Opinion
Case No. J98-24 CV (JWS)
March, 2000
I. MOTION PRESENTED
At docket 20, third-party defendants Employee Security, Inc. and Robert Sacks (collectively "ESI" unless the context requires otherwise) move for summary judgment. Defendants Vasa Brougher, Inc. and Standard Security Life Insurance Company of New York (collectively "VBI") oppose the motion and cross-move for summary judgment at docket 36. At docket 33, plaintiff NEA Alaska Health Plan Trust ("NEA") moves for summary judgment. VBI's motion at docket 36 also serves as its opposition to NEA's motion. VBI filed a timely request for oral argument. Oral argument was heard on March 14, 2000.
Docket 37.
II. BACKGROUND A. Jurisdiction
This is a contract dispute arising out of NEA's purchase of stop-loss insurance policies described further below. Jurisdiction is based on diversity.
28 U.S.C. § 1332; see Notice of Removal, docket 1 at 1-2.
B. Parties
Plaintiff NEA administers health plans for some of the collective bargaining units represented by NEA Alaska, a statewide teachers' union. Defendant Vasa Brougher, Inc. is a licensed insurance broker and an Indiana corporation with its principal place of business in Indiana. Defendant Standard Security Life Insurance Company of New York is a New York corporation with its principal place of business in New York. Third-party defendant ESI is a Maryland Corporation with its principal place of business in Maryland. ESI acted as an insurance broker and claims processor for NEA. Third-party defendant Robert Sacks ("Sacks") is ESI's president and a Maryland citizen.C. Dispute
NEA established a health plan for the Anchorage Education Association in 1996. By design, it was anticipated that premiums would cover benefits paid out under the Anchorage plan. However, NEA recognized the possibility that benefits might exceed premiums. NEA therefore purchased insurance to cover this potential risk. Such insurance is called "stop loss coverage" in the insurance industry. One authority defines "stop loss coverage" as follows:
Stop-loss coverage, in the context of employee health care plans, means that the employer is self-insured but then purchases a policy that will "stop the bleeding" at a certain point. The stop-loss policy generally insures either the employer itself or the plan, and is "triggered" if the employer's payments on the plan reach a certain point in a given year.
Stop-loss policies [generally] . . . come in one of two forms: aggregate basis and individual/family basis. In the aggregate model, the stop-loss policy will pay out when the plan's total claims exceed projected claims by a predetermined percentage. In the individual/family model, the same framework applies, except that the stop-loss policy is triggered when any single participant makes claims above a certain amount (for example, $25,000 in a given year). The point at which the stop-loss policy is triggered is called the "attachment point."
Dennis K. Schaeffer, "Insuring the Protection of ERISA Plan Participants: ERISA Preemption and the Federal Government's Duty to Regulate Self-Insured Health Plans," 47 Buff. L. Rev. 1085, 1109 (1999) ("Schaeffer").
NEA retained ESI to help it locate stop-loss coverage and to act as a claims processor. ESI's president, Sacks, entered into negotiations with VBI. Sacks' primary point of contact at first was Kevin M. Hutchinson ("Hutchinson"), who was VBI's Regional Director of Marketing. Hutchinson transmitted an offer on March 12, 1996. The offer was cross-copied to VBI's corporate underwriters. Sacks responded in a letter dated May 1, 1996. VBI then extended a proposal on May 15, 1996. NEA ultimately purchased a policy from VBI covering the period between July 1, 1996 through June 30, 1997. VBI agreed, inter alia, to reimburse NEA for benefits paid in excess of a self-insured retention (which the policy refers to as the "minimum aggregate retention" or the "minimum annual aggregate attachment point") of $11,161,000. NEA paid a premium of approximately $1.6 million for the Anchorage policy.
Docket 36, exh. 25.
Id. at 2.
Docket 36, exh. 19.
Docket 33, exh. 2.
Docket 20, exh. 3 (Anchorage policy).
NEA also had a health plan for members of the Juneau Education Association. Its design differed from the Anchorage plan's design. VBI sent Sacks a proposal for a Juneau policy on August 14, 1996. NEA again purchased stop-loss coverage from VBI. On June 3, 1996, Dan Markovich, one of VBI's corporate underwriters, sent Sacks a facsimile message during negotiations for the Anchorage policy. Markovich observed, "Additional notes: Juneau and any subsequent school districts requesting coverage would be written as separate entities because of their initial effective dates."
Docket 36, exh. 19 at 2.
Docket 33, exh. 3.
Docket 20, exh. 4 at 1.
Hutchinson worked directly with Sacks in 1996 "to put together a proposal to [NEA] for a total cost stop loss insurance policy which would insure [NEA] in its capacity as administrator of a health plan for members of the Anchorage Education Association." Hutchinson states that he spoke with Markovich during the negotiation process for the Anchorage policy. According to Hutchinson, "we had spoken about the possibility that [VBI] might underwrite another [stop loss insurance policy] for [NEA] . . . for the benefit of members of the Juneau Education Association." Hutchinson advises that he and Markovich had the expectation "that such coverage would be provided through a separate insurance policy." Hutchinson declares that after the Anchorage policy was issued, he had additional "discussions and correspondence" with Sacks addressing a stop-loss insurance policy for the Juneau plan. Hutchinson states:
Affidavit of Kevin M. Hutchinson, January 29, 1999, ¶ 3 at 2 (submitted with ESI's motion for summary judgment at docket 20) (hereafter "Hutchinson Affidavit").
Hutchinson Affidavit, ¶ 5 at 2-3.
Id.
Id.
Hutchinson Affidavit, ¶ 7 at 3.
At no time in my dealings with Mr. Sacks or with the Trust [NEA] did I ever intend that the Anchorage Policy and the Juneau Policy would be treated as a single policy with a consolidated attachment point equal to the sum of the attachment points specified in each of the two policies. It was always my expectation, and it was my intent, that those coverages would be treated as entirely separate insurance policies." Sacks submits an affidavit in which he confirms Hutchinson's observations. Sacks states:
Hutchinson Affidavit, ¶ 11 at 5.
Affidavit of Robert Sacks, June 28, 1999 (filed at docket 26) (hereafter "Sacks Affidavit").
During the summer of 1996, I had discussions with representatives of VBI regarding the possible issuance to the Trust of another similar insurance policy for the health plan administered by the Trust for the benefit of members of the Juneau Education Association ("the Juneau Plan"). My expectation and intent that such coverage would be provided through a separate insurance policy is confirmed by a note appearing at the end of Mr. Markovich's telefax.
Sacks Affidavit, ¶ 6 at 3.
Sacks Affidavit, ¶ 6 at 3.
Neither Mr. Hutchinson nor anyone else at VBI ever made any representation to me, or implied to me, that the policies were to be a single policy, or that the insurers' liability under one policy would be affected in any way by losses under the other policy, if any.
Sacks Affidavit, ¶ 9 at 4.
Of course, Sacks' post litigation description of his intent when the contract was being negotiated is not competent to establish that intention, because of his status as a party to the litigation. However, his statement does identify a contemporaneous communication by one of the parties' agents, and his statement also corroborates what nonparty Hutchinson now has to say about the parties' intent during the negotiations.
See, e.g., Peterson v. Wirum, 625 P.2d 866, 870 (Alaska 1981); Day v. A. G. const. Co., Inc., 528 P.2d 440, 444 (Alaska 1974).
NEA ultimately purchased a Juneau policy from VBI covering the period between September 1, 1996 and August 31, 1997. VBI agreed, inter alia, to reimburse NEA for benefits paid in excess of a self-insured retention of $1,468,320. NEA paid a premium of $130,000 for the Juneau policy. No claim was ever made under the Juneau policy.
Docket 20, exh. 6 (Juneau policy).
Vernon Marshall, NEA's Plan Administrator, submits an affidavit in which he points out that certain features of the two policies differed. He also recounts his recollection of what representatives of the other parties said or did not say:
The risks insured by each policy were different. The time periods covered by each policy were different. The self-insured retentions specified in each policy were different. At no time between the date the negotiations began to obtain the Anchorage Policy and the Juneau Policy and the dates those policies went into effect did any representative of the insurers or ESI ever represent or imply to me or the Trust [NEA] that the two insurance policies were to be construed as a single policy, or that the claims made under one policy would in any way impact the insurers' liability to the Trust under the other policy.
Affidavit of Vernon Marshall, June 23, 1999, ¶ 8 at 3-4 (submitted with ESI's motion for summary judgment at docket 20) (hereafter "Marshall Affidavit"). Marshall's affidavit also declares: "It was at all times the understanding and the intent of the Trust [NEA] that the Anchorage Policy and the Juneau Policy were entirely separate insurance policies, and that the insurers' liability under either policy would be determined by the provisions of that policy." However, given that Marshall is an agent of a party whose interest is advanced by his post litigation assertion of intent, the court does not consider this portion of his affidavit. See cases cited in footnote 21.
Benefits paid under the Anchorage plan exceeded the self-insured retention specified in the Anchorage policy by $541,200. NEA submitted a claim to VBI. VBI paid approximately $270,000 as a partial estimated reimbursement subject to an audit or reexamination of the claim. Upon further review, VBI concluded that its liability under the Anchorage policy was only approximately $40,000 instead of $541,200 as claimed by NEA. VBI therefore sought reimbursement of $230,000 from NEA. VBI's position now is that it has no liability under the Anchorage policy unless and until the amount of benefits paid by NEA under both the Anchorage plan and the Juneau plan exceeds the combined sum of the self-insured retentions specified in both the Anchorage and Juneau policies.
D. Procedural History
NEA filed suit in the Superior Court for the First Judicial District in Juneau, Alaska, on October 1, 1998. VBI timely removed to this court. VBI then filed its answer and third-party complaint naming ESI as a third-party defendant. VBI's third-party claim against ESI alleges that ESI "participated in the breach of contract by NEA Alaska, and by their actions encouraged and induced the breach." VBI alleges that ESI is "jointly and severally liable for contract damages as well as consequential and compensatory damages." Other facts are noted below.
Notice of Removal, filed October 29, 1998, docket 1.
Answer and Third-Party Complaint, filed November 9, 1998, docket 4.
Answer and Third-Party Complaint, filed November 9, 1998, docket 4, ¶ 7 at 7.
Id.
III. STANDARD OF REVIEW
Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment should be granted if there is no genuine dispute as to material facts and if the moving party is entitled to judgment as a matter of law. The moving party has the burden of showing that there is no genuine dispute as to material fact. The moving party need not present evidence; it need only point out the lack of any genuine dispute as to material fact. Once the moving party has met this burden, the nonmoving party must set forth evidence of specific facts showing the existence of a genuine issue for trial. All evidence presented by the nonmovant must be believed for purposes of summary judgment and all justifiable inferences must be drawn in favor of the nonmovant. However, the nonmoving party may not rest upon mere allegations or denials, but must show that there is sufficient evidence supporting the claimed factual dispute to require a fact-finder to resolve the parties' differing versions of the truth at trial.
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
Id. at 323-325.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-9 (1986).
Id. at 255.
Id. at 248-9.
IV. DISCUSSION A. Whether the Contract was an Insurance Contract
VBI contends that the contracts at issue in this case are not insurance contracts. VBI argues that the court should apply principles of ordinary contract interpretation as opposed to principles of insurance contract interpretation. The applications which were submitted were identified as "APPLICATION[S] FOR EXCESS (STOP LOSS) COVERAGE." The contracts in question are titled "Aggregate/Specific Excess Insurance Schedule." They identify the retention by the "insured" (NEA). The contracts provide for payment of "premiums." The policies set forth limitations of coverage. The contracts cover notice of claims, payment of claims, and subrogation rights. The contracts contemplate that optional benefits, including "dental," "vision," and "disability weekly income" may be added. The contracts provide the purchaser with the seller's obligation to pay for the consequences of enumerated risks should those risks occur. In short, the contracts are insurance policies in form, scope, substantive content, and function.In opposition to the obvious, VBI cites five cases for the proposition that a stop-loss contract is not an insurance policy. But, as ESI and NEA persuasively argue, the cases do not stand for the broad proposition advanced by VBI. The cases hold either that an employer is not an insurer or that stop-loss insurance is not health insurance for purposes of ERISA-related concerns. The cases do not hold that stop-loss insurance is not a form of insurance. Accordingly, the stop-loss contracts will be interpreted according to the rules which apply to insurance contracts. However, even if the court applied normal contract interpretation principles, it is unlikely that the result would differ under the circumstances of this case. Normal principles of contract interpretation require that ambiguities in a contract be construed against the drafter. VBI drafted the contracts.
See NEA's Combined Opposition and Reply, docket 44 at 16-28; ESI's Reply and Opposition, docket 45 at 7-9.
B. Analyzing the Policies as Insurance Contracts 1. Alaska Principles of Insurance Contract Interpretation
Under Alaska law, insurance contracts are adhesion contracts. Insurance policies are therefore interpreted according to the principle of "reasonable expectations." The court will construe the policy's terms in light of the coverage that a lay person would reasonably expect given a lay person's interpretation of the policy. In ascertaining the insured's reasonable expectations, the court examines the policy in dispute, relevant extrinsic evidence, and case law addressing similar terms. Ambiguities are construed against the insurer and in favor of the insured. Terms are ambiguous if they are susceptible to more than one reasonable interpretation. Consistent with the preceding, coverage provisions are interpreted broadly and exclusions are narrowly construed.
Stordahl v. Government Employees Ins. Co., 564 P.2d 63, 66 (Alaska 1977).
Bering Straits School Dist. v. RLI Ins. Co., 873 P.2d 1292, 1294 (Alaska 1994).
State Farm Fire and Cas. Co. v. Bongen, 925 P.2d 1042, 1047 (Alaska 1996); Serradell v. Hartford Accident Indem. Co., 843 P.2d 639, 641 (Alaska 1992).
Bongen, 925 P.2d at 1047; Bering Straits, 873 P.2d at 1295.
Bering Straits, 873 P.2d at 1295.
Bering Straits, 873 P.2d at 1295; Serradell, 843 P.2d at 641.
Whispering Creek Condominium Owner Ass'n v. Alaska National Ins. Co., 774 P.2d 176, 178 (Alaska 1989); Starry v. Horace Mann Ins. Co., 649 P.2d 937, 939 (Alaska 1982).
2. Facts and Analysis
Hutchinson's affidavit, together with Markovich's June 3, 1996 facsimile note and the policies in question, establish that the parties did not intend to pool coverage, but that instead they intended to treat each policy separately. Sacks' and Marshall's affidavits establish that VBI did not convey any explanation that it intended the separate policies to pool coverage. Nothing in the policies suggests that coverage would be pooled. VBI drafted the policies. The Anchorage policy and the Juneau policy are separate policies. A different premium was charged for each policy. The two policies cover different risks. The policies covered different time periods. The self-insured retention limits specified in each policy are different. Neither policy refers to the other. The August 14, 1996 proposal addressing the Juneau plan does not refer to the Anchorage policy.VBI contends that the only reasonable interpretation of the Anchorage and Juneau contracts is that the attachment points for the Anchorage and Juneau plans were to be aggregated for purposes of the aggregate claim in part because there is only one contract number-150962-96-with "one single insured entity," NEA. However, given the facts, the insurance vendor's assignment of a single number to identify a particular purchaser of its products is not inconsistent with the existence of separate contracts. There are indisputably two documents. They contain distinctly different provisions. That the vendor assigned a single number to a particular purchaser of its insurance products in such circumstances is simply not probative one way or the other on the pooling issue.
See VBI's Motion, docket 36 at 28.
VBI also argues that "there is no language in the contract that states the aggregate attachment points for Anchorage and Juneau were to be considered separately." By like token, the policies do not provide that the attachment points are to be "pooled" or aggregated. VBI drafted all of the documents. VBI could have eliminated any uncertainty with better drafting, but did not.
Id.
VBI has declared that it did not intend to have separate attachment points. However, VBI's declaration of intent expressed during the midst of ongoing litigation is not probative of the parties' intent at the time of contract formation.
See, e.g., Peterson v. Wirum, 625 P.2d 866, 870 (Alaska 1981); Day v. A G Const. Co., Inc., 528 P.2d 440, 444 (Alaska 1974).
VBI points to a letter Sacks sent to Hutchinson dated May 1, 1996. In this letter, Sacks writes, "We also agreed on a 12/15 specific at $100,000 and 12/15 aggregate contract that, together with fixed costs, spec and agg premiums and aggregate factors, would run 5% less than the renewal numbers." VBI contends that this establishes that Sacks knew that coverage would be combined and intended to "pool the aggregate attachment points for purposes of an aggregate claim." However, this particular argument fails on several counts. First, read as a whole the contents of the May 1, 1996 letter do not support the argument VBI makes: The letter clearly speaks of Anchorage separately from Juneau. It refers to the demographic features of plan participants in Anchorage as being somewhat unusual. It refers to the particular arrangements being negotiated with Anchorage area health care providers. It explicitly points out that any plan for Juneau or Kodiak would be of a design different from the Anchorage design. The letter nowhere refers to a single or pooled attachment point. Second, this letter was authored in May 1, 1996, before negotiations for the Juneau policy even commenced. Third, the May 1, 1996 letter preceded subsequent communications which evidence a contrary intent as to the parties' reasonable expectations. Specifically, as discussed before, Dan Markovich, one of VBI's corporate underwriters, sent Sacks a facsimile message on or about June 3, 1996, during negotiations for the Anchorage policy. Markovich observed, "Additional notes: Juneau and any subsequent school districts requesting coverage would be written as separate entities because of their initial effective dates." Hutchinson's affidavit previously reviewed in detail establishes that Hutchinson and Markovich considered the Anchorage policy as a separate insurance contract from any other policy that might later be purchased. Under all of these circumstances, VBI's reliance on the quoted language is unavailing.
Docket 36, exh. 19.
Docket 36, exh. 19 at 1.
See VBI's motion, docket 36 at 29.
Docket 20, exh. 4 at 1.
However, there is one paragraph in the May 1, 1996 letter that-at first impression-seems to support VBI's position. Sacks wrote:
This plan design will differ from the designs in Juneau and Kodiak Island. However, the experience will be aggregated for purposes of the stop-loss attachment points. Each school district will have its own agg factors made up of the remainder left after subtracting the $22 fixed costs, commissions, premiums from 95% of the renewal (or current if not renewing at a particular time). Eventually, we want all plan experience rolled into one plan year (July 1 through June 30). However, the first year will be a rolling enrollment as each school district bargaining unit is able to leave the school district plan.
Docket 36, exh. 19 at 2 (emphasis added).
Sacks was asked about this paragraph at his deposition. Sacks explained that, in concept, what he was trying to convey was that coverage might potentially be aggregated at some future date, perhaps even for the following year, but that for the 1996-97 year covering the policy in question, this would not be done. The following questions and answers clarify Sacks' letter:
See Deposition of Robert Sacks, July 15, 1999, at 48-50 (submitted as unmarked exhibit at docket 36) (hereafter "Sacks Dep. at ___").
QUESTION: [quoting from letter] "However, the experience will be aggregated for purposes of the stop/loss attachment points." What did you mean by that, what was your conceptual idea there?
ANSWER (By Mr. Sacks): Well, conceptually, and this all had to do with the renewals, it had nothing to do with the first year because we didn't have any experience on any of these groups, so each of the groups, and this was discussed, had to stand on their own merit, and that was something that was confirmed, in fact, by Dan Markovich, that each school district in effect had to stand on its own merit as far as pricing it the first year, as far as, you know, whatever their re-whatever their renewal cost would be or whatever their renewal premium would be from the current carrier that we were replacing. Our five percent was based on that. So each one-what was intended was that the underwriter would look at the experience of each group, and then after one year in our plan they would look at the different experiences and they would be able to then come up with a composite or aggregated rate of all the experience and census, and maybe try to even blend now the benefit designs. That was the concept to move people in with varying different plans and varying different plan years, for that matter. So that was the concept.
QUESTION: So your phrase: "The experience will be aggregated for purposes of the stop/loss attachment points" was not intended to refer to the 96-97 —
ANSWER: That is correct.
QUESTION: -year but to the potential 97-98 year?
ANSWER: Potential 97-98 year, correct.
Sacks Dep. at 49-50. Quotation marks have been added to the cited questions for clarity's sake.
This is consistent with Markovich's June 3, 1996 facsimile message in which, as discussed, Markovich stated, "Additional notes: Juneau and any subsequent school districts requesting coverage would be written as separate entities because of their initial effective dates." Sacks testified that the major concern was "what will happen at renewal" because different plans would be coming into effect at different times. Sacks noted:
Docket 20, exh. 4 at 1.
Sacks Dep. at 55.
What we were concerned about was the renewal and how would we bring these plans together, if we were going to be able to bring them together. Eventually they could have stayed on their own, you know, as well. They might have just existed as separate plans and with separate different — even separate reinsurers, like we did with Mat-Su.
Id.
This concern about renewal reflects, as Sacks testified, that the parties "weren't aggregating any experience of these plans, they were all standing on their own merit."
Id.
VBI also relies heavily on an in-house e-mail Markovich sent to Arlene Cayetano, another VBI employee, on or about June 28, 1996. VBI relies on a portion of the e-mail wherein Markovich relates to Cayetano that he told Sacks:
Docket 36, exh. 5.
I went on to explain that even though we may have different Effective Dates on the school districts involved, we would have to [sic] the same ends date (7/1) for the aggregate considering the districts are being `pooled' he asked why we could not keep them separate in the first year, and I explained that when we calculated our numbers, we assumed pooling of the aggregate, which allowed us to be more aggressive with our factors.
Id.
However, this cannot be taken out of context. In the preceding paragraph Markovich explains that after getting refreshed by Bob Mallison, Markovich explained to Sacks that all the districts could be put on the same effective date by July 1, 1999, which is consistent with Sacks' deposition testimony to the effect that pooling might be achieved at some time after the initial year. It also bears mentioning that the e-mail explicitly states that its subject is "Mat-Su." That is a reference to the Matanuska-Susitna School District, not the Juneau School District. Even if the substance of the e-mail could be read to show that Markovich was expressing the view that Anchorage and Juneau would be pooled (which it cannot), the e-mail does not say that Sacks agreed to such an arrangement. It may be added that the e-mail is not authenticated, and Markovich had no independent recollection of this conversation with Sacks when he was asked about the e-mail at his deposition. Finally, the June 28, 1996 e-mail is at best a post hoc expression of opinion: Hutchinson transmitted an offer on March 12, 1996; the offer was cross-copied to Markovich; the offer does not refer to any pooled coverage; Sacks responded in his letter dated May 1, 1996; VBI then extended a proposal on May 15, 1996; NEA submitted its application on June 16, 1996. In short, the e-mail cannot pull the load VBI would attach to it.
See Deposition of Daniel P. Markovich, July 13, 1999, at 118 (submitted as unmarked exhibit at docket 44) (hereafter "Markovich Dep. at ___."); see also id at 61-63.
Docket 36, exh. 25.
Docket 36, exh. 25 at 2.
Docket 36, exh. 19.
Docket 33, exh. 2.
VBI concedes that initial negotiations were conducted between Hutchinson and Sacks. Hutchinson submitted a proposal to Sacks on or about March 12, 1996. VBI contends that Hutchinson did not have authority to make an offer that would bind VBI. Instead, according to VBI, Hutchinson only had authority to solicit business from ESI. However, it is undisputed that Sacks thought that Hutchinson had authority to make a firm offer. It is undisputed that Hutchinson was VBI's Regional Director of Marketing when the Anchorage and Juneau policies were negotiated and purchased. As already noted, Markovich's June 3, 1996 facsimile message to Sacks included the notation, "Additional notes: Juneau and any subsequent school districts requesting coverage would be written as separate entities because of their initial effective dates." Hutchinson's affidavit previously reviewed in detail establishes that Hutchinson and Markovich considered the Anchorage policy as a separate insurance contract from any other policy that might later be purchased. There is no evidence that VBI ever took any steps to advise ESI, Sacks, NEA, or anyone else that Hutchinson did not have authority to make a firm offer before the policy took effect. Nothing in the policies suggests that coverage would be pooled. VBI drafted the policies. The Anchorage policy and the Juneau policy are separate policies. A different premium was charged for each policy. The two policies cover different risks. The policies covered different time periods. The self-insured retention limits specified in each policy are different. Neither policy refers to the other. The August 14, 1996 proposal addressing the Juneau plan does not refer to the Anchorage policy.
See VBI's Motion, docket 36 at 7.
Docket 36, exh. 25.
See VBI's Motion, docket 36 at 8.
Id.
Id. (citing Bob Sacks deposition, p. 40, line 24 to p. 41 line 5) (submitted as exhibit at docket 36).
Docket 20, exh. 4 at 1.
Docket 33, exh. 3.
In summary, there is no genuine issue of material fact in dispute. The parties neither intended to pool coverage of the Anchorage and Juneau policies nor to treat the two policies as a single policy. The parties intended to treat each policy as a separate policy and to determine the insurer's liability under each policy by the terms of the specific policy in question. NEA is entitled to summary judgment as a matter of law.
C. VBI's Claims Against NEA, ESI, and Sacks
VBI's counterclaim against NEA alleges breach of contract. VBI's third-party claim against ESI alleges that ESI "participated in the breach of contract by NEA Alaska, and by their actions encouraged and induced the breach." VBI alleges that ESI is "jointly and severally liable for contract damages as well as consequential and compensatory damages." Because this court has held that NEA did not breach the insurance contract and is entitled to summary judgment as a matter of law, it necessarily follows that VBI's counterclaims against NEA must be dismissed along with VBI's third-party claims against ESI and Sacks.
Answer and Third-Party Complaint, filed November 9, 1998, docket 4, ¶¶ 2-6 at 6-7.
Answer and Third-Party Complaint, filed November 9, 1998, docket 4, ¶ 7 at 7.
Id.
V. CONCLUSION
The parties raise multiple other arguments which it is not necessary to address. For the foregoing reasons, ESI's motion for summary judgment at docket 20 is GRANTED, NEA's motion for summary judgment at docket 33 is GRANTED, and VBI's cross-motion for summary judgment at docket 36 is DENIED.