## Facts

- Destini Azevedo alleged she was injured on August 19, 2004 while riding in a motorized watercraft on premises owned or operated by Club Getaway and related entities.
- Azevedo sued the premises/operators in federal court under diversity jurisdiction, alleging negligent operation of a boat; her complaint did not allege anything about insurance coverage.
- The defendants filed a third-party complaint against Steadfast Insurance Company, Capital Risk Management Services, Inc., and Atlantic Risk Specialists, Inc.
- The third-party complaint asserted the insurers/agents were negligent in procuring and structuring the defendants’ insurance coverage before the accident.
- The third-party complaint acknowledged the policy contained a watercraft exception and did not claim the policy actually covered Azevedo’s boating injury.
- The insurers/agents moved to dismiss the third-party complaint for lack of subject-matter jurisdiction.

## Issues

1. Whether the court had supplemental jurisdiction under 28 U.S.C. § 1367 over defendants’ third-party negligence claims concerning insurance procurement, where the original action concerned only the boating accident.
2. Whether defendants’ third-party claims were proper under Federal Rule of Civil Procedure 14 because the third-party defendants were or might be liable for all or part of Azevedo’s claim against defendants, as opposed to being liable on an independent negligence theory.

## Decision

- The court granted the insurers/agents’ motions to dismiss the third-party complaint.
- The court held it lacked supplemental jurisdiction because the insurance-procurement claims did not share a common nucleus of operative fact with Azevedo’s boating-accident negligence claim.
- The court held Rule 14 impleader was improper because the third-party claims were not derivative of defendants’ potential liability to Azevedo, but instead alleged a separate tort (negligent procurement of insurance).

## Legal Principles

- Supplemental jurisdiction under 28 U.S.C. § 1367(a) requires that the additional claims be so related to claims within original jurisdiction that they form part of the same case or controversy, typically shown by a common nucleus of operative fact.
- Federal Rule of Civil Procedure 14 permits impleader only where the third-party defendant may be liable to the defending party for all or part of the plaintiff’s claim (e.g., indemnity or contribution); it does not permit impleader of independent claims merely related in a “but for” sense to the underlying dispute.
- Where a third-party claim concerns pre-accident negotiations and drafting of insurance coverage, and the main action concerns the accident and resulting tort liability, the claims generally do not arise from the same operative facts for § 1367 purposes.

## Conclusion

The court dismissed the defendants’ third-party negligence claims against the insurers and insurance intermediaries because those claims arose from separate pre-accident insurance-procurement conduct, lacked a common nucleus of operative fact with the boating-accident tort claim, and were not derivative claims permitted by Rule 14.


Azevedo v. Club Getaway, No. 3:06-cv-01222 (VLB), 2008 WL 350479 (D. Conn. Feb. 7, 2008)