Opinion
No. CV06-5000410
November 5, 2007
FACTS
Before the court are motions for summary judgment filed by the defendant, Zurich American Insurance (Zurich), and the plaintiffs, the town of Plainfield, the Plainfield board of education (the board), Paul Delmonico, and Kevin Cunningham, regarding Zurich's duty to indemnify the plaintiffs in connection with a prior lawsuit.
The underlying action was filed in federal district court by John Kennerson in 2005. In his amended complaint, Kennerson alleged that Plainfield hired Turner Construction Company (Turner) as a general contractor to build a new high school, and Kennerson began working at the school for subcontractor Select Energy Contracting, Inc. (Select) in April 2004. In July 2005, Kennerson found a discarded WWII plaque in a dumpster at the school. He retrieved it and took it to a VFW Post in Plainfield. Kennerson asked the post commander to display the plaque on the wall, which the commander agreed to do.
On August 15, 2005, Kennerson noticed mold on some ducts at the construction site, and learned that Turner had told insulators to wipe off the mold. Kennerson instructed the insulators to cease wiping off the mold because the mold could also be present within the ducts. He then told both his supervisor and the school principal, Susan Rourke, about the mold, and the supervisor asked Kennerson to learn more about the problem. On August 16, 2005, a Turner representative viewed the mold and did not consider it to be a major issue, which concerned Kennerson. The representative failed to respond to Kennerson's queries regarding what would be done about the mold. Two days later, Kennerson visited Rourke to find out more about the mold issue per his supervisor's directive to gather more information. Kennerson alleged that after he knocked on Rourke's open door, Rourke told Kennerson to come in. Kennerson then shared with Rourke his concerns about the mold "as a taxpaying resident of Plainfield," such as the potential effects the mold might have on children attending the school, and noted that the mold problem might pervade the entire building. (Plaintiffs' Ex. B, para. 22.)
On Monday, August 22, 2005, a local news channel publicized Kennerson's salvage of the WWII plaque, and the Norwich Bulletin published a letter to the editor complimenting Kennerson and criticizing Plainfield's building committee for allowing the plaque to end up in the trash. Kennerson averred that also that day, someone referred to Kennerson as a "troublemaker" during a conversation involving Paul Delmonico, the building committee chair, and Joseph Hammond, a Turner manager, at a meeting pertaining to the mold issue. Following the "troublemaker" comment, Delmonico allegedly stated "that it was necessary to get [Kennerson] `the f — out of there.'" (Plaintiffs' Ex. B, para. 27.)
Kennerson alleged that Plainfield, the board, Delmonico, Hammond, and Kevin Cunningham (the board chair) then took action to retaliate against him. On August 22, 2005, Hammond notified Kennerson's supervisor at Select by letter that the board, with the building committee chair's (i.e., Delmonico's) "okay" had requested Kennerson's permanent removal from the high school project because Kennerson "interrupted a private meeting between the principal and one of her staff, sat down at the desk and informed her that as a tax paying citizen of the town . . . [h]e would like to know how the Town is going to fix the mold issue present throughout the (entire) building." (Plaintiffs' Ex. B, para. 28.) Hammond's letter further stated that Kennerson's actions violated contract policies. Kennerson alleged that in light of the letter, Kennerson's supervisor was "forced" to terminate him. (Plaintiffs' Ex. B, para. 29.)
According to Kennerson, his "actions and expression in connection with his salvaging the World War II memorial plaque, and the concerns he expressed regarding mold in the High School, constitute protected conduct under the First Amendment," and Hammond's letter to Select serves as an admission that the board retaliated against him because he engaged in protected first amendment conduct. (Plaintiffs' Ex. B, para. 32.) Kennerson further alleged that Hammond's claim that Kennerson violated contract policies was pretextual. He averred that on August 27, 2005, Delmonico asked the Norwich Bulletin via letter why the finder of the WWII memorabilia (i.e., Kennerson) "did not take the opportunity to point out the problem to the Board of Education and/or the building principal rather than simply turning them over to a third party." (Plaintiffs' Ex. B, para. 36.) Delmonico's letter, Kennerson alleged, made the claim that Kennerson was terminated for violating contract policies "not credible." (Plaintiffs' Ex, B, para. 36.)
In count one of his three-count complaint, Kennerson alleged retaliation in violation of the first amendment under 42 U.S.C. § 1983. More specifically, he claimed that all defendants — Plainfield, the board, Cunningham, Delmonico, and Hammond — acted and conspired under color of state law and through the actions of official decision makers "to intentionally retaliate against [Kennerson] and cause the termination of his employment because he exercised rights to speak on matters of public concern that are protected under the First Amendment . . ." (Plaintiffs' Ex. B, para. 41.) Kennerson characterized the defendants' conduct as "intentional and with malice in that it was willful, wanton, and in reckless disregard of [Kennerson's] rights." (Plaintiffs' Ex. B, para. 43.) His alleged damages included "lost wages and employment benefits, damage to reputation, emotional distress, mental anguish, humiliation, embarrassment, and loss of enjoyment of life." (Plaintiffs' Ex. B, para. 44.)
Count two outlined a claim for intentional interference of business and contractual rights. Kennerson alleged that the defendants were aware of his employment relationship with Select, and that in conspiring to bring about his termination, they intentionally, maliciously, and unjustifiably interfered with that relationship. In count three, directed solely against Plainfield, Kennerson alleged that pursuant to General Statutes §§ 7-101a and 7-465, Plainfield would be liable for any judgment that Kennerson obtained against Cunningham or Delmonico.
According to Kennerson's complaint, these statutes "provide that a municipality shall protect and save harmless any municipal officer or municipal employee of such municipality from financial loss and expense arising out of any claim for alleged infringement of any person's civil rights, on the part of such officer or such employee while acting in the discharge of his duties."
The defendants in the underlying action settled with Kennerson, and, with the exception of Hammond, are now the plaintiffs in the current suit. On June 1, 2006, the plaintiffs filed a two-count complaint against Select and Zurich. In count one, the plaintiffs allege breach of contract indemnification against Select, claiming that because Select, rather than the plaintiffs, terminated Kennerson, the plaintiffs should not have been made liable for Kennerson's damages, and Select should have indemnified the plaintiffs as Select expressly agreed to do in a contract between Select and Plainfield. In count two, the plaintiffs allege breach of contract indemnification against Zurich, claiming that Select's Certificate of Liability Insurance with Zurich named Plainfield as an additional insured, but Zurich failed to provide insurance benefits to the plaintiffs.
It is unclear whether Hammond participated in the settlement.
Zurich now moves for summary judgment on the ground that the documentary evidence and language in the liability policy that Zurich issued to Select establish as a matter of law that the policy does not cover the plaintiffs for the claims against them in the Kennerson action. Conversely, the plaintiffs move for summary judgment on the grounds that Zurich breached its duty to defend the plaintiffs because the plaintiffs are additional insureds under the policy, certain allegations in Kennerson's complaint fall within the policy's coverage, and no exclusion clearly precludes coverage.
DISCUSSION
"Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Grey v. Stamford Health System, Inc., 282 Conn. 745, 750, 924 A.2d 831 (2007). "When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue . . . It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17-45]." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006).
"[B]efore a document may be considered by the court in support of a motion for summary judgment, `there must be a preliminary showing of [the document's] genuineness, i.e., that the proffered item of evidence is what its proponent claims it to be. The requirement of authentication applies to all types of evidence, including writings . . .' Conn. Code Evid. § 9-1(a), commentary. Documents in support of or in opposition to a motion for summary judgment may be authenticated in a variety of ways, including, but not limited to, a certified copy of a document or the addition of an affidavit by a person with personal knowledge that the offered evidence is a true and accurate representation of what its proponent claims it to be." New Haven v. Pantani, 89 Conn.App. 675, 679, 874 A.2d 849 (2005). The court notes that Zurich provided a single sparse affidavit purporting to cover all of its submissions, while Plainfield provided detailed affidavits for certain documents, but no affidavits for others, making compliance with § 9-1(a) questionable. Nevertheless, because neither side has objected to the other's submissions, the court has considered all documents presented. See Barlow v. Palmer, 96 Conn.App. 88, 92, 898 A.2d 835 (2006) (court has discretion to interpret evidentiary rules "liberally").
The plaintiffs contend that there is a conflict of law with respect to Zurich's duty to defend. They assert that in Connecticut, "the insurer's duty to defend is measured by the allegations of the complaint," quoting Flint v. Universal Machine Co., 238 Conn. 637, 646, 679 A.2d 929 (1996). By contrast, in Massachusetts, "the duty to defend is based on the facts alleged in the complaint and those facts which are known by the insurer;" Boston Symphony Orchestra, Inc. v. Commercial Union Insurance Co., 406 Mass. 7, 10-11, 545 N.E.2d 1156 (1989); meaning that extrinsic facts can be used to determine whether a claim is covered. The plaintiffs further argue that Massachusetts law governs the current case.
In Interface Flooring Systems, Inc. v. Aetna Casualty Surety Co., 261 Conn. 601, 608, 804 A.2d 201 (2002), the Connecticut Supreme Court discussed in depth its adoption of "the `most significant relationship' approach of the Restatement (Second) of Conflict of Laws, for analyzing choice of law issues involving contracts." The court explicated that "[t]he starting point under the `most significant relationship' approach is § 188 of the Restatement (Second) of the Conflict of Laws, which provides in relevant part: `(1) The rights and duties of the parties with respect to an issue in contract are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the transaction and the parties under the principles stated in § 6.'" Id., 608-09.
The Interface Court further stated the following: "[Section] 6(2) of the Restatement (Second) [of Conflict of Laws], which is applicable to all substantive areas, sets forth seven overarching considerations in determining which state has the `most significant relationship:' `(a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, (d) the protection of justified expectations, (e) the basic policies underlying the particular field of law, (f) certainty, predictability and uniformity of result, and (g) ease in the determination and application of the law to be applied."
"Section 188(2) [of the Restatement (Second) of Conflict of Laws] lists five contacts to be considered in applying the principles set forth in § 6 to a contract dispute: `(a) the place of contracting, (b) the place of negotiation of the contract, (c) the place of performance, (d) the location of the subject matter of the contract, and (e) the domicile, residence, nationality, place of incorporation and place of business of the parties.'" (Internal quotation marks omitted.) Id., 609.
Lastly, the Interface Court explained that "Section 188(3) of the Restatement (Second) establishes a general presumption with regard to contracts, namely, that `[w]hen the place of negotiation and the place of performance are in the same state, the local law of this state will usually be applied . . . except when the principles stated in § 6 require application of some other law.' 1 Restatement (Second), supra, § 188, comment (f), pp. 582-83. In adopting § 188 of the Restatement (Second) in Reichhold Chemicals, Inc., we described it as creating a presumption in favor of the application of the law of the state where `the bulk of the contracting transactions took place . . .'" Id., 609-10.
The foregoing makes clear that a choice of law analysis is a laborious process involving numerous considerations. The plaintiffs, however, did not provide this court with any detailed analysis of the numerous factors mentioned in Interface.
To support their position that Massachusetts law applies, the plaintiffs point primarily to the fact that two of the named insureds under Zurich's policy, Select (Kennerson's employer and a party to the construction contract with Plainfield) and Select Energy Services, Inc. (which has its principal office in Massachusetts and many additional offices throughout the country), are incorporated in Massachusetts. The plaintiffs also argue that the Zurich policy was issued in Massachusetts, and claim that Select "performed operations" in Massachusetts. Additionally, they reason that both Zurich and Select could have anticipated being sued in Massachusetts. The plaintiffs further contend that other states linked to this lawsuit, namely Connecticut (the plaintiffs' location) and New York (the state in which Zurich is domiciled, according to the plaintiffs), do not have overriding policy interests in applying their laws in this instance.
The plaintiffs do not provide any information regarding certain elements of § 188(2) of the Restatement (Second), such as the place of negotiation of the contract. Furthermore, they gloss over the fact that the current dispute is not between Select and Zurich, but rather between the additional insureds, who are based in Connecticut, and Zurich. Additionally, the plaintiffs' treatment of the seven factors listed in § 6(2) of the Restatement (Second) is cursory. The plaintiffs summarily discuss the protection of justified expectations and the public policies of Massachusetts and Connecticut, but not of New York, and do not address other factors at all.
Although Zurich apparently concedes in its reply brief that Plainfield is an additional insured under Select's policy with Zurich, it argues that certain language in the policy extending coverage to executive officers and directors does not apply to Plainfield's officers and directors (i.e., plaintiffs Cunningham and Delmonico). Moreover, Zurich is silent with respect to coverage for the board. Because Zurich had no duty to defend whether the policy covers only one plaintiff or all four, these issues are immaterial.
Luckily, the choice of law issue is of little consequence here. The plaintiffs assert that "[w]ith the exception of consideration of evidence extrinsic to the Complaint, Massachusetts and Connecticut law regarding an insurer's duty to defend are nearly identical, with Massachusetts law being slightly more favorable to an insured." (Plaintiffs' Br., 13.) The Connecticut Supreme Court, however, recently determined that extrinsic facts known to an insurer may be relevant to a duty-to-defend analysis. See Hartford Casualty Ins. Co. v. Litchfield Mutual Fire Ins. Co., 274 Conn. 457, 466-67, 876 A.2d 1139 (2005). Moreover, as Zurich correctly argues, the plaintiffs have not identified any extrinsic facts relevant to the analysis of Zurich's duty to defend. Accordingly, it makes no difference whether Connecticut or Massachusetts law is applied to the current case.
The only extrinsic evidence upon which the plaintiffs appear to rely is a letter from Kennerson's lawyer to Plainfield, stating that Select was forced to fire Kennerson because Select had no work for him other than the Plainfield High School project. According to the plaintiffs, this letter reveals that the plaintiffs could not have known that Kennerson would be terminated because of the plaintiffs' actions. The plaintiffs' interpretation is directly contradicted by language in Kennerson's complaint in which Kennerson states that the plaintiffs specifically sought his termination. In any case, the outcome of this court's duty-to-defend analysis does not hinge on what the plaintiffs did or did not know regarding Kennerson's termination. Thus, the letter does not bolster any of the plaintiffs' arguments.
The plaintiffs concede that Kennerson's complaint does not contain claims covered by Coverage A of the Zurich policy, but assert that coverage exists under Coverage B, entitled "Personal and Advertising Injury Liability." Coverage B states in relevant part: "We will pay those sums that the insured becomes legally obligated to pay as damages because of `personal and advertising injury' to which this insurance applies. We will have the right and duty to defend the insured against any `suit' seeking those damages. However, we will have no duty to defend the insured against any `suit' seeking damages for `personal and advertising injury' to which this insurance does not apply." (Zurich's Ex. M, D 661.) The policy defines "personal and advertising injury" to mean "injury, including consequential `bodily injury,'" arising out of "[o]ral or written publication, in any manner, of material that slanders or libels a person or organization or disparages a person's or organization's goods, products or services or "[o]ral or written publication, in any manner, of material that violates a person's right of privacy," among other things. (Zurich's Ex. M, D 670.)
The Zurich policy also includes numerous coverage exclusions. For instance, there is no coverage for "`[p]ersonal and advertising injury' caused by or at the direction of the insured with the knowledge that the act would violate the rights of another and would inflict `personal and advertising injury.'" (Zurich's Ex. M, D 662.) Furthermore, no coverage exists for "`[p]ersonal and advertising injury' to: (1) A person arising out of any: (a) Refusal to employ that person; (b) Termination of that person's employment; or (c) Employment-related practices, policies, acts or omissions, such as coercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation or discrimination directed at that person . . ." (Zurich's Ex. M, D 629.) Coverage is excluded "[w]hether the insured may be liable as an employer or in any other capacity . . ." (Zurich's Ex. M, D 629.)
Additionally, the Zurich policy includes the following language: "Who is an Insured is amended to include as an additional insured the person(s) or organization(s) shown in the Schedule, but only with respect to liability for `bodily injury,' `property damage' or `personal and advertising injury' caused, in whole or in part, by your acts or omissions or the acts or omissions of those acting on your behalf: A. In the performance of your ongoing operations; or B. In connection with your premises owned by or rented to you." (Zurich's Ex. M, D 630.) "You" and "your" are defined later in the policy to mean the Named Insured, in this case, Select. (Zurich's Ex. M, D 657.) Accordingly, the plaintiffs' policy coverage is limited to liability for "personal and advertising injury" caused in whole or in part by Select's acts or omissions or the acts or omissions of those acting on Select's behalf.
The plaintiffs argue that although Kennerson never explicitly stated claims for slander, libel, or invasion of privacy by false light, a liberal reading of the complaint reveals that the facts pleaded outline such claims. They rely on Massachusetts' Supreme Judicial Court's determination that the process of assessing whether an insurance company has a duty to defend "is not one of looking at the legal theory enunciated by the pleader but of envisaging what kinds of losses may be proved as lying within the range of the allegations of the complaint, and then seeing whether any such loss fits the expectation of protective insurance reasonably generated by the terms of the policy." (Internal quotation marks omitted.) Boston Symphony Orchestra, Inc. v. Commercial Union Insurance Co., 406 Mass. 7, 12-13, 545 N.E.2d 1156 (1989). More specifically, "[t]he question . . . [is] whether the allegations of the complaint `state or adumbrate a claim covered by the policy terms.'" Id., 11. Zurich posits that the complaint does not adumbrate these claims, and moreover, there is no coverage because all acts alleged in the complaint were committed by the plaintiffs, not Select.
The court first addresses the assertion that Kennerson's complaint adumbrates a claim for invasion of privacy by false light. To establish such a claim, a plaintiff must show that "(a) the false light in which the other was placed would be highly offensive to a reasonable person, and (b) the actor had knowledge of or acted in reckless disregard as to the falsity of the publicized matter and the false light in which the other would be placed." (Internal quotation marks omitted.) Honan v. Dimyan, 52 Conn.App. 123, 132-33, 726 A.2d 613, cert. denied, 249 Conn. 909, 733 A.2d 227 (1999).
The parties do not dispute that Connecticut law governs the tort issues in this case; indeed, both sides cite Connecticut law for the majority of their assertions. Because the allegedly tortious acts suffered by Kennerson occurred in Connecticut, this court also applies Connecticut law when relevant. See Macomber v. Travelers Property Casualty Corp., 277 Conn. 617, 640, 894 A.2d 240 (2006) ("Under Connecticut choice of law rules, for the plaintiff's claims that sound in tort . . . we apply the law of the state in which the plaintiff was injured, unless to do so would produce an arbitrary or irrational result").
The portions of Kennerson's complaint referenced by the plaintiffs in support of their argument do not give rise to a false light claim, and the plaintiffs have not pointed to extrinsic evidence suggesting otherwise. The plaintiffs assert that "Kennerson alleged he was publicized as a troublemaker to his employer, Select, and that he was falsely alleged to have violated the terms of Select's contract with the Town of Plainfield." However, Kennerson in no way elaborated on the "troublemaker" comment. He did not allege that the comment was offensive; in fact, he did not even allege that the comment was false. The complaint makes clear that in referencing the "troublemaker" comment, Kennerson was only setting the stage for the retaliatory discharge that allegedly followed, not stating a claim for invasion of privacy either directly or indirectly.
More importantly, the "troublemaker" comment cannot serve as a basis for coverage because Select is not alleged to be involved in publicizing the comment. Kennerson avers that he was referred to as a "troublemaker" during a conversation involving Hammond and Delmonico, and the plaintiffs insist that the allegation must be construed to mean that either Hammond or Delmonico uttered the term. Neither Hammond nor Delmonico are Select employees. Therefore, even assuming that Kennerson's privacy was invaded, the injury cannot be attributed to Select.
Similarly, Kennerson's allegation that the plaintiffs falsely accused him of violating his contract is insufficient to trigger coverage; nothing in the complaint suggests that Select, as opposed to the plaintiffs, accused Kennerson of violating anything. Indeed, the plaintiffs are crystal clear about Select's noninvolvement in the alleged actions that purportedly bring Kennerson's complaint under the defamation and invasion of privacy umbrella, asserting that "[e]ven if Kennerson was not laid off from Select, he would still have viable, covered, legal claims against the Plaintiffs." (Plaintiffs' Br., 20.)
The plaintiffs also posit that defamation claims can be parsed from Kennerson's allegations. "A defamatory statement is defined as a communication that tends to harm the reputation of another as to lower him in the estimation of the community or to deter third persons from associating or dealing with him . . . To establish a prima facie case of defamation, the plaintiff must demonstrate that: (1) the defendant published a defamatory statement; (2) the defamatory statement identified the plaintiff to a third person; (3) the defamatory statement was published to a third person; and (4) the plaintiff's reputation suffered injury as a result of the statement." Hopkins v. O'Connor, 282 Conn. 821, 838, 925 A.2d 1030 (2007). "Slander is oral defamation . . . Libel . . . is written defamation." Gagnon v. Housatonic Valley Tourism District Commission, 92 Conn.App. 835, 848, 888 A.2d 104 (2006).
The plaintiffs argue that Kennerson has established all necessary elements of a libel claim because he alleged that: 1) the plaintiffs falsely stated that he interrupted a meeting between the principal and one of her staff members and that he was violating the terms of the construction contract between Select and Plainfield; 2) the plaintiffs published these statements to a third party, Select, via letter; and 3) Kennerson's reputation was damaged. Regardless of whether the plaintiffs' characterization of the complaint is correct, the claim is excluded from coverage, because nowhere does Kennerson allege that Select was involved in the purportedly defamatory acts. At best, Select was the passive recipient of the libelous information. The plaintiffs' argument that the "troublemaker" comment is sufficient to make out a claim for slander fails for the same reason; as explained earlier, Select had nothing to do with it.
The plaintiffs further assert that Zurich had a duty to defend because Kennerson's complaint can be interpreted to include a claim for disparagement of services. "[D]isparagement of a business' goods and services . . . is recognized by Connecticut and New York courts as a species of defamation." (Citations omitted.) QSP, Inc. v. Aetna Casualty Surety Co., 256 Conn. 343, 358, 773 A.2d 906 (2001). The plaintiffs contend that the "troublemaker" comment and the allegedly false statement that Kennerson violated the terms of Select's contract with Plainfield could have injured Kennerson's reputation as to his services. The court questions whether the allegations referenced by the plaintiffs relate in any way to Kennerson's reputation as a plumber. In any event, coverage is barred in light of the fact that Select is not alleged to be involved in the so-called disparaging acts.
The plaintiffs next argue that a duty to defend was triggered because of Kennerson's allegations that the plaintiffs violated his first amendment rights. According to the plaintiffs, the definition of "injury" in Zurich's "personal and advertising injury" clause is ambiguous. Therefore, they argue, citing Indiana law, the clause could cover violations of Kennerson's first amendment rights, which the plaintiffs claim "`arose out of' one of the enumerated personal injury offenses." (Plaintiffs' Br., 18.) The plaintiffs do not specify the offense from which the first amendment violations purportedly arose. Even if this court were to assume that Kennerson's first amendment violations arose from allegedly defamatory or disparaging comments, the plaintiffs are not entitled to coverage because Select did not cause the injury either in whole or in part, for the reasons discussed earlier.
Zurich posits that the plaintiffs are also unable to recover based on the alternative argument that any "personal or advertising injury" arose from Kennerson's termination, the only relevant act discussed in the complaint that can be traced even remotely to Select. Assuming that Kennerson's "personal and advertising injury" arose from his termination, Zurich correctly notes that such injuries are clearly excluded from the Zurich policy, as the policy states that no coverage exists for "`[p]ersonal and advertising injury' to . . . [a] person arising out of any . . . [t]ermination of that person's employment." (Zurich's Ex. M, D 629.)
The plaintiffs rely heavily on Peterborough Oil Company, Inc. v. Great American Insurance Co., 397 F.Sup.2d 230 (D.Mass. 2005) for the proposition that the employment-related exclusions are pertinent only when the person claiming "personal injury" is an employee, former employee, or prospective employee of the insured seeking coverage. Peterborough, which primarily addresses a malicious prosecution claim, as opposed to "personal injury" stemming from either termination or defamation, does not help the plaintiffs. There is no dispute that Kennerson was fired by Select. Kennerson's termination is clearly a "matter that directly concern[s] the employment relationship itself"; id., 238; and claims stemming from it are therefore barred by the employment-related exclusions.
The fact that the plaintiffs did not terminate Kennerson themselves is irrelevant. The court agrees with the plaintiffs that Zurich must "evaluate the duty to defend and the policy exclusions independently with respect to each insured seeking coverage." (Plaintiffs' Br., 26.) Kennerson alleges, however, that the plaintiffs are liable for his termination, and the Zurich policy specifically excludes termination claims "[w]hether the insured may be liable as an employer or in any other capacity." (Emphasis added.) (Zurich's Ex. M, D 629.)
While few courts appear to have analyzed the "in any other capacity" provision in depth at this juncture, a Connecticut case is directly on point. In Gottier's Furniture v. La Pointe, Superior Court, judicial district of Tolland, Docket No. CV 04 0084606 (October 26, 2006, Sferrazza, J.), Janet LaPointe, a member of an LLC, sued a fellow member, Robert Gottier, for defamation and intentional infliction of emotional distress, among other things. Gottier's insurance company refused to defend and indemnify Gottier, asserting that such claims fell within an "employment-related practices" exclusion nearly identical to Zurich's. Id. Despite Gottier's contention that the exclusion did not apply because Gottier was not LaPointe's employer and LaPointe was a member, not an employee, of the company, the court found that the policy "explicitly expands the reach of the exclusion of coverage . . . whether the insured has acted as an employer or in any other capacity." (Internal quotation marks omitted.) Id.; see also Green v. Travelers Insurance Co., 51 Mass.App.Ct. 1103, 2001 Mass.App. LEXIS 260 (2001) (finding that because "the plain language of the policy not only excludes coverage for employers but also excludes coverage for an insured who may be liable in any other capacity," insurance coverage for acts alleged in the complaint was excluded for both employers and insureds who were not employers). The plaintiffs have not presented a compelling reason for this court to deviate from this logic.
Zurich contends that the exclusion for "`personal and advertising injury' caused by or at the direction of the insured with the knowledge that the act would violate the rights of another and would inflict `personal and advertising injury'" serves as an additional bar to coverage under its policy. (Zurich's Ex. M, D 662.) Zurich also argues that even assuming the Kennerson complaint alleges claims for defamation and invasion of privacy, those claims are barred because they stem from "[e]mployment-related practices, policies, acts or omissions, such as . . . defamation, harassment, humiliation or discrimination . . ." (Zurich's Ex. M, D 629.) The court sees no need to address these arguments, as summary judgment in Zurich's favor is clearly warranted on other grounds.
Accordingly, Zurich's motion for summary judgment is granted, and the plaintiffs' motion for summary judgment is denied.
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