this Court’s diversity jurisdiction,

and thus with this Court sitting in diversity, this Court is obligated to apply the same substantive law as

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By limiting its motion for reconsideration to the issues concerning this Court’s holding that “the issue of whether the
appraiser appointed by the Plaintiffs was truly disinterested … is an issue properly raised in [State] Court,” [72] at 2,
State Farm is not intending to waive, and is not waiving, any other issues it may have with the Court’s June 19, 2009
Order [72].
would a state court. Erie R.R. v. Tompkins, 304 U.S. 64 (1938). The element of Plaintiffs’ appraisal

claim that Mr. O’Leary be disinterested is no less in issue before this Court than any other policy

requirement for appraisal, such as whether the appraisal improperly made causation determinations. To

hold otherwise is clear error.

3. The Court’s June 19, 2009 Order [72], unless corrected, works a manifest injustice upon

State Farm. Evidence of Mr. O’Leary’s admittedly zealous partiality directly refutes an essential

element of Plaintiffs’ claim. But this Court erroneously held that this element of Plaintiffs’ claim is not

properly in issue before this Court and should be raised in state court. [72] at 2. To entirely exclude an

essential element of Plaintiffs’ claim deprives State Farm the opportunity to obtain summary judgment,

which would obviate the need for an evidentiary hearing. As with its erroneous exclusion on summary

judgment, even if an evidentiary hearing were required to resolve a factual dispute on this issue (and

there is none), excluding an essential element of Plaintiffs’ claim will render the proceedings before this

Court fundamentally flawed and incomplete. Further, due process requires that State Farm be afforded a

full opportunity to present every available defense, both at the summary judgment stage and at an

evidentiary hearing. This Court’s holding that the issue of Mr. O’Leary’s admitted partisanship is not

before this Court and should be raised in state court, [72] at 2, is contrary to Erie, deprives State Farm

the opportunity to present a dispositive defense to an essential element of Plaintiffs’ appraisal claim at

summary judgment and at an evidentiary hearing, and deprives State Farm of due process. Thus, the

June 19, 2009 Order [72] obliges State Farm to defend itself against Plaintiffs’ claim with one hand tied

behind its back.

4. This Court should alter its June 19, 2009 Order [72] to (i) recognize that it has

jurisdiction over all the policy provisions controlling appraisal, including disinterestedness, (ii)

recognize that Plaintiffs freely admitted that Mr. O’Leary was their zealous advocate during the

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appraisal, contrary to the disinterestedness requirement of the policy, and (iii) grant State Farm’s motion

for summary judgment [63].

5. Pursuant to Local Rule 7.2(H), State Farm respectfully moves that this Court set an

expedited briefing schedule on this motion, prior to July 22, 2008, the date set for a hearing on “the issue

of the validity of the appraisal.” [72].

Dated: July 1, 2009

Respectfully submitted,

/s/ John A. Banahan

John A. Banahan (MSB #1731)
H. Benjamin Mullen (MSB #9077)
BRYAN, NELSON, S CHROEDER,
CASTIGLIOLA & BANAHAN
1103 Jackson Avenue
Pascagoula, Mississippi 39567
(228) 762-6631

H. Scot Spragins (MSB # 7748)

H ICKMAN, GOZA & SPRAGINS, PLLC
Post Office Drawer 668
Oxford, Mississippi 38655-0668
(662) 234-4000

Attorneys for Defendant

State Farm Fire and Casualty Company

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 CERTIFICATE OF SERVICE

I, JOHN A. BANAHAN, one of the attorneys for the Defendant, STATE FARM FIRE &

CASUALTY COMPANY, do hereby certify that I have on this date electronically filed the foregoing

document with the Clerk of Court using the ECF system which sent notification of such filing to all

counsel of record.

DATED, July 1, 2009.

/s/ John A. Banahan

JOHN A. BANAHAN

John A. Banahan (MSB #1761)

H. Benjamin Mullen (MSB #9077)
BRYAN, N ELSON, SCHROEDER,
CASTIGLIOLA & BANAHAN
4105 Hospital Road, Suite 102-B
Pascagoula, Mississippi 39567
(228) 762-6631