Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_18-cv-02066/USCOURTS-caed-2_18-cv-02066-27/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 12:635 Breach of Insurance Contract

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UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

ZURICH AMERICAN INSURANCE 

COMPANY OF ILLINOIS,

Plaintiff,

v.

VFORCE INC., et al.,

Defendants.

No. 2:18-cv-02066-DAD-CKD

ORDER GRANTING DEFENDANT, CROSSCLAIMANT AND THIRD-PARTY 

PLAINTIFF VFORCE, INC.’S MOTION FOR 

PARTIAL SUMMARY JUDGMENT

(Doc. No. 198)

VFORCE INC.,

Cross-Claimant and 

Third-Party Plaintiff,

v.

CORTECH, LLC, et al.,

Cross-Defendant and 

Third-Party Defendants.

This matter is before the court on the motion for partial summary judgment filed by 

defendant, cross-claimant, and third-party plaintiff VForce Inc. (“VForce”) on July 29, 2024. 

(Doc. No. 198.) The pending motion was taken under submission on August 2, 2024. (Doc. No. 

202.) For the reasons explained below, the court will grant VForce’s motion for partial summary

judgment.

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BACKGROUND

This case arises from VForce, a staffing company, allegedly failing to pay the additional 

insurance premiums owed to plaintiff Zurich American Insurance Company of Illinois (“Zurich”) 

in breach of their workers’ compensation insurance contract. In its crossclaim and third-party 

complaint, VForce asserts that a different staffing company with whom it had entered into 

agreements, third-party defendant Bean Team Network 2 LLC (“BTN2”), along with its members 

and successors-in-interest who are also named as third-party defendants, is the entity responsible 

for paying any additional insurance premiums owed to Zurich. (Doc. Nos. 15, 119, 201.)

VForce brings the pending motion for partial summary judgment, seeking a judicial 

determination that pursuant to a contract entered into by VForce and BTN2 on December 22, 

2014: (i) BTN2 “was and is obligated to pay” those additional premiums; (ii) BTN2 breached the 

agreement by failing to pay such additional premiums; (iii) BTN2 was and is obligated “to defend 

and indemnify VForce in the present action” brought against VForce by Zurich; and (iv) BTN2 

breached the agreement by failing to defend and indemnify VForce after it was sued by Zurich. 

(Doc. No. 198-1 at 10.) VForce clarifies that its motion does not target the many other named 

third-party defendants, even though “BTN2 is no longer an active, operational entity,” because “a 

determination of the actual successor in interest to BTN2 with respect to liabilities involves the 

adjudication of many facts that are in dispute, and thus, is not suited for a motion for summary 

adjudication.”1 (Doc. No. 198-1 at 7.) Even though “VForce is not seeking a judgment against 

any named party through the present motion and is only seeking judicial findings,” VForce asserts 

that the court “[m]aking this determination now will greatly improve the effectiveness and 

efficiency of a subsequent trial by eliminating a foundational issue that underlies” VForce’s 

claims in its operative cross-complaint and third-party complaint. (Doc. No. 198 at 2.) 

1

 The court notes that despite VForce aiming this motion against third-party defendant BTN2, the 

opposition to the pending motion was filed on behalf of all but one of the third-party defendants 

(BTN2; Accuire, LLC; Capserv, Inc.; KaiserKane Consulting, LLC; Michael DiManno; Richard 

Gardner; Charles Musgrove; and Melissa Oglesby) (collectively, “the third-party defendants”). 

(Doc. No. 204.) Third-party defendant Employinsure LLC, for whom a summons was not issued 

until September 3, 2024, is not one of the parties opposing VForce’s pending motion. (See Doc. 

No. 210.) 

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A. Factual Background2

VForce agreed to purchase a workers’ compensation policy from Zurich together with 

BTN2. (UF ¶ 1.) After being assured of the propriety and legality of such an agreement, VForce 

entered into an agreement with BTN2 that governed the parties’ obligations respecting the joint 

workers’ compensation policy. (UF ¶ 2.) After negotiations primarily between third-party 

defendant Charles Musgrove (“Musgrove”) on behalf of BTN2, and Mark Nobili3(“Nobili”) on 

behalf of VForce, the parties entered into an agreement on December 22, 2014 (the 

“Agreement”).

4

 (UF ¶ 3.)

While the Agreement covered many different aspects of the relationship between the 

parties, only certain provisions governed BTN2’s obligations to pay all premiums and to defend

and indemnify VForce in any action brought by Zurich seeking premiums. (UF ¶ 4.) The 

Agreement refers to VForce as “VF.” (UF ¶ 5.) Section 4(a) of the Agreement provided in

pertinent part:

BTN 2 shall pay the premiums on behalf of VF on the Zurich 

worker’s compensation policy as may be held by VF (the “Policy”). 

These monthly premium payments currently are approximately

Ninety Eight Thousand Dollars and No/100 ($98,000.00.) [sic] To 

the extent any such payments exceed the amount of the actual Policy

premiums due, such excess amounts shall be returned to BTN 2. Any 

underpayments on the Policy premiums shall be the responsibility of

BTN 2.

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 The relevant facts that follow are undisputed unless otherwise noted and are derived from the 

undisputed facts as stated by VForce and responded to by the third-party defendants (Doc. 

No. 204-1 (“UF”)), as well as the declarations and attached exhibits filed by the parties in support 

of their respective briefs (Doc. Nos. 198-3–198-5; 204-2–204-3; 205-1). The court notes that the 

third-party defendants did not file their own “concise ‘Statement of Disputed Facts,’ and the 

source thereof in the record, of all additional material facts as to which there is a genuine issue 

precluding summary judgment or adjudication,” as permitted by Local Rule 260(b).

3

 In his declaration, Nobili states that at all relevant times, he “was a founding partner, 

shareholder, and Vice President at VForce.” (Doc. No. 198-3 at ¶ 3.)

4

 Although the third-party defendants purport to “deny” this fact, their denial is based on their 

assertion that the agreement was also negotiated by Mani Kontokanis. (UF ¶ 3.) But that 

assertion does not serve to contradict or dispute VForce’s asserted undisputed fact that Musgrove 

and Nobili primarily negotiated the Agreement.

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(UF ¶ 6.) Section 4(d) of the Agreement further distilled BTN2’s obligation by stating in 

pertinent part: “For the avoidance of doubt, any increased costs (including increases in the Policy

premiums) associated therewith shall be the responsibility of BTN 2.” (UF ¶ 7.) Section 7(a) of 

the Agreement provided in pertinent part:

To the fullest extent permitted by law, BTN 2 will defend, indemnify, 

and hold VF and its members, directors, officers, agents,

representatives, and employees harmless from all claims, losses, and 

liabilities (including reasonable attorneys’ fees) to the extent caused

by BTN 2’s breach of this Agreement; its failure to discharge its 

duties and responsibilities; the negligence, gross negligence, or 

unlawful acts of BTN 2 or its officers, employees, or authorized 

agents in the discharge of those duties and responsibilities.

(UF ¶ 9.) Section 14(j) of the Agreement also contained an integration clause that provided in 

pertinent part:

Entire Agreement. This Agreement contains the entire 

understanding between and among the parties and supersedes any 

prior understandings and agreements among them respecting the 

subject matter of this Agreement. Each party (and its members) on

the one hand represents and warrants that it does not have, and shall 

not make, any arrangements with the party (or its members) on the 

other hand for the duration of the Agreement related to the subject 

matter of this Agreement without written disclosure to all parties 

(and its members).

(UF ¶ 10.) 

Upon termination of the Zurich insurance policy, Zurich performed an audit of the

previous year pursuant to “Part Five – Premium, Section G. Audit and the Optional Premium

Increase Endorsement – California” of the Policy. (UF ¶ 11.) On or about July 2016, VForce 

learned that Zurich was performing an audit on the policy for the prior year. (UF ¶ 12.) In or 

around July of 2016, Zurich announced the results of its audit to BTN2. (UF ¶ 13.) After its

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audit, Zurich determined that VForce owed an additional $612,669.00 in premiums under the 

Policy.

5

 (UF ¶ 14.)

On January 30, 2019, Zurich filed its operative first amended complaint (“FAC”) in this 

action, alleging that VForce breached the Policy by failing to pay the additional $612,669 

allegedly found to be due as a result of the audit.6 (UF ¶¶ 15–16.) Interest and attorneys’ fees 

have since accrued and Zurich is now demanding nearly double that amount. (UF ¶ 16.) BTN2 

did not defend VForce after it was served with the FAC and VForce’s third-party complaint. (UF 

¶ 17.) Neither BTN2 nor its successors in interest paid any of the increased policy premiums 

assessed by Zurich.

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 (UF ¶ 18.) VForce performed all of its contractual obligations as set forth in 

the December 22, 2014 Agreement. (UF ¶ 19.)8

B. Procedural Background

On March 12, 2019, VForce filed a crossclaim against defendant Cortech, LLC and a 

third-party complaint against third-party defendants BTN2; Accuire, LLC; Capserv, Inc.; 

5

 According to VForce, this additional premium amount was due to “the additional employees 

added to its overall staff as a result of its agreements with BTN2.” (UF ¶ 14.) The third-party 

defendants purport to dispute this fact by asserting that during the policy period, premium 

increases due to the expanding payroll of third-party defendant Accuire, LLC (“Accuire”) were 

paid by Accuire in advance. (Id.) As discussed below, this apparent disagreement is not material 

to the pending motion because the text of the Agreement does not condition or limit BTN2’s 

responsibility to pay “[a]ny underpayments on the Policy premiums” as only arising in a 

particular situation, such as when the increase in the amount of premiums due is caused by 

Accuire’s expanding payroll.

6

 Zurich named one other defendant in its first amended complaint, defendant Cortech LLC, and 

alleges that “VForce merged with and became the wholly owned subsidiary of Cortech” on April 

23, 2018. (Doc. No. 6 at ¶ 13.) Defendant Cortech LLC is not mentioned in the pending motion.

7

 The third-party defendants purport to dispute this fact but the evidence to which they cite does 

not support their contention. (UF ¶ 18.)

8

 VForce filed objections to certain evidence submitted by the third-party defendants in support 

of their opposition to the pending motion. (See Doc. No. 205-2.) Because the court will grant 

VForce’s motion and would do so even if the court considered the evidence that VForce has 

objected to, the court need not substantively address VForce’s objections. The third-party 

defendants also filed objections to certain evidence submitted by VForce in support of its pending 

motion. (See Doc. No. 207.) Because the court does not rely on that evidence in resolving the 

pending motions, the third-party defendant’s objections are overruled as having been rendered 

moot by this order.

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Kaiserkane Consulting, LLC; Michael DiManno; Richard Gardner; Charles Musgrove; Melissa 

Oglesby; Hybrid Financial Group, LLC; and Charles Forbes. (Doc. No. 15 at 1–3.) On May 26, 

2020, the previously-assigned district judge granted VForce’s motion for leave to amend its 

crossclaim and its third-party complaint and granted Charles Forbes’s motion to dismiss VForce’s 

claims asserted against him with leave to amend. (Doc. No. 67.) The previously-assigned district 

judge also granted VForce further leave to amend its crossclaim and third-party complaint on 

February 2, 2022. (Doc. No. 118.)9 The undersigned granted VForce leave to file its third 

amended crossclaim and third-party complaint on July 30, 2024. (Doc. No. 199.) On August 2, 

2024, VForce filed the operative third amended crossclaim against Cortech, LLC; BTN2; 

Accuire; Capserv, Inc.; Kaiserkane Consulting, LLC; Michael DiManno; Richard Gardner; 

Charles Musgrove; and Melissa Oglesby (collectively, “the cross-defendants”); and third-party 

complaint against Amazing Insurance, Inc; Alex Campos; and Employinsure LLC. (Doc. 

No. 201.) In its third amended crossclaim and third-party complaint, VForce asserts the 

following claims: (1) breach of contract, against all cross- and third-party defendants; (2) breach 

of the implied covenant of good faith and fair dealing, against all cross- and third-party 

defendants; (3) express indemnity, against all cross- and third-party defendants; (4) equitable 

indemnity, against the cross-defendants; (5) false promise, against the cross-defendants; 

(6) intentional misrepresentation, against the cross-defendants; (7) negligent misrepresentation, 

against the cross-defendants; (8) conspiracy, against the cross-defendants; and (9) unfair 

competition in violation of California Business and Professions Code §§ 17200, et seq., against 

the cross-defendants. (Id.)

On July 29, 2024, VForce filed the pending partial motion for summary judgment in its 

favor. (Doc. No. 198.) On August 12, 2024, BTN2; Accuire; Capserv, Inc.; Kaiserkane

Consulting, LLC; Michael DiManno; Richard Gardner; Charles Musgrove; and Melissa Oglesby 

(“the third-party defendants”) filed an opposition to the pending motion. (Doc. No. 204.) On 

August 22, 2024, VForce filed its reply thereto. (Doc. No. 205.) On August 29, 2024, the third9

 On August 25, 2022, this matter was reassigned to the undersigned. (Doc. No. 132.)

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party defendants filed a motion for leave to file a surreply to VForce’s reply. (Doc. No. 206.) 

The court granted leave to file a surreply on August 30, 2024 (Doc. No. 208), and the third-party 

defendants filed their surreply that same day (Doc. No. 209).

LEGAL STANDARD

Summary judgment is appropriate when the moving party “shows that there is no genuine 

dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. 

Civ. P. 56(a). 

In summary judgment practice, the moving party “initially bears the burden of proving the 

absence of a genuine issue of material fact.” In re Oracle Corp. Sec. Litig., 627 F.3d 376, 387 

(9th Cir. 2010) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). The moving party 

may accomplish this by “citing to particular parts of materials in the record, including 

depositions, documents, electronically stored information, affidavits or declarations, stipulations 

(including those made for purposes of the motion only), admissions, interrogatory answers, or 

other materials,” or by showing that such materials “do not establish the absence or presence of a 

genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.” 

Fed. R. Civ. P. 56(c)(1)(A), (B). When the non-moving party bears the burden of proof at trial, 

“the moving party need only prove that there is an absence of evidence to support the non-moving 

party’s case.” Oracle Corp., 627 F.3d at 387 (citing Celotex, 477 U.S. at 325); see also Fed. R. 

Civ. P. 56(c)(1)(B). Indeed, after adequate time for discovery and upon motion, summary 

judgment should be entered against a party who fails to make a showing sufficient to establish the 

existence of an element essential to that party’s case, and on which that party will bear the burden 

of proof at trial. See Celotex, 477 U.S. at 322. “[A] complete failure of proof concerning an 

essential element of the nonmoving party’s case necessarily renders all other facts immaterial.” 

Id. at 322–23. In such a circumstance, summary judgment should be granted, “so long as

whatever is before the district court demonstrates that the standard for the entry of summary 

judgment . . . is satisfied.” Id. at 323.

If the moving party meets its initial responsibility, the burden then shifts to the opposing 

party to establish that a genuine issue as to any material fact actually does exist. See Matsushita 

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Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). In attempting to establish the 

existence of this factual dispute, the opposing party may not rely upon the allegations or denials 

of its pleadings but is required to tender evidence of specific facts in the form of affidavits or 

admissible discovery material in support of its contention that the dispute exists. See Fed. R. Civ. 

P. 56(c)(1); Matsushita, 475 U.S. at 586 n.11; Orr v. Bank of Am., NT & SA, 285 F.3d 764, 773 

(9th Cir. 2002) (“A trial court can only consider admissible evidence in ruling on a motion for 

summary judgment.”). The opposing party must demonstrate that the fact in contention is 

material, i.e., a fact that might affect the outcome of the suit under the governing law, and that the 

dispute is genuine, i.e., the evidence is such that a reasonable jury could return a verdict for the 

non-moving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 250 (1986).

In the endeavor to establish the existence of a factual dispute, the opposing party need not 

establish a material issue of fact conclusively in its favor. It is sufficient that “the claimed factual 

dispute be shown to require a jury or judge to resolve the parties’ differing versions of the truth at 

trial.” T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 626, 630 (9th Cir. 1987). 

Thus, the “purpose of summary judgment is to ‘pierce the pleadings and to assess the proof in 

order to see whether there is a genuine need for trial.’” Matsushita, 475 U.S. at 587 (citations 

omitted).

“In evaluating the evidence to determine whether there is a genuine issue of fact,” the 

court draws “all inferences supported by the evidence in favor of the non-moving party.” Walls v. 

Cent. Contra Costa Transit Auth., 653 F.3d 963, 966 (9th Cir. 2011). It is the opposing party’s 

obligation to produce a factual predicate from which the inference may be drawn. See Richards 

v. Nielsen Freight Lines, 602 F. Supp. 1224, 1244–45 (E.D. Cal. 1985), aff’d, 810 F.2d 898 (9th 

Cir. 1987). Finally, to demonstrate a genuine issue, the opposing party “must do more than 

simply show that there is some metaphysical doubt as to the material facts. . . . Where the record 

taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no 

‘genuine issue for trial.’” Matsushita, 475 U.S. at 586–87 (citations omitted).

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ANALYSIS

A. Whether BTN2 Is Obligated to Pay the Additional Premiums

VForce moves for summary judgment in its favor as to whether BTN2 was obligated 

under the Agreement to pay the additional premiums assessed by Zurich. (Doc. No. 198-1 at 8.) 

The Agreement is governed by Florida law. (See Doc. No. 198-5 at 65.) “Under Florida law, 

clear and unambiguous contract language may be interpreted as a matter of law.” Vathana v. 

EverBank, 770 F.3d 1272, 1277 (9th Cir. 2014) (citing Smith v. Shelton, 970 So. 2d 450, 451 (Fla. 

Dist. Ct. App. 2007)). “Whether contract language is ambiguous is also a question of law.” Id.

(citing Smith, 970 So. 2d at 451). “A contract’s wording is ambiguous if it is ‘reasonably 

susceptible to more than one interpretation.’” Id. (quoting Lambert v. Berkley S. Condo. Ass’n, 

680 So.2d 588, 590 (Fla. Dist. Ct. App. 1996)). “If the wording is ambiguous, interpreting the 

contract involves a factual question and summary judgment is inappropriate.” Id. (citing Smith, 

970 So. 2d at 451). “In the absence of an ambiguity on the face of a contract, it is well settled that 

the actual language used in the contract is the best evidence of the intent of the parties, and the 

plain meaning of that language controls.” Roskovensky v. Sanibel Captiva Island Vacation 

Rentals, LLC, No. 22-cv-00602-JLB-NPM, 2024 WL 1140893, at *6 (M.D. Fla. Mar. 15, 2024) 

(quoting Acceleration Nat’l Serv. Corp. v. Brickell Fin. Servs. Motor Club, Inc., 541 So. 2d 738, 

739 (Fla. Dist. Ct. App. 1989)). 

It is undisputed that § 4(a) of the Agreement states: “BTN 2 shall pay the premiums on 

behalf of VF on the Zurich worker’s compensation policy as may be held by VF (‘the Policy’). 

. . . Any underpayments on the Policy premiums shall be the responsibility of BTN 2.” (Doc. 

No. 198-5 at 62.) It is further undisputed that § 4(d) provides: “For the avoidance of doubt, any 

increased costs (including increases in the Policy premiums) associated therewith shall be the 

responsibility of BTN 2.” (Id.) Accordingly, the court easily concludes that the wording of the 

Agreement is not reasonably susceptible to more than one interpretation regarding BTN2’s 

obligation to pay the premiums and is therefore not ambiguous. 

In so finding, the court is not persuaded by the third-party defendants’ argument that 

§ 4(a) of the Agreement “contains a latent ambiguity under Florida law, as shown by the parties[’] 

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subsequent course of performance.”10 (Doc. No. 204 at 5.) “A latent ambiguity is said to exist 

where a contract fails to specify the rights or duties of the parties in certain situations and 

extrinsic evidence is necessary for interpretation or a choice between two possible meanings.” 

MDS (Canada) Inc. v. Rad Source Techs., Inc., 720 F.3d 833, 844 (11th Cir. 2013) (quoting 

Forest Hills Util., Inc. v. Pasco Cnty., 536 So. 2d 1117, 1119 (Fla. Dist. Ct. App. 1988)). Here, 

the third-party defendants simply assert, without any further explanation, that “the ambiguity in 

Section 4(a)’s language (‘BTN2 shall pay the premiums on behalf of VF on the Zurich workers’ 

compensation policy as may be held by VF’) is evident.” (Doc. No. 204 at 5) (emphasis in 

original). The court disagrees with the third-party defendants in this regard. In the view of the 

undersigned, no ambiguity is evident, either in § 4(a) or in any material provision of the 

Agreement. Furthermore, the third-party defendants do not offer any suggestion as to what the 

phrase “as may be held by VF” could refer to, other than the workers’ compensation policy that 

VForce and BTN2 agreed to purchase from Zurich.

Without explaining the nature of the ambiguity in the Agreement, the third-party 

defendants then describe the following purported course of performance that, they argue, clarifies 

the supposed ambiguity: The third-party defendants argue that BTN2 had earlier made another, 

separate agreement with VForce (“the Other Agreement”). (Id.; see also Doc. No. 204-3 at 23–

27.) The third-party defendants contend that under the Other Agreement, BTN2 had been 

obligated to make payments to VForce. (Doc. No. 204 at 5–7.) To explain the undisputed fact 

that BTN2 did pay workers’ compensation premiums to Zurich, the third-party defendants argue 

that it paid those premiums merely for the sake of VForce’s convenience. (Id.) Specifically, they 

argue that rather than make payments under the Other Agreement to VForce, who would then in 

turn have to pay premiums to Zurich, BTN2 simply made payments to Zurich directly and 

thereby cut out the middle-man—that is, VForce. (Id.) Notably, there is no mention of the Other 

Agreement in the Agreement. Instead, § 14(j) of the Agreement states: “This Agreement 

10

 The third-party defendants note that they are not arguing that the course of performance 

established a modification to the Agreement. (Doc. No. 204 at 6.) They argue only that the 

course of performance is relevant for purposes of clarifying the terms of the Agreement. (Id. at 

6–7.)

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contains the entire understanding between and among the parties and supersedes any prior 

understandings and agreements among them respecting the subject matter of this Agreement.” 

(Doc. No. 198-5 at 65–66.)

However, this alleged11 course of performance does not “clarify” any terms or provisions

of the Agreement. In particular, it is entirely unclear how this course of performance clarifies the 

phrase “as may be held by VF” in the Agreement, as argued by the third-party defendants. 

Instead, the course of performance described by the third-party defendants directly contradicts the 

express language of the Agreement, which clearly and repeatedly requires BTN2 to pay the 

premiums. The Florida Supreme Court has recognized:

Where the terms of a written agreement are in any respect doubtful 

or uncertain, or if the contract contains no provisions on a given point 

. . . and the parties to it have, by their own conduct, placed a 

construction upon it which is reasonable, such construction will be 

adopted by the court, upon the principle that it is the duty of the court 

to give effect to the intention of the parties where it is not wholly at 

variance with the correct legal interpretation of the terms of the 

contract.

Blackhawk Heating & Plumbing Co., Inc. v. Data Lease Fin. Corp., 302 So. 2d 404, 407 (Fla. 

1974); see also United States ex rel. GLF Constr. Corp. v. FEDCON Joint Venture, No. 17-cv01932-CES, 2019 WL 5295329, at *12 (M.D. Fla. Oct. 18, 2019) (“The intention of the parties, 

when not clearly expressed, may also be demonstrated by conduct.”) (applying Florida law)

(emphasis added). Here, the terms of the Agreement are not in any respect doubtful or uncertain, 

the contract contains multiple provisions specifically addressing the relevant points, the thirdparty defendants’ proposed construction is not reasonable, and a finding that BTN2 is not 

obligated to pay the premiums would be “wholly at variance with the correct legal interpretation 

of the terms of the contract.” Blackhawk Heating, 302 So. 2d at 407. The court finds that the

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 For the reasons discussed in this order, the course of performance described by the third-party 

defendants, even if appropriately supported by evidence before the court on summary judgment,

would not provide any basis upon which to deny VForce’s motion for summary judgment. 

Accordingly, the court need not—and therefore does not—consider whether the third-party 

defendants have come forward on summary judgment with any admissible evidence in support of 

their contention in this regard.

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intent of the parties as to BTN2’s obligation to pay the premiums was clearly expressed in the 

Agreement.

Accordingly, in light of the express and unambiguous terms of the Agreement, the court 

finds no genuine dispute of material fact as to BTN2’s obligation to pay the premiums on the 

workers’ compensation policy. See Roskovensky, 2024 WL 1140893, at *6 (“In the absence of an 

ambiguity on the face of a contract, it is well settled that the actual language used in the contract 

is the best evidence of the intent of the parties, and the plain meaning of that language controls.”) 

(quoting Acceleration Nat’l Serv. Corp., 541 So. 2d at 739).

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B. Whether BTN2 Breached the Agreement by Failing to Pay the Premiums

VForce moves also for summary judgment in its favor as to whether BTN2 breached the 

Agreement by not paying the additional premiums assessed by Zurich. (Doc. No. 198-1 at 1–2.) 

The court has already concluded above that there is no genuine dispute of material fact as to 

BTN2’s obligation to pay the additional premiums assessed by Zurich. It is also undisputed that 

BTN2 did not pay those premiums.

The third-party defendants raise two arguments in their opposition, both of which are 

unpersuasive. First, they argue that the Agreement was terminated pursuant to § 13(g) of the 

Agreement when BTN2 exercised the option to reacquire full ownership of Accuire. (See Doc. 

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 The parties appear to believe that this dispute is governed by the Uniform Commercial Code as 

adopted by Florida (“the UCC”). (See Doc. Nos. 204 at 6 (the third-party defendants citing to 

Florida Statute § 671.205); 205 at 8–9 (VForce citing to the same)). The court notes that under 

Florida law, “[c]ontract disputes are governed by the common law if the contract was for services 

or the Uniform Commercial Code (UCC) if the contract was for goods.” Medmoun v. Home 

Depot U.S.A., Inc., No. 21-cv-01585-KKM-CPT, 2022 WL 1443919, at *9 (M.D. Fla. May 7, 

2022) (citing Allied Shelving & Equip., Inc. v. Nat’l Deli, LLC, 154 So. 3d 482, 483 (Fla. Dist. Ct. 

App. 2015)). However, the outcome of the pending motion does not depend on whether the 

common law or the UCC applies. Indeed, while the third-party defendants appear to rely on 

Florida Statute § 671.205(1) in support of their argument regarding the course of performance, 

the court notes that another provision of that statute states that “the express terms of an agreement 

and any applicable course of performance . . . must be construed whenever reasonable as 

consistent with each other. If such a construction is unreasonable: (a) Express terms prevail over 

course of performance . . . .” Fla. State. § 671.205(5). Here, as discussed above, the express 

terms of the Agreement obligated BTN2 to pay the additional premiums assessed by Zurich. 

These terms cannot reasonably be construed as consistent with a course of performance

purportedly suggesting that BTN2 was not so obligated. The express terms would prevail even 

under such circumstances pursuant to § 671.205(5).

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No. 204 at 7; see also Doc. No. 198-5 at 64 (“(g) If BTN2 exercises the option, the Agreement 

terminates.”)). The third-party defendants contend that because the Agreement was terminated 

upon the exercise of the option, BTN2 therefore never had an obligation to pay any of VForce’s 

premiums in the first place. (Doc. No. 204 at 7.) Consequently, the third-party defendants argue, 

it was not in breach “for failing to [pay the premiums] before or after the Agreement terminated 

. . . .” (Id.) In reply, VForce argues that this argument “that somehow BTN2 never breached the 

Agreement because it never had an obligation to pay the premiums . . . is nonsensical and devoid 

of any factual support from the Agreement itself or any legal authority whatsoever.” (Doc. 

No. 205 at 5.) VForce further argues that the third-party defendants have provided “no facts or 

legal authority that would support the conclusion that the termination of an agreement absolves a 

party of all past duties, obligations and breaches of that agreement because there is none.” (Id. at 

6.) The court agrees with VForce in this regard. That Zurich conducted the audit and discovered 

the unpaid premiums after the Agreement had terminated does not somehow relieve BTN2 of its 

already-incurred obligation to pay the premiums relating to the period of time for which the 

Agreement was in existence.

Second, the third-party defendants argue that the additional premiums assessed by Zurich 

did not result from an increase in Accuire’s payroll, as alleged by VForce. (Doc. No. 204 at 7.) 

But as noted above, nothing in the Agreement suggests that BTN2 was only obligated to pay the 

premiums under certain conditions or for certain reasons. Rather, the clear text of the Agreement 

states without qualification that “[a]ny underpayments on the Policy premiums shall be the 

responsibility of BTN 2.” (See Doc. No. 198-5 at 62.)

Accordingly, the court concludes that there is no genuine dispute of material fact as to 

BTN2’s breach of the Agreement in this regard.

C. Whether BTN2 Breached the Agreement by Failing to Defend and Indemnify 

VForce

Next, VForce moves for summary judgment in its favor as to whether BTN2 was 

obligated to defend and indemnify VForce when it was sued by Zurich, and as to whether BTN2 

breached the Agreement when it failed to do so. (Doc. No. 198-1 at 10.) It is undisputed that 

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§ 7(a) of the Agreement states that “BTN 2 will defend, indemnify, and hold VF . . . harmless 

from all claims, losses, and liabilities (including reasonable attorneys’ fees) to the extent caused 

by BTN 2’s breach of this Agreement . . . .” (UF ¶ 9.) The third-party defendants do not dispute 

that BTN2 did not defend and indemnify VForce when it was sued by Zurich. Instead, they argue 

only that BTN2 was not obligated to do so because the claims in the suit brought by Zurich were 

not the result of BTN2’s breach of the Agreement. (Doc. No. 204 at 7; see also Doc. No. 204-1 at 

5.) As discussed above, the court has rejected the third-party defendants’ argument in this regard. 

The court has found no genuine dispute of material fact that BTN2 was obligated to pay the 

additional premiums sought by Zurich and breached by failing to do so. Accordingly, the court 

concludes that there is no genuine dispute of material fact that BTN2 was obligated to defend and 

indemnify VForce when it was sued by Zurich, and that BTN2 breached the Agreement when it 

failed to do so.

CONCLUSION

Cross-defendant and third-party plaintiff VForce Inc. (“VForce”) has moved for partial 

summary judgment seeking a judicial determination that: (i) cross- and third-party-defendant 

Bean Team Network 2 LLC (“BTN2”) was and is obligated to pay the additional premiums 

assessed by plaintiff Zurich American Insurance Company of Illinois (“Zurich”); (ii) BTN2 

breached the Agreement by failing to pay such additional premiums; (iii) BTN2 was and is 

obligated to defend and indemnify VForce in the present action brought against VForce by 

Zurich; and (iv) BTN2 breached the agreement by failing to defend and indemnify VForce after 

VForce was sued by Zurich. (Doc. No. 198.) For the reasons discussed above, VForce’s motion 

for partial summary judgment in its favor is hereby granted.

IT IS SO ORDERED.

Dated: October 8, 2024 

DALE A. DROZD

UNITED STATES DISTRICT JUDGE

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