Liberty Univ., Inc. v. Citizens Ins. Co. of Am.

• Decision Date: 16 April 2014
• Docket Number: Case No. 6:13–cv–00033.
• Citation: Liberty Univ., Inc. v. Citizens Ins. Co. of Am., 16 F. Supp. 3d 636 (W.D. Va. 2014)
• Court: U.S. District Court — Western District of Virginia
• Parties: LIBERTY UNIVERSITY, INC., Plaintiff, v. CITIZENS INSURANCE CO. OF AMERICA, Hanover American Insurance Co., and Hanover Insurance Co., Defendants.

16 F.Supp.3d 636

LIBERTY UNIVERSITY, INC., Plaintiff

v.CITIZENS INSURANCE CO. OF AMERICA, Hanover American Insurance Co., and Hanover Insurance Co., Defendants.

Case No. 6:13–cv–00033.

United States District Court, W.D. Virginia, Lynchburg Division.

Signed April 16, 2014.

Calvin Wooding Fowler, Jr., Harold Edward Johnson, Williams Mullen, Richmond, VA, for Plaintiff.

John Peter Malloy, Robinson & Cole, LLP, Hartford, CT, Thomas Simpson Garrett, Harman Claytor Corrigan & Wellman, Richmond, VA, for Defendants.

MEMORANDUM OPINION

NORMAN K. MOON, District Judge.

This case comes before the Court upon the parties' cross motions for summary judgment(dockets nos. 39 and 42), filed on January 31, 2014.Liberty University, Inc.(“Plaintiff” or “Liberty”) filed this action, seeking a declaration from this Court that Citizens Insurance Company of America, Hanover American Insurance Company, and Hanover Insurance Company(collectively, “Defendants” or “Hanover”) have a duty to defend Liberty against claims made in an amended complaint by Janet Jenkins(“Jenkins Complaint”) in the United States District Court in the District of Vermont,¹ based on insurance policies issued by Hanover to Liberty.In its June 28, 2013 amended complaint (“Amended Complaint”), Liberty seeks reimbursement of the costs, fees, and expenses Hanover allegedly owes Liberty for breaching its duty to defend and indemnify² under the policies.Hanover disputes that Liberty is covered under the policies at issue.This Court heard argument on the fully-briefed motions for summary judgment on February 27, 2014.

Jurisdiction over this case is proper pursuant to 28 U.S.C. § 1332, as the parties are completely diverse and the amount in controversy exceeds $75,000.Personal jurisdiction and venue are also proper in this Court.For the reasons stated below, I find Hanover has a duty to defend Liberty under all the insurance policies at issue, in relation to the Jenkins Complaint, filed on Nov. 26, 2012, in Jenkins v. Miller et al.,No. 2:12–cv–00184–wks, in the District of Vermont.I will therefore grant Liberty's motion for summary judgment(docket no. 39) in full, and deny Hanover's motion for summary judgment(docket no. 42) in full.

I.Background

Liberty University is a Virginia corporation that operates Liberty University and the Liberty University School of Law in Lynchburg, Virginia.Citizens Insurance Company of America, Hanover American Insurance Company, and Hanover Insurance Company are corporations organized under the laws of Michigan and New Hampshire, which regularly conduct business in Virginia and have principal places of business in Michigan and Massachusetts.Each of these companies issued at least one insurance policy to Liberty that underlies this dispute.

Four³ different policies issued to Liberty are at issue: (1) the Commercial General Liability (“CGL”) Policy, number ZZR 4908180–00, issued by Hanover American Insurance Company for the policy period of February 1, 2009, to February 1, 2010; (2) the Umbrella Policy (“2009–2010 Umbrella Policy” or “CGL Umbrella Policy”), number UHR 4908175–00, issued by Hanover Insurance Company for the policy period of February 1, 2009, to February 1, 2010; (3) the School and Educators Legal Liability Endorsement (“SELL Endorsement”) to the 2012–2013 commercial general liability policy, number ZBR–4908180–03, issued by Citizens Insurance Company of America for the policy period of February 1, 2012, to February 1, 2013; and (4) the 2012–2013 Umbrella Policy (“2012–2013 Umbrella Policy”), number UHR 4908175–03, issued by Hanover Insurance Company for the policy period of February 1, 2012, to February 1, 2013.Am. Compl. ¶¶ 8–10;Defs.' Mot. forSumm. J. ¶¶ 8–9.

The 2009–2010 CGL Policy provides coverage for claims made against Liberty for “bodily injury,”“property damage,” and “personal and advertising injury” arising from an “occurrence” taking place during the policy period.Pl.'s Mot. for Summ. J. 10; J.A. Ex. B. The CGL Umbrella Policy is effective for the same dates as the CGL Policy and provides coverage for “the ‘ultimate net loss' in excess of the ‘retained limit’ ” for the same eventualities: bodily injury, property damage, and personal and advertising injury, defined in the same way as in the CGL Policy.CGL Umbrella Policy, J.A. Ex. C, at H–0015–H–0016, H–0018–H–0019, H–0027–H–0028, H–0031.Since the CGL and CGL Umbrella Policies apply here to the same eventualities, with the same exclusions and definitions, Liberty and Hanover have adopted their arguments for the CGL Policy and rely on those arguments as to whether the CGL Umbrella Policy covers Liberty and creates a duty for Hanover to defend.SeePl.'s Mot. forSumm. J. 21;Defs.' Mot. forSumm. J. 18;Defs.' Resp. to Pl.'s Mot. forSumm. J. 20.

The 2012–2013 SELL Endorsement covers claims made against Liberty that were first asserted in the relevant policy period and based on “wrongful acts” by Liberty.Pl.'s Mot. for Summ. J. 10; J.A. Ex. D.As with the CGL Umbrella Policy, the parties rely on their arguments regarding the SELL Endorsement as to whether the SELL Endorsement to the 2012–2013 Umbrella Policy provides coverage for any “wrongful acts” by Liberty.SeePl.'s Mot. forSumm. J. 25;Defs.' Mot. forSumm. J. 31;Defs.' Resp. to Pl.'s Mot. forSumm. J. 23–24;J.A. Ex. E, atH–0325–H–0326, H–0329–H0330, H–0338–H–0341, H–0343, H–0358–H–0360, H–0371.

The parties have summarized the facts pertinent to this case in their motions for summary judgment, and they were enumerated in the Jenkins Complaint.⁴In 2002, Janet Jenkins(“Jenkins”) and Lisa Miller(“Miller”) were united in a same sex civil union in Vermont when their daughter Isabella Miller–Jenkins(“Isabella”) was born.Pl.'s Mot. for Summ. J. 6;Jenkins Compl.¶ 19.In 2004, Miller converted to Christianity, began to believe that “homosexuality was sinful and that Isabella should be shielded from exposure to the ‘lifestyle,’ ” and moved with Isabella to Winchester, Virginia.Pl.'s Mot. for Summ. J. 7;Jenkins Compl.¶ 20.Miller sought to legally dissolve her civil union with Jenkins in 2004 and between 2004 and 2009, Miller and Jenkins “were engaged in litigation regarding their respective parental rights and custody over Isabella.”Pl.'s Mot. forSumm. J. 7;Jenkins Compl.¶¶ 19–20.During this time, Miller repeatedly violated the orders of courts in Vermont and Virginia that granted Jenkins certain custody and visitation rights.

Beginning in 2004, Liberty University and its related law firm, Liberty Counsel, LLC, began to represent Miller in her custody and dissolution disputes.The Jenkins Complaint alleged that Miller's “lead attorneys were Dean of the [Liberty] Law School Mathew Staver, and Rena Lindevaldsen, a law professor there.”Jenkins Compl.¶ 22.In April 2007, Miller and Jenkins' civil union was dissolved after a final, contested hearing at which Miller swore to “comply with court orders” regarding Jenkins' contact with Isabella.Jenkins Compl.¶ 23.Miller complied with many such court orders throughout 2007, but in the spring of 2008she moved with Isabella to Lynchburg, Virginia, joined Thomas Road Baptist Church (“TRBC”), and thereafter was “counseled by church members and pastors not to allow contact between Isabella and Janet Jenkins.”Jenkins Compl.¶¶ 24–25.TRBC allegedly provided Miller “with housing, a job [at Liberty Christian Academy,] and a vehicle.”Jenkins Compl.¶ 25.According to the Jenkins Complaint, “Liberty University is held out as a ‘related ministry’ of Thomas Road Baptist Church,” but the church is a separate corporation in Virginia.Jenkins Compl.¶ 16.

At TRBC, Miller developed a friendship with TRBC member Linda Wall, who allegedly agreed Miller should “flee with Isabella” and later helped to organize the “Protect Isabella Coalition[ (“PIC”) ] ... to prevent court ordered contact between Isabella Miller–Jenkins and Janet Jenkins.”Jenkins Compl.¶¶ 22, 26–27.“Upon information and belief,” the Jenkins Complaint alleged that “President of Liberty University, Jerry Falwell, Jr. donated substantial sums to the PIC to enable it to produce television and radio commercials condemning the parent-child contact between Janet Jenkins and Isabella Miller–Jenkins as an act of tyranny.”Jenkins Compl.¶ 27.Miller's “attorneys had established a Facebook site and other social media to solicit donations to their organization on behalf of Lisa Miller, and the Facebook site was also used to promote the activities of Lisa Miller and the PIC.”Jenkins Compl.¶ 27.

In 2009, after Miller defied various court orders regarding visitation between Jenkins and Isabella, motions were filed and hearings were held in the Vermont and Virginia courts on the future status of Isabella's custody and on whether to hold Miller in contempt.Jenkins Compl.¶¶ 28–31.Allegedly, “by the late summer of 2009, Lisa Miller and her co-conspirators had devised a plan to kidnap Isabella and avoid detection by infiltrating the Beachy Amish–Mennonite Christian Brotherhood to enable [Miller's] abduction of Isabella.”Jenkins Compl.¶ 34.On August 25, 2009, a Virginia court held Miller in contempt and “fined her $100 per day for any future days of missed contact” between Isabella and Jenkins.Jenkins Compl.¶ 31.Miller appeared at the hearing and held a press conference, at which her attorneys Staver and Lindevaldsen were present.On September 4, 2009, after a hearing at which Miller's attorneys appeared by telephone, a Vermont court ordered contact between Jenkins and Isabella from September 25, 2009 until September 27, 2009.Jenkins Compl.¶ 32.

Beginning in late May 2009, Miller allegedly began making contact with individual defendants who were involved with Response Unlimited, Inc., and the Beachy Amish–Mennonite Christian Brotherhood (hereinafter “Brotherhood”) to arrange transportation and living arrangements for herself and Isabella outside of the United States.This included initially making...