State Auto Prop. & Cas. Ins. Co. v. H.E. Neumann Co., CIVIL ACTION NO. 2:14-cv-19679
Decision Date | 23 September 2016 |
Docket Number | CIVIL ACTION NO. 2:14-cv-19679 |
Parties | STATE AUTO PROPERTY AND CASUALTY INSURANCE COMPANY, Plaintiff, v. H.E. NEUMANN COMPANY, et al., Defendants. |
Court | U.S. District Court — Southern District of West Virginia |
Pending before the Court is Plaintiff's Motion for Declaratory Judgment (the "Motion"). (ECF No. 11.) For the reasons discussed herein, the Court DENIES the Motion.1
This case concerns whether Plaintiff is obligated to indemnify and defend Defendant H.E. Neumann Company ("Defendant") for costs associated with a third-party action filed by Defendants Kevin Francis ("Francis") and Susan Francis against Defendant—and numerous other defendants—on March 19, 2010, in the Circuit Court of Kanawha County, West Virginia (the "Underlying Litigation"). Plaintiff is "a corporation with its principal place of businesslocated in Des Moines, Iowa." (ECF No. 1 ¶ 6.) Defendant is "a corporation organized under the laws of the State of West Virginia." (Id. ¶ 7.)
"[Plaintiff] issued liability policies to [Defendant] with effective dates of coverage from January 1, 2006 to January 1, 2014."2 (ECF No. 12 at 3.) Three parts of these policies are pertinent for the instant action: the Commercial General Liability Coverage Forms (the "CGLs"), the Employer's Liability Coverage Forms (the "Employer's Liability Policies"), and the Commercial Umbrella Coverage Forms (the "Umbrella Policies") (together, the "Policies"). (See, e.g., ECF No. 1 ¶¶ 22-25.) While Defendant's annual policies with Plaintiff varied—to some extent—in successive years, the relevant language for purposes of addressing Plaintiff's Motion remained materially identical during this time period. (See, e.g., ECF No. 12 at 11-15.)
Each of the Policies include a CGL, which provide the following, in pertinent part:
. . .
(ECF No. 1-2 at 1; ECF No. 1-6 at 1; ECF No. 1-10 at 34; ECF No. 1-15 at 1; ECF No. 1-19 at 1.) The CGLs include the following exclusion relating to liability arising out of Defendant's position as an employer (the "CGL Employee Exclusion Provision"):
. . .
(ECF No. 1-2 at 2; ECF No. 1-6 at 2; ECF No. 1-10 at 35; ECF No. 1-15 at 2; ECF No. 1-19 at 2.) The CGLs also provide these pertinent definitions:
. . .
10. "Leased worker" means a person leased to [Defendant] by a labor leasing firm under an agreement between [Defendant] and the labor leasing firm, to perform duties related to the conduct of [Defendant's] business. "Leased worker" does not include a "temporary worker".
. . .
13. "Occurrence" means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
. . .
(ECF No. 1-2 at 12-15; ECF No. 1-6 at 12-15; ECF No. 1-10 at 45-48; ECF No. 1-15 at 12-15; ECF No. 1-19 at 12-15.)
Defendant augmented its insurance with Plaintiff by procuring the Umbrella Policies. (See, e.g., ECF No. 1 ¶ 25.) The Umbrella Policies provide for the following coverage, in relevant part:
. . .
(3) [Plaintiff has] a right and duty to defend [Defendant] against any "suits" to which this insurance applies . . . . However, [Plaintiff] will have no duty to defend [Defendant] against any "suits" seeking damages for "bodily injury" . . . to which this insurance does not apply . . . .
. . .
(ECF No. 1-2 at 48; ECF No. 1-6 at 33; ECF No. 1-11 at 20; ECF No. 1-17 at 18; ECF No. 1-21 at 1.)3 The Umbrella Policies include definitions of the terms "bodily injury," "coverageterritory," "employee," "leased worker," "suit," and "temporary worker" that are identical to the definitions for these terms provided in the CGLs. (See ECF No. 1-2 at 64-65, 67-68; ECF No. 1-6 at 52-53; ECF No. 1-7 at 1; ECF No. 1-11 at 39-40, 42-43; ECF No. 1-17 at 37-38, 40-41; ECF No. 1-21 at 20-21, 23-24.) The Umbrella Policies also include the following unique definition of the term "occurrence":
(ECF No. 1-2 at 66; ECF No. 1-6 at 54; ECF No. 1-11 at 41; ECF No. 1-17 at 39; ECF No. 1-21 at 22.)
Defendant also supplemented its policies with Plaintiff by procuring the Employer's Liability Policies, which modify the CGLs. (See ECF No. 1-2 at 31 ( ); ECF No. 1-6 at 17 (same); ECF No. 1-11 at 10 (same); ECF No. 1-15 at 26 (same); ECF No. 1-20 at 1 (same).) While theprecise language of the Employer's Liability Policies changed between 2006 and 2010, the provisions that are pertinent here remained consistent. In particular, the Employer's Liability Policies state that "[P]laintiff will pay those sums that [Defendant] becomes legally obligated to pay as damages because of . . . 'bodily injury by disease' to [Defendant's] 'employee' to which this insurance applies." (ECF No. 1-6 at 17; ECF No. 1-11 at 10; ECF No. 1-15 at 26; ECF No. 1-20 at 1; cf. ECF No. 1-2 at 31 ( ).) The Employer's Liability Policies then provide, in pertinent part, that "[t]his insurance applies to . . . 'bodily injury by disease' only if": (1) the "'bodily injury by disease' arises out of and in the course of the injured 'employee's' employment by [Defendant];" (2) the "'bodily injury by disease' takes place in the 'coverage territory;'" and (3) the "'[b]odily injury by disease' is caused by or aggravated by conditions of [Defendant's] employment" and the "'employee's' last day of last exposure to the conditions causing or aggravating such 'bodily injury by disease' must occur during the policy period." (ECF No. 1-6 at 17; ECF No. 1-11 at 10; ECF No. 1-15 at 26; ECF No. 1-20 at 1; cf. ECF No. 1-2 at 31-32 (...
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