Case Title: Yahoo Inc. v. National Union Fire Insurance Co. of Pittsburgh, PA

Citation: 

Docket Number: S253593

State: california

Court: California Supreme Court

Date: 2022-11-17T00:00:00Z

Document:
IN THE SUPREME COURT OF 
CALIFORNIA 
 
YAHOO INC., 
Plaintiff and Appellant, 
v. 
NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA, 
Defendant and Respondent. 
 
S253593 
 
Ninth Circuit 17-16452 
 
Northern District of California 
No. 5:17-cv-00447-NC 
 
 
November 17, 2022 
 
Justice Jenkins authored the opinion of the Court, in which 
Chief Justice Cantil-Sakauye and Justices Corrigan, Liu, 
Kruger, Groban, and Guerrero concurred. 
 
1 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE 
COMPANY OF PITTSBURGH, PA 
S253593 
 
Opinion of the Court by Jenkins, J. 
 
The law of privacy recognizes, among other things, a right 
to secrecy and a right to seclusion.  “[A] person claiming the 
privacy right of seclusion asserts the right to be free, in a 
particular location, from disturbance by others.  A person 
claiming the privacy right of secrecy asserts the right to prevent 
disclosure of personal information to others.  Invasion of the 
privacy right of seclusion involves the means, manner, and 
method of communication in a location (or at a time) which 
disturbs the recipient’s seclusion.  By contrast, invasion of the 
privacy right of secrecy involves the content of communication 
that occurs when someone’s private, personal information is 
disclosed to a third person.”  (ACS Systems, Inc. v. St. Paul Fire 
& Marine Ins. Co. (2007) 147 Cal.App.4th 137, 148–149 (ACS 
Systems).)1 
Privacy injuries that involve the right of seclusion are 
sometimes actionable under the federal Telephone Consumer 
Protection Act of 1991 (TCPA) (47 U.S.C. § 227 (section 227)), 
provided the violation involves the use of telephonic equipment.  
 
1  
Our case law also recognizes two other types of privacy 
violations.  Stated in general terms, these are:  (1) “publicity 
placing a person in a false light,” and (2) “misappropriation of a 
person’s name or likeness.”  (Hill v. National Collegiate Athletic 
Assn. (1994) 7 Cal.4th 1, 24; see Fellows v. National Enquirer, 
Inc. (1986) 42 Cal.3d 234, 238.) 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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2 
Specifically, the TCPA protects the seclusion interests of 
telephone users by placing restrictions on automated telephone 
calls 
(“robocalls”) 
and 
unsolicited 
facsimile 
machine 
advertisements (“junk faxes”).  (See § 227; Duguid v. Facebook, 
Inc. (9th Cir. 2019) 926 F.3d 1146, 1149.)  Subject to certain 
exceptions, the TCPA prohibits making “any call . . . using any 
automatic telephone dialing system . . . to any telephone 
number 
assigned 
to 
a . . . 
cellular 
telephone 
service.”  
(§ 227(b)(1)(A)(iii).)  The TCPA also prohibits, again subject to 
exceptions, using “any . . . device to send, to a telephone 
facsimile machine, an unsolicited advertisement.”  (Id., 
§ 227(b)(1)(C).)  Significantly, the TCPA’s prohibitions have 
been interpreted to apply to text messages (“robotexts”), not just 
to voice telephone calls.  (Duguid, supra, 926 F.3d at p. 1149; 
Satterfield v. Simon & Schuster, Inc. (9th Cir. 2009) 569 F.3d 
946, 954.) 
Many commercial general liability (CGL) insurance 
policies provide coverage against liability for privacy violations, 
but it is not always clear what specific types of privacy violations 
are covered.  The insurance policy at issue here, for example, 
provides liability coverage for injuries “arising out of . . . [o]ral 
or written publication, in any manner, of material that violates 
a person’s right of privacy.”  The question we must resolve is 
whether this language provides liability coverage for right-of-
seclusion violations litigated under the TCPA.  We conclude that 
it does, assuming such coverage is consistent with the insured’s 
reasonable expectations. 
I.  FACTS AND PROCEDURAL BACKGROUND 
When defendant National Union Fire Insurance Company 
of Pittsburgh, PA (National Union) declined to defend or 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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Opinion of the Court by Jenkins, J. 
 
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indemnify plaintiff Yahoo Inc. (Yahoo!) in a series of putative 
class action lawsuits alleging that Yahoo!’s unsolicited text 
messaging had violated the TCPA, Yahoo! sued National Union 
in federal district court, alleging breach of contract and seeking 
to obtain coverage.  According to the complaint, National Union 
sold Yahoo! a CGL policy covering the period when the alleged 
TCPA violations occurred.2  The policy was in the form of 
National Union’s standard CGL policy, modified by various 
endorsements including a negotiated endorsement called 
endorsement No. 1 (Endorsement No. 1).   
The standard version of National Union’s policy provided 
liability coverage for “personal and advertising injury,” which 
the policy defined as injury arising out of any of seven specified 
offenses, including “[o]ral or written publication, in any manner, 
of material that violates a person’s right of privacy.”  The 
standard policy, however, excluded injuries arising from the 
distribution of material in violation of the TCPA. 
Endorsement No. 1 modified National Union’s standard 
policy in three important ways.  First, Endorsement No. 1 
 
2  
National Union actually sold Yahoo! four consecutive 
policies, covering the period from May 31, 2008, to May 31, 2012, 
each containing the same relevant terms.  For the sake of 
simplicity, we refer to these four policies collectively as if they 
were a single policy.  The complaint also alleges coverage under 
a fifth consecutive policy, but Yahoo! concedes that this was 
error because the fifth policy was materially different from the 
others.  Yahoo! states that it plans to amend its complaint to 
correct this error. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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removed the exclusion for injuries arising from violations of the 
TCPA.3 
Second, Endorsement No. 1 provided liability coverage 
only for “personal injury” (as compared to “personal and 
advertising injury” in the standard version of the policy), and it 
defined “personal injury” to include injury arising from any of 
five offenses (as compared to seven offenses in the standard 
version of the policy).  The list of five offenses, however, still 
included injuries arising from “[o]ral or written publication, in 
any manner, of material that violates a person’s right of 
privacy.”4  Therefore, although Endorsement No. 1 removed 
 
3  
A separate endorsement — the “Statute Endorsement” — 
added an exclusion for liability arising from “any act that 
violates 
any 
statute . . . 
of 
any 
federal 
[or] 
state . . . 
government, . . . that . . . addresses or applies to the sending, 
transmitting or communicating of any material or information, 
by any means whatsoever.”  (Italics added.)  The existence of the 
Statute Endorsement caused the Ninth Circuit to consider 
whether the removal of the more specific exclusion for TCPA 
liability had been without substantive effect.  The Ninth Circuit 
asked for supplemental briefing on the question, and Yahoo! 
argued that Endorsement No. 1 superseded the Statute 
Endorsement.  We express no view on the question. 
4  
The five personal injury offenses are:  “a. False arrest, 
detention, or imprisonment; [¶] b. Malicious prosecution; [¶] c. 
The wrongful eviction from, wrongful entry into, or invasion of 
the right of private occupancy of a room, dwelling or premises 
that a person occupies, committed by or on behalf of its owner, 
landlord or lessor; [¶] d. Oral 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 [¶] e. Oral or written publication, in any 
manner, of material that violates a person’s right of privacy.” 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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coverage for advertising injuries, coverage for injuries to privacy 
remained. 
Third, and related to the second change, Endorsement 
No. 1 expressly excluded liability coverage for “advertising 
injury,” which it defined as injury arising from any of four 
offenses, including “[o]ral or written publication, in any manner, 
of material in your ‘advertisement’ that violates a person’s right 
of privacy.”5  (Italics added.)  Therefore, although Endorsement 
No. 1’s coverage provision created liability coverage for privacy 
injuries, the same endorsement expressly carved out liability 
coverage for privacy injuries caused by material in a Yahoo! 
advertisement. 
Yahoo! argues that its policy — as modified by 
Endorsement No. 1 — gave rise, at the very least, to the 
potential for coverage of the TCPA claims alleged against it in 
the underlying putative class action lawsuits, and therefore 
National Union was obligated to defend Yahoo! in those suits, 
and it breached its contract by declining to do so.  (See Gray v. 
Zurich Ins. Co. (1966) 65 Cal.2d 263, 276–277.)  The federal 
district court rejected that argument.  It granted National 
Union’s motion to dismiss, concluding that the TCPA lawsuits 
do not fall within the policy’s coverage provision because they do 
 
5  
The four advertising injury offenses are:  “a. Oral or 
written publication, in any manner, of material in your 
‘advertisement’ that slanders or libels a person or organization 
or disparages a person’s or organization’s goods, products or 
services; [¶] b. Oral or written publication, in any manner, of 
material in your ‘advertisement’ that violates a person’s right of 
privacy; [¶] c. The use of another’s advertising idea in your 
‘advertisement’; or [¶] d. Infringing upon another’s copyright, 
trade dress or slogan in your ‘advertisement.’ ” 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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not allege an injury arising out of the “publication . . . of 
material that violates a person’s right of privacy.”  (Italics 
added.)  Focusing on the italicized language quoted above, the 
district court concluded that this language covers liability for 
right-of-secrecy violations but that it does not cover right-of-
seclusion violations, including right-of-seclusion violations 
litigated under the TCPA.  In reaching this conclusion, the 
district court applied the rule of the last antecedent, a rule of 
construction under which a restrictive clause modifies only the 
word or phrase that immediately precedes it.  Applying that 
rule, the court read the clause “that violates a person’s right of 
privacy” as modifying only the word “material,” meaning that 
for the policy to provide liability coverage, the alleged privacy 
violation must relate to the content of the published material.  
Finding that the TCPA claims asserted against Yahoo! focused 
on the transmission of unsolicited text messages rather than the 
content of those messages, the federal district court dismissed 
Yahoo!’s insurance coverage action, entering judgment for 
National Union. 
Yahoo! appealed, and the United States Court of Appeals 
for the Ninth Circuit certified a question of state law to this 
court.  We granted the Ninth Circuit’s request and rephrased its 
question (see Cal. Rules of Court, rule 8.548(f)(5)).  As 
rephrased, we are called upon to answer the following question:  
“Does a commercial general liability insurance policy that 
provides coverage for ‘personal injury,’ defined as ‘injury . . . 
arising out of . . . [o]ral or written publication, in any manner, of 
material that violates a person’s right of privacy,’ and that has 
been modified by endorsement with regard to advertising 
injuries, trigger the insurer’s duty to defend the insured against 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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a claim that the insured violated the [TCPA] of 1991 (47 U.S.C. 
§ 227) by sending unsolicited text message advertisements that 
did not reveal any private information?”6 
II.  DISCUSSION 
The parties agree that the TCPA creates a statutory cause 
of action to redress telephonic intrusions that can, depending on 
the factual circumstances, violate the common law right of 
seclusion, and the parties also agree that the TCPA is not 
concerned with disclosures that violate the common law right of 
secrecy.  (See Los Angeles Lakers, Inc. v. Federal Ins. Co. (9th 
Cir. 2017) 869 F.3d 795, 806 [“ ‘[c]ourts have consistently held 
the TCPA protects a species of privacy interest in the sense of 
seclusion’ ”]; Auto-Owners Ins. Co. v. Websolv Computing, Inc. 
(7th Cir. 2009) 580 F.3d 543, 549 [“The underlying [TCPA] suit 
here only involves seclusion interests”]; Resource Bankshares 
Corp. v. St. Paul Mercury Ins. Co. (4th Cir. 2005) 407 F.3d 631, 
642 [“the TCPA’s unsolicited fax prohibition protects ‘seclusion’ 
privacy, for which content is irrelevant”]; American States Ins. 
Co. v. Capital Associates of Jackson County (7th Cir. 2004) 392 
F.3d 939, 943 [the TCPA “condemns a particular means of 
communicating an advertisement, rather than the contents of 
that advertisement”].)  Therefore, if the policy at issue here does 
not cover liability for violations of the right of seclusion, then it 
 
6  
The phrase “by sending unsolicited text message 
advertisements” appears both in the Ninth Circuit’s original 
certified question and in our rephrasing of the question.  
Nonetheless, our statement of the certified question should not 
be interpreted to express this court’s opinion as to whether the 
text messages at issue in the underlying TCPA lawsuits were, 
in fact, advertisements as defined in the policy. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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does not cover Yahoo!’s potential TCPA liability in the 
underlying lawsuits. 
Whether Yahoo!’s policy covers liability for violations of 
the right of seclusion, like all questions concerning the scope of 
insurance coverage, is subject to de novo review.  (Waller v. 
Truck Ins. Exchange (1995) 11 Cal.4th 1, 18.)  The relevant 
principles are well settled.  In Palmer v. Truck Ins. Exchange, 
we said:  “ ‘While insurance contracts have special features, they 
are still contracts to which the ordinary rules of contractual 
interpretation apply.’  [Citation.]  Thus, ‘the mutual intention of 
the parties at the time the contract is formed governs 
interpretation.’  [Citation.]  If possible, we infer this intent solely 
from the written provisions of the insurance policy.  [Citation.]  
If the policy language ‘is clear and explicit, it governs.’ ”  (Palmer 
v. Truck Ins. Exchange (1999) 21 Cal.4th 1109, 1115 (Palmer).)  
Similarly, in Boghos v. Certain Underwriters at Lloyd’s of 
London, we said:  “Our goal in construing insurance contracts, 
as with contracts generally, is to give effect to the parties’ 
mutual intentions.  [Citations.]  ‘If contractual language is clear 
and explicit, it governs.’  [Citations.]  If the terms are ambiguous 
[i.e., susceptible of more than one reasonable interpretation], we 
interpret them to protect ‘ “the objectively reasonable 
expectations of the insured.” ’  [Citations.]  Only if these rules do 
not resolve a claimed ambiguity do we resort to the rule that 
ambiguities are to be resolved against the insurer.”  (Boghos v. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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Certain Underwriters at Lloyd’s of London (2005) 36 Cal.4th 
495, 501.)7 
When coverage is in dispute, the initial burden is on the 
insured — Yahoo! in this case — to prove that its claim falls 
within the scope of potential coverage.  (See Waller v. Truck Ins. 
Exchange, supra, 11 Cal.4th at p. 16.)  If the insured establishes 
that the policy provides at least the potential for coverage, the 
burden shifts to the insurer — National Union in this case — to 
show the claim falls within one of the policy’s exclusions.  (See 
ibid.; see also Liberty Surplus Ins. Corp. v. Ledesma & Meyer 
Construction Co., Inc. (2018) 5 Cal.5th 216, 222 [“ ‘ “[T]he 
insured must prove the existence of a potential for coverage, 
while the insurer must establish the absence of any such 
potential.  In other words, the insured need only show that the 
 
7  
We have, in the past, formulated this inquiry slightly 
differently.  (See, e.g., State of California v. Continental Ins. Co. 
(2012) 55 Cal.4th 186, 195 [“ ‘If an asserted ambiguity is not 
eliminated by the language and context of the policy, courts then 
invoke the principle that ambiguities are generally construed 
against the party who caused the uncertainty to exist (i.e., the 
insurer) in order to protect the insured’s reasonable expectation 
of coverage.’ ”], quoting La Jolla Beach & Tennis Club, Inc. v. 
Industrial Indemnity Co. (1994) 9 Cal.4th 27, 37); Producers 
Dairy Delivery Co. v. Sentry Ins. Co. (1986) 41 Cal.3d 903, 912 
[“It is a basic principle of insurance contract interpretation that 
doubts, uncertainties and ambiguities arising out of policy 
language ordinarily should be resolved in favor of the insured in 
order to protect his reasonable expectation of coverage.”].)  To 
the extent these prior formulations are inconsistent with our 
description of the inquiry here, our formulation in this opinion 
controls. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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underlying claim may fall within policy coverage; the insurer 
must prove it cannot” ’ ”].)8 
A. The Coverage Provision of Yahoo!’s Policy 
The policy at issue here provides liability coverage for 
injuries “arising out of . . . [o]ral or written publication, in any 
manner, of material that violates a person’s right of privacy.”  
We take the word “material” in this context to refer to 
“[i]nformation, ideas, data, documents, or other things that are 
used in reports, books, films, studies, etc.”  (Black’s Law Dict. 
(10th ed. 2014) p. 1124, col. 2.)  The clause “that violates a 
person’s right of privacy” is a restrictive relative clause with the 
word “that” as its relative pronoun.  According to the rules 
governing word order in the English language, a restrictive 
relative clause usually modifies the noun that immediately 
precedes it, which in this case is the word “material.”  In fact, if 
a restrictive relative clause is located in a place that is remote 
from the noun it modifies, it is usually described as a misplaced 
modifier.  Hence, Strunk and White advise that a “relative 
pronoun should come, in most instances, immediately after its 
antecedent.”  (Strunk and White, The Elements of Style (4th ed. 
2000) p. 29; see id. at pp. 28–31.)  Sometimes, however, the 
antecedent of a relative pronoun consists of a group of words.  In 
that case, “the relative [pronoun] comes at the end of the group, 
unless this would cause ambiguity.”  (Id. at p. 30.) 
Here, it is unclear whether the restrictive clause “that 
violates a person’s right of privacy” modifies a group of words or 
 
8  
The Ninth Circuit has only asked us to address the scope 
of the coverage provision of Yahoo!’s policy; therefore, we do not 
consider the exclusions. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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just a single word.  Specifically, it is ambiguous whether the 
clause modifies the entire phrase “[o]ral or written publication, 
in any manner, of material” or whether it modifies only the word 
“material.”  If the former, then the intrusive way the material is 
published, not just its informational content, might give rise to 
the privacy violation at issue, and the violation would, 
nonetheless, be covered by the policy.  Under this reading, even 
if the published material were something that was not in the 
least private (for example, weather forecasts or sports scores), 
its publication in a manner that violated a person’s right of 
seclusion would still amount to a covered privacy violation.  But 
if the clause “that violates a person’s right of privacy” modifies 
only the word “material,” then it follows that something about 
the material itself, viewed in isolation, must violate a person’s 
right of privacy, which in turn implies that it must do so by 
reason of its informational content.  Thus, the coverage 
provision is facially ambiguous, and the ambiguity is critical to 
resolution of the question of coverage in this case. 
In such situations, our first step is to consider whether the 
standard rules of contract interpretation can resolve the facial 
ambiguity in the policy’s language.  Then, if the application of 
those rules fails to resolve the ambiguity, we interpret the 
provision in favor of protecting the insured’s reasonable 
expectations.  “Only if these rules do not resolve a claimed 
ambiguity do we resort to the rule that ambiguities are to be 
resolved against the insurer.”  (Boghos v. Certain Underwriters 
at Lloyd’s of London, supra, 36 Cal.4th at p. 501; see Minkler v. 
Safeco Ins. Co. (2010) 49 Cal.4th 315, 321–322; Bank of the West 
v. Superior Court (1992) 2 Cal.4th 1254, 1264–1265.) 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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1. Application of the Standard Rules of Contract 
Interpretation 
“The mere fact that a word or phrase in a policy may have 
multiple meanings does not create an ambiguity.”  (Palmer, 
supra, 21 Cal.4th at p. 1118.)  Rather, the meaning of the word 
or phrase must be considered in light of its context.  (See State 
of California v. Continental Ins. Co., supra, 55 Cal.4th at p. 195; 
Minkler v. Safeco Ins. Co., supra, 49 Cal.4th at p. 322; Bank of 
the West v. Superior Court, supra, 2 Cal.4th at p. 1265.)  Several 
aspects of the policy at issue here suggest that in the policy’s 
coverage provision, the restrictive clause “that violates a 
person’s right of privacy” modifies only the word “material,” 
meaning that, for there to be coverage, the material itself — that 
is, its informational content — must give rise to the privacy 
violation. 
Courts will favor an interpretation that gives meaning to 
each word in a contract over an interpretation that makes part 
of the writing redundant.  (See Carson v. Mercury Ins. Co. (2012) 
210 Cal.App.4th 409, 420.)  Reading the restrictive clause “that 
violates a person’s right of privacy” as modifying the entire 
phrase “[o]ral or written publication, in any manner, of 
material,” and thus as creating liability coverage for right-of-
seclusion violations, might be seen as somewhat unnatural 
because it is a reading that arguably makes the word “material” 
superfluous.  In other words, if the policy were intended to cover 
liability for any publication that violated a person’s right of 
privacy, whether by disclosing a person’s secrets or intruding 
upon a person’s seclusion, or otherwise, then the word 
“material” could simply have been omitted from the coverage 
provision altogether.  But the coverage provision at issue here 
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includes the word “material.”  The addition of the word 
“material” immediately before the restrictive clause “that 
violates a person’s right of privacy” arguably suggests that 
something about the content of the material itself, viewed in 
isolation, must violate a person’s right of privacy.  Thus, since 
content is irrelevant to right-of-seclusion violations, the 
inclusion of the word “material” implies that the policy does not 
cover right-of-seclusion liability. 
This reading of the coverage language finds support in 
various other provisions of Yahoo!’s policy.  As modified by 
Endorsement No. 1, the policy provides liability coverage for 
“personal injury,” which it defines to include injury arising from 
any of five offenses.  One of those offenses is the one we have 
been discussing here (“[o]ral or written publication, in any 
manner, of material that violates a person’s right of privacy”), 
but another offense, one not at issue here, uses parallel phrasing 
(“[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”).  
Although the latter offense is not implicated here directly, it is 
nonetheless relevant.  Published material can slander, libel, or 
disparage a person only by reason of its informational content — 
it cannot do so in any other way.  Therefore, the parallel 
phrasing between these two offenses supports an inference that 
both offenses are concerned with the informational content of 
the published material.  (See E.M.M.I. Inc. v. Zurich American 
Ins. Co. (2004) 32 Cal.4th 465, 475 [“the same word used in an 
instrument is generally given the same meaning unless the 
policy indicates otherwise”].)  And that, in turn, suggests that 
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the liability coverage for privacy injuries does not extend to 
violations of the right of seclusion. 
In addition, the policy at issue here excludes “[o]ral or 
written publication, in any manner, of material in your 
‘advertisement’ that violates a person’s right of privacy.”  With 
respect to this advertisement injury exclusion, the content of the 
advertisement is clearly referenced by the word “material” 
because the provision uses the phrase “material in your 
‘advertisement.’ ”  (Italics added.)  Again, because this 
advertisement provision, like the slander provision discussed 
above, uses phrasing that parallels the provision we are 
interpreting in this case, a plausible argument can be made that 
the latter provision is likewise concerned with the content of 
what is being published.  (See E.M.M.I. Inc. v. Zurich American 
Ins. Co., supra, 32 Cal.4th at p. 475.) 
Yet other aspects of Yahoo!’s policy suggest that in the 
policy’s coverage provision, the restrictive clause “that violates 
a person’s right of privacy” modifies the entire phrase “[o]ral or 
written publication, in any manner, of material,” thus creating 
coverage for any publication-based right-of-privacy violation, 
including right-of-seclusion violations.  For example, even if the 
slander provision and the advertising injury exclusion refer only 
to content-based injuries, those provisions are worded 
differently from the provision now before us.  The specific 
provision at issue here (“[o]ral or written publication, in any 
manner, of material that violates a person’s right of privacy”) 
does not include language that similarly requires such a narrow 
interpretation. 
Moreover, it may be that the parties affirmatively 
intended to modify the policy to cover right-of-seclusion injuries 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
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litigated under the TCPA.  In its brief in this court, Yahoo! says:  
“In the National Union Policies, the ‘personal injury’ coverage 
was deliberately expanded by manuscript endorsement [(i.e., 
Endorsement No. 1)] to cover specialized risks beyond what was 
covered by the standard form language.  The endorsement 
removed certain exclusions, including the TCPA liability 
exclusion, and provided expanded coverage for conduct-based 
‘personal injury’ offenses, separate and distinct from content-
based ‘advertising injury’ offenses.”  (Italics added.)  Relying on 
this conduct-content distinction, Yahoo! argues that, in the 
context of the coverage provision, the restrictive clause “that 
violates a person’s right of privacy” should be interpreted 
broadly to include conduct that violates a person’s right of 
privacy (i.e., right-of-seclusion violations), whereas in the 
context of the advertising injury exclusion, the same restrictive 
clause should be limited to content that violates a person’s right 
of privacy (i.e., right-of-secrecy violations). 
The arguments favoring Yahoo!’s broad reading of the 
coverage provision at issue are far from conclusive.  However, 
Yahoo!’s arguments serve to persuade us that the policy remains 
ambiguous even when we apply the standard rules of contract 
interpretation in an effort to clarify the policy’s meaning.  The 
restrictive clause “that violates a person’s right of privacy” can 
reasonably be read to modify the entire phrase “[o]ral or written 
publication, in any manner, of material,” and the standard rules 
of contract interpretation do not foreclose that reading.9 
 
9  
Insurance companies can easily avoid the ambiguous 
language used here, by revising the language to clarify the scope 
of the coverage they are providing. 
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2. Insured’s Reasonable Expectations and Other 
Considerations 
Where, as here, the standard rules of contract 
interpretation do not resolve an ambiguity in the operative 
language of an insurance policy, “we interpret [that language] 
to protect ‘ “the objectively reasonable expectations of the 
insured.” ’ ”  (Boghos v. Certain Underwriters at Lloyd’s of 
London, supra, 36 Cal.4th at p. 501.)  As noted above, “[o]nly if 
these rules do not resolve a claimed ambiguity do we resort to 
the rule that ambiguities are to be resolved against the insurer.”  
(Ibid.; see Minkler v. Safeco Ins. Co., supra, 49 Cal.4th at p. 321; 
State of California v. Allstate Ins. Co. (2009) 45 Cal.4th 1008, 
1018.) 
Therefore, “a court that is faced with an argument for 
coverage based on assertedly ambiguous policy language must 
first attempt to determine whether coverage is consistent with 
the insured’s objectively reasonable expectations.”  (Bank of the 
West v. Superior Court, supra, 2 Cal.4th at p. 1265.)  Here, 
however, the question whether it was objectively reasonable for 
Yahoo! to expect coverage of its TCPA liability cannot be 
resolved without further litigation focusing on the scope of the 
Statute Endorsement, the scope of the advertising injury 
exclusion, the specific factual circumstances of the alleged TCPA 
violations (i.e., whether they amount to a right-of-seclusion 
violation under California law), and perhaps other unresolved 
issues not presented to this court.  In this context, it also merits 
noting that merely removing an exclusion for TCPA liability is 
not, by itself, enough to establish coverage of such liability.  (See 
Waller v. Truck Ins. Exchange, supra, 11 Cal.4th at p. 16.) 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
17 
As regards the next and final step — the rule that we 
interpret unresolvable ambiguities in favor of the insured — the 
application of that rule must take into consideration the specific 
circumstances in which the policy was drafted.  The rule derives 
from the principle of contra proferentem (“against the drafter”), 
and it is justified on the grounds that the drafter of a contract 
should bear the responsibility for ambiguities the drafter could 
have resolved.  (See Abraham, A Theory of Insurance Policy 
Interpretation (1996) 95 Mich. L.Rev. 531, 533.)  Therefore, the 
rule favoring the insured does not necessarily apply where the 
insured is one of the contract’s drafters. 
Here, sophisticated parties have bargained over the terms 
of a manuscript endorsement, and the ambiguous coverage 
provision appears in that manuscript endorsement.  In this 
situation, it is appropriate to ask whether the insurer can be 
considered the sole drafter of the provision and therefore 
whether the insurer is solely responsible for the ambiguity in 
that provision.  But even in the case of a manuscript 
endorsement, ambiguities should be resolved in favor of 
coverage when the specific ambiguous language is “adopted 
verbatim from standard form policies used throughout the 
country.”  (AIU Ins. Co. v. Superior Court (1990) 51 Cal.3d 807, 
823, fn. 9; see id. at pp. 823–824.)  In the present case, despite 
the characterization of Endorsement No. 1 as a manuscript 
endorsement — which would normally imply that it contains 
nonstandard, negotiated provisions — the disputed coverage 
language under review is standard form language adopted 
verbatim 
from 
insurer-drafted 
policies. 
 
Under 
such 
circumstances, the insured — Yahoo! — cannot be charged with 
creating the ambiguity that led to the dispute, and therefore it 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
18 
is appropriate for courts to interpret any unresolvable 
ambiguities in Yahoo!’s favor.  (See Minkler v. Safeco Ins. Co., 
supra, 49 Cal.4th at p. 321; State of California v. Allstate Ins. 
Co., supra, 45 Cal.4th at p. 1018.) 
To summarize, we do not find Yahoo!’s broad reading of 
the coverage provision to be conclusive.  Rather, we agree with 
Yahoo! that the coverage provision is ambiguous and that the 
standard rules of contract interpretation do not resolve the 
ambiguity.  Because the provision is ambiguous, we conclude 
that it must be interpreted in a way that fulfills Yahoo!’s 
objectively reasonable expectations, which must be determined 
in further litigation.  Finally, if the foregoing procedures do not 
resolve the ambiguity, then we resort to the rule that 
ambiguities are to be resolved against the drafter, and here the 
insurer is considered to be the drafter of the specific coverage 
language whose meaning is in dispute. 
The federal district court, however, took a different 
approach, a point that we now address. 
B. The Rule of the Last Antecedent 
As noted above, the district court relied on the rule of the 
last antecedent in arriving at its conclusion that the policy in 
question did not cover the claims asserted against Yahoo!.  
According to the last antecedent rule, “[r]elative and qualifying 
words and phrases, grammatically and legally, where no 
contrary intention appears, refer solely to the last antecedent.”  
(Sutherland, Statutes and Statutory Construction (1891) § 267, 
p. 349; see Black’s Law Dict., supra, pp. 1532–1533.)  This rule 
of construction has been repeatedly recognized and applied by 
the United States Supreme Court (see, e.g., Lockhart v. United 
States (2016) 577 U.S. 347, 351; Barnhart v. Thomas (2003) 540 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
19 
U.S. 20, 26–27; FTC v. Mandel Brothers, Inc. (1959) 359 U.S. 
385, 389–390), and it was mentioned by the high court as early 
as 1799 (see Sims Lessee v. Irvine (1799) 3 U.S. 425, 444, fn. *). 
In California, reliance on the last antecedent rule dates 
back at least a century.  As formulated by this court, the rule 
provides that “ ‘ “qualifying words, phrases and clauses are to be 
applied to the words or phrases immediately preceding [them] 
and are not to be construed as extending to or including other[] 
[words or phrases] more remote.” ’ ”  (Renee J. v. Superior Court 
(2001) 26 Cal.4th 735, 743, quoting White v. County of 
Sacramento (1982) 31 Cal.3d 676, 680; see Los Angeles County 
v. Graves (1930) 210 Cal. 21, 26–27.)  The last antecedent rule 
is often applied where there is a list of terms, and the qualifying 
words or phrases follow the last item in the list.  (See People ex 
rel. Lockyer v. R.J. Reynolds Tobacco Co. (2003) 107 Cal.App.4th 
516, 530 [“The exemplar application of the last antecedent rule 
is a case where a modifying phrase appears after a list of 
multiple items or phrases”].)  But more generally, the last 
antecedent rule can be understood to express the same rules of 
English word order discussed in part II.A., ante, meaning that a 
restrictive 
relative 
clause 
usually 
modifies 
the 
noun 
immediately preceding it.  Employing the last antecedent rule 
in this manner, California courts have held that insurance 
policies using language similar to the language at issue here 
cover only right-of-secrecy liability, not right-of-seclusion 
liability. 
In ACS Systems, supra, 147 Cal.App.4th 137, for example, 
the court applied the last antecedent rule to a group of insurance 
policies that covered liability for “ ‘[m]aking known to any 
person or organization written or spoken material that violates 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
20 
an individual’s right of privacy.’ ”  (Id. at p. 143.)  The ACS 
Systems court read the clause “ ‘that violates an individual’s 
right of privacy’ ” as modifying only the word “ ‘material,’ ” not 
as modifying the phrase “ ‘[m]aking known.’ ”  (Id. at p. 150.)  
Hence, the court concluded that for there to be liability coverage, 
the content of the material, not the manner of making it known, 
had to violate someone’s privacy, meaning that the policy 
provided liability coverage only for disclosures that violated the 
right of secrecy.  (Id. at pp. 150, 152.)  A few years later, State 
Farm General Ins. Co. v. JT’s Frames, Inc. (2010) 181 
Cal.App.4th 429 (JT’s Frames) reached the same conclusion in 
a case in which the relevant insurance policies, like the policy at 
issue here, used the phrase “ ‘publication of,’ ” not the phrase 
“ ‘making known.’ ”  (Id. at p. 447.)10 
Not surprisingly, National Union relies on ACS Systems 
and JT’s Frames, but Yahoo! directs our attention to decisions 
from other jurisdictions that have rejected the rule of the last 
antecedent in the present context.  Yahoo! relies, for example, 
 
10  
Courts in several other jurisdictions have also reached the 
same conclusion as the court in ACS Systems.  (See Auto-Owners 
Ins. Co. v. Websolv Computing, Inc., supra, 580 F.3d at pp. 550–
551 [7th Cir. reaching same conclusion as ACS Systems, relying 
on the word “publication,” which, the court said, suggests the 
disclosure of secrets]; Subclass 2 of Master Class of Plaintiffs v. 
Melrose Hotel (3d Cir. 2007) 503 F.3d 339, 340 [3d Cir. reaching 
same conclusion as ACS Systems by approving a district court 
analysis similar to that of ACS Systems]; Resource Bankshares 
Corp. v. St. Paul Mercury Ins. Co., supra, 407 F.3d at p. 640 [4th 
Cir. reaching the same conclusion as ACS Systems]; American 
States Ins. Co. v. Capital Associates of Jackson County, supra, 
392 F.3d at p. 943 [7th Cir. reaching the same conclusion as ACS 
Systems].) 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
21 
on Penzer v. Transp. Ins. Co. (Fla. 2010) 29 So.3d 1000.  In 
Penzer, the Florida Supreme Court downplayed the significance 
of the rule of the last antecedent, noting that it is “not an 
absolute rule.”  (Id. at p. 1007.)  Interpreting policy language 
nearly identical to the language at issue here,11 the Penzer court 
concluded that the restrictive clause “that violates a person’s 
right of privacy” modifies both the word “publication” and the 
word “material.”  The court therefore held that the policy at 
issue in that case provided liability coverage when the manner 
of publication, not just the content of the published material, 
violated someone’s privacy.  (Ibid.) 
In our view, the rule of the last antecedent, as articulated 
in our case law, does not resolve the ambiguity in the policy 
language at issue here.  The rule of the last antecedent states 
that “ ‘ “qualifying words, phrases and clauses are to be applied 
to the words or phrases immediately preceding [them] . . . .” ’ ”  
(Renee J. v. Superior Court, supra, 26 Cal.4th at p. 743, italics 
added.)  As noted above, the rule is most readily applied where 
there is a list of several items, and the modifier comes 
immediately after the last item on the list.  (See People ex rel. 
Lockyer v. R.J. Reynolds Tobacco Co., supra, 107 Cal.App.4th at 
p. 
530; 
see 
also 
Sutherland, 
Statutes 
and 
Statutory 
Construction, supra, § 267, pp. 349–351.)  Here, however, there 
is no list of items followed immediately by a modifier; instead, 
there is the phrase “[o]ral or written publication, in any manner, 
of material” followed immediately by a modifier.  In applying the 
 
11  
The policy language at issue in Penzer omitted the words 
“in any manner” after the word “publication” but was otherwise 
the same as the language at issue here. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
22 
rule of the last antecedent, if we identify the possible 
antecedents as either (1) the word “publication,” or (2) the word 
“material,” then the word “material” would be the last 
antecedent.  But if, instead, we identify the possible antecedents 
as either (1) the entire phrase “[o]ral or written publication, in 
any manner, of material,” or (2) merely the final word of that 
phrase, “material,” then both potential antecedents would 
qualify as the last antecedent, as each would immediately 
precede the modifying restrictive clause.  Accordingly, the rule 
does not resolve, in the present case, whether the relative clause 
“that violates a person’s right of privacy” modifies just the word 
that immediately precedes it (i.e., the word “material”) or 
whether the clause modifies the entire phrase that immediately 
precedes it (i.e., the phrase “[o]ral or written publication, in any 
manner, of material”).  Therefore, we reach a different 
conclusion from the courts in ACS Systems, supra, 147 
Cal.App.4th 137 and JT’s Frames, supra, 181 Cal.App.4th 429, 
and find that the rule of the last antecedent does not resolve the 
ambiguity that characterizes coverage provisions like the one at 
issue here.12 
C.  The Advertising Injury Exclusion 
National Union asks us to apply the advertising injury 
exclusion of the policy to conclude that the policy does not cover 
 
12  
The case before us does not involve the phrase “making 
known,” a phrase that was at issue in ACS Systems, supra, 147 
Cal.App.4th 137, and that some courts have interpreted more 
narrowly than the phrase “publication of.”  (See Cynosure, Inc. 
v. St. Paul Fire and Marine Ins. Co. (1st Cir. 2011) 645 F.3d 1.)  
Therefore, we express no view on whether ACS Systems was 
correctly decided. 
YAHOO INC. v. NATIONAL UNION FIRE INSURANCE COMPANY OF 
PITTSBURGH, PA 
Opinion of the Court by Jenkins, J. 
 
23 
Yahoo!’s potential TCPA liability in the underlying lawsuits.  In 
the proceedings up to this point, however, National Union has 
not litigated the case based on the advertising injury exclusion, 
and the record before us does not indicate whether the text 
messages at issue here were advertisements as that term is 
defined in the policy.  Accordingly, we express no view on the 
question. 
III.  CONCLUSION 
We answer the Ninth Circuit’s question as follows:  A CGL 
insurance policy that provides coverage for “personal injury,” 
defined, in part, as “injury . . . arising out of . . . [o]ral or written 
publication, in any manner, of material that violates a person’s 
right of privacy,” can cover liability for violations of the right of 
seclusion if such coverage is consistent with the insured’s 
objectively reasonable expectations.  Such a policy can also 
trigger the insurer’s duty to defend the insured against a claim 
that the insured violated the TCPA by sending unsolicited text 
messages that did not reveal any private or secret information, 
provided that the alleged TCPA violation amounts to a right-of-
seclusion violation under California law.  The fact that such a 
policy has been modified by an endorsement with regard to 
advertising injuries may affect such coverage and such duty to 
defend, but we have no occasion to decide that issue here. 
JENKINS, J. 
We Concur: 
CANTIL-SAKAUYE, C. J. 
CORRIGAN, J. 
LIU, J. 
KRUGER, J. 
GROBAN, J. 
GUERRERO, J.
 
 
See next page for addresses and telephone numbers for counsel who 
argued in Supreme Court. 
 
Name of Opinion Yahoo Inc. v. National Union Fire Insurance 
Company of Pittsburgh, PA 
__________________________________________________________  
 
Procedural Posture (see XX below) 
Original Appeal  
Original Proceeding XX on request by 9th Circuit (Cal. Rules of 
Court, rule 8.548) 
Review Granted (published)  
Review Granted (unpublished)  
Rehearing Granted 
________________________________________________________  
 
Opinion No. S253593 
Date Filed:  November 17, 2022 
__________________________________________________________  
 
Court: 
County:   
Judge:  
__________________________________________________________   
 
Counsel: 
 
Jassy Vick Carolan and William T. Um for Plaintiff and Appellant. 
 
Hunton Andrews Kurth, Lorelie S. Masters, Kevin V. Small, 
Alexandrea H. Young; Reed Smith, Timothy P. Law and Andrew B. 
Breidenbach for United Policyholders as Amicus Curiae on behalf of 
Plaintiff and Appellant. 
 
Horvitz & Levy, Mitchell C. Tilner, Steven S. Fleischman, Emily V. 
Cuatto; Nicolaides Fink Thorpe Michaelides Sullivan, Richard H. 
Nicolaides, Jr., Daniel I. Graham, Jr., and Jodi S. Green for Defendant 
and Respondent. 
 
 
 
Counsel who argued in Supreme Court (not intended for 
publication with opinion): 
 
William T. Um 
Jassy Vick Carolan LLP 
355 South Grand Avenue, Suite 2450 
Los Angeles, CA 90071 
(310) 870-7048 
 
Steven S. Fleischman 
Horvitz & Levy LLP 
3601 West Olive Avenue, 8th Floor 
Burbank, CA 91505 
(818) 995-5824