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UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

FEDERATED MUTUAL 

INSURANCE COMPANY,

Plaintiff,

v.

SERVICE KING PAINT & BODY, 

LLC

Defendant.

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Civil Action No. 3:22-cv-02484-G

FEDERATED’S MOTION FOR ENTRY OF DEFAULT JUDGMENT

TO THE HONORABLE COURT:

Plaintiff Federated Mutual Insurance Company (“Federated”), by and through its 

undersigned attorneys, hereby moves the Court for Entry of Default Judgment against 

Defendant Service King Paint & Body, LLC (“Service King”) Pursuant to Fed. R. Civ. P. 

55(b)(2). As grounds therefor, Federated states as follows: 

MOTION FOR ENTRY OF DEFAULT JUDGMENT

1. Plaintiff Federated seeks entry of a default judgment at this time pursuant to 

Fed. R. Civ. P. 55(b)(2). All matters raised in the Complaint may properly be decided by 

the Court as a matter of law, and Federated seeks a judicial determination that it does not 

owe any duty to defend or indemnify Service King for the claims currently pending in the 

Cook County, Illinois, Circuit Court in the underlying lawsuit between Anibal Romo and 

Service King (“Underlying Lawsuit”). In support of the request for entry of default 

judgment, Federated shows the following undisputed facts and legal arguments.
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2. As of the filing of this motion, Service King has not made an appearance in 

this action. A Clerk’s Default was entered on December 16, 2022. (Dkt. 13).

3. On May 13, 2022, Anibal Romo sued Service King for alleged violations of 

the Illinois Biometric Information Privacy Act (“BIPA”) in the Underlying Lawsuit. 

4. Federated is defending Service King against the claims in the Underlying 

Lawsuit subject to a reservation of rights. (Declaration of Johnathan M. Nelson, ¶ 3).

I. The Underlying Complaint.

5. The Complaint in the Underlying Lawsuit (“Underlying Complaint”) alleges 

that Service King violated Sections 15(a), (b) and (e) of BIPA by electronically collecting 

and storing its customers’ fingerprints without their permission. (Nelson Decl., Ex. 1, 

Underlying Complaint).

6. The Underlying Complaint further alleges that Service King violated BIPA 

by:

• failing to develop and/or make public its written retention schedule or 

guidelines for permanently destroying biometric identifiers and biometric 

information as specified by BIPA;

• collecting, capturing, obtaining and storing Plaintiff's and class members' 

biometric identifiers and/or information without informing them in writing 

and obtaining a written release, that:

(a) The biometric data was being recorded, obtained, collected, or stored; 

and

(b) The specific purpose and length of term for which the biometric data 

was being collected, captured, obtained, and/or stored;

• by failing to store class members biometric data using the reasonable 

standard of care within its industry and/or in a manner that is the same as or 

more protective than the manner in which the private entity stores, transmits, 

and protects other confidential and sensitive information.
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(Id., ¶¶ 14-23).

7. The Underlying Complaint also alleges that Service King did not disclose to 

Plaintiff the identities of any third parties with whom Service King was directly or 

indirectly sharing, disclosing, or otherwise disseminating class members' biometric data. 

(Id., ¶ 24).

8. The Underlying Complaint also alleges that Service King Defendant is 

storing its data in a manner less secure than it stores other similarly sensitive data. (Id., ¶ 

25).

9. The Underlying Complaint seeks to seeks to certify a class action pursuant 

to 735 ILCS § 5/2-801 on behalf of “[a]ll individuals whose biometric data Defendant 

collected or stored in Illinois.” (Id., ¶ 26).

10. The Underlying Complaint seeks statutory, liquidated, and/or actual 

damages, and injunctive relief. (Id., Prayers for Relief).

11. Federated insured Service King under Commercial Package policies of 

insurance for six annual periods from December 1, 2016 through December 1, 2022

(“Federated Policies”). True and correct copies of relevant excerpts of the Federated 

Policies, which are identical in all relevant respects, are attached as Exhibits 2, 3, 4, 5, 6 

and 7. 

II. Personal and Advertising Injury Coverage Does Not Apply.

12. The Federated Policies’ Personal and Advertising Injury Liability Insuring 

agreement provides in relevant part as follows:

1. Insuring Agreement
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a. We will pay those sums that the insured becomes legally obligated to 

pay as damages because of “personal and advertising injury to which 

this insurance applies. We will have the right and duty to defend the 

insured against any “suit” seeking those damages. However, we will 

have no duty to defend the insured against any “suit” seeking damages 

for “personal and advertising injury” to which this insurance does not 

apply. . . . 

b. This insurance applies to “personal and advertising injury” caused by 

an offense arising out of your business but only if the offense was 

committed in the “coverage territory” during the policy period.

(Exs. 2-7 at Commercial General Liability Coverage Form, Coverage B - Personal and 

Advertising Injury Liability).

13. The Federated Policies define “personal and advertising injury” in pertinent 

part as:

14. “Personal and advertising injury” means injury, including consequential 

“bodily injury”, humiliation, mental anguish or shock, arising out of one or 

more of the following offenses:

* * *

e. Oral or written publication, in any manner, of material that violates a 

person’s right of privacy;

(Id., Section V – Definitions)

14. Federated has no duty to defend or indemnify Service King under the 

Personal and Advertising Injury Liability coverage because the Underlying Complaint does 

not allege that Service King “published” copies of the underlying plaintiff’s biometric data.

Texas applies the “eight corners” rule – i.e., comparison of the factual allegations of the 

underlying petition to the terms of the insurance policy only – to determine whether an 

insurer owes an insured a duty to defend. Nutmeg Ins. Co. v. Clear Lake City Water Auth., 
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229 F. Supp. 2d 668, 676 (S.D. Tex. 2002) (citations omitted). Terms in a policy are given 

their ordinary and generally accepted meaning, and the insured bears the burden of 

demonstrating that its claim is potentially within the insurance policy's scope of coverage.

Id.

15. The term “publication” is defined as “communication (as of news or 

information) to the public: public announcement” or as “the act or process of issuing copies 

(as a book, photograph, or musical score) for general distribution to the public.” See

Creative Hosp. Ventures, Inc. v. U.S. Liab. Ins. Co., 444 F. App'x 370, 374 (11th Cir. 2011)

(citing Webster's Third New International Dictionary 1836 (1981)). Likewise, to publish 

is “to place before the public (as through a mass medium): DISSEMINATE.” Id. (citing

Webster’s at 1837 and holding “publication” as used in Personal and Advertising Injury 

Coverage did not include a merchant's provision of a receipt to a customer during a retail 

transaction). Here, the Underlying Complaint does not trigger Personal and Advertising 

Injury coverage because it does not allege Service King “published” plaintiff’s biometric 

data, but rather alleges only that Service King collected and stored that data. 

16. The Personal and Advertising Injury Liability coverage contains an exclusion 

for Recording And Distribution Of Material Or Information In Violation Of Law, which 

provides:

p. Recording And Distribution Of Material Or Information In Violation 

Of Law 

”Personal and advertising injury” arising directly or indirectly out of any 

action or omission that violates or is alleged to violate:
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(1) The Telephone Consumer Protection Act (TCPA including any 

amendment of or addition to such law;

(2) The CAN-SPAM Act of 2003, including any amendment of or 

addition to such law;

(3) The Fair Credit Reporting Act (FCRA), and any amendment of or 

addition to such law, including the Fair and Accurate Credit 

Transactions Act (FACTA); or

(4) Any federal, state or local statute, ordinance or regulation, other than 

the TCPA, CAN-SPAM Act of 2003 or FCRA and their amendments 

and additions, that addresses, prohibits, or limits the printing, 

dissemination, disposal, collecting, recording, sending, transmitting, 

communicating or distribution of material or information.

(Id., Coverage B, Exclusions).

17. Personal and Advertising Injury Liability coverage is excluded because the 

Underlying Complaint alleges violation of BIPA, a state statute that regulates the collection 

and communication of the underlying plaintiffs’ biometric data. See Cont’l W. Ins. Co. v. 

Cheese Merchants of Am., LLC, No. 21-CV-1571, 2022 WL 4483886, at *15 (N.D. Ill. 

Sept. 27, 2022) (alleged BIPA violations came directly within the scope of identical 

Recording and Distribution of Material or Information Exclusion; distinguishing W. Bend 

Mut. Ins. Co. v. Krishna Schaumburg Tan, Inc., 2021 IL 125978, ¶ 58, 183 N.E.3d 47 on 

different exclusionary language); Massachusetts Bay Ins. Co. v. Impact Fulfillment Servs., 

LLC, No. 1:20CV926, 2021 WL 4392061, at *6 (M.D.N.C. Sept. 24, 2021) (same). 

18. The Personal and Advertising Injury Liability coverage contains an exclusion 

for Access Or Disclosure Of Confidential Or Personal Information, which excludes 

coverage for “‘personal and advertising injury’ arising out of any access to or disclosure of 

any person’s or organization’s confidential or personal information, including patents, 
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trade secrets, processing methods, customer lists, financial information, credit card 

information, health information or any other type of non-public information.” (Exs. 2-7, 

Electronic Data Liability Endorsement, Paragraph B.2.)

19. Personal and Advertising Injury coverage is excluded because the alleged 

BIPA claims against Service King arose out of “access to or disclosure of any person’s or 

organization’s confidential or personal information.” See Cont'l W. Ins. Co. v. Cheese 

Merchants of Am., LLC, No. 21-CV-1571, 2022 WL 4483886, at *5 (N.D. Ill. Sept. 27, 

2022) (holding identical exclusion barred BIPA claim; noting split on the issue in the 

Northern District of Illinois federal courts).

III. Employee Benefits Liability Coverage Does Not Apply.

20. The Federated Policies’ Employee Benefits Liability Coverage insuring 

agreement provides “claims-made” coverage for “those sums that the insured becomes 

legally obligated to pay as damages because of any act, error or omission . . . negligently 

committed in the ‘administration’ of your ‘employee benefit program’”. It defines 

“administration” in pertinent part as “[p]roviding information to “employees”, including 

their dependents and beneficiaries, with respect to eligibility for or scope of “employee 

benefit programs”. And it defines “employee benefit program” in pertinent part as “a 

program providing [certain types of] benefits to “employees”, whether provided through a 

“cafeteria plan” or otherwise. (Exs. 2-7, Employee Benefits Liability Coverage Form).

21. Employee Benefits Liability Coverage does not apply under the policy’s 

ordinary and generally accepted meaning, because the Underlying Complaint does not 

allege that Service King committed any act, error or omission in the “administration” of an 
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“employee benefit program.” To the contrary, the maintenance of biometric data records 

in no respect provides employees with any sort of “benefit.” Cf. Texas Dist. Lutheran 

Church-Missouri Synod v. Federal Ins. Co, No. 03-99-00268-CV, 2000 WL 632648, at *1 

(Tex. App. May 18, 2000) (allegations that insured was not qualified to offer elderly client 

estate planning advice in connection with pressuring her into transferring control of her 

estimated $2 million estate to the insured was not the administration of an employee benefit 

program); 

22. On the other hand, the maintenance of employee biometric data records does

qualify as an “employment related practice” under the Policy’s Employment Related 

Practices exclusion, which excludes “damages arising out of wrongful termination of 

employment, discrimination, or other employment-related practices.” (Id., Exclusions)

23. Accordingly, Personal and Advertising Injury Liability coverage is excluded 

under the Employment Related Practices exclusion’s ordinary and generally accepted 

meaning, because the alleged BIPA claims constitute an excluded Employment Related 

Practice.

IV. Other Coverage Defenses.

24. The Federated Policies are subject to other terms, conditions and exclusions 

that may preclude or limit coverage for Service King, as set forth in Federated’s 

Reservation of Rights letter and its Complaint in this matter. Solely for the purposes of 

this Motion, Federated stipulates the Court need not determine the extent to which those 

defenses might apply. 
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PRAYER FOR RELIEF

25. Federated hereby prays for a judicial declaration in the form of a default 

judgment from the Court that Federated does not owe any duties to defend or indemnify 

Service King in the Underlying Lawsuit.

WHEREFORE, Plaintiff Federated respectfully requests entry of default against 

Defendant Service King. Federated further requests a judicial declaration in the form of a 

default judgment that Federated does not owe any duty to either defend or indemnify 

Service King in the Underlying Lawsuit, and for such other and further relief to which it 

may be entitled.

Respectfully submitted,

/s/ Beth D. Bradley

Beth D. Bradley 

State Bar No. 06243900

bethb@tbmmlaw.com

TOLLEFSON BRADLEY MITCHELL & MELENDI,

LLP

2811 McKinney Avenue, Suite 250 West

Dallas, Texas 75204

Telephone: (214) 665-0100

Facsimile: (214) 665-0199

-and-

/s/ Charles E. Spevacek

Charles E. Spevacek (pro hac vice)

cspevacek@meagher.com

Michael P. McNamee (pro hac vice)

mmcnamee@meagher.com

MEAGHER & GEER, P.L.L.P.

33 South Sixth Street, Suite 4400

Minneapolis, MN 55402
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Phone: (612) 338-0661

Fax: (612) 338-8384

Attorneys for Plaintiff Federated Mutual 

Insurance Company

CERTIFICATE OF SERVICE

I hereby certify that on December 20, 2022, a copy of the foregoing was served 

certified mail, return receipt requested, and regular United States mail on the following:

Service King Paint & Body, LLC

c/o CT Corporation System

1999 Bryan St., Ste. 900

Dallas, TX 75201-3136

/s/ Beth D. Bradley

Beth D. Bradley