Hallmark National Insurance Company v. Northern Made Outlaws LLC

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF OKLAHOMA
HALLMARK NATIONAL 	)
INSURANCE COMPANY, 	)
)
Plaintiff, 	)
v. 	) 	Case No. CIV-25-1183-R
)
NORTHERN MADE OUTLAWS, 	)
LLC d/b/a Outlaws, 	)
)
Defendant, 	)
ORDER
Before the Court is Plaintiff Hallmark National Insurance Company’s Motion for
Default Judgment against Defendant Northern Made Outlaws, LLC [Doc. No. 13] pursuant
to Federal Rule of Civil Procedure 55(b). Defendant has not filed a response to the Motion
for Default Judgment within the requisite time. The matter is now at issue.
On October 9, 2025, Plaintiff filed this action pursuant to 28 U.S.C. § 2201 and
Federal Rule of Civil Procedure 57 [Doc. No. 1]. Plaintiff seeks a declaratory judgment
determining its rights and duties related to insurance coverage and defense of Outlaws. The
record reflects Defendant was served and failed to answer or plead [Doc. Nos. 2, 4]. The
Clerk entered default against Defendant on February 3, 2026 [Doc. No. 10].
The entry of default judgment is committed to the sound discretion of the trial court.
Tripodi v. Welch, 810 F.3d 761, 764 (10th Cir. 2016). Although cases should be decided
on their merits whenever possible, a default judgment is a reasonable remedy when the
adversary process has been halted because of an unresponsive party. In re Rains, 946 F.2d
731, 732-33 (10th Cir. 1991). However, before a default judgment may be entered, the
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Court must consider whether it has jurisdiction over the parties and subject matter and
“whether the unchallenged facts constitute a legitimate cause of action.” Bixler v. Foster,
596 F.3d 751, 762 (10th Cir. 2010) (citation and quotation marks omitted). Additionally, a
“default judgment may not be entered until the amount of damages has been ascertained.”
Reg’l Dist. Council v. Mile High Rodbusters, Inc., 82 F. Supp. 3d 1235, 1243 (D. Colo.
2015).
Venue is proper in this District because the acts and/or omissions giving rise to this
matter occurred in Payne County, Oklahoma. 28 U.S.C. § 1391(b)(2). The Court has
subject-matter jurisdiction over this matter pursuant to 28 U.S.C. § 1332, which provides
that district courts shall have jurisdiction “of all civil actions where the matter in
controversy exceeds . . . $75,000 . . . and is between . . . citizens of different States.” It does
not appear that the Plaintiff and Defendant are citizens of the same state. The amount in
controversy exceeds $75,000.
The Court is also satisfied it has personal jurisdiction over Defendant. “A federal
district court may exercise jurisdiction over a properly served defendant ‘who is subject to
the jurisdiction of a court of general jurisdiction where the district court is located.’”
Sanchez est. of Standage v. White County Med. Ctr., 730 F. App’x 656, 658 (10th Cir.
2018) (unpublished) (quoting F ED . R. CIV . P. 4(k)(1)(A)).
“For 	an 	individual, 	the 	paradigm 	forum 	for 	the 	exercise 	of 	general
jurisdiction is the individual’s domicile; for a corporation, it is an equivalent
place, one in which the corporation is fairly regarded as at home.” Goodyear
Dunlop Tires Ops., S.A. v. Brown, 564 U.S. 915, 919 (2011). A corporation
is “at home” where its state of incorporation and principal place of business
is. And courts have routinely applied the personal jurisdiction rules regarding
corporations to limited liability companies. Frank v. P N K (Lake Charles)
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L.L.C., 947 F.3d 331, 338 n. 10 (5th Cir. 2020) (collecting cases); see Avus
Designs, Inc. v. Grezxx, LLC, 644 F. Supp. 3d 963, 974–82 (D. Wyo. Dec. 2,
2022) (discussing the debate over what “at home” means for LLCs and
holding that an LLC should not be considered “at home” based on the
citizenship of each member).
Okla. First Cap. Fund X, Inc. v. RBR Glob., LLC, No. CIV-25-082-PRW, 2026 WL
625117, at *2 (W.D. Okla. Mar. 5, 2026) (footnotes included in-text). Defendant is an
Oklahoma Limited Liability Company and Plaintiff represents Defendant’s principal place
of business is in Stillwater, Oklahoma. Doc. No. 1, ¶ 3. Furthermore, Plaintiff served
Defendant using a professional process server, who delivered a copy of the Complaint and
Summons to Defendant’s registered agent at its place of business. Doc. Nos. 2, 4.
By virtue of Defendant’s default, the well-pleaded allegations of the Complaint are
deemed admitted as to liability. See United States v. Craighead, 176 Fed. App’x 922, 924
(10th Cir. 2006) (unpublished) (citations omitted) (by defaulting, a defendant relieves the
plaintiff of the requirement of proving the factual allegations in the complaint). Defendant
has failed to respond or defend this action. The Court thus deems Plaintiff’s allegations
admitted as to liability for its claims.
The record indicates Defendant operates a bar called Outlaws in Stillwater. Greg
Cummings owned the property upon which Outlaws operated at the time of the underlying
incident. Outlaws patron Bradley Abbott sued Outlaws, Outlaws bouncer Jacob Dowdy,
and Cummings for an assault and/or battery that Dowdy allegedly committed against
Abbott at Outlaws (“Abbott Litigation”). Hallmark insured Outlaws at the time of the
incident, but only covered assault and battery liability up to $25,000 per claim, $50,000
aggregate. Though Hallmark tendered $25,000 to Abbott’s attorney in exchange for full
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and final release of Outlaws and Dowdy, Abbott’s attorney did not respond. Hallmark later
received a Mediation Agreement wherein Outlaws agreed to be responsible for all claims
and liabilities and to indemnify Cummings in the Abbott Litigation. Hallmark represents it
did not consent to the Mediation Agreement.
Plaintiff seeks a declaration from this Court that (1) it has no further duty to pay or
defend Outlaws once the $25,000 limit of liability has been extinguished, (2) it has no duty
to cover or defend Outlaws for any part of its assumption of liability in its settlement with
Cummings, and (3) it has no duty to cover Outlaws for any award of punitive damages in
the Abbott Litigation.
“‘An action for declaratory relief is appropriate to resolve coverage disputes
between the insurer and insured.’” Scottsdale Ins. Co. v. Owl Nite Sec., No. 06-CV-0097-
CVE-SAJ, 2006 WL 3742102, at *4 (N.D. Okla. Dec. 15, 2006) (quoting First Bank of
Turley v. Fid. & Deposit Ins. Co., 928 P.2d 298, 304 n.23 (Okla. 1996)).
The insurance policy to which Plaintiff and Defendant are purportedly bound states
that Plaintiff
will pay those sums that the insured becomes legally obligated to pay as
damages because of “bodily injury” . . . to which this insurance applies. . . .
only if . . . [t]he “bodily injury” . . . is caused by an “occurrence” that takes
place in the “coverage territory.”
Doc. No. 13-1 at p. 21. “Occurrence” is defined in the policy as “an accident, including
continuous or repeated exposure to substantially the same general harmful conditions.” Id.
at p. 35.
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Despite the coverage for bodily injuries caused by occurrences, the policy also
includes an Assault and/or Battery Abuse Exclusion, id. at p. 65, which provides:
This policy does not apply to any injury sustained by any person arising in
whole or in part out of or resulting from “Assault and/or Battery” by: 1. any
insured; [or] 2. any of [Outlaws’s] Employees[.]” . . . We shall not have any
duty to defend any suit against you seeking “damages” on account of any
such injury. The intent of this endorsement is to exclude all injury sustained
by any person, including emotional distress, arising out of “Assault and/or
Battery” including but not limited to “Assault and/or Battery” caused by
negligent employment, investigation, supervision, or reporting to the proper
authorities, or failure to so report, or retention of a person for whom any
insured is or ever was legally responsible.
Assault is defined in the policy as “any attempt or threat to inflict injury to another,
including any conduct that would reasonably place another in apprehension of such injury.”
Id. Battery is defined as “any unlawful touching or use of force on someone with the intent
to harm. . . .” Id. However, the policy also includes a separate Assault and/or Battery
Liability Coverage Form, id. at p. 66, which provides:
Assault and/or Battery Liability is covered up to the limits of liability shown
below. Coverage is subject to this coverage form and the exclusions,
conditions and other terms of this policy. . . .
We will pay on your behalf all sums which you shall become legally
obligated to pay as “damages” because of injury occurring during the policy
period to any person, and arising out of assault and/or battery, caused by one
of your “employees,” or arising out of your failure to properly supervise. We
shall have the right and duty to defend any suit against you seeking such
“damages,” even if any of the allegations of the suit are groundless, false or
fraudulent, and may make such investigation and such settlement of any
claim or suit as we deem expedient, but we shall not be obligated to pay any
claim or judgment or to defend any suit after the applicable limit of our
liability has been exhausted.
The limits of liability are $25,000 per claim and $50,000 aggregate. Id.
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Whether plaintiff owes a duty to defend or indemnify depends on the
interpretation of the Policy. Under Oklahoma law, insurance policies are
contracts. See O KLA . STAT . tit., 36 § 102; First Bank of Turley, 928 P.2d at
302; Silver v. Slusher, 770 P.2d 878, 883 (Okla. 1988); Christian v.
Metropolitan Life Ins. Co., 566 P.2d 445, 448 (Okla. 1977). “An insurance
policy, like any other contract of adhesion, is liberally construed, consistent
with the object sought to be accomplished, so as to give a reasonable effect
to all of its provisions, if possible.” Dodson v. St. Paul Ins. Co., 812 P.2d
372, 376 (Okla. 1991). Parties to an insurance contract are “bound by the
terms of contract and courts will not undertake to rewrite terms thereof.” Id.
“The construction of an insurance policy should be a natural and reasonable
one, fairly construed to effectuate its purpose, and viewed in the light of
common sense so as not to bring about an absurd result.” Id.
Scottsdale, 2006 WL 3742102, at *4.
Other courts have examined assault and/or battery exclusions similar to those in the
instant policy. In Event Sec., LLC v. Essex Ins. Co., No. CIV-16-1300-C, 2017 WL
7735838, at *1-2 (W.D. Okla. Jan. 30, 2017), a similar dispute arose regarding an insurance
policy which covered bodily injuries resulting from “occurrences” defined as “accidents”
but excluded coverage for bodily injuries arising out of assaults and/or batteries. The court
found the similarly worded
assault and/or battery exclusion dispositive of the issue. Each of the claims
made by Third-Party Plaintiff Redd in the underlying action are premised on
alleged 	negligence 	by 	Plaintiff 	Event 	Security 	in 	its 	hiring, 	training,
placement, or supervision of Mr. Galyon. The alleged wrong committed by
Mr. Galyon was a civil battery. That is, Mr. Galyon engaged in an offensive
contact, which he intended, by shooting Mr. Simms. The language in the
policy specifically excludes bodily injury arising out of assault and battery
and also from any act or omission in connection with the prevention or
suppression of such, 	specifically 	noting 	that it excludes coverage for
allegations of negligent hiring, training, placement, or supervision relating to
an assault and battery. Because this language is clear and unambiguous, it
precludes coverage for the allegations raised by Third-Party Plaintiff Redd
and bars any obligation of Defendant Evanston to indemnify or defend
Plaintiff Event Security.
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Id. at *2. See also Essex Ins. Co. v. Bayless, No. 12-CV-226-JHP, 2013 WL 4832863, at
*5 (E.D. Okla. Sep. 10, 2023) (citing Sphere Drake Ins. P.L.C. v. D’Errico, 4 F. App’x
660, 662-63 (10th Cir. 2001) (unpublished); Penley v. Gulf Ins. Co., 414 P.2d 305, 308
(Okla. 1966)) (insurance policy’s clear limit of coverage to bodily injury caused by
“occurrences” defined as “accidents” did not extend to intentional torts, which negate the
existence of an accident under Oklahoma law) (citation omitted).
Here, Abbott purports to bring claims against Defendant at least partially based upon
the Defendant’s alleged negligence in its hiring, training, and supervision of Dowdy. The
alleged wrongs committed by Dowdy are assault and battery.1 Accordingly, due to the
language in the policy, and considering Defendant’s failure to present any persuasive
argument or authority to the contrary, to the extent Abbott contends the alleged wrong
committed by Dowdy was assault and/or battery, and to the extent he contends Defendant
was negligent in supervising Dowdy in connection with that assault and/or battery, the
policy bars any obligation of Hallmark to indemnify or defend Plaintiff after the stated
policy limit of $25,000 has been extinguished.
Furthermore, the Assault and/or Battery Liability Coverage Form also explicitly
states that the policy does not apply to “‘bodily injury’ . . . for which the insured is obligated
to pay damages by reason of the assumption of liability in a contract or agreement.” Doc.
No. 13-1, at p. 22; see also id. at p. 66. In the absence of arguments to the contrary, this
provision operates to insulate Plaintiff from liability based on Outlaws’s assumption of
1 The state court Petition alleges Dowdy “assaulted and/or battered and/or negligently
struck” Abbott. Doc. No. 1-1, ¶ 7.
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liability in the Mediation Agreement. And finally, the recovery of punitive damages is also
excluded by the Assault and/or Battery Liability Coverage Form. Doc. No. 13-1, at p. 66
(“This policy does not apply . . . to any claim for punitive or exemplary damages.”).
Accordingly, Plaintiff’s Motion for Default Final Judgment against Defendant
Northern Made Outlaws, LLC [Doc. No. 13] is GRANTED. To the extent the underlying
wrong is assault and/or battery, and to the extent Abbott purports to bring claims against
Defendant based on its negligence in its supervision of Dowdy in connection with that
assault and/or battery, Hallmark has no duty to pay or defend Outlaws (1) once the $25,000
limit of liability has been extinguished, (2) for its assumption of liability in its settlement
with Cummings, or (3) for any award of punitive damages in the Abbott Litigation.
Judgment is entered in favor of Plaintiff and against Defendant Outlaws.
IT IS SO ORDERED this 20 th day of April, 2026.
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