Alliance of Nonprofits v. Kipper

Summarized by:

  • Court: 9th Circuit Court of Appeals Archives
  • Area(s) of Law: Preemption
  • Date Filed: 04-08-2013
  • Case #: 11-17871
  • Judge(s)/Court Below: Circuit Judge N.R. Smith for the Court; Circuit Judges Farris and Thomas
  • Full Text Opinion

Under the Liability Risk Retention Act, which preempts state laws that prohibit a risk retention group from operating in the state, the risk retention group is not entitled to attorney's fees because the preemption is not a "right" enforceable under 42 U.S.C. § 1983.

Alliance of Nonprofits for Insurance (“ANI”), a risk retention group (“RRG”) chartered in Vermont, became a registered insurer in Nevada. ANI provided “first dollar" insurance policies, which are policies that meet the state minimum insurance requirements. ANI, however, did not possess a “certificate of authority” to conduct business in Nevada, so the Nevada Commissioner of Insurance (the “Commissioner”) issued an order prohibiting ANI from writing insurance policies in the state. ANI brought suit seeking declaratory and injunctive relief against the Commissioner's order. The district court granted summary judgment in favor of ANI and awarded ANI the attorney's fees it requested for itself and for the National Risk Retention Association (“NRRA”), ANI's amicus. The Commissioner appealed the grant of summary judgment and award of attorney's fees. The Commissioner argued that the Liability Risk Retention Act (the “LRRA”), which preempts state laws that regulate the operation of a RRG, did not preempt Nevada law. The Ninth Circuit found that the Commissioner's order prohibiting ANI, a RRG, to operate plainly fit under the LRRA and that no exemption applied. Therefore, the panel held that the summary judgment for ANI was properly granted because the LRRA preempted the Commissioner's order. Additionally, the Commissioner argued that "ANI was not entitled to attorney's fees, because preemption of state law under the LRRA is not a 'right' that can be enforced under 42 U.S.C. § 1983." Congress, in the LRRA, did not unambiguously confer a right on RRGs to be free from state law. Therefore, the panel held that the district court erred in awarding ANI attorney's fees. AFFIRMED in part, VACATED in part, and REMANDED.

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